Experian PLC

Experian PLC 635400RXXHHYT1JTSZ26 2020-04-01 2021-03-31 635400RXXHHYT1JTSZ26 2019-04-01 2020-03-31 635400RXXHHYT1JTSZ26 2021-03-31 635400RXXHHYT1JTSZ26 2020-03-31 635400RXXHHYT1JTSZ26 2020-04-01 635400RXXHHYT1JTSZ26 2019-04-01 635400RXXHHYT1JTSZ26 2019-04-01 2020-03-31 ifrs-full:RetainedEarningsMember 635400RXXHHYT1JTSZ26 2019-04-01 2020-03-31 ifrs-full:EquityAttributableToOwnersOfParentMember 635400RXXHHYT1JTSZ26 2019-04-01 2020-03-31 ifrs-full:NoncontrollingInterestsMember 635400RXXHHYT1JTSZ26 2019-04-01 2020-03-31 ifrs-full:OtherReservesMember 635400RXXHHYT1JTSZ26 2019-04-01 2020-03-31 ifrs-full:SharePremiumMember 635400RXXHHYT1JTSZ26 2020-04-01 2021-03-31 ifrs-full:RetainedEarningsMember 635400RXXHHYT1JTSZ26 2020-04-01 2021-03-31 ifrs-full:EquityAttributableToOwnersOfParentMember 635400RXXHHYT1JTSZ26 2020-04-01 2021-03-31 ifrs-full:NoncontrollingInterestsMember 635400RXXHHYT1JTSZ26 2020-04-01 2021-03-31 ifrs-full:OtherReservesMember 635400RXXHHYT1JTSZ26 2020-04-01 2021-03-31 ifrs-full:SharePremiumMember 635400RXXHHYT1JTSZ26 2020-03-31 ifrs-full:IssuedCapitalMember 635400RXXHHYT1JTSZ26 2020-03-31 ifrs-full:SharePremiumMember 635400RXXHHYT1JTSZ26 2020-03-31 ifrs-full:RetainedEarningsMember 635400RXXHHYT1JTSZ26 2020-03-31 ifrs-full:OtherReservesMember 635400RXXHHYT1JTSZ26 2020-03-31 ifrs-full:EquityAttributableToOwnersOfParentMember 635400RXXHHYT1JTSZ26 2020-03-31 ifrs-full:NoncontrollingInterestsMember 635400RXXHHYT1JTSZ26 2021-03-31 ifrs-full:IssuedCapitalMember 635400RXXHHYT1JTSZ26 2021-03-31 ifrs-full:SharePremiumMember 635400RXXHHYT1JTSZ26 2021-03-31 ifrs-full:RetainedEarningsMember 635400RXXHHYT1JTSZ26 2021-03-31 ifrs-full:OtherReservesMember 635400RXXHHYT1JTSZ26 2021-03-31 ifrs-full:EquityAttributableToOwnersOfParentMember 635400RXXHHYT1JTSZ26 2021-03-31 ifrs-full:NoncontrollingInterestsMember 635400RXXHHYT1JTSZ26 2019-04-01 ifrs-full:IssuedCapitalMember 635400RXXHHYT1JTSZ26 2019-04-01 ifrs-full:SharePremiumMember 635400RXXHHYT1JTSZ26 2019-04-01 ifrs-full:RetainedEarningsMember 635400RXXHHYT1JTSZ26 2019-04-01 ifrs-full:OtherReservesMember 635400RXXHHYT1JTSZ26 2019-04-01 ifrs-full:EquityAttributableToOwnersOfParentMember 635400RXXHHYT1JTSZ26 2019-04-01 ifrs-full:NoncontrollingInterestsMember 635400RXXHHYT1JTSZ26 2020-04-01 ifrs-full:IssuedCapitalMember 635400RXXHHYT1JTSZ26 2020-04-01 ifrs-full:SharePremiumMember 635400RXXHHYT1JTSZ26 2020-04-01 ifrs-full:RetainedEarningsMember 635400RXXHHYT1JTSZ26 2020-04-01 ifrs-full:OtherReservesMember 635400RXXHHYT1JTSZ26 2020-04-01 ifrs-full:EquityAttributableToOwnersOfParentMember 635400RXXHHYT1JTSZ26 2020-04-01 ifrs-full:NoncontrollingInterestsMember iso4217:USD iso4217:USD xbrli:shares Experian Annua l Report 20 2 1 Y ea r ended 3 1 Ma rch 2 02 1 Tr a n s f o r m i n g l i ve s w ith da t a Experian Annual Report 2021 Our purp ose T o cr ea te a be t te r t omo r r ow f or co nsu mers, f or bu si nesses, for o u r peopl e and fo r ou r comm uni ti es. Wha t we d o W e c rea te oppo r tu nit ies b y tu rn in g d at a in to in form at io n, a nd b y de pl oyi ng adva nc ed tec hnol ogies and analy tic s. Why this matte rs As the wo rld’ s l eadi ng in form at io n services co mp an y we pl ay a p iv ota l role i n the soc ie ties i n wh ic h we work. W e bel ie ve i t is o u r res pon si bil ity to u se ou r capa bi liti es an d d ata a s a force f or g ood. Contents Roundings Ce rt ain ﬁn anci al dat a has b een r ound ed in t his r epo rt . A s a res ult, t he tot al s of dat a pre sen ted ma y var y sli ghtl y fro m the a ctu al ar ithm eti c tota ls o f the da ta. Exchange rates Pr inci pal e xchan ge ra tes u sed a re gi ven in n ote 10 to th e Gr oup ﬁn ancia l st atem ent s. T he ave ra ge po und s ter ling to USd oll ar ra te is 1.31 (202 0 1 .27 ). T o download this Annual Report and our other corporate liter ature visit www .experianplc.com Financial highlights Statutory Growth % at actual rates Growth % at constant rates Benchmark Growth % at actual rates Growth % at constant rates Revenue US$ 5,372 m (2020: US $5, 1 79m) + 4% + 6% Revenue – ongoing acti vities US$ 5, 357 m (2020: US$5, 1 6 1 m) + 4% +7 % Operating proﬁt US$ 1 ,1 8 3 m (2020: US$1,185m) 0% + 4% Benchmark EBIT¹ US$ 1 ,38 5 m (2020: US$ 1 , 386m) 0% +3 % Proﬁt before tax US$ 1 ,077 m (20 20: US$942m) +1 4 % + 6% Benchmark proﬁt before tax US$ 1, 2 6 5 m (2020: US$1 , 255m) +1% +5% Basic EPS USc 88.2 (2020: USc7 4.8) +1 8 % +5% Benchmark EPS USc 1 0 3 .1 (2020: USc 1 03. 0) 0% + 4% 1 From ongoi ng activities. Th e 2020 ﬁ nanc ial hi ghli ght s have b een r e- pre se nted f oll owin g the r ecl ass iﬁc ati on of ou r Con sum er Ser v ice s bus ines s in L atin A mer ic a to th e Con sum er Se rv ice s bus ine ss se gme nt. S ee no te 9 to th e Gro up ﬁna ncia l sta teme nts f or f urt her d eta il. Se e not e 6 to the G rou p ﬁnan cial s tate men ts on p age 160 fo r deﬁ niti ons o f non -G AA P me asur es . Strategic report 02 Experian at a glance 04 Chairman’s statement 06 Chief Executive’s review 10 Our purpose in action – COVID-19 response 14 Our investment case 16 Key performance indicators 18 Market trends 20 Our business model 26 Our strategic focus ar eas 38 Our sustainable business str ategy: Environmental, Social and Governance 57 Non-ﬁnancial information and s172(1) statement 58 North America regional r eview 59 Latin America regional r eview 60 UK and Ireland r egional review 61 EMEA/Asia Paciﬁc r egional review 62 Financial review 72 Risk management 81 Viability and going concern Governance 84 Chairman’s introduction 86 Board of dir ectors 88 Corporate governance r eport 99 Nomination and Corporate Governance Committee report 104 Audit Committee report 111 Report on directors’ r emuneration 135 Directors’ r eport Financial statements 139 Financial statements contents 140 Independent auditor ’s report Group ﬁnancial statements 147 Group income statement 148 Group statement of comprehensive income 149 Group balance sheet 150 Group statement of changes in equity 151 Group cash ﬂow statement 152 Notes to the Group ﬁnancial statements Company ﬁnancial statements 206 Company ﬁnancial statements 208 Notes to the Company ﬁnancial statements 220 Shareholder and corporate information 222 Glossary Tr a n s f o r m i n g li ve s with data We play a vital role for People Empowe ring them t o bet t er understand the ir ﬁn ancial pos ition, t o tak e contro l of thei r ﬁn ances and man age thei r ﬁn anci al health. Businesses Helpi ng them to m ak e more in formed and better decisio ns. Communities, governments and charities Usi ng data to help th e most vulnerabl e in society and to su ppor t economic grow th. An unprec edent ed year The past y ear w as not one t hat we , or an yone, c ou ld h av e pred ict ed. Fo r ma ny it ha s been a t im e of g rea t h ard sh ip and l oss. The CO VID- 1 9 pan dem ic is sad ly n ot o ver y et a nd we a re all wo rki ng th rou gh i ts im pact, th e lo ng-t erm eects of w hi ch a re u nkn own. At Experi an, w e h av e play ed an esse n ti al r ol e in h elp in g peopl e, bus inesses, go vern me nts, an d soci ety man age thr oug h th e cri si s. W e ha ve he lped our em pl oy ees ad ap t to re mo te w orki ng a nd we h ave reorie n ted ho w we eng aged wi th t en s of t hou sand s of cli en ts. A good performance, de monst ratin g the res ili ence o f our bu sin ess Experia n del ive red g rowth in FY2 1 . Org ani c reve nue gr owth was 4 % and t otal re ve nue g rowth from ong oi ng act iviti es wa s 7 % at co nsta nt currenc y . No r th Amer ica and Brazil per for med s trongly , o set ting decl in es in U K and Ire lan d, an d EM E A/ A s ia P ac iﬁc. Our a bility to g row , even i n a cris is, re ﬂects the stre ngth and d iversi ty of ou r por tfoli o. It a l so reﬂ ects our co mm itm en t to i nnov at ion a nd to the mi llion s of re lat ion sh ips we h ave esta bli sh ed with c on su mers. Looki ng a head t o F Y2 2 we a re poi sed for st rong g rowth. Our add ressa ble m arke ts are lar ge an d expa ndin g, an d we a re we ll pla ced to t ak e advan tage o f a nu mber of c om pell in g opportun iti es. Brian Cassin Chief Executive O cer 01 Experian plc Annual Report 2021 Strategic report Experian plc Strategic r eport 02 Experian at a glance Global technology and innov ation Busin ess-to-Business Consume r Ser vices US$ 2,8 66 m + 2 % US$ 1 ,1 8 4 m - 4 % US$ 1, 3 0 7 m + 17 % We a re a glo bal tech nology compa ny pla ying a k ey role i n maki ng it eas ier for consu mers and bus inesses to in teract. We he lp them ma nage t heir ﬁ nanc ia l heal th, mak e informed decisio ns and sei ze opportunities. We e mbrace in novat ion and h arness techn ology to expa nd access to credit, su ppor t respons ible l endi ng, modernise processes and bet te r protect aga inst fraud and ide ntity theft . Our ta len ted and d iverse workforce ser ves custo mers worldwide from 44 count ries. We ma nage and o rgan ise ourselves ac ross four geograp hic reporting regions and two bus iness segments. Revenue from on going ac tivities by reg ion and busines s activi ty (US$m) Data Decisioning Business-to- Business Consumer Services T otal US$m % split A North America 1,761 694 2,455 1,075 3,530 65 B Latin America 457 92 549 76 625 12 C UK and Ireland 361 220 581 156 737 14 D EMEA/Asia Paciﬁc 287 178 465 n/a 465 9 T otal 2,866 1,184 4,050 1,307 5,357 We help businesses to identify and under stand their customers and to lend responsibly and appropriately , providing them with the information to help them manage the risks associated with lending. W e also help them build a better understanding of consumers’ prefer ences. We ar e experts at creating and developing innovative analytic al and decisioning tools. We help businesses to manage their customers, minimise the risk of fraud, comply with legal requir ements and automate decisions and processes. We help consumer s take control of their cr edit , making it easier for them to manage their ﬁnancial position, r eceive ﬁnancial education, access credit oers, and protect themselves from identity fr aud. Data Revenue - ongoing activities 1 De cisioning Revenue - ongoing activities 1 Revenue - ongoing activities 1 Our bus iness ac tivities 11 0 m Fr ee consumer membership base 1 7, 8 0 0 * employees globally 16 6 m Business credit history recor ds 1. 3 bn Consumer credit history recor ds 44 Countries DataLab San Diego DataLab São Paulo DataLab London DataLab Singapore North America Latin America EMEA/Asia Paciﬁc UK and Ireland See page 59 See page 60 See page 61 See page 58 1 % gr ow ths s hown a re or gani c rev enue g row th at c ons tan t exch ange r ate s. * Fi gure d oes n ot in clud e rec ent a cqui sit ions i n Spai n an dBraz il. 03 Experian plc Annual Report 2021 Strategic report See page 26 See page 38 Make credit and lending simpler , faster and safer for consumers and businesses Help businesses verify identity and combat fraud Help organisations in specialised vertical markets harness data and analytics to make smarter decisions Enable businesses to ﬁnd, understand and connect with audiences 1 3 4 5 Empower consumers to improve their ﬁnancial lives 2 Our customers Our str ategic focus areas Our sustaina ble business s trategy Our investme nt case, a unique p roposition We are a l eade r in glob al information services with strong pos itio ns in grow ing ma rket s Stro ng fo undat ions su ppo rt o ur grow th potential We pl ace a str ong em phasi s on env iro nment al, s ocia l and gov ern anc e (ESG ) crit eria We rema in ﬁnan cially w ell positioned See page 14 T reating data with respec t SUPPORTED BY ENABLED BY Wor kin g with integrit y Inspirin g and su pporting our p eop le Prote cting the environment Secu rity Accura cy Privacy T ransparen cy OUR PURPOSE Creating a better tomorrow Improvin g ﬁnancial health for all Core product s Socia l Innovation Community investment THROUGH OUR Experian plc Strategic r eport 04 Chairman’s statement Supporting our customers, clients and communities in challenging times Mike Roger s Chairman Responding to the crisis in a purpose- led way – using data for good The pandemic has demonstrated the power ofdata as a force for good in dicult times. Data-led decision-making has been critical in helping us to take on the biggest challenge in ageneration. In the USA, we developed the COVID-19 Outlook & Response Ev aluator (CORE) tool to predict future hot zones for the virus – a fr ee application that allows health and government leaders to forec ast how a speciﬁc area may beaected. In the UK, we launched Experian Safeguar d, a dashboard based on anonymised data insights, to help organisations, including food banks and local authorities, to plan and allocate their resour ces based on those who need it most. In Brazil, the COVID Radar Panel provided information about the pandemic to partners, oering them a detailed view on COVID-19 movement by city and even by neighbourhood, toallow the adoption of quick and assertive measures in the most aected ar eas. Supporting global ﬁnancial health Alongside these data-driven initiatives, our United for Financial Health progr amme has used ﬁnancial education and partnerships to help the people hit hardest by the COVID-19 crisis. T o date, we hav e worked with 11 new non-proﬁt organisations in the USA, UK and Brazil, providing r esources, funding, products and volunteers as part of our mission to impro ve ﬁnancial health worldwide. We ha ve reached 35 million people so far , more than doubling our progr amme target of reaching 15 million people this year . Our aim is to r each 100 million people in total by 2024. We ha ve oered cr edit education, advice and free tools to consumers and businesses across the globe. I am pr oud that more than 110 million people can now access their cr edit reports fr ee on our consumer platforms, helping them better understand their credit pr oﬁles, save money and navigate their personal ﬁnancial needs. Furthering our eorts to help consumer s, our Social Innovation pr ogramme in vests in new products speciﬁc ally designed to oer additional societal beneﬁts as well as creating r evenue for our business. Through Social Innov ation, we hav e reached 61 million people in the last eight year s – including 28 million this year – with a target ofreaching 100 million by 2025. These are examples of the purposeful activity that helps contribute towards r eaching the three United Nations Sustainable Development Goals we’ve identiﬁed as those we can inﬂuence, all of which we are addr essing through our str ategic focus on improving ﬁnancial health. Y ou can readmor e on page 38. When I wrote about COVID-19 aecting the world in our 2020 Annual Report, I nev er expected this 2021 statement would be a reﬂection on living and working amid the global pandemic for a further 12 months. It has been an extraor dinary year , yet we have stayed true to our purpose and achieved a strong performance. Once again, Experian has shown it can withstand external shocks and gr ow even in the most challenging of circumstances. Our resilience is due to the diversity of our portf olio, the strength of our cultur e and the focus of our strategy on innov ation-led growth. We expect to emerge fr om the pandemic in good shape, with an abundance of opportunities to pursue despite operating in man y of the worst-hit countries. Throughout the pandemic, our people remained focused on supporting customers, governments and the communities we serve: I found the commitment of Experian colleagues across the world inspiring. F or example, Experian moved quickl y to make our data insights available to governments, health services, communities, businesses and charities, so they could better r espond to their challenges. W e also worked r apidly with lenders and governments to support ﬁnancial accommodation progr ammes, making sure ﬁnancial support reached those in need, and ensuring that economies kept moving as well aspossible during lockdowns. The pandemic h as demo nstrated thepower o f data as a f orce for good in dic ul t times. Data-led decis ion- maki ng has been criti cal in he lping us to ta ke on t he biggest cha llenge ina gene ration. Experian moved qui ckl y to ma ke ou r da ta ins igh ts avai l ab le to go vernmen ts, health ser vi ces, com muni ties, b usi nesses and ch arities, so they cou ld better respond to the ir ch all enges. We a lso worked rapid ly with l enders and gove rnme nts to supp or t ﬁnan cial acco mmodation p rogramm es, maki ng sure ﬁ na nci al su ppor t reached those i n need. 05 Experian plc Annual Report 2021 Strategic report As part of a continued focus on improving our sustainability disclosure, this year we have started reporting to the r ecommendations of the Sustainability Accounting Standards Boar d (SASB) fr amework. Our commitment to the en vironment We acknowledge our r esponsibility to help protect theplanet for futur e gener ations, and we have set ambitious new targets to benchmark our progr ess. Our aim is to be carbon neutr al in our own operations by 2030. FY21 is the ﬁrst year for which we’ll oset a portion of our emissions, osetting 20% of our emissions with the goal ofreaching 100% in FY25. We ar e also announcing science-based targets to cut our Scope 1 and 2 emissions by 50%, andour Scope 3 emissions by 15% by 2030. In addition, we ar e proud to be a public supporter of the T ask F orce on Climate-related Financial Disclosures (T CFD) and our ‘A-‘ rating from the CDP (formerly known as the Carbon Disclosure Project) places us in the leadership c ategory for our disclosure on climate risk s and opportunities. Positioned for gr owth with digitaltechnology Innovation has always been a centr al belief of Experian’s business, and we ar e well positioned to take advantage of tr ends and opportunities wehave identiﬁed in the market. The pandemic has changed the behaviour of consumers, and ofhow businesses operate, in many cases accelerating exciting tr ends towards the adoption of digital business models – I would encourage y ou to read mor e about these trendson page 18. We ha ve adapted quickly to the changing environment and continued with our signiﬁc ant progr amme of investment. This is helping ustobuild fast-gr owing franchises in ar eas likeExperian Consumer Services and ExperianHealth. We ha ve also moved forward with the internationalisation of our ground-br eaking innovations like Experian Ascend and our Open Data platform. F or example, we introduced a r aft of propositions to take adv antage of the new era of positive data in Brazil, a market change that will greatly enhance fair access to cr edit for theBrazilian population. We ha ve remained rightly ambitious, so we have not let up on geographic expansion (f or example our German acquisition) or in building new franchises such as veriﬁc ation services. These are just a few examples of the geogr aphic growth and innov ation-led growth at the heart ofour strategy . People and cultur e The innovative solutions we pr ovide to customers are made possible by our people. Throughout the pandemic, we have adopted a ‘people ﬁrst’ agenda. Colleagues ha ve had to work in very dierent cir cumstances, and we have supported them by oering the ﬂexibility they need for their changing world. As we emerge fr om the lockdowns, we will continue to adopt new ways of working and we will give much of our global workforce mor e ﬂexibility to work to a pattern that suits them and beneﬁts Experian. I remain incr edibly proud of our gr owing diversity at Experian, and we continue with a str ong focus on recruiting, retaining and developing colleagues who fully reﬂect the rich diver sity of the communities we serve. We believe this achieves both better outcomes for customers and superior business performance. This year we hired our ﬁr st-ever Chief Diversity Ocer in our North American business, and our global leaders are serving as ex ecutive sponsors for key diversity pillar s – gender , r ace and ethnicity , disability , L GBTQ+ and mental health. I would like to express m y thanks on behalf of the Board to our 17,800 employees, who have shown remarkable r esilience and commitment, and without whose talents we could not achieve success for customers or shareholder s. Governanc e and the Board Strong corpor ate governance has always been at the heart of the Experian business, and we maintain the highest standards as set out in the UK Corporate Gov ernance Code 2018. I am pleased our current Boar d meets the recommendations of both the Hampton- Alexander Review on gender diversity and the Parker R eview on ethnic diversity . During the last ﬁnancial year , we wer e delighted to welcome Alison Brittain as an independent non-executive director . Her impressive career of over 25 years of senior management experience at a variety of major ﬁnancial institutions, and as a FTSE 100 Chief Executive, means Alison is an invaluable addition to the Boar d. I look forw ard to working closely with her over the coming years. In March 2021, we announced that Jonathan Howell would join the Board in May 2021 as an independent non-executive director . Jonathan is a highly regar ded FTSE 100 Chief Financial Ocer , and also brings a wealth of r elevant expertise and extensive board-level experience. There wer e no other changes to the Board during the period. Committed to data privacy As we plan for the future, we are also acutely aware of our r esponsibilities when managing the information we are entrusted with. Data is critical to economic growth, but it must be managed and used appropriately . Experian holds vast amounts of data, and we have a responsibility to mak e sure it is kept saf e and used only in the most appropriate and responsible way s. Maintaining the highest levels of security is fundamental to our business and we follow strict regulations for managing and using data in compliance with all relevant la ws. We'r e ﬁrmly committed to doing the right thing when it comes to working with consumer data and have progr ammes that evaluate every product and service to ensur e we strike the right balance between privacy consider ations and the economic beneﬁt to customers. Furthermor e, we are continually inv esting in our multi-layered information security progr amme to prevent, detect and mitigate cyber security risks in all our markets. The future – performanc e with purpose Looking ahead, we hav e a clear strategy of innovation-led gr owth to captur e the potential from a number of substantial and exciting addressable markets, so growing shareholder value further . Financial performance this year was r esilient. We deliver ed 4% organic revenue gro wth, led by North America and Latin America, which helped to oset weaker performances elsewher e. Portfolio diversity , strong execution and our commitment to long-term strategic in vestments were all contributory factors, helping the Group withstand the trading challenges posed by the pandemic. It is also worth noting that Experian ended the year in a strong funding position, was able to move forwar d with some exciting investments to extend the fr anchise, while maintaining the ﬁnal dividend in line with the prior year . Our people’s professional and personal responses to COVID-19 and the r esults achieved have been remark able. W e have helped people, organisations and government use data to mak e a dierence and have extended our commitment to supporting ﬁnancial health around the world. So we enter next year with strong f oundations for further growth and the conﬁdence that comes from knowing that, through the most challenging of times, we continue to work towards our purpose of cr eating a better tomorrow . Experian plc Strategic r eport 06 Chief Executive’s r eview A r esilient performance spurr ed by innov ation, teamwork and empathy Revenue – ongoing activities US$ 5 , 357 m + 4 % 1 Benchmark EBIT – ongoing activities US$ 1, 3 8 5 m + 3 % 2 Revenue growth w as 7% at constant currency and or ganic revenue gr owth was 4%. At actual ex change rates r evenue gro wth was 4%. Organic r evenue growth in North Americ a was 7% and 9% in Latin America, including very strong contributions fr om Consumer Services. The UK and Ireland and EMEA/Asia Paciﬁc r egions were impacted negatively , down (6)% and (14)% respectively . B2B organic r evenue growth was ﬂat. Growth in North America Data and Decisioning was oset by declines elsewhere. Growth in Consumer Services was very strong, with organic r evenue up 17%, driven by North America and Br azil. Growth in Benchmark EBIT w as 3% at constant exchange rates and ﬂat at actual exchange rates after curr ency translation headwinds. Our Benchmark EBIT margin was 25.9%, down 80 basis points at constant currency and down 100 basis points at actual exchange rates. This was after deliberate action to support our people through the crisis, incr eased marketing investment and investment to support new product innovation and technology tr ansformation. We deliver ed growth in Benchmark earnings per share of 4% at constant exchange r ates and ﬂat at actual exchange rates. Cash ﬂow was very strong, with a conversion rate of Benchmark EBIT into Benchmark operating c ash ﬂow of 106%. We ended the y ear in the lower half of our leverage r ange at 2.2x (on a pre-IFRS 16 basis), compar ed to our target of 2.0-2.5x f or Net debt to Benchmark EBITDA. Brian Cassin Chief Executive Ocer E xper i an deliver ed a s trong per for mance this year , even as the w orld fa ced th e test in g ti mes posed by t he CO VID- 1 9 pa nde mi c. W e ha ve aga i n sho wn E xperi an ’ s resi lienc e in t he fac e of e xtern al sh ocks, wh ic h is d ue t o the div ers ity of ou r port fol io a nd oursu ccess ful innovation- led in vestmen t s i n new o pportun iti es. F Y2 1 was a year wh en we un lock ed the po we r of da tafo rcon su mers, cli en ts andc om mu ni ti es acr oss the world. Experian delivered another successful year of growth even as the COVID-19 pandemic posed signiﬁcant challenges to people, clients, and the world economy . I am pr oud of the accomplishments of our 17,800 people around the world who have shown incredible r esilience and passion, and who hav e worked tirelessly to serve our various communities over this year . In recognition, we intend to make a special one-o share-based awar d to recognise the outstanding commitment of our people this year . The COVID-19 pandemic has demonstr ated how properly managed data c an be used as a signiﬁcant for ce for good and has been used by decision-makers to navigate the immediate crisis and to direct r esources to wher e they were most needed. Our people were instrumental in using innovative data science to predict hot zones for the spr ead of the virus. W e stepped up to launch ﬁnancial education projects aimed at supporting communities impacted by COVID-19. W e supported governments, charities and f ood banks to help the most vulnerable during the pandemic, and we provided health and data modelling tools to assist with co-ordination of national eorts. These are just some examples of how we hav e placed the power of our data and innovation in service of society . As we look out to the economic recovery in the months ahead, data will be a critical driver of gr owth, helping Ful l-year ﬁnanci al highlights businesses and consumers make better - informed decisions about their futures. Our ﬁnancial performance was robust. T otal revenue gr owth was 7% at constant currency , while organic ally we grew 4%. Consumer Services deserves special mention, delivering 17% underlying growth in the year and r eaching 110 million members globally . W e beneﬁtted from gr owth in B2B platforms across man y territories. Combined with continued expansion in key verticals lik e health, and gr owth in counter-cyclic al revenue str eams such as US mortgage, this enabled us to oset declines in some parts of our business caused by the COVID-19 economic downturn. W e beneﬁtted both from our portfolio diver sity and from the strategic in vestments we have made over many years, and we continued to invest in our business in FY21. 1 O rgan ic gro wt h at co nst ant exchange rates. 2 At c ons tan t exch ange r ate s. 07 Experian plc Annual Report 2021 Strategic report We further str engthened our funding position while also supporting investment activities. We continued to in vest in data, technology and innovation thr ough capital expenditur e. Capital expenditure r educed by (13)% to US$422m, which r epresented 8% of total revenue. For FY22, we expect c apital expenditure to r epresent cir ca 9% of total revenue. We took steps to expand the r each of our portfolio through a number of inor ganic investments. These included: – The expansion of our bureau estate with the acquisition of a majority stake in a German credit bur eau (the Risk Management division of Arvato Financial Solutions) and of the Spanish credit bureau, Axesor . – We also accelerated our entry into the veriﬁcation services vertical with the acquisition of employer solutions pro vider Corporate Cost Contr ol . After the year end, we acquired T ax Credit Co (TCC) and Emptech, which also add to our income veriﬁcation business in North America. – Consistent with our ambitions to extend our position in fraud and identity management, we acquir ed T apad, a leader in resolution of digital online identities and BrScan, a leading player in Br azil. – T otal acquisition outﬂow in the year was cash of US$583m and 7.2m Experian plcshares. One of our key oper ating principles to manage throughout the COVID-19 crisis has been to retain c apacity to recover str ongly and to help our people to cope with the crisis. We did not use an y government furlough schemes. We deliber ately balanced our approach to cost management. We cut back on discretionary spend, froze headcount, and delayed non-critical inv estment. We also supported our people and sustained critical growth investments. We took concerted action to increase investment in mark eting Revenue and Benchmark EBIT by region, Benchmark EBIT margin 2021 US$m 2020 2 US$m T otal growth 1 % Organic gr owth 1 % Revenue North America 3,530 3,247 9 7 Latin America 625 732 9 9 UK and Ireland 737 755 (6) (6) EMEA/Asia Paciﬁc 465 427 7 (14) Ongoing activities 5,357 5,161 7 4 Exited business activities 15 18 n/a T otal 5,372 5,179 6 Benchmark EBIT North America 1,201 1,093 10 Latin America 172 220 4 UK and Ireland 122 173 (34) EMEA/Asia Paciﬁc (20) 12 (232) T otal operating segments 1,475 1,498 2 Central Activities – centr al corporate costs (90) (112) n / a Benchmark EBIT from ongoing activities 1,385 1,386 3 Exited business activities 1 1 n / a T otal Benchmark EBIT 1,386 1,387 3 Benchmark EBIT margin – ongoing activities 25.9% 26.9% 1 At c ons tan t exch ange r ate s. 2 Re sult s fo r FY 20 are r e- pre se nted f or th e rec las siﬁ cat ion to e xit ed bu sine ss a cti vit ies o f cer ta in B2B bu sine ss es . Se e the F inan cial r evi ew fo r analy sis of r eve nue , Ben chma rk EB IT an d Ben chma rk EB IT m argi n by bus ine ss se gme nt and n ote 6 to th e Gro up ﬁna ncia l sta teme nts f or de ﬁni tion s of no n- GA AP m easu res . Funding and liqui dity Operating ecienc y North America deliver ed organic r evenue growth of 16%. We ar e investing behind the success of Experian Boost, which now has 6.7m unique account connections. Our membership continued to grow and we launched a new vertical, automotive insurance, which performed strongly , and which oers signiﬁcant further gr owth opportunities in FY22 and beyond. Our Latin America rev enues more than doubled in the year at local curr ency , with revenue up 144% or ganically . Consumer Services in the UK recover ed as the year progr essed, returning to gr owth in H2. W e launched Experian Boost in the UK in early November and now have 370,000 active Boost members. B2B organic r evenue was ﬂat over all, recovering as the y ear progr essed, with H1 (2)% and H2 +2%: Growth in North Americ a and Latin America oset declines in other regions. Strength in US mortgage volumes, Experian Ascend, health and fraud and identity services helped to oset weaker conditions for unsecur ed credit origination, decisioning software and marketing expenditure b y clients. We made further headway with the r oll-out and scaling of our cor e B2B platforms. The cumulative total contract v alue for Ascend is US$374m and we continue to make progr ess with Experian One, Cr ossCore and our Open Data platforms. Health delivered another year of gr owth, automotive was stable and we have expanded our position in employment and veriﬁcation services. In Brazil, we had signiﬁcant success extending our relationships with some of ourlargest ﬁnancial services clients as wesigned expanded new multi-year agreements, and we saw good gr owth in positive data propositions. We had an outstanding y ear in Consumer Services, which deliver ed 17% organic revenue growth, with H1 +13% and H2 +22%: We now ha ve 110 million free consumer memberships, up by 28 million year-on- year . We ha ve 41 million free members in the US A, 59m in Brazil and 9.5 million in the UK. expenditure in support of Consumer Services. W e have also invested in and materially progr essed our technology transformation as we migr ate from mainframes into a distributed fr amework utilising the cloud, and we continued to in vest in new product innov ation. We pr eviously announced that we have embarked on a tr ansformation progr amme in the UK and Ireland to simplify our technology estate, enhance customer experience and to return to pr oﬁtable growth. The progr amme is progressing well and to plan. As pr eviously announced, these actions have given rise to an exceptional restructuring char ge of US$50m in FY21. We are on course to deliver y ear-on- year run-rate sa vings of US$40m in the year ending 31 March 2022. The net eect was that EBIT margin f or the year reduced to 25.9%. For FY22, we expect strong accr etion in the EBIT mar gin. Experian plc Strategic r eport 08 Chief Executive’s r eview contin ued Other ﬁnancial developments Benchmark PBT was US$1,265m, up 5% at constant currency and 1% at actual r ates, after lower net interest expense of US$121m (2020: US$132m). The reduction r eﬂects lower aver age global interest r ates. For FY22, we expect net interest expense to be ar ound US$115-120m. The Benchmark tax rate was 25.9% (2020: 25.8%). F or FY22, we expect a r ate in the range of 26% to 27%, taking into account expected pr oﬁt mix for the year . Our Benchmark EPS was 103.1 US cents, an increase of 4% at constant curr ency and ﬂat at actual exchange rates. The weighted average number of ordinary shar es (W ANOS) increased to 910m (2020: 902m), inclusive of the shar es delivered in connection with the pur chase of our stake in the Risk Management division of Arvato Financial Solutions. F or FY22, we expect W ANOS of circ a 915m. Benchmark operating c ash ﬂow increased 22% at actual rates and our c ash ﬂow conversion was 106% (2020: 88%). The increase is due to the mix of growth, strong control of working capital, reduced infr astructure investment, andsome phasing. Y ear-on-y ear % change in organic revenue – for the y ear ended 31 March 2021 % of Group revenue Data Decisioning B2B 1 Consumer Services T otal North America 65 5 2 4 16 7 Latin America 12 1 2 1 144 9 UK and Ireland 14 (5) (7) (6) (6) (6) EMEA/Asia Paciﬁc 9 (8) (20) (14) n/a (14) T otal Global 100 2 (4) 0 17 4 1 B 2B = Busi nes s-t o- Bus ines s se gme nt con sis ts of D ata an d De cisi onin g bus ines s sub - div isio ns. Environmental, S ocial, andGovernance ( ES G ) A key priority for Experian is to impr ove the ﬁnancial health of the communities we serve. This is how we can use our data and expertise to make the biggest dierence to society , helping us to contribute to thr ee United Nations Sustainable Development Goals, namely tar gets 1.4, 8.10 and 9.3, which relate to impr oving access to ﬁnancial services and credit. This year we have reached 28 million people with our Social Innovation pr oducts speciﬁcally developed to deliver societal beneﬁts and improve ﬁnancial health. Examples include Social Determinants of Healthcar e, which helps people in the USA to avoid major medic al bills in future, and a ﬁnancial online training module in Brazil to help people manage their ﬁnances. This brings the total number of people reached since 2013 to 61 million, putting us on track to meet our tar get of 100 million people by 2024. A year ago, we launched United f or Financial Health, a ﬁnancial r ecovery pr ogramme partnering with NGOs to help communities signiﬁcantly aected by COVID-19. For example, we partner ed with Operation HOPE to reach ethnic minority gr oups in the USA with support to raise cr edit scores, and the National Literacy T rust in the UK. W e have reached 35 million people and small businesses across the USA, Br azil and the UK and Ireland this year . We ar e also expanding into EMEA and Asia Paciﬁc. As part of our ‘people ﬁrst’ agenda we will be making a special one-o share-based recognition awar d to our people for their commitment to Experian during the COVID-19 pandemic. We hav e undertaken an extensive r eview of our Diversity , Equity and Inclusion str ategy , and aim to increase the number of women among our senior leaders from 32% to 40% by 2024, supporting the commitment we made this year to the UN W omen’s Empowerment Principles. Fol lowing a recent appointment, our Board is now comprised of 36% women and 73% independent members (including the Chairman). W e continue to meet the recommendations of the Hampton- Alexander Review on gender diversity and the P arker Review on ethnic diversity . Experian featured in the S&P Global Sustainability Y earbook 2021 as a leader on ESG, scoring in the top 15% of the professional services industry . Our commitment to help tackle climate change and reduce our impact on the environment is r eﬂected in our CDP rating of ‘A-‘. This places us in the leadership c ategory and among the top 14% of professional services companies for our disclosure on climate risks and opportunities. This year we have cut our absolute c arbon emissions by a further 58% and reduced our carbon intensity by 60% (Scope 1, Scope 2 market-based and Scope 3 emissions). This reduction was mainly due to the decr ease in air tra vel as a result of COVID-19 r estrictions. As business activities resume, we’re expecting to see an increase in air tr avel trends and we will continue looking into carbon r eduction initiatives to help decrease our footprint sustainably and in the long term. Building on last year’s commitment to be carbon neutr al in our own operations b y 2030, we are today announcing a science-based target to cut our Scope 1 and 2 emissions by 50% by 2030, and our Scope 3 emissions by 15% by 2030. Ha ving committed last year to gradually c arbon oset our Scope 1 and 2 emissions over the ﬁve years to 2025, we are osetting 20% of our FY21 emissions. Outlook As the global recovery gather s pace, we believe data will be a key driver of economic gr owth. We ar e o to a strong start to FY22 which gives us every conﬁdence of another successful year ahead. W e expect organic r evenue growth in the range of 7-9%, total revenue growth of 11-13% and strong EBIT mar gin accretion, all at constant currency . We hav e announced a second interim dividend of 32.5 US cents per share, unchanged year-on- year . This will be paid on 23 July 2021 to shareholders on the r egister at the close of business on 25 June 2021. We hav e also announced that we will commence a US$150m share r epurchase progr amme, which will mainly oset deliveries under employee share plans. During the year we undertook two bond issues totalling US$1.1bn. Including these, our bonds total US$4bn and have an aver age remaining tenor of six year s. At 31 March 2021, we had no drawn bank debt and held US$2.65bn of undrawn committed bank borrowing facilities which have an aver age remaining tenor of four years. These include our cor e US$1.95bn club facility which is undrawn and committed until December 2025. As at 31 March 2021, Net debt to Benchmark EBITDA was 2.2x (on a pr e-IFRS 16 basis), compared to our tar get leverage r ange of 2.0- 2.5x. F oreign exchange tr anslation was a 4% headwind to Benchmark EPS in the year . This was predominantly due to the Br azilian real, which weakened by 31% relativ e to the US dollar versus the prior year . F or FY22, we expect a neutr al impact to Benchmark EBIT , assuming recent foreign exchange r ates prevail. Consume rs around the world are faci ng increa si ng ﬁn an ci al press ures a nd need more su ppor t th an ever from organi sations. COVID - 1 9 and natural di sast ers h ave in tens iﬁed cons u mer need f or q ui ck and r el eva n t su pport. And they’ re d em an di ng it – 60 % of peo ple n ow h av e hi gh er e xpectat ion s of the iro nl in e expe rien ces th an befor e COVI D- 1 9 . At the same time, or ganisations have faced signiﬁcant business disruption, such as overwhelmed c all centres, and older , less ﬂexible processes that c an’t adapt as rapidly to changing cir cumstances, impacting customer service, and c ausing delays. Organisations ar e having to navigate this complexity , to change at pace, and take decisive action. By using automated decisioning solutions, such as our enhanced cloud-based PowerCurve solutions, businesses can upgr ade and accelerate their digital tr ansformation to eectively address these challenges. Coupled with our powerful datasets they c an make decisions with speed and agility , while still supporting customers and pr oviding them with a personalised, consistent experience. Our cloud solutions help businesses simplify their IT envir onments, lower costs, and nimbly sc ale up and down to meet consumer demand as needed. Businesses hav e access to our continuous innovation thr ough accessible upgrades and smaller companies c an take advantage of data and analytics previously out of r each. And, bec ause there’s no softwar e to install, they c an be ready to test in day s and go live in weeks r ather than months. Cloud-based decisioning is critical to an or ganisation’s ability to quickly and nimbly support their customers. The COVID-19 crisis has acceler ated the need for solutions that are fast to install, secur e, can easily sc ale to meet emerging needs and changes in demand, and upgrade seamlessly . Donna DePasquale Executive Vice President and Gener al Manager , Decisioning, Experian Strategic report 60 % of people now have higher expectations oftheir online experiences than before COVID-19 09 Experian plc Annual Report 2021 T ransforming lives wi th ag i lit y and s peed i n th e clo ud Experian Decision Analytics’ PowerCurve recognised as a winner of the 2021 Artiﬁcial Intelligence Excellence Awar d Experian plc Strategic r eport 10 Our purpose in action – COVID-19 response Supporting you during the pandemic and bey ond The COVID - 1 9 pandem ic ha s impacted mi llions of people and organ isati ons arou nd the world a nd, more tha n a year i n, man y are still g r appl ing with its menta l, emotion al , an d ﬁna nci al to ll. Among the more pressing i ssues for people ha s been navig ati ng the ﬁn anci al landscape and ha rdshi ps brought on by i llness and unem ploymen t. It has also exacerbat ed underlyi ng ﬁna nci al issues for al ready marg ina lised grou ps in soci ety . For bus inesses it has mea nt n avig ati ng operation al cl osures, ch anges to re venue models and increa sing fraud a t tac ks. In response we developed sever al solutions which provide education, advice and free tools to consumers and businesses. We have also work ed with charities and governments to ensure that ﬁnancial r elief reaches the people and businesses that need it most. Y et there are signs of hope and r esolution ahead. People’s concerns about personal ﬁnances are starting to ease and they ar e more comfortable with the security and convenience of online shopping and banking. Businesses are embr acing new opportunities to serve the growing r anks of online customers and are pr eparing for the future as pent -up consumer demand is released. Our emp loyees ha ve risen to th e cha llenge o f provid ing practical assistance , inno vati ng at speed to help those i mmedi ate ly aected and help them b etter p osition themselves as they recove r from COVID- 1 9 related ha rdsh ips. W e knew ea rly on in the pa ndemic t hat w e had an important par t t o play and piv oted our eort s to d o just th at. Looking for wa rd, we rema in com mitted to devel oping ne w ways t o use our resources, data, tec hnology and creat ivit y to be pa r t of the sol ution and long-t erm recover y . Brian Cassin Chief Executive Ocer F acilitating access to fair and aordable cr edit As people and businesses get more and mor e stretched during times of crisis, the ability to access credit, or have forbear ance on existing credit is vital. It can be the dier ence between sinking or making it through. W e remain committed to helping lenders and governments maintain access to the credit economy , and continue to support consumers to protect their credit standing and ﬁnancial health. W e stepped up ﬁnancial education for c onsumers We stepped up ﬁnancial educ ation for consumers so they could beneﬁt from accessing resour ces and educational materials to learn about credit and other important personal ﬁnance topics. Giving them the information and tools so they can make mor e informed decisions during dicult times. Highlighting the impact of the global pandemic Our resear ch, such as in our Global Insights Report and Global Data Management Resear ch Report, is helping or ganisations understand how the pandemic has impacted data perception and usage, as well as consumer behaviours and business str ategies, and helps them understand how important it is to quickly identify and support those who are facing short-term challenges as well as the vulnerable. W e launched United for Financial Health to empower and pr otect vulnerable c onsumers United for Financial Health is a new ﬁnancial recovery pr ogramme to empower and protect vulnerable consumer s hardest hit by COVID-19, helping them to improve their ﬁnancial health through educ ation and action. So far , we’ve partnered with 11 non-pr oﬁt organisations in the USA, UK and Br azil, to deliver tools and resour ces to help those aected the most. During FY21 we’ve reached 35 million people, far above our ﬁrst- year tar get of 15 million. See page 42 for more detail. 35 million People reached Globally 11 Experian plc Annual Report 2021 Strategic report Making life easier for hospital and healthcar e administrator s We developed a fr ee Payer Alerts Community COVID-19 Portal for healthcar e administrators that provides a compr ehensive overview of the latest policy and procedur e changes from medical insur ers and payers, with 8,509 alerts available to users. Allowing administrators to quickly respond to those changes, ensure smooth processing of payments and fr eeing up their time to deal with other issues. So far , 1,732 organisations and 2,049 users, from all 50 US states, hav e taken advantage of the portal during the pandemic. Helping families keep their homes and promoting ﬁnancial inclusion We partner ed with the NAACP¹ and created Home Preservation Gr ants to support African-Americ an homeowners facing COVID-19 related har dship who are at risk of losing their homes. W e donated US$150,000 to the NAACP for ﬁnancial educ ation and mortgage relief , of which US$130,000 has helped 21 families stay in their homes with grants of between US$2,000 and US$10,000 per recipient. Helping lenders understand small businesses' unique circumstances We launched a fr ee COVID-19 US Business Risk Index to assist lenders and government organisations in understanding how to mak e fair and responsible lending to small businesses that need it the most during this time. Our analy sts built the dashboard's ﬁrst iteration in one week end to provide easily accessible, r elevant insights in r esponse to the rapidly adv ancing virus. Backing innovation to help solve global challenges, level the pla ying ﬁeld and create new opportunities We've supported Massachusetts Institute of T echnology's Solve progr amme by committing up to US$100,000 for the Good Jobs & Inclusive Entrepr eneurship and Learning for Girls & Women. Each of which is working to solve ﬁnancial health issues which have arisen for consumers as a result of CO VID-19. Improving ﬁnancial health with increased access to credit r eports Fr ee weekly credit reports from Mar ch 2020 to March 2022 for all Americ ans via AnnualCreditReport.com. Innovating to support informed decisions and help mitigate risk We built the Ascend P ortfolio Loss F orecaster , a new tool for lenders that uses Experian’s data, along with up-to-date macroeconomic forec asts, to help them analy se risk accurately across consumer loan portfolios. Guiding healthcar e and government eorts to help the at-risk We cr eated a free interactive heatmap showing populations in the USA most susceptible to developing severe c ases of COVID-19: to help inform and guide eorts around communic ations, outr each to high-risk populations, align healthc are, community andgovernment progr ammes, and plan fortherecovery . US$ 1 30, 000 has helped 21 families stay in their homes Nor th America 1 Na tio nal A sso cia tion f or th e Adv anc emen t of Co lor ed Pe opl e. See ww w .naacp.org for more in formation. Experian plc Strategic r eport 12 £ 1 70 ,000 for student laptops 3.6 million Brazilians supported to r enegotiate their debts during our online Limpa Nome fair Latin Amer ica UK and Irel and Our purpose in action – COVID-19 response contin ued Colombia and Peru Helping consumers in Colombia and Peru manage their ﬁnancial health Our free cr edit reports and scor es have enabled people to manage their ﬁnancial health. In Colombia, since April 2020, more than one million people have had access to their credit history for free. From mid-April 2021, we extended this free access to SME businesses. Colombia Assisting the government to prioritise those most in need We helped the Colombian Gov ernment to segment the low-income population. Our information became an additional tool for them to use so they could deliver special subsidies to help support these households during the dicult economic situation caused by COVID-19, So far , in the ﬁrst stage alone 1,162,965 subsidies were deliver ed by the government. Brazil Applying data science to enable fast access to data for researchers and public heal th workers We built and launched a new data platform, the COVID Radar , in just thr ee weeks, and mobilised a public-private partnership of mor e than 60 companies and organisations, to use data to ﬁght the pandemic and help with Brazil ’s economic recovery . It provides r eal-time information on COVID-19 cases in Br azil and analytical tools to help pr edict its progr ession. In addition to providing c ase monitoring and disease forec asting, the CO VID Radar integrates and connects companies with the hospitals and communities that need donations of ventilators, personal protection equipment, or other supplies. Supporting Brazilian consumers to pay o their debts We held our debt negotiation fair (F eirao Limpa Nome) online this year , bringing on even mor e partners and greater discounts to support Brazilian consumer s in paying o their ﬁnancial debts during such challenging economic times. Overall, it was our biggest fair to date, we helped 3.6 million people, and saw a r ecord 6.2 million agreements r eached with lenders. Backing micro and small entrepr eneurs to create innovative business solutions We’r e backing small companies with our ‘SME challenge’ , a nationwide contest to support entrepr eneurs' innovation pr ojects and help them overcome the pandemic challenges they were facing. 1,325 companies entered the competition, all of whom had free access to our online ﬁnancial education course and their cr edit score. They also received mentorship fr om our employees who volunteered mor e than 500 hours to work with the companies, Over all, 20 companies won a cash prize of R$25,000 each to invest in the implementation of their ideas and contribute to the development of the entrepr eneurial culture in Brazil. Supporting charities to help identify vulnerable people We oer ed our Aordability Passport to organisations, including debt charities and lenders, free of char ge for three months to help them identify customers who could be left vulnerable due to changes in their ﬁnancial circumstances. Assisting public organisations including health services in planning their response We cr eated a new dashboard tool, called Experian Safeguard, for local authorities, NHS trusts, ﬁr e services, and major charities to help them prioritise those most in need during the pandemic. Developed in just two week s, it enabled the identiﬁcation of geogr aphic areas wher e vulnerable people liv ed, allowing targeted community c are to be deliver ed to them. Protecting people’s credit scor es Along with Equifax and T ransUnion, we helped implement a special measure c alled an 'emergency payment fr eeze' to ensure that an individual’s curr ent credit scor e is protected for the duration of an agr eed payment holiday with their lender . Helping disadvantaged school children get online We’r e helping close the ‘digital divide’ , between families with laptops and internet access, and those without, whose school -aged children have been struggling to keep up with online classes during the pandemic. Over all, for the UK and Ireland we donated £170,000 for student laptops, of which £100,000 was used to match donations from Mail F orce's ‘Computers F or Kids’ campaign via The Big Give, helping to raise £200,000 for the initiative. 13 Experian plc Annual Report 2021 Strategic report EME A / Asia Paciﬁc EMEA Educating businesses on urgent issues Across the EMEA r egion we helped businesses address ur gent issues arising from the pandemic through a series of dedic ated webinars on: fr aud prevention, supporting small and medium-sized enterprises, debt defence and collections strategies, the ‘new normal’ for digital, and the economic r eboot and impact on regulation. The Netherlands Assessing portfolio risk We wanted to help our clients quickly and accurately ﬁnd and mitigate risk in their portfolios, by pr oviding an innovative Portfolio Health W eb Data Check. This helped them identify which of their SME clients may be aected by the pandemic, giving our clients a chance to proactively pr otect their business while still supporting their clients in the most fair and appropriate way , helping to minimise the impact of COVID-19. South Africa Improving people’s lives through ﬁnancial literacy We partner ed with Rhiza Babuyile, a local NGO, to launch a progr amme focused on incubating entrepr eneurs based in the townships of Ky amandi and Fisantekraal, Cape T own. We pr ovided consulting assistance to ten entrepr eneurs, who each have four to ﬁve dependents, in the form of a business assessment and one-on-one coaching. Plans are to continue the coaching and add masterclasses and tr aining workshops. Italy Guiding businesses and supporting them to react quickly By providing fr ee feasibility studies for businesses we’ve helped them to analyse current market conditions, assess the impact of change on their portfolios and decision-making processes, and identify critical issues and suitable solutions. Asia Paciﬁc Supporting the next level of customer experience With the surge in demand for digital services from consumers Experian has been pr oviding businesses with extra support via cloud-based and on-premise solutions, as well as helping to protect against fr audsters, whether that is to dierentiate legitimate consumers fr om fraudster s, or swiftly r espond to emerging fraud thr eats. Thailand, Vietnam and Sri Lanka Keeping consumers connected during uncertain times Supported leading telecommunications companies, allowing them to r apidly provide assistance to their subscribers to minimise ﬁnancial impacts and lockdown/movement controls of the COVID-19 outbr eak. Staying connected during movement control restrictions has pr oven to be critical, allowing 3.2 million consumers to gain access to essential services like food supplies and in managing the psychological eects of isolation. India Employee Relief F und and fundraising drive to support colleagues and their families. We extended our Employ ee Relief F und to help our employees and their families cope under harsh pandemic conditions. W e also provided homecar e support, extended health insur ance, COVID-19 test cost reimbur sement and business-wide well-being and mindfulness sessions for our teams in India. A 48-hour fundraising drive sa w colleagues across all ourregions making personal donations, which were in turn fully matched by the Compan y . Experian committed a further US$600,000 towards charitable eorts to pr ovide emergency r elief across India. Helping consumers manage their ﬁnancial anxiety Our free cr edit reports enabled people to take control of their ﬁnancial health. Malaysia Credit education and tools for consumer s and businesses Since the start of the pandemic we have provided consumers with fr ee access to credit health monitoring services and businesses with free access to cr edit risk management, digital customer r elationship management, secur e ﬁle sharing and stor age, and business analysis tools. Singapore Supported small businesses We pr ovided complimentary cre dit m oni to rin g for 500 local businesses, helping them to embrace digitalisation and be r eady to address business continuity challenges. 3. 2 million consumers gained access to essential services like food supplies US$ 600 , 000 emergency r elief across India Experian plc Strategic r eport 14 Our investment c ase A unique pr oposition We ar e a global technology company and a leader in data and analytics. Our data assets, both for businesses and consumers, are extensive. We have global r each and the capability to constantly innovate to fulﬁl new and emer ging needs. The global COVID-19 pandemic has further acceler ated the existing revolution in data, analytics and digitisation, and we are in a unique position to react to these tr ends. We tak e a client-ﬁrst appr oach to product inno vation, creating new products by investing in people, data and the science of data interpretation, aided by advanced technologies such as artiﬁcial intelligence, big data and machine learning. Through this, we aim to create a better tomorr ow by impro ving the ways consumers and businesses can contr ol their ﬁnancial well-being and seize new opportunities. Experian’s roots ar e in providing cr edit information and assessing lending risks. This is still the foundation of our business but we also do much more – for lenders, individuals, telecommunications companies, governments, the automotive sector , US healthcar e providers and man y other industries. Our sc ale and diverse portfolio provide gr eat resilience, helping us tackle unfor eseen circumstances, such as a global pandemic, with conﬁdence. We ha ve mapped the addressable markets f or Experian and they are signiﬁc ant, estimated at US$130bn and gr owing. These markets are driven b y accelerating digital adoption, the shift towards automated services, the growing requir ement for customer authentication and consumers needing to access and manage their credit. W e target and allocate capital acr oss our strategic focus ar eas to make credit and lending simpler , transform ﬁnancial liv es, and help businesses to combat fr aud and to ﬁnd customers across the segments in which we oper ate. We ha ve developed detailed plans to pursue these opportunities. We ar e ﬁnancially well positioned, with a strong balance sheet and funding liquidity , and a pr oven recor d of converting oper ating proﬁt to c ash. This allows us to focus on key in vestment areas, balancing shareholder r eturns with the need for constant innovation, as well as investing in or ganic business growth while also pursuing str ategic acquisition opportunities. W e are a l eade r in g loba l in forma ti on ser vic es wit h stro ng pos iti ons i n gr owi ng ma rk ets We are a leader , holdi ng the number one or t wo positions in our larges t markets – the USA , Brazil and the UK. We have a div ersiﬁed portfolio of busi ness es across dierent sec tors and regions, op erating in 44 countries . Our busines s model is scal able , allowing us to grow revenues quickly at l ow incremental cost. We achieve signiﬁc ant syner gies across our oper ations, by combining data sources, integrating analytic s and using technology to oer dier enti ated propositions . W e invest continuall y to secur e opportunities across speciﬁc a ddressable markets , which we have estimated at U S $ 13 0 b n . T hese ﬁve s trengths combine to create a strong basis fo r futur e grow th . Strong found ations su ppor t our g row th potential We continually invest in pr oduct innovation and new sources of data , to address changing macr oeconomic factors and emerging mark et opportunities. We have dir ect relationships with over 100 million consumer s, a situation unique in our industry . This pr ovides a mechanism for us to engage directly with millions of people. We have demonstr ated our ability to adapt quickly to meet the changing needs of our clients in unforeseen mark et conditions. We have gr eat potential to introduce and expand our services in all of our markets over the longer term. We are incr easing our product oering in growing industry segments such as US healthcar e and automotive, and in expanding mark ets such as Brazil. We remain ﬁnancial ly well positioned We hav e aver aged 6% annual organic revenue gr owth 1 since we became an independent listed company in 2006, sustaining positive organic gr owth through all macr oeconomic conditions, including both the 2007 /2008 global ﬁnancial crisis and the 2020/2021 COVID-19 pandemic to date. Mor e detail is available in the Financial r eview section of this report on page 62. Much of our revenue is highly r ecurring , as many of our pr oducts and solutions are mission critic al and an integral part of our clients’ operating pr ocesses. We ar e a highly c ash-generative, low capital intensity business. Our Benchmark EBIT to Benchmark oper ating cash ﬂow conver sion rate 1 has aver aged 99% since 2006. We mak e the best use of the cash we gener ate, balancing the need for organic inv estment in innovation and acquisitions with returns to shar eholders, through dividends and shar e repur chases. Strategic report 1 P leas e ref er to n ote 6 to t he Gr oup ﬁn ancia l sta tem ent s for de ﬁnit ion s of org anic r eve nue gr ow th an d Ben chma rk EB IT to Benchmark operating cash ﬂow conversion. W e plac e a str ong emp ha si s onEn vironm ent al, Socia l and Go v ern anc ec rit eri a We transform ﬁnancial lives b y helping people take control of their ﬁnancial status – through our cor e oering, Social Inno vation products and community investment. We safeguard futures by pr otecting our customers and their families from identity theft and fr aud. We are intr oducing innovative ways for those who lack basic ﬁnancial services to gain access to credit , for example through use of alternative data sources and ﬁnancial educ ation progr ammes. We help to protect the envir onment and manage the risks of climate change . W e have consistently reduced our c arbon footprint year-on- year and ar e committed to being carbon neutr al in our own operations by 2030. We are committed to being a diver se and inclusive organisation, at all levels and across all r egions. We have established detailed targets to achieve this, as set out in the En vironmental, Social and Governance (ESG) section of this report on page 38. 15 Experian plc Annual Report 2021 Experian plc Strategic r eport 16 Ke y performance indicator s A r esilient performance Aga inst a ch alle ngi ng external back drop, we launc hed man y new products, suppor ted ou r emplo yees, and helped man y who were ﬁn ancial ly im pacted by the pande mic. The strength of our bu si ness per formance is e videnced by a range o f key performance ind icato rs. Se e pag e 1 1 7 – Re venu e per fo rman ce is li nked to d irec tor s’ remu ner atio n Se e pag e 1 1 7 – B ench mark E BI T is a d irectors’ remuneration measure Se e pag e 1 1 7 – R OCE i s a dire ctor s’ remuneration measure Se e pag e 1 1 7 – A djus ted B ench mark E PS is a d irectors’ remuneration measure Or ganic reve nue gr owth Benchmark EBIT an d Benchmark EB IT margin 1 Ret urn on capital em ploy ed (ROCE) Benchmark earnings per share ( EPS) 4 % US$ 1, 3 8 5 m 2 5 .9 % 15 . 0 % USc 1 0 3 .1 Why is this important? It is a measure of our ability to provide innov ative propositions and services for clients and consumers, and to extend these into new industries and across many geogr aphies. Aim T o consistently achieve mid- to high single-digit organic r evenue growth. Analysis Organic r evenue grew 4%, with the main contributors being North America 7% and Latin America 9%, including very strong contributions from Consumer Services. Why is this important? It measures how well we turn our revenue into pr oﬁts, allo wing us to generate r eturns for shareholders, and to reinvest f or future gr owth. Aim: T o oper ate our business eciently and cost eectively with stable EBIT mar gins. Analysis: W e protected our people, made the conscious decision to invest in marketing for Consumer Services, and continued our innovation and technology modernisation progr ammes. Overall, for the Gr oup, Benchmark EBIT was US$1,385m, up 3% at constant exchange rates and ﬂat at actual r ates. Benchmark EBIT margin w as 25.9%, down 80 basis points before the impact of for eign exchange rates, and down 100 basis points over all. Why is this important? It measures how eectively we have deployed our r esources and how eciently we apply our capital. Aim: T o gener ate good returns on the investments we make and cr eate long-term value for shar eholders. Analysis: Our decision to sustain organic investment and to pursue attr active acquisition opportunities reduced ROCE in FY21. This year , ROCE was 15.0%, down 110 basis points on the prior year . Why is this important? EPS measures our success at generating surpluses and v alue for our shareholders. Aim: T o achieve earnings gr owth for shareholders while balancing r einvestment to secure futur e growth opportunities. Analysis: Benchmark EBIT fr om ongoing activities was up 3% at constant exchange rates, driven by our organic revenue gr owth performance. Our Benchmark net ﬁnance costs decreased to US$121m, and Benchmark tax rate was up 10 basis points at 25.9%. With weighted aver age numbers of shares at 910m, this resulted in Benchmark earnings per shar e of 103.1 US cents. This was ﬂat on the prior year at actual exchange r ates and up 4% at constant currency . 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % 4 8 9 5 5 202 1 2 0 20 2 0 1 8 1 2 0 1 9 2 0 1 7 % 15.0 16.1 15.9 15.5 15.5 202 1 2 0 20 2 0 1 8 1 2 0 1 9 2 0 1 7 USc 10 3 .1 1 03.0 98.0 94 . 4 88.4 202 1 2 0 2 0 2 2 0 1 8 3 2 0 1 9 2 0 1 7 % 25 .9 2 6 .9 2 6 .9 2 7. 1 2 7. 6 US$m 1, 3 8 5 1, 3 8 6 1, 3 0 6 1, 2 41 1,19 7 1 From ongoi ng activities. 1 Re st ated f or IF RS 15. 1 Re st ated f or IF RS 15. For a r ec onci liat ion of r eve nue f rom o ngo ing ac ti vit ies , incl udin g dis clo sure o f org anic an d ac quisi tio n rev enue , fro m the y ear en ded 31 Ma rch 20 20 to 31 Mar ch 2021 s ee p age 165. 3 Re st ated f or IF RS 15. 2 Re sult s fo r FY 20 are r e- pre se nted f or th e rec las siﬁ cat ion to e xit ed bu sine ss a cti vit ies o f cer ta in B2B bu sine ss es . 17 Experian plc Annual Report 2021 Strategic report Se e pag e 1 1 7 – C umul ativ e Ben chmar k ope rat ing ca sh ﬂow is a d irec tor s’ remu ner atio n meas ure Se e the E nviro nme ntal , Soc ial and G ove rnan ce (E SG) se cti on on p age s 38 to 56 f or fu rt her inf orm atio n on how w e’ve be en lo okin g af ter an d lis tenin g to empl oye es thi s year For f ur the r infor mat ion pl ease r efe r to the Su sta inabl e Business repor t at ww w.experianplc.com/ sbrepor t Benchm ar k ope rating c ash ﬂo w and ca sh ﬂow c onvers ion Employee engagement Greenhouse gas emissions ( 000s CO 2 e 1 to nn e s) 10 6 % US$ 1 , 476 m 1 6.8 Why is this important? Cash ﬂow gives us the capacity to oper ate, and r einvest. The eciency with which we convert proﬁts into c ash ﬂow is measured by c ash ﬂow conversion. Aim: T o con vert at least 90% of Benchmark EBIT into Benchmark oper ating cash ﬂow . Analysis: Cash ﬂow performance was str ong this year with Benchmark oper ating cash ﬂow of US$1,476m, up US$262m on last y ear . The increase is due to changing r evenue mix, str ong control and phasing of working c apital, and deferred infr astructure investment. Why is this important? An engaged and motivated workfor ce helps us to develop exciting new propositions and ﬁnd new opportunities while appropriately managing risks. Aim: T o ensur e Experian is a great place to work and that we can attr act and retain the best people. Analysis: This year has been challenging for everyone, including our 17,800 employees with the majority working remotely due to COVID-19 related oce closur es. F or many , it has been a period of adjustment and adaptation. W e have been dealing with the uniqueness of remote working and sometimes unanticipated mental health consequences such as loneliness and anxiety , as well as other added challenges such as having to home-school children. We have therefor e focused very str ongly on our colleagues’ mental and physical wel l-being throughout the year . T o stay in touch we have conducted more fr equent and ﬂexible pulse surveys, rather than our tr aditional single annual survey . Survey r esults show that: On average acr oss all pulse surveys, 75% of employees responded fa vourably to ‘I am feeling physic ally and mentally well’ On average across all pulse survey s, 88% of employees responded fa vourably to ‘I am able to be productive in my curr ent work set up’ . We plan to continue this appr oach into FY22 as more fr equent sampling and direct employ ee feedback helps us to ensure we fully tak e account of our people’s needs and enables us to make decisions in a timely manner . We will also conduct our more extensive annual survey in June 2021. Why is this important? It measures the c arbon emissions we generate, as we have a responsibility as a business to r educe our carbon footprint and r espond to the climate change emergency . Aim: T o r educe our carbon emissions with the goal of becoming carbon neutr al in our own operations by 2030. Analysis: T o become carbon neutr al , we need to reduce our dir ect emissions and take further action by becoming more ener gy ecient and switching to renewables wher e possible. Once we have reduced our f ootprint as far as possible, r emaining emissions should be oset. In 2020, we committed to gr adually carbon oset our Scope 1 and 2 emissions by 2025. FY21 is the ﬁrst year for which we’ll oset a portion of our emissions, osetting 20% of our emissions with the end goal of reaching 100% in FY25. This year , as a r esult of lockdowns and most of our sta working from home, we have seen a decrease in our Scope 1 emissions by 27% to 2.2 thousand tonnes of CO 2 e and Scope 2 emissions by 35% to 14.3 thousand tonnes of CO 2 e. Equally we ha ve seen a decrease in air tra vel emissions (Scope 3) by 98% to 0.3 thousand tonnes of CO 2 e. W e continue to work on making eective long-term changes in our business, to r educe our carbon footprint. For more information on our appr oach and next steps to achieve this, see page 54. Se e not e 6 to the G rou p ﬁnan cial s tate men ts fo r deﬁ niti ons o f the se no n- GA AP m eas ures : org anic r eve nue gr ow th, B enc hmar k EBI T, Benc hmar k EB IT mar gin , ROC E, B ench mar k ear ning s per s hare , and Be nchm ark o per ati ng ca sh ﬂow a nd ca sh ﬂow c onv ersi on. 202 1 2 0 20 2 0 1 8 1 2 0 1 9 2 0 1 7 % 10 6 88 97 96 96 US$m 1, 476 1, 2 14 1, 2 7 0 1,19 6 1,14 9 1 Re st ated f or IF RS 15. 1 C O 2 e = CO 2 -e quivalent. 2 S cop e 1 cov ers di rec t emi ssi ons su ch as ga s con sump tio n an d dies el us ed in g ene rato rs or c omp any c ars . Sco pe 2 (mar ket- bas ed) c ove rs in dire ct em iss ions f ro m the generation of purchased electricity, steam, heating a nd co olin g cal cul ate d usin g supp lie r issu ed o r res idual e mis sion fa cto rs. W he re sup pli er and r esi dual e mis sion f ac tor s are no t ava ila ble, w e use l oca tio n-b ase d emi ssi on fa cto rs. S cop e 3 inc lud es ind ire ct em iss ions f rom o ur va lue ch ain. O ur cur re nt Sc ope 3 r epo r ting o nly in clud es em iss ions f rom a ir tr avel (usi ng DE FR A conv ers ion f act ors . F Y21 air tr ave l emis sio ns wer e cal cul ate d usin g rele van t RF emis sio n fac tor s. P rio r to F Y21, non -RF e miss ion f act ors w ere u sed ). Act ual em iss ions fr om oth er S cop e 3 emis sio n cate gor ie s are b eing c alc ula ted, es tima ted e mis sion s are in clu ded in t he Pe opl e and E SG se cti on on p age 5 6. 3 C arb on in tens it y: CO 2 e emi ssi on pe r US$1 m of re ven ue. 4 C O 2 e emi ssi on pe r ful l-ti me eq uiv alent ( FT E) e mpl oye e. F TE e mplo yee s as at 31 Ma rch 20 21 . 5 T he 2017 calc ula tion i nclu des C CM w hich ha s be en re cla ssi ﬁed a s a dis cont inue d op erat ion . 6 T he 2018 inte nsit y me tri c bas ed o n reve nue w as re sta ted fo llow ing t he ad opti on of I FRS 15. Met ric r ep or ted in o ur 2018 An nual Re por t : 1 0 .8 to nne s of CO 2 e pe r US$m r eve nue. 0 10 20 30 40 50 60 2021 2020 2019 2018 2017 0 2 4 6 8 10 12 2021 2020 2019 2018 2017 CO 2 emissions (T onnes CO 2 e) CO 2 emissions (T onnes CO 2 e) 4.4 11.9 3.9 9.9 3.6 8.9 3.0 2.2 14.3 7.8 3.1 22.1 15.2 25.6 14.3 28.0 14.1 34.2 12.8 Scope 1 CO 2 e emission per US$1m of r evenue (tonnes) Scope 2 Scope 3 CO 2 e emission per full -time equivalent employee (tonnes) Scope 1 CO 2 e emission per US$1m of r evenue (tonnes) Scope 2 Scope 3 CO 2 e emission per full -time equivalent employee (tonnes) Experian plc Strategic r eport 18 Market tr ends Understanding our k ey market tr ends T rend Economies have digitised at a time when personal ﬁnances have become much mor e stressed. Consumers want to save money . They also want to protect their data and they are often faced with bewildering levels of choice online. They expect digital interactions to be smooth, intuitive and fast, whether making purchases or applying for cr edit. New trends ar e also emerging and, with a growing awareness of the v alue of their data, consumers are incr easingly willing to shar e data in exchange for discernible value. Businesses on the other hand have to work harder than ever to ﬁnd, serve and retain customers in this hyper -connected digital world. Our response We hav e established direct r elationships with more than 100 million consumers globally . We ar e introducing new services that meet their changing demands, helping them manage their ﬁnances more eciently – on any device, at an y time, an ywhere – and placing them in control. We pr ovide our business clients with data and analytical tools so they can under stand who they are inter acting with, help them make better and faster decisions about which services to oer , while also minimising the risk of fraud. Our Ascend Analytical Sandbox is an advanced analytics envir onment which allows our clients to access deeper insights, data visualisations, and business intelligence. It combines Experian credit data, the customer’s data, and other data sources such as industry-speciﬁc feeds. As consumers consent to data sharing to unlock value, we are adding new modules and datasets to the product, enabling more powerful insights. We constantly develop new pr opositions to take account of changing behaviours. In Health, incr easingly healthcar e is shifting out of the traditional hospital setting and into settings that are mor e cost eective and convenient for patients. W e have introduced oers which co-ordinate digital c are, while also helping to authenticate and identify patients before they embark on tr eatment. 1 2 3 5 T rend The global population is set to continue growing, with an increase of two billion people expected in the next 30 years. Emerging markets ar e becoming key drivers of economic growth over the medium to long term. Currently , ther e are around 1.7 billion adults globally who are unbanked. Huge numbers of people in the developing world have no access to formal ﬁnancial services, while in more developed countries, large segments of the population may have ’thin’ or no credit proﬁles. This can r educe people's access to credit and to mainstr eam ﬁnance because they may be ‘invisible’ to the industry . Our response We ar e developing new technologies to help people gain access to ﬁnancial services at fair and aordable r ates. Many products support the millions of credit invisibles. Experian Lift, our new service in the USA, dr aws on extensive data sources to enhance predictions of cr editworthiness. Our new Atlas platform has the potential to improv e access to credit for one billion under -banked people in Asia Paciﬁc. It combines technology with non-traditional datasets such as telecommunications, rental or ecommer ce data to help lenders assess risk cost eectively . This c an help more people to get fairer access to cr edit. In the UK, our new Credit Limits service enables consumers to check the limit they are likel y to be oered before applying for a new cr edit card, without impacting their credit r eport. Experian Boost has helped over four million people in the USA instantly improv e their credit scor es, adding positive data about on-time payments of utility bills to their ﬁnancial proﬁles. In November 2020, we also introduced Experian Boost to the UK to help people improve their cr edit scores. In Brazil, we built a positive data bureau in response to legislation in 2019 that means positive payment histories (recor ds of bills paid) can now be used in cr edit assessment. We hav e developed a range of new positive data services which we have been launching through the year , and currently ha ve 96 banks contributing data. W e believe that of the 157 million adults in Brazil, we can assist 137 million with positive data products, either by enabling their access to credit they would not have had previously , or by allowing them to access credit at r educed interest r ates. 2 4 5 Make credit and lending simpler , fasterand safer for consumers andbusinesses Empower consumers to improve their ﬁnancial lives Help businesses verify identity andcombat fraud Help organisations in specialised vertical mark ets harness data and analytics to make smarter decisions Enable businesses to ﬁnd, understand and connect with audiences 1 2 3 4 5 Strategic focus areas The COVID - 1 9 pandem ic ha s cataly sed many o f the trend s that hav e been shap ing ou r mark ets for some time. Peopl e hav e rapidl y adopted d igita l ser vices and th is in turn is tran sforming the wa y tha t busi nesses operate so that the y may better ser ve thei r custome rs. T o operate eectively i n the digital sphere, org anisation s need to in vest in smoo th dig ital jou rneys and autom ate p rocesses , as we ll as cont end with h igher l evels of onli ne fraud. These trends have been on our rada r for a nu mber of ye ars. For m any y ears we ha ve in ves ted i n strategies t o meet these needs and thi s position s us well. That sai d, the COVID- 1 9 pa ndemi c has requ ired us to ad apt, whi le also opening u p new oppor tunities for expansion. COVID-19 and counter-cyclic al response In the short term, we will continue to face macroeconomic pr essures as well as lockdo wn uncertainty in a number of our regions. However , our business beneﬁts fr om counter-cyclic al drivers, segments which prosper when economic conditions ar e depressed. W e also have businesses in the portfolio which are less susceptible to economic downturns. Consumer Services, Health and Mortgage are examples of business segments which grew this year and which contributed to our resilient performance. We also adapted some of our pr opositions to help our customers deal with the uncertainties created by the pandemic. In total , we launched 158 innovations during the year , many of which were dir ectly linked to these needs. These included propositions in ar eas such as fraud prevention and debt collections, as well as new attributes and scores to help our customers make better lending decisions, including recovery scor es, downturn triggers and loss-forec asting capabilities. Changes in c onsumers ’ digital b ehaviour Population an d weal th 19 Experian plc Annual Report 2021 Strategic report T rend As the world moves increasingly online, the amount of data available is gr owing at an extraor dinary pace. Of all current data, 90% has been created in the last two year s, and 127 new devices connect to the internet every second. As well as the incr eased amount available, it is becoming cheaper for businesses to store, manage and analyse data. However , these businesses need to understand the many data sour ces available to them in order to impr ove decision-making. New data sources, made available thr ough open banking in the UK and USA, and positive data in Brazil, are giving organisations access to rich, up-to-date information. However , to optimise opportunities in these challenging times, businesses need to embr ace advanced analytics tools, c apable of connecting disparate datasets and making the information more usable. Our response We develop solutions to oer sophistic ated platforms to help clients take advantage of data prolifer ation. For example, Ascend Intelligence Services uses AI and machine learning to support continuous improvement of strategic models for clients. This frees up data-scientist time from model building and monitoring activities, it means data c an be integrated into models faster , and produces an endpoint that can be utilised by PowerCurve and Experian One. It c an also oer real -time market insights, benchmarking and health monitoring. We ar e evolving our analytics portfolio in response to client demand for a shift towar ds cloud-based products. W e are investing in a roadmap of innov ation to evolve from a lar gely on-premise softwar e business towards a cloud-ﬁrst, digital -ﬁrst, API-enabled and scalable platform business. This transformation is well underw ay and began with our investments to unify and standardise our product suites, easing the process of scaling these globally . For e xample, PowerCurv e migration to the cloud provides an adaptable platform that enables decisions to be designed to client needs and combines rich data and advanced analytics to drive decisions at scale. The modular design oers agility , and our continual augmentation of machine learning into the platform can bring gr eater connectivity to the businesses we serve, with frictionless experiences for their consumers. 2 3 4 5 T rend Businesses in all industries are looking to AI and machine learning to automate processes in order to oper ate more eciently , and secure pr oductivity gains. New technologies are r evolutionising industries, and businesses are investing to r emain competitive, with over 95% of Fortune 1000 or ganisations stating they are investing in big data and AI. Automation can personalise customer experiences, mak e online transactions simpler , automate logistics and optimise business decisions, allowing companies to generate signiﬁc ant eciencies and redeploy their sta to do jobs which requir e a higher level of human input. Our response We ar e tr ansforming our technology stack to a modern, r esilient, sc alable and secure cloud-based architectur e to accelerate product delivery to clients. Investment in the best technology is critical to the way we ingest, stor e and secure data, as well as to the way we develop and deliver our products. It is one of the critical factors in how we c an maintain and extend competitive advantage. T echnology enables us to link Experian and third-party data assets to cr eate innovative products. In addition, we use technology to enhance our own processes, which has impro ved productivity . It has allo wed us to reduce our conventional cost base and release funds f or investment in new opportunities, such as further innovation. F or example, we continue to invest in our RP A (Robotic Process Automation) capability and have automated 377 of our key processes, equating to more than 350 years of manual activity time saved since project inception. 1 4 5 T rend Regulators ar e becoming increasingly mor e active in protecting consumer data and privacy rights, and there ar e now signiﬁcant ﬁnancial and reputational consequences for non-compliance. Cyber crime is also increasing, and there is much gr eater scrutiny of data protection. As data custodians, businesses hav e a responsibility to safeguar d consumer privacy . We believe we c an help our clients and consumers meet their responsibilities in this more demanding envir onment. Regulators ar e opening up banking and other data-rich industries, encour aging consumers to ensure they get the best possible deal. Our response We work with r egulators to ensur e we comply fully with all new regulations, and engage in public debate to ensure policy -makers take into account our views and those of our industry . W e develop new services to help our clients remain compliant with r egulations that aect them. Protecting consumer privacy and inf ormation security is extremely important to us. We have progr ammes that evaluate every product and service to ensur e we strike the right balance between consumers’ privacy expectations and the economic beneﬁt to both consumers and clients. F urthermore, we ar e channelling investment into our multi-layer ed and extensive information security progr amme to manage and protect against cyber security risks, by continually upgr ading our security infrastructur e in an ever- changing environment. Accurate data is fundamental to our reputation and business success. W e constantly strive to increase the accur acy of our data in a competitive market, to ensure customers can have conﬁdence in the services we provide. 2 3 4 90 % of all data has been created in the last two years 95 % of Fortune 1000 organisations state they ar e investing in big data and AI 12 7 new devices connect to the internet every second Proliferation of data Adva nces in automatio n and technology A changing regulat or y environm ent Experian plc Strategic r eport 20 Our business model W e play a vital r ole in connecting people and business thr ough data and technology We beli eve da ta has t he power to t ransform lives and crea te a better tomorrow . We c ombi ne our inno vative t echnol ogy with data t o drive economic growth, supporting jobs and pro sperit y . With our expertise in data a nd tech nology we are ide all y placed to lin k people and org ani sations, help ing them i nteract more easil y. We he lp creat e oppor tu nities for people t o improve thei r lives and for organ isatio ns to ma ke fast er , smar t er decis ions. W e do thi s by transformi ng data int o in format ion, and by dep loying adva nced techn ologies, platforms and an alytics. What we do Providing essential serv ices for people and organisation s W e help people better understand their ﬁnancial position improve access to ﬁnancial services enjoy a quick and seamless online service Organisations c an deliver services to consumers with greater speed and eciency make fairer , better-informed and more r esponsible decisions become more ecient and r educe costs 1 7, 8 0 0 employees globally Fo u r reporting r egions: – North America – Latin America – UK and Ireland – EMEA/Asia Paciﬁc USA , U K and Bra zil are our lar gest and longest- established markets 44 countries where we have oces Tw o main segments: – Business-to-Business – Consumer Services See page 21 for more information on Business-to-Business and Consumer Services. Big data analytics Ascend T echnology Platform: data on demand and sophisticated analysistools. DataLabs: advanced data anal ysis, and resear ch and development by data scientists. Decisioning Manage and automate large volumes of decisions and processes, on-premise or in the cloud. PowerCurve: customer decision management for connecting analysis and operations. CrossCor e: fr aud prevention. Financial education Access to credit r eports and scores, identity monitoring and protection as well as comprehensive awar eness and education progr ammes. Fr ee consumer membership base of 110m people. Product c omparison Credit Match/Cr edit Matcher: consumers can understand which credit car d, per sonal loan, mortgage or automotive insurance pr oducts they will most likely qualify for and beneﬁt from using. Online debt negotiation With Limpa Nome in Brazil consumers see all their own past-due debts in one place and negotiate more achievable repayment plans with lenders. Core data platforms Collect, sort and aggr egate datafromtens of thousands of traditional and alternative sources and tr ansform it to provide a range of information services. Open data platforms Open Banking: facilitating consumer-permissioned sharing of data from their bank account with other parties. Consumer-contributed data Consumers adding their own data to their credit ﬁles. 6.7m consumers connected with Experian Boost in the USA and over 5m consumers with Serasa Scor e T urbo in Brazil. Helping business to make faster , smarter and better decisions Using data to help the most vulnerable in society and supporting economic growth Empowering people to better understand their ﬁnancial position, tak e control of their ﬁnances and manage their ﬁnancial health 21 Experian plc Annual Report 2021 Strategic report A detailed look at what our busi ness segments do and how they generate reve nue What we do We pr ovide businesses with information to help them to understand and develop relationships with their customers, to build their businesses and to manage the risks inside their organisations. W e build and manage large and comprehensive databases containing the cr edit activity and repayment histories of millions of consumers and businesses. W e collect, sort and aggregate data fr om tens of thousands of sources and tr ansform it to provide a range of information services. Or ganisations analyse and use this information to make decisions about lending and the terms on which to lend. What we do We dr aw on the depth and breadth of our credit information databases and on other information, including clients’ own data, to develop pr edictive tools, sophistic ated software and platforms. These all help businesses and organisations manage and automate large volumes of decisions and processes. Our services help our clients improve the consistency and quality of their business decisions, in ar eas including credit risk, fr aud prevention, identity management, customer service and engagement, account processing, and account management. What we do We pr ovide credit education and identity monitoring services directly to millions of consumers in the USA, Br azil, UK, South Afric a, Peru, Colombia and India. Our services for consumers include free access to their Experian credit r eport and score, and useful online educational tools. In the USA and UK we enable people to contribute their own data to their ﬁle, for example utility , mobile payments and streaming services, to help them impro ve their credit scor e. We oer comparison services that show consumers a choice of relev ant and available cr edit car d, personal loan, mortgage, automotive insurance and other deals. In Brazil, our online recovery portal, Limpa Nome, lets consumers see all their own past-due debts in one place, and negotiate mor e achievable repayment plans with lenders. Busi ness-to-Business Data De cisioning Consumer S er vices Link to our strategic f ocus areas See page 28 and 34 Link to our strategic f ocus areas See page 28 and 32 Link to our strategic f ocus areas See page 30 1 1 4 2 3 Ke y customers Banks, automotive dealers, retailers and telecommunication companies Ke y customers Financial services, r etail, US healthc are, telecommunications, utilities, insur ance and FinT ech Ke y customers Consumers, lenders and insurance pr oviders Rev enue model Primarily transactional with some contributionfrom licence fees Market position Number one or number two in our key markets Main competitors: Equifax, Tr ansUnion, Dun & Bradstr eet , BoaVista, LiveRamp andEpsilon Rev enue model Software and system sales: consultancy and implementation fees; recurring licence fees; and transactional char ges Credit scor es sold on a transactional, volume-tiered basis Analytics: a mix of consultancy and professional fees, as well as transactional revenues Market position Market-leading pr ovider of business solutions in key markets except for the US A Main competitors: FICO , IBM, SAS and Change Healthcar e Rev enue model Monthly subscription and one-o transaction fees Referr al fees for credit pr oducts White-label partnerships Market position We ar e the market leader in Br azil and one of the market leaders in the USA and the UK Main competitors: Intuit, NerdWallet, Lending T ree, ClearScor e, Equifax and T ransUnion How we add value W e aggregate data from many sour ces and turn it into information that can be used for many dierent purposes W e help provide lenders with a comprehensive view of a consumer’s ﬁnancial situation Information is used to support impartial credit decisions, broaden access to cr edit and promote fair and r esponsible lending W e also provide marketing data relev ant to consumer lifestyles which helps businesses understand their customers better and serve them with tailored pr oducts How we add value Assessments of cr editworthiness, suitability and aordability of loans support responsible lending F aster , frictionless and better -informed decisions help improve customer experience Relev ant insights into new and existing customers support more eective management and better engagement with customers Authentic ation of customer identity helps prevent identity fr aud and other crime How we add value Support consumers in taking contr ol of their credit, improving their ﬁnancial well -being and achieving their ﬁnancial goals Pr ovide immediate tangible results thr ough credit scor e improvement and renegotiation of debts Support eligibility for , and impro ved access to, cr edit oers and other services Impr ove navigation of major ﬁnancial decisions, such as buying a home Impr ove detection of , and resilience to, identity theft and fraud A B C D A C B A. North America 1,761 B. Latin Americ a 457 C. UK and Ir eland 361 D. EMEA/Asia Paciﬁc 287 T otal 2,866 A. North America 694 B. Latin Americ a 92 C. UK and Ir eland 220 D. EMEA/Asia Paciﬁc 178 T otal 1,184 A. North America 1,075 B. Latin Americ a 76 C. UK and Ir eland 156 T otal 1,307 1 Revenue from ongoing activities. A B C D Data re venue ¹ (U S$m) Decisioning rev enue ¹ (US$m) Consumer Serv ices revenue ¹ (US$m) Experian plc Strategic r eport 22 We i nv est in a num ber of ke y areas t o sustai n and g row our co mpetitive l ead. Data is the foundation of our business. Worldwide we hold and manage the credit history and r epayment data of 1.3 billion people and 166 million businesses. W e focus on ensuring we continue to have the best datasets available, alongside the best products to help our clients make sense of their data. Safeguarding data security: we oper ate a multi-faceted approach to ensur e that data is held securely . This appr oach focuses on prevention, detection and mitigation. Improving data accuracy: we constantly strive to increase the accuracy of our data. We use data fr om reputable sour ces, we measure accur acy continuously , and we hav e improvement progr ammes and processes that quickly correct inaccur ate data. Protecting data privacy: we have progr ammes to evaluate every product and service to ensur e we strike the right balance between consumers’ privacy expectations and the economic beneﬁt to both consumers and clients. Ensuring data transparency: we oer consumers the ability to review the data that we hold and, where appr opriate, to opt out of further processing or sharing of data for particular uses. We ha ve relationships with millions of consumers. We empower people to use data to support their ﬁnancial well-being. W e have pioneered new way s to give people greater contr ol over their data and give them the conﬁdence to ﬂourish ﬁnancially . Our business model contin ued What mak es us dierent? 11 0 m Direct r elationship with consumers across the USA, Br azil and the UK 23 consumer and 12 business information bureaux globally Robust security controls based on ISO 2 7 0 01 See page 43 for more detail on these four ar eas. T raditional credit data New datasets Increase br eadth and depth of data More pr edictive Broader applic ations A cultur e of innovation Innovation has always been at the heart of our business and we employ some of the world’s leading data scientists and software engineers. We have a long tr adition of introducing innovative new pr oducts and we invest to maintain high standards of scientiﬁc excellence. It’s an important dierentiator for our business as well as being a signiﬁc ant growth driver . We ha ve introduced a formal pr ocess to embed a culture and framework of innov ation across Experian. We call it ‘A thena’ . Athena helps us to innovate and bring new pr oducts and services to market more successfull y . Our extensive data assets Consumers ar e at the heart of what we do We aim to be the consumer s’ bureau. W e have built our business on clear commitments. Monitor market trends Evaluate client needs Invest in the most promising initiatives Identify opportunities The Athena process 23 Experian plc Annual Report 2021 Strategic report 2030 carbon neutr al commitment 44 countries in which we operate 4 , 200 EMEA/Asia Paciﬁc Breadth and c ombination of capabilities Our greatest str ength comes from the combination of data with our advanced analytics and decisioning tools. This appr oach means we can often cr eate highly dierentiated services which ar e unique to Experian. W e work together and we proactively seek these opportunities across our or ganisation. Data & Analytics Consumer engagement Decisioning 3,30 0 UK and Ireland 7,1 0 0 North America 3, 20 0 Latin America See page 38 for more detail Organic investment in selected projects Shareholder returns Dividend payments Share r epurchase pr ogr amme when appropriate Inorganic investment through acquisitions balanced with Robust ﬁnancial performanc e and r einvestment We ha ve a disciplined approach to c apital allocation which balances investment in the business and returns to shar eholders in support of our strategy to deliver consistent gr owth. Investing sustainabl y We ar e committed to incorporating ESG factors into our investment decisions. W e choose to invest in products and services with the clear purpose of generating positive social impacts, alongside ﬁnancial returns. Our core pr oducts and Social Innovation products help improve access to credit to support ﬁnancial inclusion, impro ve ﬁnancial literacy , and prevent fr aud and identity theft. W e are also investing to lessen our environmental impact, reducing our carbon emissions through in vesting in more ecient technology , reducing our ener gy requir ements, and making more use of r enewable energy . This supports our commitment to be carbon neutr al by 2030 in our own oper ations. Underlying our commitment to sustainable investing is our investment in data privacy , security , accur acy and transpar ency , and our commitment to working with integrity . Our global footprint and employ ees We pr ovide our services to both multi-national and local clients. W e can develop new products in one market and tr ansfer them into others in a systematic and replic able way , helping us to export our most successful platforms and formats. Our 17,800 skilled employees work in 44 global operations acr oss six continents. Experian plc Strategic r eport 24 Clients’ needs include: better services for customers – faster and frictionless meeting regulatory requir ements Clients’ and consumers’ needs include: high-quality and accurate data data security consumer privacy access to credit and other services prevention of fraud and identity theft We work with our clients to understand their challenges and develop new products that help them solve pr oblems. We welcome their constructive feedback about our products and services, either informally or through our y early Net Promoter Scor e surveys. We engage with consumers via our fr ee platforms, pr oviding them with ﬁnancial education, useful tools, fr ee Experian credit r eports online and various other products. Consumers can r each us through our call centr es and we respond to their concerns on a range of issues, from access to cr edit, to amending data on their credit ﬁle, to identity theft. F or inaccurate data on cr edit ﬁles we have processes in place for consumers to review their data, raise a query and ha ve corrections made if needed. We help millions of people and thousands of businesses use their data more eectively – seizing new opportunities and taking greater contr ol. We help them by turning data fr om many sources into useful information they c an use. We cr eate powerful analytics and software, so they can mak e more-informed decisions. Communities need: business success, employment and job creation access to public services long-term asset creation in communities inclusion in mainstream ﬁnancial services and products a healthy environment in which to live We dr aw on all our resources – including our people, information and skills – to support communities worldwide in innovative and eective ways. These include the development of Social Innovation pr oducts, employee volunteering and partnerships and support for community groups and charities. We help people access cr edit and other ﬁnancial services, that they c an use to take control of their ﬁnancial circumstances and impr ove their lives. We help businesses pr osper , and to enhance their potential as local employers. People need: to feel valued for their contribution to feel supported, especially while working remotely to feel they make a dierence to society to contribute to our engaging, positive empowering culture training and learning career pr ogression job security We listen to our people’s view s, support a positive empowering culture and do all we can to make Experian a gr eat place to work. We encour age employees to use their skills to undertake interesting work. We give them the right tools to work eectively , learn new skills and develop their career s. We celebr ate great performance and ensure employees feel nurtur ed and supported throughout their car eers with Experian. Our work carries great r esponsibility , andhow we work is as important as what we do. We pr ovide employees with opportunities for growth thr ough tr aining, giving them a sense of purpose – an integral part of our organisational cultur e that has a positive impact globally . Why Why Why How How How V alue V alue V alue Our client s and consumers Our comm unities Our people 61 m people reached thr ough Social Innovation pr ojects Employee reported results from pulse surveys: 75 % favourable r esponse to ‘I am feeling physic ally and mentally well’ 88 % positive response to ‘I am able to be productive in my curr ent work set up’ US$ 12 m community investment 3.5 bn credit decisions supported facilitating billions of loans 2 1 , 000 hours volunteering 3. 2 bn microloans enabled 11 . 6 m conversations with consumers 390 k fraud victims supported Prevented fr aud of at least US$ 10 bn 58 % reduction in carbon emissions V alue creat ion for our stakeholders Our business model contin ued 25 Experian plc Annual Report 2021 Strategic report Suppliers want: long-term, collabor ative relationships business opportunities to mitigate market and ﬁnancial risks to meet regulatory requir ements We cr eate close and collabor ative relationships with key supplier s to ensure streamlined pr ocesses, performance, segmentation and qualiﬁcation. This helps us uncover and realise new value, increase savings and r educe costs and risk of failure. These close relationships also help us ensure we meet our compliance obligations. Many of our data contributors ar e also our clients. They supply us with data through a give-to-get model. Our ability to combine, clean, sort and aggregate data fr om thousands of data contributors creates a mor e complete picture of consumer or business interactions acr oss markets. Governments ar e conc erned about: generating prosperity managing economic cycles supporting their stakeholders’ ﬁnancial well-being compliance with regulations managing issues that aect consumers and businesses mitigating impacts and reversing climate change We develop constructive r elationships with policy-makers and r egulators. Our senior executives meet with legislators regularly to ensur e they understand the opportunities, v alue and challenges associated with our business. We r espond to, and engage with, government during public consultations on issues that are r elevant to our business. We enable the tr ansparent ﬂow of data that is essential to the functioning of modern economies and the ﬁnancial ecosystem. High-quality data reduces the risk to lenders of extending credit, ensures fair and responsible lending, increases conﬁdence to lend, as well as the ability to assess aordability and meet compliance obligations. This beneﬁts the wider economy by improving access to credit, improving mark et competition, increasing cr edit diversiﬁcation and reducing the cost of cr edit. Shareholders w ant to: understand Experian’s strategic direction, ﬁnancial performance, and the sustainability of the business analyse structural market tr ends generate sustainable investment returns thr ough share price appreciation, dividends or share buybacks understand management and incentive structures ensure they are in vesting in businesses that are committed to environmental pr ogress, societal beneﬁt and which have strong governance. We build r elationships with our shareholders thr ough our investor relations pr ogramme. In our quarterly ﬁnancial updates we inform our shareholders about Experian’s ﬁnancial and strategic pr ogress. We hold face-to-face meetings and run dedicated teach-ins to educate them about our business and ESG commitments. Regular investor surveys pr ovide us with feedback and enable us to take correctiv e action if necessary . We aim to cr eate long-term shareholder value, by investing to grow our position in our chosen markets, while ensuring we meet our wider sustainability commitments. Why Why Why How How How V alue V alue V alue Our shareho lders Our supp liers Gover nments 31 key suppliers in our dedicated SRM 1 > 11 k data contributors in the USA 1. 3 bn consumers and 166m businesses – credit history and repayment r ecords 4 % Organic r evenue growth 2030 carbon neutr al commitment 15 . 0 % Return on capital employed USc 1 0 3 .1 Benchmark EPS 1 Supplier Relationship Management Our strategic focus ar eas to seize new opportunities and help customers achieve their ambitions Acceler ating inno v ation Our strate gy is based on our fundamental purp ose: to create a better tomorrow for consumer s and organisations. It has been a year of challenge, with the COV ID- 1 9 pandemic aec ting bi llions of peo ple around the world. In re sponse, our purp ose has guided our approach, as we have played an es sential role i n helping those a ected. Our employee s have risen to the challenge of providing pra ctical assistance to help consumers, b usi ness es and communities. We have also worked w ith regulators , lawmakers and governments in our key markets to ensure that ﬁnanci al relief reaches , and will contin ue to reach, the pe ople and businesse s that need it most . Even during these times , we have not let u p on strate gic i nvestment. We have invested in new innovations, streng thened our competitive p osition and seized new market oppor tunities . In fact, the p andemic h as accelerated pr eviously existing trends. T he new produc t in vestment s we have made over the last few years have p ositioned us well to take advantage of the se trends, as have the investment s we ha ve made in organisational capacit y and technology infrastr ucture. Combine d, this h as meant we can bring the r igh t produc ts to market quickl y . At the hear t of our strategy ar e the key m arket trends driving lon g-term changes in our customer base. T heir needs and prior ities are continuall y evolving. Our str ategic focus areas deﬁne the prior ity cus tomer sets that we ser ve, the key challenges they are grappling with , and how we can be par t of the solution. We consult customers to bet ter understand the se needs s o that we can develop the best pr opositions to address them . Experian plc Strategic r eport 26 27 Experian plc Annual Report 2021 Strategic report Make credit and lending simpler , faster and safer for consumers and businesses See page 28 Help businesses verify identity and combat fraud See page 32 Help organisations in specialised vertical markets harness data and analytics to make smarter decisions See page 34 Enable businesses to ﬁnd, under stand and connect with audiences See page 36 1 3 4 5 Empower consumers to improve their ﬁnancial lives See page 30 2 Our customers Experian plc Strategic r eport 28 Mar ket trends Custo mer needs When consu mers appl y for credit they ha ve certain needs and expectations. They would li ke the process to be easy and inc reasi ngl y they wa nt to a pply th rough a d igita l device. In o ther wo rds, they seek a seaml ess online experienc e. At the same time l enders need to m ake decis ions rapid ly on who t o lend t o and how m uch. W e sit i n-bet ween. Our da ta assets and advanced ana lytics mean the time ta ke n to make decisio ns is greatly reduce d and cons umers can get res ponses quickly . In this way , fr iction in the whole le nding p rocess is reduced and eve r yone beneﬁts from a bet ter exp erience. What we did this year In EMEA, we have expanded our pr esence through str ategic acquisitions. In June, we completed the acquisition of a majority stake in Arvato Financial Solutions’ Risk Management division, allowing us to r apidly expand our range of risk, fraud and identity management services across Germany , Austria and Switzerland. In Spain, we acquired Axesor , whose experience in business information complements our previously existing consumer information business in the region. This means we ar e now able to oer our clients the only integrated pr oposition for consumer information, business inf ormation and decision analysis in the Spanish market. We ar e at the for efront of open data technology , and have intr oduced new services such as aordability checking tools, personal ﬁnance management and recommendation engines. T o date, we have launched open data categorisation services in eight countries. W e continue to focus on consumer-contributed data and open data to augment our capabilities in both existing and new vertical markets. In Brazil, the introduction of new legislation in 2019, supported by Ser asa Experian, means positive payment histories (recor ds of bills paid) can now be used in cr edit assessment, as well as negative data (missed payments and defaults). W e have launched a r ange of new positive data services, that we believe has the capability to beneﬁt 137m people, 87% of Brazil ’s adult population. T o date, we have 96 banks contributing data on 97m consumers. Based on our success in North America, we have been rolling out our Big Data analytics and insights platform, Ascend, across our global markets. W e are continuing to launch new products on the cloud-based platform, including Ascend Intelligence Services, which harnesses the power of AI and machine learning to support model management, development and monitoring. We initiated the implementation of our plans to improve the performance of the UK and Ireland business, enhancing customer experience, and aiming to r eturn the business to proﬁtable gr owth. This has involved establishing and starting out on the pathway to simplify our technology and application estate, as well as restructuring the organisation to focus on delivering enhanced outcomes for our clients. In addition, we hav e implemented growth initiatives to bring scale to some geogr aphies, with restructuring actions to gain gr eater operational eciency and focus our activity on a smaller number of end markets in EMEA and Asia Paciﬁc. Change s in consumer s’ digital b ehaviour Adv ancement s in automation and techno logy Reduced fric tion in loan acquisition and unde rw riting Ab ilit y to make smar te r lending d ecisions Optimal mana gement of cre dit p or tfo lios Financial ser vices – Cre dit ca rds – Consumer lenders – Mor tga ge len ders – Auto l ender s – Co mmerc ial lende rs and t rade c redi t – Onl ine lend ers Risk of h igh loss f or our cl ient s from poor lending decisions Th e prima r y role of th ese c ompani es is lending Len ding oppor tuni ties are grow ing across digit al channels E xper ian is a lea der in th is spac e Thr ough indust ry -leadin g accurac y of cre dit an d alterna tive da ta Consumer-consente d d ata focus Data lin kage capabilit ies Advanc ed analytic s Market-l eading plat for ms Strong and l ong-s tandi ng relationships with clients Our strategic focus ar eas contin ued Mak e credit and lending simpler , faster and s a fer for consumer s an d bu si nesses 1 Who? Why? How? Posit ive da ta is generat ing new opportunities i n Brazi l. Previous ly lend ers had to w ait un til a loan defa ul ted to ﬁnd out if a cu stomer was a ble t o pay back a l oan. Now with positiv e data t hey can assess a customer’ s capacity to repa y a loan a nd over ti me tr ac k trends th at might ind icate repa yment d istress or vulnerabi lit y to defau lt, and tak e the app ropriat e action. T o help them do this, we hav e been launching new positive data scores, attributes and alerts, such as for estimated income, aordability and on-time payments. We’ve added machine learning into the statistical modelling techniques for the data analysis and scor e construction, as well as new sources of data like utility pa yments. And our data is refr eshed frequently allowing f or a rapid r esponse to changing credit proﬁles. Lenders can incr ease credit thresholds and oer customers better ﬁtting products basedon their cir cumstances. It’s not just large companies that will beneﬁt fr om this but small and medium-sized businesses as well. Having access to this rich base of information and analysis will help pr ovide them with a new vision of their customer base, and help them impr ove r esults at a time when it is essential to seek new business opportunities and rapidly r espond to changes in themarket. So far , 105 million Br azilians have joined the positive data registry and 770 million transactions ha ve been register ed. With positive data we expect to see that23 million people, 14% of the adult population, with thin ﬁles will gain betteraccess to credit, that total credit : GDP will incr ease from 47% to 67%and mor e than US$240bn of new credit will become available in theBr azilian economy . The wealth of new information on customers' payment habits means lenders can gain deeper insights and a greater degr ee of accur acy in their forec asts, increasing trust and leading to wider access to credit for consumers. Rodrigo Sanchez Vice President, Credit Services, Serasa Experian Strategic report T ransforming live s by gen erat i ng new o pp or tunitie s wi th p os iti ve da ta 29 Experian plc Annual Report 2021 F uture plans We will continue to in vest to develop and maintain the superiority of our data, analytics and decisioning products, as well as opening up new opportunities, for example in consumer-consented data. These investments allow us to pr eserve and increase our existing r evenue streams, while also expanding the markets we address. We ar e focused on better aligning our global platforms to make it easier for clients to use our advanced capabilities. We expect str ong growth as or ganisations further embrace analytics and automation, and will bring our capabilities together in incr easingly sophisticated and integr ated propositions to address key business needs. Through scaling our solutions, we c an bring our products to new markets more quickly . New featur es of our global platforms such as Ascend, PowerCurve and Experian One, as well as our open data products, are being r olled out globally to give a wider geographic al reach. We will r emain market leaders for major market shifts, such as adoption of open data globally , positive data in Br azil, and identity services. F or shifts such as positive data, we will continue expand our solutions to serve as wide a market as possible. 14 % of the adult population in Brazil, with thin ﬁles will gain better access to credit Experian plc Strategic r eport 30 Mar ket trends Custo mer needs Our vis ion is t o become consume rs’ ﬁrst choice for m an agi ng their ﬁna nci al lives. Our solu tions can he lp consu mers ga in access to c redit at aorda ble rates a nd to ma nage thei r ﬁna nci al lives. We h ave buil t relationships with 1 1 0 mi llion con sumer s global ly , in cluding o ver 33% o f the adu lt Braz ili an population. What we did this year In November , we launched Experian Boost in the UK, enabling UK consumer s to add on-time payments to their credit ﬁles for the ﬁrst time to instantly impro ve their credit scores. Boost is also stimulating activity for credit comparison services and gener ating referr al fees as consumers often boost their score when looking to apply for cr edit . In the USA, we have incr eased the types of payment Experian Boost takes into account. Consumers can now add payments they make to streaming services such as Netﬂix, Hulu and others to help boost their credit scores. Similarly , in Br azil we have established an ecosystem of services which include an in-app digital wallet and debt payment tool alongside Serasa Score T urbo. The ecosystem also includes a subscription- based oer , Ser asa Premium, that provides enhanced beneﬁts. F uture plans We will continue to build dir ect relationships with consumers and our ambition is to reach millions more. We will also continue to str engthen the propositions we have built to date in cr edit education, identity protection and cr edit comparison. We intend to expand the r ange of services we oer , adding new c apabilities in segments such as Insurance and Health. We will ev aluate the potential to introduce services for consumers in all the markets in which we operate cr edit bureaux. We will continue to in vest in propositions which help those who are curr ently unbanked to gain access to aordable credit and wider ﬁnancial services. Change s in consumer s’ digital b ehaviour Population growth worldwide Prolifer ation of data Changin g regulator y enviro nment Gaining ac cess to cre dit Safe guarding ide ntity Saving mone y Negotiating debt Improving ﬁnancial knowledge Consumers Small busi ness owners Consumer lenders 2 Who? Why? How? Consum ers face signiﬁcant ﬁnancial and emot ional cost s to maintain ﬁnancial wellness , protect themselves and na vigate t he healt hcar e sys tem Urg ency i ncrea ses as l ife ev ents o ccur Incr easin g use of te chnolo gy Direct relation shi ps are critical for consumer-consented data Consumer-consente d d ata Compr ehensive ﬁnancial wellnes s Best-in- class website a nd mobile exper iences Strong par tner ship ecosys tem Acc eler ated mar ketin g to grow us er base Emp ower co nsu me r s to imp rove their ﬁna ncia l li ve s Our strategic focus ar eas contin ued In Braz il 63 mi llion people are incl ude d on t he negative data reg istr y , with an a verage of th ree debts per person. Approxi mat ely 45 m illi on adul t s hav e no bank ac coun t, they ma y be unemp loyed or wo rk in low i ncome roles. They are exc luded from m ain stream cred it, such as for credit card s or car loa ns, because they are so- called ‘thi n ﬁles’ , mea ni ng there is i nsuc ient in formatio n on thei r credit ﬁ les for tradit iona l lende rs to relia bly mak e cre dit deci sions. Many people also have debt obligations which ar e more than ﬁve year s old. These are not included in the negative data r egistry for regulatory reasons. This leads people to think, falsely , that their debts hav e been expunged or forgiven, but in reality these older obligations are still taken into consideration by lender s. A dedicated team at Ser asa Experian spent six months developing the free Scor e T urbo experience, which is designed to help people to get on top of their debt payments, impr ove their credit score and enhance prospects for accessing cr edit. P eople get rewar ded for paying their bills. They can connect to Ser asa Limpa Nome (our online debt resolution marketplace), activate their positive data registr ation, and we oer them the opportunity to ‘T urbo’ their score by making payments towar ds older debt obligations. They can also keep curr ent credit r epayments up to date before they fall ov erdue. The oer was launched in September 2020. So far , people have on aver age received a 22-point incr ease in their score and mor e than 69m points have been distributed over all. This is not all, as people c an improv e their eligibility for more suitable loans. For the unbanked, it helps them to establish a credit history and c an be a path towards accessing mainstream cr edit. W e have a big social r ole to fulﬁl as very often we are the ﬁr st point of contact for the unbanked or people who need help to resolve their cr edit obligations. With Score T urbo we wanted to ﬁnd a new way to educate people, to help them keep their accounts up to date and improv e ﬁnancial access. Carina Herzmann Product Manager , Score T urbo, Serasa Experian Sc an the Q R codes for further examples Seras a Sc ore T u rbo Spe ed up your c redit sco re on the ﬂ y! Limpa Nome Supp or ting Brazil ian consumers to repay their debts 31 Strategic report T ransforming live s by Winner of the 2020 Experian Si Ramo Awar d for Commercial Impact helping Br az i lia ns to r e s olv e t h eir debt s Experian plc Strategic r eport 32 Mar ket trends Custo mer needs Change s in consumer s’ digital b ehaviour Prolifer ation of data Changin g regulator y enviro nment Help with ide ntity veriﬁcation and detection and prevention of fraud Streaml ined authentication of legit imate par tners People and bu si nesses are transacting more on line a nd in the dig ital sp here. F raudsters a re taking advantage o f thi s and so bus inesses are inc reasi ngly aware o f the need to prot ect themselves from fraud. We pro vide ser vices whi ch help organisation s to identif y and authenticate the co un terpar ties th ey engage wi th to en sure tran sactions are legit im ate. W e al so help organ isati ons to d etect and preven t fr audulent act ivi ty. What we did this year In May , we launched Sur e Proﬁle in the USA, aimed at combatting the growth of synthetic identity fraud which is expected to contribute to US$48 billion in annual online payment fraud losses by 2023. This type of fraud occurs when the perpetr ator , instead of stealing an identity , blends information together to create ﬁctitious identities used to obtain and build credit history . Sure Pr oﬁle validates consumer identities and detects proﬁles that have an incr eased risk of synthetic identity fraud. In North America, the unemployment rate has surged as a r esult of COVID-19, which has in turn led to a spike in fr audulent unemployment claims. Experian’s Pr ecise ID solution is helping prevent and detect improper and fr audulent unemployment insurance payments, through our exclusive partnership with the Unemployment Insurance Integrity Center’s centr alised Identity V eriﬁcation capability . F uture plans In our 2020 Global Identity and Fr aud Report, 95% of businesses said they felt conﬁdent they can identify their customers. Y et more than half of consumers don't feel recognised, and 88% say their perception of a business is improved when that business in vests in security . This show s the progr ess that needs to be made in bridging the gap between business and consumer perception of customer veriﬁcation. In FY22, we e xpect to continue our progr ess in helping businesses bridge this gap. We will continue to sc ale the adoption of CrossCor e, our fr aud prevention platform. CrossCor e combines advanced analytics, rich data assets, identity insights and fraud-pr evention capabilities. It enables businesses to connect any new or existing tools and systems in one place. These can be fraud detection applic ations from Experian, our partners, or the client’s own applications. We will continue to add mark et-leading solutions to this platform, so that businesses can adjust their fr aud-prevention str ategies to cope with the evolving threat landsc ape. Financial ser vices Re tail T ravel and leisur e Publ ic sec tor So cial media H ealth – Providers – Payers – Pharm acy Who? Why? How? High p ropo r tion of cr edit c ard and l oan char ge- o s are fr om ident it y frau d Growing regulato r y costs Increasing opportunit y from growi ng use of digital channel s Fragme nted compe titors be ginning to consolidate Lev eraging uniqu e consumer an d commercial data ass ets Advanc ed analytic s and machine lear ning m odel s Mod ern techn ological inf rastr uct ure T okenised identit y E xtensive par tne r ecosys tem Hel p bus i nesses ver if y ide ntit y an d c ombat fr aud 3 Our strategic focus ar eas contin ued The COVID - 1 9 pandem ic ha s driven a rapid s hift from face-to-face to online t ransactions. This h as resul ted in fraudsters escalati ng thei r autom ated ta rgetting of onli ne cha nnels, with fraud attacks such as accoun t tak eover 64 % higher t han t he year before. Account takeover (A T O) fraud is a blend of old and new-style fraud. It occurs when a fr audster gains control over an account that does not belong to them, changes information such as login cr edentials, passwords or personal information, and then makes unauthorised tr ansactions in that account. The rise of A TOs has come about in part due to the incr eased capabilities of bots that run automated tasks, constantly barraging and testing security systems. They r epetitively try to inﬁltrate accounts. Over 40% of online login attempts last year came fr om attackers. And they are proving successful. In 2020, A TOs accounted for 54% of all fraud attack s, up from 34% in 2019. We want to help businesses to r espond swiftly to these threats. That’s why we updated CrossCor e, our integrated digital identity and fr aud risk platform. It c an ﬂexibly scale up and down, handling the large volumes and speeds of the recent upsur ge in online transactions with ease. And to determine that the fraudster , not the customer , is the one logging into an account requir es a layer ed approach, beyond passwor ds and two-factor authentication. Our capabilities in device r ecognition, behaviour al biometrics, machine learning and risk -based authentication can all help businesses r educe their reliance on manual checking, usernames and passwords, and block fr audulent transactions. Businesses can r espond to A TO thr eats quickly and automatically , and at the same time keep giving their customers a seamless online experience, one where legitimate tr ansactions aren’t turned away . Identity risk fr aud has evolved. It is now more automated, more scalable and mor e sophisticated, with fr audsters incr easing both the variety and volume of their attack s. Businesses need to respond just as swiftly with more r obust security and identity checking str ategies, while still ensuring a great customer experience. Eric Haller Executive Vice President and Gener al Manager of Identity and Fr aud, Experian Sc an the Q R codes for further examples Precise ID Evolved identity ver iﬁcation and fraud prevention CrossCore Brings together all the data an d ser vic es you nee d into a single v iew via on e plat for m Anti-Money Laundering (A ML ) and Kn ow Y o ur Cus tomer (K YC) che cks to pr otect a nd improve customer journey Strategic report 33 Upper-right quadr ant on the Juniper Research 2020 ‘Digital Identity’ leader board T ransforming live s by pro t ec ti ng bu s i nesses f r om au tomate d at tacks Experian plc Strategic r eport 34 Mar ket trends Custo mer needs The propositions we develop are often relevan t to a wide ra nge of clien ts and can be adopted ac ross a range of ma rket segme nts. Many of these vertical marke ts are only just starting to reali se the beneﬁts our solut ions can bri ng and are ripe for transfor m ation. We tak e a targeted a pproach t o thi s by focusi ng on cer tain at trac tive ver tical oppor tunitie s. What we did this year We continue to sc ale our oerings in the health sector , r eacting to changing trends within the industry such as the shift towards 'value-based car e' and the demand from consumers for a better patient experience. We ha ve a comprehensive set of pr opositions to help healthcar e providers with r evenue cycle management, and an e xtensive and expanding client base using these solutions. Increased digitisation and expectations of the modern consumer around their healthc are experience have driven gr owth in our scheduling, patient engagement and payment solutions, and we ha ve also pursued opportunities to expand in the identity management space. We started to establish a pr esence in the automotive segment in Brazil thr ough Serasa Auto, our auto loans contr act registration solution. W e are expanding Ser asa Auto’s geographic al reach within Br azil, helping clients comply with vehicle ﬁnancing regulations within their state. F uture plans The health industry is experiencing signiﬁcant change, with COVID-19 having a massive impact on how car e is provided and managed, and also on patient expectations. We see our expertise in patient c are co-ordination, identity , authentic ation, payments, and collections as a signiﬁc ant growth opportunity . Beyond that, we also see consumer opportunities within Health. Across vertic als and regions, we are aiming to complete our transition to a fully cloud-enabled business, br oadening decisioning access through Experian One. We will impr ove our position in key growth verticals. F or example, we will build on our lead in Automotive, utilising Experian solutions in data decisioning and marketing, to help a range of industry participants mak e better decisions. Change s in consumer s’ digital b ehaviour Prolifer ation of data Adv ancement s in automation and techno logy Changin g regulator y enviro nment Reduced comple xity and increase d transpar ency Improved ab ility to leve rag e data and analytics within workﬂows Reduced op erational cost s H ealthcare In surance Automoti ve – Dea lers – Lenders – Manufa cturer s Who? Why? How? Large or g rowing areas where high- cos t decisions cur rently inter sec t wit h lack of t ransp aren cy Opp or tuni ties to b uild new da ta ass et s in many ar eas Utilisi ng Experian customer commercial and vehicle data Advanc ed analytic s Plat forms and ad vanced progr amming interfac e distribution methods Relationship sales forces Help or ganisations in spe ci alise d v er tical mar k ets har ness data and anal y tics to mak e smar ter deci sion s 4 Our strategic focus ar eas contin ued Engagemen t bet ween provider and patient Scheduling of appoint ments Registration and c hecking of identity Estimation of co st s Payme nt options Checking into appoint ment More cont rol and more con venience. That’ s what people wan t from thei r heal thcare experience. Ne arly eig ht i n ten people i n the U SA want t o b e abl e to schedu le the ir own appoi ntme nts, as well as com plete t heir reg istration and pay bi ll s, at an y time o f day o r nig ht. Just like ordering gr oceries or online banking, they want the same level of ﬂexibility and accessibility when managing their healthcar e. Not only does it put the patient in the driver’s seat, but it helps reduce no shows, it’s easier for patients to adhere to c are plans, and has helped minimise face-to-face contact while COVID-19 remains a concern, keeping sta and patients safer . F or health providers it means they c an attr act and retain mor e patients by quickly verifying legitimate patients, r educing fraud and denial rate for eligible patients, as well as pr oviding simple and clear pricing information, helping to increase patient trust and payment collection eciency . Now , as the USA pushes forwar d with its COVID-19 vaccination drive, the challenge for health provider s has turned to administering vaccines as eciently and safely as possible. Online patient scheduling allows providers to: Push booking links directl y to patients, and designate speciﬁc day and time slots for administering vaccines T riage people for vaccinations or testing, and check eligibility using screening questionnair es Automate follow-up appointments for two-dose vaccines Scale up or down their eorts depending on when, or how many vaccines they r eceive. Most importantly , healthcar e workers, and the aged and vulner able, c an be prioritised for vaccination, followed by the r est of the population who can conveniently , comfortably , and safely book their appointments. Online patient scheduling has been a game changer in the USA, not only recently during the height of the pandemic, but also during the vaccine r oll-out. We’r e very proud to ha ve helped book 100,000 vaccine appointments across nine clients since December 2020, with an aver age time from booking until ﬁr st appointment of just 4.7 days. Jennifer Schulz Group Pr esident, Health, Automotive, T argeting and Data Quality , Experian 35 Strategic report T o help improve the patient experience we combined our data, capabilities, and competencies to create an online patient scheduling solution that seamlessly covers: pu t ting patient s i n cont rol T ransforming live s by Experian plc Strategic r eport 36 Mar ket trends In a cro wded mark etplace, busi nesses want to u nders tand t heir custome rs bet te r and com mun icate with them more e ectively . They need to be able t o ident if y aud ience grou ps, then target t hem with releva nt messages and oers – sim ul taneousl y managi ng thei r communication cost s as ee ctively as possibl e. W e provide the i nsig hts they need by combi ning and enrich ing d atasets and helpi ng our clie nts i dentif y custo mer s. What we did this year In November 2020, we completed the acquisition of T apad in North America, to advance our position in digital identity resolution for mark eters. T apad augments our oine identity and marketing data assets in the US market with cross-device data, digital linking and distribution capabilities, to help connect brands to consumer s. The marketing industry was disproportionately impacted by the COVID-19 pandemic, as businesses look ed to manage their discretionary spend. Despite this, our targeting business made good str ategic progr ess. F or example, in the UK and Ireland, we successfully partnered with Infosum to launch a new digital linkage solution. Experian Match provides UK publishers with addressability at sc ale, without r elying on third-party cookies or r equiring a logged-in audience. This means advertisers are able to safely and securely match their ﬁr st-party customer data against publishers’ addressable audiences in a privacy - compliant way , without any per sonal data being shared between companies. F uture plans The explosion of digital activity during FY21 redeﬁned how people shop, manage and spend money , and access various services. Some of that activity has returned oine and will continue to do so as vaccine availability broadens, but much will not. As more transactions and spend occur digitally , we will ensure Experian pr ovides propositions to help clients with customer acquisition, onboarding, fr aud prevention and detection, and with authentication which always complies with privacy requir ements. We will look to expand the solutions we provide and the vertic als we serve by maximising adjacent opportunities, including extending across the ﬁnancial services v alue chain and targeting other vertic als with attractive gr owth prospects. Our pr oduct pipeline continues to grow , allowing us to enable trusted sharing of data for targeted advertising, and utilising our solutions to accurately connect businesses with customers. Change s in consumer s’ digital b ehaviour Population growth worldwide Prolifer ation of data Adv ancement s in automation and techno logy Ability to accuratel y connect busi nesses and c ustom ers Cap acit y to o er products to consumers across channel s Compliance with regulations E n abl e bus i nesses t o ﬁnd, unde rsta nd and connec t with audiences 5 Financial Ser vices Re tail Me dia Automotive Healthcar e Marke ters Adver tising agencies Who? Why? How? Ecient ly acquired cu stomer s are highly valuable Cus tomer a cquisi tion is a p rimar y focus for bus inesses Adv ert ising spend mo ving to digital channels that can take ad vantage of targeted marketing Ide ntit y grap hs (oin e and onl ine) Propr ietary consumer data Segmentation model s (such as Mosaic) Advanc ed analytic s Plat forms simplif ying audience creation, digi tal del iver y an d repo rt ing Par tn er eco sys tem to enab le ident if ying consumer s across channels Custo mer needs Our strategic focus ar eas contin ued Mark eti ng data i sn ’t used just by advertisers. It is useful to any organisation that deli vers ser vic es, helpi ng them to ﬁ nd the people who need support as quickly a s pos sible. With the dramatic rise in CO VID-19 cases in March 2020, people in the UK were asked to stop non-essential contact and tr avel, and to stay at home unless for essential reasons. Many shops and workplaces closed, with subsequent loss of work and income for many families. People vulner able to infection, such as the aged or disabled, were advised to shield at home losing their contact with their local communities. Charities and local ocials needed to quickly prioritise r esources, identify the people who were struggling, and get them help fast. T o do that they needed information on which to act. Our UK and Ir eland marketing team knew that we had the data, analytics and expertise to help. We developed a new tool called Experian Safeguar d which from concept to deployment took just two weeks. We aggr egated and anonymised our ConsumerView database into a dashboard, and included visual mapping tools for accessibility and ease of use. User s could then identify , for example, population groups acr oss the UK that were likely to include those who ar e 71-years plus, single pensioners or low-income households on the poverty line. This free tool was used by mor e than 70 local authorities, NHS Trusts, emergency services and charities. In one example it was used by a charity to identify the best locations for new food bank s where they could r each the highest number of vulnerable people. At a time of great str ess and crisis it has allowed organisations to mor e eectively plan and prioritise their services and allocate their r esources, as well as create communic ation strategies to engage loc al communities, and to estimate future demand for services. Access to data and analytics brings greater insight into pr oblems facing society and this was another example of where data drives good outcomes for people, communities and society as a whole. Sc an the Q R codes for further examples W e believe that data analytics helps make better , more informed decisions. It plays a fundamental role in how societies can r espond to and over come challenges, and drives positive outcomes for everyone. Sarah R obertson Product Dir ector , Experian Mark eting Services, UK and Ir eland help i ng local autho ri ties and v uln er ab le commun itie s 70 + local authorities, NHS T rusts, emergency services and charities used this free r esource T ransforming live s by COVID Outlook & Response Evaluator A 'heat map' of geographic populations across the USA most susceptible to developing severe cases of COVID-19, which would likely result in e xcessive strain on healthcar e resour ces. Mosai c Our con sumer clas siﬁcatio n for consistent cross -channel marketin g 37 Strategic report Experian plc Strategic r eport 38 w Our sustainable business strategy: En vironmental, Social and Governance T r ansforming lives with data Im prov in g ﬁ nan cial healt h f or all T reatin g data w ith resp ec t ENABL ED BY SUPPORTED BY Core produc ts W orking with integr ity S ocial Innovation Inspir ing and supporting our people Comm unity investme nt Pro tec ting the environm ent Sec u rity Acc ura cy Privacy T r ansparenc y THROUGH OUR Co ntri butin g to the U N Sust ainab le Deve lopm ent Go als 1. 4 8 .1 0 9. 3 OUR PURPOSE Creating a b et ter tomorrow Se e pag e 40 Se e pag e 4 7 Se e pag e 43 Se e pag e 4 1 Se e pag e 5 1 Se e pag e 45 Se e pag e 45 Se e pag e 4 1 Se e pag e 53 Se e pag e 46 OUR SUST AINABL E BUSINESS STR A TEGIC PRIORITY We a re usi ng the power o f da ta to transform lives and help bu si nesses grow , by im proving ﬁ nanc ia l heal th for people arou nd the world. Our commi tment t o sustai nable bus iness is stronger t han ev er , and we have rigorous processes i n place to mitig ate enviro nmen tal, social a nd go ve rna nce ( ESG ) ris ks. Our g oals Improving ﬁnancial health for all Reach 1 00m pe opl e throug h Socia l Inno vatio n products by 202 5 ( from 2 0 13 ) Reach 1 00m pe opl e throug h Uni ted for Fin anci al Health b y 20 2 4 Diversit y B y 2 02 4 increase the p ropor tion o f women i n our ex e cutiv e commi t t ee and di rect repor ts to 30%, i n our senior l eaders to 40 %, in ou r mid-level l eaders to 4 2%, and i n our to tal workforce t o 4 7% Environme nt Become carbon neutr al in our own oper ations by 2030 Science-based target: By 2030 reduce Scope 1 and 2 emissions by 50% and Scope 3 by 15% Gradually oset our Scope 1 and 2 emissions over the ﬁve years to 2025 1 1 S ee pa ge 55 f or mor e det ail . 39 Experian plc Annual Report 2021 Strategic report w Our pur pose is to c reate a better t omorrow for con sumers, our c lien ts, our people and c ommu niti es. We are doi ng thi s by unl ocking t he power of d ata to c reat e oppor tun ities forpeople and bu sinesses. Our sust ainable business strategy alig ns with and s uppor ts our pu rpose and busi ness model, helping us add v alue f or our stak eholde rs (see page 2 4). It se ts out our approach t o our mo st mat erial ESG opportunities and ris ks. 35 million Our United for Financial Health campaign has reached 35 million vulner able people in communities hit hardest by COVID-19 thr ough ﬁnancial education partnerships with 11 NGOs in the USA, the UK and Ir eland and Br azil. S ecur it yFir st We ha ve maintained our strict information security controls and SecurityFirst cultur e as we adapted to new ways of working during thepandemic and responded to emer ging cyber threats. 61 million Since 2013, our Social Innov ation products hav e reached 61 million people – putting us on tr ack to meet our goal of 100 million by 2025 – and generated US$103m in r evenue. This year , PowerScore alone enabled 1.3 million people inIndonesia to apply for credit for the ﬁr st time. Di v ersit y , equit y and inclusion We ha ve refr eshed our strategy on diver sity , equity and inclusion (DEI) and set public targets to improve gender diver sity . In 2021, we are publishing a global DEI report for the ﬁrst time. 4 .5 million 6.7 million people in the USA have connected toExperian Boost since March 2019, enabling 4.5 million people to instantly improve their credit scor e by adding on-time payments to their proﬁles. In the UK we launched Experian Boost in November 2020 and have 370,000 active members. Roa dma p to car bon neutr al We cut our c arbon footprint by 58% this year and set a science-based target as part of our ambition to become carbon neutr al in our ownoperations by 2030. We bec ame a public supporter of the T ask F orce on Climate-Related Financial Disclosure and achieved an ‘A -‘ leadership r ating from the CDP . Highlig hts in F Y2 1 Experian plc Strategic r eport 40 Our sustainable business strategy: Envir onment, Social and Governance contin ued Our priorities Improving ﬁnancial health is how we c an make the biggest dierence to society by r aising standards of living, tackling inequalities and contributing to the United Nations Sustainable Development Goals (SDGs). The economic fallout of COVID-19 has further underlined this as a priority , exacerbating underlying ﬁnancial issues for already mar ginalised groups in society . We use our cor e and Social Innovation products, harness the passion and expertise of our people, and donate some of our pr oﬁts to improve ﬁnancial health for people ar ound the world. Through our data and analytics, we give lenders the information they need to oer fair er access to credit that enables people to get the essentials that can tr ansform their lives – from homes and healthcar e, to educ ation and entrepr eneurship. W e go further by increasing access to ﬁnancial services, and empowering people to understand and manage their ﬁnances and protect themselves fr om fr aud. Improving ﬁnancial health also supports the long-term success of our business by strengthening our r eputation and stakeholder relationships, driving innovation, generating new revenue str eams, and cr eating potential new customers for us and our clients by increasing ﬁnancial inclusion. How we work is as important as what we do. We ar e entrusted with data on 1.3 billion people and 166 million businesses worldwide. T reating that data with respect is essential to maintain trust. Keeping it secur e is our ﬁrst priority , and failure to do so is our biggest business and ESG risk (see page 75). W e must also protect the privacy of the data we hold, keep the information we have on individuals and businesses as up-to-date and accurate as possible, and be tr ansparent about the data we collect and how we use it. Our strategy is built on a str ong culture of corporate r esponsibility . W e aim to inspire and support our people by embracing and developing diverse talent, and creating an inclusive working environment. We ar e committed to working with integrity , always, and we strive to do our part to tackle climate change and protect the envir onment . This responsible cultur e also helps us recruit and retain people with the expertise and experience we need to grow our business and meet our sustainable business goals. Governanc e The Chief Financial Ocer acts as executive sponsor of our over all ESG progr amme, which focuses on ESG opportunities and risks and the Company Secretary ov ersees the Group's Corporate R esponsibility progr amme. They both sit on the Executive Risk Management Committee that oversees how we manage risks globally , including ESG risks (see page 72). Our innovation cultur e puts consumer and client needs ﬁrst, and we ha ve strict processes to ensure we build critic al ESG considerations – such as data security , privacy and accur acy – into our products and services. W e extend our high standards to suppliers thr ough our third-party risk management fr amework. A central team and a network of r egional corporate r esponsibility leads, specialists and steering groups acr oss the business manage our Social Innovation, community investment, health and safety , and envir onmental progr ammes and impact . The impact framework for our sustainable business progr amme helps us achieve demonstrable ﬁnancial health improvements thr ough our people, pr oducts and proﬁt. We tr ack metrics related to our charitable and voluntary contributions in each region monthly , in line with the Business F or Societal Impact framework. The Board receives r egular reports on our performance, and we publish global data every year in our Annual Report and Sustainable Business Report. We are increasingly measuring and r eporting on the impact of individual products and pr ogrammes, as well as their combined reach. This year , we have started using the Sustainability Accounting Standards Boar d (SASB) r eporting framework to r eport on material issues (see our Sustainable Business Report). Experian has been a member of the FTSE4Good ESG index since 2012. Experian is featured in the S&P Global Sustainability Y earbook 2021 as a leader on ESG – scoring in the top 15% of the professional services industry . Across our k ey markets, we see signiﬁcant opportunities to tr ansform lives by tackling ﬁnancial exclusion and improving access to cr edit. More than a billion people in Asia P aciﬁc lack access to formal ﬁnancial services, 45 million inthe USA have thin or no cr edit proﬁles, 45 million in Brazil do not use bank accounts and over ﬁve million in the UK have no cr edit history . We focus on f our key aspects of ﬁnancial health: increasing access to ﬁnancial services, impro ving ﬁnancial literacy and conﬁdence, helping people manage their ﬁnancial lives, and pr eventing fraud and identity theft. We do this thr ough our core business, Social Innov ation products and community investment progr ammes. Improving ﬁnancial health also supports our business. Both cor e and Social Innovation products that impr ove ﬁnancial health are alr eady generating signiﬁc ant revenue for our business. Enabling more people to access ﬁnancial services expands our potential consumer base. Employ ees who volunteer their time and expertise to support our ﬁnancial education and community progr ammes also bring new ideas and experience back to the business. Pro motin g ﬁnan cial health for all Improving ﬁnancial health for all Core pro ducts Core produc ts In the last two years, more than 4.5 million people in the USA have used Experian Boost to instantly improve their cr edit scores by adding positive data from on-time payments to their pr oﬁles. F ollowing its launch in November 2020, we have 370,000 active Experian Boost members in the UK (see page 30). In Br azil, our new Serasa ScoreT urbo encour aged more than 6 million consumers to renegotiate 9 million debt agreements since its launch in September 2020 (see page 31). R egulations on positive data have opened up the potential to reach millions mor e across the country (see page 29). Around the world, 110 million consumers now use our free platforms to access pr oducts and services that can help them understand and manage their credit pr oﬁles. Our consumer services also help individuals spot potentially fraudulent tr ansactions in their credit proﬁles, and we oer a range of solutions to help lenders and other clients prevent fr aud. This year , our cor e fraud and identity theft products are estimated to have pr evented at least US$10bn in fraud for our clients, and across the Group fr aud and identity products generated 10% of our business revenue. 41 Experian plc Annual Report 2021 Strategic report We’ve identiﬁed thr ee United Nations SDGs – and their speciﬁc targets – wher e we can make the biggest contribution through our str ategic focus on improving ﬁnancial health for all.These three tar gets are all related to impr oving access to credit and ﬁnancial services. Through our Social Innov ation progr amme, we invest in developing new products that ar e speciﬁcally designed to oer additional societal beneﬁts as well as creating r evenue for our business. Our Social Innov ation products hav e reached 61 million people in the last eight year s – including 28 million this year – and we’re targeting 100 million by 2025. Since 2013, they have gener ated US$103m in revenue fr om a total investment of over US$8m. Well -established products such as our Limpa Nome debt recovery portal in Br azil and Prove ID-Link identity authentication in India have contributed to the signiﬁcant expansion in r each this year . Sever al newly launched products have also achieved a big r each in their ﬁrst year . PowerScore has given 180 million people in Indonesia a credit pr oﬁle for the ﬁrst time by using data about their mobile phone use and more than 1.3 million applic ations for credit products have alr eady been made as a result. Our Social Determinants of Healthcar e product has appended the recor ds of 7.6 million people in the USA to connect them to preventative healthcar e progr ammes to help them avoid major medical pr oblems and bills in future. In Brazil, almost 500,000 consumers have register ed for our T rilha Financeira (ﬁnancial trail) online tr aining modules to learn how to better manage their ﬁnances. Improving ﬁnancial health for all Core pro ducts So cial In novatio n Communit y inv estment Social Innovation Communit y in vestment The COVID-19 pandemic has further accentuated inequalities and we have stepped up to help hard-hit communities by launching our United for Financial Health progr amme, which has reached 35 million people in less than a year (see page 42). This year , our total contributions r eached US$12m. Employ ees volunteered 21,000 hours of their time (in and outside working hours) to help out, despite COVID-19 r estrictions limiting face-to-face opportunities. Loc al initiatives included support for communities and ﬁnancial education pr ogrammes to help people thr ough the pandemic. We also r an a virtual campaign to #Map1Million that saw employees volunteer mor e than 2,280 hours to map previously unmapped ar eas of the world that are home to an estimated 923,000 people. The aim is to support Humanitarian OpenStreetMap T eam – an international team dedicated to humanitarian action and community development through open mapping – in its ambition to map areas home to one billion people at risk of disaster orexperiencing poverty . Inclusion on the mapcan also be a critical step towar ds ﬁnancial inclusion. Innovation and advoc acy This year , we channelled inno vation for ﬁnancial health – including COVID-19 recov ery eorts – through our DataLabs, our annual F uture of Information Conference, our Creating a Better T omorrow A wards and our ﬁr st-ever global hackathon. We invited external ideas for overcoming ﬁnancial issues arising fr om COVID-19 by sponsoring the Experian Financial Health prize as part of the US Massachusetts Institute of T echnology’s Solve pr ogramme. We also advoc ate for ﬁnancial health more broadly . This year , we provided expert input to the W orld Bank’s guidelines for lenders r elating to the reporting of consumer payment data during the extended COVID-19 emergency period. P ayment holidays and forbear ances negotiated between lenders and consumers who suered har dships because of COVID-19 were r eported and reﬂected in cr edit reports to avoid adverse eects on cr edit scores as a result. W e also explored barriers to small businesses accessing credit, as a member of the International Finance Corporation’s SME Finance F orum, and sponsor ed the F orum’s annual global conference. Our Identities of the W orld campaign continues to raise aw areness of the impact of ﬁnancial exclusion through powerful per sonal stories. It has reached over 36 million people ov er the last three year s and this year highlighted challenges faced by microbusinesses in Peru. 18 0 million PowerScore has given 180 million people in Indonesia a credit pr oﬁle for the ﬁrst time by lever aging data from their mobile phone use. > 2,2 80 hours to help our NGO partner's Missing Maps project put previously unmapped ar eas of the world on the map. 1. 4 8 .1 0 9. 3 42 Our sustainable business strategy and Governance continued COVID - 1 9 presents a s erious threat not j ust to phys ical health, but to ﬁn ancial hea lth for million s of people around the world. Our United for Financ ial Healt h programme is using ﬁnanci al education to empow er vulnerable communities th at hav e been hit hard by COVID - 1 9 and kickstar t their road to recov er y . We teamed up with 11 NGOs to r each 35 million people in less than a year – smashing our ﬁrst- year target of 15 million. We ar e providing ﬁnancial education r esources, funding, pr oducts and volunteers to help our partners reach the communities they have trusted r elationships with, in ways that are most meaningful and helpful to them. The partnerships this year focused on our thr ee primary consumer markets – the USA, the UK and Ir eland and Brazil. Many support women, young people and minorities to help tackle inequalities that have been exposed and deepened by COVID-19. In the USA, we kicked o the United f or Financial Health progr amme with Operation HOPE, reaching over 4.5 million people from ethnic minority groups with support to r aise their credit scores from surviv al to thriving. We’r e also working with the National Association for the Advancement of Colored People (NAA CP) to help black American families struggling to keep up with mortgage payments, with Black Girl Ventur es to support black and brown women entr epreneur s, with SaverLif e to encourage people fr om low-income backgr ounds to make a habit of saving, and with 211 to tackle stress among low-income and diver se communities. In the UK, we supported National Numer acy’s Number Conﬁdence Week, and we partnered on the launch of the National Liter acy Trust’s Words that Count campaign, reaching almost 3.5 million people with the aim of tackling the link between poor reading skills and low ﬁnancial competence. We’r e also partnering with The Mix to reach under -25s through digital channels, with the T russell T rust to oer access to ﬁnancial education through their network of food banks, and with The Big Issue to pr ovide guidance through their magazine, online public ations and e-wallet for vendors. Some of our partners have also used our new 'Living on 4.27' Y ouT ube channel to reach more young adults. In Brazil, we’re working with Sebrae to help small businesses r ecover from the economic shock of COVID-19 through an online ﬁnancial educ ation platform and mentoring from Ser asa Experian volunteers. Our United for Financial Health partnerships are enabling us to r each consumers who don’t have an existing r elationship with Experian, pr oviding a model we can scale up to help mor e people and providing insights for our business to help us create wider social beneﬁts. Now , we are going further with a tar get to reach 100 million people by2024. Armed with opportunity and ﬁnancial liter acy , we believe that Experian’s commitment to unlocking the power of data to create opportunity means more people will be set up not just to survive, but to thrive in the months and years to come. Their willingness to lean in and support individuals and families through our work in a time of global crisis demonstr ates their sincere commitment to community uplift and outreach. John Hope Bryant Operation HOPE F ounder , Chairman, and CEO Uni te d f or F i nancial H ea lth 11 We teamed up with 11 NGOs to reach 35 million people in less than a year Scan me to ﬁnd out how this pilot scheme is helping empower and protect vulnerable consumers T ransforming live s throu gh 43 Experian plc Annual Report 2021 Strategic report We have a def ence -in- dep th appro ach to prot ectin g our cri tical dat a asse ts, w hich prov ides m ultiple lay ers of co ntrol and prote ction. Perimeter scanning Sc anning the p erim eter for op en acc ess and s canning ap plica tions fo r regul ator y complia nce Firewall Blo cks unaut horis ed ac cess w hile permit ting outwar d commu nication Intrusion Preven tion Sy stem (IPS) E xamines n etw ork tr ac ﬂow s to detec t and preven t vulnerabi lity exploitation Web Application Firewall (W AF) Filter s, mon itors , and blo cks H T TP tra c to and fr om web app licat ions Realtime Application Self Protection (RA SP) Dete ct s and blo cks co mputer at ta cks by taking advantage o f in formatio n from insid e the runn ing sof t ware Ser ver protection Antivi r us, host secu rity , continuous repor ting Data is the lifeblood of our business. So ensuring we collect, stor e andmanage data safely and appropriately is fundamental to our ongoing success. It’s important our clients and customers know we take our responsibilities very seriously when it comes to managing data securely , ensuring privacy measur es are managed eectively , the data we hold is accur ate and we are open and tr ansparent about the data we hold and the way it is processed. T r eating data with r espec t We hold v ast amounts of data on people and businesses. The loss or inappropriate use of data and systems could result in material loss of business, substantial legal liability , regulatory enforcement actions and signiﬁc ant harm to our reputation. Our approach We continually enhance our security infrastructur e, practices and cultur e across the business through our SecurityFirst pr ogramme. We in vest heavily in cyber security and have specialist teams, state-of-the-art technology and rigorous due diligence pr ocedures to deal with potential threats. Our security approach has thr ee tiers: applying tools and processes to pr event threats fr om entering our environment; detecting if a thr eat enters our envir onment; and mitigating any threats by minimising the potential for information to be extr acted from our environment. We ha ve controls in place to check for compliance and constantly scan for potential threats, with sever al layers of pr otection for our data assets (see diagram below). Our perimeter deﬂects tens of thousands of attempts every d a y. Our Global Security Operations Centr e works around the clock to identify suspicious or malicious activity , with teams in Malaysia, the UK and the USA, as well as automated tools and AI. If they identify a thr eat , our incident response team steps in to eliminate it with support from in-house for ensic data specialists and external experts if requir ed. We gather intelligence to help our security teams stay ahead of evolving cyber threats. This year , we expanded our inter action with law enforcement authorities and others in our industry to help give each other early warnings of high-potential cyber security threats. W e also share our knowledge to help other businesses and consumers keep their data safe. Our annual Data Breach Industry F orecast for 2021 highlighted areas that have become increasingly vulner able to cyber attack in the COVID-19 er a. Pr edicted threats include vaccination misinformation and disruption, hackers holding home devices for r ansom, and exploitation of ‘track and tr ace’ apps to gain access to personal user information. This year , CO VID-19 led to almost our entire workforce moving to homeworking and we took steps to provide employ ees with secure r emote connections to our systems. Most data breaches involv e some human interaction, often something as simple as clicking a link in an email. Our email and web br owsing contr ols protect against this kind of malwar e, and our security training also encour ages people to think car efully about what they are clicking on. Our Development, Security and Oper ations (DevSecOps) teams work together to build security considerations into our pr oducts throughout their lifecycle, from start to ﬁnish. We use a r ange of processes, including manual penetration testing, to discover , detect and remediate any potential security risk s at every stage of product development – fr om concept to coding, build, quality assurance and production. We conduct r egular risk assessments and vulnerability check s, and our oper ations are subject to external cyber security audits every year . Simulated ex ercises and a global data breach plan pr epare our cyber security teams and senior leaders to respond r apidly in the event of a breach. Protecting our perimeter Se curit y Accur ac y Privac y T ransparenc y Secur ity Sa feg uardin g da ta Experian plc Strategic r eport 44 Our sustainable business strategy: Envir onment, Social and Governance contin ued Security governance The Chief Information Security Ocer has over all responsibility for Experian’s global security strategy and the Global Security Oce (GSO) sets relevant policies and standar ds. The Security and Continuity Steering Committee – which includes the Chief Executive Ocer , Chief Financial Ocer , Chief Oper ating Ocer and Chief Information Ocer – oversees our approach to keeping data secur e and protecting consumer information. It r eviews key metrics on security tools, compliance and tr aining completion rates every month. The Audit Committee also receives pr ogress r eports at each of its meetings. We ha ve a comprehensive Global Security Policy and controls based on the internationally recognised ISO 27001 standar d. Our r obust information security progr amme builds on industry-r ecognised procedur es, including the US National Institute of Standards and T echnology (NIST) fr amework. We seek and receive thir d-party assurance thr ough ISO 27001 certiﬁcations of key business ar eas and systems, as well as other recognised external accreditations of our security pr ogrammes. For example, we hold a Cyber Essentials Certiﬁcation and perform risk assessments against our critical and external-facing applications annually . Security , Audit and Risk teams work together to continually improve our assur ance capabilities and test the eectiveness of our controls. Our Three Lines of Defence model for risk management (see page 73) includes review by Global Internal Audit and oversight fr om the Board. Any potential policy br eaches are thoroughly investigated and we tak e disciplinary action where appr opriate. The GSO conducts due diligence to identify anypotential risks befor e an acquisition, followed by an in-depth post-acquisition security assessment that is reviewed by GlobalInternal Audit. When it is necessary to provide thir d parties with access to our data and systems, the GSO ensures we pr ovide access in line with our information security requir ements. W e extend stringent standards on information security to our suppliers and partners thr ough the terms of our contracts. All third parties are risk assessed. Of our nearly 13,000 active thir d parties, 1,674 hav e been identiﬁed as signiﬁcant or high risk and all of these have undergone more in-depth assur ance by the GSO. Security requir ements are tier ed based on this risk assessment, and c an include increased controls for higher -risk third parties. We monitor compliance through our thir d-party risk management framework and thir d parties identiﬁed as signiﬁcant or high risk ar e added to the GSO's continuous monitoring progr amme which alerts us to any material changes to trigger follow-up action if needed. Our information security culture At Experian, inf ormation security is everyone’s responsibility . W e set out clear requir ements for employees and business units in our Security Risk Management and Governance Policy . W e invest signiﬁcant time and r esources in tr aining and awareness on information security thr ough our SecurityFirst progr amme. Our strong information security cultur e starts from the top of the business. Senior leaders ar e highly engaged and continually reinfor ce the message that security is the personal responsibility of everyone working with us. Wherever we oper ate, we are committed to ﬁve core Global Information Values: 1. Balance 2. Accur acy 3. Security 4. Integrity 5. Communication 25 0 + training courses ar e available for people acr oss the business to ﬁnd out more about keeping information safe. Scan me to ﬁnd out more about Experian’s commitment to its Global Information V alues. Our Global Information V alues All our employees and any contr actors who have access to our systems must complete mandatory annual training on information security and data protection. W e track training completion rates weekly and pr ovide a monthly dashboard to the Security and Continuity Steering Committee. More than 250 tr aining courses are available for people across the business to ﬁnd out mor e about keeping information safe acr oss various web, mobile and desktop platforms, applications and softwar e. W e provide additional in-depth training for people working in higher-risk r oles, such as pr oduct and software development. We continually r efresh our training to stay up todate with evolving risks and cir cumstances. This year , we focused on risk s associated with working from home and made sur e employees understood how to secure their home network, for example by using ﬁltering software and strong passwor ds. We adapted our regular awareness c ampaigns to continue providing employees with frequent updates on important topics, such as email pr otection and phishing. 45 Experian plc Annual Report 2021 Strategic report Accur acy rate for cr edit reports deliver ed in North America Data privacy is becoming an increasingl y hot topic as people are living mor e of their lives online, a tr end that has been further accelerated by CO VID-19 lockdowns and restrictions this year . Our Group Operating Committee and senior leaders receive r egular brieﬁngs to keep them apprised of privacy developments around the world. We pr ovide services based on information about millions of individuals and businesses. As a steward of the data we collect and use, we have a responsibility not only to ensur e the security of that data, but to maintain the priv acy of consumers through appr opriate and responsible use. W e believe use of data must beneﬁt both businesses and individuals, while meeting consumer expectations related to priv acy . Privac y Protecting d ata Data accuracy is mission critic al for us. Because when a credit r eport is inaccurate, and someone is denied credit or pays a higher price for credit, then it can have a huge impact on their lives. In 2016 our data accuracy was at 98.3%. That sounds high but we knew we had to do better , so we invested in a pr ogramme to ﬁnd where material and consequential errors ar ose and took action to ﬁx them. We ha ve now achieved 99.9% accuracy f or our US consumer bureau, an impressive, industry-setting standard. Y et we’re not done. W e are innovating to continuously impr ove our data integrity and focus on targeted changes that drive even better accur acy for consumers. Donna Smith , Chief Data Ocer , Consumer Information Services, North Americ a 95 % 96 % 97 % 98 % 99 % 100 % Ac cu rac y rat e fo r c r ed it re port s de liv er e d i n Nort h Am er ic a Dec 1 7 Dec 1 8 De c 1 9 D ec 20 J an 16 98.3 % 99.0% 99 .6 % 99 .9 % 99. 9% 99. 9% De c 1 6 Accuracy Impro ving d ata Accurate cr edit reports enable lenders to give people fairer access to cr edit and essential services to improve their lives (see pages 28 and 30). An y inaccuracies in cr edit reports – and the data they are built on – c an cause problems for consumers, and potentially deny them fair access to credit and services. We under stand how important this issue is for consumers, and place accuracy at the heart of our Global Information V alues, which guide our approach wher ever we operate. We constantly strive to improve the accur acy of our data in a competitive market to ensure our clients c an always r ely on it to make the most appr opriate decisions. We ha ve strict processes to ensur e data accuracy – all the way thr ough from designing a new data supply and sourcing accur ate data in the ﬁrst place to monitoring and improving accuracy ov er time, and r esolving any inaccuracies or queried information. Our focus is on timeliness, accur acy and completeness of the data we hold, and the r eports we pro vide to our clients. Sourcing accur ate data All our data comes from r eputable sources and our quality control pr ocedures help us identify and weed out inaccurate or out -of-date information before we add it to our databases. We work with data pr oviders to review and continuously improve the quality of the information we receive. T o do this, we regularly review and r eport back on quality to our data providers, and we oer a comprehensive suite of software and analytics tools to help them check data before they submit it to us. We monitor how data pr oviders deal with queries about data and how they remediate them to improve accur acy . If data pr oviders are unwilling to implement impro vements to meet our standards, we will no longer source data from them. Monitoring and improving data accuracy Once we have acquired data, we frequently update and periodically audit the information in our databases to ensure it is as curr ent as possible. W e also apply further quality assurance techniques, including data-matching algorithms, befor e providing data to our clients. This ensures we pr ovide clients with information that repr esents consumers and businesses as accurately and fairly as possible. In North America, the team that manages the accuracy of data fr om around 12,000 providers makes it a priority to r apidly resolve an y conﬂicts or errors that ar e likely to have a material impact on a consumer’s credit score. Every month, we receive around 32,000 submissions from data pr oviders, and update around 1.4 billion r ecords – 98% within 24 hours. Through continuous impr ovement eorts, we hav e raised the accur acy rates of credit r eports delivered to 99.9% in r ecent years (see chart). In the UK and Ireland, we have added over 20 million new recor ds in the last year alone, constantly reviewing the market and working with new lenders and sectors to ensur e their customers are r epresented appropriately within the bureau. Our UK and Ireland Data Oce leads our eorts to achieve world-class data governance through a str ong focus on data quality , acquisition, transpar ency and privacy . Empowering consumers to correct their data Our platforms enable us to continually monitor and measure data accur acy . W e also have processes for consumers to r eview their own data, r aise a query and have corrections made if needed. Our dispute centre in the USA and our website in the UK make it easy for people to r aise a query about credit information and get it corrected quickly . Many of our products also empower consumers and businesses to protect their data and check for any inaccur acies in their ﬁnancial proﬁles. In Br azil, we have seen a substantial increase in consumer r equests for corrections to their data since new r egulations enabled the inclusion of positive data in credit reports. W e pass on these requests to the data provider to ev aluate, r esolve and supply corrected data wher e errors ar e conﬁrmed. Experian plc Strategic r eport 46 Our sustainable business strategy: Envir onment, Social and Governance contin ued Our privacy policies vary in each country or region to comply with loc al regulatory requir ements. Underlying these policies is our commitment to provide consumers with notice, choice and education about the use of personal information. Educ ated consumers ar e better equipped to be eective, successful participants in a world that increasingly r elies on the exchange of information to deliver products and services eciently . Lenders need access to accur ate information about people’s ﬁnancial proﬁles fr om Experian or other credit bur eaux. Such inf ormation is integral to an ecient and competitive cr edit ecosystem which pro vides innovative pr oducts that enable consumers to get the most out of their data, contributes to economic gr owth and supports a stable consumer banking system. Our Marketing Services business also gathers, analyses, combines and processes data to help organisations better understand consumer s so they can oer them r elevant products and services, and communic ate more eectively and at the right time. We ev aluate every product and service to ensur e we strike the right balance between consumers’ privacy expectations and the economic beneﬁt to both consumers and clients. This commitment to balance is one of our Global Information V alues that deﬁne how data must be secured, managed and used. Our compr ehensive data protection progr amme details the steps we take to mitigate data protection risk s, and what we expect fr om our employees. We ar e committed to obtaining, processing and using data compliantly and responsibly . W e only ever share data with authorised and trusted organisations. When we do so, we follow strict guidelines and comply with all relev ant laws. Regulations on data privacy – the way data is collected and used, and how consent is gained from consumers – ar e tightening around the world. W e respond to government consultations and engage with regulators as priv acy regulations and guidance evolve. Data oers huge potential to support jobs and prosperity . We need a r egulatory framework that nurtures and supports use of data to encourage gr owth, while protecting consumers’ priv acy . Many regional and national r egulations on data privacy share common principles, and we advocate for inter operability to support global commerce. W e have updated our data processes to ensur e compliance with regulations, such as the EU Gener al Data Protection Regulation (GDPR) in Eur ope, the California Consumer Privacy Act (CCP A) in the USA and the Br azil General Data Pr otection Law (L GPD). Our new-look credit r eports in the USA T ransparency Maki ng d ata accessibl e We strive to be tr ansparent about the information we collect from consumers and thir d parties, and how that data is used and shared. In the UK, the priv acy section of our website provides priv acy policies for dierent parts of the business, and our Mark eting Services Consumer Information Portal (MSCIP) explains data rights and sets out the various ways we use personal and anonymised data. The content on these websites is designed to be clear and easy for non-experts, and the MSCIP includes a series of engaging videos on topics such as how we obtain data and how people can beneﬁt from sharing their data. Individuals can use the MSCIP to ﬁnd out if they are on our marketing ﬁle and under stand what data we hold about them, wher e this data comes from and how it is used. It includes a prominent featur e enabling people to opt out of targeted marketing if they choose. T o add transpar ency around the mark eting proﬁles we build, the MSCIP allows consumers to view our Mosaic classiﬁcation for any v alid UK postcode. Through this featur e, consumers can get a ﬂavour of how mark eters may view them, or people lik e them, when using our Mosaic segmentation to improve the r elevance of their marketing messages. The results use simple icons to show key attributes such as property , transport, lifestyle and holidays in a way that’s easy to understand at a glance. In Brazil, our privacy terms page has been developed to be more user -friendly , by tr anslating the consumer contract into simple and accessible language and layout befor e the user logs in. W e also provide consumers with il lustrations of what their positive data means, based on their cr edit car d information, with plans to extend to other ﬁnancial products in the year ahead. The aim is to give our customers more compr ehensible data, to help them understand how that impacts their ﬁnancial health as a whole. In the USA, we set out our priv acy policies for speciﬁc products and services on the privacy section of our website. Consumer s can access the information that Experian holds on them by signing up for a free or paid membership thr ough the Reports and Scores section of our website. They will then be presented with a r eport showing the data Experian holds on them and how to dispute this information online if necessary . Californian r esidents can also manage their personal data permissions through the CP3A portal. Our newly designed credit r eports in North America include a new Cr edit Report Insights section that features infogr aphics, colour- coding and easy-to-interpr et explanations of the factors that may be helping or hurting a consumer’s credit status and score. We also work with ﬁnancial institutions to enhance transpar ency with consumers. In the UK, when a consumer applies for cr edit, the lender will direct them to an industry standar d information notice which presents clear and consistent information explaining how credit refer ence agencies use and share per sonal information. In the US A, ﬁnancial institutions provide adver se action notices when an applicant is denied cr edit or employment based on information included on their consumer credit r eport. This notice includes a brief description of the data used for the decision and a contact for the credit r eference agencies that provided the data. 47 Experian plc Annual Report 2021 Strategic report At Experian, we work to create a better tomorrow f or consumers, for businesses, and for our communities. This ambition underpins our plans for our people – to ensure we ha ve the best people, working in a high-performing and inclusive envir onment where they feel they can do their best work in support of our vision. Last year , we set out our people priorities, focusing on: hiring and developing world-class people in ‘game-changer’ roles; ensuring a supportive, ﬂexible and inclusive environment that attr acts world-class talent; establishing a high-performance mindset throughout the or ganisation; and creating frictionless employee experiences. As the COVID-19 pandemic emerged at the beginning of 2020, our priorities needed to shift quickly to supporting our people where and when they needed it most. Our Boar d and leadership team took a 'people ﬁrst' approach when making pandemic-related decisions. This philosophy has remained in place thr oughout the year as we have sought to look after our people, listen to their changing needs, and continue to build and celebrate our diver se and inclusive culture. Looking after our people Throughout the pandemic we have incr eased our focus on the health and well-being of our teams across the world. W e quickly implemented regular pulse survey s so we could respond r apidly and ensure the right support was available. W e emphasised mental health, reﬂecting the challenges people faced while working remotely . A response to the statement ‘I am feeling physic ally and mentally well’ was 75% favour able on aver age across ﬁve pulse surveys we r an during the year . We put in place a range of initiatives to support our teams, for example #ReachOut, which gave all employees access to resour ces to support their physic al and mental health whenever they needed it. We also developed pr ogrammes to help employees adapt to working from home. For example, in Asia P aciﬁc, Thriving Remotely provided r esources such as e-booklets, podcasts, webinars, senior leadership vlogs, playlists and infogr aphics, alongside other activities to communicate with colleagues. W e ran mindfulness and r esilience programmes for employees, which were r eceived well, with Asia Paciﬁc r eceiving a 95% Net Promoter Scor e (NPS) - the percentage of those who would Inspi ring and supporting our people recommend the pr ogramme to a colleague. We introduced or impr oved Employee Assistance Progr ammes in all regions. In the UK and Ireland, and North America, we extended the time people could take for caring responsibilities, and in EMEA we refr eshed the holiday leave policy to help employees cope with the additional demands placed upon them. We placed additional importance on the ability to collaborate r emotely . Connect 4, for example, is an initiative to connect groups of four colleagues randomly , to replic ate spontaneous ‘water-cooler’ conversations and to gr ow employee networks. Our people also demonstrated their c apacity for creating new connections independently , an example being our Home-Aloners gr oup – employees who live on their own coming together to create a community of support, swapping stories, pictur es, hints and tips. Our strong cultur e has really br ought out the best in our people, and we ar e encour aged to say we have seen pride in Experian, and employee advocacy , increase. In our pulse surveys, responses to ‘I am pr oud to work for Experian’ saw a 5% increase since our 2019 Annual People Survey and ‘I would recommend Experian to family or friends as a place to work’ increased by 3% over the same period. The steps taken to support our people, both practic ally and personally , ha ve helped them adapt to new ways of working, with the question ‘I am able to be productive in my curr ent work set up’ scoring well across all pulse survey s – aver aging 88% positive across the ﬁve survey s. Line managers have also played a critic al role, and we are pr oud employees have r ecognised this, av eraging 85% fav ourable r esponse to the statement ‘I am receiving the right level of support from my manager at this time’ . T o further the two-way conversation with our employees, and to strengthen the connection between our people and leaders while working virtually , we acceler ated the launch of Horizon, our leading-edge employee communications platform. This allows users to r eceive important updates in one place and access it at any time, from anywher e, as well as curate their own content by subscribing to a series of optional categories. They can also publish appr oved content directly on social media. This has been a resounding success, with 97% of our people register ed on the platform, over 900,000 post views and 20,000 comments from employ ees. Throughout FY22, we will continue to develop the platform, to encour age even greater employee connection and engagement. The Experian W ay represents our values, and the behaviours we expect from all our employees in their everyday activities. This year , our people have continued to ﬁnd new ways to demonstr ate these behaviours while adjusting to dier ent ways of working. Delight custom ers Innovate to gro w Collab orate to wi n Safeguard our future Val ue eac h other The Experian Way External rec ognition across the globe Fev/2021 - Fev/2022 AUG 2021 - AUG 2022 USA AUG 2021 - AUG 2022 COSTA RICA BRASIL 48 T ransforming live s by Racial inequality is a very real problem in Br azil. It is a massive challenge to over come and there is a long road to go given the sy stemic problems in society . Y et I’m optimistic about the future. W e’re going in the right direction and we ar e focused on implementing real change, fast. I’m really pr oud about how everyone at Ser asa Experian is working together to be part of the tr ansformation. Natasha Santos HR analyst and leader of Black ERG, Serasa Experian, Brazil respond i ng to r a cial i nequ alit y in B r azil Many people’s image of Br azil is one of sandy beaches, carniv als, and a melting pot of cultures. However , it is grappling with a historic al legacy of r acial inequality stemming from the 4m black people enslaved and tr acked from Afric a. While slavery in Br azil was ﬁnally abolished in 1888, policies wer e later put in place that continued to discriminate against black people. These included blocking them from certain jobs, preventing them fr om buying homes in particular areas, and for cing them to live in neglected favelas. These policies were, unfortunately , highly eectiv e and their impact still ripples through Br azil today . The repr esentation of black and mixed-r aced people in higher education is low , and on aver age they earn half the income of white people. 64% of the prison population are black or mixed r ace compared with 54% of the general population, and black and mixed-race people suer from r acial microaggr essions or worse on a daily basis. Recently , ther e has been a wider acknowledgement that these problems exist and that there needs to be an active r esponse to over come them. At Experian we want to be part of the solution, r eﬂecting our commitment to a culture of diversity and inclusion. As part of serving the community we are focused on helping mar ginalised populations, speciﬁc ally black and mixed-r ace, thr ough our ﬁnancial education volunteering pr ogrammes, as well as promoting our free ﬁnancial tools that can help r educe debt, impr ove credit scor es and help people access the credit they need. Inside our business we have identiﬁed that just 20% of our workfor ce in Brazil ar e black, compared with over half of the Br azilian population, so we are working to impr ove the black repr esentation. W e have launched a mentorship progr amme between senior employees and black employees to help support them in their car eers. And our senior leader s are engaging in reverse mentoring, so they are aware of and under stand the challenges that black employees face. In response to a r ecent employee survey in which 60% of black respondents said that not understanding English was a signiﬁc ant barrier to them at work, we ar e launching subsidised English lessons. W e are also ensuring that new trainees and interns joining the compan y are given r oles that don’t requir e English. We hope that we c an start to make a dier ence and ensure a better quality of life for everyone, regar dless of their race. 49 Experian plc Annual Report 2021 Strategic report Continuing to build and celebrate our diverse and inclusive cul ture Through a year of our people working predominantly r emotely , we have been able to really bring to life our focus on inclusion. We have been welcomed into people’s homes through the medium of video c alls, seen our team-mates with their children, partners and pets, we hav e discussed the impact of the pandemic on each of us and, as a r esult, ha ve got to know each other more deeply as individuals. W e have continued to work and have experienced ﬁrst -hand that people who feel able to bring their whole selves to work can achieve great r esults. This year our Group Oper ating Committee announced commitments to ﬁve key focus areas for DEI, as shown on the right. Our leadership commitment is clear , and we ar e fortunate this is matched by our employees’ passion and drive on this topic – seen through the continued success of our Employee Resource Gr oups (ERGs). Globally , we now have over 30 ERGs. They continue to r aise awareness, inspire involv ement, and encour age action on a broad r ange of topics. Employees have created two more ERGs this year in the UK and Ir eland. One is Black at Experian, which exists to cr eate a safe and inclusive envir onment for people of black heritage to work, access opportunities and grow and fulﬁl their potential. The other , the Disability Network was launched to help the business think dierently about disability and how we can be mor e inclusive. Our global commitment to recognising and celebrating international diver sity events has thrived virtually , with r egions hosting a range of events to mark International W omen’s Day , International Men’s Day , Pride, International Day of Persons with Disabilities and World Mental Health Day , as well as celebr ating additional local tr aditions. All r egions published Diversity and Inclusion Reports to celebr ate their achievements and set out areas of focus for the coming year . W e have pro vided DEI-related 1. High-level corporate leadership 2. T reat all women and men fairly at work, without discrimination 3. Employee health, well-being and safety 4. Education and training for car eer advancement 5. Enterprise development, supply chain and marketing pr actices 6. Community initiatives and advocacy 7. Measurement and reporting UN W omen’s Empowerment Principles training in all r egions – with North America launching Consciously Unbiased, a new , multimedia approach to r aising awareness. The topic of allyship has been centr al to our focus this year , with How to All y guides launched globally to ensure all employ ees can play their part in making Experian an inclusive place to work. Our Acceler ated Development Progr amme (ADP) in Global Decision Analytics, designed to support talented women at mid and lower tiers to progr ess in the organisation, saw great success, with 44% of the participants being promoted after the pr ogramme. The Women in Leader ship DiveIn (WILD) progr amme in Asia Paciﬁc, designed to give real and r aw experiences of leadership development and car eer acceleration for women, concluded with an 88% r etention r ate and 71% of women experiencing development of their roles since ﬁnishing the pr ogramme. In Experian Information T echnology Services (EITS), we launched Adv ancing W omen Leaders in T ech, a nine-month leadership-development progr amme for high-potential employees. We ha ve also built upon our commitment through sever al partnerships outside of the business. W e became a global signatory of the United Nations W omen’s Empowerment Principles (WEPs), which pr omote gender equality and women’s empowerment in the workplace, mark etplace, and community . In the UK and Ireland, we signed the Business in the Community Race at W ork Charter , and bec ame a signatory supporting Stonewall’s T rans Rights Are Human Rights c ampaign to help reform the Gender Recognition Act (GRA) 2004. W e also became an ocial partner of W omen in Data for the very ﬁrst Women in Data week in the UK. In North America, we established a partnership with Disability: IN, the leading non-pr oﬁt resour ce for business disability inclusion worldwide. W e’ve been a sponsor of events that support us in building diverse pools of future talent, including Afr oT ech, one of the lar gest multicultural technology confer ences in the USA, and Gr ace Hopper Celebration, the world's largest gathering of women in computing. In recognition of our eorts and achievements, we are pr oud to have been awar ded several distinctions through FY21 which r eﬂect our culture and our commitment to a positive and inclusive environment f or our people. It is impossible to discuss DEI in 2020 without referring to the tr agic death of George Floyd and the resulting spotlight upon r acial inequity in society . This focus cr eated introspection on a personal and corpor ate level, and while we feel good about everything we have done and the progr ess we have made, we know there is mor e to do. In dir ect response, we announced donations to Operation HOPE, double-matching of employee donations to associated causes, and established a Product Review T eam to ensure our pr oducts address the needs of black 1. Activ e sponsorship We ha ve appointed executive sponsors for ﬁve areas of our DEI focus. They each sit on our Group Oper ating Committee, ensuring these topics arer epresented in decision-making atthe highest level. Gender: Jennifer Schulz, Group President, V ertical Markets Race and Ethnicity: Cr aig Boundy , Chief Executive Ocer , North Americ a L GBTQ+: Jose Luiz Rossi, Managing Director , UK and Ireland Disability: Ben Elliott, Chief Executive Ocer , Asia Paciﬁc Mental Health: Lloyd Pitchford, Chief FinancialOcer 2. Better understand our opportunities and challenges We believe that it is critic al that we have a deep understanding of the make-up of our population and their experience of working here so we c an set relevant goals and dev elop meaningful DEI progr ammes and practices. In the coming year we will focus on improving demogr aphic data and our people will be asked to take part in a voluntary census. Our 5 key c ommitments for diversity , equity and inclusion (DEI) 4. Ensure accountability We will be holding annual str ategic reviews chaired by our CEO focused on DEI. We will also have bi-annual DEI deep dives and quarterly reviews with each r egion to monitor our performance closely and take quick action where needed. 5. Support our people We ar e developing a global Conscious Inclusion training pr ogramme to ensure that we all understand the importance DEI holds for our people, our business and our customer s. 3. Measure pr ogress against speciﬁc goals We ar e also raising our ambition and setting three- year targets for gender div ersity . Our current global gender diversity and FY24 gender targets ar e: Representation of women FY21 FY24 Senior Leaders 32% 40% Mid-Level Leaders 35% 42% T otal workforce 44% 47% Sc an me T o read more about our DEI jou rney and se e our ﬁrs t glob al DEI report. Experian plc Strategic r eport 50 Emerging Leaders Programme Ambition Programme Accelerate Ambition High Perfor mance Mastercl ass CEO Forum Experian Busin ess Network Elevate Lea rning / Ge tA bst rac t / Dev elop ment G uide s Acc eler ate d Dev elop ment P rog ramm es fo r wome n, e. g. AD P , WI LD New Leader Programme Elevate Performance Modules + Amplify 1 Senior Leadership Senior Managers Middle Managers All Line Managers All Levels 1 ,000 + participants took part in our ﬁrst global hackathon, forming almost 100 teams, with winners being selected across our ﬁve global strategic focus ar eas. Glassdoor score 4.2 4.0 3.8 3.6 3.4 3.2 3.0 2.8 2.6 Jan 2 0 16 Jan 2 018 Jan 2 0 17 Jan 2 0 19 Jan 2020 Jan 20 21 Glassdoor trend 2016-2021 and other disadvantaged communities. Throughout the period since, we have focused on disadvantaged communities through our United for Financial Health progr amme, forming partnerships with groups such as the NAACP , Black Girl Ventur es, the T russell T rust and The Mix. T o ensure we ar e clear about the gaps and opportunities in our DEI work, and to r eﬂect our commitment to continuous improvement, we launched an independent audit through an external partner . The ﬁndings will inform our FY22 DEI strategy . Hiring and developing our world-class workforce Our ability to continue to attract world-class people is critical, and we have continued to invest in a strong pr esence on social media in support of this. Our Experian Cr eator series is live across all major social channels, highlighting innovation thr ough product stories. We ar e proﬁling our current tech talent weekly on LinkedIn and other social media, targeting future talent tech gr oups (such as Girls Who Code) and early talent. Our c areers site no w has a page dedicated to technology and innovation, featuring product stories, Creator series highlights, technology -leader content, and open tech roles. In FY21 our social media following increased, now with over 1 million follower s. Furthermor e, our hires sour ced via social media channels reached 53%, far surpassing our FY21 target of 29%. We ar e proud of how we adapted to hiring and onboarding our colleagues r emotely and have assigned buddies to all new joiners to help them integrate eectively in a virtual world. Results are good, with 96% of new joiners feeling positive about their onboarding experience, a 2%increase in the last year . This strong internal sentiment is matched by external measures: weexceeded expectations by impro ving our Glassdoor score for the ﬁfth year in a r ow , sitting4.1 out of 5.0 in March 2021. Development of our people has remained central to our work – with the focus shifting to remote-learning opportunities. W e were well placed with our on-demand, access-an ywhere Elevate Learning platform, launched in 2019, and have continued to make the most of it throughout the year . Our partnership with Pluralsight supports our technology -focused employees in keeping their skills r elevant, given the frequent need for new c apabilities. Our employees consumed almost 15,000 learning hours on the platform this year . Our Stepping Stones tool, developed internally , enables our people to match their skills to short-term projects, or ‘gigs’ , to build capability and apply new skills in ways they may not have the opportunity to do in their main roles. In addition, Stepping Stones has helped us re-distribute work and create a balance between those with reduced c apacity and those who can absorb more and over 1,000 employ ees have now register ed for opportunities. In Global Decision Analytics, we r an Be World Ready , an initiative to help employees build their personal employability . The progr amme also encour ages employees to stay connected to the external job market, to keep their skills and experiences relevant. Finally , the pandemic has placed high demands upon our leaders to manage in new ways. W e have taken the opportunity to review and revamp our global manager tr aining progr amme, which we have relaunched as theNew Leader Progr amme. It is designed todevelop well-r ounded leaders who can leadtheir teams eectively , beyond technicalcapability and focuses on ar eas suchas inclusion, psy chological safety , engagement, high-performing teams, andagility around change. We ha ve kept up our commitment to pro viding strong support for functional skills development. This year we r an our ﬁrst cohort of the Global Analytics bootcamp. These ar e interactive immer sive workshops, delivered byour own experts, that pr ovide intensive hands-on experience in Advanced Analytics andArtiﬁcial Intelligence. W e also ran our ﬁr st ever global hackathon based on ideas and collaboration for r ecovery after COVID-19. Over 1,000 participants took part, forming almost 100 teams, with winner s being selected across our ﬁve global strategic f ocus areas. The winners received a lar ge donation for the charity of their choice, and signiﬁc ant investment in developing their solutions. Our high-performance culture has pr ovided critical security this year , bringing clarity for employees in an unstable and uncertain environment. We have continued evolving this Our sustainable business strategy: Envir onment, Social and Governance contin ued 1 A mpl if y – ref res her s ess ion s for th os e who ha ve pr evi ousl y be en th rou gh our h igh pe r for manc e pro gra mme s (Hig h Perfo rmance M asterclass , Accelerate Ambition, Ambition) 51 Experian plc Annual Report 2021 Strategic report Working with integrity is one of our cor e values and central to The Experian W ay of working. Our Code of Conduct, av ailable in sever al languages, sets out clear guidance to help everyone at Experian make the right decisions. It is supported by detailed policies on speciﬁc topics such as anti-corruption, gifts and hospitality , fraud management, complaint management, fair treatment of vulner able consumers, product development and marketing, whistleblowing and tax. Anti-bribery and corruption We tak e a zero-toler ance approach to bribery or corruption in our business and our supply chain. Our Global Anti-corruption F ramework prohibits facilitation payments, kickbacks, or any form of bribery or corruption. The accompanying Global Gifts and Hospitality Policy sets out strict ethical standar ds relating to gifts, entertainment, hospitality , sponsor ship, tra vel expenses and donations. W e also have controls to ensur e we conduct any sponsorships, charitable contributions, lobbyingor political donations ethically and incompliance with all relevant la ws. Our suppliers are contr actually obliged to ensure their employees, agents and subcontractor s refr ain from paying or r eceiving improper bribes, facilitation payments, gratuities or kickback s. If we identify an y suppliers as high risk for bribery or corruption, we refer them to the Compliance team for further due diligence, including an assessment of corruption, r egulatory and reputational risk s. Eective assessment and mitigation of corruption risks ar e a critical component of ourCompliance Management Progr amme forthe business, and we conduct periodic assessments check for corruption risks. W e also follow rigorous due diligence pr ocedures toidentify any risk of improper payments during mergers and acquisitions, or when weenter into joint ventures. Our Finance and Global Sourcing teams havetr aining and controls to detect and stop improper payments, with support from our Global Internal Audit team. If we identify an y concerns, we pr omptly investigate them and take appropriate action. T raining and compliance All employees (including part-time employ ees and contractor s) complete mandatory training on our Code of Conduct and on anti-bribery and corruption when they ﬁrst join Experian. Thereafter , they must complete refr esher training every one to two y ears and we make sure that they do so thr ough our performance review pr ocess. We also expect managers to be positive role models for ethic al behaviour . Any breaches of our Code of Conduct or associated policies could undermine our reputation and stakeholder trust. Our Three Lines of Defence risk management model reinfor ces our culture of compliance, and we encourage people to r eport any suspected policy breach or unethic al activity without fear of reprisals. W e ask employees to start by talking to their manager if they have concerns. Employees and third parties c an also report an y concerns, anon ymously if they choose, thr ough our 24-hour Conﬁdential Helpline. We tak e any allegations of ethical br eaches very seriously . All r eported concerns are investigated by relev ant functions, such as Human Resources, Global Security Oce or Global Fr aud Investigations, to identify root c auses andtake appropriate corr ective action. This year , 37 concerns wer e reported. The majority of these, 78%, concerned human resources related matters. Respecting human rights We ar e committed to respecting human rights and upholding the United Nations Universal Declaration of Human Rights (UDHR) and the UN Guiding Principles on Business and Human Rights (UNGP) in our business and supply chain. Everyone at Experian completes tr aining on ourGlobal Code of Conduct, which sets out clear standards to avoid an y infringement ofhuman rights. We ar e committed to treating all our people fairly and with respect. Experian is an accredited Living W age employer in the UK,going beyond the legal minimum wage topay employees the amount the Living W ageFoundation has c alculated they reall y need to live on. This year , we ha ve strengthened our focus on DEI globally (see page 49) and will publish our ﬁrst Global DEI Report to enhance disclosur e on this important topic. W e have signed up to the UN W omen’s Empowerment Principles, and our North American business r eceived a perfect score fr om the Human Rights Campaign F oundation’s 2021 Corporate Equality Index on policies and practices for L GBTQ+ employees. Our Supply Chain Principles set out clear standards on human rights, and we include clauses in our contracts that oblige supplier s toprotect worker s’ rights and freedoms. We monitor compliance through our thir d-party risk management framework. We also expect suppliers to set similar requir ements for their own suppliers and subcontr actors to extend high standards thr oughout the supply chain. W orking with integr ity part of our culture, with our approach being further woven throughout our leader ship development progr ammes. W e launched Amplify - a new opportunity for leaders who have previously been thr ough our high- performance progr ammes - to re-group and refr esh their thinking with the high-performance principles central to our or ganisation and focusing on what matters most now , in this ‘newnormal’ . T o establish high performance throughout our or ganisation, all employ ees now have access to a series of high-performance content explaining our philosophy at Experian. We ar e also building upon the success of the Elevate Performance platform for y ear-r ound performance management. We have run a pilot of an augmented platform which fully integr ates an employee’s performance goal with development plans – linking directly to r elevant learning materials. T eams can also run ‘check -ins’ , a simple but frequent online interaction, helping them communicate. The platform will go live in FY22, to support more powerful discussions on performance. While we build technical skills for the futur e, wealso plan for the future of our br oader leadership roles and ar e proud of our healthy approach to succession. This year 89% of our top-100 leadership roles ha ve at least one identiﬁed successor ready now or within two years; while over 50% have two or mor e potential successors. Looking forward The pandemic has requir ed us to think dierently about the way we work in the futur e, and we have embr aced this opportunity to create gr eater ﬂexibility for our people. W e havespent consider able time listening to our employees, tracking k ey measures of how we work, watching how norms ha ve shifted and analysing how to make our appr oach a success. The ‘new normal’ at Experian will be a ﬂexible one, and this is not just about r emote working, it's our commitment to make a dierence in our people's working lives. Our people will ha ve the opportunity to work in a way that works for them – this may be working remotely , in the oce, or a mix of both, as well as ﬂexibility over start and ﬁnish times. Our aim is to strik e the right balance between what works for an individual and what works for the business – we believe both are critic al. Our new appr oach is built on trust, ﬂexibility and enabling success and as we undergo this shift and all the operational changes that will fol low , we are placing a strong focus on r einforcing intangible anchors like values, behaviours and employee experience to ensure everyone in their o wn way can thrive in a mor e remote and ﬂexible world. Experian plc Strategic r eport 52 Victi ms o f modern s lavery of te n ﬁnd the y ha ve also been th e victi ms of frau d and i den tity theft. W e work ed with Ho pe for J usti ce t o ad ap t ou r authentication proces s to help sur vivors , who of ten ha ve l ittle or n o docu ment ati on t o pro ve wh o the y are , get a ccess t o th ei r cred it report s a nd resol ve fraud ulen t debts th roug h our di sput e process. This year , our funding has helped Hope for Justice support nearl y 500 modern slavery survivors in the UK with advoc acy and advice services – from language tr aining and job skills to ﬁnancial , legal and mental health support. We also helped Hope f or Justice reach over 15,000 people in vulnerable communities thr ough Facebook Live Sessions during the COVID-19 restrictions. A data model we developed is helping Hope for Justice focus its resour ces in parts of the UK where they c an have the greatest impact and we ha ve provided a similar model to help the or ganisation choose where to loc ate support hubs in the USA as they grow their pr esence in North America. W e are tr emendously proud of our profound r elationship with Experian and have been absolutely delighted to see what incredible outcomes ha ve been achieved over the past year , as a direct r esult of our partnership. Our collabor ation continues to build resilience within potentially vulner able communities, assists victims to freedom and empower s survivors towards sustainable r emedy and lasting independence. W e are excited to see what the future holds, and – together - to reach even mor e people whose lives have been impacted by this abhorrent ar ont to freedom. Paul McAnulty UK & Europe Pr ogramme Dir ector , Hope for Justice T ransforming live s by sup p o r t ing sl aver y sur v i v or s 53 Experian plc Annual Report 2021 Strategic report T ackling modern slavery Supplier risk assessments and in-depth training help pr ocurement teams identify risks of modern slavery in our supply chain, and take action if they have any concerns. Our Slavery and Human T racking Statement pro vides further information on our commitment, policies and actions to tackle modern slavery risks in our business and supply chain. Experian is a founding member of the Slave-F ree Alliance, which brings together businesses working towards a slav e-free supply chain. F ollowing a comprehensive assessment of our approach by the Slave-F ree Alliance, we ar e completing a three-year improvement plan to impr ove our processes for identifying and preventing modern slavery risk s in our supply chain. A quarterly steering gr oup, headed by our Group Chief Pr ocurement Ocer and Head of Strategic Pricing, manages implementation of the plan. W e have also invited members of the Slave-F ree Alliance and our charity partner Hope for Justice to provide expert guidance. Fir st steps this year included assigning responsibility for mitigating risk s and implementing improvements to the owner s of relevant ar eas of the business. We ar e using our data and analytics to support wider eorts to tackle modern slavery , and contribute to the United Nations’ Sustainable Development Goal to eradic ate forced labour . Our DataLabs are collabor ating with the United Nations University Centre f or Policy Resear ch and the University of Nottingham’s Rights Lab to develop an ‘analytical sandbox’ that will use a combination of datasets to help pinpoint locations that may be vulner able to modern slavery risks. We ar e also working with Hope for Justice to support survivors of modern slavery . Partnering with supplier s Our Supply Chain Principles and Code of Business Conduct repr esent the minimum ethical, labour , human rights and envir onmental standards that all Experian suppliers must meet. As part of their contr acts with us, all suppliers must conﬁrm that they accept our standards or have their own equiv alent standards in place. We integr ate risk management and compliance in our supplier selection process, alongside commercial consider ations. W e use our third-party risk management fr amework to conduct due diligence on suppliers and third parties before we work with them, and assess and monitor risks thr oughout our working relationship. Our Thr ee Lines of Defence controls support compliance. We conduct a risk assessment of all the thir d parties we work with, including supplier s and indirect clients. Overseen by our Thir d Party Risk Management team, we assess risk s related to data security and privacy , business continuity , compliance and r eputation (including bribery , corruption and modern slavery). Of the thousands of third parties we work with, most fall into the minor or moderate risk category in our initial risk assessment. Those we consider higher risk – based on factors such as the type of product or service they pr ovide and the type of data they have access to – are subject to more in-depth assessments, oversight and contr ols. As our ﬁrst line of defence, the business function that owns the relationship with the third party is r esponsible for identifying, tracking and r esolving any issues. Periodic reports on key supplier s, dr awn from news sources ar ound the world, help us monitor risk s in our supply chain by alerting procur ement teams and supplier relationship managers to any issues. This year , we ha ve strengthened our pr ocesses for ongoing monitoring of higher-risk suppliers and third parties to include periodic sampling and testing of controls to ensur e our standards are upheld. If we identify any gaps in contr ols, we log these in our centralised global governance, risk and compliance sy stem, and track issues thr ough to resolution. W e will not work with – and routinely r eject – third parties that do not uphold our standards on critic al issues, such as data security . We ar e committed to supporting diverse suppliers through our str ategic sourcing process that is designed to oer a level playing ﬁeld for all third parties. In the USA, we support women and minority-owned suppliers as a member of the National Minority Supplier Development Council and the W omen’s Business Enterprise National Council. Diver se suppliers account for around 6% of our US base. T o support our climate strategy , we are working with our most carbon-intensive suppliers to request data to help us get a better understanding of our Scope 3 carbon footprint (see page 56). Our Environmental P olicy commits us to minimising the impacts associated with our business activities. Impr oving our environmental performance is managed and communicated at Boar d level. As an information services business, the main environmental impact we contr ol is the carbon footprint of our oces, data centr es and business tra vel. We ar e also working to better understand and manage the climate impact of our supply chain, and aim to r educe our environmental footprint further b y eliminating the use of single-use plastic in our facilities as far as possible. Our TCFD statement In March 2021, Experian became an ocial supporter of the T ask F orce on Climate-related Financial Disclosures (T CFD). W e are committed to aligning our corporate r eporting with the TCFD r ecommendations and early reporting on the majority of its requir ements before it becomes mandatory for us in FY22. Governance Experian has a long-established process for identifying, assessing, responding to and reporting business risk s through the Global Risk Management framework that combines a bottom-up approach at a r egional and business unit level, and a top-down appr oach at a global level. Risks ar e identiﬁed and assessed at project and regional level, overseen by the Str ategic Project Committees and Regional Risk Management Committees that report to the Executive Risk Management Committee (ERMC), on a quarterly basis. The Board has over sight of climate- related issues along with the Audit Committee, which oversees a r esponse for global risks and opportunities, including climate change. Our carbon neutr al plan, published in June 2020, is an example of our long-term str ategy to mitigate the impacts of climate change. Regular updates on our plan are pr esented to the Group Oper ating Committee. The Board also receives r eports of our corporate r esponsibility activities and performance from the Chief Executive Ocer at every Board meeting. These reports include pr ogress made on str ategic drivers to address climate-r elated issues (for example, our science-based tar get and TCFD reporting). In 2021, the ERMC endorsed both our science-based target and this T CFD statement, prior to Board appr oval. Regionally , our established en vironmental management system (EMS) demonstr ates best practice in minimising the en vironmental and climate impacts of our business, ensuring we Prote cting the environm ent Experian plc Strategic r eport 54 comply with local r egulations and continuously improve our performance. Where certiﬁed, regular management r eviews of the EMS ar e performed, in volving regional leader ship, to ensure the objectives of the management system are being met, the system is eective, and risks and opportunities ar e reviewed. Thr ee of our sites in the UK and our site in Bulgaria are certiﬁed to ISO 14001:2015. These loc ations are externally audited to ensur e conformity with this standard, and we align all our oper ations globally to this standard, which is internationally recognised as best pr actice. In FY21, we str ategically reviewed existing and future climate change risk s and opportunities with a multi-disciplinary group of stakeholder s across the business, repr esenting each geographic r egion we operate in. The output of this was to: Identify and assess climate-related risk s and opportunities to our business arising from climate change Conduct climate scenario analysis to help understand the long-term impacts of climate change on our business model Ensure climate-r elated risks are fully incorporated into our established risk assessment framework Identify risk owners to develop the c apability in the management team for assessing and managing the identiﬁed risks. Strategy Experian recognises the signiﬁc ance of climate change to our stakeholders and we ar e committed to identifying, addr essing and managing risks and opportunities pr esented by climate change both now and in the future. We have been responding to the CDP climate change questionnaire since 2007, which is aligned with the T CFD recommendations, and most recently achieved an ' A -' leadership r ating. Our climate change strategy includes a commitment published in June 2020 to become carbon neutr al across our own oper ations by 2030, an example of the long-term str ategic approach we ar e taking to respond to the physical and tr ansitional risks associated with climate change. Our c arbon neutral plan incorporates a science-based tar get to reduce our global carbon emissions and pur chasing certiﬁed carbon cr edits to oset unavoidable, residual emissions acr oss our direct oper ations (Scope 1 and 2). W e are gr adually phasing in carbon osetting between 2021 and 2025 (see page 56). Our sustainable business strategy: Envir onment, Social and Governance contin ued ' A-' leadership c ategory Failur e to adapt products and services to changing markets Reputational impact of failing to meet climate change commitments and targets Failur e to disclose ESG performance to investors and customers Failur e to incorporate climate risk on in vestment decisions exposing Experian to ﬁnancial risk (e.g. pension investment) Failur e to comply with climate change policy/ regulation Lack of access to sustainability-linked ﬁnance (green investment bonds, sustainability-linked bonds) Minor Moderate High Chronic impact of climate change leading to climate migrants' loss of cr edit history and constraints to data tr ansfer Disruption to power supply in data centres Intermittency of grid supplied power and rising operating costs Attracting, engaging and r etaining employee talent through r esponsible business strategy including climate change Interruption to Experian supply chain as a result of extreme weather Third-party services being disrupted by extreme weather and associated grid power disruption Unstable carbon market for purchasing c arbon credits Increased energy demand for oper ating data centres, providing cooling as the global mean temperatur e increases Increased operational cost fr om direct impact of climate change policy/regulation Increased operational cost fr om indirect impact (supply chain) of climate change policy/ regulation Extreme weather impacting customers in operating markets During the last year we have engaged with ourtop 20 strategic global supplier s, acknowledging the indirect envir onmental impact of our business operations. Our supply chain plays an important role in achieving our carbon r eduction target for Scope 3 and we ar e keen to explore opportunities that c an help to accelerate our dec arbonisation plan. We will expand the scope of the engagement in future years to include a gr eater number of suppliers and prioritise those with the most material environmental impact. We ha ve reviewed our climate risk s and opportunities that exist across our business lines, and acr oss the regions in which we operate, by engaging with key internal stakeholders. This pr ocess has enabled us to create a compr ehensive climate risk and opportunity register identifying a wide r ange of physical and tr ansitional climate-related risks and opportunities across short (one to two years), medium (two to ﬁve years) and long-term (ﬁve or more year s) timeframes. This climate-speciﬁc risk and opportunity register has been developed in accordance with the Global Risk Management framework to ensur e this was performed as a fully integr ated process. The risks included in the matrix below have been identiﬁed as part of the recent str ategic review , and ha ve been classiﬁed based on their inherent risk (befor e control measur es have Possible Probable V ery likely 55 Experian plc Annual Report 2021 Strategic report Step 1 Risk identiﬁcation Step 2 Risk assessment Step 3 Risk response Step 4 Risk reporting & monitoring been considered). The standar d process for risk classiﬁcation is based on r esidual risk (once control measur es have been fully consider ed and reviewed). This will be a priority for FY22. In FY22, we will complete our journey to r eport in full alignment with the T CFD recommendations and will perform climate scenario analysis using high and low carbon scenarios. This analysis will systematic ally review our assets acr oss the globe against a series of region-speciﬁc climate-r elated hazards (for example, water stress, susceptibility to drought and incr eased rainfall events) based on speciﬁed increases in mean temperatur e. This scenario modelling will be performed using recognised climate models such as RCP 2.6 and RCP 8.5 1 that explore well below 2°C (low carbon scenario) and 4°C (high carbon scenario) climate change pathways r espectively . This will enable us to assess our exposure and vulnerability to climate-r elated risks, quantify the ﬁnancial impact of climate-related risk s and opportunities, and demonstr ate the resilience of our strategy when we consider the futur e impact of climate change. Metrics and targets We measur e, externally assure and publicly report our c arbon footprint (see table on page 56). In or der to accur ately reﬂect our r enewable electricity consumption, we ar e shifting our emissions metrics from using loc ation-based Scope 2 emissions to market-based Scope 2 Consider key business objectives Identify principal risks Identify key controls Assess controls Estimate likelihood, impact and velocity Consider legal, reputation and conduct exposure Accept or r emediate current risk and control envir onment Determine correctiv e action if needed Business unit and regional level RRMCs and ERMC Audit Committee 1 Re pre sen tat ive C arb on Pa thwa y 2.6 (R CP 2. 6) is a cli mate m ode l bas ed on a g ree nho use ga s pro jec tio n that r equ ire s glob al CO 2 e start de clin ing by 2 020 an d rea ch zer o by 2100, re pre se ntin g a ‘be st- cas e sc enar io’. RCP 8 .5 is a cl imat e mod el ba sed o n a gre enh ous e gas projection that projects global CO 2 e co ntinu e to ri se, r epr es entin g a ‘wo rs t-c ase s cena rio’ o f clim ate ch ang e. 2 T his ye ar, we have u pda ted th e way w e calc ula te our t otal g ree nho use ga s emis sio ns by u sing o ur Sc ope 2 m arke t-ba se d rat her th an th e Sc ope 2 l oca tio n-b ase d ind ica tor. This e nabl es us t o fac tor in t he re new able e ner gy we p urc hase a nd he lps t rac k our p er for manc e aga inst ta rget s an d our c arb on ne utr al com mit ment . 3 A ls o know n as ‘F uel- and -e ner gy- rel ate d act iv itie s’, is an av era ge of al l the g ree nhou se ga s emis sio ns rel eas ed in to the a tmo sphe re fr om th e pro duc tio n, pr oce ssi ng and d eli ver y of a f uel o r ene rgy. Climate-related risk s are identiﬁed using the established Global Risk Management framework as detailed on page 72 of this r eport . This framework combines a bottom-up approach of engaging with loc al subject matter experts (First and Second Lines of Defence), who have in-depth knowledge of business activity , with a top-down appr oach (Third Line of Defence) that conducts a strategic r eview of the risks. The following process ensur es risks are appropriately identiﬁed, addressed and managed. This process is completed at least twice a year to ensure that it r emains appropriate and that any new activities or changes to variables have been captur ed. Key risk s that are identiﬁed as a result of this pr ocess are maintained in the Global Risk Inventory , r eviewed by the ERMC, approved by the Audit Committee and pr esented to the Board. At pr esent, climate change is classiﬁed as an emerging risk. emissions 2 . Our emissions in FY21 dr opped by 58% compared with the pr evious year . This reduction was due to a combination of factors, including the intermittent closure of our oces as a result of loc al COVID-19 restrictions, increased use of r enewable energy contr acts and a reduction in business tr avel. Our total carbon footprint this year was 16.8 thousand tonnes of CO  e, down from 40.3 thousand tonnes the previous year . The carbon intensity of our business decreased by 60% to 3.1 tonnes per US$1m of revenue. We continue to invest in energy eciency technologies in assets around the globe and ar e progr essively sourcing mor e renewable electricity . In FY21, 34% of our electricity consumption was from renewable sour ces. This year , we set our science-based tar get: Scope 1 and 2 (1.5 degree scenario): T o reduce absolute Scope 1 and 2 emissions by 50% by 2030 2 (from 2019) Scope 3 (2 degree scenario): T o reduce Scope 3 emissions from pur chased goods and services, business tr avel and Well - T o- T ank 3 by 15% by 2030 (from 2019) T o enable the delivery of our Scope 1 and 2 target and c arbon neutral plan we have work ed with colleagues across the globe to identify carbon r eduction, ener gy eciency and renewable ener gy opportunities. T o date, o ver 40 projects have been identiﬁed. Throughout FY22 we will continue to work towards implementing these projects to drive pr ogress towards our 2030 commitment. T o achieve our Scope 3 target, we will engage with our suppliers to minimise the indirect environmental and climate impact of the products and services we pr ocure. We have already engaged our top 20 suppliers to understand their climate str ategies including commitments to science-based targets and net zero str ategies. This engagement will lead to the identiﬁcation for collabor ative opportunities to reduce the c arbon intensity of the products and services that we purchase and also discuss strategic opportunities such as the use of renewable electricity , adoption of electric vehicles, end-of-life takeback schemes, eliminating the use of single-use plastics and minimising packaging. We will continue to monitor the levels of business tra vel in FY22 as trav el corridors reopen however , we do not expect business tra vel to return to pre-pandemic levels. Reducing emissions from buildings The COVID-19 pandemic has acceler ated the move to more ﬂexible working. Almost our entire workfor ce moved to full-time homeworking this year , with just a small number of employees working on site to keep our facilities and data centres going. W e plan to maintain a more ﬂexible appr oach to working as we prepar e for a post-pandemic new normal (see page 51). Further consolidation of oces, together with increased use of r enewable energy , will help to reduce emissions fr om our buildings. This year , we switched to renewable ener gy at three mor e oces in the UK and Ireland and North Risk management Experian plc Strategic r eport 56 Assessing Scope 3 emissions In previous year s, we hav e only track ed and reported Scope 3 emissions r elated to air tra vel. In FY21, we engaged external experts to undertake a full assessment of our Scope 3 emissions, using best pr actice models and a combination of procur ement and ﬁnancial data available for FY19, the last full year before the exceptional circumstances of CO VID-19. This initial analysis estimated our baseline Scope 3 emissions in FY19 as 495.3 thousand tonnes. The biggest contributor to this total is purchased goods and services (72%), followed by business tra vel (10%) and capital goods (6%) (see data table). T o improve the accur acy of these estimates, we are r equesting more detailed information fr om suppliers on the portion of their emissions attributable to the products they supply to Experian. W e are also engaging with suppliers to understand whether they have carbon reduction pr ogrammes or science-based targets in place. Capturing climate-related opportunities Climate-related opportunities identiﬁed for our business include: Developing products and services to support customers in response to acute and chr onic weather-r elated impacts of climate change Accelerating the tr ansition to a low carbon future by enabling customers to access cr edit facilities to support the low carbon economy Providing insights about the carbon impact of products and services to inform the consumer decision-making process Accessing green investment funds by demonstrating a str ong climate change strategy and eective management. We ar e already developing new climate-related products and services. Our UK DataLab team is building a tool to support clients in developing their climate change risk disclosures to meet guidance from the T CFD and the UK Financial Conduct Authority (FCA). As part of a leader ship development progr amme, our Business Information Services team in North America is exploring a solution to help clients build information on environmental impact and sustainability into their evaluations of suppliers or lending applications. Through our Social Innov ation progr amme, we are developing an agricultur e index to support clients in oering aordable ﬁnance and insurance to smallholder farmer s, which c an help boost their productivity and pr otect them from climate risk s. Our sustainable business strategy: Envir onment, Social and Governance contin ued CO  e Unit 2021 2020 2019 Scope 1 000s tonnes CO  e 2.2 3.0 3.6 Scope 2 (market-based) 1 000s tonnes CO  e 14.3 22.1 25.6 Scope 3 (air trav el only) 2 000s tonnes CO  e 0.3 15.2 14.3 T otal emissions 1 000s tonnes CO  e 16.8 40.3 43.5 Scope 2 (location-based) 3 000s tonnes CO  e 22.2 25.5 29.8 T otal Scope 1 and 2 3 000s tonnes CO  e 24.4 28.5 33.4 T otal Scope 1 and 2 3 normalised by revenue – per US$1m revenue tonnes CO  e 4.5 5.5 6.9 T otal energy consumption in the UK 4 GWh 25.5 27.2 29.5 1 C alcu lat ed wi th Sc ope 2 m arke t-b ase d car bon e mis sion s. We h ave ca lcul ate d mar ket- bas ed Sc ope 2 e mis sion s usin g ele ctr ici ty sup pli er emi ssi on fa cto rs wh ere a vail abl e. Wh ere s uppl ier f act ors a re no t avai lab le, we u se re sid ual em issi on fa cto rs wh ere ava ila ble. I f re sidua l emis sio n fac tor s are n ot av aila ble , we use l oc atio n- bas ed em issi on fa cto rs . 2 S cop e 3 incl ude s emis sio ns fr om gl obal a ir tr avel . In F Y21 air t rav el emi ssi ons ha ve be en c alcu late d usin g Rad iati ve For cin g (RF ) emi ssi on fa cto rs fo r the ﬁ rst t ime an d we int end t o cont inue t o rep or t on th is bas is in th e fut ure . For c ompa ris on, t he no n- RF re por te d ﬁg ure wo uld b e 0. 1. 3 L oca tio n-b as ed ca rbo n emi ssio ns. W e have c alcu lat ed lo cat ion -ba se d Sco pe 2 em issi ons u sing t he Int ern atio nal En erg y Age nc y (IE A) ca rbo n emis sio n fac tor s for e lec tr icit y. 4 In clu des s cal ed dat a for e lec tr icit y, gas , die sel u sed i n gene rat ors a nd dis tr ict h eat ing co nsum pti on in th e UK . We have r epo r ted o n all th e emis sio n sour ce s wit hin our t ota l car bon f oot pri nt whi ch inc lud es Sc ope 1, 2 an d 3 (fal ling w ith in our G roup ﬁ nan cial s tate men ts) in li ne wi th th e UK Co mpan ies A ct 20 06 (St rat egi c Repo rt a nd Di rec tor s Rep or ts) Re gul ati ons 2013. Sources of Scope 3 emissions Thousand tonnes of CO 2 e  Contributions to Scope 3 (%)  Purchased goods and services 357.4 72% Business trav el 49.1  10% Capital goods 31.2 6% Employee commuting 24.6 5% Upstream leased assets 17.5 4% Fuel -and-energy -related activities  6.2 1% Waste gener ated in operations 5.2 1% Investments 4.3 1% 1 B ase line d ata c orr esp ond s to F Y1 9 . 2 B usin ess t rav el: F or gre ate r accu rac y, air tr ave l emis sio ns wer e cal cul ate d usin g the in div idua l ﬂigh t and s eat cl as ses , ra ther t han th e roun d tr ip mile age . It al so in clu des a ll oth er t ype s of tr ave l - rail , ta xi, g rey ﬂ eet , pub lic tr ans por t , and in dire ct e miss ion s fro m overnight accommodation. 3 N ot inc lude d in Sc op e 2. Our carbon footprint F ull Scope 3 emissions analy sis (estimated base on FY19 baseline) T otal Scope 3 (FY19) = 495.34 thousand tonnes of CO 2 e T op 4 sources of c ontrolled Scope 3 emissions Purchased goods and services Business travel Upstream leased assets (including cloud, outsour ced servers) Fuel -and-energy-r elated activities (or Well - T o- T ank) America. W e are also developing a global strategy for r educing emissions from data storage at our on-site data centr es, as well as from external sites or cloud-based solutions. While the move to homeworking this year hasreduced our oper ational emissions, werecognise ther e is a knock -on eect in increased ener gy use in employees’ homes. Wear e exploring how to account for this in ourScope 3 reporting in futur e and we have engaged colleagues to help them reduce environmental impacts at home (see below). Engaging employees to reduce environmentalimpacts We encour age employees to use virtual meeting alternatives to minimise tra vel, and this year there was a big r eduction in business tra vel and related emissions due to COVID-19 r estrictions. We also ask ed employees to keep thinking about the environment and r educing their footprint even when they are working fr om home. Our Little Gr een Steps campaign in Asia Paciﬁc helped colleagues avoid an estimated 318kg of carbon emissions. Last year , we committed to eliminating as muchsingle-use plastic in Experian-controlled facilities as possible within two years. With hardly any one working in our facilities this year , we have postponed action on this target, but our commitment still stands. In the coming y ear , we will assess how the new ﬂexible working policy and patterns impact the amount of single-use plastic usage in our facilities to establish a baseline, and fr om there plan to establish aquantiﬁable target for its maximum feasiblereduction Investing in high-quality osetting Last year , we committed to oset our Scope 1 and 2 emissions gradually o ver the ﬁve years to 2025. Accor dingly , we will oset 20% of these emissions for FY21. We aim to invest in osetting projects that not only r educe carbon, but bring added value to communities to enhance our contribution to the United NationsSDGs. 57 Experian plc Annual Report 2021 Strategic report We re por t in li ne with the Non- Fin anci al R epor ti ng requi remen t as detai led in Sections 4 1 4CA and 4 1 4CB of the UK Compa nies Act2006. Our aims Our business model is set out on pages 20 to 25. W e believe data can cr eate a better tomorrow for every one, tr ansforming lives and societies, making cr edit lending simpler , faster and more eective, and helping businesses to become more ecient, with faster and more convenient service delivery to consumers. Non-ﬁnancial risks The Risk management section of the Strategic report, starting on page 72, sets out the Group’s approach to identifying and managing our principal risks and uncertainties. Our Thr ee Lines of Defence model provides a rigor ous governance fr amework, and the list of principal risks starting on page 75 gives details of the policies, outcomes and due diligence pr ocesses that control and mitigate those risk s. The key areas wher e non-ﬁnancial adverse impacts could arise are: 1. R espect for human rights As data custodians, we hav e a responsibility to safeguard consumer priv acy , and we continue to systematically educ ate our people on how to handle sensitive data through our SecurityFirst progr amme. Our Global Code of Conduct  aligns with the United Nations Universal Declar ation of Human Rights, and our commitment to ensuring an ethical supply chain  is borne out by our membership of the Slave-F ree Alliance. 2. Employees Employee engagement is a key performance indicator (see page 17), and we talk on pages 49 to 50 about our many progr ammes and initiatives that inspire our people to be their best, to bring their whole selves to work, our commitment to diversity , equity and inclusion, and our recruitment, retention and succession practices that help to mitigate the risk of our dependence on highly skilled personnel. 3. Envir onmental matters 1 We tak e our environmental r esponsibilities seriously , and the r eduction of greenhouse gas emissions is a key performance indicator f or us (see page 17). See also page 53 for further actions and initiatives Experian is taking to help protect the envir onment 2 . 4. Anti-corruption and anti-bribery Our Anti-Corruption Fr amework 1 sets out our zero-toler ance policy on bribery and corruption in any form, and this message is reinfor ced through mandatory annual tr aining for employees. 5. Social matters Experian has many initiatives in place to deliver our purpose of creating a better tomorrow for consumer s, businesses, our people and our communities. The role we play beneﬁts everyone: businesses grow , people prosper and communities thrive. This happens in many ways, including through our core business, the development of Social Innov ation products, employee volunteering and support for community groups and charities. Section 172 matters Speciﬁc examples Page Section 172 legislation, which bec ame eective in the UK during FY20, aims to help shareholders better under stand how directors have discharged their duty to pr omote the success of companies, while having r egard to the matters set out in Section 172(1)(a) to (f) of the UK Companies Act 2006 (s172 matters). In addition, the 2018 UK Corpor ate Governance Code recommends that boar ds describe how the matters set out in Section 172 have been considered in Boar d discussions and decision-making. Section 172 deﬁnes the duties of company directors and concerns the duty to pr omote the success of companies. Throughout FY21, the directors of the Compan y continued to exercise these duties while having r egard to the s172 matters, and also to other relevant factors as they reviewed and consider ed proposals fr om senior management, and as they governed the Company on behalf of its shareholders thr ough the Board and its committees. Experian plc, a Jer sey-incorpor ated company , and the Board embr ace Section 172 and fully support its aims, and we ar e reporting in line with the UK requir ement. We outline below , through use of cr oss refer ence, where we have consider ed the s172 matters throughout this Annual R eport. 1 M ore d etai l is ava ilab le at w w w.ex per ianp lc. com/r esp ons ibil it y /our-p ol icie s. 2 Furth er detail is also available at ww w.experianplc.com/resp onsibility/ data-and-a ssurance. (a) The likely consequences of any decision in the long term Our dividend policy , taken together with sections of our Financial r eview , explains how we balance returns to shar eholders with capital in vested organic ally and on acquisitions Our governance framework sho ws how the Board delegates its authority 62 93 (b) The interests of the compan y’s employees Our purpose in action - COVID-19 response Employee engagement 10 17, 2 4 (c) The need to foster the company’s business relationships with suppliers, customers and others Partnering with suppliers We comply with the r equirements of ‘The Reporting on Payment Pr actices and Performance Regulations (2017)’ for all of our in-scope UKcompanies 2 5, 51 (d) The impact of the company’s oper ations on the community and the environment Improving ﬁnancial lives Protecting the envir onment 30 53 (e) The desirability of the compan y maintaining a reputation for high standar ds of business Upholding high ethical standards Partnering with suppliers 51 2 5, 51 ( f) The need to act fairly between members of the company Stakeholder engagement Investment proposition 24 94 , 9 5 Non-ﬁnancial information and s172(1) statement Section 1 72 Experian plc Strategic r eport 58 Regional r eview North Americ a North America was r esilient despite challenging external market conditions. Our strategic investments in innovation and our pur suit ofnew business opportunities have been successful. We made good pr ogress with Ascend, our str ategy to grow in specialised verticals like Health, and through expansion ofour Consumer Services business. Craig Boundy CEO, North America Revenue b y activity 2021 US$m 2020 US$m T otal growth % Organic growth % B2B: Data 1,761 1,642 7 5 B2B: Decisioning 694 679 2 2 T otal B2B 2,455 2,321 6 4 Consumer Services 1,075 926 16 16 T otal North America 3,530 3,247 9 7 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % 9 11 11 8 7 Total revenue growth 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % 7 11 10 6 5 Organic revenue growth A . B2B: Data 50% B. B2B: D ecisio ning 20% C. C onsume r Ser vic es 30% A B C Revenue split 202 1 2 0 20 2 0 1 8 1 2 0 1 9 2 0 1 7 Margin % US$m 34.0 33.7 32.3 31.4 31.8 1,201 1,093 940 821 779 Benchmark EBIT and Benchmark EBIT margin 1 Re st ated f or IF RS 15. Revenue in North America was US$3,530m, with total revenue gr owth of 9% and organic revenue gr owth of 7%. The dierence r elated to the acquisitions of T apad and Corpor ate Cost Control and other smaller acquisitions. North America was very r esilient in the face of the marketplace challenges. While we wer e able to rely on some support fr om counter- cyclical r evenue streams, we beneﬁtted equally , if not more, from our in vestments in innovation, our brand and fr om the progress we have made in developing new business opportunities. The B2B segment delivered or ganic revenue growth of 4%. Mortgage volumes were robust as historically low inter est rates led to higher consumer reﬁnancing activity . W e secured new and expanded client relationships for Experian Ascend, with str ong demand for our data services, mark eting and account management modules as well as ﬁrst-time contributions from newer modules like Ascend Intelligence Services. In k eeping with our ambition to make credit and lending simpler , we also made good progr ess towards developing our suite of veriﬁcation services oers, and after the year-end secur ed important new client wins. Growth in these ar eas oset signiﬁcantly reduced volumes in r elation to unsecured lending, and lower softwar e revenue, as well as lower revenues fr om retail clients as they reduced marketing expenditur e. We made further pr ogress in our strategy to grow in specialised vertic als. Health deliver ed a very solid performance. We have expanded the range of services we oer to our hospital clients to help them manage their revenue cycle and we are steadily incr easing our presence in new customer segments such as the payer sector and pharmacies. Our recent investments, designed to enhance the consumer experience through digital channels, have pro ved well timed. W e saw strong tr action for these services as our hospital clients sought to provide healthc are in virtual settings. This also beneﬁtted authentication volumes as clients sought to verify patient identities. At the other end of the customer lifecycle, we saw good demand for solutions which provide revenue certainty for healthc are clients. Our automotive vertical, while volatile through theyear , was also r elatively resilient. Empowering ﬁnancial lives is an important aspect of what we do at Experian and we delivered one of our str ongest years ever for Consumer Services with organic r evenue growth of 16%. This was fuelled by new memberships and product innov ation. Experian Boost has proved to be an innov ative new product to help consumers to manage their ﬁnances, with 6.7m connected accounts. Brand investment through our ‘purple cow’ adv ertising campaign has yielded consider able growth in free memberships which totalled 41m at the year-end, up from 30m free members at the end of FY20. W e continue to diversify our business model. W e have successfully entered into automotive insurance matching, which supplemented growth fr om subscription-based credit educ ation services and credit matching referr al fees. Our credit matching lending panel added more lending partners who ar e attracted to our platform because we ar e able to deliver alarge audience and bec ause of our ability to match consumers with suitable credit oer s. We enhanced Experian Boost and now consumers can contribute payment history data from str eaming services (including Netﬂix) to their credit scor es as an eligible tradeline, and we continue to invest in a new breed of smart services to help consumers manage their ﬁnancial health. The strength in our r evenue performance contributed to strong EBIT pr ogression, up 10% to US$1,201m. The Benchmark EBIT margin increased by 30 basis points year -on-year to 34.0%, even as we in vested in customer acquisition in support of Consumer Services. 59 Experian plc Annual Report 2021 Strategic report A . B2B: Data 73% B. B2B: D ecisio ning 15 % C. C onsume r Ser vic es 12 % Latin Americ a V aldemir Bertolo CEO, Brazil Revenue b y activity 2021 US$m 2020 3 US$m T otal growth 2 % Organic growth 2 % B2B: Data 457 578 1 1 B2B: Decisioning 92 114 2 2 T otal B2B 549 692 1 1 Consumer Services 76 40 144 144 T otal Latin America 625 732 9 9 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % 9 13 6 6 9 Total revenue growth 2 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % 9 13 6 6 9 Organic revenue growth 202 1 2 0 20 2 0 1 8 1 2 0 1 9 2 0 1 7 Margin % US$m 30.1 32.7 33.3 220 27.5 172 231 259 34.4 251 Benchmark EBIT and Benchmark EBIT margin A B C Revenue split We continue to execute on our str ategy to be the undisputed leader for negative and positive data in Brazil and to addr ess new market needs with our innovative platforms. We signed new multi-year , multi-solution agreements with ourlargest clients and secur ed a number ofnew clients. Consumer Services goes fromstr ength to strength. Revenue in Latin America was US$625m, with both total and organic r evenue growth of 9% atconstant exchange rates. Organic revenue growth in Br azil was 11%. B2B organic r evenue grew 1%. Strength in Serasa Automotive and Decisioning in Br azil oset weakness in traditional cr edit bureau volumes across Br azil and other markets in Latin America. In Brazil, we made good progress despite the challenging backdrop, signing new multi-year , multi-solution agreements with our lar gest clients, with incr eased share of wallet. We ar e also driving widespread adoption of positive data propositions which is leading to volume growth in enquiries. We expect to sustain this trajectory with the intr oduction of a range of 1 Re st ated f or IF RS 15. 2 At c ons tan t exch ange r ate s. 3 Re venu e for F Y2 0 has b een r e- pre sen ted f or the re cla ssi ﬁca tion o f our C ons umer S er vi ces b usin es s to the Consumer Ser vices business segment. enhanced propositions in FY22, and we intend to make all new scores and attributes a vailable through our Ascend technology platform. Across the r egion, we signed 12 new clients inthe year for Experian Ascend and plan to introduce new modules in the coming months. We had good gr owth in fraud and identity management, which included new wins for ourCrossCor e platform, all of which contributed to a solid year for Decisioning. Nowhere perhaps better illustr ates our commitment to empower consumers than the progr ess we have made in Br azil. Consumer Services delivered another year of outstanding performance, with or ganic revenue growth of 144%. W e have established a model, unique in Brazil, where we can provide consumer s with ﬁnancial information, help people to better understand their credit scor es, compare pricing and apply for credit oer s, as well as oering identity monitoring subscription services. Consumers can also use our collections marketplace to pay their bills and even to see the impact of these bill payments in improved credit scor es through our fr ee Score T urbo oer . As a r esult, we ha ve grown our fr ee membership base to 59m, compared to 45m inFY20. Audiences of this size and sc ale have attracted new lender s to our platform, including a growing pr oportion of the emerging FinT ech community in Brazil. Our team in Brazil is committed to innovation-led gr owth and we areexcited by the opportunities that lie ahead. In January , we wer e subject to media speculation claiming that Serasa mark eting data was part of data from multiple organisations illegally oer ed for sale on the dark web. W e take our responsibilities to pr otect consumer data extremely seriously and we initiated an extensive and detailed review which was conducted over sever al months and supported by multiple third-party experts. This investigation has found no evidence that any of our systems have been compr omised. We have provided our conclusions and the detailed results of our investigation to the r elevant authorities, including the F ederal authorities who continue to pursue a criminal investigation against the individuals involved. Performance in Spanish Latin America was weaker as parts of the region ha ve been especially hard hit by the CO VID-19 pandemic. We ha ve placed a strong focus on oper ating eciency , while sustaining new pr oduct investment and undertaking technology transformation. More recently , we have seen evidence of recovery which will help us to resume our str ategic ambitions to diversify ourtraditional bur eau oerings and focus ondeveloping new opportunities such as services to consumers. Benchmark EBIT in Latin America was US$172m, up 4% at constant exchange r ates. The Benchmark EBIT margin fr om ongoing activities at actual exchange rates w as 27.5% (2020: 30.1%) mainly reﬂecting r evenue mix eects. Experian plc Strategic r eport 60 UK and Ir eland Revenue b y activity 2021 US$m 2020 3 US$m T otal growth 2 % Organic growth 2 % B2B: Data 361 367 (5) (5) B2B: Decisioning 220 227 (7) (7) T otal B2B 581 594 (6) (6) Consumer Services 156 161 (6) (6) T otal – ongoing activities 737 755 (6) (6) Exited activities 12 14 T otal UK and Ireland 749 769 Jose Luiz Rossi Managing Director , UK and Ireland 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % (6) (2) 4 1 1 Total revenue growth 2 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % (6) (2) 4 0 1 Organic revenue growth 202 1 2 0 2 0 3 2 0 1 8 1 2 0 1 9 2 0 1 7 Margin % US$m 16.6 22.9 28.3 29.8 30.5 122 173 230 235 246 Benchmark EBIT and Benchmark EBIT margin Revenue split A . B2B: Dat a 49% B. B2B: De cisionin g 30% C. Co nsumer S er vice s 21% A B C We ha ve made good progr ess with our transformation pr ogramme in the UK and Ireland. Our ambition in the region is to simplify and modernise our technology estate and resume pr oﬁtable growth. We r eturned to growth in Q4 and deliver ed much-impro ved margin performance in H2 compar ed to H1. Wear e well positioned to take advantage of themany opportunities which lie ahead. Revenue from ongoing activities in the UK and Ireland was US$737m. T otal and organic revenue declined (6)% at constant exchange rates. Both B2B and Consumer Services organic revenue declined (6)%. This was a year of tr ansformation in the UK and Ireland and we made a lot of pr ogress. While we have more to accomplish, it was encouraging to see the region r eturn to growth in Q4 and deliver much-improved mar gin performance in H2 compared to H1. Our ambition in the region is to simplify and modernise our technology estate and resume pr oﬁtable growth, as well as to take advantage of the many opportunities which lie ahead. W e already see tangible evidence of progr ess in the form of much- improved client net pr omoter scores, higher employee engagement levels, greater network stability , and a r obust new business performance. B2B revenue fr om ongoing activities declined (6)% at constant exchange rates. Revenues were down for much of the y ear due to reductions in UK bank consumer lending and reduced demand for softwar e investment. Our marketing services segment was also aected by reduced marketing e xpenditure. W e successfully pivoted towards CO VID-19 support propositions, including government loan schemes, and as a r esult business credit volumes remained r obust. Negative tr ends reversed to some extent to wards the end of our ﬁnancial year with strengthening tr ansaction volumes as lenders reactiv ate progr ammes. The new business pipeline has also been encouragingly str ong, setting us up well for FY22. In particular , there is good demand f or our open data solutions such as aordability and categorisation, and for our identity and fraud management pr opositions, including CrossCor e, and ther e have been new wins for Experian Ascend. W e also added many new logos in the mid-market. While Consumer Services also had a dicult year , with or ganic revenue down (6)%, we took the important step to launch Experian Boost in the UK and this has made a promising start. The constraints on cr edit supply in the early part of the year also impacted revenues in our credit comparison marketplace. However , there was an improvement in the tr ajectory as the year progr essed and we exited the year with growth in Q4. Our free membership base grew to 9.5m consumers, compared to 7.5m last year , with 370,000 active Experian Boost memberships. Revenue reductions and the impact of our transformation pr ogramme aected our EBIT performance. Benchmark EBIT from ongoing activities was US$122m, down fr om US$173m the year before. The Benchmark EBIT margin from ongoing activities was 16.6% (2020: 22.9)%. With the tr ansformation progr amme now well progr essed, we expect a strong improvement in the UK mar gin in the yearahead. 1 Re st ated f or IF RS 15. 2 At c ons tan t exch ange r ate s. 3 Re venu e and B enc hmar k EBI T fo r FY 20 hav e bee n re -p res ente d for t he re cl assi ﬁc atio n to ex ited b usi nes s ac tiv iti es of c er tain B 2B bus ine sse s. 61 Experian plc Annual Report 2021 Strategic report EMEA/Asia P aciﬁc Ben Elliott CEO, Asia Paciﬁc Revenue b y activity 2021 US$m 2020 3 US$m T otal growth 2 % Organic growth 2 % B2B: Data 287 213 32 (8) B2B: Decisioning 178 214 (18) (20) T otal – ongoing activities 465 427 7 (14) Exited activities 3 4 T otal EMEA/ Asia Paciﬁc 468 431 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % 7 7 14 11 9 Total revenue growth 2 202 1 2 0 20 2 0 1 8 2 0 1 9 2 0 1 7 % (14) (3) 14 11 9 Organic revenue growth 202 1 2 0 2 0 3 2 0 1 8 1 2 0 1 9 2 0 1 7 Margin % US$m (4.3) 2.8 0.7 1.3 (0.9) (20) 12 3 5 (3) Benchmark EBIT and Benchmark EBIT margin Revenue split A . B2B: Dat a 62% B. B2B: De cisionin g 38% A B Our ambition in EMEA/Asia Paciﬁc is to concentrate our eorts wher e we can establish a strong market pr esence and can operate at scale. W e are pleased with the performance of our recent bur eau acquisitions in Germany and Spain, which ar e opening up new opportunities for us to pursue across the r egion. In EMEA/Asia Paciﬁc, revenue fr om ongoing activities was US$465m, with total r evenue growth at constant exchange r ates of 7% and an organic decline of (14)%. The dier ence principally relates to the contribution fr om ourbureau acquisitions: Compusc an, the Risk Management division of Arvato Financial Solutions, and Axesor . Our ambition in EMEA/Asia Paciﬁc is to concentrate our eorts wher e we can establish a strong market pr esence and can operate at scale. The COVID-19 pandemic has opened up some speciﬁc opportunities as many of our clients are acceler ating their adoption of cloud-based technologies. W e are r apidly introducing our global advanced B2B propositions, including Ascend, SaaS decisioning through PowerCurve, our open datasolutions, and fr aud and identity services. Revenue performance last year was signiﬁc antly impacted by reduced bur eau volumes, particularly during the initial phases of lockdown. The trajectory gr adually improved as lockdowns eased in most markets but remained challenged in countries hardest hit by the pandemic, such as India. Clients wer e also hesitant to spend on software implementations, delaying or cancelling decisions, which particularly aected Asia P aciﬁc. Client activity has picked up in recent months, particularly in EMEA. We ha ve got o to a strong start in our two new bureau acquisitions in Germany and Spain, both of which have performed well in the period since acquisition. All our global platforms ha ve already been intr oduced and made available inGermany . In Spain, we now have two highly complementary bureau businesses, the integration of which is pr oceeding well , and we are exploring way s to fully address the new opportunity we have in the small and medium enterprise (SME) market. The reduction in r evenue aected our EBIT performance. Benchmark EBIT from ongoing activities was US$(20)m (2020: US$12m) and the Benchmark EBIT margin fr om ongoing activities was (4.3)% (2020: 2.8%). 1 Re st ated f or IF RS 15. 2 At c ons tan t exch ange r ate s. 3 Re venu e and B enc hmar k EBI T fo r FY 20 hav e bee n re -p res ente d for t he re cl assi ﬁc atio n to ex ited b usi nes s ac tiv iti es of c er tain B 2B bus ine sse s. Experian plc Strategic r eport 62 Financial review Resilience and a str ong r ecovery Summary Our focus this year has been to protect and support our people, clients and consumer s. We ha ve supported governments, businesses and communities during the pandemic through our data insights. We quickly tr ansitioned the majority of our employees to work from home. We intr oduced ﬂexible working and increased collabor ation tools and support networks, such as mindfulness progr ammes, to help our people navigate the challenges of home working. Webinar s and senior leadership vlogs helped us connect. Our employ ees around the world have shown incredible r esilience, commitment and ﬂexibility during the COVID-19 pandemic and this is reﬂected in our r esults. We maintained oper ational capacity throughout the pandemic, and ar e in a strong ﬁnancial position, with access to substantial funding, ready to take adv antage of the global pandemic recovery as it builds. Revenue US$ 5. 4 bn Benchmark EPS USc 1 0 3 .1 Basic EPS USc 8 8.2 T otal revenue from ongoing activities growth 7 % (at constant FX) Cash ﬂow conver sion 10 6 % Organic r evenue growth 4 % (at constant FX) Ordinary dividends US$ 4 27 m Lloyd Pitchford Chief Financial Ocer Statutory ﬁnancial highlights 2021 US$m 2020 US$m Growth % Revenue 5,372 5,179 4 Operating pr oﬁt 1,183 1,185 – Proﬁt befor e tax 1,077 942 14 Proﬁt after tax fr om continuing operations 802 679 18 Net cash inﬂow fr om operating activities – continuing operations 1,488 1,262 18 Full -year dividend pershare USc47.0 USc47.0 – Basic EPS USc88.2 USc74.8 18 Benchmark ﬁnancial highlights 1 2021 US$m 2020 2 US$m Constant rates growth % Revenue 3 5,357 5,161 7 Benchmark EBIT 1,386 1,387 3 Benchmark PBT 1,265 1,255 5 Benchmark operating c ash ﬂow 1,476 1,214 24 Undrawn committed bank facilities 2,650 2,175 n/a Benchmark EPS USc103.1 USc103.0 4 1 See note 6 to the Group ﬁnancial statements for deﬁnitions of non-GAAP measures. 2 Results for FY20 are re-pr esented for the reclassiﬁcation to exited business activities of certain B2B businesses. 3 From ongoing activities. Alternative Perf ormance Measur es We ha ve identiﬁed and deﬁned certain non-GAAP measur es. These are the key measures management uses to assess the underlying performance of our ongoing businesses. There is a summary of these measures on page 71 and a fuller explanation in note 6 to the Group ﬁnancial statements on pages 160 to 161. Highlights 2021 Aga inst the back drop of the g loba l pandemic we delivered a stro ng per for mance, growing tot al revenu e  7% a t constan t exc h ang e rat es. W e generate d US$ 1 . 5bn of c ash with Benchmark operating c ash ﬂow up 22%. W e ha ve focused o n su ppor ti ng ou r pe ople, clients and consumers throug hout the COVID- 1 9 pandemic, us in g da ta asa forc e for g ood, help ing to navi gate the cr isis. 63 Experian plc Annual Report 2021 Strategic report Performanc e summary Commentary on revenue and Benchmark EBIT performance by region is pr ovided earlier in the Strategic r eport , within the regional reviews on pages 58 to 61. We r eport our ﬁnancial results in US dollars. The weakening of our other tr ading currencies during the year , primarily the Br azilian real against the US dollar , r educed total revenue by US$141m and Benchmark EBIT by US$56m. A± 1% change in the Brazilian r eal or pound sterling exchange rate would impact total revenue by ± US$5m or ± US$8m r espectively . Benchmark EBIT from ongoing activities w as US$1,385m (2020: US$ 1,386m), gr owing at 3% at constant currency , ﬂat at actual exchange rates. Benchmark EBIT margin from ongoing activities was 25.9% (2020: 26.9%), and was adversely impacted by for eign exchange movements by 20 basis points. Details of the principal exchange rates used and currency exposur es are pr ovided in note 10 to the Group ﬁnancial statements on page 169. Rev enue, Pr oﬁt before tax and Benchmark EBIT mar gin by business segment 2021 US$m 2020 2 US$m T otal growth 1 % Organic gr owth 1 % Revenue Data 2,866 2,800 6 2 Decisioning 1,184 1,234 (3) (4) Business-to-Business 4,050 4,034 3 – Consumer Services 1,307 1,127 17 17 Ongoing activities 5,357 5,161 7 4 Exited business activities 15 18 n/a T otal 5,372 5,179 6 Benchmark EBIT Business-to-Business 1,192 1,251 (1) Consumer Services 283 247 14 Business segments 1,475 1,498 2 Central Activities – centr al corporate costs (90) (112) n/a Ongoing activities 1,385 1,386 3 Exited business activities 1 1 n/a T otal Benchmark EBIT 1,386 1,387 3 Net interest and non-benchmark items (309) (445) n/a Proﬁt before tax 1,077 942 6 Benchmark EBIT margin – ongoing activities Business-to-Business 29.4% 31.0% Consumer Services 21.7% 21.9% T otal Benchmark EBIT margin  25.9% 26.9% 1 At constant exchange rates. 2 Revenue and Benchmark EBIT for FY20 are re-pr esented for the reclassiﬁc ation to exited business activities of certain B2B businesses and the reclassiﬁcation of our Consumer Services business in Latin America to the Consumer Services business segment. F urther information is provided in note 9 (b) to the Gr oup ﬁnancial statements. 3 Benchmark EBIT margin for ongoing activities is calculated by dividing Benchmark EBIT for ongoing activities by r evenue from ongoing activities. 2021 2020 2018 2 2019 2017 US$m 5,372 5,179 4,861 4,584 4,335 R ev e n ue 2021 2020 2018 2 2019 2017 USc 103.1 103.0 98.0 94.4 88.4 B e nc hm ar k E PS 2021 2020 1 2018 2 2019 2017 Ma rgi n % US $m 25.9 26.9 26.9 27.1 27.6 1,386 1,387 1,311 1,247 1,199 T ot a l Be nc hm a rk E BIT a nd B enc hm ar k E BI T m a r gi n 2021 2020 2018 2019 2017 USc 47.00 47.00 46.50 44.75 41.50 Div id en d pe r sh ar e 1 Results for FY20 are re-pr esented for the reclassiﬁcation to exited business activities of certain B2B businesses. 2 Results for 2018 are restated for IFRS 15. Experian plc Strategic r eport 64 COVID-19 pandemic Business resilienc e Since its listing in 2006, Experian has consistently grown its or ganic revenue. As we reﬂect on our history , in the most signiﬁcant ﬁnancial crises of the last 15 years – the COVID-19 pandemic and the global ﬁnancial crash of 2008 – we ha ve maintained that positive trajectory . This year we experienced a downwar d trend in Q1 as the COVID-19 pandemic unfolded and global economic activity faltered. W e saw signiﬁcantly r educed volumes in relation to unsecured lending acr oss the globe with regional volumes down in the quarter by approximatel y 30%. As the year pr ogressed volumes recover ed and we returned to growth in Q2, with quarterly total r evenue growth thereafter near pr e-COVID-19 levels and even accelerating in our Consumer Services business. We attribute this r esilience to a variety of factors: our portfolio diversity , a strong innovation pipeline, our strategic in vestments, aspects of our business being counter-cyclic al, and diversiﬁcation of our mark ets by expanding into new verticals, such as US automotive insurance. The COVID-19 pandemic has requir ed us to adapt. We quickl y transitioned our business with the majority of our employees working from home, increasing security and collaboration tools to pr ovide a seamless service to clients. We ha ve continued innovation and pr oduct investment throughout the period, to sustain performance. We also acted quickly to support go vernments, businesses and communities during the pandemic through our data insights, helping to ensure ﬁnancial support r eached the people and businesses who needed it most. While the pandemic has inevitably had a detrimental impact on some aspects of our business, mark et trends have been c atalysed by the global crisis, pr oviding new opportunities for expansion in others. Ther e has been accelerated gr owth in the fraud management market, increased r eliance on data and analytics and accelerated in vestment in digital platforms. We ar e ready to take advantage of the global pandemic recovery as it builds. 1 From ongoing activities at constant exchange r ates. -2% 0% 2% 4% 6% 8% 10% 12% Total revenue growth 1 FY 1 9 10% 9% 9% 10% Q1 Q2 Q3 Q4 FY 20 Q1 Q2 Q3 Q4 FY 21 Q1 Q2 Q3 Q4 7% 9% 9% 11% -1% 7% 10% 9% -5% 0% 5% 10% 15% Business-to-Business organic revenue growth 1 FY 1 9 9% 9% 8% 11% Q1 Q2 Q3 Q4 FY 20 Q1 Q2 Q3 Q4 FY 21 Q1 Q2 Q3 Q4 6% 6% 7% 9% -5% 1% 2% 1% -2% 0% 2% 4% 6% 8% 10% 12% Total organic revenue growth 1 FY 1 9 8% 8% 9% 10% Q1 Q2 Q3 Q4 FY 20 Q1 Q2 Q3 Q4 FY 21 Q1 Q2 Q3 Q4 6% 7% 7% 10% -2% 5% 7% 5% 0% 5% 10% 15% 20% 25% Consumer Services organic revenue growth 1 FY 1 9 5% 5% 10% 6% Q1 Q2 Q3 Q4 FY 20 Q1 Q2 Q3 Q4 FY 21 Q1 Q2 Q3 Q4 8% 14% 6% 11% 8% 17% 22% 22% Financial review continued 65 Experian plc Annual Report 2021 Strategic report Business-to-Business growth has been driven by ongoing strength in counter -cyclical r evenue streams, such as US mortgage, less susceptible to economic downturns. We delivered expansion in key verticals and str engthened our position in employment and veriﬁcation services. W e have continued the roll -out of our Ascend platform across further territories. These factors oset ongoing COVID-19 r elated weakness in credit r eference volumes. While bureaux volumes ar e down year -on-year we saw improving tr ends as the year progressed and credit supply impr oved. In Decisioning, performance in health and fr aud management was strong, though software delivery , particularly of on-pr emise solutions, has been hit by COVID-19. In Brazil we beneﬁtted from incr eased contributions from positive data propositions and signed new multi-year agr eements with our largest ﬁnancial services clients. Strength in Consumer Services was supported by ongoing expansion of our free membership base. W e now have 110m consumer free memberships. Experian Boost is helping people instantly improve their cr edit scores. In the USA we now have 6.7m unique account connections. We ar e encouraged by consumer reaction since launching Boost in the UK in November 2020. Boost is also stimulating activity for credit comparison services and generating r eferral fees. There was heightened consumer inter est leading to good demand in credit educ ation and identity monitoring services. W e delivered considerable gr owth in Consumer Services in Latin America, with revenue up 144% at constant exchange rates, reﬂecting transaction growth in eCr ed credit matching and str ength in our debt resolution service. We will continue to in vest in propositions which help those who are curr ently unbanked gain access to aordable cr edit and wider ﬁnancial services. We anticipate that str ong growth will continue in FY22 as the global economy recov ers, with projected high single-digit or ganic revenue growth for the y ear as a whole. % A Financial services 38 B Direct-to-consumer 17 C Health 7 D Retail 5 E Software and Pr ofessional services 5 F Automotive 4 G Insurance 4 H T elecoms and Utilities 4 I Media and T echnology 3 J Gove rnme nt and Pub lic Se cto r 3 K Other 10 A B C D K F G H I J E F Y2 1 Revenue by custom er  Historic organic revenue growth performance 1 (at constant FX) 8% 4% 3% 2% 8% 10% 8% 5% 1% 5% 5% 5% 9% 8% 4% 15% 10% 5% FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Global Financial Crisis COVID-19 pandemic 1 Revenue from ongoing activities. 1 Ongoing activities. Experian plc Strategic r eport 66 Financial review continued Free member base million FY 1 8 40 FY 1 9 5 7 FY2 0 FY2 1 8 2 110 FY 1 7 2 2 USA Br az il UK Global cost proﬁle % IT 8 Data 17 Marketing Other 10 12 Labour 51 Central Activities 2 New and scaling products revenue US$m FY 1 9 FY 1 8 F Y 20 FY2 1 FY 1 7 359 2 13 537 678 10 8 B2C pr oduc ts – Lead generation – ID Wor ks – Braz il co nsum er B2B pro duc ts – Power Cu r ve suite – As cend – Healt h new pr odu ct s – Auto new pr oduc ts – Cros sC ore Benchmark operating cash ﬂow US$m and cash ﬂow conversion % FY20 1,214 88% FY19 1,270 97% FY18 1 1,196 96% FY17 1,149 96% FY21 1,476 106% 1 Restated for IFRS 15. Cap ital expendi ture (capex ) as % o f t otal revenue Cap ital inve stme nt bre akdown % FY 1 9 FY 20 FY 21 FY 1 7 48% 32% 20% 45% 31% 24% 38% 34% 28% 36% 31% 33% 35% 25% 40% FY 1 8 FY 1 9 FY 20 FY 21 FY 1 7 FY 1 8 Data Infrastructure Development Ca pe x % 9 9 9 9 Ca pe x U S$ m 399 431 439 487 8 422 0 400 800 1, 2 0 0 1, 6 0 0 Use s of cas h Cash generated Fund s fr om Operations Organ ic capital inves tment Dividends Reduction in Net deb t and oth er Acquisitions and min ori ty inves tments Capital summary US$m * Funds from Operations is deﬁned as Benchmark fr ee cash ﬂow plus organic capital investment (c apital expenditure). 67 Experian plc Annual Report 2021 Strategic report Operating eciency Throughout the COVID-19 pandemic we ha ve maintained operational c apacity while taking a balanced approach to cost management. W e have not availed our selves of any government furlough schemes. While there has been increased amortisation and depr eciation reﬂecting pr evious investment in technology infrastructur e, we have made reductions in discretionary spend to combat this, freezing headcount and delaying non-critical investment. We ar e rationalising our oce footprint. Our Futur e of Work pr ogramme is a global initiative to create mor e modern, ﬂexible and collabor ative ways of working while simultaneously r educing costs. Employ ees will have more choice in the way they work and be able to work ﬂexibly , remotely or fr om oce hubs. We continue to in vest in growth, increasing marketing and customer acquisition expenditure, as we position ourselves to emerge str ongly from the pandemic. Cash and liquidity management This year , we continued to gener ate cash strongly , with a 106% (2020: 88%) conversion of Benchmark EBIT to Benchmark oper ating cash ﬂow , and Benchmark free c ash ﬂow of US$1,124m (2020: US$774m). The continued strength of our Benchmark oper ating cash ﬂow performance reﬂects the natur e of our business and ﬁnancial model, and our focus on working capital management. W e have successfully improved collections, recovering receivables that had increased towar ds the end of FY20 due to the impact of COVID-19. F unding During the year we issued two bonds of £400m each which mature in 2025 and 2032, extending the life of our longest debt by 25 months. We took advantage of prev ailing markets to secur e additional long-term funding for the Group and the latest issue was at a coupon rate of 0.739%. At 31 March 2021, 56% (2020: 43%) of our total borrowings falls due in over ﬁve y ears, and our undrawn committed bank borr owing facilities were US$2.7 bn (2020: US$2.2bn). We k eep our debt levels stable at a low multiple of our proﬁts. Net debt at 31 March 2021 was US$3,826m (2020: US$3,898m), 2.1 times Benchmark EBITDA and 2.2 times Benchmark EBITDA when measured on the fr ozen GAAP basis we use for our debt covenant. Our target range is 2.0 to 2.5 times. The covenant on our banking facilities requir es that Benchmark EBIT should cover net inter est expense before ﬁnancing fair v alue remeasur ements by three times. At 31 March 2021, this cover age ratio was 11 times (2020:11 times). W e have no undue concentr ation of repayment obligations in r espect of borrowings Cash ﬂow and Net debt summary 1 Y ear ended 31 March 2021 US$m 2020 US$m Benchmark EBIT 1,386 1,387 Amortisation and depreciation char ged to Benchmark EBIT 453 413 Benchmark EBITDA 1,839 1,800 Impairment of non-current assets char ged to Benchmark EBIT 6 – Net capital expenditur e (418) (483) Increase in working capital (13) (112) Principal lease payments (56) (55) Benchmark loss/(proﬁt) r etained in associates 12 (2) F air value gain on revaluation of step acquisition – (17) Charge for shar e incentive plans 106 83 Benchmark operating c ash ﬂow 1,476 1,214 Net interest paid (115) (152) T ax paid – continuing operations (236) (286) Dividends paid to non-controlling inter ests (1) (2) Benchmark free cash ﬂow 1,124 774 Acquisitions (583) (700) Purchase of investments (31) (95) Disposal of investments 151 – Movement in Exceptional and other non-benchmark items (67) (18) Ordinary dividends paid (427) (424) Net cash inﬂow/(outﬂow) – continuing oper ations 167 (463) Net debt at 1 April (3,898) (3,262) Net share pur chases 19 (188) Discontinued operations – (6) For eign exchange and other movements (114) 21 Net debt at 31 March (3,826) (3,898) 1 For Group cash ﬂow statement see page 151. Rec onciliation of net capital e xpenditure Y ear ended 31 March 2021 US$m 2020 US$m Capital expenditure as r eported in the Group c ash ﬂow statement 422 487 Disposal of property , plant and equipment (1) (5) (Loss)/proﬁt on disposals of ﬁxed assets (3) 1 Net capital expenditur e as reported in the cash ﬂow and Net debt summary 418 483 and did not breach this covenant given on borrowings during the year under r eview or theprior year . Disciplined capital management Our capital allocation fr amework is based on balancing a number of competing priorities – notably operating and c apital investment, dividends, acquisitions and shar e repur chases – while targeting Net debt within the r ange of 2.0 to 2.5 times Benchmark EBITDA. The mix between these categories will vary over time, and in FY21 we suspended our share repur chase progr amme due to uncertainties surrounding COVID-19. We assess acquisition opportunities against a range of metrics, including economic valuations and the earnings enhancement we expect them to bring relative to shar e repur chases. T otal investment of US$881m (2020: US$1,278m) comprised cash ﬂows for net c apital expenditure, acquisitions and net investments. The acquisition of our majority stake in the RiskManagement division of Arvato Financial Solutions was satisﬁed by 7.2m Experian plcshares. The chart opposite shows our capital summary as executed this year . Capital expenditur e Our capital expenditur e of US$422m (2020: US$487m) was 8% (2020: 9%) of revenue. The reduction was due to exchange and wher e we took a disciplined approach to prioritising investments. Digitisation and customer expectations of how we deliver data are incr easing. We continue to invest to drive innovation and bring the latest technologies to our clients, with emphasis on automation and tools to improve eciency , speed and eectiveness. Experian plc Strategic r eport 68 Financial review continued Our acquisition cash outﬂow was US$583m (2020: US$700m). W e completed a number of acquisitions in the year , including a 60% stak e in the Risk Management division of Arvato Financial Solutions for 7.2m Experian plc shares, which were v alued at US$253m on completion. We acquir ed the whole of the issued share capital of T apad, Inc. a leader in resolution of Acquisiti ons digital online identities, for US$290m. We also acquired the whole of the issued shar e capital of BrScan Pr ocessamento de Dados e T ecnologia Ltda (BrScan) for US$132m. Acquisitions were in the Business-to-Business segment and contributed US$117m to revenue and US$28m to Benchmark EBIT in the year , with annualised pro-forma r evenue of US$246m. We ha ve recognised a non-curr ent ﬁnancial liability of US$208m for put options in respect of acquisitions made this year . In April 2021, we completed two further acquisitions in the USA to bolster our income veriﬁcation business: T ax Credit Co., LL C and Employment T ax Servicing, LL C. Associat es and vent ure i nv estme nts We continue to in vest in smaller start-ups and FinT ech companies, to boost innov ation and advance our intellectual property . W e completed ten investments inour venture pr ogramme in FY21, bringing our total ventur e programme ﬁnancing to US$176m. During the year we disposed of our interest inFinicity Corporation, recognising a gain on disposal of US$120m, and in the y ear ahead weexpect to realise further gains. F ollowing a favour able trading performance wereversed the associate impairment char ge of US$23m booked in FY20. Associates Current invested capital Number of portfolio companies New deals closed this year US$128m 9 US$176m 25 10 – US$304m 34 10 V enture T otal Arvato Risk Management This investment expands our bureau pr esence in EMEA and extends our range of risk, anti-fraud and identity management services across Germany , Austria and Switzerland. Axesor businesses One of the largest independent business information bureaux in Spain, complementing our existing consumer information business. Corporate Cost Control A leading provider of workfor ce solutions in the USA expanding our veriﬁcation services oering. T apad A leading provider in digital identity resolution for mark eters helping to connect brands to consumer s, primarily in the USA. Brain Soluções de T ecnologia Digital The 55% investment enables us to expand our share of the Brazilian Agri cr edit market. BrScan A market leader in fr aud and identity solutions in Brazil. 69 Experian plc Annual Report 2021 Strategic report Interest Benchmark net ﬁnance costs decreased by US$11m reﬂecting a r eduction in market interest r ates and average borrowing levels. A reduction in for eign exchange losses on Brazilian r eal intra-Group funding of US$38m, and other fair value remeasur ements, contributed to the decrease in statutory net ﬁnance costs of US$130m. At 31 Mar ch 2021, interest on 91% of our net funding was at ﬁxed rates (2020: 67%). T axation Our total tax charge was US$275m (2020: US$263m) and our eective tax rate on Benchmark PBT was 25.9% (2020: 25.8%), reﬂecting the mix of pr oﬁts and prev ailing tax rates by territory . W e expect that our eective tax rate on Benchmark PBT in FY22 will be in the range of 26% to 27%. The equivalent cash tax r ate remains below our Benchmark tax rate and we pr ovide a reconciliation in the table opposite. Other dierences include an acceler ation of tax deductions as a result of US legislative changes in the year . W e anticipate that our cash tax r ate will increase and move closer to our Benchmark tax rate ov er the course of the next three year s, as tax amortisation of goodwill on earlier acquisitions and prior tax losses are utilised. Earnings per share Basic EPS was 88.2 US cents (2020: 74.8 US cents). Basic EPS was r educed by 14.9 US cents per share (2020: 28.2 US cents per shar e) in respect of discontinued oper ations, Exceptional items and other adjustments made to derive Benchmark PBT . Benchmark EPS was 103.1 US cents (2020: 103.0 US cents), an incr ease of 4% at constant exchange rates and ﬂat at actual r ates. A ± 10% change in the Brazilian r eal exchange rate would impact Benchmark EPS by ± 1 US cents. There would be no impact on Benchmark EPS from a similar change in the pound sterling exchange rate. We pr ovide further information in note 18 to the Group ﬁnancial statements onpage 175. Share c apital In FY21 we suspended our share r epurchase progr amme due to uncertainties surrounding COVID-19. During the year , the av erage number of shares in cir culation was 910m (2020: 902m) and the closing number of shares at 31 Mar ch 2021 was 914m (2020: 901m). The increase in the year is attributable to shares deliver ed as acquisition consideration and shar es issued on vesting of employee share incentiv e plans. 0 10 20 30 40 50 F Y21 F Y20 F Y 19 F Y 18 F Y 17 F Y 16 F Y 15 F Y 14 F Y 13 F Y 12 F Y 11 F Y 10 F Y09 FY0 8 FY07 Di vid end pe r sha re (US cent s) 32% 28% 3 1% 3 4% 40% 41% 41% 41% 41% 45% 47 % 4 6% 47 % 4 6% 4 6% Dividend history (USc) Payout ratio (%) 1 First interim dividend Second interim dividend Rec onciliation of Benchmark EBIT to statutory pr oﬁt befor e tax Y ear ended 31 March 2021 US$m 2020 1 US$m Benchmark EBIT from ongoing activities 1,385 1,386 Exited business activities 1 1 Benchmark EBIT 1,386 1,387 Net interest expense (121) (132) Benchmark PBT 1,265 1,255 Exceptional items 35 (35) Other adjustments made to derive Benchmark PBT (note 14(a)) (223) (278) Proﬁt before tax 1,077 942 1. Results for FY20 are r e-presented for the r eclassiﬁcation to exited business activities of certain B2B businesses. Cash tax rec onciliation Y ear ended 31 March 2021 % 2020 % T ax charge on Benchmark PBT 25.9 25.8 T ax relief on goodwill amortisation (2.6) (3.1) Beneﬁt of brought forwar d tax losses (2.0) (1.3) Other (2.6) 1.4 T ax paid as a percentage of Benchmark PBT 18.7 22.8 Dividends and distributable reserv es Our dividend policy aims to increase dividends, broadly in line with the underlying gr owth inBenchmark EPS over time. This aligns shareholder r eturns with our underlying proﬁtability . In the past ﬁve years we have r eturned over US$2bn to shareholders by dividend and o ver US$1.3bn via net share pur chases. We expect to ex ecute share pur chases of up to US$150m in the coming year , which will mainly oset deliveries under employee share plans. The Board has announced a second interim dividend of 32.5 (2020: 32.5) US cents per share, giving a total dividend for the year of 47.0 (2020: 47.0) US cents per share. The dividend in FY21 has been held level with the prior year in line with our policy . The total dividend per share for the year is covered 2.2 times (2020: 2.2times) by Benchmark EPS. Or dinary dividends paid in the year amounted to US$427m (2020: US$424m). Experian plc and the UK entity responsible for distributing dividends under the Group’s Income Access Share arr angements have signiﬁcant distributable reserves, which at 31 March 2021 were US$18.2bn and US$12.0bn r espectively . See note K to the Company ﬁnancial statements for further detail. 1 Payout ratio is dividend per shar e as a proportion of Benchmark EPS. Experian plc Strategic r eport 70 Financial review continued Net assets and ROCE summary Y ear ended 31 March 2021 US$m 2020 US$m 2019 US$m Goodwill 5,261 4,543 4,324 Other segment assets 3,756 3,344 2,957 T otal segment assets 9,017 7,887 7,281 Segment liabilities (2,043) (1,723) (1,541) Operating segments – net assets 6,974 6,164 5,740 Central Activities – net assets 388 307 300 Deduct: non-controlling inter ests (38) (6) (14) Capital employed 7,324 6,465 6,026 Net debt (3,826) (3,898) (3,275) Ta x (417) (292) (271) Add: non-controlling inter ests 38 6 14 Net assets 3,119 2,281 2,494 A ver age capital employed 6,849 6,383 6,094 ROCE 1 15.0% 16.1% 15.9% 1 For deﬁnition of ROCE see ‘Non-GAAP measures’ on page 161. For FY21 the r eturn used in the calculation of ROCE is based onBenchmark EBIT of US$1,386m and a Benchmark tax rate of25.9%. 2 Restated for IFRS 15. 202 1 2 0 20 2 0 1 8 2 2 0 1 9 2 0 1 7 % 15.0 16.1 15.9 15.5 15.5 ROCE Net assets and ROCE Operating segment net assets incr eased by US$810m in the year as a result of acquisitions. ROCE for the year ended 31 Mar ch 2021 reduced to 15.0% (2020: 16.1%) lar gely due to the eect of acquisitions completed part way through the year . ROCE is a post-tax measure and we use our Benchmark tax rate for ease of calculation. Financial risk management The key ﬁnancial risks speciﬁc to our business are set out in the Risk management section on pages 72 – 80. W e continue to monitor closely the impact of COVID-19 on our business and the global economy . Our priority r emains the health, safety and well-being of our employees, clients and consumers. While the UK’s departure fr om the EU has not had a signiﬁcant impact on our business, there is ongoing uncertainty related to Br exit and the longer-term eect on tr ade, cross-bor der data regulations and legislative arr angements. W e continue to monitor this risk. We ha ve identiﬁed unpredictable ﬁnancial markets or ﬁscal developments as a principal risk, including evolving tax la ws and the resolution of uncertainties r elating to prior- year tax liabilities. Detailed narr ative disclosures are contained in note 7 to the Group ﬁnancial statements on pages 161 – 162, with further numeric disclosures for for eign exchange, interest r ate and credit risk in notes 10, 15, 24 and 30 respectively . Critical estimates and judgments The Group is subject to a number of risk s and uncertainties which requir e us to make estimates and judgments. Ar eas involving signiﬁcant uncertainty ar e: Goodwill Goodwill repr esents 52% of total assets. W e test for impairment of goodwill at least annually by performing a value-in-use calculation for each cash-gener ating unit (CGU), which is based on c ash ﬂow projections with assumptions updated for the impacts ofCOVID-19. F ollowing our evaluation this year the carrying value of the Asia Paciﬁc CGU has been r educed to its recover able amount through recognition of a US$53m impairment charge. These estimates are, by nature, subject to uncertainty and the key assumptions used by each CGU, and sensitivities, are set out in note 20 to the Group ﬁnancial statements. Useful life of intangible assets Our business is subject to technological change and competition. We curr ently amortise non-acquisition intangibles over a period from thr ee to ten years, with the aver age life being ﬁve years. If the useful life of our databases and internal use/internally generated softwar e either increased or decr eased by one year , the impact on the annual amortisation charge would be a decrease of US$53m or an incr ease of US$76m respectively . We ha ve recognised an impairment char ge in the year of US$33m which largely r elates to an internally generated softwar e asset identiﬁed as requiring impairment due to the planned upgrade of our technology estate. T axation We ar e subject to tax in numerous jurisdictions and have a number of open tax returns with various tax authorities. It can take many year s to agree an outcome with a tax authority , as ther e are tr ansactions in the ordinary course of business for which the ultimate tax determination is uncertain. Our key uncertainties relate to the deductibility of purchased goodwill, inter-compan y trading and ﬁnancing. US$350m (2020: US$327m) is included in current tax liabilities in r elation to these judgmental areas. If the resolution of all these uncertainties was ultimately adverse, we may be requir ed to pay an amount of up to US$166m (2020: US$163m) in addition to that currently pr ovided. Futur e tax charges and our eective tax rate may be aected b y tax regime reforms in our k ey markets as well as resolution of open matters as we continue to bring our tax aairs up to date. Deciding whether to recognise deferr ed tax assets is a ﬁnancial judgment. Assets ar e only recognised when we consider it pr obable that they can be r ecovered based on for ecasts of future pr oﬁts, against which those assets may be utilised. The Group is subject to challenge bythe Brazilian and Colombian tax authorities on the deduction for tax purposes of goodwill amortisation. F urther information on the contingency is provided in note 43 to the Groupﬁnancial statements. Pensions The Group is exposed to a number of risks inher ent in deﬁned beneﬁt pension plans, as outlined in note 34(d) to the Group ﬁnancial statements. The principal ﬁnancial assumption used in determining the carrying value of pension assets/obligations is the real discount rate. If this rate increased/decr eased by 0.1%, deﬁned beneﬁt obligations at 31 March 2021 would change by appro ximately ± US$21m oset by a change in the fair value of plan assets of approximatel y ± US$20m. Litigation There continue to be a number of litigation and other claims across all our major regions. W e do not consider that the outcome of any such claims will have a materially adverse eect on our ﬁnancial position. 71 Experian plc Annual Report 2021 Strategic report Exc eptional items and other adjustments made to derive Benchmark PBT We mak e certain adjustments to derive Benchmark PBT . These are summarised in the table below . Note 6 to the Gr oup ﬁnancial statements explains the reasons for the exclusion fr om our deﬁnition of Benchmark PBT of Exceptional items and other adjustments made to derive Benchmark PBT . Y ear ended 31 March 2021 US$m 2020 US$m Exceptional items: Proﬁt on disposal of associate (120) – Restructuring costs 50 – Impairment of intangible asset 27 – Legal provisions movements 8 35 Net (credit)/char ge for Exceptional items (35) 35 Other adjustments made to derive Benchmark PBT: Amortisation of acquisition intangibles 138 124 Impairment of goodwill 53 – Acquisition and disposal expenses 41 39 Adjustment to the fair value of contingent consider ation 1 (4) Non-benchmark share of post -tax proﬁt of associates (16) (6) Interest on uncertain tax pr ovisions 11 14 Financing fair value remeasur ements (5) 111 Net charge for other adjustments made to derive Benchmark PBT 223 278 Net charge for Exceptional items and other adjustments made to derive Benchmark PBT 188 313 Further information on Ex ceptional items is provided in note 14 to the Gr oup ﬁnancial statements on page 171. Non-G AAP measures We ha ve identiﬁed and deﬁned certain non-GAAP measur es as the key measures used b y management to assess the underlying performance of the Group’s ongoing businesses. The table below summarises these measur es and there is a fuller explanation in note 6 to the Gr oup ﬁnancial statements on pages 160 to 161. Benchmark PBT Proﬁt befor e amortisation and impairment charges, acquisition expenses, Exceptional items, ﬁnancing fair v alue remeasur ements, tax (and inter est thereon) and discontinued oper ations. It includes the Group’s shar e of continuing associates’ Benchmark post-tax r esults. Benchmark EBIT Benchmark PBT befor e net interest expense. Benchmark EBITDA Benchmark EBIT before depreciation and amortisation. Exited business activities The results of businesses sold, closed or identiﬁed for closure during a ﬁnancial y ear . Ongoing activities The results of businesses which ar e not disclosed as exited business activities. Constant exchange r ates Results and growth calculated after tr anslating both years’ performance at the prior year’s aver age exchange r ates. T otal growth This is the year-on- year change in the performance of Experian’s activities at actual exchange r ates. Organic revenue gr owth This is the year-on- year change in the revenue of ongoing activities, translated at constant exchange rates, excluding acquisitions until the ﬁrst anniversary of their consolidation. Benchmark earnings Benchmark PBT less attributable tax and non-controlling inter ests. T otal Benchmark earnings Benchmark PBT less attributable tax. Benchmark EPS Benchmark earnings divided by the weighted aver age number of ordinary shar es. Benchmark operating c ash ﬂow Benchmark EBIT plus amortisation, depreciation and char ges for shar e-based incentive plans, less net c apital expenditure and adjusted for changes in working c apital, principal lease payments and the Gr oup’s share of the Benchmark proﬁt or loss r etained in continuing associates. Cash ﬂow conversion Benchmark operating cash ﬂow expr essed as a percentage of Benchmark EBIT . Return on capital employ ed (ROCE) Benchmark EBIT less tax at the Benchmark rate divided b y average c apital employed, in continuing operations, over the year . Capital employed is net assets less non-contr olling interests, plus/minus the net tax liability or asset and plus Net debt. Experian plc Strategic r eport 72 Risk management Identifying and managing risk Ide nti f yi ng a nd m a na g in g ris k is k ey t o our bu sin ess. Doi ng so help s us d el ive r l ong- te rm sha rehol der va lue a nd pr ot ect our bu sin ess, peopl e, assets, ca pi ta l an d rep uta tion. Board Group Oper ating Committee (OpCo) Executive management Audit Committee Secur ity and Co ntinuit y Steer ing Commi ttee (SCSC) A ssurance Steering Com mit tee ( AS C) T ax and T reasury Comm itte e Risk Manag ement C ommit tee s Global an d Regional Strategic Projec t Comm itte es Regiona l Risk Manag ement Commi tte es (RRMC) Executive Risk Management Committee (ERMC) Sets our over arching risk appetite and ensur es that we manage risks appr opriately across the Gr oup. The Board delegates over sight of risk management activities to the Audit Committee. The Group Oper ating Committee comprises our most senior executives. Its remit includes identifying, debating and achieving consensus on issues involving str ategy , risk, growth, people and culture, and oper ational eciency . Its meetings generally f ocus on the key issues facing our Group. Our executive management takes day -to-day responsibility for implementing the Boar d’s policies on risk management and internal control. It designates who is responsible and accountable thr ough the design and implementation of all necessary internal control systems, including policies, standards and guidance. Regularly monitors the principal risks and uncertainties identiﬁed b y our risk assessment processes, with the strategies we ha ve developed and the actions we have taken to mitigate them. Management also continually r eviews the eectiveness of our risk management system and internal control sy stems, which support our risk identiﬁc ation, assessment and reporting. Comprises senior Group executives, including the executive directors and the Company Secr etary . It oversees how we manage global risks. is a sub-committee of the ERMC. Its primary responsibility is to oversee management of global information security , physic al security , and business continuity risks. is a sub-committee of the ERMC and oversees the development and implementation of the Group’s assur ance framework. oversees management of ﬁnancial risks, including tax, cr edit, liquidity , funding, mark et and currency risk s. ensure that we appropriately r esource our strategic pr ojects, and that they are risk -assessed, and commercially and technically appr aised. The committees’ conclusions are then considered by the Board or r elevant Gr oup Principal Operating Subsidiary for approv al. oversee management of regional risk s and feed up to the ERMC. Our risk management governance structure 73 Experian plc Annual Report 2021 Strategic report Audit Committee Executive management / Risk Management Committees First Line of Defence Second Line of Defence Third Line of Defence Step 1 Risk identiﬁcation Step 2 Risk assessment Step 3 Risk response Step 4 Risk reporting & monitoring Consider key business objectives Identify principal risks Identify key contr ols Line s of busines s (regional and global) Ex per ian IT S er vic es (EI TS) Corpor ate functions Global Risk Mana gement Glob al Se curit y O ce Compliance Busine ss Continui ty Physical Securit y Lega l Global Inter nal Audit Assess con trols Es timate likeliho od, impact and velo city Consider legal, repu tation and c onduc t exp osure Accept or remediate cur rent r isk and co ntrol enviro nment Determine corre ctive action if needed Business u nit a nd regional level RRMCs and ERMC Audit Commit tee The Board is r esponsible for maintaining and reviewing the eectiveness of our risk management activities from a str ategic, ﬁnancial, and oper ational perspective. These activities are designed to identify and manage, r ather than eliminate, the risk of failure to achieve business objectives or to successfully deliver our business strategy . The risk management process is designed to identify , assess, respond to, report on and monitor the risks that thr eaten our ability to achieve our business strategy and objectives, within our risk appetite. We follo w the Three Lines of Def ence approach to risk management. Risks ar e owned and managed within the business and reviewed by our businesses at least quarterly . Global governance teams r eview risks and contr ols, including those r elating to information security , compliance and business continuity . Global Internal Audit assesses our risks and contr ols independently and objectively . The r esults of these reviews f eed into our reporting cycle, including through the risk management governance structure outlined opposite. Our risk management proc ess Three Lines of Defence All employees have First Line responsibilities Governance teams have Second Line responsibilities Global Internal Audit has Third Line r esponsibilities Risk categories Strategic risk – Country/Political/ Economic – Acquisition – Competitor – Business strategy – Publicity Financial risk – Accounting – Credit – Liquidity – Market – Currency Regulatory/ Compliance risk – Regulated activi ties – Pr ivac y – Financial crime Operational risk – T e chnology – Information security – Physical security – Continuity – Third party – People – Process Experian plc Strategic r eport 74 Risk management contin ued Our risk proﬁle Our risk identiﬁcation pr ocesses follow a dual approach: A bottom-up approach at a business unit or country level. This identiﬁes the risks that threaten an individual business unit activity . T o provide visibility of issues acr oss the business, we consolidate these risk s at a regional and global level, then escalate to the Risk Management Committees. A top-down approach at the global level. This identiﬁes the principal risks that threaten the delivery of our str ategy (see below). The diagram on this page summarises our principal risk proﬁle and trends in the thr eat levels (on a net/residual risk basis) since the last reporting period. Compared to last year , the principal risks remain the same (we have r emoved ‘data ownership, access and integrity’ as a standalone risk due to overlap with other risks, and the associated risk information is covered in other risk descriptions). Our strategic f ocus areas 1 Make credit and lending simpler , faster and safer for consumers and businesses 2 Empower consumers to improve their ﬁnancial lives 3 Help businesses verify identity and combat fraud 4 Help organisations in specialised vertical markets harness data and analytics to make smarter decisions 5 Enable businesses to ﬁnd, understand and connect with audiences Risk appetite We assess the level of risk and our associated risk appetite to ensure we focus appr opriately on those risks we face. W e target risks for assessment based on gross risk and measur e them based on net risk using a risk and control assessment methodology . W e then prioritise them for mitigation. The Board and Audit Committee review the principal risk s, of which there ar e currently nine, on an ongoing basis, as does the ERMC. The Board has deﬁned risk appetites for certain principal risks that we face during the normal course of business. W e use a variety of information sour ces to show if we are working within our tolerance for these risk s and whether or not any of them requir e additional executive attention. Our risk cultur e The Board is committed to maintaining a culture that emphasises the importance of managing risk and encourages tr ansparent and timely risk reporting. We work to align employees’ behaviours, attitudes and incentives with our risk appetite and other governance and risk management policies. Our risk governance process r einforces and facilitates appropriate ownership, accountability , escalation and management of our principal risks. This pr ocess includes: well-deﬁned roles and responsibilities acr oss our Thr ee Lines of Defence model; assigning accountability for risk -taking when making key business decisions; documenting clear boundaries and behaviour al expectations in policies and standards; and cr eating an environment that reinfor ces adherence and accountability . Current ar eas of focus Our risk landscape continues to change as both business and regulatory envir onments evolve. While COVID-19 has not led us to change our risk management framework or pr ocesses, we have ensured that the impacts of the pandemic are consider ed across all our principal risk s. W e make ref erences to COVID-19 in futur e sections. Our focus in the current year w as to continue getting more pr oactive in the identiﬁcation and management of our principal risks thr ough a combination of best-in-class risk pr actices, greater engagement acr oss the Thr ee Lines of Defence and increased use of data and analytics. While we have made good progress in all these focus areas, we would expect similar areas of focus to continue in the upcoming ﬁscal year . W e are currently undertaking an external review of our oper ational risk management progr amme to ensure it is keeping pace with our evolving risk pr oﬁle. In addition to known principal risks, we continue to identify and analyse emerging ones, and discuss these, as appr opriate, in dierent forums, including the ERMC and Audit Committee. Some of the emerging risk s we are curr ently considering include: ESG matters: we continue to develop our ESG progr amme to address dierent aspects. The Group has committed to becoming carbon neutr al in its own operations b y 2030 and has also developed its alignment to the T ask F orce on Climate-R elated Financial Disclosures (T CFD) reporting framework. Experian will be requir ed to report its environmental disclosur e aligned to the TCFD framework fr om FY22 (Annual Report 2022) onwards, however our TCFD statement in this year’s annual report (see page 53) already cover s most of the requir ed T CFD disclosure. The Gr oup has an Environmental Policy in place to address r elated matters, and an Environmental Management S ystem (EMS) designed to ISO 14001 standards that allows us to measure and monitor our dir ect environmental impact. We continue to focus on P eople and Diversity matters, including setting gender targets (see page 49). W e also continue to engage with investors and clients to addr ess their expectations. Accelerating priv acy regulation: r egulators are becoming mor e active in interpreting and enforcing priv acy regulations acr oss existing regulations, and proposing new and more stringent privacy r egulations in others. We closely monitor these developments and interact with r egulators, legislators and other stakeholders to pr ovide input. Principal risk proﬁle IMP ACT LIKELIHOOD Risk movement: Increasing Decreasing Stable Increasing competition Undesirable in vestment outcomes Dependence on highly skilled personnel Business conduct risk Loss or inappropriate use of data and systems F ailure to comply with laws and r egulations New legislation or changes in regulatory enfor cement Non-resilient IT/business environment Adverse and unpredictable ﬁnancial markets or ﬁscal developments 75 Experian plc Annual Report 2021 Strategic report Loss or inappropriate use of data and systems We hold and manage sensitive consumer information that increases our exposur e and susceptibility to cyber-attacks or other unauthorised access to data, either dir ectly through our online systems or indir ectly through our partners or thir d-party contractor s. Part of the viability assessment Risk type – Operational Risk movement Stable Potential impact Unauthorised access to consumer data could cause pr oblems for consumers and result in material loss of business, substantial legal liability , r egulatory enforcement actions and/or signiﬁcant harm to our r eputation. The impact of this risk, if it materialises, will typically be felt in the near term. Examples of control mitigation We deploy ph ysical and technologic al security measures, combined with monitoring and alerting for suspicious activities. We maintain an information security progr amme with strong governance for identifying, pr otecting against, detecting and responding to cyber security risk s and recovering fr om cyber security incidents. We impose contr actual security requir ements on our partners and other third parties that use our data, complemented by periodic reviews of thir d-party controls. We maintain insur ance coverage, wher e feasible and appropriate. Responsibility Our Global Security Oce sets policies and standards r elated to the information security progr amme. Every employee is ultimately responsible for following security policies and protocols. Changes this year External cyber security threats to businesses continue to increase in number and sc ale. We have also seen an increase in fr audulent activity seeking access to data. In addition, the inherent risk level of data exposure has also incr eased, particularly with respect to data that has not traditionally been consider ed sensitive or ‘personally identiﬁable’ . An example of increased fr audulent activity is the incident we experienced in South Africa this year where we concluded an agr eement for services with an individual fraudulently impersonating a repr esentative of a legitimate company seeking access to marketing data. While no personal consumer credit, ﬁnancial or banking information was shared by Experian and none of our infrastructur e, systems or databases were compr omised, this highlights the increased risk s related to unauthorised access to data. In r esponse to this incident, we provided support to aected consumers and businesses, engaged thir d parties to assist in our analysis and response, and have strengthened our or ganisational protocols and business processes to pr event this sort of fr aud, including new client onboarding contr ols, new data transfer pr otocols, and organisational changes to increase our privacy compliance activities. In response to cyber risk s, we continue to enhance our protection, detection and response capabilities by str engthening our security policies, pr actices and training and continue to ensure that we apply them consistently acr oss our regions and business units. W e will continue investing in the tools, people, r esources and initiatives necessary to maintain and improve our global information security progr amme. With COVID-19 and while we consider our longer-term str ategy for the futur e of work location, we continue to monitor the impact of most of our employees and third parties working remotely , including any potential exposure to vulner abilities. W e have taken technical measur es to restrict, secure and monitor devices, and added compliance requir ements for employees and thir d parties, especially those handling sensitive information. Principal risks The following pages summarise our principal risks and uncertainties with mitigating actions for each and related tr ends in the risk environment, as identiﬁed by the Board for the year ended 31 March 2021. The list is not exhaustive and may change during the next ﬁnancial year , as the risk landscape evolves. COVID-19 continues to be a consider ation in several of our principal risk s. We continue to seek to mitigate the impact of COVID-19 and remain focused on the health, safety and well-being of our employees, clients and consumers. In order to assess our Gr oup’s viability , the directors focused on thr ee principal risks that are critic al to our success. These are summarised below and discussed in more detail in the Viability assessment section following the description of our principal risks. Loss or inappropriate use of data or systems leading to serious reputational and brand damage, legal penalties and class action litigation. Adverse and unpredictable ﬁnancial mark ets or ﬁscal developments in one of our major countries of operation, resulting in signiﬁcant economic deterioration, currency weakness or restriction. New legislation or changes in regulatory enforcement, changing how we operate our business. Experian plc Strategic r eport 76 Adver se and unpredictable ﬁnancial markets or ﬁsc al developments We oper ate globally and our results could be aected by global, r egional or national changes in ﬁscal or monetary policies. A substantial change in credit markets in the USA, Br azil or the UK could reduce our ﬁnancial performance and growth potential in those countries. We pr esent our Group ﬁnancial statements in US dollars. However , we tr ansact business in a number of currencies. Changes in other currencies r elative to the US dollar aect our ﬁnancial results. A substantial rise in US, EU or UK inter est rates could incr ease our future cost of borrowings. We ar e subject to complex and evolving tax laws and interpr etations, which may change signiﬁcantly . These changes may increase our eective tax r ates in the future. Uncertainty about the application of these laws may also r esult in dierent outcomes from the amounts we provide for . We ha ve a number of outstanding tax matters and resolving them could ha ve a substantial impact on our ﬁnancial statements, c ash and reputation. Part of the viability assessment Risk type – Financial Risk movement Increasing Potential impact The US, Br azilian and UK markets are signiﬁcant contributors to our r evenue. A reduction in one or mor e of these consumer and business credit services markets could reduce our r evenue and proﬁt. We beneﬁt fr om the strengthening of currencies relative to the US dollar and ar e adversely aected by currencies weakening r elative to it. We ha ve outstanding debt denominated principally in euros, pounds sterling and USdollars. As this debt matures, we may need to replace it with borr owings at higher interest r ates. Our earnings could be reduced and tax payments increased as a r esult of settling historical tax positions or incr eases in tax rates. Adverse publicity around tax could damage our reputation. The impact of this risk, if it materialises, will typically be felt in the short to long term. Examples of control mitigation We hav e a diverse portfolio by geogr aphy , product, sector and client. We provide counter-cyclic al products and services. We con vert cash balances in for eign currencies into US dollars. We ﬁx the inter est r ates on a proportion of our borrowings. We r etain internal and external tax professionals, who regularly monitor developments in international tax and assess the impact of changes and diering outcomes. We r eview contingency plans in our key markets as to speciﬁc potential responses to evolving ﬁnancial conditions. Responsibility Our corporate and business unit ﬁnance functions monitor our external landscape, and interface with business units to develop and implement appropriate actions. Changes this year We continue to analy se the impact of potential economic downturn and associated actions, particularly in our key markets. Some of the underlying risk vectors are impr oving, while others have futur e uncertainty associated with them, as detailed below and so this will continue to remain an ar ea of focus. The global economy is expected to expand in the mid-single digits during 2021, follo wing a contraction of 4.3% in 2020 1 . This will likely positively impact areas of the business which experienced dicult trading conditions during the previous year . We continue to perform anal yses to understand the impact of changes in economic conditions on Group r evenues and have consider ed dierent economic scenarios in our viability assessment. Serasa S.A. has been successful in its challenges against the Brazilian tax authorities for the deduction of the initial goodwill amortisation arising from its acquisition by Experian in 2007, however ther e are some remaining matters that ar e yet to be resolved. The Colombian T ax Authority has r aised a similar challenge on the deductibility of goodwill in respect of the 2014 and 2016 taxyears. Historic UK tax disputes continue to be discussed with Her Majesty’s Revenue & Customs. Any changes to the US, UK and Brazil corpor ate tax rates would r esult in a change to our eective tax rate and c ash tax payments. In the USA, the new administr ation may consider tax reform pr oposals which could involve changes to the T ax Cuts and Jobs Act or the corpor ate federal income tax r ate. In the UK, it has been announced that the corporation tax r ate will increase fr om 19% to 25% from 1 April 2023. Experian continues to monitor these developments closely . New legislation or changes in regulatory enfor cement We oper ate in an increasingly complex environment and man y of our activities and services are subject to legal and regulatory inﬂuences. New laws, new interpretations of existing law s, changes to existing regulations and heightened regulatory scrutiny could aect how we operate. For example, regulatory interpretation of complex, principles-based privacy regulations could aect ho w we collect and process information for marketing, risk management and fraud detection. Part of the viability assessment Risk type – Strategic – Regulatory/ Compliance – Operational Risk movement Increasing Potential impact We may suer incr eased costs or reduced revenue r esulting from modiﬁed business practices, adopting new procedures, self-regulation and litigation or r egulatory actions resulting in liability , ﬁnes and/or changes in our business practices. The impact of this risk, if it materialises, will typically be felt in the short term. Examples of control mitigation We use internal and external r esources to monitor planned and realised changes in legislation. We educ ate lawmakers, regulators, consumer and privacy advocates, industry trade gr oups, our clients and other stakeholders in the public policy debate. Our global Compliance team has region-speciﬁc r egulatory expertise and works with our businesses to identify and adopt balanced compliance strategies. We execute our Compliance Management Progr amme, which directs the structur e, documentation, tools and tr aining requir ements to support compliance on an ongoing basis. Principal risks contin ued 1 World Bank, 5 January 2021. 77 Experian plc Annual Report 2021 Strategic report Responsibility Our Legal, Government Aair s and Compliance functions work with our business units to understand the impact of relev ant laws and regulations, including any r egulatory interpretations and associated implic ations. The business units put into place appropriate procedur es and controls designed to ensurecompliance. Changes this year New laws, new interpretations of existing law s, changes to existing regulations and r egulatory scrutiny continue to be considered and introduced, with a global focus on privacy and a general tr end towards more consumer control over data. Man y of these laws and r egulations are complex and principles-based, leading to actual and potential dierences in how regulations ar e interpreted and enfor ced after they become eective in many of the jurisdictions we operate in. In some cases these dierences in interpr etations may have to be decided in the courts. We highlight some signiﬁc ant updates below: In the USA, California voter s recently appr oved a ballot initiative to enact the California Privacy Rights Act (CPRA). The CPRA will become eective on 1 January 2023, with the California Consumer Privacy Act (CCP A) remaining in eect through that date. The CPRA further enhances the CCP A by creating a new privacy regulatory agency with expanded enfor cement and rulemaking authority , new consumer rights of data correction, expansion of opt-out rights, and increased disclosur es and opt-out rights regar ding sensitive information, among other requir ements. We are compliant with the CCP A. Several other states ar e progressing privacy legislation, with Virginia passing the Consumer Data Protection Act (VDP A) in Mar ch 2021. Mor e states are expected to enact priv acy laws befor e a national privacy standard ma y be established. In the meantime, diver gence in state laws may have an impact on products and services. In Brazil, the general data protection law (L GPD) has been eective since September 2020. While we have implemented our rigorous compliance progr amme based on the principles outlined in the law , we have alr eady seen some dierent regulatory interpr etations of these principles and how they relate to our Mark eting Services business under L GPD. Open banking is under implementation in Brazil and the Centr al Bank is progr essing discussions internally and with authorised private sector entities to deﬁne legal and technical aspects. In South Africa, Experian remains on tr ack in implementing its readiness pr ogramme f or full compliance with the Protection of Per sonal Information Act (POPIA) ahead of the 12-month implementation grace period, which ends on 1July 2021. The proposed India Per sonal Data Privacy (PDP)Bill is still being analysed by a Joint Parliamentary Committee (JPC). At this point itis unclear whether the bill will be taken uportabled, so ther e is no clarity on implementation dates. Related to COVID-19, we continue to monitor for additional rules and regulations r elated to the reporting of data. F ailure to c omply with laws and r egulations We hold and manage sensitive consumer information and we must comply with many complex privacy and consumer protection law s, r egulations and contractual obligations. Risk type – Regulatory/ Compliance – Operational Risk movement Increasing Potential impact Non-compliance may result in material litigation, including class actions, as well as regulatory actions. These could r esult in civil or criminal liability or penalties, damage to our reputation or signiﬁc ant changes to parts of our business. The impact of this risk, if it materialises, will typic ally be felt in the near term. Examples of control mitigation We maintain a compliance management framework that includes deﬁned policies, procedur es and controls for Experian employees, business processes, and third parties such as our data resellers. We assess the appr opriateness of using data in new and changing products and services. We vigor ously defend all pending and threatened claims, employing internal and external counsel to eectively manage and conclude such proceedings. We analy se the causes of claims, to identify any potential changes we need to make to our business processes and policies. We maintain insur ance coverage, where feasible and appropriate. Responsibility Our Legal and Compliance functions work with our business units to understand the impact of relevant la ws and regulations, including any regulatory interpr etations and associated implications. Our business units put into place appropriate pr ocedures and contr ols designed to ensure compliance. Changes this year We ha ve faced increased r egulatory scrutiny , and regulatory and government enquiries and investigations in sever al jurisdictions. The laws and regulations to which we ar e subject are complex, and in man y cases principles-based. Compliance with these laws and r egulations continues to get more challenging as interpretations may dier among r egulators, and as changes in the regulatory envir onment evolve. In the UK, the UK Information Commissioner’s Oce (ICO) issued its ﬁnal Enforcement Notice (EN) on 12 October 2020. W e disagree with the ICO’s interpretation of the EU Gener al Data Protection Regulation (GDPR) and ha ve ﬁled our appeal, which will be hear d at the end of November 2021. We have also seen closer contact by the Financial Conduct Authority (FCA) during the COVID-19 pandemic. In the USA, we ar e subject to ongoing regulatory supervision by the Consumer Financial Protection Bur eau (CFPB), and f or some matters by other regulator s such as the New Y ork Department of Financial Services (DFS). Over the past year , the number of US class action lawsuits have decr eased slightly , however individual consumer cases ar e trending up. While we ar e managing the eects associated with these investigations and lawsuits, the cost of defending litigation is rising and consequently the risk of potential liability and impact on some parts of our business still remains signiﬁc ant. Related to COVID-19, we continue to closely monitor call centr e volumes and other indicators to ensur e that we continue to adhere to statutory and regulatory deadlines. Ther e is a potential for increased r egulatory investigations and/or litigation if any capacity constr aints on our side or at data providers r esult in missing statutory deadlines, such as for disputes. Experian plc Strategic r eport 78 Non-resilient IT/business envir onment Delivery of our products and services depends on a number of key IT sy stems and processes that expose our clients, consumers and businesses to serious disruption in the event of systems or operational failur es. Risk type – Operational Risk movement Stable Potential impact A signiﬁcant failur e or interruption could have a materially adverse eect on our business, ﬁnancial performance, ﬁnancial condition and reputation. The impact of this risk, if it materialises, will typic ally be felt in the near term. Examples of control mitigation We maintain a signiﬁc ant level of resilience in our operations, designed to avoid material and sustained disruption to our businesses, clients and consumers. We design applic ations to be resilient and with a balance between longevity , sustainability and speed. We maintain a global integr ated business continuity framework that includes industry-appr opriate policies, pr ocedures and controls for all our sy stems and related processes, as well as ongoing review , monitoring and escalation activities. We duplic ate information in our databases and maintain back -up data centres. Responsibility Our corporate and business technology teams, assisted by the Business Continuity function, are r esponsible for maintaining appropriate primary and back -up infrastructur e to minimise disruption. Changes this year Throughout this year we experienced isolated events that tested our plans and processes. Fr om an operational resiliency standpoint, including related to the impact of COVID-19, we continue to closely monitor our infrastructur e and processes to manage our commitments to clients, consumer s and regulators. In addition, we pr ovide tr aining to our key responders and c arry out periodic exercises to validate that our procedur es are ﬁt for purpose. We ha ve designed our applications using a ‘build anywhere, deploy anywhere’ strategy , to support portability and maximum resilience. Our approach to asset lifecycle management helps ensure that we r etire and r eplace our technology in a timely fashion. A global initiative continues progr ess to maximise business value and maintain leadership through acceler ated technology transformation. Business conduct risk Our business model is designed to create long-term value for people, businesses and society , thr ough our data assets and innovative analytics and softwar e solutions. Inappr opriate execution of our business strategies or activities could adversely aect our clients, consumers or counterparties. Risk type – Strategic – Operational Risk movement Stable Potential impact Consumers or clients could receive inappropriate pr oducts or not have access to appropriate pr oducts, r esulting in material loss of business, substantial legal liability , regulatory enfor cement actions or signiﬁcant harm to our reputation. The impact of this risk, if it materialises, will typic ally be felt in the short term. Examples of control mitigation We maintain appr opriate governance and oversight thr ough policies, pr ocedures and controls designed to safeguar d personal data, av oid detriment to consumers, pr ovide consumer-centric pr oduct design and delivery , and eectively r espond to enquiries and complaints. The above activities also support a robust conduct risk management framework. We enfor ce our Global Code of Conduct, Anti-Corruption Policy and Gifts and Hospitality Policy . If we believe employees or suppliers are not fol lowing our conduct standards, we will investigate thor oughly and take disciplinary action where appr opriate. Responsibility Our Compliance function sets policies and standards, including the Code of Conduct. All employees are accountable f or understanding and following our conduct standards. Changes this year Regulators have continued to put public trust and consumer and investor protection at the centre of their mission statements and have promoted prudent conduct risk management. We periodic ally evaluate our policies and other protocols to ensur e that we stay up to speed with external and internal expectations. Related to COVID-19, we continue to take industry-leading positions designed to pr otect and educate consumers, as well as to promote the responsible r eporting of data, with appropriate safeguar ds, in order to help the economic recovery fr om the crisis. Dependence on highl y skilled personnel Our success depends on our ability to attract, motivate and retain key talent while also building future leadership. Risk type – Operational Risk movement Stable Potential impact Not having the right people could materially aect our ability to service our clients and grow our business. The impact of this risk, if it materialises, will typic ally be felt in the long term. Examples of control mitigation In every region, we have ongoing progr ammes for recruitment, personal and car eer development, and talent identiﬁc ation and development. As part of our employee engagement strategy , we conduct periodic employee surveys. W e track progr ess against our action plans. We oer competitive compensation and beneﬁts and review them r egularly . We actively monitor attrition r ates, with a focus on individuals designated as high talent or in strategic ally important roles. Principal risks contin ued 79 Experian plc Annual Report 2021 Strategic report Responsibility Our business units work with the Human Resources function to set and implement talent management strategies. Changes this year We continue to tak e steps to eectively manage our ability to attract, develop and retain employee talent and believe our mitigation eorts have stabilised the over all risk to Experian. We continue to tr ansform our T alent Acquisition proposition to better attr act talent to Experian. We ha ve embedded mobile-enabled technology , introduced c andidate experience surveys at dierent stages of the hiring and onboar ding process, signiﬁcantly enhanced our pr esence on social media, implemented k ey performance indicators for r ecruiters and continue to upskill our capability within the T alent A cquisition team. We monitor employ ee engagement through a variety of channels and have been implementing the action plans from our periodic surveys. In addition to high response rates, our latest surveys continue to show strong engagement and enablement scor es. V oluntary attrition rates are stable but continue to be a focus. Signiﬁcant activity in the DEI space pr evails with senior executives taking up Sponsor roles for key ar eas of our DEI strategy , including setting gender and ethnicity targets. With COVID-19, we have kept the health and safety of our employees as the primary consideration of our pandemic r esponse. Most of our employees are still working r emotely . An eort is underway to determine our strategy f or work arrangements in the futur e. W e expect this to be guided by a consistent global framework and principles, with local ﬂexibility around the appr oach to account for legal and cultural nuances. Increasing c ompetition We oper ate in dynamic markets such as business and consumer credit information, decisioning software, fraud, marketing, and consumer services. Our competitive landscape is still evolving, with tr aditional players r einventing themselves, emerging players investing hea vily and new entrants making commitments in new technologies or approaches to our markets. There is a risk that we will not respond adequately to such disruptions or that our products and services will fail to meet changing client and consumer prefer ences. Risk type – Strategic Risk movement Stable Potential impact Price reductions may r educe our margins and ﬁnancial results. Increased competition may reduce our market shar e, harm our ability to obtain new clients or retain existing ones, aect our ability to recruit talent and inﬂuence our investment decisions. W e might also be unable to support changes in the way our businesses and clients use and purchase information, aecting our operating r esults. The impact of this risk, if it materialises, will typically be felt in the long term. Examples of control mitigation We continue to r esearch and in vest in new data sources, analytics, technology , capabilities and talent to deliver our strategic priorities. We continue to develop innov ative new products that lever age our scale and expertise and allow us to deploy capabilities in new and existing markets and geographies. We use rigor ous processes to identify and select our development investments, so we can eciently and eectively intr oduce new products and solutions to the market. Where appr opriate, and a vailable, we make acquisitions, tak e minority investments and enter into strategic alliances to acquir e new capabilities and enter into new markets. Responsibility Our Corporate Development and Experian V entures teams, as well as our business units, monitor the competitive landscape in or der to develop and implement appropriate actions. Changes this year We ar e proactive in our eorts to evaluate competitors and markets, and pursue investments and enhancements to our data, analytics, technology and c apabilities where appropriate, available and feasible. T raditional competitors continue to pursue dierentiated data assets, adjacent vertical expansion, and new geogr aphic markets. In the Consumer Services space, other ﬁrms hav e become bigger competitors in recent y ears as we have expanded in areas such as digital marketplaces and identity protection. We feel conﬁdent in Experian’s relative position and competitive advantages, but the broader landscape continues to evolve. There is a long-term competitive risk to consider related to newer entr ants building information networks based on consumer data. While some of them may not be trying to build a credit bur eau or fraud business per se, this is not many degrees aw ay from our cor e business and is being closely monitored. Certain governments and centr al banks in countries where we have cr edit bureaux are collecting loan data from bank s, principally for systemic risk analysis, though some may share individual loan data with lenders, which has the potential to compete with some of our credit refer ence data services. The timing and whether any government agencies choose to go this route is uncertain. In India, the R eserve Bank of India (RBI) had announced plans to establish a Public Credit Registry (PCR) in 2018. The full extent of competition with private credit bur eaux in India is uncertain at this point. In the USA, ther e have been r eferences to the potential formation of a government-owned credit bur eau, though ther e have been no actual proposals to establish such a bur eau. With COVID-19, we continue to engage with our clients to help them navigate risk decisions, such as lending, in the curr ent envir onment ofeconomic uncertainty . Experian plc Strategic r eport 80 Undesir able inv estment outcomes We critic ally evaluate, and may invest in, equity investments and other growth opportunities, including internal performance improvement pr ogrammes. T o the extent invested, any of these may not produce the desir ed ﬁnancial or operating r esults. Risk type – Strategic – Operational Risk movement Stable Potential impact F ailure to successfully implement our key business strategies could ha ve a materially adverse eect on our ability to achieve our growth tar gets. Poorly executed business acquisitions or partnerships could result in material loss of business, incr eased costs, reduced revenue, substantial legal liability , r egulatory enforcement actions and signiﬁc ant harm to our reputation. The impact of this risk, if it materialises, will typically be felt in the long term. Examples of control mitigation We analy se competitive threats to our business model and markets. We c arry out comprehensive business reviews. We perform compr ehensive due diligence and post-investment r eviews on acquisitions and investments. We employ a rigor ous capital allocation framework. We design our incentive pr ogrammes to optimise shareholder value thr ough delivery of balanced, sustainable r eturns and a sound risk proﬁle over the long term. Responsibility Our Corporate Development and Experian V entures teams, as well as our business units, monitor the investments we make to ensur e outcomes are in line with expectations. Changes this year We ha ve refr eshed policies and standards that apply minimum requir ements to our acquisition and integration pr ocesses, including enhanced information security requir ements. We ar e analysing competitive threats to our business model and will take advantage of acquisitions, in vestments and strategic partnerships, and invest in new technologies where appr opriate. Related to COVID-19, we continue to closely monitor our acquisition pipeline. W e are closely engaged with each of our minority investments to oer guidance and advice and, wher e appropriate, are pr oviding commercial oerings that may be helpful to these companies. In addition, we continue to r esearch an y available opportunities for investment. Principal risks contin ued 81 Experian plc Annual Report 2021 Strategic report Viability and going concern Going conc ern Our going concern assessment focuses mainly on immediately available sour ces of liquidity to fund our anticipated trading pattern, plus anticipated acquisition spend, r eturns to shareholders and c apital investment, ensuring we always maintain a comfortable mar gin of headroom in c ase of the unexpected. As is now best practice, we also perform a review of factors that might indicate the beginnings of going concern issues, and hav e found none. Viability Our viability assessment focuses mainly on the expected future solvency of the Gr oup in the face of more sever e, but plausible, unexpected events. We use the going concern modelling as a base, and lay er on the eects of downside scenarios to assess the magnitude and practic ality of measures we could tak e to continue to trade in the face of such events. We ar e not expecting the current economic environment, under any plausible scenario, to develop into a scenario that could threaten our viability . In the last year , the Gr oup has demonstrated its resilient business model and diverse strategy , both of which are described within the Strategic r eport . They exemplify our underlying purpose to create a better tomorr ow , how we create v alue for our stakeholders and communities, and how our data and analytics are helping addr ess the changing needs of consumers and businesses. Our strategy has enabled our business to grow and achieve good ﬁnancial results consistently over the last decade, despite changes both in the economic cycle and in our senior leadership team. We consider curr ent-year business performance and our future pr ospects by conducting a regular cycle of str ategic planning, budgeting and forec asting. These processes appraise r evenue, Benchmark EBIT , cash ﬂows, dividend cover , committed and for ecast funding, liquidity positions and other key ﬁnancial r atios, including those relevant to maintaining our investment-gr ade credit ratings. This year , despite our r esilient and better-than- expected performance in the face of the pandemic and its associated global economic downturn, in addition to our usual modelling, we have performed a str ess test to anticipate the impacts of a prudent assumption of a 5% decline in Benchmark EBIT year -on-year . Assessment period There ar e a wide variety of time horizons relevant to managing our business and some of these are highlighted in the chart below . In conducting our viability assessment we have focused on a three- year timeline because we believe our three- year ﬁnancial planning process pr ovides the strongest basis f or reviewing the outlook for our business beyond the current ﬁnancial y ear . The assessment proc ess and ke y assumptions While we assess our prospects thr ough various parts of our planning cycle, we speciﬁcally r eview our three- year growth expectations and the external environment as part of the annual strategic planning pr ocess. The Board participates in this r eview , using the January Strategy meeting as a foc al point. We then develop our detailed annual budget, together with an update to the ﬁnancial plan for the two subsequent years. Current ec onomic outlook COVID-19 presents a challenging context for accurate f orec asting. We ha ve again supplemented our normal corporate plan process with a number of scenarios r eﬂecting the impact of the pandemic in our key business territories across a r ange of severities. Some countries and businesses may be more heavily aected by the pandemic than others, in longevity and scale. In many of the markets for our services, demand is r elated to employment levels and other economic factors. W e used themost severe of these scenarios, which equates to a 5% decline in Benchmark EBIT year-on- year , to str ess test the base year of ourmodel, with our str ategic plan growth ratesther eafter . Additionally , we assume the Gr oup continues toachieve strong c ash ﬂow conversion, and maintains its investment-gr ade credit rating such that funding in the form of capital markets debt, committed bank borr owing facilities oralternatives is available in all plausible market conditions. We assume eective tax r ates to be broadly stable (before the impact of any changes oflegislation) over the medium term. Assessment of viability The Group continues to be subject to its principal risks, which we have reassessed in the light of COVID-19 (see the principal risks section in the Strategic r eport). T o assess the Group’s r esilience to adverse outcomes, its for ecast performance over thethree- year period – including capital expenditure, costs of acquisitions and returns toshareholders – was sensitised to r eﬂect aseries of scenarios based on the Group’s principal risks. This assessment included a reasonable worst -case scenario in which the Group’s principal risk s manifest to a ‘severe butplausible’ level. The assessed risks for which the impacts were applied in aggr egate, are shown overleaf . 1 year 2 years 3 years 5 years 10 years + Time horizons aecting prospects T ypical service life of data assets Investment appraisal – acquisitions and or ganic Share incentive plans IT systems development Financial plan including cash ﬂow forec asts Long-term ﬁnancing – bonds Medium-term ﬁnancing – revolving cr edit Management succession planning Detailed budgets Pensions Experian plc Strategic r eport 82 Expected future sol vency The Group had: undrawn committed bank borr owing facilities of US$2.7bn at 31 March 2021 only one borrowing facility covenant, requiring Benchmark EBIT to e xceed three times net interest expense befor e ﬁnancing fair value remeasur ements (as at 31 March 2021 our cover is 11 times) Benchmark operating c ash inﬂows of US$1.5bn and interest expense of US$0.1bn for FY21. Our modelling shows that: under our continued COVID-19 stress test scenario, which assumes a 5% decline inBenchmark EBIT year -on-year , with associated reductions in c ash ﬂow , we wouldbe able to maintain thesigniﬁcant majority of our undrawn committed bank borrowing facilities under our harshest ‘severe but plausible’ scenario we would comfortably maintain sucient undrawn borr owing capacity and satisfy all borrowing facility covenants further signiﬁcant headroom could be made available by sc aling back capital investment or oper ating expenditure in all scenarios our debt covenants wouldbe comfortably satisﬁed. The results of the str ess-testing show that, due to our diversiﬁed nature – which includes signiﬁcant counter-cy clical pr otection, the resilience of the cor e business, its substantial free c ash ﬂows and its strong in vestment- gradecr edit rating – we would withstand the considered scenarios wer e these to occur during the forec ast period, despite the impactsof COVID-19. Viability statement Based on their assessment of prospects and viability , the dir ectors conﬁrm that they have areasonable expectation that the Gr oup will beable to continue in operation and meet its liabilities as they fall due over the three- year period ending 31 March 2024. Looking further forward, the directors have considered whether they are awar e of any speciﬁc relevant factors beyond the three- year horizon that would threaten the long-term ﬁnancial stability of the Group over a ten- year period and have conﬁrmed that, other than any r esidual uncertainty surrounding COVID-19, the eects of which have been considered in the analy sis, they are not awar e of any . Strategic r eport This Strategic r eport was approved by a duly authorised committee of the Board of dir ectors on 18 May 2021 and signed on its behalf by: Charles Brown Company Secretary 18 May 2021 Th e loss or inap propr iate use o f data or systems , leading t o serious reput ational andbr and damag e, legal p enaltie s and classaction litigation. Adver se and unpredic table ﬁnancial marke ts or ﬁs cal dev elopme nts in on e or mor e of our major c ountri es of op eratio n, res ulting in signi ﬁcant e conomi c deterioration , currency weaknes s orre str ictio n. New le gislat ion or chang es in re gulator y enforcement, changing how we operate our bus iness. For this , we ass ess ed the ma ximum cre dible ex tent of a data b reach an d mo delled t he likely ﬁnan cial impac ts thro ugh loss o f revenu e, dispute an d re gulator y ac tion s, and th e cost s of remediation. For this, we assessed the possible range of outcomes, bey ond our base case, due to the COVID-19 pandemic. For this, we assessed the maximum credible extent of simultaneous legal actions in two of our core markets and modelled the likely ﬁnancial impacts after potential insurance r ecoveries. Principal risk Impact modelled Viability and going concern contin ued Governance In this section 84 C hairman’ s intr oduct ion 86 Bo ard of dire ctor s 88 Cor porate governa nce report 99 Nomination and Corporate Governance C ommittee rep ort 1 0 4 Au dit Co mmitte e rep or t 1 1 1 Rep or t on direc tors’ remuneration 1 35 Dire ctor s’ repor t Gover nance 83 Experian plc Annual Report 2021 Experian plc Governance 84 Chairman’s introduction Good corpor ate governance is at the heart of our business As Chairman, one of m y key roles is to ensur e that the Board and Experian continue to have high standards of corpor ate governance while, at the same time, establishing and continually developing the right controls to pr ovide the Board with the appr opriate level of oversight and assurance. By having a sound corporate governance fr amework, we c an ensure eective and ecient decision-making, and the right balance of knowledge, diver sity , skills, experience and challenge to monitor and manage the risks we face. COVID-19 pandemic In the 2020 Annual Report, published in June 2020, I observed that the last time the Experian Board had all phy sically met was January 2020, and that none of us could have imagined how the world would change in the months following the start of the pandemic. Sadly , similar conditions apply one year on and, while the roll -out of vaccines pro vides some hope, the pandemic is not over yet. In what has been a challenging global environment, the Board had a busy year , including COVID-19 focused meetings at the height of the crisis and increased r eview of ﬁnancial and operational performance. During the year , the Boar d: considered the payment of dividends; balanced business performance and shareholder inter ests; approved the issue of debt securities and a funding plan for the ﬁnancial year; considered an update on workfor ce pay and policies from Geor ge Rose, our Remuner ation Committee Chairman, follo wing his meeting with the UK and Ireland People F orum; consulted with shareholders on our new Remuner ation Policy (which received a 95.34% favour able vote at the Annual General Meeting in July 2020), and considered a number of important str ategic acquisitions in North America, Latin America and EMEA. The Chief Executive Ocer , Compan y Secretary and I regularly ev aluated possibilities for the Board to meet in person during the y ear . However , as in many ar eas of all our business and personal lives, the Board embr aced technology and all Board and committee meetings were held using video. Although not ideal, ther e was no deterior ation in the engagement of the Board, nor in the quality of debate, challenge and discussions as we worked (and continue to work) to ensure good corporate gov ernance, over sight and monitoring during the continuing pandemic. Equally , the pandemic has not impacted the commitment that our directors ha ve to the Experian Board – our dir ectors had 100% attendance at Board and committee meetings held during the year . As discussed at the January 2021 strategy presentations, Experian and the Board c an be proud of the r esilience of the business and the ingenuity shown by our employees, in a situation where the work envir onment and expectations underwent a rapid change, and where the way we engage with employ ees, clients, supplier s, r egulators and other stakeholders had to be r eoriented practic ally overnight. Experian was pr oud to put its people ﬁrst in its response to the pandemic and, from a cultural per spective, our people ha ve been pleased with the ability to be productive in their roles, the communications r egarding CO VID-19 and the support from managers. One of the positive things from the pandemic was how Experian demonstrates the critic al role it plays in society , helping people, governments and businesses. As the pandemic continues, and as we think about new way s of working, the Boar d will continue to partner closely with management to safeguard our employees, customers, communities and our business to ensure Experian is in the best possible place to move forwar d once the pandemic has passed. Mike Roger s Chairman On behalf of the Experian Board, I am delighted to present the Corpor ate governance r eport for the year ended 31 Mar ch 2021. The aim of the report is to pr ovide an overview of the Gr oup’s governance fr amework and the Board’s appr oach to maintaining good corpor ate governance during this challenging year , as well as summarising the work of the Board and its committees in discharging their duties and responsibilities. 85 Experian plc Annual Report 2021 Gover nance Board c omposition and succession The Nomination and Corporate Gov ernance Committee continues to lead the process for Board appointments, and ensures that plans are in place for or derly Board and senior management succession. During the y ear , on the recommendation of the Committee, Alison Brittain was appointed as a non- executive director . We wer e delighted to welcome Alison to the Board, albeit virtually , and she brings over 25 years' senior management experience in major ﬁnancial institutions, alongside ﬁve y ears as the Chief Executive of a FTSE 100 leisure business with UK and growing international oper ations. The Company Secretary and I ensur ed that a tailored induction pr ogramme w as put together for Alison. This was again pro vided virtually by global executives, and was well received. The Committee also recommended the appointment of Jonathan Howell to the Board on 1 May 2021. Key attributes that Jonathan brings to the Board include a wealth of ﬁnancial, str ategic, technology and regulatory expertise, encompassing both Business-to-Business (B2B) and Business-to-Consumer (B2C), which is of signiﬁcant beneﬁt to Experian. The Committee’s work during the year also included agreement on certain key Boar d composition and succession considerations, including areas of focus for futur e non- executive director r ecruitment , continued focus on diversity and the recruitment of non-executive director s who are serving executives, and the preferr ed timing of non-executive recruitment including of potential successors to the Audit and Remuner ation Committee Chairmen. There is mor e detail on Board composition and succession beginning on page 100. Board evaluation A key element of good governance is an annual evaluation to ensure that the Boar d, its committees and Board members ar e continuing to operate and perform eectiv ely . The UK Corporate Gov ernance Code (the Code) recommends (and the Boar d supports) an external evaluation every thr ee years. A comprehensive and externally facilitated Boar d evaluation took place last year . This year , our Board evaluation w as an internal one which (in line with our agreed thr ee-year cy cle) concentrated on pr ogress on last year’s areas of focus and the resulting actions, as well as agreeing new ar eas of focus for the coming year . The evaluation pr ovided the Board with the assurance that actions fr om the external evaluation, including around Boar d succession, were pr ogressing well, and the Board concluded that it was operating eectivel y . The evaluation process also allo wed the Board to identify opportunities for it to further improve its eectiveness. Y ou will read later about the results of the evaluation and the ar eas of focus that we have agreed. Conclusion I hope you ﬁnd this Corpor ate governance report helpful in understanding the arrangements and pr ocesses we have in place at Experian, and what we hav e done in terms of the recommendations of the Code. Even though it has been a challenging year , and the COVID-19 pandemic continues to impact our business, I believe that the Boar d is well placed to provide the str ategic oversight and stewardship r equired to ensur e that Experian continues to deliver long-term sustainable success. The 2021 Annual General Meeting will be held on 21 July 2021. F urther details will be published in the Notice of Annual General Meeting, which has been sent or made av ailable to shareholders, and is also available on the Company’s website, www .experianplc.com. Statement of complianc e The Board is committed to the highest standards of corpor ate governance and, for the year ended 31 March 2021, other than one element of Provision 38 in r elation to alignment of pension contribution rates (as explained below), the Compan y complied with all the provisions of the UK Financial R eporting Council’s (FRC’s) UK Corpor ate Governance Code (as published in July 2018), the UK Financial Conduct Authority’s (FCA ’s) Disclosure Guidance and T ransparency Rules sour cebook sections 7.1 and 7.2 (which set out certain mandatory disclosure r equirements), the FCA ’s Listing Rules 9.8.6R, 9.8.7R and 9.8.7AR which include the ‘comply or explain’ requir ement and, on a voluntary basis, the UK Department for Business, Ener gy and Industrial Str ategy (BEIS) Directors’ R emuneration R eporting Regulations and Narrative R eporting Regulations. These documents are publicly av ailable as follows: The Code can be found at www .frc.or g.uk The FCA ’s Disclosure Guidance and T ransparency Rules sour cebook as well as Listing Rules can be found at www . handbook.fca.or g.uk The BEIS Directors’ R emuneration R eporting Regulations and Narr ative Reporting Regulations can be found at www .gov .uk. In addition, the FRC Guidance on Risk Management, Internal Contr ol and Related Financial and Business Reporting can be found at www .frc.org.uk. Provision 38 – the Company is lar gely compliant with this provision. The area of partial compliance relates to alignment of pension contribution rates of the executiv e directors with the wider workforce. The rate for our US-based executive director is already aligned with the wider US workforce, and the rates for our two UK -based executive directors are already aligned with those av ailable to other senior UK employees. The r ates for any new UK -based director would immediately be aligned with the wider workforce, and the rates for our two existing UK -based executive directors will be aligned with the wider UK workforce by the end of 2022, following the requir ed amendments to contractual arrangements. Experian corpor ate website The website www .experianplc.com contains additional information about our corporate gov ernance: T erms of refer ence of the principal Board committees The schedule of matters reserved to the Board The Chairman’s and the CEO’s split ofduties, and the duties of the Senior Independent Director The Company’s memor andum and articles of association Details of AGM pr oxy voting by shareholders, including votes withheld. Experian plc Governance 86 Board of director s Re Nm Mike Roger s (56) Chairman App ointed to t he Boa rd on 1 July 201 7 , and as Chair man (and Chair man of the No mination an d Cor por ate Gov ernanc e Commi tte e) on 2 4 July 2 0 19. Other current roles: Mike is a non- exec utive dire ctor of Nat West Gr oup plc (he c hairs it s Gro up Sustaina ble Bank ing Comm itte e, and si ts on the Group Perf ormance and Remu neration Com mitt ee) and is th e non- exec utive C hairman of Ae gon UK (and ce rt ain of it s regul ated subsidiar ies). Ski lls an d contr ibuti on: Mike br ings over 30 years of bank ing and ﬁnancial ser vices exper ience, with a reputation for strategic insight an d focus ed exe cution . His curr ent and previous board -level experience, both executive and no n- execut ive, is of h uge value to t he E xperian Bo ard. Exper ience: Mike was Group Chief Executive O cer of L V= Group f rom 200 6 until 201 6, durin g which tim e he grew th e organis ation into a signi ﬁcant pl ayer in the l ife and g enera l insur ance mar ket. Be fore tha t, Mike was w ith Bar clays pl c for mor e than 20 year s, hol ding a numb er of senio r roles , mos t recent ly as Manag ing Director , UK Reta il Ba nking. He was pre viously a n on- execu tive dir ector o f the As sociation of British Insurers. Brian Cassin (53) Chief Executive Ocer App ointed to t he Boa rd as Chie f Financial O cer on 30 A pril 201 2, an d as Chief E xecu tive O cer on 1 6 J uly 201 4. Other current roles: Brian is a non -e xecuti ve dire ctor of J S ainsbur y plc an d sits o n its Au dit and Nomination C ommitte es. Skills an d c ontribu tion: Bri an bring s strong leadership, a cl ear view of strategic objectives and de cisive ma nageme nt skill s to this role . He has stron g ﬁnancial and commercial acumen and a br oad ra nge of op erati onal comp etencie s. His non -e xecuti ve role a ugment s his str ong board -level experience . Exper ience: Brian was previously the Chief F inancial O cer of E xp erian and , befo re that , Managing Dir ect or at Gre enhill & Co . He has al so hel d vario us senio r roles a t Barin g Brothers International and the London Stock Exchang e. Lloyd Pitchford (49) Chief Financial Ocer App ointed to t he Boa rd on 1 Oc tober 2 0 1 4. Other current roles: Lloyd is a no n- execut ive dire ctor (and cha irs the Au dit Comm itte e) of Bunzl plc. Skills an d c ontribu tion: Lloyd is a qual iﬁed acc ountant . He holds a n MBA and has d eep ﬁnancial a nd str ategic e xper ience , built up thro ugh a care er wor king in co mplex , growth- orien ted, gl obal org ani sations, ac ross a ran ge of indus trie s and re sponsib ilitie s. He br ings addi tional p erspe cti ves to E xpe rian fro m his non -e xecuti ve role w ith Bunzl p lc. Exper ience: Bef ore joinin g Ex perian , Lloy d held a wid e por t folio of ﬁn ance and o perat ional res ponsibi litie s: as Chief F inancial O cer of Inter tek Gr oup plc; in s enior ﬁna nce pos itions (includ ing Group F inancial Co ntrolle r) at BG Group plc; an d in ﬁnancial and commer cial role s at Mobil O il. Jonathan Howell (58) Non-executive director App ointed to t he Boa rd on 1 May 2021 . Other current roles: Jonathan is th e Chief Financ ial Oc er of Th e Sage Gr oup plc . Skills an d c ontribu tion: Jonathan has a w ealth of ﬁnancial, str ategic, te chnology and regulator y exper tise, encompassing both Busin ess- to- Busine ss (B2B) and Bus iness -to- Con sumer (B2C), wh ich is of huge b eneﬁ t to E xper ian. He is a hi ghly regar ded F TSE 100 Chief F inancial O cer , a nd als o brin gs considerable executive and non-e x ecutive UK-list ed boardroom experience. Exper ience: Jonathan was previously an independent non- executive director and Chair man of the Au dit and Risk C ommit tee of Th e Sage Gr oup plc ., for ﬁ ve years w hile ser v ing as Gro up Finance D irec tor of Clos e Brot hers Gr oup plc fo r ten year s until Nove mber 201 8. B efor e that he was Gr oup Financ e Dire ctor at th e Lond on Stock E xchange Gro up plc for nin e years an d has als o bee n a non -exe cuti ve direc tor of EM AP plc an d Chair man of F TSE Inter national . Th e early pa rt of Jona than' s car eer was a t Pric e W ater hous e whe re he quali ﬁed as a cha rte red ac countant . Luiz Fleury (64) Non-executive director App ointed to t he Boa rd on 8 Sep tember 201 5. Other current roles: Luiz is a Boar d memb er of Car refo ur Brazil (th e tradin g name of Ata cadão S. A. ), Magnopus , Inc. an d DOT Z S. A. Skills an d c ontribu tion : Luiz has sp ent mos t of his car eer in ﬁnan cial ser vi ces and ha s ex tensiv e insight and d eep loc al know ledge o f the Brazil ian ﬁnancial market. His consi derable boardro om experience adds to the strength, dept h and ee cti venes s of our Bo ard. Exper ience: Luiz has held Chief Executive roles at Ce tip S. A. , Banco Ib i and Rede card , togeth er wit h senior ﬁna nce and inve stm ent posit ions at Ban co Citiba nk S. A., B anco Mar ka S. A. a nd C& A Bren ninkmey er Brasil . Luiz wa s Presi dent and a memb er of the E xecu tive B oard at C etip S. A ., and a B oard me mber of Gr upo S equóia d e Lo gístic a, Ene va S. A. , Disco unt Malls d o Brasil , Ban co Ibi and FH V Hold ings Ltda. Au Nm Re Au Nm Re Caroline Donahue (60) Non-executive director App ointed to t he Boa rd on 1 Januar y 201 7 . Other current roles: Carolin e is on the B oard of GoD addy In c., Em erge A meri ca, an d the Com puter His tor y Muse um. She is al so on t he E xecuti ve Comm itte e of Nor thwe ster n C1 00, and is a m entor for Sh e- Can . Skills an d c ontribu tion : C aroli ne brings extensive exp erience of international markets and te chnolo gy as wel l as know ledge of consumer sales and marketing, innovation and consumer-centricit y . T he Board also ben eﬁts fro m her insight a nd ex tensive e xper ience in mass- market, digital , multi-channe l and Busine ss-to -C onsumer (B2C) dis tribu tion, marketing, an d brand and sale s management. Exper ience: Car oline pr eviou sly held ro les at Intuit w here sh e was E xecuti ve Vic e Presi dent, Chief Ma rketing an d Sales O c er; S enior Vi ce Presi dent, Sales and Chann el Marketing; and Vi ce Pre sident and D irec tor of Sale s. She al so held s ales an d channel mana gement r oles at Knowledge Adventu re, NeX T Computer and Apple, Inc. Au Nm Re * Code principle Board Leadership 87 Experian plc Annual Report 2021 Gover nance Au Nm Re Au Nm Re Kerry Williams (59) Chief Operating Ocer App ointed to t he Boa rd on 1 6 Jul y 20 1 4. Other current roles: Kerr y is a Bo ard memb er of Paci ﬁc Mut ual Holding C ompany, and the US Institute for Intergovernmental Research. Skills an d c ontribu tion: Kerr y hol ds an MBA and has b uilt up a signiﬁ cant and de ep know ledg e of Ex peria n ’s global busin ess an d ope ratio ns, thr ough the le ader ship role s he has held . He br ings to E xper ian and the B oard a wid e range o f skill s from his b ackgroun d in the ﬁnancial ser vice s industr y and his non- executive roles. Exper ience: Kerr y ’ s role s at Ex per ian have included Group Deput y Chief Operating Ocer , Pre sident of C redit S er vice s, Pr esiden t of Ex perian Latin Americ a, and Group President of Cre dit Ser v ices an d Deci sion Analy ti cs, E xper ian Nor th A meric a. Pr evious ly , h e was President at ERi sk Holdi ngs Incorporated, Senior Vice Pre sident/General Manager at Bank of A mer ica and h eld seni or manage ment posi tions at Wel ls Fargo Ban k. Dr Ruba Borno (40) Non-executive director App ointed to t he Boa rd on 1 Ap ril 201 8. Other current roles: Ruba is a Senio r Vice Pre sident an d Gener al Manage r at Cisco . Skills an d c ontribu tion: Ruba holds a P h.D., a Mast er of Scien ce in Elec tri cal Engin eer ing, and a Bachelo r of Science i n Compute r Engi neering. She was a n Intel Ph. D. fellow at t he Nation al Science F ound ation ’s Eng ineering R e searc h Center fo r Wireles s Integrate d MicroSystems . She br ings ad vance d techno logie s expe rt ise to E xper ian. We ben eﬁt gre atly fro m her foc us on suppor ting businesses in strate gically ada pting to the th reat s and opp or tuniti es creat ed by techn olog y , as w ell as pus hing disru ptive techn olog y to create n ew oppo rt unitie s. Exper ience: Ruba sa t on the Bo ard of T he T ec h Muse um of Innova tion in Silic on Valley. She was pre viously a t The B oston C onsultin g Group (BC G ), wher e she spe cialise d in helpin g enterpr ises through complex te chnology tra nsfor mation s, and wa s als o a leader in BC G’ s T ec hnolog y , M edia & T elecommunications, and People & Organiz ation pra ctice gr oups. Alison Brittain (56) Non-executive director App ointed to t he Boa rd on 1 Sep tember 202 0. Other current roles: Alison is t he Chief E xecuti ve of Whi tbrea d PLC, an d Depu ty Cha ir and a T r uste e of the Pr ince’s T rus t. Skills an d c ontribu tion: Alison i s a highly versatile business leader and gener al manager , who h olds an MB A and brin gs consi derab le exper ience of operating in consumer -f acing ser v ice envir onment s. She ha s over 25 year s' senior management experience in major ﬁnancial institu tions, and the B oard als o ben eﬁt s from h er boar d-le vel exp erie ncewit h Whi tbrea d PLC and , previ ously, Marks & Spencer Group PLC. Exper ience: Alis on was pr eviou sly with L loyds Bank ing Grou p (Group Dire ctor , Retail Di vision) and Sa ntander U K PLC (E xecut ive Dire ctor , Retail D istri bution), wh ere she wa s als o a boar d dire ctor . Sh e prev iously he ld senio r roles at Bar clays B ank, has b een a me mber of th e UK Pr ime Ministe r’s Advis or y Coun cil, was na med ‘Bu siness Wo man of the Y ear 201 7’ in th e Veuve Clic quot awar dsand was aw arded a C BE in the 201 9 UK New Year Hono urs lis t. Al ison has be en a non -exe cutiv e direc tor of Mark s & Spencer Group PLC. George Rose (69) Deputy Chairman and Senior Independent Director App ointed to t he Boa rd on 1 Sep tember 201 2, as De put y Chairma n and Senio r Indep endent Dire ctor o n 1 6 July 201 4 and a s Chairman of t he Remuner ation C ommit tee o n 2 4 July 201 9 . Other current roles: Geor ge chairs ou r Remuner ation C ommit tee an d is a non -exe cuti ve direc tor of E XP O 2020 LLC . Skills an d c ontribu tion: Geor ge is a quali ﬁed acc ountant , whose c aree r has includ ed sev eral high-level ﬁnance positions. As well as this ﬁnancial e xper tis e, he ad ds to the co llec tive str ength o f the Bo ard thank s to the nume rous non- executive positions he has held with leadin gcompa nies. Exper ience: Ge orge wa s Group Fina nce Dire ctor and Dir ect or of Financ e and T rea sur y at BA E System s plc (wher e he was a B oard me mber), and he ld senio r ﬁnance p osition s at Ley land DA F plc an d Rover Group . He was a no n- execut ive dire ctor of Nat ional Gr id plc, S A AB AB , Oran ge plc , and al so (wher e he chaire d the Audi t Com mitt ees) L aing O’Rour ke plc and G enel Ener gy plc . He has al so be en a memb er of the UK Indu strial D evelo pment Ad viso r y Board . Deirdre Mahlan (58) Non-executive director App ointed to t he Boa rd on 1 Sep tember 201 2, and as C hairman of th e Audit C ommit tee on 21Januar y 201 5. Other current roles: Deirdre chair s our Audit Com mitt ee. She is a n on- execu tive dir ecto r (and chair s the Audi t Commit te e) of The Duckhorn Por tfolio, Inc. Skills an d c ontribu tion: Deirdr e is a qualiﬁe d acc ountant wi th an MBA an d has many year s’ exp erie nce in seni or ﬁnance an d gener al management ro les. Her ﬁnancial exp ert ise and exper ience ensure eective leader shi p of our Audit C ommit tee . Deirdr e als o brin gs us the ben eﬁt s of her pr evious b oard -lev el expe rienc e with Diageo plc. Exper ience: Deir dre has hel d senior ﬁ nance and ge neral ma nagemen t roles , includin g most re cently as Pr eside nt of Diage o Nor th Am eric a, as wel l as Chief Fina ncial O cer , D eput y Chief Financ ial Oc er , Hea d of T ax and T reas ur y at Diag eo plc , Senior V ice Pr eside nt, Chief Financ ial Oc er at Diage o Nor th A meri ca, and Vi ce Pre sident of Fin ance at Dia geo Guinn ess USA , as well a s vario us senio r ﬁnance ro les in Jos eph Sea gram and S ons, I nc. and P w C. Au Nm Re Company Secretar y: Charl es Brow n FCG Independent Auditor: KPMG LLP , Chartered Acco untants an d Recognized Au ditor Au Nm Re Memb er of the Au dit Com mitt ee Member of the Remuneration Committe e Member of the Nomination and Corp orate Governance Commit tee Commi ttee Chair man Au Nm Re * Jonathan Howell’s committee memberships commenced on appointment on 1 May 2021. Code principle Board Leadership Experian plc Governance 88 Corporate gov ernance report Board Role of the director s The Board is r esponsible for setting the Company’s purpose, values and str ategy , and ensuring that the necessary resour ces are available for long-term sustainable success, to generate v alue for shareholder s and contribute to wider society . The Boar d sets the Group's strategy . In January 2021, senior management presented the pr oposed strategic plan to the Board, which had been developed to deliver strong ﬁnancial performance and build on Experian’s competitive advantages, with fundamental components around building relationships with consumers, maximising adjacent opportunities, building a high- performing and inclusive culture and achieving operational excel lence. As usual, the presentations took place over two day s. However , due to COVID-19 tr avel restrictions, the presentations wer e completed using video technology . Boar d members were pleased with the revised format, the quality of the pre-reading material and the more focused pr esentations. This year’s presentations included regional andbusiness line updates (Health, Consumer Information Services, Consumer Services and Decision Analytics). The Board also discussed with management plans to scale r egions outside the Group’s lar gest (North America, Latin America and UK and Ir eland), and technology activity to support Experian’s growth ambitions. The Board observed, in particular , the continued increase in str ategic options for the Group, the opportunities for the Health business, the plan for mar gin growth in smaller regions and the skillsets and cultur e requir ed tocontinue to drive the business forward. The Board monitors str ategy and major initiatives throughout the year (as indic ated onthe Strategic and budget planning processchart, below). The budget discussions in March ar e focused on ensuring that we have the right resour ces to deliver the agreed str ategy . These discussions include detailed focus on both regional and global business budgets. This year , the Boar d noted that the backdrop for the FY22 budget remained uncertain, with COVID-19 and the related health and economic crises continuing to disrupt global markets. The Board continually monitors management and ﬁnancial performance against the Group’s objectives. T o enable it to do this the Board receives updates, at and between every scheduled Board meeting, on oper ational and ﬁnancial matters as well as any major initiatives underway . Given the challenges of COVID-19, the Board r eceived an increased number of ‘between meeting’ updates this year , to allow for appropriate ov ersight and monitoring. F or example, as well as the usual monthly Board Finance Report, the Chief Executive Ocer provided additional updates tothe Board on latest ﬁnancial performance, forec asts and trends, and certain other operational matter s. The Board also conducts post -investment reviews on an agr eed timeline, for any acquisitions it has previously appr oved. Y ou can read about the Boar d’s procedur es tomanage risk, over see the internal control framework, and determine the nature and extent of the principal risks the Company is willing to take to achieve its str ategic objectives, under Risk management and internal control systems review on page 110. The Board delegates management of the Group’s day -to-day activities but is accountable to shareholders for deliv ering ﬁnancial performance and long-term shareholder v alue. T o achieve this, the Boar d has put in place a framework of contr ols, including clear and robust pr ocedures and delegated authorities, which enables the Group to appr aise and manage risk eectively . This fr amework is illustrated in the Gov ernance framework diagram on page 93. In addition, the Boar d has reserved decisions about certain key activities to itself , including: A. Strategy and management – approval and oversight of Experian’s long-term objectives and commercial str ategy , appr oval of annual operating and c apital expenditure budgets, and oversight and monitoring of oper ations. B. Structure and c apital/Financial reporting and controls – changes in the Group c apital or corporate structur e. Approval of the Gr oup’s results, dividends, dividend policy , signiﬁcant changes in accounting policy , tax policy and treasury policy . C. Contr acts – approval of major or str ategic capital pr ojects, and of major acquisitions anddisposals. D. Communication – approval of key stakeholder documents, circulars, prospectuses, and reviewing investor sentiment. E. Board member ship/Delegation of authority/Corporate governance/P olicies – approv al of changes to Board composition, ensuring adequate succession planning, reviewing r eports from Boar d committees, reviewing governance arr angements, and approv al of various policies. Details of the activities of the Board during the year under these headings are on page 90. A high-level statement of the types of decisions that have been delegated by the Board is sho wn in the ‘Governance fr amework’ diagram on page 93. * Including two days of strategy pr esentations. March Board budget review July to August Strategic planning March to May Preliminary steps January Board str ategy review * June Group Operating Committee review meeting October to November Financial planning and prioritisation July Board strategy mid- year review September Internal revie w Strategic and budget planning pr ocess Code principle Board Leadership and Company Purpose 89 Experian plc Annual Report 2021 Gover nance April Board meeting May Board and committee meetings June Board meeting July Board and committee meetings September Board and committee meetings Novembe r Board and committee meetings January Board and committee meetings Feb rua ry Board meeting March Board and committee meetings 2020 2021 Ad -ho c Bo ard me etin gs The Board meets suciently fr equently to discharge its duties, and holds additional meetings when requir ed. This year , f or example, the Boar d met to speciﬁcally discuss the impact of the COVID-19 global pandemic from a number of perspectives, including liquidity and funding, oper ational resilience, governmental and societal support, and people. Nine Boar d meetings were held during the year , thr ee of which were ad-hoc meetings. Scheduled meetings are normally held over two to three days, with Board committee meetings also taking place during this time. The Board continued to oper ate eectively during the year utilising video technology and the Board r etained its cohesive and collegiate culture. Ther e is no doubt that the pandemic has changed ways of working for many people and organisations acr oss the world, and the Chairman, Chief Executive Ocer and Company Secretary will continue to r eview optimal ways to oper ate the Board on an ongoing basis, as cir cumstances dictate. Attendance at Board and principal committee meetings Board Nomination and Corporate Governance Committee Remuneration Committee Audit Committee Directors as at 31 March 2021 Mike Rogers 9/9 – 100% 4/4 – 100% 6/6 – 100% n/a Brian Cassin 9/9 – 100% n/a n/a n/a Lloyd Pitchford 9/9 – 100% n/a n/a n/a Kerry Williams 9/9 – 100% n/a n/a n/a Dr Ruba Borno 9/9 – 100% 4/4 – 100% 6/6 – 100% 4/4 – 100% Alison Brittain (appointed 1 September 2020) 5/5 – 100% 3/3 – 100% 4/4 – 100% 3/3 – 100% Caroline Donahue 9/9 – 100% 4/4 – 100% 6/6 – 100% 4/4 – 100% Luiz Fleury 9/9 – 100% 4/4 – 100% 6/6 – 100% 4/4 – 100% Deirdr e Mahlan 9/9 – 100% 4/4 – 100% 6/6 – 100% 4/4 – 100% George Rose 9/9 – 100% 4/4 – 100% 6/6 – 100% 4/4 – 100% * Includes three ad-hoc Board meetings held during the y ear Board meetings Code principle Board Leadership and Company Purpose Experian plc Governance 90 A. Str ategy and management Evaluated and debated presentations fro m managem ent durin g the t wo- day strateg y presentations, and approved the Group’ s s trategy update. Rec eived an d consid ered t he key initiat ives an d str ategy up date as par t of the on going s trate gic plan ning cyc le. Reviewe d operatio nal and ﬁnancial update s fro m the Chief E xecu tive O cer , the Ch ief Ope rating O ce r and the Chi ef Financial O cer at each schedule d Board me eting – this y ear , par tic ularly in t he ﬁrs t half, the B oard was p rovi ded wi th signiﬁ cant det ail on the Gr oup’ s contin uing r e s p o n s e t o C O V I D -19. Review ed monthly re por ts , including deta ils of p er forman ce agains t budg et and the Group’s ﬁnancial position and stake holder upda tes, plus a dditional out- of-c ycle rep or ting an d updates d ue to C O V I D -19. Revi ewed and d iscus sed re gulato r y and complia nce matters with the Group Gen eral C ounsel a t Boar d and Audit Com mitt ee mee tings, in cluding up dates on ongoing engagement, current issues , pote ntial impac ts an d plans . Revi ewed th e ongoin g invest igation into a potential non-sensitive data incident in Braz il. Revi ewed and a pprove d risk ap peti te statement s for the Group. B. Structur e and capital/Financial reporting and c ontrols Approved the Gr oup’s Annual Report and full-y ear and half-year ﬁnancial r esults and car efully considered dividend payments. Approved the r eﬁnancing of existing borrowing facilities, the issue of bonds, and delegated authority that would ensure ﬂexibility regar ding ﬁnancing between Board meetings while markets r emained volatile. Discussed and approved the Gr oup’s budget presentation for FY22 and r eceived updates on Group insur ance and pension arrangements. Considered and appr oved the Viability statement for inclusion in the Annual Report. Reviewed risk reports, the appropriateness of preparing the ﬁnancial statements on the going concern basis and the Audit Committee’s advice on making a ‘fair , balanced and understandable’ (FBU) statement in the Annual Report. C. Contr acts Reviewed and approved several strategic acquisi tions, inc luding: – T apad , Inc., a l eading pr ovid er of digital identit y serv ices. – A xesor bus inesses, one o f S pai n ’ s Busine ss Informati on leaders . – B rSc an, a lea ding pla yer in the id entit y and f raud mar ket in Bra zil. – C orp orate C ost C ontrol , a leadin g prov ider of w orkf orce s olution s in the USA , as the G roup loo ks to bro aden it s employer and veriﬁcation solutions oering. – E mploym ent T ax S er vicing , LLC , a leader in veriﬁcation of employment and inc ome in the US A which pr ovide s enterprise -level workf orce management solutions complementing huma n resources a nd payroll administration. – T ax Cre dit Co ., LLC a l eading pr ovid er of veriﬁc ation of employment and of inco me and hir ing and re searc h tax credit te chnology and adminis tration . Ap prove d the disp osal of E xpe rian’ s inves tment in F inicit y to Maste rC ard. Revi ewed and d iscus sed th e corp orate deve lopment p ipelin e at each B oard meeting. D. Communication Reviewed investor relations, exter nal commu nicatio ns and me dia update s at each sched uled Board meeting, a nd disc usse d the pos itive b rand imp act of th e Nor th America Co nsumer Serv ices busine ss. Reviewed and discussed draf t full-year and half-year ﬁnancial result s pre senta tions fo r analyst s and institutional shareholders , and noted inves tor sent iment re garding th e Boar d and senior management. Thro ugh the Remuneration Commit tee, engaged ex tensively with s hareholders on propose d remuneration arrangement s. E. Boar d membership/Delegation of authority/Corporate go vernanc e/ Policies Reviewed the Group’s Gifts and Hospitality Policy , and consider ed the annual environmental, and health and safety , updates and approved associated policy statements. Reviewed Board ev aluation ﬁndings and agreed ar eas of focus, authorised Board members’ potential conﬂicts of interest and approved the annual election and re-election of Boar d members. Considered and appr oved the Notice of Annual General Meeting (A GM) for issue to shareholders, and the arrangements for the 2020 AGM due to COVID-19. Reviewed and approved the appointments of Alison Brittain and Jonathan Howell as independent non-executive director s of the Company . Reviewed and discussed the annual corporate r esponsibility update from the Global Head of Corporate R esponsibility . Received details of Board members’ external appointments and share dealings. Reviewed and approved the Gr oup’s tax and treasury policies, and appro ved the Group’s Code of Conduct. The Board’s ke y activities during the year A. Strateg y and management B. Stru cture and capital /Financial repor ting and control s C. Contra cts D. C ommunication E. Boar d membership/Delegation of authority/ Corp orate go vernance/Policies F. O t h e r A B C D E F Corporate governance r eport contin ued What did the Board do this year? Code principle Board Leadership and Company Purpose 91 Experian plc Annual Report 2021 Gover nance Cultur e The UK Corporate Gov ernance Code emphasises the importance of the role of the Board r egarding cultur e, with speciﬁc recommendations that the Boar d assesses and monitors culture, and ensures that workforce policies, pr actices and behaviours are aligned with the Company’s purpose, values and strategy . The Experian Wa y , which lays out a globally consistent set of expectations within the business across ﬁve str ategically important areas, is underpinned by the following Principles – Integrity , F airness, Data Security and V alue. These Principles help us to create a vibrant ethic al performance culture. We continue to believe that culture is embedded throughout an or ganisation, r ather than, for example, in isolation within a set of Boar d metrics. W e are conﬁdent that the information the Board and its committees r eview , the activities that Board members engage in, and Experian’s existing structures and pr ocesses, mean that Experian and the Board ar e meeting the recommendations of the Code. Last year’s external Board eectiveness evaluation noted that there w as an excellent focus on Board cultur e, employee engagement and developing talent, with opportunities (in normal times) for the Board to meet Experian’s people, assess potential and see cultur e in action. The evaluation report also noted that the Board r ecognises the importance of values and culture in what Experian has deliver ed to date and is leading by example in the way it acts and engages. One of the primary ways we believe the Boar d can experience, assess and evaluate cultur e is through meeting with colleagues thr oughout the business, as it does in normal y ears. A notable example of this was 2019 when the Board attended a number of engagement events at our North America oper ational headquarters in Costa Mesa, California, including a ‘Power of Y ou’ lunch event focused on culture, diversity and inclusion, attended by a large number of employees and repr esentatives from man y of Experian North America’s Employee Resour ce Groups (ERGs). With COVID-19, it has not been possible for the Board to engage with our people in the same way this year . Prior to the pandemic, the Board had planned to hold meetings during the year at our operational headquarter s in Brazil and North America, and engagement events would have been planned around those Boar d visits. The Board also planned to spend time at the Group’s Customer Innov ation Experience in London, which aims to bring our business propositions and innov ation to life, and pr ovide an insight into customer and consumer interactions with the business. Given the constraints this y ear , the Boar d has regularly been kept apprised on people-r elated and cultural matter s. The pandemic took hold in March 2020 and, as reported last y ear , the Board agr eed COVID-19 priorities and goals, which included the safety of employees and the use of the Group’s c apabilities to help communities survive and recover r apidly . The April 2020 ad-hoc Board meeting was COVID-19 focused and, fr om a cultural perspective, the Board hear d that morale was good acr oss the business and that employees were coping well working from home. The level of employ ee communication and support pr ovided by the business was very high, and the Boar d was updated on the small number of conﬁrmed COVID-19 cases among employees. The Board was also reminded of the 'people ﬁr st' approach being taken by the business, with the priority being to protect Experian’s people and their jobs as far as possible through the crisis. This was well received by employ ees, and r eﬂected the Group’s long-term investment in its people and its talent agenda. The People updates from the Chief Executive Ocer to the Board at each scheduled meeting were a cor e focus of his reporting to the Boar d, particularly in the early stages of the pandemic. F or example, in May 2020, the Board considered the results of a sentiment survey , which indicated the concern and uncertainty of employees, but that there was optimism also and employees were pleased with the Experian response. Employee concerns wer e acknowledged and acted upon, including around technology , tools and the variety of challenges facing them (such as isolation, competing demands, working en vironments, and physical and mental well -being). As the pandemic continued, and mindful of a people and culture perspective, the Group Operating Committee considered the r eturn of employees to our oces (it was explained to employees that they would have the choice to return when they felt comfortable) and longer-term futur e ways of working, where employ ees would have increased ﬂexibility and choice in their work arrangements such as loc ation and hours. In addition, during the y ear , all of our female Board members (Dr Ruba Borno, Alison Brittain, Caroline Donahue and Deir dre Mahlan) participated in a panel session as part of our globalcelebration ofInternational W omen’s Day in March 2021. TheW omen in Experian group organised a series of events, with activities including a W omen in Experian mentoring progr amme, leadership panels with featured keynote speakers, personal and professional development sessions, and community outreach. As well as this, the Board did continue to interact with employ ees as much as possible during the year: for example, all of the Group Operating Committee attended the str ategy presentations with the Boar d in January 2021, and the Board met with members of our global and Consumer Services communications teams in November 2020 to discuss the integration and support of the Experian brand by the Consumer Services business. Code principle Board Leadership and Company Purpose Experian plc Governance 92 Delight custom ers Innovate to gro w Collab orate to wi n Safeguard our future Val ue eac h other At Experian, whether y our role brings you into contact with customers directly or not, all of us contribute to meeting customer needs. At the heart of what we do are the relationships we invest in and nurture. At Experian, it’s the responsibility of each one of us to ﬁnd opportunities and improve the way we do things to help our business and our customers grow . One Experian mindset – we work as one united team and use the combined strengths and capabilities of our people, pr oducts and services across teams, functions and regions. This translates into seamless experiences for our customers. At Experian, each of us acts as a guardian for the protection of data, information, assets and our people to safeguard our future. We mak e Experian a great place to work. W e treat each other with respect, trust and integrity . The Experian W ay is a unique and consistent way of working globally . It informs how our people act and behave, which shapes our culture. It is deﬁned across ﬁve ke y areas of str ategic importance: Corporate governance r eport contin ued The Experian Way Who What The Board The Chief Executive Ocer’s report, cir culated before every scheduled Board meeting, contains a speciﬁc People update, which includes cultur e. The Board r egularly considers the r esults of employee sentiment surveys. Annually reviews the Gr oup’s Code of Conduct. This explains our approach to pr ofessional and ethical standards, and ensures that Experian’s employees know e xactly what’s expected from them in helping Experian live up to those standards. All employees must undertake annual tr aining. Board members Visiting Group business locations enables the Boar d to spend time with employees of varying seniority and assess culture in a loc al context. Although this has not been possible due to COVID-19 tr avel restrictions, it remains a key consideration that the Boar d has the ability to engage in this way with the business. Audit Committee Overviews of inter actions with government, r egulators and the perspective provided by Global Internal Audit can giv e an indication of cultur e. The Committee and the Board r eceive relev ant updates at every meeting. Management is transpar ent and responsive to challenge. T wice a year , the Committee review s calls made to the Conﬁdential Helpline. Remuneration Committee Reviews an ‘Overview of employee pay’ paper , designed to provide an overview of pay structures at Experian and their alignment with our purpose, v alues and strategy . This allows the Committee to ensur e that relevant policies and practices ar e consistent with Experian’s values. The Committee Chairman met virtually with the UK and Ireland Experian People F orum in the UK and Ireland in March 2021, and feedback was pr ovided to the Board. Reviews our UK gender pay gap disclosur es every year , on behalf of the Board. Nomination and Corporate Governance Committee In January , the Committee discussed a People Str ategy , T alent and Culture update with the Chief People Ocer , which included details of strategic pillar s and key risks, people implications, global people str ategic focus areas and the positive progr ess of talent and culture initiatives. Examples of ways that the Boar d monitors and assesses culture Code principle Board Leadership and Company Purpose 93 Experian plc Annual Report 2021 Gover nance Global Delegated Authorities Matrix This key Group go vernance document comprises the schedule of matters reserved to the Board, the Board committees’ terms of refer ence and the authority levels for the Group’s principal subsidiaries, director s and senior executives. For matter s not reserved to the Board, the matrix prescribes the cascade of authorities delegated throughout the Gr oup by respective Gr oup companies, together with their monetary limits. The Board monitors the ex ercise of delegations to the Group’s principal subsidiaries, which ar e reported to it at each Board meeting. Regional matrices ar e also in place. Delegated authority ﬂow Board committees Executive committees/functions Board Executive management team Operating businesses Principal subsidiaries These are Gr oup companies to which the Board has delegated certain decision-making powers, for example implementing decisions agreed in principle by the Boar d; executive management of the oper ations of the Group within the strategy and budget appr oved by the Board; acquisitions and disposals with a value up to US$20m, and capital expenditure pr ojects. See Board of directors on pages 86 to 87 Group Operating Committee (OpCo) Strategic project committees (global and r egional) Global Internal Audit Risk management committees (executive and r egional) Nomination and Corporate Governance Committee Audit Committee Remuner ation Committee See report on page 99 See report on page 104 See report on page 111 The OpCo comprises the most senior executives from the Group. Its remit includes identifying, debating and achieving consensus on issues involving str ategy , growth, people and culture, and operational eciency . It also focuses on ensuring strong communication and co-oper ative working relationships among the top team. Its meetings tend to be issues oriented and focus on selected Group issues worthy of debate. These committees comprise the most senior global and regional executives. Their r emit is to oversee a process to ensur e that all strategic projects ar e appropriately r esourced, risk assessed and commercially , ﬁnanciall y and technically appr aised. A similar body , the Investment Committee, performs the same function in respect of pr oposals regar ding minority investments. Depending on the outcome of the discussions, the committees’ conclusions ar e then considered by the boar d of the relev ant Group company for appr oval. Gl obal Inte rnal Au dit (GIA ) con duc ts a ra nge of in depe ndent au dit rev iews t hroug hout th e Gro up durin g the ye ar and is re pres ente d at each Au dit Co mmit tee m eetin g. GIA’ s plan s, re sults and ke y ﬁnding s are pre sent ed to, an d discus se d with , the Audi t Comm itt ee. T he inter nal audi t pro gramm e and met hodo logy a re alig ned to th e risk c ateg orie s and ri sk ass es sment pa rame ters e stab lishe d by Glob al Risk Mana gemen t. GIA a ls o makes us e of risk ass es sment inf ormat ion at a bu sines s level , in pl anning an d condu ctin g its a udit s. Executive Risk Management Committee (ERMC) comprises senior Group executives, including the executive director s and the Company Secretary . Its primary r esponsibility is to oversee the management of global risks. The regional risk management committees o versee the management of regional risks, consistent with Experian’s risk appetite, strategies and objectives, and ar e comprised of senior regional leader s. Security and Continuity Steering Committee (SCSC) is a sub-committee of the ERMC. The SCSC’s primary responsibility is to oversee management of global inf ormation security , physical security , and business continuity risks, consistent with Experian’s risk appetite, strategies and objectives. Assurance Steering Committee (ASC) is also a sub-committee of the ERMC and oversees the development and implementation of the Group's assur ance fr amework. Governance fr amework Code principle Board Leadership and Company Purpose Experian plc Governance 94 1 April 2020 12 M a y Dublin 22 Jul 31 M ar c h 20 21 Apr il 21 , 22, 26, 27 & 2 8 May 1 , 2, & 3 Ju ne 1 8, 19 , 20, 23, 24 & 25 Nov Nov 21 Ju l 16 S e p 11 N o v 28 Jan 23 Mar Remuneration engagement Inve sto r vir tua l conf eren ces a nd me etin gs Inv esto r and m edia r elat ions r epo r ts pr ovi ded to t he Bo ard AGM Shareholder and stakeholder engagement The Code encourages companies and boar ds, including committee chairs, to seek regular engagement with major shareholders in or der to understand their views. Boards ar e also encouraged to ha ve a clear understanding of the views of shareholder s. In addition, the Code states that the Boar d should understand the views of the Company’s other key stakeholders and describe how their interests have been consider ed in discussions and decision-making. Details r egarding k ey stakeholders ar e on page 95. Shareholder s We ar e committed to open and regular communication and engagement with shareholders at an y time of the year , and our communications with them will always oer invitations to meet with the Chairman or any of the Board’s committee chairs. Board – Investor relations and e xternal communications and media r eports are circulated befor e every Board meeting. The investor relations r eport contains a commentary on recent market events, share price performance, in vestor feedback, analyst recommendations and investor r elations activities. The external communication and media report was a new r eport this year , with existing media reporting expanded to pr ovide detail of upcoming communications campaigns, key issues, media cover age and spotlights on various issues (for example, the naming of Experian North America as #1 T op Workplace by the Orange County R egister for dedication to culture). The Chief Communic ations Ocer provides r egular updates at Board meetings. Engagement with investors – The Chairman of the Remuner ation Committee wrote to our major shareholders and the main UK and US proxy advisory bodies twice this y ear . In April 2020, he pr ovided an update on the Gr oup’s proposed appr oach to remuner ation, ahead of the AGM, speciﬁcally in r elation to proposed enhancements to the Directors’ r emuneration policy . In November 2020, he pro vided an update on the 2020 long-term incentive plan (L TIP) tar gets, which the Committee had delayed setting and disclosing until there was more clarity on the business impact of COVID-19, and which were disclosed to the market in November 2020. He also provided a further update to investors on the impact of COVID-19 on our business and key stakeholders, and shared further insights on how we have supported our people during the pandemic. As always, the Chairman is available to meet with investors and did so virtually during the year (while complying with COVID-19 restrictions), as did the Audit Committee Chairman, to discuss a wide r ange of issues, including how Experian was handling the pandemic, sustainability , information security , risk matters and external audit. Investors and analy sts – The executive team runs an ongoing progr amme of dialogue with institutional investors and analysts, through which they discuss a wide range of issues including strategy , performance, management and governance. Experian also engages with investors thr ough industry conferences and by hosting events with members of the senior management team. The announcements of the annual and half-year r esults and trading updates provide opportunities for us to answer questions from analysts, covering a wide range of topics. This year , ex ecutive management attended virtual conferences and inv estor meetings in May and November 2020. Annual General Meeting – The A GM provides a valuable opportunity for the Boar d to communicate with shar eholders and, in normal years, to meet them informally befor e the main business of the meeting. In r esponse to COVID-19, restrictions had been intr oduced by the Irish Government in relation to tr avel and public gatherings at the time of the 2020 AGM. T o comply with these restrictions and public health advice, and in or der to ensure the saf ety of the Company’s shareholder s, employ ees and directors, shareholders were not permitted to attend the Company’s 2020 AGM. However , we invited shareholder s to submit questions, and we also engaged with investors in r elation to AGM voting. After the AGM, we updated the Experian website with a document summarising the themes of the questions that had been received fr om shareholder s. Voting levels at the AGM wer e 76.24% of the Company’s issued share c apital. The 2021 AGM will take place on W ednesday 21 July 2021 in Dublin, Ir eland, and the speciﬁc arrangements for this y ear’s meeting (in the context of COVID-19) are outlined in the Notice of AGM which has been sent to shar eholders or appears on the Experian website, www .experianplc.com. W e encourage shareholders to use pr oxy voting on the resolutions put forwar d, all of which (except for procedur al resolutions) will be taken by a poll. Private shareholders – The Company Secretary , Charles Brown, oversees communication with private shar eholders, and ensures dir ect responses as appr opriate in respect of any matter s raised by shar eholders. The Company issues a ‘Shareholder Questions’ car d each year , together with the A GM documentation. As well as placing the themes on our website this year , Charles Br own responded to shar eholders directl y , as appropriate, following the meeting. Investor relations app – This contains information about our ﬁnancial performance, together with reports, presentations and new s of upcoming events. W ebsite – Our website is an important channel for communicating with all stakeholder s, including shareholders. All material information reported to the r egulatory news services is published at www .experianplc.com/investors/ regulatory -news together with copies of annual and half-year r esults announcements and trading updates. Timeline of shareholder engagement Corporate governance r eport contin ued Code principle Board Leadership and Company Purpose 95 Experian plc Annual Report 2021 Gover nance Stakeholder Responsibility Relevant activities during FY21 Summary of stakeholder views/actions Board The Boar d report in Mar ch includes an update on clients and consumers, including (for client) Net Promoter Scor e (NPS) metrics, top-performing NPS attributes and areas that r equire improvement. On consumers, the reporting includes brand awar eness, trust in the Experian brand and the level of complaints. There had been a signiﬁcant increase in Experian’s NPS, and Experian’s reputation as a trusted company continued as the highest scoring brand attribute, for the ﬁfth year in a row . Client satisfaction had increased for every journey touchpoint with high ratings in account relationship management. In response to the COVID-19 pandemic, clients felt that Experian partner ed well with them and provided the vital support and solutions they needed to adapt to their new challenges. There had been improvements in br and trustworthiness, and a decrease in complaints in the USA and Brazil. Board The Chief Executive Ocer reports on corporate r esponsibility at each scheduled Board meeting. At least once a year , the Global Head of Corporate Responsibility pr esents to the Board. Highlights this year included our response to COVID-19, supporting vulner able communities, our impact in FY20 and our commitments. The Board noted and supported the actions being taken in r esponse to COVID-19, including: – Helping vulnerable communities with charitable donations, donations of per sonal protective equipment, over 3,500 hours of volunteering in Mar ch 2020, pr ovision of products, tools and education r esources, and work with regulators to ensur e that credit scor es remained unaected by payment holiday s. – Scaling of global eorts to drive our ﬁnancial education r ecovery progr amme, United for Financial Health. – The Board was updated on the work completed during FY20 to amplify the Group’s societal impact, which included 13.8 million more people r eached through the Group’s Social Innovation pr oducts, 54,500 hours of volunteering, and an 8% reduction in the Gr oup’s carbon footprint. The Board supported the Group’s commitment to becoming a carbon neutr al business in our own operations by 2030. Board, Nomination and Corporate Governance Committee, Remuneration Committee Pulse survey updates to the Board. Board reporting at every scheduled Boar d meeting (COVID-19 and Human Resour ces sections of Board r eport). People Strategy , T alent and Cultur e update to the Nomination and Corporate Governance Committee. Direct feedback to the Board fr om George Rose, R emuneration Committee Chairman, who met virtually with the UK and Ireland Experian People F orum in the UK and Ireland in Mar ch 2021. Conﬁdential Helpline updates to the Audit Committee. The Board was updated and considered the actions taken in r esponse to our various COVID-19 sentiment surveys: – Clear communication around business outlook, approach to job protection and ﬁnancial impact. – The approach to equipment access and r eimbursement for critical work items. – Well -being and resilience support. – Continued focus on Experian’s role as a socially r esponsible employer . The Nomination and Corporate Governance Committee was updated on the ﬁve global people strategic focus ar eas in response to insights from employees. These focus areas included pr eparing Experian for further growth, putting people ﬁrst in order to cr eate a compelling employee experience, and growing world-beating technology leaders. Board Annual update to the Board on suppliers, which includes details of engagement, the Group’s Supplier Relationship Management progr amme (SRM) and supplier views. Annual Board review of the Gr oup’s Modern Slavery Statement. Views of Experian colleagues and suppliers are surveyed on a r egular basis to give a full picture of key r elationships. The results ar e used to highlight areas of focus for relationship development. Experian runs a collaborative global SRM progr amme with its suppliers, which includes: – Executive sponsorship to ensure two-way communic ation at a strategic level. – Regular forums for dialogue in quarterly business reviews. – Periodic 360-degree surveys to understand supplier s' views. – Maturity model to gauge the maturity of each relationship and identify next steps toprogr ess. Board, Audit Committee Board members receive r egular Board and Audit Committee updates from the Gr oup General Counsel r egarding r egulatory engagement, and any ongoing r egulatory matters. There is ongoing Compliance reporting to the Audit Committee, including Compliance training. Audit Committee Risk Management reporting includes legislative/r egulatory matters. An y relevant go vernment aairs matters are also consider ed by the Audit Committee and the Board. During the year , a Group subsidiary , Experian Limited, received an enfor cement notice from the UK Information Commissioner's Oce (ICO) in relation to the marketing services Experian provides in the UK. The contents of the notice and views of the ICO were consider ed, and a decision w as made to appeal on the basis that the Group considers the ICO’s view to hav e gone beyond the relev ant legal requir ements. The Board and Audit Committee have been r egularly apprised on this matter during the year . There were ongoing r egulatory inquiries in respect of other matters during the year , and the Board and Audit Committee r eceive regular updates on the matters being considered by r egulators. Our r esponse to these inquiries will also take into consideration the r egulatory position on the relev ant inquiry . Our client s and consumers Our communitie s Other stakeholders Further information concerning Gr oup-wide engagement with key stakeholders is on pages 24 and 25 in the Strategic r eport. Board activities r egarding key stakeholders, including engagement, are summarised in the table below . Shar eholder engagement has been considered earlier . Our peo ple Our suppliers Gover nments Code principle Board Leadership and Company Purpose Experian plc Governance 96 W orkforce engagement The Code requir es companies to select one or a combination of prescribed methods for the Board to engage with the workfor ce. If a particular method is not appropriate for a company , it may explain the alternative arrangements in place and wh y these are considered eective. The Experian Board has always felt well informed about workfor ce views and matters, including in relation to pay and related policy arr angements for the broader employee population. As a result, no single approach r ecommended in the Code was considered appr opriate for our business. The Board instead adopted a combination of methods to comply with the Code’s requir ements. These are summarised below , and include: There ar e regular people and sentiment survey updates to the Board (including COVID-19 speciﬁc surveys this year), and reporting at every scheduled Boar d meeting on people matters. People, talent and cultur e updates are also pr ovided to the Nomination and Corporate Gov ernance Committee, oering a valuable insight into workfor ce matters. Any relev ant business cases r eviewed by the Board include an ev aluation of potential impacts of the transaction on the Group’s stakeholder s, including employ ees. The Remuner ation Committee annually considers an extensive paper setting out details of all-employee pay and workfor ce policies across Experian. The discussions on this topic provide helpful insights for fr aming pay considerations. The Remuner ation Committee Chairman annually attends a meeting of the UK and Ireland Experian People F orum (see Our people, in the table on page 95), providing the opportunity to gain ﬁrst-hand feedback in two-way discussions with the workfor ce, which is invaluable. The employee insights and views gathered ar e shared with the full Board, allowing the Boar d to hear directly from the wider workfor ce. In normal years, the Board would meet with employees physic ally outside the Boardr oom environment. Clearly , COVID-19 has impacted on the Board’s ability to engage in this way during this year . In coming to this approach, the Board debated updates from management on the implementation of the UK Corporate Governance Code, and the inf ormation it already received and r eviewed regar ding the Experian workforce, and was satisﬁed that the approach was appropriate for Experian and that the Board keeps workf orce consider ations to the fore in its deliber ations. Considering our stakeholder s in our decision-making The Code also recommends that the Boar d should describe how stakeholder interests have been considered in Boar d discussions and decision-making. W e have processes in place to captur e and consider stakeholders’ views (including the matters contained in Section 172 of the UK Companies Act 2006, on a voluntary basis) and feed them into Board decision- making. All material business cases consider ed in the Group (for example, mergers, acquisitions and major capital investments) include an analy sis of the stakeholder consider ations, anticipated impact and mitigations. This process, which has been reinfor ced, helps the Board to perform the duties outlined in section 172 of the UK Companies Act 2006 and provides assur ance to the Board that potential impacts on stakeholders have been consider ed in the development of the proposal. An example of how this process work s in practice is outlined below , where Boar d consideration of a str ategic acquisition included a review of the standing stakeholder impact analysis. Acquisition of Ax esor in Spain In November 2020, the Boar d reviewed, considered and appr oved the acquisition of Axesor , one of the lar gest independent business information (BI) provider s in Spain. The acquisition of Axesor’s well-established BI data assets allows the enlarged business to oer a highly dierentiated consumer information 'one-stop' proposition to new and existing customers in Spain. Spain is a core and strategic mark et for Experian EMEA, and the transaction pr ovides Experian with a more diverse, scaled and r esilient business, beneﬁtting from enhanced and highly complementary customer cover age. There is also the opportunity to realise substantial cost synergies. A brieﬁng paper was circulated to the Boar d ahead of its November 2020 meeting, outlining the strategic r ationale for the transaction, as well as the ﬁnancial evaluation and deal structure. The Gr oup’s Chief Investment Ocer attended the meeting and presented the business case to the Boar d. The Board noted that Axesor aligned with Experian global BI strategic priorities and that Experian would integrate administr ative, ﬁnancial, and HR functions. In considering the acquisition, the Boar d reviewed the stakeholder impact analy sis which had been prepar ed (and which is prepar ed for all acquisition business cases). The analysis identiﬁed the following stakeholder impacts and actions/mitigations: Evaluation of the acquisition indic ated that the combination of the two businesses would enhance the innovation, quality and completeness of product oerings in Spain. The transaction pr ovides exciting gr owth opportunities for both the Axesor employee base and the Experian Madrid employees. Initiatives would be implemented across the combined organisation to optimise eciencies and protect our Benchmark EBIT . Employees of the combined organisation as well as the W orkers Council will be engaged to ensure a smooth and optimal cultur al integration. The integration plan for the business considered the alignment of suppliers. There was some customer crossover , for which combined management plans were made. The acquisition was expected to have a meaningfully positive long-term impact on all relevant stak eholders, and no material community or environmental impacts were anticipated. W orkforce policies and pr actices The Board is expected to ensur e that: workforce policies and pr actices are consistent with the Company’s values; that they support its long-term sustainable success; and that the workforce c an raise an y matters of concern. An example of the alignment of policies and practices is how the Gr oup manages anti-bribery and anti-corruption. Experian has a strong compliance cultur e, which is at the heart of our strategy for ensuring we compl y both with the laws that apply to our business and with our Global Code of Conduct. The Board sets the tone and leads by example and is one of the most important inﬂuences on the Company’s commitment to preventing bribery and corruption. Our Anti-Corruption F ramework sets out our zero-toler ance policy on bribery and corruption in any form, and this message is reinfor ced through mandatory annual tr aining for employees. W e also extend this framework to our thir d-party network and business partners, which helps to instil our values in every aspect of our business. W e apply due diligence and car eful screening to intermediaries such as agents, r epresentatives, resellers and service pr oviders and train them in our policies. Corporate governance r eport contin ued Code principle Board Leadership and Company Purpose 97 Experian plc Annual Report 2021 Gover nance The Code principles regar ding the role of the Chairman, the desired characteristics of the Chairman and his duty r egarding Boar d relations and contributions are outlined in the Chairman’s letter of appointment. A summary appears in the table below . The table also summarises how there is a clear division of responsibilities between the leadership of the Boar d and the executive leadership of the business. Chairman Running the Board eectively and ensuring that the Board play s a full and constructive part in developing and determining the Group’s str ategy and over all commercial objectives Promoting the highest standards of integrity , pr obity and corpor ate governance throughout the Gr oup and particularly at Board level Ensuring that the Board receives accur ate, timely and clear information on the Group’s performance and its issues, challenges and opportunities Ensuring eective communication with the Company’s shareholders by the CEO , the CFO and other ex ecutive management; and ensuring that the Board develops an understanding of the view s of the Company’s major shareholder s Facilitates the non-e xecutive directors’ eective contribution to the Boar d, and ensures constructive r elationships between the executive and non-executive dir ectors Primarily responsible for the Board’s leader ship and governance, ensuring its eectiveness Chief Executive Ocer Responsible for the Group’s day-to-day business, in line with the strategy , risk proﬁle, objectives and policies set by the Board and its committees Accountable to the Board for the Group’s development and its oper ations Running the Group’s business and developing the Group’s str ategy and overall commercial objectives Implementing, with the executive team, the decisions of the Board, its committees and the principal subsidiaries Maintaining a dialogue with the Chairman on the important and strategic issues facing the Group, and alerting the Chairman to forthcoming complex, contentious or sensitive issues Leading the communication progr amme with shareholders Chairing the Group Operating Committee Chief Financial Ocer Responsible for managing the ﬁnancial aairs of the Group, including tax, corporate ﬁnance and tr easury Works closely with the CEO and COO to manage the Gr oup’s operations Member of the Group Operating Committee Chief Operating Ocer Oversees the Company’s business operations, including information security Ensures the Group has eective oper ational procedures and controls Responsible for driving the evolution of the Group’s technology and innovation str ategy Member of the Group Operating Committee Senior Independent Director Provides support and guidance, acts as a sounding boar d for the Chairman, and serves as an intermediary for other directors Acts as a contact point for shareholders if they have concerns which ar e not resolved thr ough discussion with the Chairman, CEO or CFO Evaluates the performance of the Chairman Non-executive directors Constructively challenge and help develop Group str ategy Scrutinise management performance against agreed goals and objectives Uphold the highest standards of integrity and probity and support the Chairman in instilling the appr opriate culture, values and behaviours in the Group Ensure the integrity of ﬁnancial information and that there ar e robust ﬁnancial contr ols and systems of risk management; determine executive remuner ation and succession planning Group Company Secretary Secretary to the Board and its committees Provides support and guidance to the Board and the Chairman, and acts as an intermediary for non-executive directors Responsible for: corporate governance; listing rules, prospectus rules, and disclosur e guidance and transpar ency rules compliance; statutory compliance and reporting; shar eholder services; and corporate r esponsibility Member (and secretary) of the Group Oper ating Committee Group General Counsel Responsible for overseeing Experian’s global legal, risk management, regulatory compliance and government aairs functions Provides the Board and Audit Committee with legal advice, leads on legal, risk and regulatory reporting, and active in public policy advocacy Member of the Group Operating Committee Division of responsibilities Code principle Division of Responsibilities Experian plc Governance 98 W orkforce policies and pr actices (continued) In terms of the ability to raise matter s of concern, Experian is committed to achieving the highest possible standards of quality , honesty , openness and accountability , and ther e is an expectation that employees maintain high standards in accor dance with the Global Code of Conduct. There is also a cultur e of openness and accountability , and all employees ar e encouraged to r aise any concerns about the way in which the business is run at an early stage so that any concerns can be dealt with eectively . A conﬁdential helpline, facilitated by an external provider , has been set up for employees who wish to r aise any concerns. Calls to the Conﬁdential Helpline, and an y actions requir ed, ar e reviewed by the Audit Committee at least every six months. Non-ex ecutive dir ector appointment Non-executive director s are initially appointed for three year s. This may , subject to satisfactory performance and election or re-election by the shareholders, be extended by mutual agreement. They normally serve for a maximum of nine years, through thr ee terms, each of three year s’ duration. Meetings of non-ex ecutive dir ectors In addition to attending Board and committee meetings, the non-executiv e directors normally meet separately with the Chairman, and sometimes also with the Chief Executive Ocer , at the end of each scheduled Board meeting. The non-executive director s also meet privately at least once a year with the Deputy Chairman, without the Chairman present, and did so once during the year to discuss matters including the Chairman’s performance. Board information All directors r eceive ﬁnancial and operational information each month to help them discharge their duties, and ther e were incr eased ﬁnancial and operational updates this y ear due to the COVID-19 pandemic. Board papers ar e circulated digitally at least one week befor e each Board meeting, to ensure dir ectors have time to review them. Director s have access to independent professional advice at the Company’s expense, if they consider it appropriate. No director obtained an y such advice during the year ended 31 March 2021. Independence As requir ed by the UK Corpor ate Governance Code, the Boar d considers each of the non-executive director s to be independent in character and judgment and believes ther e are no relationships or cir cumstances that are likely to aect (or could appear to aect) each director’s judgment. Conﬂicts of interest, and external appointments The Company’s articles of association allow the Board to authorise actual or potential conﬂicts of interest. The authorisation pr ocedure involves Gr oup Corporate Secr etariat issuing guidance and a questionnaire each August, asking directors to identify an y conﬂicts or potential conﬂicts, which the Boar d then considers at its September meeting. In addition, directors ar e expected to advise the Company Secretary of any actual or potential conﬂicts as soon as they arise so the Board c an consider them at the next available opportunity . In the Board’s view , this pr ocedure oper ated eectively during the year under review . The Board has also agr eed a process wher eby directors’ pr oposed external or additional appointments are r eviewed and considered for approv al by the Board. Corporate governance r eport contin ued Code principle Division of Responsibilities 99 Experian plc Annual Report 2021 Gover nance Nomination and Corporate Gov ernance Committee report Committee’s ke y roles and responsibilities The Board str ongly believes that good governance and strong, responsible, balanced leadership are critic al to business success and to creating both long-term shar eholder value and a strong, sustainable culture. As a Committee, our r esponsibilities include: Ensuring we have appropriate pr ocedures for nominating, selecting, training and evaluating directors, and that adequate succession plans are in place. Reviewing the Board’s structur e, size, composition and succession needs; considering the balance of membership and the Board’s r equired balance of skills, experience, independence, knowledge and diversity . Identifying and nominating, for the Boar d’s approv al, suitable c andidates to ﬁll vacancies for non-executive director s and, with the Chief Executive Ocer’s assistance, executive director s. Boar d appointments are made on merit and against objective criteria, to ensure the Boar d maintains its balance of skills, experience, independence, knowledge and diversity . Reviewing legislative, regulatory and corporate gov ernance developments and making recommendations to the Boar d; and ensuring that the Company observes the standards and disclosur es recommended by the UK Corporate Gov ernance Code. As Chairman of the Nomination and Corporate Go vernance Committee, I am very pleased to report on the work done by the Committee during the year , and pr ovide some detail of the Committee’s principal roles and responsibilities. There ar e updates also on Board composition, diversity and inclusion, and this y ear’s Board evaluation. A key responsibility of the Committee is to ensure plans ar e in place for orderly Boar d succession, and the Committee r egularly receives and r eviews updates on the structure, size and composition of the Board and its committees, to ensur e critical skills and experience are appr opriately refr eshed. During the year , on the r ecommendation of the Committee members, Alison Brittain was appointed to the Board, pro viding signiﬁcant ﬁnancial services, consumer -facing, and retail pr oduct experience, as well as UK -listed company expertise. In addition, the Committee recommended the appointment of Jonathan Howell to the Board. Jonathan is a highly regar ded FTSE 100 Chief Financial Ocer , and has consider able executive and non-executive UK -listed boardroom experience, which will further enhance the strength, depth and eectiveness of the Board. The Committee r eviews any skills gaps and the current Boar d composition (and Board members’ expertise, diversity and tenure) to allow for smooth succession planning. A k ey current focus of the Committee relates to Audit and Remuner ation Committee Chairman succession, given the anticipated departures of Deir dre Mahlan and George Rose fr om the Board in the medium term, follo wing completion of nine years' Board tenur e. The Committee has also maintained its focus on the executive talent pipeline and senior management succession plans, r eﬂecting the Board’s r esponsibility to ensure appr opriate plans are in place. A detailed succession planning update was provided at the January 2021 Committee meeting. Included in the update was an analysis of executive management succession cover age. The impacts of COVID-19 on attrition (which had reduced) wer e also discussed by the Committee. Diversity , equity and inclusion ar e essential to Experian’s purpose, and the Committee received and discussed a detailed update from our Chief People Ocer , Jacky Simmonds, in January 2021. Experian is focused on sever al dimensions of workforce diversity (including r ace/ethnicity , gender , age/generation, working parents/families and L GBTQ+), and the Committee noted that the business was strong in terms of employee commitment, having an inclusive culture and diversity and inclusion initiatives, and that actions were being taken r egarding repr esentation, data and harnessing r egional eorts to maximise impact. At our March 2021 meeting, as well as recommending the appointment of Jonathan Howell to the Board, the Committee considered the pr oposed election/re-election of directors at the A GM, r ecommended Dr Ruba Borno’s re-appointment for a further three- year term, r eviewed the draft corporate governance section of the Annual Report, and reviewed various compan y law and governance changes. As noted earlier in the Corporate gov ernance report, the Committee also reviewed a people strategy , talent and culture update during the year . The Committee was in place throughout the year ended 31 March 2021. As Chairman of the Nomination and Cor porate Governance C ommittee, it is my pleasure to present this year's repor t on the C ommittee's activities during the year . Mike Roger s Chairman of the Nomination and Corporate Gov ernance Committee Members Mike Rogers (Chairman) Dr Ruba Borno Alison Brittain Caroline Donahue Luiz Fleury Jonathan Howell Deirdr e Mahlan George Rose * Fr om 1 May 2021 Quick facts Mike Rogers was appointed Chairman of the Committee in July 2019, when he was appointed as Chairman of the Company . The Board considers the Committee members to be independent non-executive director s, in line with the UK Corporate Gov ernance Code. The Committee met four times during the year ended 31 March 2021. The Chief People Ocer and the Chief Communications Ocer ar e invited to attend certain meetings. The Chief Executive Ocer is also invited to attend meetings and provides v aluable contributions. Quick link experianplc.com/ about-us/ corporate-governance/ board-committees/ Code principle Composition, Succession and E valuation Experian plc Governance 100 Nomination and Corporate Governance Committee r eport contin ued April — July November January March Recommended the appointment of Alison Brittain as an independent non-executive director of the Company . Discussed a detailed AGM brieﬁng from the Company Secr etary and the Chief Communications Ocer , including voting results, shareholder feedback and engagement that had taken place in the lead-up to the AGM. Discussed an update on the agreed focus ar eas from the FY20 Board evaluation. Discussed Board composition and, in particular , approved r ole speciﬁcations for new non-executive directors. Continued important discussions regar ding Board succession, with a focus on plans regar ding Audit Committee Chairman succession. Reviewed the Committee’s performance during the year against its terms of refer ence, and concluded that it was operating eectively . Agreed the structure of the FY21 Board, committee and director evaluation. Reviewed and discussed a people, talent and culture update, including the identiﬁed strategic pillars, k ey risks, people implications and insights gained from business leaders. Reviewed an update on executive succession, including speciﬁc plans for key oper ational and functional roles. Reviewed an update on diversity , equity and inclusion, outlining the Experian philosophy and approach, where the business was strong, and where further eorts are needed. Received and considered a Board succession update. Recommended to the Board the directors due to be consider ed for election/re-election at the 2021 AGM. Considered the annual company law and governance update. Recommended the re- appointment of Dr Ruba Borno as a director of the Company for a further three-y ear appointment term. Recommended the appointment of Jonathan Howell as an independent non-executive director of the Company . A s at 1 May 2021 Balance of executive and non-e xecutive director s Gender diversity of the Board Ethnicity of the Board 6 3 1 1 Independent Chairman Executive Independent non-executive T otal number of directors White – European White – North American Non-white ethnic group – Ar abic No n-w hite eth nic grou p – Sout h Amer ica n T otal number of directors Men Women T otal number of directors Non-executive dir ector skills Gender diversity of ex ecutive committee and direct reports 3 3 4 74% 4 26% 4 1 1 Financial ser vices Serving listed company executive Consumer/Digita l Financial expertise T e chnology/Informat ion Consumer packaged goods Manufacturing/Large pr ojects Men Women 1 3 11 4 (36%) 11 T enure of the Board 11 5 years, 9 months <1 year 1 to <3 years 3 to <6 years 6 to <9 years 9+ years T otal number of directors A verage Boar d tenure 1 2 4 2 2 7 (64%) 7 11 * T able signiﬁes the number of non-executive directors, as at 1 May 2021, considered to have that particular expertise. Individual non-executive dir ectors may have more than one ar ea of expertise. Committee activities during FY21 Board, and executive committee (and direct r eports), composition Code principle Composition, Succession and E valuation 101 Experian plc Annual Report 2021 Gover nance Board c omposition As at the date of approv al of the Annual Report, the Board comprises the independent Chairman, Mik e Rogers, three executiv e directors and seven independent non-ex ecutive directors, including the Deputy Chairman, George Rose. George is also the Chairman of the Remuner ation Committee. Deir dre Mahlan is the Chairman of the Audit Committee and Mike Rogers is the Chairman of the Nomination and Corporate Gov ernance Committee. The Nomination and Corporate Gov ernance Committee regularly ev aluates Board composition from a number of perspectives, including diversity and orderly succession. The Committee’s discussions during the year concluded that there should continue to be a focus on diversity , including gender and ethnicity , and ther e was a prefer ence where possible for recruiting non-executive dir ectors who are serving executives at other organisations, and who have r ecent and relevant ﬁnancial e xperience. Audit and Remuner ation Committee chairmanship has also been a recent focus of the Committee. Interms of near- and medium-term skill requir ements, the Committee’s f ocus will include non-executives who provide good geographic r epresentation in terms of Experian’s markets, and technology , decisioning, adv anced data and analytics will be considerations also. As with all Board appointments, the Committee recognises the continued importance of cultur e, ﬁt and international experience when assessing potential candidates for the Boar d. Induction and training The Company has procedur es to ensure newly appointed directors r eceive a formal induction, involving meetings with senior executives and functional leaders. A tailored induction progr amme is designed for each new non-executive director who joins the Boar d, to ensure they ar e equipped with a foundation of knowledge and materials necessary to add value. Individual induction progr ammes are usually completed within the ﬁrst six months of a director’s appointment and the Company Secretary pr ovides assistance and support throughout the induction pr ocess. The progr ammes are reviewed regularly to consider directors’ feedback and ar e continually updated and improved. During the year , the Board appointed Alison Brittain as an independent non-executive director , and Alison’s induction took place via video technology in late 2020. A similar induction has been arranged for Jonathan Howell, to tak e place in June/July 2021. Alison's induction included: Business/Operations – brieﬁngs, regional and global business overviews and pr oduct demonstrations in r espect of a number of business areas, including: T echnology and Information Security , Consumer Information Services, Decision Analytics, V ertical Markets, as well as business market and ﬁnancial overviews. Corporate/Governance – focused brieﬁngs on corporate gov ernance, audit and inv estor relations and communic ations. Other ar eas covered include r emuneration, talent, people and rewar d; a ﬁnancial overview , budget and capital str ategy; strategic planning, corporate development and competition overview; legal compliance, r egulation, government aairs, risk management; and corporate r esponsibility . Diversity We believe that diver sity and inclusion are essential to our purpose of creating a better tomorrow – making positive change in the world by actively working to open up access to ﬁnancial systems to marginalised communities. Our core philosophy is that our employ ees are people ﬁrst, and we welcome people of all backgrounds to bring their whole selves to our team. The Board’s diversity policy is unchanged. We strongly believe that diver sity throughout the Group and at Boar d level is a driver of business success. W e respect, value and welcome all forms of diversity , and seek to r eﬂect the diversity of our clients, investors and employees in our Board. W e recruit talented Board members, who have the appropriate mix of skills, c apabilities and market knowledge to ensure the Boar d is eective. When recruiting, we look across all sectors and non-tr aditional talent pools, and we r equire diver sity on our candidate shortlists. When making Board appointments, the Committee reviews and appr oves an outline brief and role speciﬁc ation, and appoints a search agent for the assignment. We disclose the name of the sear ch agent and any other connection they have with Experian in our next Annual Report. The speciﬁcation and the search ar e discussed with the search agent, who then pr epares an initial longlist of candidates. The Committee deﬁnes a shortlist and holds interviews. Ultimately , the Committee makes a recommendation to the Board for its consider ation. Follo wing Board approv al, the appointment is announced in line with the requir ements of the UK Financial Conduct Authority's (FCA ’s) Listing Rules. In due course, a tailored induction pr ogramme is developed for the new director . We engaged Russell R eynolds as the specialist search ﬁrm involv ed with the recruitment of Alison Brittain and Jonathan Howell, our most recently appointed non-executive dir ectors. They also provide other executiv e search services to the Group. Step 1 Committee reviews and approves an outline brief and role speciﬁc ation and appoints a search agent for the assignment Step 4 The Committee makes a recommendation to the Board for its consideration Step 2 The agent prepar es an initial longlist of candidates Step 3 The Committee then considers a shortlist and we hold interviews Step 5 F ollowing Board approv al, the appointment is announced in line with the requir ements of the FCA ’s Listing Rules Proc ess for Board appointments Code principle Composition, Succession and E valuation Experian plc Governance 102 Diversity (c ontinued) Although we do not publish speciﬁc Board diversity targets, the female representation of the Board is 36%, which exceeds the curr ent Hampton-Alexander Review r ecommendation of 33%. W e also continue to monitor closely the numbers submitted as part of our Hampton- Alexander commitment around our executive committee and their direct r eports. The proportion of women in this population stands at 26%. As part of our commitment to continue to improve upon our gender diver sity , we ar e putting in place a three- year target of 30% for this group. This, alongside the targets set f or senior and mid-level leaders within Experian, will ensure a str ong pipeline of women for our most senior positions over time. In addition, the F ebruary 2021 Parker Review Committee update conﬁrmed that we met their Board ethnic diversity r ecommendations. W e recognise the signiﬁc ant beneﬁts of a diverse Board and, when recruiting, will continue to seek to address any diver sity gaps on our Board, including gender and ethnicity . As well as the Board policy outlined above, the Group’s Code of Conduct further outlines our approach and how we think about diversity . We under stand the fundamental value that diversity , equity and inclusion bring to our business, and ther e are man y ongoing initiatives to support a work environment in which everyone is treated with fairness and respect, has equal access to opportunities and resour ces, and c an contribute fully to our success. At Experian, we embrace diversity and appreciate dier ent perspectives and the unique value each employee brings. Fundamentally , we do not discriminate against anyone based on r ace, colour , religion, gender , sexual orientation, gender identity or expression, national origin, disability , age, covered veter an status, or any other characteristic pr otected by law . The Code of Conduct applies to everyone at Experian, including contractor s, suppliers and other s who do business with us. Contr actors and suppliers performing work on behalf of Experian are expected to comply with the law and the portions of the Group’s Code of Conduct that apply to them. The UK Corporate Gov ernance Code speciﬁes that the Board should undertake a f ormal and rigorous annual evaluation of its o wn performance and that of its committees and individual directors, and that the Board should also have an externally facilitated evaluation at least once every three year s. FY21 was Y ear 2 of our Board’s thr ee-year review cycle. Last year (FY20), an independent external evaluation was conducted by Manchester Square P artners to pro vide the Board with gr eater insights into its performance and to identify opportunities to further increase and impr ove its over all eectiveness. The conclusion of the external evaluation was that the Boar d was functioning extremely well and in line with ﬁr st-class governance. Boar d dynamics were considered to be excellent, with speciﬁc char acteristics including inclusivity , supportiveness, constructively challenging and responsible. The Board was noted as being uniﬁed and aligned, with the Experian agenda as the priority . Y ear 1 – FY20 Evaluation b y external facilitator Y ear 2 – FY21 Internal review against detailed Y ear 1 review Y ear 3 – FY22 Questionnaire-based internal evaluation F ollowing that external evaluation, the Board agreed ar eas of focus for FY21. This year , the second year of our cycle, involved the Board performing an internal ev aluation of progr ess against the FY21 areas of focus and the resulting actions, as well as agreeing new ar eas of focus for the coming year . The third year of the cy cle, to be undertaken in FY22, will be a questionnaire- based internal evaluation. This year’s internal evaluation was structured as follow s: Board Committee s Individual directo rs Gro up Corp ora te Secr etaria t revie wed pro gres s agains t the agre ed F Y21 areas of fo cus and an u pdate was p rese nted at th e Board m eetin g in March 2021 . Tha t update, an d the Bo ard rev iew and dis cussi on of it s actio ns, and t he ac tions of mana gement , agains t the F Y21 areas of f ocus fo rmed t he basis o f this year ’ s r eview f rom a B oard pe rspe cti ve, and ne w F Y22 area s of focus w ere agr eed. A per fo rmanc e evaluatio n discus sion was in cluded o n the age ndas of the B oard co mmit tees , suppo r ted by an analy sis of how ea ch commit tee was p er formin g agains t the key area s in its te rms of r eferen ce. Meetings were held between each dir ector and the Chairman in March 2021, in relation to each dir ector ’s performance. The Deputy Chairman and Senior Independent Director evaluated the Chairman, taking account of input fr om other director s. Board evaluation Nomination and Corporate Governance Committee r eport contin ued Code principle Composition, Succession and E valuation 103 Experian plc Annual Report 2021 Gover nance Area F ocus Progress COVID-19 pandemic As the pandemic evolved, the Board took decisiv e action to agree a set of priorities and goals for the Group, the purpose of which was to establish measures of success for the Boar d’s role in navigating the emergency . These covered: maintenance of oper ations while keeping our people, clients and suppliers saf e and healthy; preserving the health of the business (including its ﬁnancial health); recovering strongly as the emer gency subsides; and using the Group’s capabilities to help communities survive and r ecover rapidly . It is expected that a signiﬁcant Board focus for the coming year wil l be how the Group adapts, adjusts and recov ers from the situation and lessons learned that could have relev ance for the evaluation and mitigation of emerging risks. The Board will play a key part in this process, guided by the agreed priorities and goals. Additional Board meetings and updates wer e initiated at an early stage, and took place in April 2020 and June 2020, in addition to the scheduled meetings in March, May and July 2020. This allowed the Board to r egularly oversee the actions being taken by the Gr oup in response to the pandemic and to r eceive regular updates on trading. Early action was taken to ensure an appr opriately focused Board agenda, principally thr ough the inclusion of a 'COVID-19 Boar d Report' covering People, Operations, Consumer/Regulatory , Funding, Societal Support, Return to business-as-usual, and the Group’s global r esponse. R eporting on many of these matters was also enhanced in the regular updates to the Boar d between meetings. The Audit Committee requested, and discussed, a management report speciﬁcall y related to the potential impacts on the Gr oup’s risk environment arising fr om COVID-19, including the impact of the Group’s principal risks and k ey activities undertaken within the Group’s pandemic r esponse plans. Board succession and talent The Board’s FY21 priority will be on non-executive succession, particularly chairmanship of the Remuner ation and the Audit Committees, as the curr ent role holder s approach the natur al end of their Board terms of appointment. The focus for the Chairman and the Board will be on r eplacing the signiﬁcant breadth and depth of e xperience, insight, advice and challenge that will leave the Board, ensuring the right seniority , experience (including ﬁnancial) and cultural ﬁt of an y successors, and that there is a smooth tr ansition (and comprehensive induction) for any new appointments. As part of its regular meetings and visits, the Boar d spends time with the senior leadership team and has opportunities to meet up-and-coming talent within the organisation. Ther e is also an annual formal review of talent, discussion of speciﬁc appointments as needed and updates on talent development progr ammes. The development, attr action, retention and diversity of talent is also an area of incr easing focus for the Board, as the Group evolves into new and highly competitive business areas, balancing internal development with key external hir es. Alison Brittain was appointed as an independent non-executive director on 1 September 2020. Jonathan Howell was appointed as an independent non-executive director on 1 May 2021. The Nomination and Corporate Governance Committee continued to regularly discuss Boar d composition and succession (including Committee chairmanship succession) and reviewed the r ole speciﬁcations for the new non-executive dir ector appointments and potential future appointments. The Nomination and Corporate Governance Committee continued to receive in-depth updates on senior leadership succession, diversity and inclusion, and people str ategy , talent and cultur e, including updates on the Group’s people development pr ogrammes. The Board continued to spend time with senior management and high-potential talent within the business. This was undertaken via video technology during the year , and it r emains the intention that the Board will r e-commence visits to the Group’s ke y business locations when it is safe to do so in line with COVID-19 tr avel restrictions and public health guidance. Progr ess against the focus areas highlighted in the FY20 review FY22 focus areas agr eed in the FY21 review Area F ocus Culture and Social capital As the Board concluded in this year’s internal evaluation, the Board has continued to oper ate eectively despite not meeting together physicall y since January 2020. Since that time, two new independent non-executive directors have joined the Boar d. Although there may be some changes to the way the Boar d operates in the future, the Board r ecognises the importance of remaining closely connected with the business and fellow dir ectors, in order to lead by example and continue to pr omote and monitor the desired cultur e throughout the Gr oup. The Board intends to focus on way s to further strengthen the cultur e and rebuild social c apital to ensure that the str ong culture of the Board is not impacted by the COVID-19 pandemic, and that it continues to operate as a high-performing collegiate team. Environmental, Social, and Governance (ESG) The Group continues to pr ogress a number of ambitious pr ogr ammes of ESG-centred activities, which include consider ations around climate change, gender and ethnicity , diversity , pay , monitoring of suppliers, reporting framework s, and the positive r ole of the Group and data in society . The Board, through its o versight of the Group’s str ategy and its responsibilities, will continue to evaluate ho w ESG issues aect key aspects of the business and what Experian’s ambitions and goals should be as a long-term sustainable business. Code principle Composition, Succession and E valuation Experian plc Governance 104 I am pleased, as Chairman of the A udit Committee, to r eport on how the Committee carried out its responsibilities during the year , in particular with the ongoing COVID-19 global pandemic, and ho w we discharged our duties. The Committee’s remit is to: r eview and monitor the integrity of the Group’s ﬁnancial reporting, ensuring that any judgments made are appr opriate; ensure the external auditor is independent and eective in its role, and recommend the appointment of the external auditor; and ensure that the Gr oup has an eective internal control fr amework, including the risk management system. The Committee members’ collective international and ﬁnancial experience enables them to act eectively in these areas, and the work of the Committee during the year cover ed all elements of its remit. This report contains details of the signiﬁc ant issues we considered in r elation to the ﬁnancial statements and how these were addressed, and our process f or concluding that this Annual Report is fair , balanced and understandable. I am pleased to repo rt on th e Commit tee’ s ac tivities during the year , especially with 2020 being a par ticularly dicult year given the ongoing COV ID- 1 9 global pandemic. Deirdre Mahlan Chairman of the Audit Committee Members Deirdr e Mahlan (Chairman) Dr Ruba Borno Alison Brittain Caroline Donahue Luiz Fleury Jonathan Howell George Rose * Fr om 1 May 2021 Quick facts Deirdr e Mahlan has chaired the Committee since January 2015. Deir dre is a qualiﬁed accountant with an MBA and has many years’ experience in senior ﬁnance roles, most recently as Chief Financial Ocer of Diageo plc. All members of the Committee are independent non-executive director s and the Board considers them to ha ve an appropriate level of experience. Deirdr e Mahlan, Geor ge Rose and Jonathan Howell are consider ed to have recent and r elevant ﬁnancial experience, in line with the UK Corporate Governance Code. The Committee met four times during the year , with each scheduled meeting timed to coincide with key dates in the Group’s ﬁnancial r eporting and audit cycle. Regular attendees at meetings include the Chairman, the executiv e directors, the Group Gener al Counsel , the Head of Global Internal Audit, the Global Financial Controller , the Chief Information Ocer , the Chief Information Security Ocer and repr esentatives from KPMG LLP (the external auditor). Other invitees include the Global Head of Risk Management and the Global Head of Compliance. At the end of each scheduled meeting, the external auditor and the Head of Global Internal Audit meet with the Committee to discuss any matters without management being present. The Committee is authorised to seek outside legal or other independent professional advice as it sees ﬁt. The Committee responded quickly to the impact of COVID-19 on its areas of responsibility . Soon after the start of the pandemic, the Committee r equested a COVID-19 speciﬁc risk update from management, which was pr esented to the Committee early in FY21. The initial view of the Committee was that COVID-19 had impacted some of the Group’s principal risk s – for example, risk consider ations related to employees working from home. For each risk area impacted, the Committee was advised of the mitigating actions that had been put in place. These included, for the risk s associated with working from home, enhanced technical measures to r estrict, secur e and monitor devices, incr eased phishing testing, robust compliance requir ements for employees with access to sensitive data and implementation of critical security updates. A similar analysis was discussed by the Committee in respect of each of the impacted Group principal risk s. The Committee was in place throughout the year ended 31 March 2021. Audit Committee report Committee’s ke y roles and responsibilities Monitoring the integrity of the ﬁnancial statements and reviewing signiﬁc ant ﬁnancial reporting judgments contained in them. Reviewing internal ﬁnancial controls and the Group’s internal contr ol and risk management systems, with special attention this year on COVID-19 speciﬁc risks. Reviewing the eectiveness and quality of the audit process and the independence and objectivity of the external auditor . Monitoring and reviewing the eectiveness of the internal audit function. Developing and implementing policy on engaging the external auditor to supply non-audit services, taking into account relevant guidance. Approving the external auditor’s remuner ation and terms of engagement , and making recommendations about its re-appointment. Quick link experianplc.com/ about-us/ corporate-governance/ board-committees/ Code principle Audit, Risk and Internal Control 105 Experian plc Annual Report 2021 Gover nance Committee activities during FY21 May September November March Reviewed the preliminary results announcement and the Annual Report, and paper s in relation to: – year-end accounting matters – the preparation of ﬁnancial statements on the going concern basis (see also note 2 to the Group ﬁnancial statements) – the making of a viability statement recommendation to the Board – the fair , balanced and understandable assessment – and the making of management repr esentations. Reviewed the 2020 Annual Report to ensure it was fair , balanced and understandable and provided information enabling an assessment of Experian’s position and performance, business model and strategy . Reviewed and discussed with management the draft Enforcement Notice r eceived from the UK Information Commissioner's Oce (ICO), and the associated accounting impact. Reviewed the Risk Management Fr amework and Summary of Assurance, including a COVID-19 speciﬁc risk update. Reviewed the external auditor’s year-end r eport, including independence considerations. Reviewed non-audit fees. Considered the FY21 external audit plan with the external auditor , including its scope, materiality and the expected impact of COVID-19. The plan included the external auditor’s response to developments in the business during the year , developments in the audit process, the Group’s risk assessment and the coverage of the audit. Reviewed the eectiveness of the external auditor (see page 107 ‘External auditor’). Evaluated the performance of the Global Internal Audit function (see page 107 ‘Internal audit’). Received and discussed with management an update in relation to a South Africa fraudulent data access matter . Continued to assess with management the impact of COVID-19 from a risk per spective (including information security), noting the COVID-19 risk assurance that had been undertaken. Reviewed the Compliance Management Progr amme overview from the Global Head of Compliance; assessed the Compliance terms of refer ence and received annual compliance training. Reviewed fraud and Conﬁdential Helpline updates. Reviewed the Group’s T reasury Policy . Approved the Committee’s annual meeting schedule and reviewed the Committee’s performance against its terms of refer ence. Reviewed the half-yearly ﬁnancial report announcement, and papers in relation to: – half-year accounting matters – the preparation of the half-yearly r eport on the going concern basis – a fair , balanced and understandable assessment – and the making of management repr esentations. Although not required for the half-year , reviewed the viability modelling assessment that had taken place, given the situation with COVID-19. Reviewed the external auditor’s half-year r eport, including independence considerations. Reviewed and discussed with management the ﬁnal Enforcement Notice r eceived from the ICO, the appeal made by the Group, potential business impacts of the notice, and the associated accounting considerations. Debated extensively with management the restructuring charge for the tr ansformation progr amme in the UK and Ireland and other r estructuring initiatives. Received an update and Committee training fr om the external auditor in respect of forthcoming audit industry changes (including strengthening of internal controls fr ameworks, known as ‘UK SOX’), new or impending accounting standard changes, and the lik ely impacts and considerations for Experian. Reviewed the principal accounting policies, pr e-year -end accounting matters and updates on the year-end ﬁnancial statements and ﬁnancial review . Reviewed the external auditor’s pre-y ear-end r eport, including scope, status and contr ols ﬁndings. Reviewed fraud and Conﬁdential Helpline update. Reviewed the Group’s T ax P olicy . Reviewed the Group’s non-audit fee policy and the Group audit fee. Reviewed the Global Internal Audit strategy and annual plan. Considered the re-appointment of the external auditor . Reviewed an information security update from the Chief Information Security Ocer at each scheduled meeting. This is a standing item on the Committee agenda, given its importance to the Group. Included this year were updates on the impact of COVID-19 on information security , for example in r elation to any increased risk fr om employees working from home and the r esultant changing threat landscape. Reviewed full or summary risk management updates at each meeting, including status of and changes to the Group’s principal risks, material litigation, r egulatory developments and details of any emerging risk s, with particular focus on COVID-19 speciﬁc risks. An Internal Audit update was presented by the Head of Global Internal Audit at each meeting, and discussed by the Committee, including the status of the audit plan, audit ﬁndings and themes in the reporting period, and progr ess on any over due audit actions. All meetings Code principle Audit, Risk and Internal Control Experian plc Governance 106 Audit Committee report contin ued Signiﬁcant issues The table below summarises the signiﬁcant matters consider ed by the Committee in relation to the Gr oup and Company ﬁnancial statements and the way they were concluded. These matters, together with any other signiﬁc ant considerations of the Committee, are reported to the Boar d. The minutes of each Audit Committee meeting are also cir culated to all members of the Boar d. Matter considered Challenge and conclusion Impairment review – goodwill and other intangible assets A summary of the annual impairment analysis and underlying process w as provided to the Committee. The analysis indicated that, following a challenging year impacted by the eects of the COVID-19 pandemic, gr owth in Asia Paciﬁc was adversely aected and the estimated recover able amounts of the assets were below their carrying value. Accordingly , an impairment of goodwil l in the region was pr oposed. The recover able amounts of the assets of all other segments continued to suciently exceed their carrying amounts. The Committee scrutinised the methodology and assumptions applied by management. In respect of Asia P aciﬁc, the Committee challenged management on the longer-term str ategy of the region and the extent to which this could be captured in the f orecasts used. The Committee debated with management the best approach to including for ecasting adjustments. The Committee concurred with management’s conclusions that an impairment of goodwill was requir ed in Asia Paciﬁc. The Committee noted the headroom and the sensitivity to changes in assumptions and concurred with the pr oposed disclosure of these in note 20 to the Group ﬁnancial statements. Impairment review – other assets A summary of the review pr ocess for other assets was provided to the Committee. The review indicated that an impairment w as requir ed in one of the Group’s intangible assets, and that an impairment r eversal was r equired in one of the Group’s associates. The Committee scrutinised the methodology and assumptions applied by management. The Committee noted the changes in trading performance against the f orecast of the associate and debated with management the future str ategy for this investment. The Committee concurred with management’s conclusion that a write-down of intangibles was requir ed, an impairment r eversal in associates was r equired and that the proposed accounting was appr opriate. Going concern and viability The Committee reviewed the assessment of going concern and viability . The Committee scrutinised the key risk s and viability scenarios, the assumptions used and the methodology . The Committee concurred with management’s assessment that the Gr oup isagoing concern and is expected to remain viable. Acquisitions The Committee received an update on the acquisitions made during the year notably the acquisitions of Arvato’s Risk Management division in Germany , T apad, Inc. in North America and BrScan in Brazil. The Committee noted these deals included elements of contingent consideration and put options, and that an independent external valuer had assisted with these valuations along with the acquired assets and liabilities. The Committee discussed with management a reﬁnement to the non-controlling inter est policy , in light of these acquisitions. The Committee approved the v aluation of the acquisition intangibles and accounting for non-controlling inter ests. Ta x The Committee received a r egular update from management on the adequacy of provisions in r espect of signiﬁcant open tax matters. The review included details of ongoing correspondence with tax authorities in the UK, the USA and Br azil and the principal areas of tax challenge. The Committee agreed that the assessment of the uncertain tax positions was appropriate and that the judgment taken in r espect of the year-end provision in the Group ﬁnancial statements was r easonable. The Committee also noted the evolving and complex tax laws that applied to the Group and the uncertainty that these might bring. It concluded that the Group tax risk disclosur es were appr opriate. Litigation and regulatory matters The Committee received an update and analysis of open litigation and r egulatory matters aecting the Group, including the enforcement notice from the UK Information Commissioner’s Oce. The Committee concluded that these matters had been appropriately pr ovided for at 31 March 2021. The Committee considered and concurr ed with the proposed contingent liability disclosures included in the notes to the Gr oup ﬁnancial statements. Restructuring A summary of potential restructuring opportunities was pr esented to the Committee in the ﬁrst half . The Committee discussed the proposals with management. As the performance of the Group str engthened the Committee challenged management to keep the over all progr amme limited and focused on certain speciﬁc areas. The Committee approved the pr oposed accounting for the progr amme as a non-benchmark item. Code principle Audit, Risk and Internal Control 107 Experian plc Annual Report 2021 Gover nance Each year , in line with the UK Corpor ate Governance Code and the Committee’s terms of refer ence, the Committee is asked to consider whether or not, in its opinion, the Annual Report is fair , balanced and understandable (FBU) and whether or not it pr ovides the information necessary for shareholders to assess the Gr oup’s position and performance, business model and strategy . Ther e is an established process to support the Audit Committee in making this assessment, and we use a similar pr ocess for the Group’s half -yearly ﬁnancial r eport. The main elements of the process are: A list of ‘key areas to f ocus on’ was previously shar ed with the Annual Report team. The team is reminded of the requir ement annually , and asked to r eﬂect this in their drafting. An internal FBU committee considered the Annual Report in May 2021, ahead of the Audit Committee meeting. A wide r ange of functions are r epresented on this committee, including executiv es from ﬁnance, communic ations, in vestor relations, legal and corpor ate secretariat. The external auditor also supports the committee. In advance of its May 2021 meeting, the Audit Committee received a near -ﬁnal draft of the Annual R eport, together with a reminder of the ar eas to focus on. The FBU committee’s observations and conclusions were also r elayed to the Audit Committee. Fol lowing its review this year , the Audit Committee concluded that it was appropriate to conﬁrm to the Boar d that the 2021 Annual Report was fair , balanced and understandable, and provided the information necessary for shareholder s to assess the Group’s position and performance, business model and strategy . The FBU statement appears in the Directors’ r eport . The key ar eas to focus on included ensuring that: The overal l message of the narrative reporting is consistent with the primary ﬁnancial statements. The overal l message of the narrative reporting is appr opriate, in the context of the industry and the wider economic environment. The Annual Report is consistent with messages already communic ated to investors, analysts and other stakeholder s. The Annual Report, tak en as a whole, is fair , balanced and understandable. The Chairman and Chief Executive Ocer’s statements include a balanced view of the Group’s performance and prospects, and of the industry and market as a whole. Any summaries or highlights captur e the big picture of the Gr oup appropriately . Case studies or examples are of str ategic importance and do not over-emphasise immaterial matters. Internal audit An internal evaluation of Internal Audit was reviewed by the Committee at its September 2019 meeting, as part of the agr eed four- year evaluation cycle (a full external quality assessment every four years, and follow-up interim external quality assessments and internal reviews in the intervening period). In September 2020, the Committee r eviewed the conclusions of a further internal evaluation of Internal Audit, which comprised: internal quality assurance r esults; post-audit stakeholder feedback; key internal metrics; self-assessment against the International Standards for the Pr ofessional Pr actice of Internal Auditing and the Code of Ethics by the Head of Global Internal Audit; and a survey of principal stakeholders for ar eas requiring improvement. All audits that had been assessed using Internal Audit’s quality assurance pr ocess were r ated positively , with str ong adherence to standards and pr ocesses. F eedback from stakeholders was also positive, and there was good progr ess in relation to the quality of the assurance pr ocess and the insights provided by Internal Audit. The assessment against key internal metrics indicated that a continued focus area should be the time tak en to issue reports. Ther e was conformance with the International Standards for the Pr ofessional Practice of Internal Auditing, and stakeholder feedback on the function was strong, with the team viewed as highly eective, pr ofessional and independent. External auditor T enure and tendering KPMG LLP (KPMG) has been the Company’s auditor since July 2016, fol lowing the conclusion of the audit tender process in September 2015. There ar e currently no contractual obligations r estricting our choice of external auditor and we conﬁrm that we have complied on a voluntary basis (as a non-UK -incorporated company) with the provisions of the UK Competition and Mark ets Authority (Mandatory Use of Competitive T ender Processes and Audit Committee responsibilities) Or der 2014 for the ﬁnancial year under review . Eectiveness, audit quality , independence and appointment At its September 2020 meeting, the Audit Committee reviewed and discussed KPMG’s audit strategy for the y ear ended 31 March 2021. In November 2020, and Mar ch and May 2021, the Committee received detailed updates on the audit’s progr ess, which included details of the external auditor’s actions, such as the audit procedur es undertaken, the audit’s cover age, the impact of COVID-19 on the audit, the segregation of duties and the status of any signiﬁcant ﬁndings, as well as details of key matters arising from the audit and assessments of management’s judgments on them; and reviewed the content of the independence letter and the management repr esentation letter , as well as engagement terms. The Committee formally review s the eectiveness of the external auditor at its September meeting. This year , questionnair es were pr ovided to Board member s, senior operational and functional management and senior regional, ﬁnance and treasury leadership. As part of the evaluation, the FRC’s Guidance on Audit Committees was reviewed to ensure that best pr actice was being followed. The evaluation focused on the four key ar eas used in the FRC’s May 2015 ‘Practice aid f or audit committees’: mind-set and culture; skills, character and knowledge; quality contr ol, and judgment. The Committee also reﬂected on the assurance on ﬁnancial statements, the audit teams and communication, as well as considering external regulatory updates on the external auditor received during the year . The over all results of the evaluation wer e favour able, particularly with r egard to quality and value of the service. There wer e no concerns regar ding the independence of the audit team, the technic al knowledge of KPMG or the way in which judgments were explained. The Committee concluded, based on feedback and information obtained during its other work, that the external auditor had performed eectively , and that the Gr oup and the auditor had complied with relevant guidance. The Committee also assesses the quality of the audit (along with the eectiveness review described above) in the following ways: Evaluation of external auditor (pr ocess described above) – the large majority of internal respondents agr eed that the audit had been completed eciently and as planned; where this was not the c ase, it was felt that F air , balanced and under standable – what did we do? Code principle Audit, Risk and Internal Control Experian plc Governance 108 Audit Committee report contin ued deviations from the plan wer e communicated and appropriate. It was additionally noted that any COVID-19 r elated changes were handled eciently and eectively . No necessary improvements wer e noted with regard to the external auditor's judgment and communication, particularly as to technical issues, estimates, discussing potential issues and management letter content. Meeting attendance by the external auditor – KPMG attend all scheduled Committee meetings and, during the y ear , r eported to the Committee on the components of the audit plan, additional or forthcoming requir ements or regulatory changes, audit ﬁndings and interim audit ﬁndings. These reports, the private sessions held with the Committee, and the level of challenge applied by the external auditor to management, ar e opportunities for KPMG to demonstrate and articulate (and for the Committee to assess and challenge, as requir ed) the quality of the audit work. FRC Audit Quality Inspection Report (A QR) – in June 2020, the FRC published its A QR for KPMG, which was focused on the key ar eas requiring action by KPMG to safeguard and enhance audit quality . This pr ovided the Committee with an external perspective on the quality of audits by KPMG, and the Committee noted the FRC’s comments that there had been consider able focus on audit quality at the top of the ﬁrm and a number of improvements to the audit pr actice as a result. However , the r eport also observed that further increased consistency of high- quality audits was requir ed. In r esponse to the ﬁndings, KPMG subsequently updated the Committee on the investment being made in audit quality , talent r etention, diversity , and the ongoing monitoring that was in place. T echnology and processes – KPMG employ a ‘hub’ approach in or der to perform standardised testing for each loc al market. This approach includes the use of data analytics techniques, which supplies audit evidence over signiﬁcant quantities of data, and this provides a perspective on audit quality to the Committee. Independence is an important element of the external audit. T o ensure auditor objectivity and independence, the Committee r eviews potential threats to independence and the associated safeguards during the year . The safeguards that KPMG had in place during the year to maintain independence included annual conﬁrmation by KPMG sta of compliance with ethics and independence policies and procedur es. KPMG also had in place underlying safeguards to maintain independence by: instilling professional v alues; communications; international accountability; risk management, and independent reviews. They also ensured that there was appr opriate pre-appr oval for non-audit services, which ar e pro vided only if permissible under relevant ethic al standards. The Committee concluded that the external auditor had maintained its independence throughout the year . Non-audit services KPMG provides other services to Experian. T o ensure auditor objectivity and independence, we have a policy relating to pr oviding such services. The policy includes ﬁnancial limits above which any pr oposed non-audit services must be pre-appr oved, depending on the expenditure pr oposed. The Committee receives half-yearly r eports providing details of non-audit assignments carried out by the external auditor , together with the r elated fees. Under the policy , non-audit fees paid to KPMG are c apped at 30% of the fees for audit services, except in exceptional circumstances. Pre-appr oval by the Audit Committee or Audit Committee Chairman is requir ed in that situation. An analy sis of fees paid to the external auditor for the year ended 31 Mar ch 2021 is set out in note 13 to the Group ﬁnancial statements. Background The Audit Committee annually review s the policy on the provision of non-audit services and the recruitment of former auditor employees, and the latest review took place in March 2021. The policy , which is set out below , recognises the importance of the external auditor’s independence and objectivity . Policy The external auditor is prohibited fr om providing any services other than those directly associated with the audit or r equired by legislation. These are limited to: Reporting requir ed by a competent authority or regulator under UK law or regulation, for example: – Reporting to a regulator on client assets; – In relation to entities regulated under the UK Financial Services and Markets Act 2000 (FSMA), r eports under s166 and s340 of FSMA; – Reporting to a regulator on regulatory ﬁnancial statements; – Reporting on a Solvency and Financial Condition Report under EU Solvency II Directive 2009 Reporting on internal ﬁnancial controls Reports requir ed by or supplied to com petent authorities/r egulators supervising the audited en tity , wher e the authority/regulator has either sp ec iﬁe d t he auditor to provide the service or identiﬁed to the entity that the auditor would be an appropriate choice for service pr ovider Audit and other services provided as auditor of the entity , or as r eporting accountant, wher e the services are r equired by law or regulation Reviews of interim ﬁnancial information; and providing veriﬁc ation of interim proﬁts Extended audit or assurance work wher e the work is integrated with the audit work and is performed on the same principal terms and conditions Services which support the entity in fulﬁlling an obligation requir ed by law or regulation, where the pr ovision of such services is time critical and the subject matter of the engagement is price sensitive Reporting on government gr ants Reporting on covenant or loan agr eements which requir e independent veriﬁcation Additional assurance work on material included within the Annual Report Services which have been the subject of an application to a competent authority . The appointment of the external auditor for any non-audit work up to US$50,000 must be approved by the Global Financial Contr oller . The appointment of the external auditor for any non-audit work where the expected f ees are over US$50,000 and up to US$100,000 requir es the approv al, in adv ance, of the Gr oup Chief Financial Ocer . Where the expected fees are over US$100,000, the approval of the Chairman of the Audit Committee is requir ed in advance. Where cumulative annual fees exceed the 30% annual limit, all expenditur e must be approved by the Chairman of the Audit Committee (via the Global Financial Controller), up to 35%. Where cumulativ e annual fees exceed the 35% annual limit, all expenditure must be appr oved by the Audit Committee. All expenditur e is subject to a tender process, unless express permission is provided by the Chairman of the Audit Committee, the Chief Financial Ocer or the Global Financial Controller based on the above approv al limits. An y expenditure below US$100,000 not subject to a tender will be notiﬁed to the Chairman of the Audit Committee. Provision of non-audit servic es Continued opposite Code principle Audit, Risk and Internal Control 109 Experian plc Annual Report 2021 Gover nance Commercial agr eements where Experian provides services to the auditor must be approved by the Global Financial Contr oller and not exceed the lower of 5% of the local Experian entity’s total revenue and US$250,000, and all tr ansactions should be undertaken on an arm’s length basis. T ransactions in excess of this limit requir e approv al of the Chairman of the Audit Committee in advance. The Committee will receive half- yearly r eports providing details of assignments and r elated fees carried out by the external auditor in addition to their normal work. F ollowing the year-end audit, neither Experian nor any of its subsidiary companies will employ any audit partner or audit team member in a position which could have a signiﬁcant inﬂuence on the Gr oup’s accounting policies or the content of its ﬁnancial statements until a cooling-o period has elapsed. The cooling-o period is two years in r espect of an audit partner , and one year in respect of a dir ector , wher e they have worked on the audit of Experian plc or its subsidiaries. The KPMG Engagement Letter further prohibits Experian fr om soliciting the employment of any audit team member for three months following completion of the audit, without KPMG consent. The Committee will receive an update if any senior audit team members are r ecruited by Experian, and an annual update in Mar ch providing numbers of f ormer auditor employees currently emplo yed by Experian. The Board is r esponsible for maintaining and monitoring sound risk management and internal control systems, and for determining the nature and extent of the principal risk s Experian is willing to take to achieve its strategic objectives. There is an ongoing process for identifying, evaluating and managing the principal and emerging risk s we face. This process was in place for the ﬁnancial year and up to the date of approv al of this Annual Report. F ull details of our risk management and internal control systems and processes c an be found in the Risk management section of the Strategic r eport on page 73. The Audit Committee considers emerging risk s with management as part of the standing risk management update it receives. During the year , as well as management-identiﬁed emer ging risks, the Committee asked management to evaluate certain risks as potential emer ging risks. The speciﬁc processes underlying the elements of our risk framework ar e set out below. Identify Identify and escalate new , emerging or changing risks, signiﬁcant incidents, signiﬁc ant control gaps and risk acceptance Consider external factors arising from our oper ating environment and internal risks arising from the natur e of our business, our controls and pr ocesses, and our management decisions Assess Assess the potential impact of each strategic, operational and ﬁnancial risk on the achievement of our business objectives, and the Group’s corr esponding risk appetite Produce Board-level and Gr oup-level ﬁnance reports, including ﬁnancial summaries, r esults, f orecasts and r evenue trends, investor relations analy sis and detailed business trading summaries Follow formal r eview and approv al procedur es for major transactions, capital expenditure and revenue expenditur e Evaluate compliance with policies and standar ds that address risk management, compliance, accounting, treasury management, fr aud, information security and business continuity Monitor budgetary and performance reviews tied to KPIs and achievement of objectives Conduct detailed performance reviews at a r egional level Report to Regional Risk Committees, the Security and Continuity Steering Committee, the Executive Risk Management Committee, and the Audit Committee on the status of principal and emerging risks, the progr ess of strategic pr ojects and acquisitions, and escalation of signiﬁcant accepted risk s Global Internal Audit reports to the Audit Committee on assur ance testing and Conﬁdential Helpline investigation results Group Compliance reports to the Audit Committee on fr aud management Apply a risk scoring system, based on our assessment of the probability of a risk materialising, and its impact if it does Require executive management conﬁrmations of compliance with our corporate governance pr ocesses and control environment Respond Apply active risk remediation str ategies, including internal controls, formal exception pr ocesses, insur ance and specialised treasury instruments Use formal review and approv al procedur es for signiﬁcant accepted risks Accept or remediate current risk and contr ol envir onment Determine corrective action if requir ed Monitor Maintain comprehensive risk register s repr esenting the current risk and control envir onment, using a softw are solution to pr ovide enhanced monitoring Review of controls and follow-ups by management, second line functions such as Compliance, Global Internal Audit and thir d parties Use Global Internal Audit to independently assess the adequacy and eectiveness of the system of internal controls Report on risk to the Audit Committee, addr essing material and emerging risks, material litigation, information security , business continuity , and regulatory compliance Use the Audit Committee to monitor the Group’s risk management and internal control systems Review by the Audit Committee of the eectiveness of our systems of risk management and internal control Receive an annual report on the contr ols over relev ant risks Ongoing review of principal risks identiﬁed by the Gr oup’s risk assessment processes Risk management and internal control Code principle Audit, Risk and Internal Control Experian plc Governance 110 Risk management is essential in a global, innovation-driven business such as Experian. It helps to create long-term shar eholder value and protects our business, people, assets, c apital and reputation. It oper ates at all levels throughout the organisation, across r egions, business activities and operational support functions. Our approach to risk management encour ages clear decisions about which risks we take and how we manage them, based on an understanding of their potential str ategic, commercial, ﬁnancial, compliance, legal and reputational impact. As risk management and internal control systems ar e designed to manage rather than eliminate the risk of failur e to achieve business objectives, they c an pro vide reasonable but not absolute assur ance against material ﬁnancial misstatement or loss. In line with the Code, the Audit Committee monitors our risk management and internal control systems, robustly assesses the principal risks identiﬁed by our risk assessment pr ocesses (including those that would threaten our business model, futur e performance, solvency or liquidity), and monitors actions taken to mitigate them. F or certain joint arrangements, the Board relies on the systems of internal control oper ating within Experian partners’ infr astructure and the obligations of partners’ boards, relating to the eectiveness of their own systems. The Code requir es companies to review the eectiveness of their risk management and internal control systems, at least annually . The Audit Committee performs this review under delegated authority from the Boar d. F ollowing this year’s review , the Boar d considers that the information it receiv ed enabled it to review the eectiveness of the Group’s system of internal contr ol in accordance with the FRC’s ‘Guidance on Risk Management, Internal Control and Related Financial and Business Reporting’ and conﬁrm that the system has no signiﬁcant failings or weaknesses. F or more on our appr oach to risk management see pages 72 to 80. Thr ough a co mbinat ion of ongoing and annual reviews, the B oard is a ble to rev iew the eec tiveness of the Group’ s risk man agement and i nterna l contro l syste ms Additional ﬁnancial r eporting internalcontr ols We ha ve detailed policies and procedur es in place to ensure the accur acy and reliability of our ﬁnancial reporting and the pr eparation of Group ﬁnancial statements. This includes our comprehensive Global Accounting Policy and Standards, which contains the detailed requir ements of International Financial Reporting Standards (IFRS). The Group’s Financial Reporting team owns the Global Accounting Policy and Standards and we ha ve rolled it out acr oss the Group, obliging all Group companies to follow its requir ements. The main objectives of the Policy and Standards ar e to: provide standar ds for accounting issues and to act as a refer ence document for both Experian employees and external auditors; allow for prepar ation of consistent and well-deﬁned information for ﬁnancial reporting requir ements under IFRS; provide a set of measures to be used for both quantitative and qualitative assessments of Group performance; increase the eciency of the r eporting process; and provide a guide for educ ating Group personnel in approv ed standardised ﬁnance and accounting procedur es. Risk management and internal contr ol systems r eview Independent assessment Global Internal Audit reports Global Internal Audit Conﬁdential Helpline reports External auditor’s report Sustainable business independent assurance r eport Review by relev ant regulatory bodies (e.g. US Consumer Financial Protection Bur eau) Evaluation of e xternal auditor Evaluation of Global Internal A udit Management assur ance Annual executive certiﬁcation of compliance with UK FRC guidance and control adequacy Risk management reports, including material litigation Compliance reports Information security reports Impairment, going concern and viability r eviews Annual Report, ful l-y ear and half-yearly ﬁnancial report r eview Management repr esentation letters Board/Audit Committee appr oved Annual Global Internal Audit plan External auditor’s engagement letter External auditor’s annual audit plan T reasury policy T ax policy Compliance policy Global Delegated Authorities Matrix, which deﬁnes internal approv al procedur es Audit Committee report contin ued Code principle Audit, Risk and Internal Control 111 Experian plc Annual Report 2021 Gover nance Report on dir ectors’ remuner ation FY21 was undoubtedly an unprecedented year for our business, our employees, and the societies in which we operate. The emergence of the global COVID-19 pandemic, and the subsequent national lockdowns in all our major markets, created a dr astically dier ent operating en vironment than the one that we had planned for . W e had to adapt quickly to the many unique and unforeseen chal lenges that faced our business and our employees. I would therefor e like to start by thanking all our 17,800 employees whose resilience and commitment enabled us to deliver another year of growth. I am proud of how the Company approached this y ear . F rom the very beginning of the pandemic we were clear that our priority was to protect our people and our business. By doing this, we established a platform from which to emer ge stronger fr om the pandemic and help all our stakeholders and national governments along the way . Protecting our people Protecting our people, not just their mental and physical well -being but their jobs too, has been one of our key priorities throughout the pandemic. Driven by the backdrop of CO VID-19, we took a prudent decision to apply a global pay freeze to all employees, including executive director s, for FY21 in order to enhance our ability to preserve the jobs of all our workfor ce. It is pleasing to report that our prudence paid o, and that in FY21: We did not furlough an y of our employees, or avail of any similar government support in any of the countries in which we oper ate. We did not r educe any employees’ salaries or working hours We hav e maintained our global level of employment at c.17,800 throughout COVID-19 F or FY22 we will once again be operating our normal merit review pr ocess, f or which all employees will be eligible. The vast majority of employees continue to work from home in a safe and ecient way , supported by a number of 'people ﬁrst' policiesdesigned to help employees and their families to navigate the current en vironment. We r eviewed and enhanced a number of our people policies in FY21, to ensur e that we could support our employees as they dealt with the challenges, both per sonal and professional, of the pandemic. W e expanded some of our existing well-being pr ogrammes to include stress management, mindfulness and meditation as well as broader mental health support. W e also enhanced some of our leave policies, for example in the UK&I we I am pleased to pre sent, on behalf of the Remuneration Commit tee, the Repor t on directors’ remuneration, following a challenging year , bu t one of resilient per formance for the C ompany . George Rose Chairman of the Remuner ation Committee Members George Rose (Chairman) Dr Ruba Borno Alison Brittain Caroline Donahue Luiz Fleury Jonathan Howell Deirdr e Mahlan Mike Rogers * From 1 May 2021 doubled our car er’s leave to ten days and provided enhanced sick pay for emplo yees with COVID-19, irrespective of their tenur e. Like a lot of society , our employ ees had to deal with personal and professional chal lenges for the whole of FY21. With both admiration and sincere gr atitude we witnessed the incredible eorts shown by all our employees as they supported each other through the pandemic. As a way of saying thank you for this exceptional eort, we will be making a special one-o recognition awar d to all our employees below senior management, appr oximately 17,000 employees, for helping Experian to thrive during the pandemic. The initial award will be a shar e award of US$700 and we will match the aw ard on a 2:1 basis (i.e. a further US$1,400) for an y employee who retains their initial shar e award for a period of three year s. Once again this year I had the opportunity to meet – albeit necessarily virtually – with our UK and Ireland Experian People F orum. These meetings are alway s an informative engagement opportunity to discuss a variety of topics that are close to the hearts of our employees. I was very pleased to hear very positive feedback on the actions that had been taken to help support our employees thr ough the pandemic. There was a sense that virtual working gave a greater insight into every one’s personal circumstances, which has actually further ‘humanised’ our leaders and enhanced the strong collaboration aspect of the Experian cultur e. Protecting our business and r especting our investor s Our strategy continues to be focused on maximising our long-term growth potential. The emergence of the pandemic in Mar ch 2020 came as the pr evious ﬁnancial year was closing out. Despite the uncertainty br ought about by COVID-19 our ambition remained unchanged. Therefor e, we decided to push forward with a number of planned critical str ategic investments in FY21. Those investments in areas such as business portfolio and technology infrastructur e are designed to further fuel the sustainability of the business to meet our longer-term aspir ations. W e were pleased to be in a position to pay , in the normal way , both our FY20 second interim dividend in July 2020 and our FY21 ﬁrst interim dividend in F ebruary 2021. Our shar e price, which has remained r esilient over FY21, continues to reﬂect the positive investor sentiment in ho w our Board, management team and employees have responded to the challenges of delivering business performance and growth during the pandemic. Code principle Remuneration Quick link experianplc.com/ about-us/ corporate-governance/ board-committees/ Experian plc Governance 112 Report on director s’ remuner ation contin ued Supporting governments and society As a Company we believe that we should help and contribute to the societies in which we work, and while this social r esponsibility is central to man y of our annual activities, it was brought into focus even mor e in FY21. We mobilised our business quickly to pr ovide governments and non-proﬁt or ganisations with our tools and resour ces to help deal with the crisis. W e are pr oud to say that this enabled national governments to direct ﬁnancial support to the businesses and individuals who needed it most. On the subject of government support, I want to conﬁrm that Experian did not look to secure any government support, in an y of the countries in which we operate. We did not av ail of any furloughing progr ammes or any other national support progr ammes. Executiv e director s Our Remuner ation Policy (Policy) is built on the principles that (i) executives are only r ewarded for delivering strong ﬁnancial r esults and (ii) executive pay is aligned with stakeholder experience. T rue to these principles, the Committee determined that for FY21: executive directors did not r eceive any salary increases; no adjustments would be made to outstanding long-term incentive (L TI) awar ds. All outstanding L TI awar ds will be assessed against the already disclosed performance conditions, with no adjustments to account for the impact of COVID-19; and 2020 L TI performance tar gets were set to balance the known impact of the pandemic at the time of grant with our longer -term unchanged growth ambitions. Additionally , in r ecognition of the prev ailing uncertainty and to acknowledge the dicult economic circumstances cr eated by COVID-19 on the wider economy , our executive dir ectors voluntarily waived 25% of their contr actual base salary for six months in FY21. The Committee supported this decision and determined it would be appropriate to donate an amount equal to the value of salary waived by the executive director s to the Experian Hardship F unds across the Group. These Employee Hardship F unds are used to provide ﬁnancial support to Experian employees in cases of extr eme diculty , such as when their homes were damaged or destr oyed by ﬂooding or wildﬁres. Most recently , the Experian Hardship funds have been utilised to pr ovide our employees in India with additional ﬁnancial hardship support, enabling them to access funds quickly for medical expenses, temporary housing and any other urgent needs. Experian’s ex ecutive remuner ation policy Since the 2017 Remuner ation Policy (Policy) vote, we ha ve engaged proactively with our shareholders. Based on the valuable feedback received, we have made a series of changes and additional reﬁnements over the last four years to further impr ove our executive remuner ation structure. It was pleasing to see the strong level of shar eholder support we received, for both our Policy and Remuneration Report, at the 2020 A GM. As we disclosed in last year's Report on Directors' R emuneration (RDR), the Committee considered it was appr opriate to delay setting and disclosing 2020 L TI plan tar gets until later in 2020, when ther e was more clarity on the business impact of the global pandemic. The decision to delay setting 2020 L TI tar gets was driven by the Committee’s strong prefer ence to set meaningful targets that wer e stretching but attainable even in the pr evailing uncertain economic environment, rather than Inve stors Execut ives Employee s Exp erian Group Dividends of USc32.5 and USc14.5per share paid in July 2020 and F ebruary 2021, respectively Share price stability , 11% incr ease 1 in FY21 No shareholder capital r aising Pay fr eeze applied for FY21 Executive directors v oluntarily waived 25% of their base salaries for six months in FY21 No adjustments to in-ﬂight L TI awar ds No furloughing of sta Global employment maintained at 17,800 Pay fr eeze but no reductions to employ ee salary in FY21 No forced annual leave or r educed working hours Normal bonus entitlement for FY20 and FY21 Enhanced ﬂexible working from home, to better support personal circumstances 97% employees globally working from home in FY21 3.2% global pay increase budget for FY22 US$700 Thank Y ou Share A ward with a further 2-for-1 matching opportunity No ﬁnancial government support taken in any of our oper ating regions Protected str ategic investments and executed all planned acquisitions to support futur e growth Experian is proud to have been in a position to pr ovide pro bono support to national governments to enable COVID-19 relief to be dir ected to those most in need Stakeholder experienc e in FY21 1 Share price is the 12-month average to 1 April 2021 compar ed to 12-month average to 1 April 2020. Code principle Remuneration 113 Experian plc Annual Report 2021 Gover nance Q&A Q: Can you provide some insight on any additional factors that shaped the Committee’s thinking in setting FY21 incentive plan targets? Fr om the beginning of the pandemic, the Committee’s strong pr eference was to allo w the Remuner ation Policy to apply unadjusted, and not to apply discretion to any outstanding L TI awar ds. When 2020 L TI plan tar gets were set the vesting levels of the outstanding (2018 and 2019) L TI awar ds were – understandably – not anticipated to hit the projected pr e-COVID-19 levels. While the Committee were not intending to apply any discretion to those outstanding awards – in that their formulaic vesting levels would simply prev ail – it was felt inappropriate not to r eﬂect the known impact of the global pandemic when setting targets for the awar ds granted in 2020. Therefor e, the agreed 2020 L TI targets reﬂect the uncertainty and challenges of FY21 but, importantly , also our unchanged ambitions for the remainder of the thr ee-year performance period. The strength of our conviction is demonstrated by the decision to r etain our existing performance target r anges for three of the four metrics (Operating Cash Flo w , Return on Capital Employed and T otal Shareholder Return (TSR)) f or the 2020 L TI plan awards. In order to set a motivational but str etching target r ange for the Benchmark Earnings Per Share (EPS) metric, we blended the anticipated impact on earnings in FY21 with a return to pr evious target r anges for the remaining two year s of the three- year performance period. This resulted in an EPS performance range of 3% – 7% per y ear , over the three- year performance period, which is lower than our more r ecent performance ranges, but is still very stretching over the three- year period of the awards. We r emain committed to our principle that executives are only r ewarded for delivering strong ﬁnancial r esults and outturns that are in our shareholders' best inter ests. W e believe that the 2020 L TI performance r ange, which was set on a one-o basis, r eﬂects this approach. It is also worth noting that a signiﬁcant number of the plan participants are US-based. Therefor e the ability to set credible, motivational targets pla ys an important role in the retention of key talent in the v ery dynamic US external market of data information and technology companies. Q: Have you made any redundancies as a result of COVID-19? No. In line with our normal pr actice we made changes to our business portfolio during the year and continued with organisation and technology transformation activities planned or announced in advance of FY21, and the onset of COVID-19. Overall we maintained the same total number of employees for this ﬁnancial year as the pr evious one. As part of the implementation of an y transformational activities, and as is our normal practice, we sought opportunities to redeploy employees wherever possible, and where this wasn’t feasible employees wer e provided with additional support, including enhanced severance terms, adjustment periods recognising loc al pandemic-related r estrictions and outplacement resour ces. Q: Has Experian considered incorporating Environmental, Social and Gov ernance (ESG) metrics into the executive incentive plans? In recent months a clear ‘dir ection of tra vel’ has emerged, with more in vestors r aising this particular query . T o date, we have felt that we have always tak en our ESG agenda seriously and with appropriate focus such that ther e has not been a perceived necessity to include an ESG metric in our incentive framework. In recent year s, we hav e consulted quite extensively on our performance metrics and the feedback from those engagements has shaped our current fr amework. As with any metric to be considered for inclusion in our incentive framework, we look for a strong strategic alignment and something that resonates with the Company's purpose. We will begin to discuss this topic in mor e depth in the coming year and consider how the important aspects of ESG should shape our remuner ation arrangements. Q: What is Experian’s plan for aligning UK -based executiv e director pension provisions with the majority of the UK workforce? In line with our 2020 Remuner ation Policy , any new UK -based executive director appointments would receive a c ash pension allowance or pension contribution that is aligned with the majority of the wider UK employee workfor ce (currently an employer contribution of 10% of base salary). Fr om 1 January 2023, the cash pension allowance of our incumbent UK -based executive director s (currently 20% of base salary) will be reduced to a c ash pension allowance of 10% of base salary to align to the employer pension contribution of the majority of the wider UK employee workfor ce. Code principle Remuneration relying on the Committee’s discr etion to determine how much, if an y , of the 2020 L TI awards would vest. We felt that this was a mor e transpar ent approach and we were pleased to receive investor s' support for taking the additional time to set L TI tar gets that would be more motivational fr om the outset. The Committee ﬁrst discussed a set of preliminary 2020 L TI targets at an ad-hoc meeting in September 2020. After further discussion, the ﬁnalised tar gets were agr eed at the November 2020 meeting, and shortl y afterwards we r eleased a RNS announcement to conﬁrm the full performance range that would apply to the 2020 L TI awar ds. At that time, we also issued a letter , to our major shareholders and the pr oxy advisory bodies, that pr ovided them with some of the additional context outlined above. W e were pleased with both the engagement and the support we received fr om investors in r esponse to this letter . We continue to v alue the open and constructive nature of our shar eholder engagement over recent year s. It has been encour aging to receive feedback about the frequency and pr oactive spirit in which we engage. F or full transparency we have pro vided the additional context we shared with investor s in November 2020, and also some details on the key questions from shareholder discussions since then. Experian plc Governance 114 Report on director s’ remuner ation contin ued FY21 performance FY21 at a glance Annual performance 7% revenue gr owth 3% Benchmark EBIT growth Stable 17,800 headcount 1 Three-year performance 22% cumulative PBT per share gr owth 61% share price gr owth 2 US$4.2bn cumulative benchmark operating c ash ﬂow over thr ee years 7% aver age increase per annum in adjusted Benchmark EPS At constant currency r ates 1 Headcount as at 31 March 2021 (31 March 2020: 17,800). 2 Three-month average to 31 Mar ch 2021 of £25.58 compared to the three-month a verage to 31 March 2018 of £15.90. I am pleased to report that FY21 was a year of resilient and str ong performance for Experian. The emergence of COVID-19 at the beginning of the ﬁnancial year had a signiﬁcant impact on our global operating en vironment, as national lockdowns were intr oduced in all our major markets. Despite the unprecedented challenges of FY21, the Gr oup delivered gr owth across all our key ﬁnancial metrics. Continuing to achieve growth in such economic cir cumstances reﬂects the r obustness of our business strategy and importantly the ability to execute that strategy . In FY21, the Gr oup achieved 7% total rev enue growth, as well as strong levels of growth in Benchmark PBT per share 4% and Benchmark EPS 4%. F urthermore, these r esults are supported by a strong oper ating cash ﬂow . It was undoubtedly a very dierent y ear for many businesses, and we took very conscious steps to ensure that we pr otected our people and our key str ategic investments. With that backdr op, still being able to deliver positive Benchmark EBIT gro wth of 3% for FY21 is a reﬂection of both the resilience of our business and the commitment of our people. Our shar e price demonstrated a similar degr ee of resilience, as it remained stable over FY21. Whilst the delivery of ﬁnancial results is undoubtedly very important, the Committee actively undertakes a holistic appr oach to the assessment of the Company’s performance by reviewing a br oad range of metrics. These include – but not exclusively – employee engagement, diver sity and inclusion, impact on the environment and consumer satisfaction. For FY21, ther e was even gr eater emphasis on the stakeholder experience of our employees and our investors during this pandemic year . The Committee’s broader r eview of performance is always important to ensur e that the ﬁnancial outturns are a fair and true reﬂection of the Gr oup’s over all performance over the period. Ha ving considered a number of additional non-ﬁnancial measures and the stakeholder experience at its May 2021 meeting, the Committee was satisﬁed that the Company’s ﬁnancial performance was aligned with its holistic assessment of performance over the period. How is our performance reﬂected in executiv e pay? Salary : the Committee applied a pay freeze to executive director salaries for FY21. However , in recognition of the pr evailing uncertainty and to acknowledge the dicult economic circumstances cr eated by COVID-19 in the wider economy , each of the executive dir ectors voluntarily waived 25% of their salary for six months in FY21. The Company determined it would be appropriate to donate a value equal to the salary waived by the executive dir ectors to the Experian Employee Hardship F unds. Annual Bonus : the Committee always seeks to set stretching but attainable annual bonus performance targets that r eﬂect our strong pay-for -performance philosophy . Incentivising the delivery of both EBIT and Revenue gr owth remained cor e to our ambitions, howev er being able to maintain the 'attainable' , and hence motivational, aspect of the targets was mor e challenging given the level of prev ailing uncertainty . Admittedly , those ambitions wer e rightly tempered by the need to pr otect jobs and maintain strategic in vestments, both of which were critic al objectives for the Board as part of navigating this pandemic year . In FY21 both North America and Latin America once again delivered outstanding, high single-digit organic r evenue growth, which built upon the resilient r evenue performance in our other regions to deliver Gr oup revenue performance growth, for annual bonus purposes of 5.8% (further information on page 120). This strong r evenue performance, combined with returns on str ategic investments and prudent ﬁnancial management of expenses, ensur ed that this top-line growth ﬂowed through to the Benchmark EBIT outturn for the year which, for annual bonus purposes, grew by 2.7%. F ollowing a review of the Gr oup’s ﬁnancial performance and consideration of all business priorities, including those non-ﬁnancial in nature, and having r eﬂected on the assumptions underpinning the performance targets, the executive dir ectors proposed an adjustment to the performance range. This resulted in a degr ee of downwar d discretion against the formulaic outturn. As a result of the combined r evenue performance and Benchmark EBIT gr owth the over all bonus for FY21 will be paid out at 91.3% of maximum for each of the executive director s. Thre shold 25% Ta r g e t 50% Actual 91.3% Maximum 10 0 % The Committee was satisﬁed that the revised level of bonus payout aligned fairly and accurately to the y ear’s achievements. Therefor e, no further discretion (upwar d or downwar d) was deemed necessary . F ull details of the annual bonus outcomes are set out in the Annual report on dir ectors’ remuner ation. Long-term Incentives : The Performance Shar e Plan (PSP) and Co-investment Plan (CIP) awards gr anted in 2018 will vest on 7 June 2021. The resilient ﬁnancial performance in FY21 follows the str ong performance of both FY19 and FY20. Over the last thr ee years, Experian has achieved: 7% aver age increase per annum in adjusted Benchmark EPS US$4.2bn cumulative Benchmark operating cash ﬂow over thr ee years 22% cumulative Benchmark PBT gro wth 61% share price gr owth over three y ears These strong gr owth ﬁgures underpin the £80 £10 0 £ 120 £14 0 £16 0 £18 0 £200 E xper ian 3-year TS R rel ative to F TSE 1 0 0 Ind ex March 2 018 September 2 018 March 2 019 September 2 019 March 2020 September 2020 March 2021 Ex perian F TSE 100 Inde x Code principle Remuneration 115 Experian plc Annual Report 2021 Gover nance over all vesting levels of the PSP and of the CIP , which were 80% and 87% r espectively . Whilst the impact of the pandemic in the ﬁnal year of the performance period undoubtedly aected the potential performance outcomes that may have otherwise been achieved in FY21, no adjustments were made in assessing the performance outturns for the 2018 L TI plans. As with the annual bonus plan, the Committee considered the L TI vesting levels in the context of the current economic envir onment , and determined the formulaic vesting levels to be an appropriate r eﬂection of the strong business growth achieved over the thr ee-year performance period. In line with our remuner ation principles, a substantial portion of the CEO’s single ﬁgure value is determined by long-term performance. F or FY21 62% of the CEO’s single ﬁgure value is driven by the vesting levels of the L TI plans. Importantly , despite the pr evailing economic uncertainty 18% of the total FY21 single ﬁgure value for the executive dir ectors is dir ectly attributable to share price gr owth and dividends. All shar eholders, including shareholder employees, will also have beneﬁtted from this same shar e price growth and dividend return over the same thr ee-year period. Pa y in the wider workfor ce Employee engagement As I mentioned in my 2020 statement, we ha ve always felt well informed about the pay and related policy arr angements for the broader employee population at Experian. As the Committee had existing processes in place to gain an extensive understanding of employee pay , prior to the intr oduction of the 2018 UK Corporate Gov ernance Code (the Code) requir ements, no single appr oach recommended in the Code was consider ed appropriate for our business. We have ther efor e adopted a combination of the suggested methods to comply with the Code’s requir ements. Each year , as part of the Committee’s standing agenda, we ar e pro vided with an extensive paper setting out details of all-employee pay and workforce policies acr oss Experian. The discussions on this topic have enabled us to proactively incorpor ate wider employee pay as important context for fr aming executive pay considerations. This year , at the Committee’s request, we reviewed an additional paper providing gr eater insights into the remuner ation and beneﬁt arrangements, including gender pay positioning, in our major r egions. The Committee were also pr ovided with an update on a number of the policy enhancements and additional progr ammes introduced to support employees' well -being over the course of the COVID-19 pandemic. Understandably some of these policies varied by jurisdiction, however – as an e xample – some of the policies introduced to support our UK employees during the pandemic include: UK COVID-19 steps 99% UK employees working from home US$700 Thank Y ou Share A ward with a further 2-for-1 matching opportunity Normal bonus entitlement for FY20 and FY21 Extended carer's leave (doubled fr om ﬁve days to ten days) Full sick pay f or all employees with COVID-19, regar dless of tenure Flu vaccination vouchers av ailable to all employees Enhanced access to Bupa medical car e from home Virtual well-being and mindfulness sessions As I mentioned previously , I had the opportunity to further supplement the Committee’s understanding of the pay and related policies for the broader workfor ce by attending our virtual UK and Ireland Experian People F orum. I was very pleased that the virtual nature of the F orum this year didn’t hinder the level of engagement from employees and I f ound the two-way nature of the discussions to be v ery insightful. In the course of my discussions with the F orum it was clear that employees appreciated the open and honest communications r eceived from senior leaders ov er the year . The feedback was that this transpar ency provided further comfort to employees that Experian would continue to protect both their jobs and their well-being, over the course of the pandemic. It was equally clear that employees continue to value our current r eward oering, and that the additional beneﬁts, such as critic al illness cover and access to personalised ﬁnancial well-being advice, which wer e introduced on the back of the UK T otal Rewar ds Optimisation project wer e very well received. People and cultur e Creating an agile, innovative, high-performance culture has been, and continues to be, a huge focus for Experian as we look to maintain and further develop an environment that enables our employees to thrive and be successful. The Experian W ay , our unique and consistent way of working globally , informs how our people act and behave, thus shaping our culture. Experian’s culture is a k ey enabler of our success and this was clear to see in FY21. The resilient performance deliver ed this year is a true testament to the strong collabor ative culture at Experian, and the vibr ancy of The Experian W ay . The vibrancy play s out in many ways, one of which is our focus on innovation, which fuels the exploration of new opportunities and r apidly pivots our business to meet our clients' evolving needs. The collegiate nature of The Experian W ay generated via our connected global network enabled us to deliver better results and leverage solutions acr oss the Group – even though globally 97% of our employees understandably worked fr om home for the full ﬁnancial year . The Committee takes a keen inter est in the health of the Company’s culture and is r egularly updated on the KPIs used to track and monitor Experian’s culture, including its People Survey results, Employee Engagement Scor e and our Net Promoter Scor e. F or FY21, driven in part by the uncertainty of the global pandemic we replaced the annual People Survey with monthly , and then quarterly , pulse surveys. The ability to quickly identify and respond to some of the new and emer ging challenges facing our employees pro ved invaluable in the development and pr ovision of appropriate support for all our workfor ce. We appr eciate that measuring culture is dicult but we have disclosed on the following page some quantitative culture-r elated data that we use to inform our own assessment on our culture, which can also help inform our investors and other stakeholder s. Code principle Remuneration Experian plc Governance 116 Looking forward As we begin to emerge fr om an unprecedented year , we do so with a lot of positive momentum. Whilst the impact of the global pandemic is not yet behind us, we have a greater degr ee of certainty in the economic outlook compared with this time last year . The resilience, shown by both our business and our employees in FY21, stands us in gr eat stead for futur e years. Our business strategy and our ambition to continue to deliver future gr owth remains unchanged. At the onset of the pandemic we made the decision to stay the course and did not make any changes to our Remuner ation Policy or the metrics we use to assess performance. As I mentioned in last year's Report on directors’ remuner ation, we believed then and we continue to believe now that this Policy is the best ﬁt for our business and is a key contributor to the achievement of our strong ﬁnancial results. In FY21, despite 97% of our global workfor ce working remotely , our employees maintained their productivity , creativity and collabor ation to deliver a strong r esilient ﬁnancial performance. It is encouraging to hear positive employ ee feedback on the steps taken to support our workforce thr ough the pandemic. I look forward to seeing how the experiences and learnings from this year will enable us to emer ge strongly and take greater adv antage of the return to a more normal oper ating environment. As I have said previously , we will continue to listen to and act on feedback from our shareholders, including how the important aspects of ESG should shape the metrics included in our remuner ation approach. The inclusion of any metrics in our incentive framework is driven by their alignment to our strategic business objectives and our purpose of creating a better tomorr ow for our customers, our clients, our employees and our shareholders. As always, we will engage with and seek feedback from our shar eholders and the proxy advisory bodies as we consider an y potential changes. In closing, I hope that I hav e provided some helpful insight and broader context on Experian's FY21 performance, that enables shareholders to support our Annual r eport on directors’ r emuneration at the 2021 AGM. V oluntary turnover 10.1% 11.6% 12.3% Involuntary turnover 6.3% 7.2% 8.5% T otal turnover 16.4% 18.8% 20.8% Full -time 93% 94% 93% Part -time 3% 2% 3% T emporary employ ees 4% 4% 4% Contractor s 0% 0% 0% Calculations based on the total number of permanent employees, ﬁxed-term employ ees, contingent workers andindependent contractors in FY21. The vast majority of our workfor ce is employed on a full-time basis by the Company , which fuels and ampliﬁes our collaborative cultur e that employees continue to give very positive feedback on. Our employees receive a compr ehensive beneﬁts package, tailor ed to the region in which the individual is employed. W e augment our permanent employees with a small number of temporary employ ees to enable us to respond quickly to speciﬁc client needs or broader business r equirements. Senior leaders - women 32% 30% 31% T otal workforce - women 44 % 44 % 4 4% 2021 2020 2019 2021 2020 2019 2021 2020 2019 Experian attrition Experian employ ee composition headcount by employ ee type Experian diversity Partly as a r esult of our strong, collaborative working culture, which came to the for e in this pandemic year , employ ee turnover was comparatively lo w across the r egions in which we operate. Our 2021 involuntary turnover was at its lowest level in r ecent years r eﬂecting our focus on protecting jobs throughout the pandemic. As disclosed above, we have not made any r edundancies as a result of COVID-19. The involuntary turnover for 2021 is driven by a combination of an employee's performance or cultur al ﬁt not aligning with Experian’s expectations together with a small proportion of agr eed transformational activities being actioned later than originally planned due to the emergence of the global pandemic. We str ongly believe that diversity throughout the Group is a driver of business success and are working har d to reﬂect in our workfor ce the diversity of our customers, clients and the societies in which we operate. In the coming year we will be undertaking our ﬁrst global employee census. This census is the ﬁrst, very important, step to enable us to better understand and develop our diversity . One of our priorities is to nurture our talent pipeline and while we’re making strides in the right direction, we know we need to do more to increase the level of r epresentation of women at senior levels. We are working very proactively to addr ess this, including setting a target of women r epresenting 40% of our senior leaders by 2024. For detailed information on diversity at Experian please see page 49. Report on director s’ remuner ation contin ued Code principle Remuneration 117 Experian plc Annual Report 2021 Gover nance Annual report on director s’ remuner ation 7 % Revenue performance 3 % Benchmark EBIT gro wth USc 1 0 3 .1 Benchmark EPS 15 % Return on capital employ ed 83 % Employee well-being Performance measure Incentive plan Outturn Achievement (% of max) Benchmark EBIT growth Annual bonus 2.7% 1 90% Revenue performance gr owth Annual bonus 5.8% 1 97% Three-y ear Benchmark PBT per shar e growth CIP/PSP 7.4% 73% Three-y ear cumulative Benchmark operating c ash ﬂow* CIP US$4.2bn 100% Three-y ear TSR relativ e to FTSE 100 Index PSP 65% 100% 1 For annual bonus purposes, see further information on page 120. * At constant exchange rates. ** Positive employee response to a global people survey question on the level of support pr ovided by Experian during the pandemic. As a result of the performance shown abov e, the 2018 PSP vested at 80%, and the 2018 CIP vested at 87%. 80% Benchmark EBIT 20% Revenue 50% Adjusted Benchmark EPS 50% Cumulative Benchmark operating cash ﬂow 50% Adjusted Benchmark EPS 25% ROCE 25% TSR Performance snapshot Executive dir ector single ﬁgure of pay Incentive awards timelines Executive dir ector remuner ation arrangements for FY21 No salary increases awar ded to executive dir ectors for FY21. Pension contributions for new UK executive dir ector appointments aligned with workforce immediately and incumbent executiv e directors will be aligned by the end of 2022. Annual bonus based on Benchmark EBIT (80%) and revenue performance (20%). The opportunity is 200% of base salary . Half of any payout must be deferr ed into the CIP for three y ears. CIP awards will be based on cumulative Benchmark oper ating cash ﬂow (50%) and adjusted Benchmark EPS (50%). The maximum award r emains a 2:1 match. PSP awards will be based on TSR (25%), ROCE (25%) and adjusted Benchmark EPS (50%) performance. The opportunity of 200% of base salary is unchanged. CIP and PSP awards will be subject to an additional two- year holding period. All incentive awards ar e subject to malus and clawback provisions. Existing in-employment shareholding guidelines will apply for two years post-emplo yment. The CIP is designed to incentivise cash discipline while the PSP is designed to incentivise shareholder r eturns. Revenue growth is a key metric for us and will provide a quality of earnings balance to the important proﬁt focus of Benchmark EBIT . However , growth is the single most important aspect of our business strategy and therefor e adjusted Benchmark EPS runs across both plans. Our executive pa y framework Annual bonus CIP PSP Our executive r emuner ation at a glance Share ownership As at 31 March 2021 and calculated as outlined on page 127. Guideline Additional holding Bri a n Ca ss in A ctual holding 13 .5 x sa l ar y Ll oy d Pitchf or d A ctual ho l ding 1 1.6 x sa l ar y K e rry Wi l li a ms A ctual ho l ding 4 .9 x sa l ar y 1 0.5 3 9.6 2 2.9 2 Brian Cassin £7.6m Lloyd Pitchfor d £4.7m Kerry Williams US$8.0m 0 2,000 4,000 6,000 8,000 10,000 Fixed elements of pay: Base salary Pension and beneﬁts V ariable elements of pay: Annual bonus Share-based incentives: value at grant Share-based incentives: value attributable to shar e price growth and dividend equivalent payments ’000 Grant Y ear 1 Y ear 2 Y ear 3 Y ear 4 Y ear 5 Y ear 6 Annual bonus CIP PSP Performance period Holding period 2 9.6 3 10.5 2 2.9 Code principle Remuneration Experian plc Governance 118 Annual report on director s’ remuner ation contin ued This Annual report on dir ectors’ remuner ation will be put to shareholders for an advisory vote at the AGM on 21 July 2021. The Remuneration Committee has prepar ed it on behalf of the Board in line with the UK Companies Act 2006, Schedule 8 to the UK Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (as amended) and the Listing Rules of the UK Financial Conduct Authority . All of the sections which have been audited by the Company’s external auditor , KPMG , ha ve been noted. What did we pay our ex ecutive directors in the y ear? (audited) The table below shows the single total ﬁgur e of remuner ation for the executive dir ectors, for the years ended 31 Mar ch 2021 and 31 March 2020. Further explanatory information is set out below the table. Brian Cassin Lloyd Pitchford Kerry Williams 2021 £’000 2020 £’000 2021 £’000 2020 £’000 2021 US$’000 2020 US$’000 Fixed pay Gross salary 1,2 973 968 600 597 1,028 1,026 Salary waived 1,2 (122) – (75) – (128) – Post-waiv er salary 851 968 525 597 900 1,026 Post-waiv er salary 851 968 525 597 900 1,026 Beneﬁts 24 24 23 23 42 41 Pension 194 194 120 119 10 11 T otal ﬁxed pay 1,069 1,186 668 739 952 1,078 Performance-related pay Annual bonus 3 1,776 1,549 1,096 956 1,872 1,632 Share-based incentives 4 V alue delivered thr ough performance 5 3,351 4,545 2,067 2,803 3,638 4,709 V alue delivered thr ough share price growth anddividends 6 1,364 3,556 841 2,192 1,467 3,691 T otal variable pay 6,491 9,650 4,004 5,951 6,977 10,032 T otal single ﬁgure of remuner ation 7,560 10,836 4,672 6,690 7,929 11,110 1 In FY21 our executive directors voluntarily waived 25% of their contractual base salary f or six months. Gross salary is the base salary the e xecutives would have received if they had not waived entitlement to a portion of their salary in FY21. The amounts of salary waived by Brian Cassin, Lloyd Pitchford and Kerry Williams in FY21 were £121,562, £75,000, and US$128,125 r espectively . 2 For Kerry Williams, the salary also reﬂects the timing of US payr oll payments. 3 The FY21 annual bonus opportunity is calculated as a percentage of the executive director’s contractual annual base salary . Brian Cassin, Lloyd Pitchford and Kerry Williams’ FY21 annual bonus entitlements were calculated on their contractual base salary amounts for the y ear of £972,500, £600,000 and US$1,025,000 r espectively . 4 None of the executive directors exercised shar e options in the years ended 31 March 2021 or 31 Mar ch 2020. 5 Value delivered thr ough performance is calculated as the number of vested performance shar es multiplied by the share price on the date of gr ant. 6 For FY21, the value deliv ered through shar e price growth and dividends is calculated as (i) the dier ence between the average shar e price in the last three months of the ﬁnancial year and the shar e price on the date of grant multiplied by the number of vested performance shar es, plus (ii) dividend equivalent payments f or the number of vested performance shares. For 2020, this is calculated based on (i) the dierence between the share price on date of vest and the share price on the date of gr ant multiplied by the number of vested performance shares, plus (ii) dividend equivalent payments for the number of vested performance shares. How has the single ﬁgur e been calculated? (audited) Salary Salary increases typic ally take eect from 1 June. However due to the economic uncertainty with the emergence of the global pandemic, the Committee determined it would be prudent to apply a pay freeze for ex ecutive directors in FY21. That same prudence meant that a pay freeze was applied to all employees across the Gr oup and the ﬁnancial beneﬁt of that prudence enabled us to protect our employees and provide important support to them during this challenging year . In FY21, it is important to note that we did not apply an y salary reductions to any of our employ ees. W e did not furlough any employees, nor did we reduce any one's working hours, or f orce any taking of annual lea ve. In recognition of the pr evailing economic uncertainty and to acknowledge the dicult oper ating circumstances cr eated by COVID-19, our executive directors voluntarily w aived 25% of their contractual base salary for six months in FY21. The single ﬁgure repr esents the salary we paid to executive directors during the y ear , and as a r esult of the voluntary salary waivers their FY21 salary levels wer e lower than for FY20, as outlined below . 1 June 2020 ‘000 1 July – 31 December 2020 salary waiver ‘000 FY21 post-waiver salary ‘000 1 June 2019 ‘000 % increase Brian Cassin £973 £122 £851 £973 0% Lloyd Pitchford £600 £75 £525 £600 0% Kerry Williams US$1,028 US$128 US$900 US$1,025 0% Code principle Remuneration 119 Experian plc Annual Report 2021 Gover nance The value of salary voluntarily waived by Brian Cassin, Lloyd Pitchford and Kerry Williams was £121,562, £75,000, and US$128,125 respectively . It was decided that an amount equivalent to the value of salary waived by the ex ecutive directors should be donated to the Experian Employ ee Hardship F unds. These Funds ar e registered charitable organisations that support Experian employ ees globally by providing, for example, ﬁnancial assistance to those employees whose homes were damaged or destr oyed by ﬂooding or wildﬁres. Beneﬁts and pension T axable beneﬁts include life insur ance, priv ate healthcar e and a company car , or car allowance. Brian Cassin and Lloyd Pitchfor d are eligible to participate in a deﬁned contribution pension plan but elected not to do so during the year ended 31 Mar ch 2021. In 2021, Brian Cassin received a cash supplement of £194,500 (2020: £193,667), and Lloyd Pitchford r eceived a cash supplement of £120,000 (2020: £119,500), in lieu of their pension contributions. Kerry Williams participates in a deﬁned contribution plan (401k). The company contribution to this during the year was US$9,644 (2020: US$11,192). No executive director has a pr ospective right to a deﬁned beneﬁt pension. Annual bonus Overview All Experian employees participate in an annual bonus plan. W e have one annual bonus plan in operation across Experian and the majority of our workforce participate in this plan. The remainder of employees participate in a sales commission plan. How the annual bonus plan works varies slightly depending on region and gr ade. For the v ast majority of employees annual bonus awar ds are based on the performance of their particular business line or region. Executive director s are r equired to defer half of an y bonus earned for three year s through the CIP , although they may choose to def er more. This year , as in previous year s, all thr ee executive dir ectors chose to voluntarily defer their full bonus payments into the CIP . Our annual bonus plan is based upon two performance metrics, which ar e Benchmark EBIT growth (80% weighting) and revenue performance (20% weighting). Benchmark EBIT is an important earnings metric and focuses on items directly within management’s contr ol. T o balance the important proﬁt focus of Benchmark EBIT , revenue performance growth was added to the bonus plan in FY20 to pr ovide an important quality of earnings element. How do we set the bonus targets? Performance-related pa y is a key component of our rewar d structure for all employees and, as such, setting str etching targets is a critic al focus area for the Committee. E very year we undertake a rigor ous exercise to ensure that our tar gets are suciently str etching, taking into consider ation the external marketplace and our own performance aspir ations. The Committee is able to take a holistic approach to tar get setting as all our non-executive directors sit on the Remuner ation Committee, as wel l as on all of our other principal Board Committees. This ensures Committee members are fully apprised of the wider business context and the Gr oup’s business prospects over the coming y ears. As with many FTSE companies, our usual operating rhythm w as signiﬁcantly impacted by the onset of the global COVID-19 pandemic. When the Remuner ation Committee considered the potential annual bonus tar gets for FY21, the coronavirus outbr eak was in its early stages but dominating the landscape. It was incredibly dicult to pr edict the extent or duration of the pandemic and therefor e the setting of the annual bonus targets was done in the hope that clarity on the impact of the pandemic on the global economy would quickly emerge. However , the sc ale of the impact of COVID-19 was not quickly appar ent so the annual bonus targets wer e set with a backdrop of signiﬁc ant uncertainty . The Committee stuck to its principle of setting stretching but attainable performance tar gets that reﬂect our str ong pay-for-performance philosophy . The challenge was to preserve the r equired motiv ational aspect of the targets in an unpr edictable economic envir onment. It appear ed to be very unlikely that we could – with credibility – set tar gets that took no account of the economic conditions and also give us the ability to deliver on the critical objectives of protecting jobs, supporting employees and maintaining str ategic investments during the pandemic. The outlook was very uncertain as national lockdowns continued and vaccine development was in its infancy , but we made no changes to the annual bonus performance metrics in order to maintain our str ategic focus on both revenue performance and EBIT gr owth. The targets r eﬂected our philosophy of not rewar ding negative growth – ev en during a global pandemic – and continuing to incentivise positive growth. Code principle Remuneration Experian plc Governance 120 Outlined below are some of the additional factors the Committee consider ed in setting speciﬁc FY21 annual bonus targets: Revenue performance (20%): As a growth company , revenue is a k ey indicator of business vitality and was added to our annual bonus plan in FY20. This additional metric added a quality of earnings aspect to the important focus of EBIT gr owth. The culture of Experian has a str ong performance-driven ethic and even in a contracting mark et we continued to focus on sustaining top-line growth, which was reﬂected in the performance target r ange for FY21. A maximum payout on the revenue element of the bonus would be earned f or 6% revenue performance and tar get was set at 3% revenue performance growth. Benchmark EBIT (80%) The key FY21 priorities were pr eserving employment, supporting employees and protecting in vestment in key str ategic and transf ormation areas that would enable us to emerge str onger from the pandemic and deliver continued futur e growth. We took a number of actions in FY21 to pr otect the business and support our employees, clients and other stakeholders thr ough the pandemic. These actions included discretionary spend r eductions, hiring and merit freeze and r eprioritisation of capital expenditur e and inorganic inv estments. The Committee fully supported the decision to prioritise employees and maintain str ategic investment in FY21. The Committee r ecognised this would inevitably restrict our ability to fully optimise EBIT and this was reﬂected in the agr eed targets. T arget was set at maintaining ﬂat full- year EBIT , over the course of the pandemic, increasing to maximum payout for 3% EBIT growth o ver the year . Given our commitment to gr owth, and our stance that no bonus should be paid for negative growth, the Committee agreed there was no thr eshold for FY21 EBIT . Annual bonus outcome Revenue performance is calculated as the Gr oup total revenue growth after the r emoval of intr a-Group sales, and Benchmark EBIT is based on ongoing activities. Perf ormance is measured on a constant curr ency basis to strip out the eects of exchange r ate ﬂuctuations, which ar e outside of management’s control. The Committee also exclude the impact of any material acquisitions or disposals made in the y ear , to ensur e both metrics are measured consistently , which is in line with our approach to long-term incentive plan measur es. Whilst the headline numbers of revenue performance and Benchmark EBIT gro wth for FY21 were 7% and 3% r espectively , the level of qualifying gr owth included for the purpose of calculating the annual bonus outturns was 5.8% and 2.7%, as shown in the table below . The table below shows our gr owth in Benchmark EBIT and rev enue performance for bonus purposes relative to the FY21 agr eed targets. Metric Weighting % growth requir ed for threshold payout % growth requir ed for target payout % growth requir ed for maximum payout FY21 actual growth Annual bonus achievement Benchmark EBIT growth 80% 0% 1.5% 3% 2.7% 144% Revenue performance gr owth 20% 0% 3% 6% 5.8% 39% T otal annual bonus achievement as % target 183% Before appr oving the annual bonus outcomes, the Committee discussed whether or not the proposed payout w as appropriate in the context of both the current external envir onment and the Group’s wider business performance during the year . The original performance range f or Benchmark EBIT growth was 0% – 3% between target and maximum payout. This performance range was set to be str etching at a time of great uncertainty r egarding the impact of the global COVID-19 pandemic recognising that, given the challenging environment for target setting, it may be appropriate to apply a degree of discretion to better r eﬂect a holistic view of performance over the year . As part of that holistic review of performance f ollowing the end of the year , it was agreed that the 0% – 3% performance par ameters for Benchmark EBIT growth was appr opriate for the challenging FY21 oper ating environment. However , r eﬂecting on the assumptions underlying the setting of the performance tar get range in the context of actual performance in the ﬁnancial y ear , it was agreed that it would be mor e appropriate to assess the outcome of this element against a 0% – 3% r ange from threshold to maximum (as shown in the table above), r ather than from target to maximum. This meant that Benchmark EBIT gr owth of 0% would result in 0% payout under this element, with growth of 1.5% r equired to earn a tar get payout (50% of maximum). This discr etionary adjustment to the eective performance r ange resulted in a reduction to the FY21 annual bonus outcome. As set out earlier in the Report, the Gr oup’s performance in the year was extremely resilient in the conte xt of the challenging external economic environment. The Committee agreed that the Company’s ﬁnancial performance was aligned with their holistic assessment of performance over the period, which included non-ﬁnancial factor s such as our Net Promoter Scor e, employ ee experience, employ ee engagement results, direct employee feedback to the Committee Chairman at the People F orum, and the broader shar eholder experience over the ﬁnancial year . The Committee was also satisﬁed that it did not need to exer cise any further discretion, and that the reduced level of bonus payout was appropriate f or the performance delivered. The resulting annual bonus outcomes for each executive dir ector (up to a maximum of 200% of contractual annual salary), for the year ended 31 March 2021 ar e set out in the table below . FY21 Bonus payout ‘000 Bonus payout % salary % bonus deferred under the CIP Brian Cassin £1,776 183% 100% Lloyd Pitchford £1,096 183% 100% Kerry Williams US$1,872 183% 100% While the executive director s waived an entitlement to 25% of their contractual salaries f or six months in FY21, their annual bonus entitlement was calculated – as is the case with all employ ees – based on their contractual annual salary entitlements, which are £972,500, £600,000 and US$1,025,000 respectively for Brian Cassin, Lloyd Pitchford and Kerry Williams. The bonus payout as a percentage of salary amounts abov e are based on these contractual salary entitlements, not the post-waiver salary amount the individual received in the year . Annual report on director s’ remuner ation contin ued Code principle Remuneration 121 Experian plc Annual Report 2021 Gover nance Each of the executive director s has elected to defer their full bonus into Experian shares under the CIP for a thr ee-year period. Deferr ed bonus shares are not subject to any further conditions but may be matched, subject to the conditions set out in the CIP awards section below . Share-based incentives The share-based incentive amount included in the single total ﬁgur e of remuner ation is the combined value of the CIP and PSP awards vesting in r espect of the relevant ﬁnancial y ear . F or FY21 these relate to the awards gr anted on 7 June 2018 and for FY20 they relate to the awards gr anted on 7 June 2017. Vesting in 2021 for both the CIP and PSP a wards is determined based on performance over the thr ee years ended 31 March 2021 as well as continued service. The Committee has not exercised an y discretion, or made any adjustments, in determining the vesting outcomes for the 2018 L TI a wards. The 2018 L TI targets wer e set in May 2018, when our gr owth ambitions were to achieve sustainable high single-digit growth. Our strong perf ormance in the ﬁrst two years of the performance period, combined with our resilient ﬁnancial perf ormance in FY21, wher e we continued to grow despite the challenges presented by the global pandemic, resulted in the formulaic vesting results outlined in the table below . The Committee reﬂected not just on the ﬁnancial performance delivered, but also on the experience of our investors and employees over the three- year performance period, and considered the formulaic results to be a fair and balanced outturn and, as such, did not make any adjustments to the vesting r esults. The tables below show the performance achieved against the targets f or the CIP and PSP awards gr anted in June 2018: CIP awards Performance measure Weighting V esting 1 Actual Percentage vesting 2 No match 1:2 match 1:1 match 2:1 match Benchmark PBT per share (annual gr owth) 50% Below 5% 5% 6% 9% 7.4% 73% Cumulative Benchmark operating c ash ﬂow 3 50% Below US$3.7bn US$3.7bn US$3.8bn US$4.1bn US$4.2bn 100% T otal 87% PSP awards Performance measure Weighting V esting 1 Actual Percentage vesting 4 0% 25% 50% 100% Benchmark PBT per share (annual gr owth) 75% Below 5% 5% 6% 9% 7.4% 73% TSR of Experian vs TSR of FTSE 100 Index 25% Below Index Equal to Index 8.3% above Index 25% above Index 65% above Index 100% T otal 80% 1 Straight-line vesting between the points shown. 2 The maximum opportunity, which requires 100% vesting, results in a two-f or-one match on the bonus deferred. 3 In line with the approach taken in previous years, the cumulative Benchmark operating c ash ﬂow targets shown above have been adjusted compar ed to those originally set to take into account the impact of acquisitions and disposals made over the performance period. The actual cumulative Benchmark operating cash ﬂow ov er the performance period, of US$4.2bn, is determined on a constant currency basis. This is in line with our approach for all performance metrics, to ensure that awar ds are measured on a consistent basis. 4 The maximum opportunity was the original award with a face value of 200% of salary . V esting of these awards was also subject to the Committee agreeing that the return on capital emplo yed (ROCE) performance over the period was satisfactory . FY21 ROCE was 15%, and so the Committee was comfortable that the payout determined by applying the performance criteria was appr opriate in the context of this level of performance. No discretion was applied in determining the shar e-based payments that vested in FY21. These awards had not vested at the date this r eport was ﬁnalised, and so the reported value of the a wards has been based on the aver age share price in the last three months of the ﬁnancial year , which was £25.58. The value of the awar ds included in the single total ﬁgure of r emuneration is as follows: CIP PSP V alue of shares vesting ‘000 V alue of dividend equivalent payments ‘000 T otal value of shares vesting and dividend payments ‘000 Shares awarded Shares vesting Shares awarded Shares vesting Brian Cassin 111,130 96,294 100,699 80,534 £4,523 £192 £4,715 Lloyd Pitchford 68,488 59,344 62,173 49,722 £2,790 £118 £2,908 Kerry Williams 87,480 75,801 79,354 63,463 US$4,911 US$194 US$5,105 The value of Kerry Williams’ shares has been converted into US dollar s at a rate of £1:US$1.379, which is the average r ate during the last three months of FY21. Dividend equivalents of 139.25 US cents per share will be paid on v ested shares. These r epresent the v alue of the dividends that would have been paid to the owner of one share between the date of gr ant and the date of vesting. Code principle Remuneration Experian plc Governance 122 The chart below shows the make-up of the CEO’s FY21 single ﬁgur e value, including £4.7m relating to the L TI. Of the £4.7m L TI v alue disclosed for the CEO, 71% is the value at gr ant, 4% is the v alue of dividend equivalent payments and 25% is a result of shar e price growth between the grant date and the aver age price over the last three months of the ﬁnancial y ear – which grew by over 35%. The same proportions are true for the other ex ecutive directors. £80 £10 0 £12 0 £14 0 £16 0 £18 0 £200 E xper ian 3-ye ar TSR rel ative to F T SE 1 0 0 Index March 2 018 September 2 018 March 2 019 September 2 019 March 2020 September 2020 March 2021 Ex perian F TSE 100 Inde x 0% 20% 40% 60% 80% 10 0 % Bre akdown of F Y2 1 CEO Single Figu re % FY21 Fixed Annual bonus Long-term incentives (LTI) vesting LTI – share price and dividends 14% 24% 44% 18% Update to 2020 disclosure We originally c alculated the value of the shar e awards r ealised by our executive directors in 2020 using the aver age share price fr om 1 January 2020 to 31 March 2020, in line with the prescribed single ﬁgur e methodology . This has now been revised to r eﬂect the actual share price and exchange r ate on vesting, as fol lows: Three-month average share price to 31 March 2020 Estimated value of long-term incentive awards ‘000 Share price on vesting Actual value of long-term incentive awards ‘000 Brian Cassin £7,563 £8,101 Lloyd Pitchford £25.63 £4,663 £27.53 £4,995 Kerry Williams US$7,934 US$8,400 What share-based inc entive awards did we mak e in the year ? (audited) On 11 June 2020, awar ds were granted to the executive dir ectors under the CIP and PSP . The face v alue of awards made to Brian Cassin and Lloy d Pitchford is shown in pounds sterling; the face v alue of awards made to K erry Williams is shown in US dollars. The number of shares awar ded to Kerry Williams was calculated using the aver age exchange rate for the three day s prior to grant of £1:US$1.27. All awards have been calculated using a three-day aver age share price. In line with the CIP rules, in vested shares for Brian Cassin and Lloy d Pitchford wer e purchased with their bonuses net of tax. In line with the rules of The Experian North America Co-investment Plan, invested shares for Kerry Williams wer e calculated with reference to his gr oss bonus. Matching awards ar e based on the gross value of the bonus def erred. Details of these awards ar e set out in the following table: T ype of interest in shar es Basis of award F ace value ‘000 Number of shares V esting at threshold performance Vesting date Brian Cassin CIP invested shares Deferred shar es 100% of net bonus £821 30,202 n/a 11 June 2023 CIP matching shares 1 Nil-cost options 200% of value of gross bonus def erral £3,099 113,971 25% 11 June 2023 PSP 2 Conditional shares 200% of salary £1,945 70,335 25% 11 June 2023 Lloyd Pitchford CIP invested shares Deferred shar es 100% of net bonus £507 18,636 n/a 11 June 2023 CIP matching shares 1 Nil-cost options 200% of value of gross bonus def erral £1,912 70,325 25% 11 June 2023 PSP 2 Conditional shares 200% of salary £1,200 43,394 25% 11 June 2023 Kerry Williams CIP invested shares Deferred shar es 100% of gross bonus US$1,631 47,285 n/a 11 June 2023 CIP matching shares 1 Conditional shares 200% of value of gross bonus deferral US$3,262 94,570 25% 11 June 2023 PSP 2 Conditional shares 200% of salary US$2,050 58,426 25% 11 June 2023 1 The number of shares awarded to executive dir ectors under the CIP was based on the share price at which invested shar es were purchased in the mark et and the face value shown above is based on this. This price was £27.19. 2 The number of shares awarded to executive dir ectors under the PSP was based on the average shar e price for the three day s prior to grant, which was £27.65, and the face value shown above is based on this. 14% 24% 18% 44% Annual report on director s’ remuner ation contin ued Code principle Remuneration 123 Experian plc Annual Report 2021 Gover nance As disclosed in our 2020 Annual report on dir ectors' remuner ation, given the prev ailing uncertainty in May 2020, when L TI targets would ordinarily be ﬁnalised, r egarding the short - and longer-term impact of CO VID-19, the Committee determined it appr opriate to delay setting and disclosing 2020 L TI targets until later in the year . The chart below outlines the timeline and some of the factors the Committee considered when determining appropriate targets for the 2020 L TI plans. March 2020 At its March meeting the Committee ordinarily has a preliminary discussion about possible targets for the forthcoming year . However , as a result of the timing of the global pandemic these discussions were delayed in anticipation of increasing clarity emerging about the likely global economic impact of COVID-19. May 2020 The Committee discussed the emerging impact of COVID-19 on our operating en vironment in the context of a number of key factors including: The ambition to set str etching but attainable targets, that reﬂect the emer ging operating and economic realities, which would therefor e reduce the pr ospect of relying on discr etion at vest and therefor e providing clarity and transpar ency for investors. The population of our top talent (below Boar d level) that participate in the PSP/CIP plans with the same performance targets as the executive directors, and the need to attract, motivate and retain that talent in an increasingly competitive external market, particularly in North America. The Committee’s str ong prefer ence was to apply performance targets which r eﬂect both (i) the current economic r ealities and (ii) our desire to r apidly return to the level of gr owth achieved in recent years. The Committee decided that, having consider ed our investor experience and our resilient shar e price performance to grant L TI awards in June 2020 but subject to performance conditions that would be determined later in the year . At the time of the June 2020 grant the shar e price had returned to pr e-pandemic levels and the Committee was satisﬁed there would not be any windfall gains. September 2020 At an additional meeting held in September the Committee began its initial discussion on potential 2020 L TI targets taking into account: Anticipated half- year ﬁnancial performance, which pr ovided a realistic view of the early impact of COVID-19 on our operating envir onment; Br okers' earnings estimates, which reﬂected the gener al economic uncertainty at the time and which were ther efore across a wider r ange than normal; and Views on the longer -term economic outlook coloured by potential second waves of COVID-19 and by vaccine development. November 2020 The Committee met again in November when the emergence of a second wave was clear and at this time there wer e no emerging breakthr oughs on vaccinations or expectations for near-term resumption of normal economic environment. Based on the information available at that time and incorporating analy sts' expectations the Committee set stretching but attainable tar gets. The targets set r eﬂected the anticipated impact of COVID-19 on FY21 – while maintaining our unchanged ambitions for FY22 and FY23. T argets were disclosed via RNS announcement on 26 November 2020. Letters issued on 26 November to our top 20 shareholders, to provide additional context on the factors the Committee considered in setting the 2020 L TI targets. In determining 2020 L TI plan tar gets, the Committee sought to maintain our ongoing commitment to setting str etching targets while balancing this with the need to (i) take account of the realities of CO VID-19 for FY21, (ii) r eﬂect our ambition to return to high single-digit growth in FY22 and FY23, while also (iii) ensuring targets ar e motivational, particularly for critical talent below Boar d level who participate in the CIP and PSP . The Committee determined the best approach to balancing these needs was to set the EPS tar gets to reﬂect the impact of CO VID-19 in FY21 while challenging management to return to high single-digit gr owth in FY22 and FY23 and retain the existing str etching three-year targets f or all other metrics. W e consider this approach achieves the appr opriate balance of setting targets that ar e challenging but attainable, and our expectation is that this approach will enable the Committee to apply the Policy without the need to r ely on discretion for in-ﬂight awards, or to adjust the performance outcomes of this award going forw ard. PSP awards and CIP matching shar es granted in June 2020 will vest subject to the achievement of the following performance conditions: Performance measure Weighting V esting 1 0% 25% 50% 100% CIP matching shares Benchmark Earnings per share (aver age annual growth) 2 50% Below 3% 3% 4% 7% Cumulative Benchmark operating c ash ﬂow 50% Below US$3.7bn US$3.7bn US$3.8bn US$4.1bn PSP awards Benchmark Earnings per share (aver age annual growth) 2 50% Below 3% 3% 4% 7% TSR of Experian vs TSR of FTSE 100 Index 25% Below Index Equal to Index 8.3% above Index 25% above Index Return on capital employed (a verage ov er three years) 25% Below 14.5% 14.5% 15.4% 16% 1 Straight-line vesting between the points shown. 2 Measured on an ongoing activities and constant currency basis. The Committee retains the right to vary the lev el of vesting if it believes that the level of vesting determined by measuring performance is inconsistent with the Group’s underlying ﬁnancial and oper ational performance over the performance period. These awar ds will also only vest if the Committee is satisﬁed the vesting is not based on materially misstated ﬁnancial results. Code principle Remuneration Experian plc Governance 124 How is the CEO’s pay link ed to Experian’s performance? The chart below shows Experian’s annual TSR performance compar ed to the FTSE 100 Index over the last ten years. The FTSE 100 Inde x is the most appropriate index as it is widely used and understood, and Experian is a constituent of the index. The chart also includes the CEO’s single ﬁgur e value received in each of the year s, to demonstr ate the alignment between executive pay and shareholder experience. £0 £50 £10 0 £ 15 0 £200 £250 £300 £350 £40 0 £45 0 Value of £ 1 00 in vested in Ex perian and the FTS E 1 00 on 31 March 20 1 1 31 Mar ch 2 0 11 31 Mar ch 2 0 12 31 Mar ch 2 0 13 31 Mar ch 2 014 31 Mar ch 2 0 15 31 Mar ch 2 0 16 31 Mar ch 2 0 17 31 Mar ch 2 018 31 Mar ch 2 0 19 31 Mar ch 20 21 31 Mar ch 2020 Ex perian F TSE 100 Inde x The table below sets out our CEO’s pay for the last ten ﬁnancial years: 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 CEO total single ﬁgure of remuneration (‘000) 1 Don Robert US$23,206 US$22,974 US$16,290 US$620 — — — — — — Brian Cassin — — — £1,976 £3,678 £3,647 £6,387 £11,882 £10,836 £7,560 Annual bonus paid against maximum opportunity (%) Don Robert 100% 75% 50% — — — — — — — Brian Cassin — — — 38% 100% 89% 58% 85% 80% 91% L TIP vesting against maximum opportunity (%) 2 Don Robert 100% 100% 94% 69% — — — — — — Brian Cassin — — — 40% 33% 32% 95% 90% 90% 84% 1 Prior year numbers have been updated to reﬂect actual long-term incentive plan outcomes. 2 The maximum L TIP opportunity varies as the CIP opportunity is based upon the actual bonus earned. CEO pay r atio Experian is committed to good corporate gov ernance and transpar ency in the reporting of r emuneration for our executive director s and employees. W e have presented below the CEO pa y ratio for the y ear ended 31 March 2021, in line with the UK regulatory r equirements. The pay r atios have been calculated using Option A of the thr ee methodologies provided under the new r egulations, which we believ e is the most statistically accur ate approach. Y ear Method 25th percentile pay ratio Median pay ratio 75th percentile pay ratio 2020 Option A T otal pay and beneﬁts Salary 267:1 £38,630 £33,362 178:1 £57,803 £47,869 112:1 £91,736 £77,000 2021 Option A 185:1 124:1 81:1 T otal pay and beneﬁts £40,969 £61,115 £93,574 Salary £32,569 £49,983 £75,000 The CEO value used is the total single ﬁgure r emuneration data for FY21 of £7.6m, as outlined on page 118 of this R eport. F or UK employees, total pay and beneﬁts are based on actual earnings for the year to 31 Mar ch 2021. Annual incentive payments for employees have been c alculated using the Experian Group ﬁnancial performance outcome for FY21, rather than any regional or mark et business performance results, to ensure a like-for-lik e comparison across r emuneration structur es. Selected employee gr ades below senior management level are also eligible for annual aw ards of r estricted stock, r ather than the performance share awards pr ovided to senior management. Wher e applicable, the L TI v alue for employees has been calculated by applying the aver age share price for the thr ee months prior to 31 March 2021 to the number of r estricted stock awards granted to the employ ee in June 2018. W e adopted this approach to pr ovide a like-for -like comparison and ensur e the share-price gr owth over the previous thr ee years is reﬂected Annual report on director s’ remuner ation contin ued Code principle Remuneration 125 Experian plc Annual Report 2021 Gover nance equally in both the CEO and employee L TI values. Employees on inbound and outbound international assignments to and fr om the UK have been excluded from the analy sis as their remuner ation structures understandably deviate from the standar d approach for UK employ ees. In line with the guidance, only individuals employ ed for the full year have been included in the analy sis. Observations on change in CEO pay r atio The FY21 CEO single ﬁgure has r educed by c.30% compared to FY20. By comparison the total pay and beneﬁts provided to UK employees in FY21 increased slightly over the pr evious year and as a result the FY21 CEO pay ratios for all per centiles are lower than for FY20. As mentioned previously , the CEO voluntarily waived 25% of his salary for six months in FY21, resulting in a signiﬁc antly lower salary for the CEO than the previous year . Conversely , the salary amounts received by employ ees in FY21 remained br oadly consistent with FY20 as we did not reduce an y employee salaries, make any COVID-19 r elated redundancies or furlough an y employees. In the interest of tr ansparency , and to provide a true comparison with FY20, if the CEO had not waived an y of his salary in FY21 the CEO pay ratio per centiles would have been 188:1, 126:1 and 82:1. The primary driver behind the lower FY21 CEO pay r atio is the value of the L TI r eceived by the CEO in FY21. While the value of L TI awards that vested in FY21 was very strong, particularly given the external operating environment during the ﬁnal y ear of the performance period, no adjustments were made to the vesting outturns to account for the impact of the global pandemic. Therefor e, the L TI value that the CEO r eceived in FY21 was considerably lower than in the previous year . By way of comparison, the total pay and beneﬁt amounts received by UK employ ees in FY21 is slightly higher than FY20 due to a combination of the US$700 Thank Y ou Shar e Awar d and the introduction of additional beneﬁt policies in FY21 as a r esponse to employee feedback gathered as part of the UK T otal R eward Optimisation pr oject. The Committee believe it is appropriate that a signiﬁc ant proportion of total r emuneration f or executive director s is ‘at risk’ and driven entirely by Gr oup performance, which is within their power to inﬂuence. In line with our remuneration principles the pr oportion of total compensation that is ‘at risk’ increases with employee seniority within the Gr oup. The remuner ation framework is designed to deliver market-competitiv e total compensation. All UK employees are also eligible to participate in the annual bonus plan, providing them with the opportunity to beneﬁt from the ﬁnancial performance that they help to deliver . Understandably more (71%) of the CEO’s total tar get remuneration is ‘at risk’ compar ed to c.8% on aver age for UK -based employees. As evidenced in FY21, the CEO pay r atio is therefore likely to v ary , potentially signiﬁc antly , over time based on the Gr oup’s performance outcomes. Observations on FY21 pay r atio The median pay ratio f or FY21 of 124:1 reﬂects not only the str ong resilient performance achieved in this pandemic y ear , but also the exceptional performance achieved in the preceding two ﬁnancial y ears, which ar e reﬂected in the CEO’s L TI vesting values. As L TI values can be highly variable, driven in part by ﬂuctuations in share price, a supplemental pay ratio has been provided below , where the value of L TIs has been excluded. The CEO single ﬁgure value e xcluding L TI compensation was £2.9m for FY21. Y ear Method 25th percentile pay ratio Median pay ratio 75th percentile pay ratio FY20 Option A excluding long-term incentives 71:1 47:1 30:1 FY21 Option A excluding long-term incentives 69:1 47:1 30:1 Some important additional context regar ding our FY21 CEO pay r atio includes: As mentioned in the Chairman's statement, we will be making a special one-o shar e recognition awar d to c.17,000 employees below senior management. Employ ees will be granted an initial shar e awar d of US$700, which will be matched on a 2:1 basis if employ ees continue to hold their shares for thr ee further years. While the US$700 shares will not be gr anted until August 2021, the commitment to pr ovide the award was communicated to all eligible employees in Mar ch 2021. As the award is a 'Thank Y ou' for the commitment and dedication shown throughout FY21 and is not forfeitable, the US$700 initial share awar d has been included in the above analysis. Experian has been a Living W age employer in the United Kingdom since 2015, and the median salary for UK employees (as r eﬂected in the table on the previous page) is mor e than 50% above the UK aver age. The Committee always has the context of the all-employ ee pay review budget when determining salary incr eases for the CEO and ensur es that any percentage incr ease for the CEO does not exceed that pr ovided to employees. In FY21, the CEO’s salary r educed as he voluntarily waived 25% of his contractual salary for six months of the y ear , while UK employees’ base salary br oadly remained the same as FY20. A global pay fr eeze was applied to all employees in FY21 but the aver age UK employee base pay did increase by 2.6% as a result of pr omotions etc. F or FY22, the UK salary review budget is 2.5%, while the CEO’s salary will incr ease by 2.3%. An ‘individual performance modiﬁer’ is applied in calculating the annual bonus payments for employees to ensure that the outstanding contributions of high-performing individuals is reﬂected thr ough higher bonus payments. T o ensure a lik e-for-lik e comparison with the CEO single ﬁgure, the employee calculations as outlined on the pr evious page do not reﬂect the impact of individual performance modiﬁer s as they do not apply to senior management, including the CEO , which would have consider ably increased the annual bonus payments for employees, as individual performance modiﬁers do not apply to senior management, including the CEO. We have also not included the v alue of our Sharesa ve scheme in the all-employee v alues on the previous page. W e ﬁrmly believe in the value of employee share owner ship and encourage emplo yees to participate in our Sharesav e oering, which is a tax -ecient plan in the UK and allows employees to share in Experian’s gr owth and success. Around 67% of UK employees participate in Shar esave and the average pr oﬁt received by UK employees at maturity in FY21 was £5,125, but this value which has not been included in the all-employ ee values on the previous page. Code principle Remuneration Experian plc Governance 126 How has our Boar d of director s' pay changed c ompared to the wider w orkforc e? The table below sets out the percentage change in the Boar d of director s' salary/fees, beneﬁts and annual bonus between FY20 and FY21, and how this compares to the aver age percentage change for our UK employees. While the Regulations r equire the employee comparison against employees of Experian plc, the pr oportion of our workfor ce employed by Experian plc is compar atively very small. We have therefor e elected to provide the comparison against our UK employees which we believe will pr ovide a more r epresentative analy sis. We have selected this group of employ ees because Experian operates in 44 countries and, as such, has widely varying approaches to pa y across dier ent regions. This approach also avoids the complexities involved in collating and comparing r emuneration data acr oss dierent geographic populations, including the impact of foreign ex change rate mov ements. The ﬁgures for UK employees ar e consistent with the information used to prepare the CEO pay r atio analysis, but reﬂect average salaries and aver age employee numbers each year , r ather than percentile data. F or the CEO, the annual bonus is based on Group performance. For UK employees, the annual bonus is based on the part of the business the individual works in. As outlined previously , the executive director s each waived 25% of their salaries for six months in FY21 and this is behind the year-on- year base salary change for Brian Cassin, Lloyd Pitchford and Kerry Williams. FY21 Y ear-on-year change in pay for director s compared to the aver age UK employee Executive directors Independent Chairman Non-executive directors Aver age employee Brian Cassin Lloyd Pitchford Kerry Williams Mike Rogers  Dr Ruba Borno Alison Brittain  Caroline Donahue Deirdr e Mahlan Luiz Fleury George Rose Base salary change 2.6% -12% -12% -12% 21% -11% n/a -14% -11% -11% 0% T axable beneﬁts 7.1% 1% 3% 3% n/a n/a n/a n/a n/a n/a n/a Annual bonus 27.5% 15% 15% 15% n/a n/a n/a n/a n/a n/a n/a 1 FY21 was Mike Rogers' ﬁrst full year as Chairman and the change to his base salary is a result of his r eceiving a full year's fees. 2 Alison Brittain joined the Board on 1 September 2020 and did not receive any fees in FY20. How do we intend to implement the r emuneration policy next year? Salary The table below outlines the salary increases that will tak e eect from 1 June 2021 for each Executive Dir ector . The global employee salary r eview budget for FY22 is 3.2%, and f or our employees in the UK and the USA the FY22 salary r eview budget will be 2.5%. 1 June 2021 ‘000 1 June 2020 ‘000 % increase Brian Cassin £995 £973 2.3% Lloyd Pitchford £615 £600 2.5% Kerry Williams US$1,050 US$1,025 2.4% Annual bonus F or the year ending 31 March 2022, the measures the executive directors ar e assessed on will remain unchanged from FY21. In line with our policy , we will disclose the tar gets for the annual bonus in next year’s Annual report on dir ectors’ remuner ation. While the FY22 annual bonus targets c annot be disclosed due to their commercial sensitivity they r eﬂect our conﬁdence in the outlook for the year ahead. Annual bonus will be subject to clawback provisions, allowing the Group to recover all or part of an y payment for a period of three year s from payment. In addition, the Committee can vary the level of pay out if it considers that the formulaic payout determined by measuring performance is inconsistent with the Gr oup’s actual underlying ﬁnancial and operational perf ormance. Performance is measured on a constant curr ency basis to strip out the eects of exchange rate ﬂuctuations, which ar e outside of management’s control. The Committee also excludes the impact of any material acquisitions or disposals made in the year to ensur e both metrics are measur ed consistently , which is in line with our approach to long-term incentive plan measur es. Share-based incentives While deferral of 50% is compulsory , the executive dir ectors have each elected to defer the full 100% of their FY21 bonuses into the CIP . W e expect to grant matching shar es in the ﬁrst quarter of the year ending 31 March 2022, on a two-f or-one basis. W e also expect to grant PSP awards equiv alent to 200% of salary at the same time. The CIP and PSP awards will vest subject to meeting the f ollowing targets, which will be measured over three years, with a further two-year holding period applying: Performance measure Weighting V esting 1 0% 25% 50% 100% CIP awards Benchmark Earnings per share (aver age annual growth) 2 50% Below 5% 5% 7% 10% Cumulative Benchmark operating c ash ﬂow 50% Below US$4.0bn US$4.0bn US$4.2bn US$4.4bn PSP awards Benchmark Earnings per share (aver age annual growth) 2 50% Below 5% 5% 7% 10% Return on capital employed 25% Below 14.5% 14.5% 15.4% 16% TSR of Experian vs TSR of FTSE 100 Index 25% Below Index Equal to Index 8.3% above Index 25% above Index 1 Straight-line vesting between the points shown. 2 Measured on an ongoing activities and constant currency basis. Annual report on director s’ remuner ation contin ued Code principle Remuneration 127 Experian plc Annual Report 2021 Gover nance The Committee selected adjusted Benchmark EPS, cumulative Benchmark oper ating cash ﬂow and ROCE as performance metrics for our long-term incentive plans, as they r eﬂect three of our key performance indicators. As such, using these measures dir ectly links Experian’s long-term incentive arrangements to our str ategic aims and business objectives. In addition, using r elative TSR recognises the importance of creating value f or shareholders. We believe these measur es to be the most appropriate measures of the Group’s success and, together with our annual bonus measures, they ensur e that executive director s are incentivised to deliver on a wide r ange of business and ﬁnancial measures over both the short and long term. The structur e dierentiates the r ole of each of our long-term incentive plans: the PSP incentivises returns and the CIP incentivises c ash discipline. Howev er , given that growth is so fundamental to our business str ategy , Benchmark EPS runs acr oss both of the long-term incentive plans. V esting of CIP and PSP awards will be subject to the Committee being satisﬁed that the vesting is not based on materially misstated ﬁnancial results. The Committee also retains the discr etion to vary the level of vesting if it considers that the level of vesting determined b y measuring performance is inconsistent with the Group’s underlying ﬁnancial and oper ational performance. These awar ds will all be subject to clawback provisions, allowing the Company to recov er all or part of any vested awar d during the holding period. TSR performance We measur e our TSR performance relative to the FTSE 100 Index, rather than against a bespok e comparator gr oup. Our usual comparator companies ar e Alliance Data Systems, CoreLogic, Dun & Bradstreet, Equifax, FICO, LiveRamp, Moody’s, RELX, Thomson Reuters and T ransUnion, however we believ e that it would be dicult to measure our TSR perf ormance against them on a consistent basis, since many of them ar e listed in dierent markets and, as such, may be subject to dierent market f orces. However , the Committee uses them as a refer ence point when reviewing other aspects of executiv e director pay . Additional disclosur es Directors’ shar eholdings and share interests (audited) We believe it is important that ex ecutive directors build up a signiﬁc ant holding in Experian shares, to align their interests with those of shareholders. Under our guidelines, the CEO should hold the equiv alent of three times his or her base salary in Experian shar es and other executive director s should hold the equivalent of two times their base salary . These guidelines include invested or deferr ed shares held under the CIP , but not matching shar es. Shar es that have vested but are subject to the two- year holding period will also count towar ds the guideline. Until the shar eholding guideline is met, we expect e xecutive directors to r etain at least 50% of any shares vesting (net of tax) under a share awar d. Unvested shares do not count tow ards the guideline. We also ha ve guidelines for non-executive director s to build up a holding in Experian’s shares equal to their annual fee. Each ﬁnancial year , the net fee for the ﬁrst quarter is used to purchase Experian shar es until the non-executive director reaches this holding. As set out in the table below , our executive dir ectors already signiﬁc antly exceed their personal shar eholding guidelines, demonstr ating their personal alignment to shareholder inter ests as well as their commitment to Experian. T o further strengthen this alignment post -employment, the R emuneration Committee introduced a two- year post-employment shar eholding guideline as part of the 2020 Policy r eview . All executive director s that served during the year hold shares in e xcess of the relevant shar eholding guidelines. The interests of the dir ectors (at 31 March 2021) and their connected persons in the Company’s or dinary shares (as at 31 Mar ch 2021) are shown below and, for those individuals in the table below , there have been no changes between 31 Mar ch 2021 and the date of this report: Shares held in Experian plc at 31 March 2021 Shareholding guidelines Share awar ds subject to performance conditions Share options 4 Guideline 1 (% of salary/fee) Shareholding (% of salary) 2 Guideline met? CIP matching awards 3 PSP awards Brian Cassin 5 526,185 300% 1,351% Ye s 359,717 252,154 — Lloyd Pitchford 5 278,947 200% 1,161% Ye s 221,906 155,615 1,470 Kerry Williams 6 146,930 200% 493% Ye s 293,860 205,118 — Mike Rogers 7 15,287 100% 96% No — — — Dr Ruba Borno 8 2,685 100% 50% No — — — Alison Brittain 9 5,250 100% 97% No — — — Caroline Donahue 10,000 100% 185% Ye s — — — Luiz Fleury 9,650 100% 179% Ye s — — — Deirdr e Mahlan 15,000 100% 214% Ye s — — — George Rose 20,000 100% 231% Ye s — — — 1 Executive director shareholding guideline will apply for two years post -employment. 2 Shareholding guidelines have been calculated using the closing share price on 31 Mar ch 2021, which was £24.97 and exchange r ates at 31 March 2021 of £1:US$1.378 and £1:€1.1746. 3 Matching shares granted to Brian Cassin and Lloyd Pitchfor d are in the form of nil-cost options, which are unvested at 31 March 2021. Those gr anted to Kerry Williams are conditional share awar ds. 4 Share options granted under the all-employee Shar esave plan. 5 The number of Experian shares held by Brian Cassin and Lloyd Pitchford at 31 Mar ch 2021 includes 95,326 and 58,804 invested shares in the CIP r espectively . 6 The number of Experian shares held by Kerry Williams at 31 March 2021 includes 146,930 shar es awarded to him under The Experian North America Co-investment Plan as a result of his annual bonus deferr al elections, in addition to his personal beneﬁcial shar eholding. Kerry Williams has an unconditional right to receive these Experian shares at the end of the r elevant three- year deferral period. These shares do not carry dividend or voting rights prior to receipt. 7 Mike Rogers was appointed Chairman on 24 July 2019 and is continuing to build his shareholding. 8 Dr Ruba Borno joined the Board in 2018 and is still building up her shareholding. 9 Alison Brittain joined the Board on 1 September 2020 and is still building up her shareholding. Payments made to former dir ectors (audited) F our former directors of Experian Finance plc (f ormerly GUS plc) received unfunded pensions fr om the Group. T wo of the former director s are now paid under the Secured Unfunded Retir ement Beneﬁt Scheme, which provides security for the unfunded pensions of executives aected b y the Her Majesty’s Code principle Remuneration Experian plc Governance 128 Revenue & Customs (HMRC) earnings cap. The total unfunded pensions paid to the former directors was £833,581 in the year ended 31 Mar ch 2021. Payments for loss of oce (audited) No payments for loss of oce were made in the y ear (2020: nil). Relative importance of spend on pa y The table below illustrates the r elative importance of spend on pay for all employees, compar ed to the ﬁnancial distributions to shareholders, through dividends and earnings-enhancing share r epurchases: 2021 US$m 2020 US$m % change Employee remuner ation costs 1,995 1,872 6.6% Dividends paid on ordinary shar es 427 424 0.5% Estimated value of earnings-enhancing share r epurchases — 16 -100% The Remuner ation Committee All our non-executive director s are members of the Committee, which met six times during the year ended 31 March 2021. Each member is consider ed to be independent in accordance with the UK Corpor ate Governance Code. The Committee’s terms of refer ence can be found at www .experianplc.com/about-us/corpor ate-governance/board-committees/. The Committee’s role and responsibilities The Committee is responsible for: 1 Recommending to the Board senior executive remuner ation policy and the Chairman’s remuner ation. 4 Making recommendations to the Board on the design of the Group’s short - and long-term incentive plans. 5 Overseeing the Group’s executive pension arrangements. 2 Determining individual remuner ation packages for executive director s and certain senior executives. 3 Communicating with shareholders on remuner ation policy . 6 Overseeing broader employee workforce policies. Committee activities During the year , the Committee: Reviewed and approved the 2020 R eport on directors’ r emuneration, and r eviewed a dr aft of the 2021 Report on director s’ remuner ation. Finalised the Remuneration P olicy , which was put to shar eholder vote at the 2020 AGM. Has continuously monitored the impact of COVID-19 on our business, and remuneration decisions taken acr oss the Group, such as the decision to apply global pay freezes. Reviewed salaries of certain Group Oper ating Committee members and approved annual pay freezes f or all Group Oper ating Committee members in FY21. Agreed the FY20 incentive plan outcomes, the FY21 bonus targets, and the long-term incentive plan participants. Received updates on the Company’s long-term incentive plans, including the impact of COVID-19 on these in-ﬂight awar ds. Held an additional meeting in September 2020 to consider the impact of COVID-19 on our operating en vironment, its impact on our in-ﬂight long-term incentive plan awards and to discuss perf ormance targets for the 2020 long-term incentive awar ds. Discussed at length executive pay in the context of the wider workfor ce and the broader impact on society , the Gr oup, and our shareholders. Was updated on all -employee pay and workfor ce policies across Experian. Following this update the Committee r equested, and was pr ovided with, detailed additional insights on all-employee pay , workforce policies and gender pay gap analy sis in North America and Br azil, two of our key regions. Was updated on curr ent trends in the executive remuner ation envir onment, focusing on our k ey regions. Was updated on the Compan y’s FY21 gender pay gap disclosure r equirement. The Committee had a robust discussion regar ding the results and was provided with additional detailed analy sis on Experian’s gender pay position. Was updated on the Compan y’s response to the UK CEO pay r atio disclosure requirement and r eviewed the relevant disclosures. Initiated the invitation to employees to participate in the 2020 Shar esave plan, and was updated on take-up and outcomes of previous gr ants. Considered r emuneration matter s in respect of senior hir es and departures and, where appropriate, approved r emuner ation packages for senior new hire awar ds below Board level. Reviewed the Committee’s performance during the year against its terms of r eference; and Received feedback from the Chairman on the k ey topics discussed at the UK&I Experian People F orum. The Chairman of the Committee attended the F orum which was held virtually in March 2021, to engage with employees, discuss how Experian’s executive r emuneration aligns with the wider Group pay policy , and understand employees’ views on pay -related issues. Annual report on director s’ remuner ation contin ued Code principle Remuneration 129 Experian plc Annual Report 2021 Gover nance Advice provided to the Committee In making its decisions, the Committee consults the Chairman, the Chief Executive Ocer and the Group Chief People Ocer where r equired. We also in vite members of the Global Rewar d team to attend Committee meetings as appropriate. W e normally consult the Chief Financial Ocer about performance conditions applying to short- and long-term incentive arr angements to ensure they are appr opriately ﬁnancially stretching. However , we do not consider it appropriate that executives ar e present when their own remuner ation arrangements ar e being discussed. The Committee has access to independent consultants to ensure that it r eceives objective advice. W e reviewed our external adviser s in 2013 and appointed T owers W atson Ltd (Willis T owers W atson), who r emained our external advisers throughout the year ended 31 March 2021. Willis T owers W atson provides other services to Experian globally , including advice on beneﬁts and provision of mark et data. Additionally , both Mer cer Kepler (from 1 April 2020 to 31 December 2020) and Ellason LLP (fr om 1 January 2021) provided incentive-plan award valuations and remuner ation data, as well as supporting data for the target c alibr ation process. Kepler does not pro vide any other services to the Group, although Mercer , Kepler’s parent company , does pr ovide unrelated services to the Group. Ellason does not provide an y other services to the Group. Willis T owers W atson, Mer cer Kepler and Ellason are members of the Remuner ation Consultants Group and voluntarily oper ate under the Code of Conduct in relation to executive r emuneration consulting in the UK. The Committee w as satisﬁed that their advice was objective and independent. The fees paid to these advisers for services to the Committee in the year ended 31 Mar ch 2021, based on hours spent, wer e as follows: Adviser Fees paid in the y ear Willis T owers Watson £44,900 Mercer Kepler £3,600 Ellason £9,750 What did we pay our non-ex ecutive directors during the y ear? (audited) The table below shows a single total ﬁgur e of remuner ation for the Chairman and non-executive dir ectors for the years ended 31 Mar ch 2021 and 31 March 2020: F ees ‘000 Beneﬁts ‘000 Share-based incentives ‘000 T otal ‘000 2021 2020 2021 2020 2021 2020 2021 2020 Mike Rogers 1 €465 €385 — — — — €465 €385 Dr Ruba Borno €158 €179 — — — — €158 €179 Alison Brittain (appointed 1 September 2020) €92 — — — — — £92 — Caroline Donahue €158 €185 — — — — €158 €185 Luiz Fleury 2 €210 €256 — — — — €210 €256 Deirdr e Mahlan €206 €231 — — — — €206 €231 George Rose €254 €254 — — — — €254 €254 1 Mike Rogers was appointed Chairman of the Board on 24 July 2019 and receiv es an annual fee for this role of €465,000. 2 Luiz Fleury acted as an independent adviser to Serasa S.A., our Brazilian business. His remuneration includes a fee for this role, paid in Brazilian r eais, along with the annual non-executive dir ector’s fee. Non-executive director fees ar e reviewed every two years and were last r eviewed in 2019. The current f ee levels are as follow s: Annual fee from 1 October 2019 Annual fee prior to 1 October 2019 Base fee €158,250 €150,750 Audit Committee Chairman fee €47,750 €45,500 Remuner ation Committee Chairman fee €38,250 €36,500 Deputy Chairman/Senior Independent Director fee €95,500 €91,000 Other than the Chairman, non-executiv e directors r equired to undertak e intercontinental tr avel to attend Board meetings receive a supplementary payment of €6,000 per trip, in addition to an y trav el expenses. This amount has not changed since October 2009. No such payments wer e made in FY21 due to COVID-19 tr avel restrictions. George Rose holds the r ole of Chairman of the Remuneration Committee, in addition to his r ole as Senior Independent Director . George R ose does not receive an additional fee for his r ole as Chairman of the Remuneration Committee. Code principle Remuneration Experian plc Governance 130 Statement of voting at the 2020 A GM The voting to approve the Annual r eport on directors' remuner ation and the Director s’ remuner ation policy at the AGM held on 22 July 2020 is set out in the following table: V otes for (including discretionary votes) % Number V otes against % Number T otal number of votes cast Number of votes withheld Annual report on dir ectors’ remuner ation 93.5% 6.5% 653,070,165 45,388,636 698,458,801 274,374 Directors’ r emuner ation policy 95.3% 4.7% 651,717,394 31,847,208 683,564,602 15,168,573 Service c ontracts Non-executive director s have letters of appointment that set out their duties and time commitment expected. They ar e appointed for an initial three- year term, subject to election and annual r e-election by shareholder s at the AGM. Appointments are r enewed by mutual agreement. Details of curr ent non-executive director arr angements as at 31 March 2021 are set out below: Name Date of appointment Length of service at 31 March 2021 Y ears Months Mike Rogers (appointed Chairman on 24 July 2019) 1 July 2017 3 9 Dr Ruba Borno 1 April 2018 3 0 Alison Brittain 1 September 2020 0 7 Caroline Donahue 1 January 2017 4 3 Luiz Fleury 8 September 2015 5 7 Deirdr e Mahlan 1 September 2012 8 7 George Rose 1 September 2012 8 7 Executive director s’ service contracts contain a 12-month notice period, as set out in the Directors’ remuner ation policy . Brian Cassin was appointed to the Board on 30 April 2012 as Chief Financial Ocer , and 16 July 2014 as Chief Executive Ocer . The date of appointment to the Board for Lloy d Pitchford was 1 October 2014 and for K erry Williams was 16 July 2014. Annual report on director s’ remuner ation contin ued Code principle Remuneration 131 Experian plc Annual Report 2021 Gover nance Directors’ r emuner ation policy The Directors’ r emuneration policy was last approved by shar eholders at the A GM on 22 July 2020. We ha ve included below the Policy table and the ‘Which clawback pr ovisions apply?’ section, which we consider to be the most helpful sections of the Policy for investors. The full and original version of the Policy , as appr oved by shareholder s, is a vailable on the Experian corpor ate website at www .experianplc.com/investors/reports. Element and link to strategy Operation Maximum potential value and payment at target Performance metrics and weightings Base salary T o help with attracting and retaining executive dir ectors of the right calibre. Provides a base level of pay and reﬂects the competitive market salary for the role. Base salary level takes account of personal contribution and performance against Groupstr ategy . Base salary is paid in equal instalments during the year . Salaries are r eviewed annually , with any incr eases generally taking eect fr om 1 June. Salary levels and increases take into account a number of factors, including the appr oach to employee remuner ation throughout the Group, prevailing economic conditions, best practice and positioning against the market. Annual executive director salary increases will, in normal circumstances, be limited to the increases awar ded across the Group as a whole. Higher increases may be made in exceptional circumstances including, but not limited to, a change in r ole or responsibility , and will tak e account of market pr actice in relation to the new role. When the Committee considers salary increases, it takes into account individual performance over the preceding ﬁnancial year . Beneﬁts Beneﬁts are pr ovided as part of a competitive and cost-eective over all remuner ation package. Certain beneﬁts may also be provided to support expatriates, wher e they have reloc ated. The Group pr ovides a range of mark et-competitive beneﬁts that include, but ar e not limited to, healthcare, ﬁnancial and tax advice, death-in-service provision and company c ar or allowance. Executive directors c an also participate in any of the Group’s all-emplo yee share plans, for example the Sharesave plan, on the same basis as other eligible employees. In the USA, eligible executive dir ectors may participate in a deferred compensation plan, which is standard market pr actice in the USA. For e xpatriate assignments, we r etain the ﬂexibility to tailor beneﬁts to the circumstances of the assignment. Additional beneﬁts may include reloc ation expenses at the beginning and end of each assignment, housing allowance and school fees. The cost of providing such beneﬁts may vary from y ear to year , reﬂecting the cost to the Gr oup. The Committee sets beneﬁts at a level it considers appropriate against relevant mark et practice, the role and particular circumstances (for example, in the c ase of expatriate beneﬁts, wher e the individual is requir ed to reloc ate). None. Pension Provides a market -aligned retir ement provision. Pension arrangements ar e in line with local market pr actice. In the UK, the Gr oup operates a deﬁned contribution plan, with company contributions set as a per centage of base salary . If impacted by HMRC pension limits, an individual may elect to receive a c ash allowance instead. In the USA, executive dir ectors are eligible to join a deﬁned contribution plan. In the UK, the c ash payment or pension contribution for current executive director s is normally equal to 20% of annual gross base salary . Futur e UK -based executive directors will receive a c ash payment or pension contribution aligned to the wider UK employee workforce (to apply to all incumbents by the end of 2022). In the USA, the contribution r ate is up to 4% of earnings, up to an annual compensation limit set by the Internal Revenue Service. If requir ed, pension arr angements in other jurisdictions would be in line with local market pr actice. None. Code principle Remuneration Experian plc Governance 132 Directors’ r emuneration policy contin ued Element and link to strategy Operation Maximum potential value and payment at target Performance metrics and weightings Annual bonus Motivates and rewar ds the achievement of speciﬁc annual objectives, link ed to Experian’s business strategy . The Committee sets appropriate performance tar gets at the start of each ﬁnancial year . At the end of the ﬁnancial year , the Committee determines the extent to which these have been satisﬁed, based on audited r esults, and agr ees the level of bonus to be paid. Half of any bonus must be deferred f or a period of three year s. However , the executive director may elect to defer up to 100% of their bonus into the CIP . Wher e they elect not to do so, payment is made as soon as practic able after the ﬁnancial year end. Malus and clawback provisions apply , under which annual bonus payments may be reduced or r ecovered in certain circumstances. Further details about our clawback and malus policy are set out in the Which clawback provisions apply? section of the r eport . Threshold performance r esults in a bonus payout equivalent to 25% of the maximum. No bonus is payable f or below-threshold performance. Achieving target performance r esults in a bonus payout equivalent to 50% of the maximum. Achieving maximum performance results in full bonus payout of 200% of salary . The annual bonus may be based entirely on ﬁnancial performance or on a combination of ﬁnancial, strategic and/or operational objectives. However , the ﬁnancial element will comprise at least 70% of the bonus. The Committee retains the ability to exercise its judgment to vary the level of payout if it considers that the formulaic payout determined by measuring performance is inconsistent with the Group’s actual underlying ﬁnancial and operational performance. Co-investment Plans Aligns with shareholder interests thr ough voluntary investment of personal capital, delivery of Experian shares and the long-term time horizons. Use of stretching ﬁnancial metrics incentivises performance. Encourages participants’ long-term commitment to the Group thr ough personal investment. Participants ar e invited to invest between 50% and 100% of their annual bonus into Experian shares. A conditional award of matching shar es or nil-cost options is granted on a two-for -one basis on the gross bonus deferred, and vests after three years subject to achieving performance targets over the thr ee-year period. Any v ested awards ar e subject to a further two- year holding period. Dividend equivalents accrue on all awar ds of shares. Malus and clawback provisions apply , under which CIP awards may be r educed or recov ered in certain circumstances. Further details about our cla wback and malus policy are set out in the Which clawback provisions apply? section of the r eport. Maximum award levels depend on the bonus deferred, which will be matched on up to a two-for-one basis. There is no vesting for below - threshold performance. Achieving threshold performance results in 25% vesting of the matching shares. Achieving target performance r esults in 50% vesting of the matching shares. Achieving maximum performance results in full vesting of the matching shares. Awar ds vest based on ﬁnancial performance and subject to the Committee being satisﬁed that the vesting is not based on materially misstated ﬁnancial results. The Committee retains the discretion to exer cise its judgment to vary the level of vesting if it considers the formulaic vesting level determined by measuring performance to be inconsistent with the Group’s actual underlying ﬁnancial and operational performance. Performance Share Plan Use of stretching ﬁnancial metrics incentivises performance. Aligns with shareholder interests thr ough delivery of shares and the long-term time horizons. Participants r eceive an annual award of conditional shares or nil-cost options, which vest after three years, subject to achieving performance targets over the three-y ear period. An y vested awards ar e subject to a further two-year holding period. Dividend equivalents accrue on all awar ds of shares. Malus and clawback provisions apply , under which PSP awards may be r educed or reco vered in certain circumstances. Further details about our cla wback and malus policy are set out in the Which clawback provisions apply? section of the r eport. Normal maximum award levels ar e 200% of salary . Awar ds of up to 400% of salary may be made in exceptional circumstances such as r ecruitment. There is no vesting for below - threshold performance. Achieving threshold performance results in 25% of the shar es vesting. Achieving maximum performance results in full vesting of the shar es. V esting of up to 25% of the awards is based on a share-based metric, with the balance based on ﬁnancial performance. The Committee retains the ability to vary the level of vesting if it considers the formulaic vesting level determined by measuring performance to be inconsistent with the Group’s actual underlying ﬁnancial and operational performance. Code principle Remuneration 133 Experian plc Annual Report 2021 Gover nance Element and link to strategy Operation Maximum potential value and payment at target Performance metrics and weightings Shareholding guideline T o preserve and enhance the long-term alignment of the interests of executive directors with shar eholders and promote a long-term approach to performance and risk management. During employment: Executive directors ar e required to establish and maintain a minimum personal shareholding equal to 3x base salary for the CEO and 2x base salary for other executive director s. Executive directors ar e required to retain at least 50% of any shares vesting under the CIP and PSP (net of tax) until their during-employment shareholding guideline has been met. Shares held beneﬁcially , shar es subject to a post-vesting holding period and in vested or deferred CIP shares will count when assessing the guideline. Share awar ds that are still subject to performance conditions and matching shares under the CIP ar e not included. Post-employment: For two y ears following cessation, (former) executive directors will be r equired to r etain the lower of: their actual shareholding immediately prior to cessation; and their shareholding guideline immediately prior to cessation. In determining the actual shareholding at cessation, shares acquir ed from own pur chases will not be counted. N/A N/A Independent Chairman and non-executive dir ector (NED) fees T o attract individuals with a broad r ange of experience and skills, to over see the implementation of our strategy . The Chairman is paid an annual fee in equal monthly instalments. The Group may pr ovide the Chairman with a limited range of beneﬁts such as healthc are, tax advice or use of a car . The NEDs are paid a basic fee plus additional fees for chairing a Board Committee and for the r ole of Deputy Chairman or Senior Independent Director . NED fees are paid in equal quarterly instalments during the y ear . The net fee for the ﬁrst quarter of the ﬁnancial year is used to purchase Experian shar es for NEDs and/or the Chairman (as applicable), until the individual has met their shareholding guideline of 1x their estimated annual fee (excluding tr avel fees). NEDs receive an additional fee wher e attendance at Board meetings involves inter continental travel from their home location. The Company may settle any tax due on trav el expenses incurred by the Chairman and NEDs. The Committee sets the Chairman’s fees, while NED fees ar e set by the Board. Both are set based on a number of factors, including the time commitment requir ed and positioning against the market. Fees ar e normally reviewed every two years. No performance-related arrangements ar e in place for the Chairman or the NEDs. Share Option Plan (SOP) Provides focus on incr easing Experian’s share price over the medium to longer term. Options are gr anted with an exercise price equiv alent to the market value of an Experian shar e at the date of grant. These vest subject to achieving performance targets that ar e tested over a three- year period and are exer cisable for seven years ther eafter . No option grants hav e been made since 2009 and the Committee has agreed that no further awar ds will be made, unless warr anted by exceptional circumstances such as recruitment. Malus and clawback provisions apply , under which SOP awards may be r educed or reco vered in certain circumstances. Further details about our cla wback and malus policy are set out in the Which clawback provisions apply? section of the r eport. Normal maximum award levels ar e 200% of salary . Grants of up to 400% of salary may be made in exceptional circumstances such as on recruitment. There is no vesting for below - threshold performance. Achieving threshold performance results in 25% of the options vesting. Achieving maximum performance results in full vesting of the options. The vesting of options is based on ﬁnancial performance targets. Code principle Remuneration Experian plc Governance 134 Which clawback pro visions apply? Clawback and/or malus applies to the Company’s incentive plans for ﬁve year s from gr ant . Under these provisions, the Committee may apply clawback or malus in circumstances which have: resulted in a level of vesting or payment which is higher than would otherwise hav e been, bec ause of a material misstatement of the Group’s ﬁnancial results; or led to a material ﬁnancial or reputational loss for the Gr oup, due to serious individual misconduct. Under our malus and clawback policy , should a trigger event be identiﬁed, a Clawback Committee would be appointed by the Remuner ation Committee to investigate the issue. The Clawback Committee would r eport back with recommendations on whether malus and/or clawback should be applied, which individuals this should aect, which r emuner ation should be subject to malus and/or clawback and the value that should be impacted. The Remuner ation Committee would then have ﬁnal sign-o on any decision to oper ate clawback or malus. Legacy arrangements The Committee reserves the right to make an y remuner ation payments and payments for loss of oce (including exercising any discr etions available to it in connection with such payments) notwithstanding that they are not in line with the policy set out in this r eport where the entitlement to the payment arose (i) befor e the 2020 AGM; (ii) at a time when the r elevant individual was not a dir ector of the Company and, in the opinion of the Committee, the payment was not in consideration f or the individual becoming a director of the Company; or (iii) under a r emuneration policy previously appr oved by the Company’s shareholder s. F or these purposes entitlements arising under the Company’s current remuner ation policy (as approved by shareholders at the 2017 AGM) will be incorpor ated into this policy and ‘payments’ includes the Committee satisfying awar ds of variable remuner ation, and an entitlement under an award ov er shares arises at the time the awar d is gr anted. On behalf of the Remuner ation Committee Charles Brown Company Secretary 18 May 2021 Directors’ r emuneration policy contin ued Code principle Remuneration 135 Experian plc Annual Report 2021 Gover nance Directors' r eport The directors pr esent their report and the audited ﬁnancial statements for the year ended 31 March 2021. The report has been prepar ed in line with the UK Companies Act 2006, and the Corpor ate governance report and the Shareholder and corpor ate information section form part of this Directors’ report. The Str ategic report contains certain inf ormation equivalent to that requir ed in a report of the dir ectors. Financial and operational inf ormation Results and dividend The Group income statement shows a pr oﬁt for the ﬁnancial year ended 31 March 2021 of US$802m (2020: US$677m). The dir ectors have announced the payment of a second interim dividend, in lieu of a ﬁnal dividend, of 32.5 US cents per or dinary share (2020: 32.5 US cents) to be paid on 23 July 2021 to shareholders on the r egister of members on 25 June 2021. A ﬁr st interim dividend of 14.5 US cents per ordinary shar e was paid on 5 F ebruary 2021, giving a total dividend for the y ear of 47.0 US cents per ordinary shar e (2020: 47.0 US cents). Innovation Innovation, supported by our talented people, and by resear ch and development, play s a key r ole in supporting Experian’s business performance. Details of such activities ar e given in the Strategic report. Acquisitions Information in respect of acquisitions made during the year is contained in note 41 to the Group ﬁnancial statements. Registered br anch The Company has a br anch register ed in Ireland under br anch number 905565. Post balance sheet events Details of events occurring after the end of the reporting period ar e contained in note 45 to the Group ﬁnancial statements. Share c apital Details of the Company’s share c apital and changes during the year ended 31 March 2021 ar e set out in note P to the Company ﬁnancial statements. Financial risk management, objectives and policies Descriptions of the use of ﬁnancial instruments and Experian’s treasury and risk management objectives and policies are set out in the Financial review within the Str ategic report and also in note 7 to the Group ﬁnancial statements. Politic al donations Experian did not make any political donations during the y ear ended 31 March 2021. Going concern Details of the adoption of the going concern basis in preparing the Gr oup ﬁnancial statements are set out in note 2 to the Gr oup ﬁnancial statements and are incorpor ated into this report by refer ence. Director s Information on directors holding oce in the y ear The directors’ names, biographical details, and skills and experience are shown in the Board of dir ectors section. Alison Brittain was appointed as an independent non-executive director on 1 September 2020 and Jonathan Howell was appointed as an independent non-executive dir ector with eect from 1 May 2021. Particulars of dir ectors’ remuneration, service contracts and interests in the Company’s ordinary shar es are shown in the Report on directors’ remuner ation. There wer e no changes in the director s’ (as at 31 March 2021) interests in the or dinary shares between the end of the ﬁnancial year and 18 May 2021. In line with the UK Corporate Gov ernance Code, as at the date of this report, all director s, being eligible, will oer themselves for election or re-election at the 2021 A GM. An ev aluation of the performance of the Board, its committees and individual director s was carried out during the ﬁnancial year . The Board is satisﬁed that all dir ectors seeking election or re-election contribute eectively and demonstr ate commitment to their roles. The Corpor ate governance report contains further details of the evaluation process. Insurance and thir d-party indemniﬁcation During the year and up to the date of approv al of this Annual Report, the Company maintained liability insur ance and third-party indemniﬁcation provisions for its dir ectors and ocers. Appointment and removal of director s Both the Company , by or dinary resolution, and the directors may elect any person to be a director . The number of directors shall not exceed the maximum number ﬁxed by the Company’s articles of association. Any person appointed by the director s shall only hold oce until the next AGM and shall then be eligible for election. The oce of a director shall be vacated on the occurr ence of any of the events listed in article 92 of the Company’s articles of association. The Company may , in accor dance with its articles of association, r emove any dir ector from oce and elect another person in their place. Experian plc Governance 136 Directors' r eport contin ued Annual General Meeting The Company’s 2021 AGM will be held in Dublin, Ireland, on Wednesday 21 July 2021. Shar eholders may submit questions beforehand via email to [email protected] or on the prepaid c ard sent to shareholders with the notice of meeting. The questions will be addressed at the meeting, via the Compan y’s website at www .experianplc.com or individually as appropriate. The notice of meeting has been circulated to shareholders and c an also be viewed on the Company’s website. Share c apital information Rights and obligations The rights and obligations attaching to the ordinary and deferr ed shares are set out in note P to the Company ﬁnancial statements and in the Company’s articles of association, a copy of which can be obtained from the Experian website, www .experianplc.com. The Company’s articles of association may be amended by passing a special resolution. ADR progr amme The Company has a Level 1 American Depositary Receipt (ADR) progr amme in the USA , for which The Bank of New Y ork Mellon acts as depositary . The ADRs ar e tr aded on the highest tier of the US over-the-counter mark et, O TCQX, with each ADR r epresenting one Experian plc ordinary shar e. F urther details are given in the Shareholder and corporate information section. Substantial shareholdings The Company’s articles of association oblige shareholder s to comply with the notiﬁcation obligations contained in the UK Disclosur e Guidance and T ransparency Rules sour cebook. As at 18 May 2021, the Company had been notiﬁed of the indirect inter est below in its issued ordinary shar e capital or voting rights in r espect of the year . Restrictions on tr ansfers of shares and/or v oting rights The Company is not awar e of any agreements between shar eholders that may result in r estrictions on the transf er of securities and/or voting rights and, apart fr om the matters described below , ther e are no r estrictions on the transfer of the Compan y’s ordinary shar es and/or voting rights: Certain restrictions on tr ansfers of shar es may from time to time be imposed by , for example, share dealing regulations. In certain situations, dir ectors and certain employees ar e required to seek the Company’s approv al to deal in its shares. Some of Experian’s share-based employee incentive plans include restrictions on the tr ansfer of shares, while the shar es are subject to the plan concerned. As described in the Report on director s’ remuner ation, non-executive directors must hold a pr oportion of their fees in shares, equal to their annual fee. These shares may not normally be tr ansferred during their period of oce. Where participants in a shar e-based employee incentive plan oper ated by Experian are the beneﬁcial owners of the shar es but not the register ed owner , the voting rights ar e normally exercised by the register ed owner at the direction of the participants. Shares carry no voting rights while the y are held in tr easury . The deferred shar es in the Company carry no voting rights. Unless the directors determine otherwise, members are not entitled to vote personally or by pr oxy at a shareholder s’ meeting, or to ex ercise any other member’s right in relation to shareholder s’ meetings, in respect of any shar e for which any call or other sum payable to the Company remains unpaid. Unless the directors determine otherwise, members are not entitled to vote personally or by pr oxy at a shareholder s’ meeting, or to ex ercise any other member’s right in relation to shareholder s’ meetings, if the member fails to provide the Company with the r equired information concerning interests in those shar es, within the pr escribed period after being served with a notice under the Company’s articles of association. The Company’s articles of association state that, ex cept for certain limited circumstances, if the number of shares in the Compan y beneﬁcially owned by residents of the US A exceeds a deﬁned permitted maximum and the directors give notice to the holder(s) of such shar es, the shares do not give their holder(s) the right to r eceive notice of , attend or vote at the Company’s gener al meetings. Details of deadlines in respect of voting for the 2021 A GM are contained in the notice of meeting that has been circulated to shar eholders and which can also be viewed at the Company’s website. Purchase, cancellation and holdings of own shar es The existing authority for the Company to pur chase its own shares was given at the AGM held on 22 July 2020. It permits the Company to purchase 90,830,113 of its own shar es in the market. On 8 June 2020, the Compan y transferr ed 944,435 ordinary shares from treasury to Computershar e Investor Services plc and Computershare T rustees (Jersey) Limited, the administr ator and trustee respectively of Experian’s share plans, for nil consider ation, to be used to meet obligations under employee share plans. On 29 June 2020, the Company transferr ed 7,202,137 ordinary shares from tr easury as consideration for a majority stake in a German credit bur eau, the Risk Management division of Arvato Financial Solutions (AFS). As at the date of approv al of this Annual Report, the Compan y holds 52,278,013 (2020: 60,424,585) of its own shares as tr easury shares, and had an unexpired authority to pur chase up to 90,830,113 of its own shares. Details of the new authority being requested at the 2021 A GM are contained in the circular to shar eholders, which either accompanies this Annual Report and/or is available on the Compan y’s website at www . experianplc.com. Details of the shares in the Company pur chased by and held under The Experian plc Employee Share T rust and the Experian UK Approved All Employee Share Plan ar e set out in note Q to the Company ﬁnancial statements. Substantial shareholdings Date of notiﬁcation Shareholder Number of ordinary shares/ voting rights Percentage of issued share capital/voting rights 24 September 2020 Massachusetts Financial Services Company 45,727,422 4.99% 137 Experian plc Annual Report 2021 Gover nance Signiﬁcant agr eements – change of control The Group is party to a number of agr eements that take eect, alter , terminate, or hav e the potential to do so, upon a change of contr ol of the Company following a takeover bid. These agreements are as f ollows: The Group’s banking facilities contain pr ovisions which, in the event of a change of control, could result in their r enegotiation or withdrawal. The Group’s Eur onotes allow holders to requir e repayment of the notes, if a rating agency r e-rates the notes to below investment gr ade, following a change of control. All of Experian’s share-based employee incentive plans contain provisions r elating to a change of control. Outstanding awards and options would normally vest and become exercisable, subject to satisfaction of any performance conditions at that time. The Group is party to a limited number of oper ational arr angements which can be terminated or alter ed upon a change of control of the Company , but these ar e not considered to be individually signiﬁc ant to the Group’s business as a whole. In certain cases, it is considered that their disclosure would be seriously pr ejudicial to the Company . Employment information Employment of people with disabilities People with disabilities have equal opportunities when applying for vacancies. In addition to complying with legislative requirements, the Group has pr ocedures to ensur e that it treats disabled employ ees fairly and car efully manages their training and c areer development needs. The policies are consider ed to operate eectivel y . The Gr oup supports employees who become disabled during the course of their employment, by oering re-tr aining or re-deployment, to enable them to r emain with the Group whenever possible. Employee invol vement Experian is committed to employee involvement thr oughout the business. The Group is intent on motivating sta, keeping them informed on matters that concern them in the context of their employment, and in volving them through loc al consultative procedur es. Where there are r ecognition agreements with tr ade unions, the consultation process is established through national and loc al trade union r epresentatives and thr ough joint consultation committees. Employees are k ept well informed on matters of inter est and the ﬁnancial and economic factors aecting the Group’s performance. This is done through management channels, confer ences, meetings, publications and intranet sites. More detail on employee engagement, together with information on corporate r esponsibility , diver sity , succession planning and talent development, c an be found in the Our sustainable business strategy: En vironmental, Social and Governance section of the Str ategic report. Experian supports employee share owner ship by providing, whenever possible, employ ee share plan arr angements which are intended to align employees’ interests with those of shar eholders. Auditor information Relevant audit information As at 18 May 2021, so far as each dir ector is aware, ther e is no relev ant audit information, being inf ormation needed by the auditor in connection with preparing the audit r eport, of which the auditor is unaw are, and each director has taken all steps that he or she ought to ha ve taken as a director in or der to make himself or herself awar e of any relevant audit information and to establish that the auditor is aware of that inf ormation. Independent auditor The auditor , KPMG LLP , has indic ated its willingness to continue in oce and a resolution that it be r e-appointed as the Company’s auditor will be proposed at the A GM. Statement of director s’ responsibilities The directors ar e responsible for: Preparing the Annual Report, the Group and Company ﬁnancial statements in accordance with applic able law and regulations. The directors ha ve decided to prepar e voluntarily a director s’ remuner ation report in accor dance with Schedule 8 to The Lar ge and Medium-sized Companies and Groups (Accounts and Reports) R egulations 2008 made under the UK Companies Act 2006, as if those r equirements applied to the Company . Preparing ﬁnancial statements which give a true and fair view of the state of aairs at the balance sheet date, and the proﬁt or loss for the period then ended of (a) the Group (in accor dance with IFRSs as adopted for use in the European Union), and (b) the Company (in accordance with UK Accounting Standar ds including FRS 101 ‘Reduced Disclosure F ramework’). Keeping sucient accounting recor ds which disclose, with r easonable accuracy , at any time the ﬁnancial position of the Group and the Company and enable them to ensure that the Gr oup ﬁnancial statements comply with applicable laws. Maintaining such internal control as they determine is necessary to enable the prepar ation of ﬁnancial statements that are free from material misstatement, whether due to fr aud or error , and have gener al responsibility for taking such steps as ar e reasonably open to them to safeguard the assets of the Gr oup and the Company and to pr event and detect fraud and other irr egularities. The maintenance and integrity of the statutory and audited information on the Company’s website. Jersey legislation and UK regulation governing the prepar ation and dissemination of ﬁnancial statements may dier from r equirements in other jurisdictions. In addition, the dir ectors consider that, in preparing the ﬁnancial statements: suitable accounting policies have been selected and applied consistently; judgments and estimates made have been reasonable, relevant and reliable; the Group ﬁnancial statements comply with IFRSs as adopted for use in the European Union, subject to any material departur es disclosed and explained in the ﬁnancial statements; Experian plc Governance 138 Directors' r eport contin ued the Group’s and Company’s ability to continue as a going concern has been assessed and, as applic able, matter s related to going concern have been disclosed; the Company ﬁnancial statements comply with UK Accounting Standards including FRS 101 ‘Reduced Disclosur e Framework’; and it is appropriate that the Gr oup and Company ﬁnancial statements have been prepar ed on the going concern basis, unless it is intended to liquidate the Company or any Gr oup company , or to cease oper ations or there is no r ealistic alternative to do so. The directors also conﬁrm that, to the best of their knowledge, the ﬁnancial statements are pr epared in accor dance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, ﬁnancial position and proﬁt of the Company and the undertakings included in the consolidation taken as a whole; and the Str ategic report contains a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face. In addition, each of the dir ectors considers that the Annual R eport and ﬁnancial statements, tak en as a whole, is fair , balanced and understandable and provides the inf ormation necessary for shareholders to assess the Group’s position and performance, business model and strategy . By order of the Boar d Charles Brown Company Secretary 18 May 2021 Corporate headquarters: Newenham House Northern Cross Malahide Road Dublin 17 D17 A Y61 Ireland Registered oce: 22 Grenville Str eet St Helier Jersey JE4 8PX Channel Islands Financial statements 1 40 Independ ent auditor’ s repor t Group ﬁnancial statements 1 47 Group in come s tateme nt 1 4 8 G roup st atemen t of comprehensi ve income 1 49 Group b alanc e sheet 1 50 Gro up state ment of chan ges in equi ty 1 51 Group c ash ﬂow s tateme nt Notes to the Group ﬁnancial statements 1 52 1 . Corp orate information 1 52 2. Basis of pr epar ation 1 52 3. Recent accounting developments 1 52 4. Signiﬁc ant accou nting po licies 1 59 5. C riti cal acco unting es timates , assumpti ons and judgment s 1 60 6. Us e of non -GA AP m easure s in the Group ﬁnancial statements 1 6 1 7 . Financial risk manage ment 1 63 8. Revenue 1 6 4 9 . Se gment info rmatio n 1 69 1 0. Forei gn curr ency 1 69 1 1 . L abour co sts an d employ ee numbers – continui ng operations 1 70 1 2. Amor tisation and depreciation charge s 1 70 1 3. Fee s payab le to the Co mpany’s audito r 1 71 1 4. E xceptio nal items an d other adjus tments made to der ive B enchmar k PBT – continuing operations 1 72 1 5. Ne t ﬁnance cos ts 1 73 1 6. T a x char ge 1 7 4 1 7 . Discontinued oper ations 1 75 1 8. Ear nings per share disclosures 17 5 19. D i v i d e n d s 1 7 6 20. Go odw ill 1 77 21 . Oth er intan gible as sets 1 78 22. Prop er ty, plant an d equipm ent 1 79 23. Invest ments in a sso ciates 1 79 24. T rad e and othe r recei vable s 1 80 25. Cash a nd cash e quival ents - excluding bank overdraf ts 1 81 26. T rad e and othe r payabl es 1 81 27 . Bo rrow ings 1 82 28. Net deb t (non- GA A P measur e) 1 8 4 29 . L ease s 1 85 30. Financial a sset s and liab ilitie s 1 90 3 1 . F air valu e metho dolog y 1 90 32. Con trac tual undis counte d futur e cash ﬂ ows for ﬁ nancial liabi lities 1 91 33. Share ince ntive pl ans 1 93 34. Post- empl oyment b eneﬁ t plans and relate d risks 1 94 35. Post- empl oyment b eneﬁ ts – IA S 1 9 inf ormati on 1 97 36. Defer red a nd curr ent tax 1 99 37 . Provis ions 1 99 38. Cal led- up share c apita l and share premium ac count 1 99 39 . Retain ed earnings and other reser ves 200 4 0. No tes to the G roup cas h ﬂow statement 202 4 1 . Acquisitions 203 42. Capital commitme nts 204 43. C onting encie s 204 44. Related par ty transac tions 205 4 5. Even ts occ urri ng af ter the end of the r epor ting p erio d Company ﬁnancial statements 206 C ompany p roﬁt an d loss ac count 206 Co mpany st atement o f comprehensi ve income 206 C ompany b alance s heet 207 Co mpany st atement o f changes in equi ty 208 Note s to the Co mpany ﬁnancial statements 139 Experian plc Annual Report 2021 Financial statements Experian plc Financial statements 140 Independent auditor’s report T o the members of E xper ia n plc 1 Our opinion is unmodiﬁed We ha ve audited the Financial Statements of Experian plc (the Company or the Par ent Company) for the year ended 31 Mar ch 2021, which comprise the Group income statement, Group statement of comprehensive income, Group balance sheet, Group statement of changes in equity , Gr oup cash ﬂow statement, Company proﬁt and loss account, company statement of compr ehensive income, Company balance sheet, Company statement of changes in equity , and the related notes, including the accounting policies in note 4 to the Gr oup Financial Statements and note D to the Company Financial Statements. In our opinion: the Group Financial Statements give a true and fair view , in accor dance with the International Financial Reporting Standards (IFRS) as adopted by the European Union, of the state of the Group’s aairs as at 31 March 2021, and of its proﬁt f or the year then ended; the Par ent Company Financial Statements give a true and fair view , in accordance with UK accounting standar ds, including FRS 101 R educed Disclosure F ramework, of the state of the P arent Company’s aair s as at 31 March 2021 and of its pr oﬁt for the year then ended; and the ﬁnancial statements have been prepar ed in accordance with Companies (Jersey) Law 1991. Additional opinion in relation to IFRS as adopted by the International Accounting Standards Boar d (IASB) As explained in note 2 to the Group Financial Statements, the Group, in addition to applying IFRS as adopted by the European Union, has also applied IFRS as issued by the IASB. In our opinion, the Gr oup Financial Statements have been pr operly prepar ed in accordance with IFRS as issued by the IASB. Basis for opinion We conducted our audit in accor dance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law . Our responsibilities ar e described below . W e believe that the audit evidence we have obtained isasucient and appropriate basis for our opinion. Our audit opinion isconsistent with our report to the Audit Committee. We wer e ﬁrst appointed as auditor by the shareholders on 20 July 2016. The period of total uninterrupted engagement is for the ﬁve ﬁnancial years ended 31 Mar ch 2021. W e have fulﬁlled our ethical r esponsibilities under , and we r emain independent of the Group in accor dance with, UK ethical r equirements including the FRC Ethical Standar d as applied to listed public interest entities. No non-audit services prohibited by that standard wer e provided. Overview Materiality: US$48m (2020: US$47m) Group Financial Statements as a whole 4.5% (2020: 5.0%) of Group pr oﬁt before tax (continuing operations) Coverage 89% (2020: 89%) of Group revenue 93% (2020: 81%) of Group pr oﬁt before tax (continuing operations) 89% (2020: 89%) of Group total assets Key audit matters v s 2020 Uncertain tax positions Provisions for litigation and contingent liabilities Impairment of goodwill Recover ability of Par ent Company’s investment in and amounts due from subsidiaries 2 Ke y audit matters: our assessment of risk s of material misstatement Key audit matters ar e those matters that, in our pr ofessional judgment, were of most signiﬁcance in the audit of the Financial Statements and include the most signiﬁcant assessed risks of material misstatement (whether or not due to fr aud) identiﬁed by us, including those which had the greatest eect on: the over all audit strategy; the alloc ation of resour ces in the audit; and directing the eorts of the engagement team. We summarise below the ke y audit matters, in decreasing or der of audit signiﬁcance, in arriving at our audit opinion above, together with our key audit procedur es to address those matters and, as requir ed for public interest entities, our results from those procedur es. These matters wer e addressed, and our results ar e based on procedur es undertaken, in the context of , and solely for the purpose of , our audit of the Financial Statements as a whole, and in forming our opinion thereon, and consequently are incidental to that opinion, and we do not provide a separate opinion on these matter s. The risk Our response T ax – uncertain tax positions (US$350m; 2020: US$327m) Refer to the Audit Committee Report within the Corpor ate Governance Report and the GroupFinancial Statements notes4,5,16, 36 and 43(a). Dispute outcome Experian operates in a number of territories worldwide with complex local and international tax legislation. Signiﬁcant uncertainties arise over ongoing tax matters in the UK, the USA, Br azil and Colombia. T ax pro visioning for uncertain tax positions is judgmental and requir es estimates to be made inrelation to existing and potential tax matters. The eect of these matters is that, as part of our risk assessment, we determined that uncertain tax pr ovisions have a high degree of estimation uncertainty , with a potential range of r easonable outcomes greater than our materiality for the Financial Statements as a whole, and possibly man y times that amount. We performed the tests below r ather than seeking to rely on any of the Group's contr ols because the natur e of the balance is such that we would expect to obtain audit evidence primarily through the detailed pr ocedures described. Our audit procedures included: Our tax expertise: Using our own tax specialists to perform an assessment of the Group’s tax positions thr ough the inspection of correspondence with the r elevant tax authorities and critically assessed the advice that the Gr oup has received fr om external advisors. W e challenged the assumptions applied using our own expectations based on our knowledge of the Group and consider ed relev ant judgments passed by authorities; and Assessing transparency: Assessing the adequacy of the Group’s disclosur es in respect of uncertain tax positions. Our results We found the level of tax pr ovisioning and disclosures to be acceptable (2020 result: acceptable). 141 Experian plc Annual Report 2021 Financial statements 2 Ke y audit matters: our assessment of risk s of material misstatement continued The risk Our response Provisions for litigation andcontingent liabilities (US$10m; 2020: US$30m) Refer to the Audit Committee Report within the Corpor ate Governance Report and the GroupFinancial Statements notes5, 37 and 43. Dispute outcome The Group oper ates in an industry with continuously increasing levels of r egulation, including both the EU and UK General Data Pr otection Regulations, Consumer Finance Protection Bur eau in the USA and various feder al and state legislative developments in Brazil, which increase the potential for regulatory br eaches and penalties. High levels of consumer litigation continue in the USA and Brazil. The outcome of such litigation is uncertain and any position taken by the Group in volves signiﬁcant judgment and estimation. The eect of these matters is that, as part of our risk assessment, we determined that the litigation liability has a high degree of estimation uncertainty , with a potential r ange of reasonable outcomes gr eater than our materiality for the Financial Statements as a whole, and possibly man y times that amount. In conducting our ﬁnal audit pr ocedures, based on the status of ongoing matters at the year end date, we reassessed the degr ee of estimation uncertainty to be less signiﬁcant. The risk at that date was principally over the judgment of whether to recor d certain provisions and /or disclose contingent liabilities. We performed the tests below r ather than seeking to rely on any of the Group's contr ols because the natur e of the balance is such that we would expect to obtain audit evidence primarily through the detailed pr ocedures described. Our audit procedures included: Enquiry of lawyers: On all signiﬁcant legal c ases, wher e necessary , assessment of correspondence with the Gr oup’s external lawyers was performed to corr obor ate our understanding of these matters, accompanied by discussions with internal counsel, as well as challenging the Group’s assumptions on the likelihood and quantum of potential cash outﬂows; and Historical comparisons: Comparing the outcomes of historical legal cases to curr ent cases with similar fact patterns; and Assessing transparency: Assessing whether the Gr oup’s disclosures detailing signiﬁcant legal pr oceedings adequately disclose the potential liabilities of the Group. Our results We consider the pr ovisions for litigation r ecognised and contingent liability disclosures made to be acceptable (2020 result: acceptable). Goodwill impairment in respect of the EMEA and Asia Paciﬁc cash gener ating units (CGUs) Goodwill: (US$799; 2020: US$414m) Impairment: (US$53m; 2020: US$nil) Refer to the Audit Committee report within the Corpor ate Governance Report and the GroupFinancial Statements notes4, 5 and 20. F orecast -based valuation Follo wing the impairment recognised in the Asia P aciﬁc CGU, the audit risk has reduced compar ed to the prior year . The total carrying value of goodwill as at 31 Mar ch 2021 is US$5,261m. Of this, US$4,462m relates to CGUs where there is signiﬁcant headroom between the v alue-in-use and the carrying value of net assets. The remaining balance of US$799m relates to the EMEA and Asia P aciﬁc CGUs. The estimated recover able amount of the EMEA CGU shows relatively low headr oom and an impairment to goodwill of $53m in the Asia Paciﬁc CGU has been r ecognised in the year . The c arrying values of both CGUs ar e sensitive to changes in key assumptions, principally relating to short and long-term revenue gr owth, futur e proﬁtability and discount rates, which could have a material impact on the carrying value of the associated goodwill. The eect of these matters is that, as part of our risk assessment, we determined that the value in use of the EMEA and Asia Paciﬁc goodwill has a high degr ee of estimation uncertainty , with a potential r ange of reasonable outcomes greater than our materiality for the Financial Statements as a whole. The Financial Statements (note 20) disclose the sensitivity estimated by the Group. We performed the tests below r ather than seeking to rely on any of the Group's contr ols because the natur e of the balance is such that we would expect to obtain audit evidence primarily through the detailed pr ocedures described. Our audit procedures included: Assessing methodology: Ass ess ing whe ther th e prin ciple s and int egri ty o f the cas h ﬂow mo del is in ac corda nce wi th the relev ant accountin g standard s; Challenging growth assumptions: Chall enging the Gro up’ s assumptions and obtai ning support, such as board-approved str ate gy pla ns, as w ell as co rrob ora ting lon g term gr ow th rat es to ex tern al sour ces; Our sector experience: Critically asses si ng the app ropr iatene ss of th e disco unt rate a ppli ed thro ugh the u se of our valuations specialis ts; Sensitivit y analy sis: Per for ming b oth br eakeven a nd pla usible s cenar io sen sitiv it y analysi s on the key ass umptio ns note d abov e to ident if y sensi tivi ty t o potent ial impair ments; Historical comparisons: Evaluat ing the t rack r ecor d of historical assumptions used agai nst actual results achieved; and Ass essing transparency: A ssessing whet her the Group ’ s disc losure s abo ut the s ensit ivit y of th e outc ome of th e impair ment asse ssment to a rea sonably po ssible change in key as sumpti ons re ﬂec ted th e risk s inher ent in the va luation of goodwill. Our results As a result of our work, we found the carrying v alue of goodwill for the EMEA and Asia Paciﬁc CGUs to be acceptable (2020 result: acceptable). Experian plc Financial statements 142 Independent auditor’s report Co ntinued 2 Ke y audit matters: our assessment of risk s of material misstatement continued The risk Our response Recover ability of Parent Company’s investment in and amounts due from subsidiaries (Investment in subsidiaries – US$17,919.5m, (2020:US$17,413.2m) Amountsowed by subsidiary undertakings – US$1,759.5m, (2020:US$1,728.0m) Refer to the Par ent Company Financial Statements notes LandN. Low risk, high value The carrying amount of the Par ent Company’s investments in, and amounts due fr om, subsidiaries r epresents 91% (2020: 91%) and 9% (2020: 9%) of the Par ent Company’s total assets respectively . Their recover ability is not at a high risk of signiﬁcant misstatement or subject to signiﬁcant judgment. However , due to their materiality in the context of the Par ent Company Financial Statements, this is considered to be the area that had the gr eatest eect on our over all Par ent Company audit. We performed the tests below r ather than seeking to rely on any of the Group's contr ols because the natur e of the balance is such that we would expect to obtain audit evidence primarily through the detailed pr ocedures described. Our audit procedures included: T ests of detail: Comparing the carrying amount of 100% of investments and amounts due from subsidiaries, with the relevant subsidiaries’ dr aft balance sheet to identify whether their net assets, being an appr oximation of the minimum recover able amount of the related investments and amounts owed by subsidiary undertakings, wer e in excess of their carrying amount, and assessing whether those subsidiaries have historically been pr oﬁt-making; Our results We found the conclusion that ther e is no impairment of thecarrying amounts of the Par ent company’s investments inand amounts due from subsidiaries to be acceptable (2020:acceptable). 3 Our application of materiality and an ov erview of the scopeof our audit Materiality Materiality for the Group Financial Statements as a whole was set at US$48m (2020: US$47m), determined with r efer ence to a benchmark of consolidated Group pr oﬁt before tax on continuing oper ations, of which it repr esents 4.5% (2020: 5.0%). Materiality for the Par ent Company Financial Statements as a whole wasset at US$25m (2020: US$25m), determined with r eference to a benchmark of company total assets, of which it repr esents 0.1% (2020:0.1%). In line with our audit methodology , our pr ocedures on individual account balances and disclosures wer e performed to a lower threshold, performance materiality , so as to r educe to an acceptable level the risk that individually immaterial misstatements in individual account balances add up to a material amount across the Financial Statements as a whole. Performance materiality was set at 75% (2020: 75%) of materiality for the Financial Statements as a whole, which equates to US$36m (2020: US$35m) for the Group and US$19m (2020: US$19m) for the Par ent Company . W e applied this percentage in our determination of performance materiality because we did not identify any factor s indicating an elevated level of risk. We agr eed to report to the Audit Committee any corrected or uncorr ected identiﬁed misstatements exceeding US$2.4m (2020: US$2.3m), in addition to other identiﬁed misstatements that warranted r eporting on qualitative grounds. Our audit of the Group and P arent Company w as undertaken to the materiality level speciﬁed above, which has informed our identiﬁcation ofsigniﬁcant risks of material misstatement and the associated audit procedur es performed in those areas as detailed abov e. Scoping Of the Group’s 196 (2020: 189) r eporting components, we subjected three(2020: thr ee) to full scope audits for Group purposes, performed bycomponent auditors (KPMG member ﬁrms). Additionally , two r eporting components were audited by the Gr oup audit team, one of which w as the Par ent Company . The three r eporting components and work performed by the Group audit team accounted for the percentages illustr ated opposite. The remaining 11% (2020:11%) of total Gr oup revenue, 7% (2020:19%) oftotal proﬁts and losses that make up Gr oup proﬁt before tax (continuing operations) and 11% (2020:11%) of total Gr oup assets is represented by 191 (2020:184 ) reporting components, none of which individually repr esented more than 2% (2020:3% ) of any of total Gr oup revenue, Group pr oﬁt before tax (continuing oper ations) or total Group assets. F or these residual components, we performed analysis at an aggr egated Group level to r e-examine our assessment that there wer e no signiﬁcant risks of material misstatement within these. The Group audit team instructed component auditors as to the signiﬁc ant areas to be cover ed, including the relevant risk s detailed above and the information to be reported back. The Group audit team appr oved the component materialities, which ranged fr om US$9m to US$36m (2020: US$12m to US$42m) having regar d to the mix of size and risk proﬁle of the Gr oup across the components. The Group oper ates ﬁve shared service centres in the UK, the USA, Malaysia, Costa Rica and Bulgaria, the outputs of which are included in theﬁnancial information of the reporting components they service and therefor e they are not separ ate reporting components. Each of the servicecentres is subject to speciﬁed risk -focused audit procedures, predominantly the testing of tr ansaction processing and review controls. Additional procedur es are performed at certain r eporting components to address the audit risk s not covered by the work performed o ver the shared service centr es. Site visits to the USA, UK and Br azil components by the Group audit teamwere unable to take place as a r esult of the COVID-19 pandemic. T elephone and video conference meetings wer e held with these component audit teams. At these meetings, the ﬁndings reported to theGroup audit team wer e discussed in more detail, and any further workrequir ed by the Group audit team was then performed b y the component auditors. 143 Experian plc Annual Report 2021 Financial statements Gr oup pro ﬁt befo re tax (continuing operations) US$1 ,077m (2020: US$942m) Group revenue T ota l pro ﬁts an d los ses tha t make up Gro up pro ﬁt befo re tax (continuing operations) Group m ateriality US$ 48m (20 20: US$47m) US$48m Wh ole Fin anci al State men ts mate ria lit y (2020: US$4 7m ) Pr oﬁt be for e ta x (continuing operations) Group m ateriality US$2.4 m Mis st atem ent s repo r ted to the Au dit Com mit te e (202 0: US$2. 3m) US$36m Ran ge of mate rial it y at thr ee rep or tin g co mpo nent s US$9m to US$3 6m (20 20: US$1 2m to US$42m ) Ful l sc ope fo r Gro up audi t purp os es 2021 Ful l sc ope fo r Gro up audi t purp os es 2020 Residual components 89% (2020: 89%) 89 89 11 11 Gr oup tota l ass ets 89% (2020: 89%) 89 89 11 11 93% (2020: 81 %) 93 81 19 7 3 Our application of materiality and an ov erview of the sc ope of our audit continued 4 Going conc ern The Directors ha ve prepar ed the Financial Statements on the going concern basis as they do not intend to liquidate the Group or the Company or to cease their operations, and as they have concluded that the Group’s and the Company’s ﬁnancial position means that this is realistic. They have also concluded that there ar e no material uncertainties that could have cast signiﬁc ant doubt over their ability to continue as a going concern for at least a year from the date of appr oval of the Financial Statements (the going concern period). We used our knowledge of the Gr oup, its industry , and the gener al economic environment to identify the inher ent risks to its business model and analysed how those risks might aect the Gr oup’s and Company’s ﬁnancial resour ces or ability to continue operations o ver the going concern period. The risk that we considered most lik ely to adversely aect the Group’s and Company’s a vailable ﬁnancial resour ces and metrics relevant to debt co venants over this period is the loss or inappropriate use of data or systems, leading to serious reputational and br and damage, legal penalties and class action litigation. We consider ed whether these risks could plausibly aect the liquidity or covenant compliance in the going concern period by assessing the degree of downside assumption that, individually and collectivel y , could result in a liquidity issue, taking into account the Gr oup’s current and pr ojected cash and facilities (a reverse str ess test). W e also assessed the completeness of the going concern disclosure. Our conclusions based on this work: we consider that the Directors’ use of the going concern basis of accounting in the prepar ation of the Financial Statements is appropriate; we have not identiﬁed, and concur with the Directors’ assessment that there is not, a material uncertainty related to events or conditions that, individually or collectively , may c ast signiﬁcant doubt on the Gr oup’s or Company's ability to continue as a going concern for the going concern period; and we have nothing material to add or dr aw attention to in relation to the Directors’ statement in note 2 to the Financial Statements on the use of the going concern basis of accounting with no material uncertainties that may cast signiﬁcant doubt o ver the Group and Company’s use of that basis for the going concern period, and we f ound the going concern disclosure in note 2 to be acceptable. However , as we c annot predict all futur e events or conditions and as subsequent events may result in outcomes that ar e inconsistent with judgments that were r easonable at the time they were made, the above conclusions are not a guar antee that the Group or the Company will continue in operation. Experian plc Financial statements 144 Independent auditor’s report Co ntinued 5 Fr aud and breaches of laws and r egulations – ability todetect Identifying and responding to risks of material misstatement due to fraud T o identify risks of material misstatement due to fr aud (fraud risk s) we assessed events or conditions that could indicate an incentive or pr essure to commit fraud or pr ovide an opportunity to commit fraud. Our risk assessment procedur es included: Enquiring of Directors, the Audit Committee, Internal Audit and inspection of policy documentation as to the Group’s high-level policies and procedur es to prevent and detect fr aud, including the internal audit function, and the Gr oup’s channel for “whistleblowing” , as well as whether they have knowledge of any actual, suspected or alleged fr aud. Reading Board, Audit Committee, Remuner ation Committee, Nomination and Corporate Gov ernance Committee minutes. Considering remuner ation incentive schemes and performance tar gets for management and Directors including the tar gets for management remuner ation linked to the Co-investment Plans and Performance Share Plan shar e incentive plans. Using analytical pr ocedures to identify any unusual or unexpected relationships. We communic ated identiﬁed fraud risk s throughout the audit team and remained alert to any indic ations of fraud thr oughout the audit. This included communication fr om the Group audit team to full scope component audit teams of relevant fr aud risks identiﬁed at the Group level and request to full scope component audit teams to r eport to the Group audit team any instances of fr aud that could give rise to a material misstatement in the Group Financial statements. As requir ed by auditing standards, we perform procedures to addr ess the risk of management override of controls and the risk of fr audulent revenue r ecognition, in particular non-tr ansactional revenue recor ded in the wrong period, and the risk that Group and component management may make inappropriate accounting entries. We did not identify an y additional fraud risk s. We also performed pr ocedures including: Identifying journal entries to test for all full scope components and central entities based on risk criteria and comparing the identiﬁed entries to supporting documentation. These included those posted with key descriptive wor ds and those posted to seldom used accounts. Assessing when non-transactional r evenue was r ecognised in all full scope components, particularly focusing on r evenue recognised in the days befor e the year end date, and whether it was recognised in the correct year . Identifying and responding to risks of material misstatement due to non-compliance with laws and regulations We identiﬁed ar eas of laws and regulations that could reasonably be expected to have a material eect on the Financial Statements from our general commer cial and sector experience, and through discussion with the Directors (as r equired by auditing standards), and from inspection of the Group’s r egulatory and legal correspondence and discussed with the Directors the policies and pr ocedures regarding compliance with la ws and regulations. As the Group is r egulated, our assessment of risk s involved gaining an understanding of the control en vironment including the entity’s procedur es for complying with regulatory r equirements. We communic ated identiﬁed laws and r egulations throughout our team and remained alert to any indic ations of non-compliance throughout the audit. This included communication from the Gr oup audit team to full-scope component audit teams of r elevant laws and r egulations identiﬁed at the Group level and a r equest for full scope component auditors to report to the Gr oup audit team any instances of non- compliance with laws and r egulations that could give rise to a material misstatement in the Group Financial Statements. The potential eect of these laws and r egulations on the Financial Statements varies consider ably . First, the Gr oup is subject to laws and regulations that directly aect the Financial Statements including ﬁnancial reporting legislation (including related companies legislation), distributable proﬁts legislation as set out by Companies (Jersey) Law 1991, taxation legislation and pension legislation and we assessed the extent of compliance with these laws andregulations as part of our pr ocedures on the r elated ﬁnancial statement items. Secondly , the Gr oup is subject to many other laws and r egulations where the consequences of non-compliance could have a material eect on amounts or disclosures in the Financial Statements, for instance thr ough the imposition of ﬁnes or litigation. W e identiﬁed the following areas as those most likely to have such an eect: data pr otection legislation, health and safety , anti-bribery , emplo yment law and certain aspects of company legislation recognising the ﬁnancial and r egulated nature of the Gr oup’s activities. Auditing standar ds limit the required audit procedur es to identify non-compliance with these laws and r egulations to enquiry of the Directors and other management and inspection of r egulatory and legal correspondence, if any . Therefor e, if a breach of oper ational regulations is not disclosed to us or evident from r elevant corr espondence, an audit will not detect that breach. Further detail in r espect of the provisions for litigations, contingent liabilities and uncertain tax positions is set out in the key audit matter disclosures in section 2 of this r eport. Context of the ability of the audit to detect fraud or br eaches of law or regulation Owing to the inherent limitations of an audit, there is an una voidable risk that we may not have detected some material misstatements in the Financial Statements, even though we ha ve properly planned and performed our audit in accordance with auditing standar ds. For e xample, the further removed non-compliance with law s and regulations is fr om the events and transactions r eﬂected in the Financial Statements, the less likely the inherentl y limited procedur es requir ed by auditing standards would identify it. In addition, as with an y audit, ther e remained a higher risk of non- detection of fraud, as these may involve collusion, for gery , intentional omissions, misr epresentations, or the override of internal controls. Our audit procedur es are designed to detect material misstatement. We ar e not responsible for pr eventing non-compliance or fr aud and cannot be expected to detect non-compliance with all laws and r egulations. 6 W e have nothing to r eport on the other information in the Annual Report The Directors ar e responsible for the other information presented in the Annual Report together with the Financial Statements. Our opinion on the Financial Statements does not cover the other information and, accordingly , we do not express an audit opinion or , except as explicitly stated below , any form of assur ance conclusion thereon. Our responsibility is to r ead the other information and, in doing so, consider whether , based on our Financial Statements audit work, the information therein is materially misstated or inconsistent with the Financial Statements or our audit knowledge. Based solely on that work we have not identiﬁed material misstatements in the other information. 145 Experian plc Annual Report 2021 Financial statements 6 W e have nothing to r eport on the other information in the Annual Report c ontinued Report on Director s’ Remuner ation In addition to our audit of the Financial Statements, the Dir ectors haveengaged us to audit the information in the Report on Dir ectors’ Remuner ation that is described as having been audited, which the Directors ha ve decided to prepar e as if the Company were r equired tocomply with the requir ements of Schedule 8 to The Lar ge and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (S.I. 2008 No. 410) made under the UK CompaniesAct2006. In our opinion, the part of the R eport on Directors’ R emuneration to beaudited has been properly pr epared in accor dance with the UK Companies Act 2006, as if it applied to the Compan y . Disclosures of emerging and principal risk s and longer-term viability We ar e required to perform procedur es to identify whether there is a material inconsistency between the Directors’ disclosur es in respect of emerging and principal risk s and the Viability Statement, and the Financial Statements and our audit knowledge. Based on those procedur es, we ha ve nothing material to add or dra w attention to in relation to: the Directors’ conﬁrmation within the Viability Statement on page 82 that they have carried out a r obust assessment of the emerging and principal risks facing the Gr oup, including those that would thr eaten its business model, futur e performance, solvency and liquidity; the Principal Risks disclosures describing these risk s and how emerging risk s are identiﬁed, and explaining how they ar e being managed and mitigated; and the Directors’ explanation in the viability assessment of how the y have assessed the prospects of the Gr oup, o ver what period they have done so and why they considered that period to be appr opriate, and their statement as to whether they have a reasonable e xpectation that the Group will be able to continue in oper ation and meet its liabilities as they fall due over the period of their assessment, including any related disclosures dr awing attention to any necessary qualiﬁcations or assumptions. We ar e also required to review the Viability Statement set out on page 82 under the Listing Rules. Based on the above pr ocedures, we have concluded that the above disclosures ar e materially consistent with the Financial Statements and our audit knowledge. Our work is limited to assessing these matters in the context of only the knowledge acquired during our Financial Statements audit. As we cannot predict all futur e events or conditions and as subsequent events may result in outcomes that ar e inconsistent with judgments that were reasonable at the time they wer e made, the absence of an ything to report on these statements is not a guarantee as to the Gr oup’s and Company’s longer-term viability . Corporate governance disclosur es We ar e required to perform procedur es to identify whether there is a material inconsistency between the Directors’ corpor ate governance disclosures and the Financial Statements and our audit knowledge. Based on those procedur es, we ha ve concluded that each of the followingis materially consistent with the Financial Statements andouraudit knowledge: the Directors’ statement that they consider that the Annual R eport andFinancial Statements taken as a whole is fair , balanced and understandable, and provides the information necessary for shareholders to assess the Gr oup’s position and performance, businessmodel and strategy; the section of the Annual Report describing the work of the Audit Committee, including the signiﬁc ant issues that the Audit Committee considered in r elation to the Financial Statements, and how these issues were addr essed; and the section of the Annual Report that describes the review of the eectiveness of the Group’s risk management and internal contr ol systems. We ar e required to review the part of the Corpor ate Governance Statement relating to the Gr oup’s compliance with the provisions of the UK Corporate Gov ernance Code speciﬁed by the Listing Rules for our review . W e have nothing to report in this r espect . 7 W e have nothing to r eport on the other matters on which we are r equired to report b y exc eption Under the Companies (Jersey) Law , 1991 and the terms of our engagement, we ar e requir ed to report to you if , in our opinion: proper accounting r ecords have not been k ept by the Company; or proper r eturns adequate for our audit have not been r eceived from branches not visited by us; or the Company’s Financial Statements and the part of the Report on Directors’ R emuneration which we wer e engaged to audit are not in agreement with the accounting r ecords and r eturns; or we have not received all the inf ormation and explanations we requir efor our audit. We ha ve nothing to report in these r espects. 8 Respectiv e responsibilities Directors’ r esponsibilities As explained more fully in their statement set out on page 137, the Directors ar e responsible for: the prepar ation of Financial Statements which give a true and fair view; such internal control as they determine is necessary to enable the prepar ation of Financial Statements that are free from material misstatement, whether due to fr aud or error; assessing the Group and P arent Company’s ability to continue as a going concern, disclosing, as applic able, matter s related to going concern; and using the going concern basis of accounting unless they either intend to liquidate the Group or the P arent Company or to cease oper ations, or have no realistic alternative but to do so. Experian plc Financial statements 146 Independent auditor’s report Co ntinued 8 Respectiv e responsibilities c ontinued Auditor’s responsibilities Our objectives are to obtain r easonable assurance about whether the Financial Statements as a whole are fr ee from material misstatement, whether due to fraud or err or , and to issue our opinion in an auditor’s report. Reasonable assur ance is a high level of assur ance, but does not guarantee that an audit conducted in accor dance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fr aud or error and are considered material if , individually or in aggregate, they could reasonabl y be expected to inﬂuence the economic decisions of users taken on the basis of the Financial Statements. A fuller description of our responsibilities is pr ovided on the FRC’s websiteat www .frc.org.uk/auditorsr esponsibilities. 9 The purpose of our audit work and to whom w e owe our responsibilities This report is made solely to the Company’s member s, as a body , in accordance with Article 113A of the Companies (Jersey) La w 1991 and the terms of our engagement by the Company . Our audit work has been undertaken so that we might state to the Company’s members those matters we are r equired to state to them in an auditor’s report, and the further matters we are r equired to state to them in accordance with the terms agreed with the Company , and for no other purpose. T o the fullest extent permitted by law , we do not accept or assume r esponsibility to anyone other than the Company and the Company’s member s, as a body , for our audit work, f or this report, or for the opinions we have formed. Andrew Bradshaw for and on behalf of KPMG LLP Chartered Accountants and Recognized A uditor 15 Canada Square, London E14 5GL United Kingdom 18 May 2021 147 Experian plc Annual Report 2021 Financial statements Notes 2021 2020 Benchmark 1 US$m Non- benchmark 2 US$m Total US$m Benchmark 1 US$m Non- benchmark 2 US$m Total US$m Revenue 8,9 5,372 — 5,372 5,179 — 5,179 Labour costs 11(a) (1,965) (30) (1,995) (1,864) (8) (1,872) Data and information technology costs (861) — (861) (753) — (753) Amortisation and depreciation charges 12 (453) (138) (591) (413) (124) (537) Marketing and customer acquisition costs (417) — (417) (378) — (378) Other operating charges (295) (150) (445) (392) (62) (454) Total operating expenses (3,991) (318) (4,309) (3,800) (194) (3,994) Proﬁt on disposal of associate 14(b) — 120 120 — — — Operating proﬁt/(loss) 1,381 (198) 1,183 1,379 (194) 1,185 Interest income 12 — 12 13 — 13 Finance expense (133) (6) (139) (145) (125) (270) Net ﬁnance costs 15 (121) (6) (127) (132) (125) (257) Share of post-tax proﬁt of associates 5 16 21 8 6 14 Proﬁt/(loss) before tax 9 1,265 (188) 1,077 1,255 (313) 942 Tax (charge)/credit 16 (328) 53 (275) (324) 61 (263) Proﬁt/(loss) for the ﬁnancial year from continuing operations 937 (135) 802 931 (252) 679 Loss for the ﬁnancial year from discontinued operations 17 — — — — (2) (2) Proﬁt/(loss) for the ﬁnancial year 937 (135) 802 931 (254) 677 Attributable to: Owners of Experian plc 938 (135) 803 929 (254) 675 Non-controlling interests (1) — (1) 2 — 2 Proﬁt/(loss) for the ﬁnancial year 937 (135) 802 931 (254) 677 Total Benchmark EBIT 1 9(a)(i) 1,386 1,387 Notes US cents US cents US cents US cents US cents US cents Earnings/(loss) per share Basic 18(a) 103.1 (14.9) 88.2 103.0 (28.2) 74.8 Diluted 18(a) 102.3 (14.7) 87.6 102.1 (27.9) 74.2 Earnings/(loss) per share from continuing oper ations Basic 18(a) 103.1 (14.9) 88.2 103.0 (28.0) 75.0 Diluted 18(a) 102.3 (14.7) 87.6 102.1 (27.7) 74.4 Benchmark PBT per share 1,3 139.0 139.1 Full -year dividend per share 1 19 47.0 47.0 1 T otal Benchmark EBIT , Benchmark PBT per shar e and Full- year dividend per share ar e non-GAAP measures, deﬁned in note 6. 2 The loss before tax for non-benchmark items of US$188m (2020: US$313m) comprises a net credit for Exceptional items of US$35m (2020: char ge of US$35m) and net charges for other adjustments made to derive Benchmark PBT of US$223m (2020: US$278m). F urther information is given in note 14. 3 Benchmark PBT per share is calculated by dividing Benchmark PBT of US$1,265m (2020: US$1,255m) by the weighted aver age number of ordinary shares of 910 million (2020: 902 million). The amount is stated in US cents per share. Group income statement for the year ended 31 March 2021 Experian plc Financial statements 148 2021 US$m 2020 US$m Proﬁt for the ﬁnancial year 802 677 Other comprehensive income Items that will not be reclassiﬁed to pr oﬁt or loss: Remeasurement of post -employment beneﬁt assets and obligations (note 35(b)) 2 26 Changes in the fair value of investments r evalued through OCI 11 (6) Deferred tax char ge (1) (5) Items that will not be reclassiﬁed to pr oﬁt or loss 12 15 Items that are or may be r eclassiﬁed subsequently to proﬁt or loss: Currency tr anslation gains/(losses) 70 (313) F air value gain on cash ﬂow hedge 35 — Hedging gain reclassiﬁed to pr oﬁt or loss (33) — Items that are or may be r eclassiﬁed subsequently to proﬁt or loss 72 (313) Other comprehensive income for the ﬁnancial year 1 84 (298) T otal comprehensive income for the ﬁnancial year 886 379 Attributable to: Owners of Experian plc 881 378 Non-controlling inter ests 5 1 T otal comprehensive income for the ﬁnancial year 886 379 1 Amounts reported within Other comprehensive income (OCI) are in r espect of continuing operations and, except as reported for post -employment beneﬁt assets and obligations, ther e is no associated tax. Currency tr anslation items, not reclassiﬁed to pr oﬁt or loss, ar e recognised in the tr anslation reserve within other reserves and in non-contr olling interests. Other items within Other comprehensive income ar e recognised in retained earnings. Group statement of comprehensiv e income for the year ended 31 March 2021 149 Experian plc Annual Report 2021 Financial statements Notes 2021 US$m 2020 US$m Non-current assets Goodwill 20 5,261 4,543 Other intangible assets 21 1,966 1,583 Property , plant and equipment 22 469 502 Investments in associates 23 128 123 Deferred tax assets 36(a) 86 107 Post-employment beneﬁt assets 35(a) 102 83 T rade and other receivables 24(a) 160 164 Financial assets revalued thr ough OCI 30(a) 245 171 Other ﬁnancial assets 30(b) 223 223 8,640 7,499 Current assets T rade and other receivables 24(a) 1,197 1,078 Current tax assets 36(b) 34 28 Other ﬁnancial assets 30(b) 20 17 Cash and cash equivalents - excluding bank o verdr afts 25(a) 180 277 1,431 1,400 Current liabilities T rade and other payables 26(a) (1,543) (1,430) Borrowings 27(a) (655) (498) Current tax liabilities 36(b) (176) (225) Provisions 37 (27) (48) Other ﬁnancial liabilities 30(b) (15) (23) (2,416) (2,224) Net current liabilities (985) (824) T otal assets less current liabilities 7,655 6,675 Non-current liabilities T rade and other payables 26(a) (159) (121) Borrowings 27(a) (3,682) (3,916) Deferred tax liabilities 36(a) (361) (202) Post-employment beneﬁt obligations 35(a) (55) (48) Other ﬁnancial liabilities 30(b) (279) (107) (4,536) (4,394) Net assets 3,119 2,281 Equity Called-up share capital 38 96 96 Share pr emium account 38 1,756 1,574 Retained earnings 39(a) 19,207 18,826 Other reserves 39(b) (17,978) (18,221) Attributable to owners of Experian plc 3,081 2,275 Non-controlling inter ests 38 6 T otal equity 3,119 2,281 These ﬁnancial statements were appr oved by the Boar d on 18 May 2021 and were signed on its behalf by: Kerry Williams Director Group balance sheet at 31 March 2021 Experian plc Financial statements 150 Called-up share capital (Note 38) US$m Share premium account (Note 38) US$m Retained earnings (Note 39) US$m Other reserves (Note 39) US$m Attributable to owners of Experian plc US$m Non- controlling interests US$m T otal equity US$m At 1 April 2020 96 1,574 18,826 (18,221) 2,275 6 2,281 Comprehensive income: Proﬁt for the ﬁnancial year — — 803 — 803 (1) 802 Other comprehensive income for the ﬁnancial y ear — — 12 66 78 6 84 T otal comprehensive income for the ﬁnancial year — — 815 66 881 5 886 T ransactions with owner s: Employee share incentive plans: – value of employee services — — 106 — 106 — 106 – shares issued on vesting — 19 — — 19 — 19 – other vesting of awards and ex ercises of shar e options — — (75) 87 12 — 12 – related tax cr edit — — 2 — 2 — 2 – other payments — — (6) — (6) — (6) Shares deliver ed as consideration f or acquisition — 163 — 90 253 — 253 Non-controlling inter ests arising on business combinations — — (34) — (34) 24 (10) Recognition of non-controlling inter ests on acquisition — — — — — 4 4 Dividends paid — — (427) — (427) (1) (428) T ransactions with owner s — 182 (434) 177 (75) 27 (48) At 31 March 2021 96 1,756 19,207 (17,978) 3,081 38 3,119 Called-up share capital (Note 38) US$m Share premium account (Note 38) US$m Retained earnings (Note 39) US$m Other reserves (Note 39) US$m Attributable to owners of Experian plc US$m Non- controlling interests US$m T otal equity US$m At 1 April 2019 96 1,559 18,718 (17,893) 2,480 14 2,494 Comprehensive income: Proﬁt for the ﬁnancial year — — 675 — 675 2 677 Other comprehensive income for the ﬁnancial y ear — — 15 (312) (297) (1) (298) T otal comprehensive income for the ﬁnancial year — — 690 (312) 378 1 379 T ransactions with owners: Employee share incentive plans: – value of employee services — — 83 — 83 — 83 – shares issued on vesting — 15 — — 15 — 15 – purchase of shar es by employee trusts — — — (92) (92) — (92) – other vesting of awards and ex ercises of shar e options — — (64) 76 12 — 12 – related tax cr edit — — 5 — 5 — 5 – other payments — — (5) — (5) — (5) Purchase and cancellation of o wn shares — — (112) — (112) — (112) T ransactions in respect of non-contr olling interests — — (65) — (65) (7) (72) Dividends paid — — (424) — (424) (2) (426) T ransactions with owners — 15 (582) (16) (583) (9) (592) At 31 March 2020 96 1,574 18,826 (18,221) 2,275 6 2,281 Group statement of changes in equity for the year ended 31 March 2021 151 Experian plc Annual Report 2021 Financial statements Notes 2021 US$m 2020 US$m Cash ﬂows from oper ating activities Cash generated fr om oper ations 40(a) 1,822 1,694 Interest paid (119) (157) Interest r eceived 4 5 Dividends received fr om associates 17 6 T ax paid (236) (286) Net cash inﬂow fr om operating activities – continuing oper ations 1,488 1,262 Net cash outﬂow fr om operating activities – discontinued oper ations 17 — (6) Net cash inﬂow from oper ating activities 1,488 1,256 Cash ﬂows from investing activities Purchase of other intangible assets 40(c) (374) (403) Purchase of pr operty , plant and equipment (48) (84) Sale of property , plant and equipment 1 5 Purchase of other ﬁnancial assets (31) (95) Sale of other ﬁnancial assets 24 — Acquisition of subsidiaries, net of c ash acquired 40(d) (526) (600) Disposal of investment in associate 14(b), 23 127 — Net cash ﬂows used in in vesting activities (827) (1,177) Cash ﬂows from ﬁnancing activities Cash inﬂow in respect of shar es issued 40(e) 19 15 Cash outﬂow in respect of shar e purchases 40(e) — (203) Other payments on vesting of share awar ds (6) (5) T ransactions in respect of non-contr olling interests 40(d) (10) (67) New borrowings 1,011 1,519 Repayment of borrowings (1,337) (553) Payment of lease liabilities (56) (55) Net receipts/(payments) for cr oss-currency swaps and f oreign exchange contr acts 54 (169) Net receipts fr om equity swaps 6 5 Dividends paid (428) (426) Net cash ﬂows (used in)/fr om ﬁnancing activities (747) 61 Net (decrease)/increase in c ash and cash equivalents (86) 140 Cash and cash equivalents at 1 April 272 146 Exchange movements on cash and c ash equivalents (16) (14) Cash and cash equivalents at 31 March 40(f) 170 272 Group c ash ﬂow statement for the year ended 31 March 2021 Experian plc Financial statements 152 1. Corpor ate information Experian plc(the Company) is the ultimate parent compan y of the Experian group of companies (Experian or the Gr oup). Experian is a leading global information services group. The Company is incorpor ated and register ed in Jersey as a public company limited by shares and is r esident inIreland. The Compan y’s register ed oce is at 22 Grenville Str eet, St Helier , Jersey , JE4 8PX, Channel Islands. The Company’s ordinary shar es are traded on the London Stock Exchange’s Regulated Market and have a Pr emium Listing. There has been no change in this information since the Annual R eport for the year ended 31 March 2020. 2. Basis of pr eparation The Group ﬁnancial statements ar e: prepar ed in accordance with the Companies (Jersey) La w 1991 and International Financial Reporting Standards (IFRS or IFRSs) as adopted for use in the European Union (the EU) and IFRS Interpr etations Committee interpretations (together EU-IFRS). The ﬁnancial statements also comply with IFRS as issued by the International Accounting Standards Boar d (IASB). EU-IFRS dier s in certain respects fr om IFRS as issued by the IASB, however , the dierences have no material impact for the periods presented; prepar ed on the going concern basis and under the historical cost convention, as modiﬁed for the rev aluation of certain ﬁnancial assets and ﬁnancial liabilities; presented in US dollars, the most representative curr ency of the Group’s oper ations, and generally r ounded to the nearest million; prepar ed using the principal exchange rates set out in note 10; and designed to voluntarily include disclosures in line with those parts of the UK Companies Act 2006 applicable to companies r eporting under IFRS. The Company’s own ﬁnancial statements are pr epared under UK accounting standards in accor dance with FRS 101 ‘Reduced Disclosure Fr amework’ . There has been no change in the basis of pr eparation of the Gr oup ﬁnancial statements since the Annual Report for the year ended 31 Mar ch 2020. The use of critical accounting estimates and management judgment is requir ed in applying the accounting policies. Ar eas involving a higher degree of judgment or complexity , or where assumptions and estimates are signiﬁc ant to the Group ﬁnancial statements, are highlighted in note 5. Going concern In adopting the going concern basis for preparing these ﬁnancial statements, the dir ectors have consider ed the business activities, the principal risks and uncertainties and the other matters discussed in connection with the Viability statement. At 31 March 2021, the Group had undrawn committed bank borr owing facilities of US$2.7bn which have an aver age remaining tenor of four years. The directors believe that the Gr oup is well placed to manage its ﬁnancing and other business risks satisfactorily , and ha ve a reasonable expectation that the Group will have adequate r esources to continue in operational existence for at least 12 months from the date of signing these ﬁnancial statements. The directors ther efore consider it appropriate to adopt the going concern basis of accounting in preparing the ﬁnancial statements. In reaching this conclusion, the director s noted the Group’s str ong cash performance in the year . 3. R ecent ac counting developments There have been no accounting standar ds, amendments or interpretations eective for the ﬁr st time in these ﬁnancial statements which have had a material impact on the ﬁnancial statements. Interest Rate Benchmark Ref orm - Phase 1, Amendments to IFRS 9 ‘Financial Instruments’ , IAS 39 ‘Financial Instruments: Recognition and Measurement’ and IFRS 7 ‘Financial Instruments: Disclosur es’ provide relief fr om the discontinuation of hedge accounting as a result of interbank oered r ate (IBOR) reform. Interest Rate Benchmark Ref orm - Phase 2, Amendments to IFRS 9, IAS 39 and IFRS 7 is eective for Experian from FY22. By applying the practic al expedient in IFRS 9, the Gr oup does not expect to be required to discontinue its hedging relationships as a r esult of changes in refer ence rates due to IBOR r eform. There ar e no other new standards, amendments to existing standards, or interpretations that ar e not yet eective, that are expected to hav e a material impact on the Group’s ﬁnancial r esults. Accounting developments are r outinely reviewed by the Gr oup and its ﬁnancial reporting systems ar e adapted as appropriate. 4. Signiﬁc ant acc ounting policies The signiﬁcant accounting policies applied ar e summarised below . They have been applied consistently to both years pr esented. The explanations of these policies focus on areas wher e judgment is applied or which are particularly important in the ﬁnancial statements. F or ease of reference, the content within this note is arranged as follo ws: sections (a) to (d) – content that applies generally to the pr eparation of these ﬁnancial statements; sections (e) to (p) – balance sheet policies, to be r ead in conjunction with speciﬁc notes as indicated; sections (q) to (x) – income statement policies, to be r ead in conjunction with speciﬁc notes as indicated; and section (y) – the policy and presentation principles adopted for disclosing segment information, in accor dance with IFRS 8 ‘Operating Segments’ . (a) Basis of consolidation The Group ﬁnancial statements incorpor ate the ﬁnancial statements of the Company and its subsidiary undertakings. Subsidiaries Subsidiaries are fully consolidated fr om the date on which control is transferr ed to the Group and cease to be consolidated from the date that the Group no longer has contr ol. All business combinations ar e accounted for using the acquisition method. Intra-Gr oup transactions, balances and unr ealised gains on transactions between Group companies ar e eliminated on consolidation. Unr ealised losses are also eliminated unless the tr ansaction provides evidence of an impairment of the asset transferr ed. Accounting policies of subsidiaries and segments are consistent with the policies adopted by the Group for the purposes of the Gr oup’s consolidation. The Group ﬁnancial statements incorpor ate the ﬁnancial statements of the Company and its subsidiary undertakings for the year ended 31 March 2021. A full list of subsidiary undertakings is given in note S to the Company ﬁnancial statements. Associates Interests in associates ar e accounted for using the equity method. They are initially r ecognised at cost, which includes tr ansaction costs. Subsequent to initial recognition, the Group ﬁnancial statements include the Group’s shar e of the proﬁt or loss and other compr ehensive income of equity-accounted investees, until the date on which signiﬁcant inﬂuence ceases. Gains or losses on disposal ar e recognised within oper ating proﬁt. Notes to the Group ﬁnancial statements for the year ended 31 March 2 02 1 153 Experian plc Annual Report 2021 Financial statements 4. Signiﬁc ant acc ounting policies continued Non-controlling interests The non-controlling inter ests in the Group balance sheet r epresent the share of net assets of subsidiary undertakings held outside the Gr oup. The movement in the year comprises the pr oﬁt attributable to such interests together with any dividends paid, movements in respect of corpor ate transactions and r elated exchange dierences. The Group tr eats transactions with non-contr olling interests that do not result in a loss of contr ol as transactions with equity owner s of the Group. F or purchases fr om non-controlling inter ests, the dier ence between any consideration paid and the r elevant share acquired of the carrying v alue of the net assets of the subsidiary is recor ded in equity . Gains or losses on disposals to non-controlling inter ests are also r ecorded in equity . Where put option agr eements are in place in r espect of shares held by non-controlling shar eholders, the liability is stated at the present v alue of the expected future payments. Such liabilities are shown as ﬁnancial liabilities in the Group balance sheet. The change in the value of such options in the year is recognised in the Gr oup income statement within net ﬁnance costs, while an y change in that value attributable to exchange r ate movements is recognised dir ectly in Other comprehensive income (OCI). Where put option agr eements are in place the Gr oup adopts the ‘anticipated acquisition’ approach, recor ding the other side of the put liability against goodwill, with no subsequent pr oﬁts attributed to non-controlling inter ests. (b) F oreign currency translation T ransactions and balances T ransactions in foreign curr encies are r ecorded in the functional currency of the relevant Gr oup undertaking at the exchange rate prev ailing on the date of the transaction. At each balance sheet date, monetary assets and liabilities denominated in foreign curr encies are r etranslated at the exchange rate pr evailing at the balance sheet date. T ranslation dier ences on monetary items are taken to the Gr oup income statement except when recognised in OCI, as qualifying net investment hedges or cash ﬂo w hedges. T ranslation dierences on non-monetary ﬁnancial assets r evalued through OCI ar e reported as part of the fair v alue gains or losses in OCI. Group undertakings The results and ﬁnancial position of Gr oup undertakings whose functional currencies ar e not the US dollar are tr anslated into US dollars as follows: Income and expenses are gener ally tr anslated at the aver age exchange rate for the y ear . Where this av erage is not a r easonable appro ximation of the cumulative eect of the rates pr evailing on the transaction dates, income and expenses are tr anslated at the rates on the dates of the transactions. Assets and liabilities are tr anslated at the closing exchange r ate on the balance sheet date. All resulting exchange dier ences are r ecognised in OCI and as a separate component of equity . On consolidation, exchange dier ences arising from the translation of the net investment in Group undertakings whose functional curr encies are not the US dollar , and of borr owings and other currency instruments designated as hedges of such investments, are r ecognised in OCI to the extent that such hedges are eective. T ax attributable to those exchange dierences is taken dir ectly to OCI. When such undertakings ar e sold, these exchange dierences ar e recognised in the Gr oup income statement as part of the gain or loss on sale. Goodwill and fair v alue adjustments arising on the acquisition of such undertakings are tr eated as assets and liabilities of the entities and are tr anslated into US dollars at the closing exchange rate. (c) F air value estimation The fair values of derivative ﬁnancial instruments and other ﬁnancial assets and liabilities are determined by using market data and established estimation techniques such as discounted cash ﬂow and option valuation models. The fair value of for eign exchange contracts is based on a comparison of the contractual and y ear-end exchange r ates. The fair values of other derivative ﬁnancial instruments ar e estimated by discounting the future c ash ﬂows to net present v alues, using appr opriate market r ates prevailing at the y ear-end. (d) Impairment of non-ﬁnancial assets Assets that are not subject to amortisation or depr eciation are tested annually for impairment. Assets that ar e subject to amortisation or depreciation ar e reviewed for impairment when ther e is an indication that the carrying amount may not be r ecover able. An impairment char ge is recognised for the amount by which an asset’s c arrying amount exceeds its recover able amount, which is the higher of an asset’s fair value less costs of disposal, and v alue-in-use. F or the purposes of assessing impairment, assets are gr ouped into cash gener ating units (CGUs), determined by the lowest levels for which there ar e separately identiﬁable cash ﬂows. (e) Goodwill (note 20) Goodwill is stated at cost less any accumulated impairment, wher e cost is the excess of the fair value of the consider ation payable for an acquisition over the fair value at the date of acquisition of the Gr oup’s share of identiﬁable net assets of a subsidiary or associate acquired. F air values are attributed to the identiﬁable assets, liabilities and contingent liabilities that existed at the date of acquisition, r eﬂecting their condition at that date. Adjustments ar e made where necessary to align the accounting policies of acquired businesses with those of the Gr oup. Goodwill is not amortised but is tested annually for impairment, or mor e frequently if there is an indic ation that it may be impaired. An impairment charge is recognised in the Gr oup income statement for any amount by which the carrying value of the goodwill exceeds the r ecoverable amount. Goodwill is allocated to CGUs and monitor ed for internal management purposes by operating segment. The allocation is made to those CGUs or groups of CGUs that ar e expected to beneﬁt from the business combination in which the goodwill arose. Gains and losses on the disposal of an undertaking take account of the carrying amount of goodwill r elating to the undertaking sold, alloc ated where necessary on the basis of r elative fair value. (f) Other intangible assets (note 21) Acquisition intangibles Intangible assets acquired as part of a business combination ar e capitalised on acquisition at fair value and separ ately from goodwill, if those assets are identiﬁable (separ able or arising from legal rights). Such assets are r eferred to as acquisition intangibles in these ﬁnancial statements. Amortisation is char ged on a str aight-line basis as follow s: Customer and other relationships – over thr ee to 18 years, based on management’s estimates of the aver age lives of such relationships, and reﬂecting their long-term natur e. Acquired softwar e development – over thr ee to eight years, based on the asset’s expected life. Marketing-related assets (tr ademarks and licences) – over their contractual lives, up to a maximum of 20 years. Marketing-related assets (tr ade names) – over three to 14 years, based on management’s expected retention of tr ade names within the business. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 154 4. Signiﬁc ant acc ounting policies continued Other intangibles Other intangibles are c apitalised at cost. Certain costs incurr ed in the developmental phase of an internal project ar e capitalised pr ovided that a number of criteria are satisﬁed. These include the technic al feasibility of completing the asset so that it is available for use or sale, the availability of adequate resour ces to complete the development and to use or sell the asset, and how the asset will gener ate probable future economic beneﬁt. The cost of such assets with ﬁnite useful economic or contractual lives is amortised on a straight -line basis over those lives. The carrying v alues are r eviewed for impairment when events or changes in circumstances indicate that the carrying v alues may not be recover able. If impaired, the carrying values ar e written down to the higher of fair value less costs of disposal, and v alue-in-use which is determined by refer ence to projected future income str eams using assumptions in respect of pr oﬁtability and growth. Further details on the c apitalisation and amortisation policy for the key asset classiﬁcations within other intangibles ar e: Databases – capitalised databases, which comprise the data purchase and captur e costs of internally developed databases, ar e amortised over three to seven y ears. Computer software (internal use) – computer softwar e licences purchased for internal use ar e capitalised on the basis of the costs incurred to pur chase and bring into use the speciﬁc software. These costs are amortised over thr ee to ten years. Computer software (internally gener ated) – costs directly associated with producing identiﬁable and unique softwar e products contr olled by the Group, and that will gener ate economic beneﬁts beyond one year , are r ecognised as intangible assets. These costs are amortised over three to ten year s. Research expenditur e, together with other costs associated with developing or maintaining computer software pr ogr ams or databases, is recognised in the Gr oup income statement as incurred. (g) Property , plant and equipment (note 22) Purchased items of pr operty , plant and equipment ar e held at cost less accumulated depreciation and any impairment in v alue. Cost includes the original purchase price of the asset and amounts attributable to bringing the asset to its working condition for its intended use. Depreciation is char ged on a straight -line basis as follows: Fr eehold properties – ov er 50 years. Leasehold improvements to short leasehold pr operties – over the remaining period of the lease. Plant and equipment – over three to ten year s, accor ding to the asset ’s estimated useful life. T echnology-based assets ar e typically depr eciated over three to ﬁve y ears, with other infrastructur e assets depreciated over ﬁve to ten years. (h) T rade and other receivables (note 24) T rade receivables and contr act assets are initially recognised at fair v alue and subsequently measured at this v alue less loss allowances. Where the time value of money is material, receivables ar e then carried at amortised cost using the eective interest method, less loss allowances. We apply the IFRS 9 simpliﬁed lif etime expected credit loss appr oach. Expected credit losses ar e determined using a combination of historical experience and forward-looking inf ormation. Impairment losses or cr edits in respect of tr ade receivables and contract assets ar e recognised in the Group income statement, within other oper ating charges. (i) Cash and cash equivalents (note 25) Cash and cash equivalents include c ash in hand, term and c all deposits held with banks and other short-term, highly liquid investments with original maturities of three months or less. Bank over drafts ar e shown within borrowings in curr ent liabilities in the Group balance sheet. For the purposes of the Group c ash ﬂow statement, c ash and cash equivalents are r eported net of bank overdr afts. ( j) Financial assets and liabilities (note 30) Financial assets We classify our ﬁnancial assets into the follo wing measurement categories, with the classiﬁcation determined on initial r ecognition and dependent on the purpose for which such assets are acquir ed: those subsequently measured at fair value (either thr ough OCI or through pr oﬁt or loss), and those measured at amortised cost. Directly attributable tr ansaction costs are expensed where an asset is carried at ‘fair value thr ough proﬁt or loss’ (FVPL) and added to the fair value of the asset otherwise. Financial assets with embedded derivatives ar e considered in their entirety when determining whether their c ash ﬂows are solely a payment of principal and interest. Debt instruments Measurement of debt instruments depends on the Gr oup’s business model for managing the asset and the cash ﬂow char acteristics of the asset. There ar e three measur ement categories into which the Gr oup classiﬁes debt instruments: Amortised cost: Assets that are held for collection of contr actual cash ﬂows where those c ash ﬂows ar e solely repayments of principal and interest ar e measured at amortised cost. Interest income from these ﬁnancial assets is recognised using the eective inter est method. An y impairment or gain or loss on derecognition is r ecognised directly in the Group income statement. F air value through Other comprehensive income (FVOCI): Assets that are held both for the collection of contr actual cash ﬂows and for their sale, wher e the asset’s cash ﬂows solel y repr esent payments of principal and interest, are measur ed at FVOCI. Movements in the carrying amount ar e taken through OCI, however recognition of impairment gains or losses, inter est income and for eign exchange gains or losses are r ecognised in the Group income statement. FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measur ed at FVPL. A gain or loss on a debt instrument that is subsequently measured at FVPL is r ecognised in the Group income statement and presented net within other gains or losses in the period in which it arises. 155 Experian plc Annual Report 2021 Financial statements 4. Signiﬁc ant acc ounting policies continued Equity instruments We measur e all equity instruments at fair value. Wher e we have elected to present fair value gains or losses on equity in vestments in OCI, ther e is no subsequent reclassiﬁc ation of fair value gains or losses to the Group income statement following the derecognition of the in vestment. Dividends from such investments ar e normally recognised as other income when the Group’s right to r eceive payments is established. Changes in the fair value of ﬁnancial assets at FVPL are r ecognised in other gains or losses in the Group income statement. Impairment losses, and reversals of impairment losses, on equity investments measured at FVOCI are not r eported separately from other changes in fair value. Impairment The loss allowances for ﬁnancial assets are based on assumptions about signiﬁcant incr eases in credit risk and subsequent risk of default. W e use judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the Group’s history , existing market conditions as well as forward-looking estimates at the end of each reporting period. Financial liabilities Financial liabilities are measur ed subsequently at amortised cost using the eective interest method or at FVPL. Financial liabilities are classiﬁed at FVPL when the ﬁnancial liability is held for trading, it is a derivative or it is designated at FVPL on initial recognition. Financial liabilities at FVPL are measured at fair value, with any net gains or losses arising on changes in fair value, including any interest expense, recognised in the Group income statement. Other ﬁnancial liabilities are subsequently measur ed at amortised cost using the eective interest method. Interest expense, for eign exchange gains and losses and any gain or loss on derecognition ar e recognised in the Group income statement. The eective interest method is a method of c alculating the amortised cost of a ﬁnancial liability and of allocating inter est expense over the relevant period. The eective interest r ate is the rate that exactly discounts estimated future c ash payments, including all fees that f orm an integral part of the eective inter est rate, tr ansaction costs and other premiums or discounts, through the expected lif e of the ﬁnancial liability . Derivatives used for hedging The Group uses derivativ e ﬁnancial instruments to manage its exposures to ﬂuctuations in foreign exchange r ates, interest r ates and certain obligations relating to shar e incentive plans, including social security obligations. Instruments used include inter est r ate swaps, cr oss-currency swaps, for eign exchange contracts and equity swaps. These are recognised as assets or liabilities as appr opriate and are classiﬁed as non-current, unless they mature within one y ear of the balance sheet date. Derivatives ar e initially recognised at their fair value on the date the contract is enter ed into, and are subsequently r emeasured at their fair value. The method of recognising the r esulting gain or loss depends on whether the derivative is designated as a hedging instrument and, if so, the nature of the hedge r elationship. The Group designates certain derivativ es as either fair value hedges or cash ﬂow hedges. F air value hedges are hedges of the fair value of a recognised asset or liability . Cash ﬂow hedges are hedges of highly probable futur e foreign curr ency cash ﬂows. The Gr oup does not currently enter into net investment hedges. We document the r elationship between hedging instruments and hedged items, and our risk management objective and str ategy for undertaking hedge transactions, at the hedge inception. W e also document our assessment of whether the derivatives used in hedging meet the hedge eectiveness criteria set out in IFRS 9. This assessment is performed at every reporting date thr oughout the life of the hedge to conﬁrm that the hedge continues to meet the hedge eectiveness criteria. Hedge accounting is discontinued when the hedging instrument expires, is sold, terminated or exercised, or no longer qualiﬁes for hedge accounting. Amounts payable or receiv able in respect of inter est r ate swaps, together with the interest dier entials reﬂected in for eign exchange contracts, ar e recognised in net ﬁnance costs over the period of the contr act. Changes in the fair value of derivatives that ar e designated and qualify as fair value hedging instruments are r ecognised in the Group income statement, together with any changes in the fair v alue of the hedged asset or liability that are attributable to the hedged risk. The ineective portion of a fair value hedge is recognised in net ﬁnance costs in the Gr oup income statement. The eective portion of changes in the fair value of derivatives that ar e designated and qualify as cash ﬂow hedging instruments is r ecognised in OCI, while an y ineective part is recognised in the Gr oup income statement. Amounts r ecorded in OCI ar e recycled to the Group income statement in the same period in which the underlying foreign curr ency exposure aects the Gr oup income statement. Non-hedging derivatives Changes in the fair value of derivative instruments used to manage exposures, that are not part of a documented hedge relationship under IFRS 9, ar e recognised immediately in the Gr oup income statement. Cost and income amounts in respect of derivativ es entered into in connection with social security obligations on employee share incentive plans, other than amounts of a ﬁnancing nature, are char ged or credited within labour costs. Other costs and changes in the fair v alue of such derivatives ar e charged or cr edited within ﬁnancing fair value r emeasurements in the Group income statement. (k) T rade and other payables (note 26) T rade payables and contr act liabilities are r ecognised initially at fair value. Where the time value of mone y is material, payables and contr act liabilities are then c arried at amortised cost using the eective interest method. (l) Borrowings (note 27) Borrowings ar e recognised initially at fair v alue, net of an y transaction costs incurred. Borrowings ar e subsequently stated at amortised cost, except where they ar e hedged by an eective fair value hedge, in which case the carrying v alue is adjusted to reﬂect the fair v alue movements associated with the hedged risk. Borrowings ar e classiﬁed as non-current to the extent that the Gr oup has an unconditional right to defer settlement of the liability for at least one year after the balance sheet date. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 156 4. Signiﬁc ant acc ounting policies continued (m) Leases (note 29) The Group undertakes an assessment of whether a contr act is or contains a lease at its inception. The assessment establishes whether the Group obtains substantially all the economic beneﬁts from the use of an asset and whether we have the right to direct its use. Low-v alue lease payments are r ecognised as an expense, on a straight -line basis over the lease term. F or other leases we recognise both a right-of-use asset and a lease liability at the commencement date of a lease contract. The right-of-use asset is initially measur ed at cost, comprising the initial amount of the lease liability adjusted for payments made at or before the commencement date, plus initial dir ect costs and an estimate of the cost of any obligation to refurbish the asset or site, less lease incentives. Subsequently , right-of -use assets are measur ed at cost less accumulated depreciation and impairment losses and ar e adjusted for any remeasur ement of the lease liability . Depr eciation is calculated on a straight -line basis over the shorter of the lease period or the estimated useful life of the right-of-use asset, which is determined on a basis consistent with purchased assets (note 4(g)). The lease term comprises the non-cancellable period of a lease, plus periods covered by an extension option, if it is reasonably certain to be exercised, and periods covered by a termination option if it is reasonably certain not to be exercised. The lease liability is initially measured at the pr esent value of lease payments that are outstanding at the commencement date, discounted at the interest r ate implicit in the lease or if that rate cannot be easily determined the Group’s incr emental borrowing r ate. Lease payments comprise payments of ﬁxed principal, less an y lease incentives, v ariable elements linked to an index, guaranteed r esiduals or buy-out options that ar e reasonably certain to be exer cised. They include payments in respect of optional r enewal periods where these ar e reasonably certain to be exer cised or early termination payments where the lease term reﬂects such an option. The lease liability is remeasur ed when there is a change in futur e lease payments arising from a change in an index or r ate, if there is a change in the Group’s estimate of the amount expected to be payable under a residual value guar antee, or if the Group changes its assessment of whether it will exercise a pur chase, extension or termination option. When a lease liability is remeasur ed, a corr esponding adjustment is made to the carrying amount of the right-of -use asset or is recognised in the Group income statement if the asset is fully depr eciated. The Group pr esents right-of-use assets within pr operty , plant and equipment and lease obligations within the Group balance sheet. (n) Post-employment beneﬁt assets and obligations (note 35) Deﬁned beneﬁt pension arrangements – funded plans The post-employment beneﬁt assets and obligations r ecognised in the Group balance sheet in r espect of funded plans comprise the fair value of plan assets of funded plans less the present value of the r elated deﬁned beneﬁt obligation at that date. The deﬁned beneﬁt obligation is calculated annually by independent qualiﬁed actuaries, using the pr ojected unit credit method. The present value of the deﬁned beneﬁt obligation is determined b y discounting the estimated future c ash outﬂows, using market yields on high-quality corporate pound sterling bonds with maturity terms consistent with the estimated aver age term of the related pension liability . Actuarial gains and losses arising from experience adjustments, and changes in actuarial assumptions, ar e recognised immediately in the Group statement of compr ehensive income. The pension cost recognised in the Gr oup income statement comprises the cost of beneﬁts accrued plus interest on the opening net deﬁned beneﬁt obligation. Service costs and ﬁnancing income and expenses ar e recognised separ ately in the Group income statement. Plan expenses ar e deducted from the expected r eturn on the plan assets over the year . Deﬁned beneﬁt pension arrangements – unfunded plans Unfunded pension obligations are determined and accounted for in accordance with the principles used in r espect of the funded arrangements. Deﬁned contribution pension arrangements The assets of deﬁned contribution plans are held separ ately in independently administered funds. The pension cost recognised in the Group income statement r epresents the contributions payable b y the Group to these funds, in respect of the y ear . Post-retir ement healthc are obligations Obligations in respect of post -retir ement healthcar e plans are c alculated annually by independent qualiﬁed actuaries, using an actuarial methodology similar to that for the funded deﬁned beneﬁt pension arrangements. Actuarial gains and losses arising from experience adjustments, and changes in actuarial assumptions, ar e recognised in the Gr oup statement of comprehensive income. The cost recognised in the Group income statement comprises only interest on the obligations. (o) Own shares (note 39) The Group has a number of equity -settled, shar e-based employee incentive plans. In connection with these, shares in the Company are held by The Experian plc Employee Shar e T rust and the Experian UK Approved All-Employee Shar e Plan. The assets of these entities mainly comprise Experian plc shares, which are shown as a deduction fr om equity at cost. Shares in the Company pur chased and held as treasury shares, in connection with the above plans and any shar e purchase pr ogramme, are also shown as a deduction from equity at cost. The par value of shar es in the Company that are pur chased and cancelled, in connection with any share pur chase progr amme, is accounted for as a reduction in c alled-up share c apital with any cost in excess of that amount being deducted from retained earnings. (p) Assets and liabilities classiﬁed as held-for-sale Assets and liabilities are classiﬁed as held-for -sale when their carrying amounts are to be r ecovered or settled principall y through a sale transaction and a sale is consider ed highly probable. They ar e stated at the lower of the carrying amount and fair value less costs to sell. No depreciation or amortisation is char ged in respect of non-curr ent assets classiﬁed as held-for-sale. (q) Revenue r ecognition (note 8) Revenue is stated net of any sales taxes, rebates and discounts and reﬂects the amount of consider ation we expect to receive in exchange for the transfer of pr omised goods and services. T otal consideration fr om contr acts with customers is allocated to the performance obligations identiﬁed based on their standalone selling price, and is recognised when those performance obligations ar e satisﬁed and the control of goods or services is tr ansferred to the customer , either over time or at a point in time. 157 Experian plc Annual Report 2021 Financial statements 4. Signiﬁc ant acc ounting policies continued The provision and pr ocessing of transactional data is distinguished between contracts that: – provide a service on a per unit basis; where the tr ansfer to the customer of each completed unit is considered satisfaction of a single performance obligation. R evenue is recognised on the tr ansfer of each unit; – provide a service to the customer over the contractual term, normally between one and ﬁve years, where revenue is recognised on the transfer of this service to customer s. F or the majority of contracts this means r evenue is spread evenly over the contract term, as customer s simultaneously receive and consume the beneﬁts of the service; – require an enhanced service at the start, where r evenue is recognised to r eﬂect the upfront beneﬁt the customer r eceives and consumes. R evenue for such contracts is r ecognised proportionally in line with the costs of providing the service. Revenue from r eferral fees for credit pr oducts and white-label partnerships is recognised as tr ansactional revenue. Revenue from tr ansactional batch data arrangements that include an ongoing update service is apportioned across each delivery to the customer and is recognised when the delivery is complete, and control of the batch data passes to the customer . Performance obligations ar e determined based on the frequency of data r efresh: one-o, quarterly , monthly , or r eal-time. Subscription and membership fees for continuous access to a service are r ecognised over the period to which they r elate, usually 1, 12 or 24 months. Customer s simultaneously receive and consume the beneﬁts of the service; therefor e, revenue is r ecognised evenly over the subscription or membership term. Revenue for one-o credit r eports is recognised when the report is delivered to the consumer . Software licence and implementation services ar e primarily accounted for as a single performance obligation, with revenue r ecognised when the combined oering is delivered to the customer . Contract terms normally vary between one and ﬁve years. These services are distinguished between: – Experian-hosted solutions, where the customer has the right to access a software solution over a speciﬁed time period. Customers simultaneously receive and consume the beneﬁts of the service and revenue is spr ead evenly over the period that the service is av ailable; and – On-premise software licence arr angements, wher e the software solution is installed in an environment contr olled by the customer . The arrangement r epresents a right to use licence and so the performance obligation is considered to be fulﬁlled on delivery completion, when contr ol of the conﬁgured solution is passed to the customer . Revenue is r ecognised at that point in time. The delivery of support and maintenance agreements is gener ally considered to be a separ ate performance obligation to provide a technical support service including minor updates. Contract terms ar e often aligned with licence terms. Customer s simultaneously receive and consume the beneﬁts of the service therefor e revenue is spr ead evenly over the term of the maintenance period. The provision of distinct standalone consultancy and pr ofessional services is distinguished between: – Professional consultancy services where the performance obligation is the provision of personnel. Customers simultaneously receive and consume the beneﬁts of the service, and r evenue is recognised o ver time, in line with hour s provided; and – The provision of analytical models and analyses, where the performance obligation is a deliver able, or a series of deliver ables, and revenue is r ecognised on delivery when control is passed to the customer . Sales are typic ally invoiced in the geogr aphic area in which the customer is located. As a result, the geogr aphic location of the invoicing undertaking is used to attribute revenue to individual countries. Accrued income balances, which r epresent the right to consideration in exchange for goods or services that we have tr ansferr ed to a customer , are assessed as to whether they meet the deﬁnition of a contr act asset: When the right to consideration is conditional on something other than the passage of time, a balance is classiﬁed as a contr act asset. This arises where ther e are further performance obligations to be satisﬁed as part of the contract with the customer and typic ally includes balances relating to softwar e licensing contracts. When the right to consideration is conditional only on the passage of time, the balance does not meet the deﬁnition of a contr act asset and is classiﬁed as an unbilled receivable. This typically arises where the timing of the related billing cycle occur s in a period after the performance obligation is satisﬁed. Costs incurred prior to the satisfaction or partial satisfaction of a performance obligation are ﬁrst assessed to see if the y are within the scope of other standards. Wher e they are not, certain costs ar e recognised as an asset providing they r elate directly to a contract (or an anticipated contract), generate or enhance resour ces that will be used in satisfying (or to continue to satisfy) performance obligations in the future and ar e expected to be recover ed from the customer . Costs which meet this criteria are deferr ed as contr act costs and these are amortised on a systematic basis consistent with the pattern of tr ansfer of the related goods or services. Costs to obtain a contract pr edominantly comprise sales commissions costs. Costs to fulﬁl a contract pr edominantly comprise labour costs directly relating to the implementation services pr ovided. Contract liabilities arise when we ha ve an obligation to transfer futur e goods or services to a customer for which we have r eceived consideration, or the amount is due, from the customer , and include both deferred income balances and speciﬁc r eserves. (r) Operating char ges Operating char ges are reported by nature in the Gr oup income statement, reﬂecting the Gr oup’s cost-management contr ol structure. Details of the types of charges within labour costs in r espect of share incentive plans are set out in note 4(u). Those for post-employment beneﬁts are set out in note 4(n). Details of the Group’s amortisation and depr eciation policy are given in notes 4(f), 4(g) and 4(m). The principles upon which impairment charges of tangible and intangible assets are r ecognised are set out in notes 4(d), 4(e) and 4(f). Notes to the Group ﬁnancial statements continued Experian plc Financial statements 158 4. Signiﬁc ant acc ounting policies continued (s) Net ﬁnance costs (note 15) Incremental tr ansaction costs which are directly attributable to the issue of debt are c apitalised and amortised over the expected life of the borrowing, using the eective interest method. All other borr owing costs are char ged in the Group income statement in the year in which the y are incurred. Amounts payable or receiv able in respect of inter est r ate swaps are taken to net ﬁnance costs over the periods of the contr acts, together with the interest dier entials reﬂected in for eign exchange contracts. Details of the nature of movements in the fair v alue of derivatives which are r eported as ﬁnancial fair value r emeasurements ar e included in note 4(j). The change in the y ear in the present value of put option agr eements, in respect of shar es held by non-controlling shar eholders, is recognised as a ﬁnancing fair value remeasur ement within net ﬁnance costs. (t) T ax (note 16) The tax charge or cr edit for the year is r ecognised in the Group income statement, except f or tax on items recognised in OCI or dir ectly in equity . Current tax is c alculated on the basis of the tax laws substantively enacted at the balance sheet date in the countries where the Gr oup operates. Current tax assets and liabilities are oset wher e there is a legally enforceable right of oset. Uncertain tax positions are consider ed on an individual basis. Where management considers it probable that an additional outﬂow will r esult from any given position, a provision is made. Such pr ovisions ar e measured using management’s best estimate of the most likely outcome. Further details ar e given in note 5. Deferred tax is pr ovided in full on tempor ary dierences arising between the tax bases of assets and liabilities and their carrying amounts in the Group ﬁnancial statements. Deferr ed tax is not recognised on taxable temporary dier ences arising on the initial recognition of goodwill. Deferred tax is not accounted for when it arises fr om the initial recognition of an asset or liability in a transaction, other than a business combination, that at the time of the transaction aects neither accounting nor taxable proﬁt or loss. Deferr ed tax assets and liabilities are calculated at the tax rates that ar e expected to apply when the asset is realised or the liability settled, based on the tax r ates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Group oper ates. Deferred tax assets ar e recognised in r espect of tax losses carried forward and other tempor ary dierences, to the extent that it is pr obable that the related tax beneﬁt will be r ealised through futur e taxable proﬁts. Deferred tax is pr ovided on tempor ary dierences arising on inv estments in subsidiaries and associates, except wher e the Group controls the timing of the reversal of the tempor ary dierence and it is probable that the temporary dier ence will not reverse in the foreseeable futur e. Deferred tax assets and liabilities ar e oset where ther e is a legally enforceable right to oset curr ent tax assets and liabilities and where they relate to the same tax authority . (u) Share incentive plans (note 33) The fair value of share incentiv es granted in connection with the Gr oup’s equity-settled, share-based employ ee incentive plans is recognised as an expense on a straight -line basis over the vesting period. F air value is measured using whichever of the Black -Scholes model, Monte Carlo model or closing market price is most appropriate. The Group takes into account the best estimate of the number of awards and options expected to vest and revises such estimates at each balance sheet date. Non-market performance conditions ar e included in the vesting estimates. Mark et-based performance conditions ar e included in the fair value measurement but ar e not revised for actual performance. (v) Contingent consideration The initially recor ded cost of any acquisition includes a r easonable estimate of the fair value of any contingent amounts expected to be payable in the future. Any cost or beneﬁt arising when such estimates are revised is r ecognised in the Group income statement (note 14). Where part or all of the amount of disposal consider ation is contingent on future events, the disposal proceeds initially recorded include a reasonable estimate of the value of the contingent amounts e xpected to be receivable and pa yable in the future. The proceeds and proﬁt or loss on disposal are adjusted when r evised estimates are made, with corresponding adjustments made to r eceivables and payables as appropriate, until the ultimate outcome is known and the related consideration r eceived. (w) Discontinued operations (note 17) A discontinued operation is a component of the Gr oup’s business that repr esents a separate geogr aphic area of operation or a separ ate major line of business. Classiﬁc ation as a discontinued operation occur s upon disposal or earlier , if the oper ation meets the criteria to be classiﬁed as held-for-sale. Discontinued operations are pr esented in the Group income statement as a separate line and ar e shown net of tax. When an operation is classiﬁed as a discontinued oper ation, comparatives in the Group income statement and the Gr oup statement of comprehensive income ar e re-pr esented as if the oper ation had been discontinued from the start of the compar ator year . (x) Earnings per share (EPS) (note 18) Earnings per share ar e reported in accor dance with IAS 33. (y) Segment information policy and presentation principles (note 9) We ar e organised into, and managed on a worldwide basis thr ough, the following ﬁve oper ating segments, which ar e based on geogr aphic areas and supported by central functions: North America Latin America UK and Ireland Europe, Middle East and Africa (EMEA) and Asia Paciﬁc. The chief operating decision mak er assesses the performance of these operating segments on the basis of Benchmark EBIT , as deﬁned in note 6. The ‘All other segments’ category r equired to be disclosed has been captioned as EMEA/Asia P aciﬁc in these ﬁnancial statements. This combines information in respect of the EMEA and Asia P aciﬁc segments, as neither of these operating segments is individually r eportable, on the basis of their share of the Gr oup’s revenue, reported proﬁt or loss, and assets. We separ ately present information equivalent to segment disclosures in respect of the costs of our centr al functions, under the caption ‘Centr al Activities’ , as management believes that this information is helpful to users of the ﬁnancial statements. Costs reported for Centr al Activities include costs arising from ﬁnance, treasury and other global functions. 159 Experian plc Annual Report 2021 Financial statements 4. Signiﬁc ant acc ounting policies continued Inter-segment tr ansactions are enter ed into under the normal commercial terms and conditions that would be av ailable to third parties. Such transactions do not ha ve a material impact on the Group’s r esults. Segment assets consist primarily of property , plant and equipment, intangible assets including goodwill, deriv atives designated as hedges of future commer cial transactions, contract assets and receiv ables. They exclude tax assets, c ash and cash equivalents, and derivatives designated as hedges of borrowings. Segment liabilities comprise operating and contract liabilities, including derivatives designated as hedges of future commercial tr ansactions. They exclude tax liabilities, borrowings and related hedging derivativ es. Net assets r eported for Centr al Activities comprise corporate head oce assets and liabilities, including certain post-employment beneﬁt assets and obligations, and derivative assets and liabilities. Capital expenditur e comprises additions to property , plant and equipment and intangible assets, other than additions thr ough business combinations or to right-of-use assets. Information requir ed to be presented also includes analy sis of the Group’s revenues by gr oups of service lines. This is supplemented by voluntary disclosure of the pr oﬁtability of those groups of service lines. For ease of refer ence, we use the term ‘business segments’ when discussing the results of gr oups of service lines. Our two business segments, details of which are given in the Str ategic report section of this Annual Report, ar e: Business-to-Business Consumer Services. The North America, Latin America and the UK and Ir eland operating segments derive revenues fr om both of the Group’s business segments. The EMEA and Asia Paciﬁc segments curr ently do not derive revenue from the Consumer Services business segment. Reportable segment information for the full year pr ovided to the chief operating decision mak er is set out in note 9(a). 5. Critic al acc ounting estimates, assumptions and judgments (a) Critical accounting estimates and assumptions In preparing these ﬁnancial statements, management is requir ed to make estimates and assumptions that aect the reported amount of r evenues, expenses, assets, liabilities and the disclosure of contingent liabilities. The resulting accounting estimates, which are based on management’s best judgment at the date of these ﬁnancial statements, will seldom equal the subsequent actual amounts. The estimates and assumptions that have a signiﬁcant risk of causing a material adjustment to the c arrying amounts of assets and liabilities within the next ﬁnancial year are summarised below . Revenue r ecognition is excluded from this summary on the grounds that the policy adopted in this ar ea is suciently objective. T ax (notes 16, 36 and 43(a)) The Group is subject to tax in numer ous jurisdictions. The Group has a number of open tax returns with various tax authorities with whom it is in active dialogue. Liabilities r elating to these open and judgmental matters are based on an assessment as to whether additional taxes will be due, after taking into account external advice where appr opriate. Signiﬁc ant judgment is requir ed in determining the related assets or pr ovisions, as there ar e transactions in the or dinary course of business and calculations for which the ultimate tax determination is uncertain. The Group recognises liabilities based on estimates of whether additional tax will be due. Where the ﬁnal tax outcome of these matter s is dierent fr om the amounts that were initially r ecognised, the dierences will aect the results for the year and the r espective income tax and deferred tax assets or provisions in the year in which such determination is made. The Group recognises deferr ed tax assets based on forec asts of future pr oﬁts against which those assets may be utilised. Goodwill (note 20) The Group tests goodwill for impairment annually , or more fr equently if there is an indic ation that it may be impaired. The r ecover able amount of each CGU is generally determined on the basis of v alue-in-use calculations, which requir e the use of cash ﬂow pr ojections based on ﬁnancial budgets, looking forwar d up to ﬁve years. Management determines budgeted proﬁt mar gin based on past performance and its expectations for the market’s development. Cash ﬂows ar e extrapolated using estimated growth r ates beyond a ﬁve-year period. The growth r ates used do not exceed the long-term aver age growth r ate for the CGU’s markets. The discount r ates used reﬂect the Gr oup’s pre-tax weighted aver age cost of capital (W ACC), as adjusted for region speciﬁc risks and other factors. (b) Critical judgments In applying the Group’s accounting policies, management has made judgments that have a signiﬁcant eect on the amounts r ecognised in the Group ﬁnancial statements and the r eported amounts of assets, liabilities, income and expenses. Actual r esults may dier from these estimates. Estimates and underlying assumptions are r eviewed on an ongoing basis. Revisions to estimates are r ecognised prospectively . The most signiﬁcant of these judgments ar e in respect of intangible assets and contingencies: Intangible assets Certain costs incurred in the developmental phase of an internal pr oject, which include the development of databases, internal use softwar e and internally generated softwar e, are capitalised as intangible assets if a number of criteria are met. Management has made judgments and assumptions when assessing whether a project meets these criteria, and on measuring the costs and the economic life attributed to such projects. On acquisition, speciﬁc intangible assets ar e identiﬁed and recognised separately fr om goodwill and then amortised over their estimated useful lives. These include items such as brand names and customer lists, to which value is ﬁrst attributed at the time of acquisition. The c apitalisation of these assets and the related amortisation char ges are based on judgments about the value and economic life of such items. The economic lives of intangible assets are estimated at between thr ee and ten years for internal pr ojects and between two and 20 years for acquisition intangibles. Amortisation methods, useful lives and residual values are r eviewed at each reporting date and adjusted if appropriate. Further details of the amounts of , and movements in, such assets are given in note 21. Contingencies In the case of pending and thr eatened litigation claims, management has formed a judgment as to the likelihood of ultimate liability . No liability has been recognised wher e the likelihood of any loss arising is possible r ather than probable. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 160 6. Use of non-G AAP measures in the Group ﬁnancial statements As detailed below , the Group has identiﬁed and deﬁned certain measur es that it uses to understand and manage its performance. The measur es are not deﬁned under IFRS and they may not be dir ectly compar able with other companies’ adjusted performance measures. These non-GAAP measures ar e not intended to be a substitute for any IFRS measur es of performance but management has included them as they consider them to be key measures used within the business f or assessing the underlying performance of the Group’s ongoing businesses. (a) Benchmark proﬁt before tax (Benchmark PBT) (note 9(a)(i)) Benchmark PBT is disclosed to indicate the Gr oup’s underlying proﬁtability . It is deﬁned as proﬁt befor e amortisation and impairment of acquisition intangibles, impairment of goodwill, acquisition expenses, adjustments to contingent consideration, Exceptional items, ﬁnancing fair value remeasur ements, tax (and interest ther eon) and discontinued operations. It includes the Group’s share of continuing associates’ Benchmark post-tax r esults. An explanation of the basis on which we report Exceptional items is provided below . Other adjustments made to derive Benchmark PBT are explained as follows: Charges for the amortisation and impairment of acquisition intangibles are excluded fr om the calculation of Benchmark PBT because these charges ar e based on judgments about their value and economic life and bear no relation to the Gr oup’s underlying ongoing performance. Impairment of goodwill is similarly excluded from the c alculation of Benchmark PBT . Acquisition and disposal expenses (repr esenting the incidental costs of acquisitions and disposals, one-time integr ation costs and other corporate tr ansaction expenses) relating to successful, active or aborted acquisitions and disposals are excluded fr om the deﬁnition of Benchmark PBT as they bear no r elation to the Group’s underlying ongoing performance or to the performance of any acquir ed businesses. Adjustments to contingent consider ation are similarly excluded from the deﬁnition of Benchmark PBT . Charges and cr edits for ﬁnancing fair value r emeasurements within ﬁnance expense in the Group income statement ar e excluded from the deﬁnition of Benchmark PBT . These include retranslation of intr a-Group funding, and that element of the Gr oup’s derivatives that is ineligible for hedge accounting, together with gains and losses on put options in respect of acquisitions. Amounts recognised gener ally arise from market movements and accor dingly bear no direct r elation to the Group’s underlying performance. (b) Benchmark earnings before interest and tax (Benchmark EBIT) and margin (Benchmark EBIT mar gin) (note 9(a)(i)) Benchmark EBIT is deﬁned as Benchmark PBT befor e the net interest expense charged ther ein and accordingly ex cludes Exceptional items as deﬁned below . Benchmark EBIT mar gin is Benchmark EBIT fr om ongoing activities expressed as a per centage of revenue fr om ongoing activities. (c) Benchmark earnings before interest, tax, depr eciation and amortisation (Benchmark EBITDA) Benchmark EBITDA is deﬁned as Benchmark EBIT befor e the depreciation and amortisation charged ther ein (note 12). (d) Exited business activities Exited business activities are businesses sold, closed or identiﬁed for closure during a ﬁnancial year . These are treated as exited business activities for both revenue and Benchmark EBIT purposes. The results of exited business activities are disclosed separ ately with the results of the prior period re-pr esented in the segmental analyses as appr opriate. This measure diers fr om the deﬁnition of discontinued operations in IFRS 5. (e) Ongoing activities The results of businesses tr ading at 31 March 2021, which ar e not disclosed as exited business activities, ar e reported as ongoing activities. (f) Constant exchange r ates T o highlight our organic performance, we discuss our results in terms of growth at constant exchange r ates, unless otherwise stated. This repr esents growth c alculated after translating both y ears’ performance at the prior year’s average exchange r ates. (g) T otal gr owth (note 9(a)(ii)) This is the year-on- year change in the performance of our activities at actual exchange rates. T otal growth at constant exchange r ates remov es the translational for eign exchange eects arising on the consolidation of our activities and comprises one of our measures of performance at constant exchange rates. (h) Organic revenue gr owth (note 9(a)(ii)) This is the year-on- year change in the r evenue of ongoing activities, translated at constant exchange r ates, excluding acquisitions until the ﬁrst anniversary of their consolidation. (i) Benchmark earnings and T otal Benchmark earnings (note18) Benchmark earnings comprises Benchmark PBT less attributable tax and non-controlling inter ests. The attributable tax for this purpose excludes signiﬁcant tax cr edits and charges arising in the year which, in view of their size or nature, are not compar able with previous years, together with tax arising on Exceptional items and on other adjustments made to derive Benchmark PBT . Benchmark PBT less attributable tax is designated as T otal Benchmark earnings. ( j) Benchmark earnings per shar e (Benchmark EPS) (note 18) Benchmark EPS comprises Benchmark earnings divided by the weighted aver age number of issued ordinary shar es, as adjusted f or own shares held. (k) Benchmark PBT per share Benchmark PBT per share comprises Benchmark PBT divided by the weighted aver age number of issued ordinary shar es, as adjusted f or own shares held. (l) Benchmark tax charge and r ate (note 16(b)(ii)) The Benchmark tax charge is the tax char ge applicable to Benchmark PBT . It diers from the tax charge by tax attributable to Exceptional items and other adjustments made to derive Benchmark PBT , and exceptional tax charges. A reconciliation is pr ovided in note 16(b)(ii) to these ﬁnancial statements. The Benchmark eective rate of tax is c alculated by dividing the Benchmark tax charge by Benchmark PBT . 161 Experian plc Annual Report 2021 Financial statements 6. Use of non-G AAP measures in the Group ﬁnancial statements continued (m) Exceptional items (note 14(a)) The separate r eporting of Exceptional items gives an indication of the Group’s underlying performance. Exceptional items include those arising from the pr oﬁt or loss on disposal of businesses, closur e costs of major business units, costs of signiﬁc ant restructuring pr ogr ammes and other ﬁnancially signiﬁcant one-o items. All other restructuring costs ar e charged against Benchmark EBIT , in the segments in which they are incurred. (n) Ful l-year dividend per shar e (note 19) Full -year dividend per shar e comprises the total of dividends per share announced in respect of the ﬁnancial year . (o) Benchmark operating and Benchmark fr ee cash ﬂow Benchmark operating c ash ﬂow is Benchmark EBIT plus amortisation, depreciation and char ges in respect of shar e-based incentive plans, less capital expenditur e net of disposal proceeds and adjusted for changes in working capital, principal lease payments and the Group’s shar e of the Benchmark proﬁt or loss r etained in continuing associates. Benchmark free c ash ﬂow is derived from Benchmark oper ating cash ﬂow by excluding net interest, tax paid in respect of continuing operations and dividends paid to non-controlling inter ests. (p) Cash ﬂow conversion Cash ﬂow conversion is Benchmark oper ating cash ﬂow expressed as a percentage of Benchmark EBIT . (q) Net debt and Net funding (note 28) Net debt is borrowings (and the fair v alue of derivatives hedging borrowings) excluding lease obligations and accrued inter est , less cash and cash equivalents and other highly liquid bank deposits with original maturities greater than thr ee months. Net funding is borr owings (and the fair value of the eective portion of derivatives hedging borr owings) excluding lease obligations and accrued interest, less cash held in Group T reasury . (r) Return on c apital employed (ROCE) (note 9(a)(iii)) ROCE is deﬁned as Benchmark EBIT less tax at the Benchmark r ate divided by a three-point aver age of capital employed, in continuing operations, over the year . Capital employed is net assets less non-controlling inter ests, further adjusted to add or deduct the net tax liability or asset and to add Net debt. 7. Financial risk management (a) Financial risk factors The Group’s activities expose it to a v ariety of ﬁnancial risks. These are market risk, including foreign exchange risk and inter est rate risk, cr edit risk, and liquidity risk. These risks are unchanged fr om those reported in the 2020 Annual Report. The numeric disclosures in r espect of ﬁnancial risks ar e included within later notes to the ﬁnancial statements, to pr ovide a more tr ansparent link between ﬁnancial risks and results. Financial risks r epresent part of the Gr oup’s risks in r elation to its strategy and business objectives. There is a full discussion of the most signiﬁc ant risks in the Risk management section of this Annual Report. The Gr oup’s ﬁnancial risk management focuses on the unpredictability of ﬁnancial markets and seeks to minimise potentially adver se eects on the Group’s ﬁnancial performance. The Group seek s to reduce its exposur e to ﬁnancial risks and uses derivative ﬁnancial instruments to hedge certain risk exposures. Such derivative ﬁnancial instruments are also used to manage the Group’s borr owings so that amounts are held in curr encies broadly in the same proportion as the Gr oup’s main earnings. Howev er , the Gr oup does not, nor does it curr ently intend to, borrow in the Br azilian real or the Colombian peso. The Group also ensur es surplus funds are prudently managed and controlled. F oreign ex change risk The Group is exposed to for eign exchange risk from future commer cial transactions, recognised assets and liabilities and investments in, and loans between, Gr oup undertakings with dierent functional curr encies. The Group manages such risk, primarily within undertakings whose functional currencies ar e the US dollar , by: entering into forward for eign exchange contracts in the relevant currencies in r espect of investments in entities with functional currencies other than the US dollar , whose net assets are exposed to foreign exchange tr anslation risk; swapping the proceeds of certain bonds issued in pounds sterling and euros into US dollars; managing the liquidity of Group undertakings in the functional curr ency of those undertakings by using an in-house banking structure and hedging any remaining for eign currency exposures with forwar d foreign exchange contr acts; denominating internal loans in relevant curr encies, to match the currencies of assets and liabilities in entities with dier ent functional currencies; and using forward for eign exchange contracts to hedge certain future commercial tr ansactions. The principal transaction exposur es are to the pound sterling and the euro. An indication of the sensitivity to for eign exchange risk is given in note 10. Interest rate risk The Group’s inter est rate risk arises principall y from components of its Net debt that are at variable r ates. The Group has a policy of normally maintaining between 50% and 100% of Net funding at rates that ar e ﬁxed for more than six months. The Gr oup manages its interest r ate exposure by: using ﬁxed and ﬂoating rate borr owings, interest r ate swaps and cross-curr ency interest r ate swaps to adjust the balance between the two; and mixing the duration of borr owings and interest r ate swaps to smooth the impact of interest r ate ﬂuctuations. Further information in r espect of the Group’s net ﬁnance costs for the year and an indication of the sensitivity to inter est rate risk is giv en in note15. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 162 7. Financial risk management c ontinued Credit risk In the case of derivative ﬁnancial instruments, deposits, contract assets and trade r eceivables, the Group is exposed to cr edit risk from the non-performance of contractual agr eements by the contracted party . Credit risk is managed by: only entering into contracts for deriv ative ﬁnancial instruments and deposits with banks and ﬁnancial institutions with str ong credit r atings, within limits set for each organisation; and closely controlling dealing activity and r egularly monitoring counterparty positions. The credit risk on derivativ e ﬁnancial instruments utilised and deposits held by the Group is ther efore not consider ed to be signiﬁcant. The Gr oup does not anticipate that any losses will arise from non-perf ormance by its chosen counterparties. F urther information on the Group’s derivative ﬁnancial instruments at the balance sheet dates is given in note 30 and that in respect of amounts r ecognised in the Group income statement is given in note 15. F urther information on the Group’s cash and cash equivalents at the balance sheet dates is given in note 25. T o minimise credit risk for tr ade receivables, the Gr oup has implemented policies that requir e appropriate cr edit checks on potential clients befor e granting cr edit . The maximum credit risk in respect of such ﬁnancial assets is their carrying value. Further information in respect of the Group’s tr ade receivables is given in note 24. Debt investments All of the Group’s debt investments at amortised cost and FV OCI are considered to have low cr edit risk; the loss allowance is therefore limited to 12 months’ expected losses. Management consider s ‘low credit risk’ for listed bonds to be an investment-gr ade credit rating with at least one major rating agency . Other instruments are consider ed to be low credit risk when they have a low risk of default and the issuer has a high capacity to meet its contr actual cash ﬂow obligations in the near term. Financial assets at FVPL The Group is also exposed to cr edit risk in relation to debt in vestments that are measur ed at FVPL. The maximum exposur e at the balance sheet date is the carrying amount of these investments. Liquidity risk The Group manages liquidity risk by: issuing long-maturity bonds and notes; entering into long-term committed bank borrowing facilities, to ensure the Group has sucient funds av ailable for operations and planned growth; spre ading th e matur it y dates of i ts de bt ; and monitoring rolling cash ﬂo w forec asts, to ensur e the Group has adequate, unutilised committed bank borr owing facilities. Details of such facilities are given in note 27. A maturity analysis of contractual undiscounted futur e cash ﬂows for ﬁnancial liabilities is provided in note 32. (b) Capital risk management The Group’s deﬁnition and management of c apital focuses on capital employed: The Group’s capital employ ed is reported in the net assets summary table set out in the Financial review and analysed b y segment in note 9(a)(iii). As part of its internal reporting pr ocesses, the Gr oup monitors capital employed by oper ating segment. The Group’s objectives in managing c apital are to: safeguard its ability to continue as a going concern, in order to provide returns for shar eholders and beneﬁts for other stakeholder s; and maintain an optimal capital structure and cost of c apital. The Group’s policy is to have: a prudent but ecient balance sheet; and a target lever age r atio of 2.0 to 2.5 times Benchmark EBITDA, consistent with the intention to retain str ong investment-gr ade credit ratings. T o maintain or adjust its capital structure, the Group may: adjust the amount of dividends paid to shareholders; return capital to shar eholders; issue or purchase our own shar es; or sell assets to reduce Net debt. Dividend policy The Group has a pr ogressive dividend policy which aims to incr ease the dividend over time broadly in line with the underlying gr owth in Benchmark EPS. This aligns shareholder r eturns with the underlying proﬁtability of the Gr oup. In determining the level of dividend in an y one year , in accor dance with the policy , the Boar d also considers a number of other factors, including the outlook for the Group, the opportunities for organic investment, the opportunities to make acquisitions and disposals, the cash ﬂow gener ated by the Group, and the level of dividend cover . Further detail on the distributable r eserves of the Company can be found in note K to the Company ﬁnancial statements. 163 Experian plc Annual Report 2021 Financial statements 8. R evenue (a) Disaggregation of rev enue from contr acts with customers Y ear ended 31 March 2021 North America US$m Latin America US$m UK and Ireland US$m EMEA/ Asia Paciﬁc US$m T otal operating segments US$m Revenue from e xternal customers Data 1,761 457 361 287 2,866 Decisioning 694 92 220 178 1,184 Business-to-Business 2,455 549 581 465 4,050 Consumer Services 1,075 76 156 — 1,307 T otal ongoing activities 3,530 625 737 465 5,357 Y ear ended 31 March 2020  North America US$m Latin America US$m UK and Ireland US$m EMEA/ Asia Paciﬁc US$m T otal operating segments US$m Revenue from external customer s Data 1,642 578 367 213 2,800 Decisioning 679 114 227 214 1,234 Business-to-Business 2,321 692 594 427 4,034 Consumer Services 926 40 161 — 1,127 T otal ongoing activities 3,247 732 755 427 5,161 1 Revenue for the year ended 31 March 2020 has been r e-presented for the r eclassiﬁcation to exited business activities of certain B2B businesses and the reclassiﬁc ation of our Consumer Services business in Latin America to the Consumer Services business segment; previously our Consumer Services business in this r egion was not suciently material to be disclosed separately . T otal revenue comprises r evenue from ongoing activities as well as r evenue from exited business activities and is reconciled in note 9. Revenue in respect of exited business activities of US$15m (2020: US$18m) comprised UK and Ir eland Data revenue of US$12m (2020: US$14m) and EMEA/Asia Paciﬁc Decisioning r evenue of US$3m (2020: US$4m). Data is predominantly tr ansactional revenue with a portion from licence fees. Decisioning revenue is derived fr om: software and system sales, and includes recurring licence fees, consultancy and implementation fees, and transactional charges; credit scor e fees which are primarily tr ansactional; and analytics income comprising a mix of consultancy and professional fees as well as tr ansactional revenue. Consumer Services revenue primarily comprises monthly subscription and one-o fees, and referral f ees for credit pr oducts and white-label partnerships. The timing of recognition of these r evenue streams is discussed in note 4(q). (b) Signiﬁcant changes in contr act balances Contract assets pr edominantly relate to software licence services, where r evenue recognition for on-pr emise arrangements occurs as the solution is transferr ed to the customer , whereas the invoicing pattern is often annually o ver the contract period. Contract assets recognised during the year totalled US$62m (2020: US$107m). The contract asset balance for work completed but not in voiced on satisfaction of a performance obligation unwinds over the contract term. Contract assets are tr ansferr ed to receivables when the right to consider ation becomes unconditional, or conditional only on the passage of time. Contr act assets reclassiﬁed to receivables during the year total led US$79m (2020: US$58m). An impairment char ge of US$4m (2020: US$nil) has been recognised against contr act assets during the year . The majority of software licences ar e invoiced annually in advance. Where these licences r elate to Experian-hosted solutions, r evenue is recognised o ver the period that the service is available to the customer , creating a contr act liability . Delivery services ar e generally invoiced during the delivery period, creating a contr act liability for the consideration received in advance, until the delivery is complete. Wher e the delivery relates to Experian-hosted solutions, r evenue is recognised o ver the period that the service is available to the customer , reducing the contr act liability over time. Wher e the delivery relates to an on-pr emise solution, the contr act liability is released on delivery completion. Support and maintenance agr eements are often in voiced annually in advance, creating a contr act liability , which is r eleased over the term of the maintenance period as revenue is recognised. Revenue recognised in the y ear of US$352m (2020: US$370m) was included in the opening contract liability . Cash received in adv ance not recognised as revenue in the year was US$380m (2020: US$377m). The increase in contr act liabilities resulting fr om business combinations during the year was US$8m (2020: US$7m). F oreign exchange accounts for US$8m and US$21m of the incr ease in contract asset and contract liability balances in the year r espectively (2020: decrease of US$8m and US$23m). Notes to the Group ﬁnancial statements continued Experian plc Financial statements 164 8. R evenue c ontinued (c) Contract costs The carrying amount of assets r ecognised from costs to obtain and costs to fulﬁl contr acts with customers at 31 Mar ch 2021 is US$25m and US$74m respectively (2020: US$28m and US$68m). Amortisation of contract costs in the y ear is US$66m (2020: US$74m) and recognised impairment losses totalled US$2m (2020: US$5m). Contract costs ar e amortised on a systematic basis consistent with the pattern of transfer of the related goods or services. A portfolio approach has been applied to calculate contr act costs for contr acts with similar characteristics, where the Group reasonabl y expects that the eects of applying a portfolio approach does not dier materially fr om calculating the amounts at an individual contract level. (d) T ransaction price alloc ated to remaining performance obligations The aggregate amount of the tr ansaction price from non-cancellable contracts with customer s with expected durations of 12 months or mor e, allocated to the performance obligations that are unsatisﬁed, or partially satisﬁed, at 31 March 2021 is US$5.0bn (2020: US$4.6bn). W e expect to recognise approximatel y 42% (2020: 43%) of this value within one year , 28% (2020: 25%) within one to two years, 17% (2020: 15%) within two to three y ears and 13% (2020: 17%) thereafter . The aggregate amount of the tr ansaction price allocated to unsatisﬁed, or partially satisﬁed, performance obligations which are tr ansactional in nature includes estimates of variable consider ation. These estimates are based on for ecast tr ansactional volumes and do not take into account all external market factors which may have an impact on the futur e revenue recognised from such contr acts. A portfolio approach has been applied to c alculate the aggregate amount of the tr ansaction price allocated to the unsatisﬁed, or partially satisﬁed, performance obligations for contr acts with similar characteristics, where the Group reasonabl y expects that the eects of applying a portfolio approach does not dier materially from c alculating the amounts at an individual contract level. We apply the pr actical expedient in paragr aph 121(a) of IFRS 15 and do not disclose information about r emaining performance obligations that have original expected durations of one y ear or less. This excludes contr acts across a number of business units which have r evenue due to be recognised in the ﬁnancial year ending 31 March 2022; it also ex cludes the majority of our direct -to-consumer arrangements. 9. Segment information (a) IFRS 8 disclosures (i) Income statement Y ear ended 31 March 2021 North America US$m Latin America US$m UK and Ireland US$m EMEA/ Asia Paciﬁc US$m T otal operating segments US$m Central Activities US$m T otal continuing operations US$m Revenue from e xternal customers Ongoing activities 3,530 625 737 465 5,357 — 5,357 Exited business activities — — 12 3 15 — 15 T otal 3,530 625 749 468 5,372 — 5,372 Reconciliation from Benchmark EBIT to proﬁt/(loss) before tax Benchmark EBIT Ongoing activities 1,201 172 122 (20) 1,475 (90) 1,385 Exited business activities — — (1) 2 1 — 1 T otal 1,201 172 121 (18) 1,476 (90) 1,386 Net interest expense included in Benchmark PBT (note 15(b)) (5) (2) (1) (2) (10) (111) (121) Benchmark PBT 1,196 170 120 (20) 1,466 (201) 1,265 Exceptional items (note 14(a)) 112 (1) (63) (13) 35 — 35 Impairment of goodwill (note 20) — — — (53) (53) — (53) Amortisation of acquisition intangibles (note 21) (90) (14) (7) (27) (138) — (138) Acquisition and disposal expenses (16) (4) (1) (20) (41) — (41) Adjustment to the fair value of contingent consider ation — — — (1) (1) — (1) Non-benchmark share of post -tax (loss)/proﬁt of associates — — (3) — (3) 19 16 Interest on uncertain tax pr ovisions — — — — — (11) (11) Financing fair value remeasur ements (note 15(c)) — — — — — 5 5 Proﬁt/(loss) before tax 1,202 151 46 (134) 1,265 (188) 1,077 165 Experian plc Annual Report 2021 Financial statements 9. Segment information c ontinued (i) Income statement continued Y ear ended 31 March 2020 1 North America US$m Latin America US$m UK and Ireland US$m EMEA/ Asia Paciﬁc US$m T otal operating segments US$m Central Activities US$m T otal continuing operations US$m Revenue from external customer s Ongoing activities 3,247 732 755 427 5,161 — 5,161 Exited business activities — — 14 4 18 — 18 T otal 3,247 732 769 431 5,179 — 5,179 Reconciliation from Benchmark EBIT to proﬁt/(loss) befor e tax Benchmark EBIT Ongoing activities 1,093 220 173 12 1,498 (112) 1,386 Exited business activities — — (2) 3 1 — 1 T otal 1,093 220 171 15 1,499 (112) 1,387 Net interest expense included in Benchmark PBT (note 15(b)) (5) (2) (1) (2) (10) (122) (132) Benchmark PBT 1,088 218 170 13 1,489 (234) 1,255 Exceptional items (note 14(a)) (35) — — — (35) — (35) Amortisation of acquisition intangibles (note 21) (85) (17) (8) (14) (124) — (124) Acquisition and disposal expenses (9) (2) (8) (20) (39) — (39) Adjustment to the fair value of contingent consider ation (1) — 5 — 4 — 4 Non-benchmark share of post -tax proﬁt of associates — — — — — 6 6 Interest on uncertain tax pr ovisions — — — — — (14) (14) Financing fair value remeasur ements (note 15(c)) — — — — — (111) (111) Proﬁt/(loss) befor e tax 958 199 159 (21) 1,295 (353) 942 1 Revenue and Benchmark EBIT for the year ended 31 Mar ch 2020 have been re-pr esented for the reclassiﬁcation to exited business activities of certain B2B businesses. Additional information by oper ating segment, including that on total and or ganic growth at constant ex change rates, is provided in the Strategic r eport. (ii) Reconciliation of revenue fr om ongoing activities North America US$m Latin America US$m UK and Ireland US$m EMEA/ Asia Paciﬁc US$m T otal ongoing activities US$m Revenue for the year ended 31 Mar ch 2020 1 3,247 732 755 427 5,161 Adjustment to constant exchange rates — 1 (2) 1 — Revenue at constant ex change rates for the year ended 31 Mar ch 2020 3,247 733 753 428 5,161 Organic r evenue growth 241 65 (43) (60) 203 Revenue from acquisitions 42 4 — 89 135 Revenue at constant ex change rates for the year ended 31 Mar ch 2021 3,530 802 710 457 5,499 Adjustment to actual exchange rates — (177) 27 8 (142) Revenue for the year ended 31 Mar ch 2021 3,530 625 737 465 5,357 Organic r evenue growth at constant exchange r ates 7% 9% (6)% (14)% 4% Revenue growth at constant e xchange rates 9% 9% (6)% 7% 7% 1 Revenue for the year ended 31 March 2020 has been re-pr esented for the reclassiﬁcation to e xited business activities of certain B2B businesses. The table above demonstr ates the application of the methodology set out in note 6 in determining organic and total r evenue growth at constant exchange rates. Revenue at constant exchange rates is r eported for both years using the av erage exchange r ates applicable for the year ended 31March2020. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 166 9. Segment information c ontinued (iii) Balance sheet Net assets/(liabilities) At 31 March 2021 North America US$m Latin America US$m UK and Ireland US$m EMEA/ Asia Paciﬁc US$m T otal operating segments US$m Central Activities and other US$m T otal Group US$m Goodwill 3,133 611 718 799 5,261 — 5,261 Investments in associates 4 — 61 9 74 54 128 Other assets 1,969 495 503 715 3,682 1,000 4,682 T otal assets 5,106 1,106 1,282 1,523 9,017 1,054 10,071 T otal liabilities (994) (210) (345) (494) (2,043) (4,909) (6,952) Net assets/(liabilities) 4,112 896 937 1,029 6,974 (3,855) 3,119 At 31 March 2020 North America US$m Latin America US$m UK and Ireland US$m EMEA/ Asia Paciﬁc US$m T otal operating segments US$m Central Activities and other US$m T otal Group US$m Goodwill 2,943 530 656 414 4,543 — 4,543 Investments in associates 22 — 58 7 87 36 123 Other assets 1,816 446 519 476 3,257 976 4,233 T otal assets 4,781 976 1,233 897 7,887 1,012 8,899 T otal liabilities (1,010) (165) (320) (228) (1,723) (4,895) (6,618) Net assets/(liabilities) 3,771 811 913 669 6,164 (3,883) 2,281 Central Activities and other comprises: 2021 2020 Assets US$m Liabilities US$m Net assets/ (liabilities) US$m Assets US$m Liabilities US$m Net assets/ (liabilities) US$m Central Activities 583 (249) 334 512 (241) 271 Investments in associates 54 — 54 36 — 36 Net debt 297 (4,123) (3,826) 329 (4,227) (3,898) Ta x 120 (537) (417) 135 (427) (292) 1,054 (4,909) (3,855) 1,012 (4,895) (3,883) Capital employed 2021 US$m 2020 US$m North America 4,112 3,771 Latin America 896 811 UK and Ireland 937 913 EMEA/Asia Paciﬁc 1,029 669 T otal operating segments 6,974 6,164 Central Activities 388 307 Non-controlling inter ests (38) (6) Capital employed attributable to owners 7,324 6,465 The three-point aver age capital employed ﬁgure of US$6,849m, used in our calculation of ROCE, is determined by calculating the mathematical aver age of capital employed at 31 Mar ch 2021, 30 September 2020 and 31 March 2020. 167 Experian plc Annual Report 2021 Financial statements 9. Segment information c ontinued (iv) Capital expenditure, amortisation and depreciation Capital expenditure Right-of-use asset additions Amortisation Depreciation 2021 US$m 2020 US$m 2021 US$m 2020 US$m 2021 US$m 2020 US$m 2021 US$m 2020 US$m North America 211 222 26 15 160 134 59 60 Latin America 81 107 3 17 61 70 17 19 UK and Ireland 41 60 14 9 50 42 28 25 EMEA/Asia Paciﬁc 28 34 14 9 27 22 22 21 T otal operating segments 361 423 57 50 298 268 126 125 Central Activities 61 64 — — 28 19 1 1 T otal Group 422 487 57 50 326 287 127 126 Amortisation and depreciation above only include amounts char ged to Benchmark PBT . (v) Revenue by country – continuing oper ations 2021 US$m 2020 (Re-presented) US$m USA 3,529 3,245 UK 744 762 Brazil 546 647 Germany 81 8 Colombia 60 66 South Africa 55 62 Other 357 389 5,372 5,179 Revenue is primarily attributable to countries other than Ir eland. No single client accounted for 10% or mor e of revenue in the current or prior year . Revenue from the US A, the UK and Br azil in aggregate comprises 90% (2020: 90%) of Gr oup revenue. Revenue attributable to Germany was pr eviously reported within Other; follo wing the acquisition in the year of the Risk Management division of Arvato Financial Solutions (AFS) (see note 41) this is now analysed separ ately , and consequently compar ative information has been re-presented. (vi) Non-current assets by country 2021 US$m 2020 (Re-presented) US$m USA 4,437 4,159 UK 1,079 1,042 Brazil 731 627 Germany 477 5 South Africa 268 249 Colombia 164 155 Other 703 603 Segment non-current assets by country 7,859 6,840 Central Activities 695 552 Deferred tax 86 107 8,640 7,499 T o add clarity to the presentation of this information, non-current assets for Central Activities and deferr ed tax have been excluded from the analysis by country . The Gr oup has no signiﬁcant non-curr ent assets located in Ir eland. Non-current assets in Germany wer e previously reported within Other; following the acquisition of the Risk Management division of Arvato Financial Solutions (AFS) in the year (note 41) they are now anal ysed separ ately , and consequently compar ative information has been r e-presented. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 168 9. Segment information c ontinued (b) Information on business segments (including non-GAAP disclosur es) Y ear ended 31 March 2021 Business-to- Business US$m Consumer Services US$m T otal business segments US$m Central Activities US$m T otal continuing operations US$m Revenue from e xternal customers Ongoing activities 4,050 1,307 5,357 — 5,357 Exited business activities 15 — 15 — 15 T otal 4,065 1,307 5,372 — 5,372 Reconciliation from Benchmark EBIT to proﬁt/(loss) before tax Benchmark EBIT Ongoing activities 1,192 283 1,475 (90) 1,385 Exited business activities 1 — 1 — 1 T otal 1,193 283 1,476 (90) 1,386 Net interest expense included in Benchmark PBT (note 15(b)) (8) (2) (10) (111) (121) Benchmark PBT 1,185 281 1,466 (201) 1,265 Exceptional items (note 14(a)) 35 — 35 — 35 Impairment of goodwill (note 20) (53) — (53) — (53) Amortisation of acquisition intangibles (note 21) (118) (20) (138) — (138) Acquisition and disposal expenses (40) (1) (41) — (41) Adjustment to the fair value of contingent consider ation (1) — (1) — (1) Non-benchmark share of post -tax (loss)/proﬁt of associates — (3) (3) 19 16 Interest on uncertain tax pr ovisions — — — (11) (11) Financing fair value remeasur ements (note 15(c)) — — — 5 5 Proﬁt/(loss) before tax 1,008 257 1,265 (188) 1,077 Y ear ended 31 March 2020 1 Business-to- Business US$m Consumer Services US$m T otal business segments US$m Central Activities US$m T otal continuing operations US$m Revenue from external customer s Ongoing activities 4,034 1,127 5,161 — 5,161 Exited business activities 18 — 18 — 18 T otal 4,052 1,127 5,179 — 5,179 Reconciliation from Benchmark EBIT to proﬁt/(loss) befor e tax Benchmark EBIT Ongoing activities 1,251 247 1,498 (112) 1,386 Exited business activities 1 — 1 — 1 T otal 1,252 247 1,499 (112) 1,387 Net interest expense included in Benchmark PBT (note 15(b)) (8) (2) (10) (122) (132) Benchmark PBT 1,244 245 1,489 (234) 1,255 Exceptional items (note 14(a)) (35) — (35) — (35) Amortisation of acquisition intangibles (note 21) (103) (21) (124) — (124) Acquisition and disposal expenses (37) (2) (39) — (39) Adjustment to the fair value of contingent consider ation 4 — 4 — 4 Non-benchmark share of post -tax proﬁt of associates — — — 6 6 Interest on uncertain tax pr ovisions — — — (14) (14) Financing fair value remeasur ements (note 15(c)) — — — (111) (111) Proﬁt/(loss) befor e tax 1,073 222 1,295 (353) 942 1 Revenue of US$40m and Benchmark EBIT of US$(10)m for the year ended 31 March 2020 have been r e-presented for the r eclassiﬁcation of our Consumer Services business in Latin America to the Consumer Services business segment; previously our Consumer Services business in this region was not sucientl y material to be disclosed separately . In addition, r evenue and Benchmark EBIT have been re-pr esented for the reclassiﬁcation to exited business activities of certain B2B businesses. Additional information by business segment, including that on total and or ganic growth at constant exchange rates, is provided in the Strategic r eport. 169 Experian plc Annual Report 2021 Financial statements 10. F oreign curr ency (a) Principal exchange r ates used A verage Closing 2021 2020 2021 2020 2019 US dollar : Brazilian r eal 5.41 4.12 5.74 5.20 3.89 Pound sterling : US dollar 1.31 1.27 1.38 1.24 1.31 Euro : US dollar 1.17 1.11 1.17 1.09 1.12 US dollar : Colombian peso 3,699 3,382 3,720 4,052 3,163 US dollar : South African r and 16.36 14.79 14.76 17.81 14.47 (b) F oreign exchange risk (i) Brazilian real intr a-Group funding Brazilian r eal intra-Group funding pr ovided to Serasa S.A., from a Gr oup company whose functional currency is not the Brazilian r eal, is not consider ed permanent and foreign exchange gains or losses on this funding ar e recognised in the Group income statement. As a result of the weakening of 10% in the Br azilian real against the US dollar in the year ended 31 March 2021, a charge of US$16m has been recognised within ﬁnancing fair value r emeasurements (2020: US$54m charge due to 34% weakening) (note 15(c)). The Group is similarly exposed to the impact of the Br azilian real strengthening or weakening against the US dollar in the futur e. A mo vement of 20% would result in a US$37m impact on pr oﬁt before tax. There is no eect on total equity as a result of this exposur e, since it arises on intra-Gr oup funding and there would be a r elated equal but opposite foreign ex change movement recognised in the tr anslation reserve within equity . (ii) Other exposures On the basis of the proﬁle of for eign exchange exposur es, and an assessment of r easonably possible changes in such exposur es, ther e are no other material sensitivities to foreign exchange risk at the balance sheet dates. In making these assessments, actual data on movements in the principal currencies over the most r ecent three-year period has been considered together with exposur es at the balance sheet dates. This methodology has been applied consistently . 11. Labour c osts and employee numbers – c ontinuing oper ations (a) Labour costs (including executive dir ectors) Notes 2021 US$m 2020 US$m Wages and salaries 1,446 1,353 Social security costs 217 218 Share incentive plans 33(a) 111 88 Pension costs – deﬁned beneﬁt plans 35(a) 6 8 Pension costs – deﬁned contribution plans 58 56 Employee beneﬁt costs 1,838 1,723 Other labour costs 157 149 1,995 1,872 W ages and salaries include redundancy costs of US$28m (note 14(c)). Other labour costs includes those in respect of external contr actors, outsourcing and the recruitment, development and tr aining of employees. The deﬁnition of key management personnel, and an analysis of their remuner ation, is given in note 44(d). (b) A verage monthly number of employees (including e xecutive dir ectors) 2021 2020 Full-time Part-time Full-time- equivalent Full-time Part-time Full -time- equivalent North America 6,992 49 7,016 6,620 49 6,645 Latin America 3,289 77 3,328 3,240 73 3,276 UK and Ireland 3,191 243 3,313 3,371 253 3,497 EMEA/Asia Paciﬁc 3,955 69 3,989 3,671 72 3,707 T otal operating segments 17,427 438 17,646 16,902 447 17,125 Central Activities 181 16 189 186 25 199 17,608 454 17,835 17,088 472 17,324 Notes to the Group ﬁnancial statements continued Experian plc Financial statements 170 12. Amortisation and depr eciation charges 2021 US$m 2020 US$m Benchmark: Amortisation of other intangible assets 326 287 Depreciation of pr operty , plant and equipment 127 126 453 413 Non-benchmark: Amortisation of acquisition intangibles 138 124 591 537 An analysis by segment of amounts char ged within Benchmark PBT is given in note 9(a)(iv). Analyses by asset type ar e given in notes 21 and 22. The depreciation char ge for the year includes US$55m (2020: US$54m) in r espect of right-of-use assets. 13. F ees payable to the Company’s auditor 2021 US$m 2020 US$m Audit of the Company and Group ﬁnancial statements 0.7 0.6 Audit of the ﬁnancial statements of the Company’s subsidiaries 4.5 4.2 Audit-r elated assurance services 0.6 0.4 Other assurance services 0.1 0.5 T otal fees payable to the Company’s auditor and its associates 5.9 5.7 Summary of fees by nature: Fees f or audit services 5.2 4.8 Fees f or audit-r elated assurance services 0.6 0.4 Fees f or other assurance services 0.1 0.5 5.9 5.7 The guidelines covering the use of the Company’s auditor for non-audit services ar e set out in the Audit Committee report. Fees for other assur ance services were c apped at 30% (2020: 20%) of the fees for audit services. The cap was incr eased in light of the Revised Ethical Standar d issued by the UK Financial Reporting Council in December 2019, but also includes audit-r elated assurance services. In the year ended 31 March 2021, fees pay able for non-audit services, wer e 13% (2020: 20%) of fees payable for audit services. The fees for the year ended 31 March 2020 for non-audit services, excluding audit-r elated assurance services wer e 11% of fees payable for audit services. Such fees ar e reported within Other oper ating charges. The fees for audit-r elated assur ance services relate to the Gr oup’s half-yearl y ﬁnancial report and US$0.1m (2020: US$0.4m) of the fees for other assurance services was f or bond issuance related r eports. 171 Experian plc Annual Report 2021 Financial statements 14. Ex ceptional items and other adjustments made to derive Benchmark PBT – c ontinuing oper ations (a) Net charge for Exceptional items and other adjustments made to deriv e Benchmark PBT Notes 2021 US$m 2020 US$m Exceptional items: Proﬁt on disposal of associate 14(b) (120) — Restructuring costs 14(c) 50 — Impairment of intangible asset  14(d) 27 — Legal provisions movements  14(e) 8 35 Net (credit)/charge for Exceptional items (35) 35 Other adjustments made to derive Benchmark PBT: Amortisation of acquisition intangibles 12,21 138 124 Impairment of goodwill  20 53 — Acquisition and disposal expenses 41 39 Adjustment to the fair value of contingent consider ation  1 (4) Non-benchmark share of post -tax proﬁt of associates 23 (16) (6) Interest on uncertain tax pr ovisions 11 14 Financing fair value remeasur ements 15(c) (5) 111 Net charge for other adjustments made to derive Benchmark PBT 223 278 Net charge for Exceptional items and other adjustments made to derive Benchmark PBT 188 313 By income statement caption: Labour costs 30 8 Amortisation and depreciation char ges 138 124 Other operating char ges 150 62 Proﬁt on disposal of associate (120) — Within operating pr oﬁt 198 194 Within share of post -tax proﬁt of associates (16) (6) Within ﬁnance expense 15(a) 6 125 Net charge for Exceptional items and other adjustments made to derive Benchmark PBT 188 313 1 Included in other operating char ges . Acquisition and disposal expenses repr esent prof essional fees and expenses associated with completed, ongoing and terminated acquisition and disposal processes, as well as the integr ation and separation costs associated with completed deals. Of the total, US$2m (2020: US$8m) is recor ded within labour costs in the Group income statement, and US$39m (2020: US$31m) is included within other oper ating charges. (b) Proﬁt on disposal of investment in associate On 18 November 2020, the Gr oup disposed of its 18.6% interest in Finicity Corporation for US$127m, recognising a gain on disposal of US$120m. (c) Restructuring costs During the year the Group commenced a tr ansformation programme in the UK and Ir eland. The objectives of this progr amme are to simplify our technology estate, enhance customer experience and to r eturn to proﬁtable growth. In addition, we hav e launched a progr amme of restructuring initiatives in other regions. Costs of US$50m have been recognised, principally in the UK and Ir eland, in connection with these actions with a related c ash outﬂow of US$39m. Of this char ge, US$28m related to r edundancy costs, and US$22m r elated to other restructuring and consultancy costs included within other operating char ges in the Group income statement. No further costs are e xpected to be incurred in r elation to these initiatives. (d) Impairment of intangible asset During the year an internally gener ated software asset in the UK and Ir eland with a net book value of US$27m was identiﬁed as r equiring impairment due to planned upgrade of our technology estate. (e) Legal provisions movements During the current and prior year ther e has been a movement in provisions and related r eceivables in r espect of a number of historic legal claims. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 172 15. Net ﬁnanc e costs (a) Net ﬁnance costs included in proﬁt before tax 2021 US$m 2020 US$m Interest income: Bank deposits, short -term investments and loan notes (11) (13) Interest on pension plan assets (1) — Interest income (12) (13) Finance expense: Eurobonds and notes 102 89 Bank loans, commer cial paper , over dr afts and other 8 35 Commitment and facility fees 6 5 Interest on leases 10 10 Interest dier entials on derivatives 7 6 Interest expense 133 145 (Credit)/char ge in respect of ﬁnancing fair value r emeasurements (note 15(c)) (5) 111 Interest on uncertain tax pr ovisions 11 14 Finance expense 139 270 Net ﬁnance costs included in proﬁt before tax 127 257 (b) Net interest expense included in Benchmark PBT 2021 US$m 2020 US$m Interest income (12) (13) Interest expense 133 145 Net interest expense included in Benchmark PBT 121 132 (c) Analysis of charge for ﬁnancing fair v alue remeasurements 2021 US$m 2020 US$m F air value (gains)/losses on borrowings – attributable to interest r ate risk (35) 12 F air value losses/(gains) on borrowings – attributable to currency risk 114 (28) Losses/(gains) on interest r ate swaps – fair value hedges 31 (26) (Gains)/losses on cross-curr ency swaps – fair value hedges (75) 33 For eign currency gain on cross-currency swaps designated as a c ashﬂow hedge – tr ansfer from OCI (33) — Gains/(losses) on items in hedging relationships – hedge ineectiveness 2 (9) F air value (gains)/losses on non-hedging derivatives (16) 70 For eign exchange losses on Brazilian real intr a-Group funding 16 54 Other foreign exchange losses/(gains) on ﬁnancing activities 9 (1) Decrease in pr esent value of put options (13) (2) Movement in Other ﬁnancial assets at FVPL (3) — Movement in connection with commitments to purchase own shar es — (1) (5) 111 173 Experian plc Annual Report 2021 Financial statements 15. Net ﬁnanc e costs continued (d) Interest r ate risk The following table shows the sensitivity to inter est rate risk, on the basis of the proﬁle of Net debt at the balance sheet dates and an assessment of reasonably possible changes in the principal inter est rates, with all other variables held constant. In making this assessment, actual movements in relevant inter est rates over the most recent thr ee-year period ha ve been considered and a consistent methodology applied. An indication of the primary cause of the r eported sensitivity is included. Gain/(loss) 2021 US$m 2020 US$m Impact on proﬁt for the ﬁnancial year: Eect of an increase of 1.1% (2020: 0.7%) on US dollar -denominated Net debt: Due to fair value gains on interest r ate swaps oset by higher interest on ﬂoating rate borr owings 19 11 Eect of an increase of 0.3% (2020: 0.2%) on pound sterling-denominated Net debt: Due to the revaluation of borr owings and related derivatives 2 1 Eect of an increase of 2.1% (2020: 2.8%) on Br azilian real -denominated Net debt: Due to higher interest income on cash and c ash equivalents 1 1 Eect of an increase of 0.1% (2020: 0.1%) on eur o-denominated Net debt: Due to fair value gains on interest r ate swaps oset by higher interest on ﬂoating rate borr owings — — Impact on other components of equity: Eect of an increase of 1.1% (2020: 0.7%) on US dollar -denominated Net debt: Due to fair value gains on cross-curr ency swaps treated as a cash ﬂow hedge 20 — Eect of an increase of 0.3% (2020: 0.2%) on pound sterling-denominated Net debt: Due to fair value gains on cross-curr ency swaps treated as a cash ﬂow hedge (6) — 16. T ax char ge (a) Analysis of tax charge in the Gr oup income statement 2021 US$m 2020 US$m Current tax: T ax on income for the year 193 206 Adjustments in respect of prior year s 2 6 T otal current tax charge 195 212 Deferred tax: Origination and reversal of tempor ary dierences 79 58 Adjustments in respect of prior year s 1 (7) T otal deferred tax char ge 80 51 T ax charge 275 263 The tax charge comprises: UK tax 9 10 Non-UK tax 266 253 275 263 Notes to the Group ﬁnancial statements continued Experian plc Financial statements 174 16. T ax char ge continued (b) T ax reconciliations (i) Reconciliation of the tax charge As the Group is subject to the tax r ates of more than one country , it has chosen to present its r econciliation of the tax charge using the main r ate of corporation tax in the UK. The eective rate of tax for each year based on pr oﬁt befor e tax is higher (2020: higher) than the main rate of corpor ation tax in the UK, with the dier ences explained in note 16(c). 2021 US$m 2020 US$m Proﬁt befor e tax 1,077 942 Proﬁt befor e tax multiplied by the main r ate of UK corporation tax of 19% (2020: 19%) 205 179 Eects of: Adjustments in respect of prior year s 3 (1) T ax on Exceptional items (16) 3 Income not taxable (5) (15) Losses not recognised 20 18 Expenses not deductible 15 9 Dierent eective tax r ates in non-UK businesses 31 31 Local taxes 33 40 Recognition/utilisation of previously unr ecognised tax losses (11) (1) T ax charge 275 263 Eective rate of tax based on pr oﬁt before tax 25.5% 27.9% Expenses not deductible include movements in uncertain tax provisions and the impairment of goodwill. Local taxes primarily comprise US state taxes. (ii) Reconciliation of the tax charge to the Benchmark tax char ge 2021 US$m 2020 US$m T ax charge 275 263 T ax relief on Exceptional items and other adjustments made to derive Benchmark PBT 53 61 Benchmark tax charge 328 324 Benchmark PBT 1,265 1,255 Benchmark tax rate 25.9% 25.8% (c) F actors that aect the tax charge Prior year adjustments reﬂect the net mov ement on historical tax positions, including adjustments for matters that have been substantively agr eed with local tax authorities, and adjustments to deferred tax assets based on latest estimates and assumptions. Expenses not deductible include charges in r espect of uncertain tax positions, ﬁnancing fair v alue remeasur ements not allowable for tax purposes, and losses on the disposal of businesses which are not subject to tax r elief . The Group’s tax r ate reﬂects its internal ﬁnancing arrangements in place to fund non-UK businesses. In addition, in the normal cour se of business, the Gr oup has a number of open tax returns with v arious tax authorities with whom it is in active dialogue. At 31 March 2021 the Gr oup held current pr ovisions of US$350m (2020: US$327m) in respect of uncertain tax positions. Liabilities r elating to these open and judgmental matters are based on an assessment as to whether additional taxes will be due, after taking into account external advice where appropriate. The r esolution of these tax matters may take many y ears. While the timing of developments in r esolving these matters is inher ently uncertain, the Gr oup does not expect to materially incr ease its uncertain tax provisions in the next 12 months, however if an opportunity arose to resolve the matters for less than the amounts pro vided, a settlement may be made with a corr esponding reduction in the provision. (d) Other factors that aect the future tax char ge The Group’s tax char ge will continue to be inﬂuenced by the proﬁle of pr oﬁts earned in the dierent countries in which the Group’s subsidiaries oper ate. The Group could be aected by changes in tax law in the futur e, as we expect countries to amend legislation in respect of international tax. The main rate of UK corpor ation tax is 19% and it has been announced that the rate will increase to 25% fr om 1 April 2023. This will have a consequential eect on the Group’s futur e tax charge. If this rate change had been substantively enacted at the current balance sheet date the deferr ed tax asset would have increased by US$13m. 17. Disc ontinued operations There have been no material divestments of subsidiaries during the y ear ended 31 March 2021. On 31 May 2017, the Group completed the divestment of CCM, and the r esults and cash ﬂow s of that business were accor dingly classiﬁed as discontinued. R esidual disposal costs of US$2m were incurr ed during the year ended 31 March 2020 and c ash outﬂows fr om operating activities wer e US$6m in that year . 175 Experian plc Annual Report 2021 Financial statements 18. Earnings per shar e disclosures (a) Earnings per share Basic Diluted 2021 US cents 2020 US cents 2021 US cents 2020 US cents Continuing and discontinued operations 88.2 74.8 87.6 74.2 Add: loss from discontinued oper ations — 0.2 — 0.2 Continuing operations 88.2 75.0 87.6 74.4 Add: Exceptional items and other adjustments made to derive Benchmark PBT , net of related tax 14.9 28.0 14.7 27.7 Benchmark EPS (non-GAAP measur e) 103.1 103.0 102.3 102.1 (b) Analysis of earnings (i) Attributable to owners of Experian plc 2021 US$m 2020 US$m Continuing and discontinued operations 803 675 Add: loss from discontinued oper ations — 2 Continuing operations 803 677 Add: Exceptional items and other adjustments made to derive Benchmark PBT , net of related tax 135 252 Benchmark earnings attributable to owners of Experian plc (non-GAAP measur e) 938 929 (ii) Attributable to non-controlling inter ests 2021 US$m 2020 US$m (Loss)/proﬁt for the ﬁnancial year attributable to non-controlling inter ests (1) 2 Add: amortisation of acquisition intangibles attributable to non-controlling inter ests, net of r elated tax — — Benchmark earnings attributable to non-controlling inter ests (non-GAAP measur e) (1) 2 (c) Reconciliation of T otal Benchmark earnings to proﬁt for the ﬁnancial year 2021 US$m 2020 US$m T otal Benchmark earnings (non-GAAP measure) 937 931 Loss from discontinued oper ations — (2) Loss from Exceptional items and other adjustments made to derive Benchmark PBT , net of related tax (135) (252) Proﬁt for the ﬁnancial year 802 677 (d) W eighted average number of or dinary shares 2021 million 2020 million Weighted av erage number of or dinary shares 910 902 Add: dilutive eect of share incentive awar ds, options and share pur chases 7 8 Diluted weighted average number of or dinary shares 917 910 19. Dividends 2021 2020 US cents per share US$m US cents per share US$m Amounts recognised and paid during the ﬁnancial year: First interim – paid in F ebruary 2021 (2020: January 2020) 14.5 133 14.5 130 Second interim – paid in July 2020 (2020: July 2019) 32.5 294 32.5 294 Dividends paid on ordinary shares 47.0 427 47.0 424 Full -year dividend for the ﬁnancial year 1 47.0 430 47.0 423 1 The cost of the second interim dividend for the year ended 31 March 2020 paid in July 2020, incr eased by US$1m due to foreign exchange r ate movements. A second interim dividend in respect of the year ended 31 Mar ch 2021 of 32.5 US cents per ordinary share will be paid on 23 July 2021, to shareholders on the register at the close of business on 25 June 2021. This dividend is not included as a liability in these ﬁnancial statements. This second interim dividend and the ﬁrst interim dividend paid in F ebruary 2021 comprise the full- year dividend for the ﬁnancial year of 47.0 US cents per or dinary share. Further administr ative information on dividends is given in the Shareholder and corporate inf ormation section. Dividend amounts ar e quoted gross. In the year ended 31 March 2021, the employee trusts waived their entitlements to dividends of US$2m (2020: US$4m). Ther e is no entitlement to dividend in respect of own shar es held as treasury shar es. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 176 20. Goodwill (a) Movements in goodwill 2021 US$m 2020 US$m Net book amount At 1 April 4,543 4,324 Dierences on exchange 114 (252) Additions through business combinations (note 41(a)) 657 471 Impairment charge (53) — At 31 March 5,261 4,543 The gross c arrying amount of goodwill was US$5,314m at 31 March 2021, US$4,543m at 31 March 2020 and US$4,324m at 31 Mar ch 2019. The accumulated impairment loss was US$53m at 31 March 2021 and US$nil at 31 Mar ch 2020 and 31 March 2019. (b) Goodwill by CGU 2021 US$m 2020 US$m North America 3,133 2,943 Latin America 611 530 UK and Ireland 718 656 EMEA 711 286 Asia Paciﬁc 88 128 At 31 March 5,261 4,543 (c) Key assumptions for value-in-use c alculations by CGU 2021 2020 Discount rate % pa Long-term growth rate % pa Discount rate % pa Long-term growth r ate % pa North America 9.1 2.3 12.5 2.3 Latin America 12.8 4.7 16.8 4.7 UK and Ireland 8.9 2.3 10.7 2.3 EMEA 10.4 3.9 14.7 3.9 Asia Paciﬁc 9.4 5.3 10.8 5.3 As indicated in note 5(a), value-in-use calculations ar e underpinned by ﬁnancial budgets, looking forward up to ﬁve year s. Management’s k ey assumptions in setting the ﬁnancial budgets for the initial ﬁve-year period wer e as follows: for ecas t reve nue grow th r ates w ere ba sed on p ast ex per ienc e, adjus ted f or the s trate gic opp or tuni ties w ithin ea ch CGU; t he for ecas ts t yp ically u sed av erag e nomi nal grow th r ates of up to 1 1 %, wi th As ia Paciﬁ c havin g rate s of up to 1 7% ; Ben chmark E BIT w as for ecas t bas ed on his tor ic margin s. Th ese w ere ex pec ted to b e stab le thro ughou t the p erio d in the ma ture CG Us, and i mprov e annually b y a low -singl e- digit am ount in EM EA an d Asia P aciﬁ c; and for ecas t Ben chmark o per ating c ash ﬂow c onver sion ra tes wer e bas ed on his tori c expe rien ce and p er for mance ex pec tat ions wi th rat es in a ran ge fr om 65% to 90% unl ess a B enchma rk EBI T los s was for eca st. In t hes e circum stan ces ca sh out ﬂow s were fo rec ast to exc eed t he Ben chmar k EBI T loss . Further details of the principles used in determining the basis of alloc ation by CGU and annual impairment testing are given in note 5(a). (d) Results of annual impairment r eview as at 31 March 2021 The review for the EMEA CGU indic ated that the recover able amount exceeded the carrying value by US$348m and that any decline in estimated value-in-use in excess of that amount would r esult in the recognition of an impairment char ge. The sensitivities, which r esult in the recoverable amount being equal to the carrying value, can be summarised as follows: an absolute increase of 2.0 per centage points in the discount rate, from 10.4% to 12.4%; or an absolute reduction of 2.7 per centage points in the long-term growth r ate, from gr owth of 3.9% to a growth of 1.2%; or a reduction of 6.8 per centage points in the forec ast terminal proﬁt mar gin, fr om 23.6% to 16.8%. A reduction in the annual mar gin improvement of approximatel y 1.4 percentage points per year ov er the ﬁve-year for ecast period would also r educe the recov erable amount to the c arrying value. F ollowing a challenging year impacted by the eects of the COVID-19 pandemic, growth In Asia P aciﬁc was adversely aected. Accor dingly , the carrying value of the Asia Paciﬁc CGU has been r educed to its recoverable amount of US$138m thr ough recognition of an impairment char ge of US$53m. This charge is r ecognised within Other operating char ges in the Group income statement. Any additional movement in the k ey assumptions at the balance sheet date would lead to a further impairment of goodwill. An absolute incr ease of 1.0 percentage points in the discount r ate would lead to a further impairment of US$42m or an absolute reduction in the long-term gr owth r ate of 1.0 percentage points would lead to a further impairment of US$38m. The recover able amount of all other CGUs exceeded their carrying value, on the basis of the assumptions set out in the table in note 20(c) and an y reasonably possible changes ther eof . 177 Experian plc Annual Report 2021 Financial statements 21. Other intangible assets Acquisition intangibles Databases US$m Internal use software US$m Internally generated software US$m T otal US$m Customer and other relationships US$m Acquired software development US$m Marketing- related assets US$m Cost At 1 April 2020 1,094 337 91 1,311 376 860 4,069 Dierences on exchange 25 8 (2) (13) (2) 35 51 Additions through business combinations 386 57 11 8 1 18 481 Other additions — — — 147 30 197 374 Other disposals — (1) — (108) (78) (68) (255) At 31 March 2021 1,505 401 100 1,345 327 1,042 4,720 Accumulated amortisation and impairment At 1 April 2020 617 224 81 882 300 382 2,486 Dierences on exchange 10 5 (2) (8) 1 20 26 Charge for the year 94 38 6 157 28 141 464 Impairment charge — — — — — 33 33 Other disposals — (1) — (108) (78) (68) (255) At 31 March 2021 721 266 85 923 251 508 2,754 Net book amount at 31 March 2021 784 135 15 422 76 534 1,966 Acquisition intangibles Databases US$m Internal use software US$m Internally generated software US$m T otal US$m Customer and other relationships US$m Acquired software development US$m Marketing- related assets US$m Cost At 1 April 2019 1,023 295 98 1,394 362 709 3,881 Dierences on exchange (73) (20) (11) (170) (23) (29) (326) Additions through business combinations 144 62 4 1 1 3 215 Other additions — — — 175 39 189 403 Other disposals — — — (89) (3) (12) (104) At 31 March 2020 1,094 337 91 1,311 376 860 4,069 Accumulated amortisation and impairment At 1 April 2019 586 205 83 932 290 311 2,407 Dierences on exchange (47) (17) (12) (124) (16) (13) (229) Charge for the year 78 36 10 163 28 96 411 Other disposals — — — (89) (2) (12) (103) At 31 March 2020 617 224 81 882 300 382 2,486 Net book amount at 1 April 2019 437 90 15 462 72 398 1,474 Net book amount at 31 March 2020 477 113 10 429 76 478 1,583 Within the above are the follo wing individually material assets at 31 March 2021: North America Healthcar e customer relationships ha ve a net book value of US$188m, with a remaining amortisation period of seven year s. North America T apad, Inc. customer relationships with a net book v alue of US$152m and a remaining amortisation period of 13 year s. Arvato Risk Management customer relationships with a net book v alue of US$146m, and a r emaining amortisation period of 12 years. In addition to the development capitalised above we char ged US$138m (2020: US$153m) of resear ch and development costs in the Group income statement. The impairment charge in the year lar gely relates to an internally generated softwar e asset in the UK and Ireland identiﬁed as r equiring impairment due to planned upgrade of our technology estate. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 178 22. Pr operty , plant and equipment Freehold properties US$m Leasehold improvements US$m Plant and equipment US$m Right-of-use assets T otal US$m Land and buildings US$m Motor vehicles US$m Plant and equipment US$m Cost At 1 April 2020 127 154 589 197 15 29 1,111 Dierences on exchange 10 — 23 4 1 — 38 Additions through business combinations — — 2 3 — — 5 Other additions — 4 44 26 8 23 105 Disposals (1) (4) (30) (35) (4) (11) (85) At 31 March 2021 136 154 628 195 20 41 1,174 Accumulated amortisation and impairment At 1 April 2020 42 77 438 36 5 11 609 Dierences on exchange 3 — 17 2 — — 22 Charge for the year 3 5 64 40 6 9 127 Impairment charge — — 3 1 — — 4 Disposals — (4) (27) (17) (3) (6) (57) At 31 March 2021 48 78 495 62 8 14 705 Net book amount at 31 March 2021 88 76 133 133 12 27 469 Fr eehold properties US$m Leasehold improvements US$m Plant and equipment US$m Right-of-use assets T otal US$m Land and buildings US$m Motor vehicles US$m Plant and equipment US$m Cost At 1 April 2019 139 142 556 176 11 20 1,044 Dierences on exchange (17) — (26) (10) — (1) (54) Additions through business combinations 2 — 2 — — — 4 Other additions 3 12 69 34 6 10 134 Disposals — — (12) (3) (2) — (17) At 31 March 2020 127 154 589 197 15 29 1,111 Accumulated depreciation At 1 April 2019 43 72 401 — — 3 519 Dierences on exchange (4) — (18) (2) — — (24) Charge for the year 3 5 64 40 6 8 126 Disposals — — (9) (2) (1) — (12) At 31 March 2020 42 77 438 36 5 11 609 Net book amount at 1 April 2019 96 70 155 176 11 17 525 Net book amount at 31 March 2020 85 77 151 161 10 18 502 The disposal of right-of-use assets in the year ended 31 Mar ch 2021 largely relates to sublease arr angements, leading to the der ecognition of right-of-use assets and the r ecognition of sublease receiv ables in North America. 179 Experian plc Annual Report 2021 Financial statements 23. In vestments in associates 2021 US$m 2020 US$m At 1 April 123 122 Dierences on exchange 6 (5) F air value gain on step acquisition — 17 Acquisition of controlling stake in associate — (19) Share of (loss)/pr oﬁt after tax (2) 37 Dividends received (17) (6) Impairment charge — (23) Reversal of pr evious impairment charge 23 — Disposals (5) — At 31 March 128 123 On 18 November 2020, the Gr oup disposed of its 18.6% interest in Finicity Corporation for US$127m. A gain on disposal of US$120m was recognised in the Group income statement, after additional costs of US$2m in relation to the tr ansaction. In the year ended 31 March 2020 the shar e of proﬁt after tax of associates included a gain of US$36m relating to a signiﬁcant business disposal by an associate, together with an impairment char ge of US$23m in respect of the in vestment in that associate. The recover able amount of the investment in the associate has been assessed during the year and in light of a favour able tr ading performance a reversal of the impairment char ge of US$23m has been recognised. The gain on disposal, impairment char ge and its rever sal are r eported within non-benchmark items in the Group income statement. 24. Tr ade and other receivables (a) Analysis by type and maturity 2021 US$m 2020 US$m T rade and unbilled receivables 923 853 Credit note pr ovision (19) (13) T rade receivables – after cr edit note provision 904 840 Contract assets 151 167 T rade receivables and contr act assets 1,055 1,007 Loss allowance (23) (25) Net impaired tr ade receiv ables and contract assets 1,032 982 V A T and equivalent taxes recover able 5 4 Prepayments 220 160 Contract costs 100 96 1,357 1,242 As reported in the Gr oup balance sheet: Current tr ade and other receiv ables 1,197 1,078 Non-current tr ade and other receiv ables 160 164 1,357 1,242 There is no material dier ence between the fair value and the book value stated above. Non-current trade and other r eceivables comprise pr epayments, contract assets, unbilled receivables and contract costs. At 31 March 2019, the value of trade and unbilled receiv ables was US$796m and contr act assets was US$129m. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 180 24. Tr ade and other receivables c ontinued (b) Loss allowance matrix 2021 2020 Loss allowance US$m Gross carrying amount US$m Loss allowance US$m Gross carrying amount US$m Not past-due (3) 840 (8) 795 Up to three months past -due (2) 157 (3) 158 Three to six months past -due (2) 26 (2) 24 Over six months past-due (16) 32 (12) 30 T rade receivables and contr act assets (23) 1,055 (25) 1,007 Loss allowance (note 24(c)) (23) (25) Net trade receivables and contr act assets 1,032 982 (c) Movements in the loss allowance 2021 US$m 2020 US$m At 1 April 25 18 (Decrease)/incr ease in the loss allowance recognised in the Gr oup income statement (1) 12 Receivables written o in the year as uncollectable (2) (2) Dierences on exchange 1 (3) At 31 March 23 25 (d) Analysis by denomination of curr ency Contract assets Tr ade receivables 2021 US$m 2020 US$m 2021 US$m 2020 US$m US dollar 50 73 499 478 Pound sterling 9 9 142 138 Brazilian r eal 3 4 117 96 Euro 32 35 55 32 Colombian peso — 4 13 12 South African r and 10 5 7 10 Other 47 37 48 49 151 167 881 815 25. Cash and c ash equivalents - ex cluding bank over drafts (a) Analysis by natur e 2021 US$m 2020 US$m Cash at bank and in hand 113 84 Short-term investments 67 193 180 277 The eective interest r ate for cash and cash equivalents held at 31 March 2021 is 0.8% (2020: 1.6%). There is no material dierence between the fair value and the book value stated above. (b) Analysis by e xternal credit r ating 2021 US$m 2020 US$m Counterparty holding of more than US$2m: A rated 83 221 B rated 79 37 Counterparty holding of more than US$2m 162 258 Counterparty holding of less than US$2m 18 19 180 277 181 Experian plc Annual Report 2021 Financial statements 26. Tr ade and other payables (a) Analysis by type and maturity 2021 2020 Current US$m Non-current US$m Current US$m Non-current US$m T rade payables 187 — 275 — V A T and other equivalent taxes payable 30 — 23 — Social security costs 110 — 106 — Accruals 583 4 480 6 Contract liabilities 389 114 363 87 Other payables 244 41 183 28 1,543 159 1,430 121 There is no material dier ence between the fair value and the book value stated above. Other payables include employee beneﬁts of US$97m (2020: US$83m) and deferred and contingent consider ation of US$73m (2020: US$34m). At 31 March 2019, the value of contract liabilities was US$463m. (b) Analysis by natur e 2021 US$m 2020 US$m Financial instruments 607 572 V A T and other equivalent taxes payable 30 23 Social security costs 110 106 Amounts within accruals and contract liabilities 955 850 Items other than ﬁnancial instruments 1,095 979 1,702 1,551 Contractual undiscounted futur e cash ﬂows in respect of ﬁnancial instruments are sho wn in note 32. 27. Borr owings (a) Analysis by c arrying amounts and fair value Carrying amount F air value 2021 US$m 2020 US$m 2021 US$m 2020 US$m Current: Bonds: £400m 3.50% Euronotes 2021 562 — 556 — Commercial paper 25 447 25 447 Bank overdr afts 10 5 10 5 Lease obligations (note 29) 58 46 58 46 655 498 649 498 Non-current: Bonds: £400m 3.50% Euronotes 2021 — 509 — 507 £400m 2.125% Euronotes 2024 567 512 573 500 £400m 0.739% Euronotes 2025 551 — 543 — €500m 1.375% Euronotes 2026 618 577 624 556 US$500m 4.25% Notes 2029 500 500 563 574 US$750m 2.75% Notes 2030 738 763 760 718 £400m 3.25% Euronotes 2032 562 — 618 — Bank loans 2 900 2 900 Lease obligations (note 29) 144 155 144 155 3,682 3,916 3,827 3,910 T otal borrowings 4,337 4,414 4,476 4,408 The eective interest r ates for bonds approximate to the coupon r ates indicated above. Other than lease obligations, borr owings are unsecured. Further information on the methodology used in determining fair values is given in note 31. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 182 27. Borr owings continued (b) Analysis by maturity 2021 US$m 2020 US$m Less than one year 655 498 One to two years 49 1,300 T wo to three years 35 185 Three to four year s 589 25 Four to ﬁv e years 564 527 Over ﬁve years 2,445 1,879 4,337 4,414 (c) Analysis by curr ency 2021 US$m 2020 US$m US dollar 3,599 3,545 Pound sterling 545 722 Euro 95 75 Other 98 72 4,337 4,414 The above analysis takes account of the eect of cr oss-currency swaps and forward for eign exchange contr acts and reﬂects the way in which the Gr oup manages its exposures. (d) Undrawn committed bank borr owing facilities 2021 US$m 2020 US$m F acilities expiring in: Less than one year — 75 One to two years 400 — T wo to three years 300 150 Three to four year s — — Four to ﬁv e years 1,950 1,950 2,650 2,175 These facilities are at variable inter est rates and are in place for gener al corporate purposes, including the ﬁnancing of acquisitions and the r eﬁnancing of other borrowings. (e) Covenants and lever age ratio There is one ﬁnancial covenant in connection with the borr owing facilities. Benchmark EBIT must exceed three times net inter est expense before ﬁnancing fair value remeasur ements. The calculation of the ﬁnancial covenant ex cludes the eects of IFRS 16. The Group monitors this, and the Net debt to Benchmark EBITDA lever age ratio, and has complied with this covenant throughout the year . 28. Net debt (non-G AAP measure) (a) Analysis by natur e 2021 US$m 2020 US$m Cash and cash equivalents (net of over drafts) 170 272 Debt due within one year – commercial paper (25) (447) Debt due within one year – bonds and notes (554) — Debt due after more than one year – bonds and notes (3,526) (2,858) Debt due after more than one year – bank loans (2) (900) Derivatives hedging loans and borro wings 111 35 (3,826) (3,898) 183 Experian plc Annual Report 2021 Financial statements 28. Net debt (non-G AAP measure) continued (b) Analysis by balance sheet c aption 2021 US$m 2020 US$m Cash and cash equivalents 180 277 Current borr owings (655) (498) Non-current borr owings (3,682) (3,916) Borrowings (4,337) (4,414) T otal of Group balance sheet line items (4,157) (4,137) Lease obligations reported within borr owings excluded from Net debt 202 201 Accrued interest r eported within borrowings excluded fr om Net debt 18 3 Derivatives reported within Other ﬁnancial assets 117 52 Derivatives reported within Other ﬁnancial liabilities (6) (17) (3,826) (3,898) (c) Analysis of movements in Net debt Derivatives hedging loans and borrowings US$m Current borrowings US$m Non-current borrowings US$m Liabilities from ﬁnancing activities US$m Lease obligations US$m Accrued interest US$m Cash and cash equivalents US$m Net debt US$m At 1 April 2020 35 (498) (3,916) (4,379) 201 3 277 (3,898) Cash ﬂow (54) 66 — 12 (66) — (220) (274) Borrowings c ash ﬂow — 424 (98) 326 — — — 326 Reclassiﬁcation of borr owings — (558) 558 — — — — — Net interest paid — — — — — — 115 115 Movement on accrued interest — (1) (14) (15) — 15 — — Net cash ﬂow (54) (69) 446 323 (66) 15 (105) 167 Non-cash lease obligation additions — (19) (38) (57) 57 — — — Net share pur chases — — — — — — 19 19 Additions through business combinations — (3) (16) (19) 4 — — (15) F air value gains 10 3 31 44 — — — 44 Exchange and other movements  120 (69) (189) (138) 6 — (11) (143) At 31 March 2021 111 (655) (3,682) (4,226) 202 18 180 (3,826) 1  Exchange and other movements include US$8m in respect of lease obligation disposals. Derivatives hedging loans and borrowings US$m Current borrowings US$m Non-current borrowings US$m Liabilities from ﬁnancing activities US$m Lease obligations US$m Accrued interest US$m Cash and cash equivalents US$m Net debt US$m At 1 April 2019 (119) (910) (2,618) (3,647) 217 19 149 (3,262) Cash ﬂow 169 30 33 232 (63) — 480 649 Borrowings c ash ﬂow — 284 (1,250) (966) — — — (966) Reclassiﬁcation of borr owings — 100 (100) — — — — — Net interest paid — — — — — — (152) (152) Movement on accrued interest — 4 13 17 — (17) — — Net cash ﬂow 169 418 (1,304) (717) (63) (17) 328 (469) Non-cash lease obligation additions — (20) (26) (46) 46 — — — Net share pur chases — — — — — — (188) (188) F air value gains/(losses) 14 31 (44) 1 — — — 1 Exchange and other movements (29) (17) 76 30 1 1 (12) 20 At 31 March 2020 35 (498) (3,916) (4,379) 201 3 277 (3,898) Notes to the Group ﬁnancial statements continued Experian plc Financial statements 184 29. Leases The Group’s lease portfolio consists of 35 (2020: 33) signiﬁc ant property leases acr oss the countries in which we operate. In addition, we lease approximatel y 121 (2020: 190) smaller properties, 700 (2020: 800) motor vehicles, and a small number of hardwar e assets. The aver age remaining lease term is 4.5 years (2020: 5.5 years) f or signiﬁcant pr operty leases, 1.3 year s (2020: 1.3 years) for other minor pr operty leases and 2.0 years (2020: 1.7 years) for motor vehicles and plant and equipment. Extension and termination options are included within a number of pr operty and equipment leases across the Gr oup. These are used to maximise oper ational ﬂexibility in terms of managing assets and lease exposures. The majority of extension and termination options are exer cisable only by the Gr oup and not by the respective lessor . (a) Amounts recognised in the Group balance sheet Notes 2021 US$m 2020 US$m Right-of-use assets: Land and buildings 22 133 161 Motor vehicles 22 12 10 Plant and equipment 22 27 18 At 31 March 172 189 Lease obligations: Current 27 58 46 Non-current 27 144 155 At 31 March 202 201 During the year the Group der ecognised right-of-use assets of US$13m due to sublease arrangements in North America. The lease receivable held in relation to subleases at 31 Mar ch 2021 was US$13m (2020: US$nil), of which US$11m falls due after mor e than one year . Lease payments are discounted using the inter est rate implicit in the lease. If that rate cannot be r eadily determined, which is gener ally the case for leases in the Group, the incremental borr owing rate is used. The incremental borr owing rate is unique to each country and class of assets ther ein and is based on the Group’s cost of debt, adjusted for factors speciﬁc to individual lessees and their borr owing capacity . The Group is exposed to potential futur e increases in v ariable lease payments based on an index or a rate, which are not included in the lease obligation until they take eect. (b) Maturity of lease obligations – contractual undiscounted c ash ﬂows 2021 US$m 2020 US$m Less than one year 58 54 One to two years 54 49 T wo to three years 40 39 Three to four year s 25 28 Four to ﬁv e years 16 17 Over ﬁve years 37 46 T otal undiscounted lease obligations at 31 March 230 233 (c) Amounts recognised in the Group income statement Notes 2021 US$m 2020 US$m Depreciation char ge for right-of-use assets: Land and buildings 22 40 40 Motor vehicles 22 6 6 Plant and equipment 22 9 8 T otal depreciation charge f or right-of-use assets 55 54 Interest expense 15 10 10 Expense relating to the lease of low- value assets 8 9 T otal 73 73 We had no material sublease income in the curr ent or prior year . (d) Amounts recognised in the Group c ash ﬂow statement During the year lease payments of US$66m (2020: US$63m) comprised US$56m (2020: US$55m) for r epayments of principal and US$10m (2020: US$8m) for payments of interest. 185 Experian plc Annual Report 2021 Financial statements 29. Leases c ontinued (e) Lease commitments The Group’s commitments for lease agr eements where the term has not y et commenced total US$1m (2020: US$7m); such amounts are not r ecognised as lease obligations or right-of-use assets. 30. Financial assets and liabilities (a) Financial assets revalued through OCI 2021 2020 Current US$m Non-current US$m T otal US$m Current US$m Non-current US$m T otal US$m Cash ﬂow hedge of borrowings (cr oss-currency swaps) — 37 37 — — — Listed investments — 44 44 — 32 32 T rade investments — 164 164 — 139 139 — 245 245 — 171 171 Listed investments are held in the UK to secur e certain unfunded pension arrangements (note 34(b)). (b) Other ﬁnancial assets and liabilities (i) Summary Assets 2021 2020 Current US$m Non-current US$m T otal US$m Current US$m Non-current US$m T otal US$m Financial assets held at amortised cost — 103 103 — 94 94 Derivative ﬁnancial instruments: F air value hedge of borrowings (cross-curr ency swaps) — 81 81 — 10 10 F air value hedge of borrowings (interest r ate swaps) 5 — 5 — 35 35 Derivatives used for hedging 5 81 86 — 45 45 Non-hedging derivatives (equity swaps) — — — 2 — 2 Non-hedging derivatives (for eign exchange contracts) 6 — 6 15 — 15 Non-hedging derivatives (interest r ate swaps) 9 27 36 — 58 58 Other ﬁnancial assets at fair value through pr oﬁt or loss — 12 12 — 26 26 Assets at fair value through pr oﬁt or loss 20 120 140 17 129 146 T otal other ﬁnancial assets 20 223 243 17 223 240 T otal other ﬁnancial assets comprise: Loans and receivables — 103 103 — 94 94 Derivative ﬁnancial instruments 20 108 128 17 103 120 Convertible loan notes — 12 12 — 26 26 20 223 243 17 223 240 Liabilities 2021 2020 Current US$m Non-current US$m T otal US$m Current US$m Non-current US$m T otal US$m Derivative ﬁnancial instruments: F air value hedge of borrowings (cross-curr ency swaps) — — — — 6 6 Derivatives used for hedging — — — — 6 6 Non-hedging derivatives (equity swaps) — 2 2 — 1 1 Non-hedging derivatives (for eign exchange contracts) 6 — 6 8 — 8 Non-hedging derivatives (interest r ate swaps) 2 64 66 2 100 102 Derivative ﬁnancial instruments 1 8 66 74 10 107 117 Options in respect of non-contr olling interests 7 213 220 13 — 13 T otal other ﬁnancial liabilities 15 279 294 23 107 130 1 Derivative ﬁnancial liabilities are valued at FVPL. Amounts recognised in the Gr oup income statement in connection with the Group’s hedging instruments ar e disclosed in note 15. There is no material dierence between the fair values and the book v alues stated above. Financial assets held at amortised cost principally comprise amounts due following the disposal of businesses and include accrued interest. Other ﬁnancial assets at fair value through pr oﬁt or loss comprise convertible loan notes purchased when acquiring interests in associates and tr ade investments. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 186 30. Financial assets and liabilities c ontinued (ii) F air value and notional principal amounts of derivative ﬁnancial instruments 2021 2020 Assets Liabilities Assets Liabilities F air value US$m Notional US$m F air value US$m Notional US$m F air value US$m Notional US$m F air value US$m Notional US$m Cross-curr ency swaps 118 1,413 — — 10 504 6 395 Interest r ate swaps 41 1,201 66 1,563 93 1,046 102 2,097 Equity swaps — — 2 22 2 12 1 8 For eign exchange contracts 6 508 6 545 15 286 8 198 165 3,122 74 2,130 120 1,848 117 2,698 Notional principal amounts are the amount of principal underlying the contr acts at the reporting dates. (iii) Osetting derivative ﬁnancial assets and liabilities held with the same counterparty Assets Liabilities 2021 US$m 2020 US$m 2021 US$m 2020 US$m Reported in the Group balance sheet 165 120 74 117 Related amounts not oset in the Group balance sheet (60) (70) (60) (70) Net amount 105 50 14 47 There ar e no amounts oset within the assets and liabilities reported in the Gr oup balance sheet. (c) Hedge accounting (i) F air value and cash ﬂow hedges We use inter est rate swaps to hedge the interest r ate risk arising on ﬁxed r ate borrowings, and cross-currency swaps to hedge the currency and inter est rate risk arising on for eign currency ﬁxed rate borr owings. Our risk management strategy for inter est rate risk and currency risk is outlined in note 7. We determine the existence of an economic r elationship between the hedging instruments and hedged items by comparing the currency , refer ence interest r ates, duration, repricing and maturity dates and the notional amounts of the hedging instruments to those of the hedged items. We ha ve established a hedge ratio of 1:1 for the hedging r elationships as the underlying risk of interest rate swaps and cr oss-currency swaps is identic al to the hedged risk components. The main sources of ineectiveness in the hedge accounting r elationships arise from: The application of dierent inter est rate curves to discount the cash ﬂows of the hedged item and those of the hedging instrument. Dierences in timing of cash ﬂow s of the hedged item and hedging instrument. The dierent impact of the counterparties’ cr edit risk on the fair value movements of the hedging instrument compar ed to the hedged item. (ii) Analysis of hedging instruments The Group held the following instruments to hedge exposur es to changes in foreign currency and inter est rates. At 31 March 2021 Maturity Less than one year One to two years T wo to three years Three to four years F our to ﬁve years Over ﬁve years F air value hedges Interest r ate risk Interest r ate swaps: Notional amount (US$m) 207 — — — — 300 Weighted av erage ﬁxed inter est r ate 3.50% — — — — 1.66% Cross-curr ency swaps: Notional amount (US$m) — — — 395 — 504 Weighted av erage ﬁxed inter est r ate — — — 2.13% — 1.38% For eign currency risk Cross-curr ency swaps: Notional amount (US$m) — — — 395 — 504 EUR:USD forward contr act rate — — — — — 1.12 GBP:USD forward contr act rate — — — 1.32 — — Cash ﬂow hedge For eign currency risk Cross-curr ency swaps: Notional amount (US$m) — — — — 515 — GBP:USD forward contr act rate — — — — 1.29 — 187 Experian plc Annual Report 2021 Financial statements 30. Financial assets and liabilities c ontinued (ii) Analysis of hedging instruments continued At 31 March 2020 Maturity Less than one year One to two years T wo to three years Three to four years Four to ﬁve years Over ﬁve years F air value hedges Interest r ate risk Interest r ate swaps: Notional amount (US$m) — 186 — — — 300 Weighted av erage ﬁxed inter est r ate — 3.50% — — — 1.66% Cross-curr ency swaps: Notional amount (US$m) — — — — 395 504 Weighted av erage ﬁxed inter est r ate — — — — 2.13% 1.38% F oreign curr ency risk Cross-curr ency swaps: Notional amount (US$m) — — — — 395 504 EUR:USD forward contr act rate — — — — — 1.12 GBP:USD forward contr act rate — — — — 1.32 — (d) Impact of hedging instruments 2021 Notional amount of hedging instrument US$m Carrying amount of hedging instrument Changes in fair value used for calculating hedge ineectiveness (Note 15(c)) US$m Assets US$m Liabilities US$m F air value hedges Interest r ate risk Interest r ate swaps 507 5 — 31 Cross-curr ency swaps 899 81 — 10 For eign exchange risk Cross-curr ency swaps 899 81 — (85) Cash ﬂow hedge For eign exchange risk Cross-curr ency swaps 515 37 — (35) 2020 Notional amount of hedging instrument US$m Carrying amount of hedging instrument Changes in fair value used for calculating hedge ineectiveness (Note 15(c)) US$m Assets US$m Liabilities US$m F air value hedges Interest r ate risk Interest r ate swaps 486 35 — (26) Cross-curr ency swaps 899 10 (6) 3 F oreign e xchange risk Cross-curr ency swaps 899 10 (6) 30 Interest r ate swaps are reported within Other ﬁnancial assets, and cross-curr ency swaps are r eported within Other ﬁnancial assets and Other ﬁnancial liabilities in the Group balance sheet. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 188 30. Financial assets and liabilities c ontinued (e) Impact of hedged items 2021 2020 Carrying amount of hedged item Accumulated amount of fair value hedge adjustments included in the carrying amount of the hedged item Changes in fair value used for calculating hedge ineectiveness (Note 15(c)) US$m Carrying amount of hedged item Accumulated amount of fair value hedge adjustments included in the carrying amount of the hedged item Changes in fair value used for calculating hedge ineectiveness (Note 15(c)) US$m Liabilities Liabilities US$m US$m US$m US$m F air value hedges Interest r ate risk Borrowings (1,494) 40 (35) (1,424) 70 12 For eign exchange risk Borrowings (987) 43 81 (910) (34) (28) Cash ﬂow hedge For eign exchange risk Borrowings (551) n/a 35 — n/a — The hedging reserve at 31 Mar ch 2021 includes US$2m (2020: US$nil) in respect of the c ash ﬂow hedge. Borr owings are reported within Borr owings in the Group balance sheet. (f) Impact of hedge ineectiveness F air value hedges (Note 15(c)) 2021 US$m 2020 US$m Interest r ate risk 6 (11) For eign exchange risk (4) 2 Gains/(losses) on items in hedging relationships – hedge ineectiveness 2 (9) Hedge ineectiveness is reported within Net ﬁnance costs in the Gr oup income statement. (g) Analysis by valuation method for put options and items measur ed at fair value 2021 2020 Level 1 US$m Level 2 US$m Level 3 US$m T otal US$m Level 1 US$m Level 2 US$m Level 3 US$m T otal US$m Financial assets: Derivatives used for hedging — 86 — 86 — 45 — 45 Non-hedging derivatives — 42 — 42 — 75 — 75 Other ﬁnancial assets at fair value through pr oﬁt or loss — — 12 12 — — 26 26 Financial assets at fair value through pr oﬁt or loss (note 30(b)) — 128 12 140 — 120 26 146 Derivatives used for hedging — 37 — 37 — — — — Listed and trade inv estments 44 — 164 208 32 — 139 171 Financial assets revalued thr ough OCI (note 30(a)) 44 37 164 245 32 — 139 171 44 165 176 385 32 120 165 317 Financial liabilities: Derivatives used for hedging — — — — — (6) — (6) Non-hedging derivatives — (74) — (74) — (111) — (111) Put options — — (220) (220 — — (13) (13) Other liabilities at fair value through pr oﬁt or loss — — (66) (66) — — (29) (29) — (74) (286) (360) — (117) (42) (159) Net ﬁnancial assets/(liabilities) 44 91 (110) 25 32 3 123 158 189 Experian plc Annual Report 2021 Financial statements 30. Financial assets and liabilities c ontinued (g) Analysis by valuation method for put options and items measur ed at fair value continued The analysis by level is a r equirement of IFRS 13 and the deﬁnitions ar e summarised here for completeness: assets and liabilities whose valuations are based on unadjusted quoted prices in active mark ets for identical assets and liabilities ar e classiﬁed as Level 1; assets and liabilities which are not tr aded in an active market, and whose valuations ar e derived from av ailable market data that is observable for the asset or liability , ar e classiﬁed as Level 2; and assets and liabilities whose valuations are derived fr om inputs not based on observable market data are classiﬁed as Level 3. Level 3 items principally comprise minority shareholdings in unlisted businesses, trade investments, contingent consideration and put options associated with corporate tr ansactions. Unlisted equity investments, initially measured at cost, are r evalued where sucient indicators ar e identiﬁed that a change in the fair value has occurr ed. The inputs to any subsequent valuations ar e based on a combination of observable evidence fr om external transactions in the in vestee’s equity and estimated discounted cash ﬂows that will arise fr om the investment. V aluations of material contingent consideration and put options associated with corporate tr ansactions, are based on Monte Carlo simulations using the most r ecent management expectations of relev ant business performance, reﬂecting the dier ent contractual arr angements in place. There would be no material eect on the amounts stated fr om any reasonabl y possible change in such inputs at 31 March 2021. (h) Analysis of movements in Lev el 3 ﬁnancial assets/(liabilities) Y ear ended 31 March 2021 Year ended 31 Mar ch 2020 Financial assets revalued through OCI US$m Other ﬁnancial assets at FVPL US$m Contingent consideration US$m Put options US$m T otal US$m Financial assets revalued through OCI US$m Other ﬁnancial assets at FVPL US$m Contingent consideration US$m Put options US$m T otal US$m At 1 April 139 26 (29) (13) 123 67 — (27) (17) 23 Additions 1,2 24 7 (33) (208) (210) 74 21 (34) — 61 Disposals — (24) — — (24) — — — — — Settlement of contingent consideration — — — — — — — 25 — 25 Adjustment to the fair value of contingent consideration — — (1) — (1) — — 4 — 4 V aluation gains recognised in the Group income statement 3 — 3 — 13 16 — — — 2 2 V aluation losses recognised in OCI — — — — — (2) — — — (2) Currency tr anslation gains/(losses) recognised dir ectly in OCI 1 — (3) (12) (14) — — 3 2 5 Other — — — — — — 5 — — 5 At 31 March 164 12 (66) (220) (110) 139 26 (29) (13) 123 1 Additions to put options, in the year ended 31 March 2021, comprised US$201m in respect of the acquisition of Arvato Risk Management, and US$7m in respect of the acquisition of Brain Soluções de T ecnologia Digital Ltda (note 41(a)). 2 Additions to contingent consideration comprised US$33m (2020: US$29m) in respect of acquisitions and US$nil (2020: US$5m) for tr ansactions in respect of non-contr olling interests. 3 Movements in the present value of expected futur e payments of put options are unr ealised and are recognised in ﬁnancing fair value remeasur ements in the Group income statement. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 190 31. F air value methodology Information in respect of the c arrying amounts and the fair value of borro wings is included in note 27(a). There ar e no material dierences between the carrying value of the Gr oup’s other ﬁnancial assets and liabilities not measured at fair v alue and their estimated fair values. The following assumptions and methods are used to estimate the fair values: the fair values of receiv ables, pay ables and cash and cash equiv alents are consider ed to appro ximate to the carrying amounts; the fair values of short-term borr owings, other than bonds, ar e considered to appr oximate to the carrying amounts due to the short maturity terms of such instruments; the fair value of that portion of bonds carried at amortised cost is based on quoted market prices, employing a valuation methodology falling within Level 1 of the IFRS 13 fair value hier archy; the fair values of long-term variable r ate bank loans and lease obligations are consider ed to approximate to the carrying amount; and the fair values of other ﬁnancial assets and liabilities are c alculated based on a discounted cash ﬂow analysis, using a valuation methodology falling within Level 2 of the IFRS 13 fair value hier archy . 32. Contr actual undiscounted future c ash ﬂows for ﬁnancial liabilities At 31 March 2021 Less than one year US$m One to two years US$m T wo to three years US$m Three to four years US$m F our to ﬁve years US$m Over ﬁve years US$m T otal US$m Borrowings 749 138 124 660 639 2,704 5,014 Net settled derivative ﬁnancial instruments – interest r ate swaps 28 26 19 11 8 6 98 Gross settled derivative ﬁnancial instruments: Outﬂows for derivative contr acts 545 — — — — — 545 Inﬂows for derivative contr acts (539) — — — — — (539) Gross settled derivative ﬁnancial instruments 6 — — — — — 6 Options in respect of acquisitions and non-contr olling interests 7 — — — 11 202 220 T rade and other payables 562 43 — — — 2 607 Cash outﬂows 1,352 207 143 671 658 2,914 5,945 At 31 March 2020 Less than one year US$m One to two years US$m T wo to three years US$m Three to four years US$m Four to ﬁve years US$m Over ﬁve years US$m T otal US$m Borrowings 583 1,372 249 88 573 2,047 4,912 Net settled derivative ﬁnancial instruments – interest r ate swaps 11 11 11 9 6 6 54 Gross settled derivative ﬁnancial instruments: Outﬂows for derivative contr acts 207 9 9 9 400 — 634 Inﬂows for derivative contr acts (199) (8) (8) (8) (380) — (603) Gross settled derivative ﬁnancial instruments 8 1 1 1 20 — 31 Options in respect of non-contr olling interests 13 — — — — — 13 T rade and other payables 538 30 — — 1 3 572 Cash outﬂows 1,153 1,414 261 98 600 2,056 5,582 The table above analyses ﬁnancial liabilities into maturity gr oupings, based on the period fr om the balance sheet date to the contractual maturity date. As the amounts disclosed are the contr actual undiscounted cash ﬂows, they dier fr om the carrying values and fair v alues. Contr actual undiscounted future c ash outﬂows for derivative ﬁnancial liabilities in total amount to US$104m (2020: US$85m). 191 Experian plc Annual Report 2021 Financial statements 33. Shar e incentive plans (a) Cost of share-based compensation 2021 US$m 2020 US$m Share awar ds 99 78 Share options 7 5 Expense recognised (all equity -settled) 106 83 Charge for associated social security obligations 5 5 T otal expense recognised in the Group income statement 111 88 The Group has a number of equity -settled, shar e-based employee incentive plans. F urther information on share awar d arrangements is given in note 33(b). As the number s of share options gr anted or outstanding and the related char ge to the Group income statement are not signiﬁcant, no further disclosures ar e included in these ﬁnancial statements. (b) Share awar ds (i) Summary of arrangements and performance conditions There ar e three plans under which shar e awar ds are curr ently granted – the two Experian Co-in vestment Plans (the CIP) and the Experian Performance Share Plan (the PSP). Aw ards typicall y take the form of a gr ant of free shar es which vest over a service period of thr ee years, with a maximum term generally of the same length, and are settled by share distribution. The assumption at gr ant date for employee departur es prior to vesting is 20% for certain unconditional awards, which are only made under the PSP . Other details in respect of conditional awar ds are given belo w . During the year ended 31 March 2021, a one-o award was made under the PSP to employees who ar e not eligible to participate in existing share awar d schemes. These awards had no service or performance conditions attached and v ested immediately . Participants who hold the shar es received for three years will be entitled to r eceive two matching shares for each shar e they originally received. The gr ant date assumption is that 30% of these matching awards will not vest. CIP F or the purposes of IFRS 2, the gr ant date for these plans is the start of the ﬁnancial year in which performance is assessed. This is befor e the number of shares to be awar ded is determined but the underlying value of the award is known, subject to the outcome of the performance condition. The value of awarded shar es reﬂects the performance outcome assumed at the date of their issue to participants and is recognised over a four -year period. The range of performance conditions f or awards under these plans is set out below . The Proﬁt perf ormance condition requir es Benchmark PBT per share gr owth at the stated percentages ov er a three-y ear period for the awar ds made in year ended 31 March 2019. The proﬁt condition for awar ds made in the years ended 31 Mar ch 2021 and 31 March 2020 r equire adjusted Benchmark EPS gr owth at the stated percentages o ver a three- year period. The cumulative Benchmark operating c ash ﬂow performance condition (the ‘Cash ﬂow condition’) is based on cumulative Benchmark oper ating cash ﬂow over a thr ee-year period. The period of assessment commences at the beginning of the ﬁnancial year of grant. These ar e not market-based performance conditions as deﬁned by IFRS 2. PSP The range of Pr oﬁt performance conditions for conditional awards under this plan is the same as those for the CIP described above. F or the years ended 31 March 2021 and 31 Mar ch 2020 there is an additional R eturn on Capital Employed condition (‘ROCE condition’). This condition requir es average ROCE over the period at the percentages stated below . Both these conditions are not market -based performance conditions as deﬁned by IFRS 2 and ar e also measured over a thr ee-year period commencing at the beginning of the ﬁnancial year of grant. The TSR performance condition is consider ed a market-based performance condition as deﬁned b y IFRS 2. In v aluing the awarded shar es, TSR is evaluated using a Monte Carlo simulation, with historic volatilities and correlations for compar ator companies measured over the three- year period preceding valuation and an implied v olatility for Experian plc ordinary shar es. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 192 33. Shar e incentive plans continued (i) Summary of arrangements and performance conditions continued Y ear ended 31 March 2021 31 March 2020 31 March 2019 CIP PSP CIP PSP CIP PSP Proﬁt condition: Measure Adjusted Benchmark EPS Adjusted Benchmark EPS Adjusted Benchmark EPS Adjusted Benchmark EPS Benchmark PBT per share Benchmark PBT per share Proportion of awar ds subject to condition 50% 50% 50% 50% 50% 75% Minimum payout requir ement 3% per annum 3% per annum 5% per annum 5% per annum 5% per annum 5% per annum T arget payout r equirement 4% per annum 4% per annum 6% per annum 6% per annum 6% per annum 6% per annum Maximum payout requir ement 7% per annum 7% per annum 9% per annum 9% per annum 9% per annum 9% per annum Assumed outcome at grant date 77.8% 77.8% 66.7% 66.7% 66.7% 66.7% Cash ﬂow condition: Proportion of awar ds subject to condition 50% — 50% — 50% — Minimum payout requir ement US$3.7bn — US$3.7bn — — — T arget payout r equirement US$3.8bn — US$3.8bn — US$3.7bn — Maximum payout requir ement US$4.1bn — US$4.1bn — US$4.1bn — Assumed outcome at grant date 77.8% — 77.2% — 66.4% — ROCE condition: Proportion of awar ds subject to condition — 25% — 25% — — Minimum payout requir ement — 14.5% per annum — 14.5% per annum — — T arget payout r equirement — 15.4% per annum — 15.4% per annum — — Maximum payout requir ement — 16.0% per annum — 16.0% per annum — — Assumed outcome at grant date — 83% — 75% — — TSR condition: Proportion of awar ds subject to condition — 25% — 25% — 25% Assumed outcome at grant date — 61.8% — 61.8% — 27.8% (ii) Information on share grant valuations Share gr ants are valued by refer ence to the market price on the day of awar d, with no modiﬁcation for dividend distributions or other factors, as participants are entitled to dividend distributions on awar ded shares. Market -based performance conditions are included in the fair v alue measurement on the grant date and ar e not revised for actual performance. A wards gr anted in the year ended 31 March 2021 had a weighted aver age fair value per share of £26.84 (2020: £23.45). (iii) Share awards outstanding 2021 million 2020 million At 1 April 12.2 13.7 Grants 4.1 4.3 Forf eitures (0.5) (0.7) Lapse of awards (0.3) (0.3) V esting (4.6) (4.8) At 31 March 10.9 12.2 Analysis by plan: CIP 3.5 4.2 PSP – conditional awards 3.0 3.4 PSP – unconditional awards 4.4 4.6 At 31 March 10.9 12.2 193 Experian plc Annual Report 2021 Financial statements 34. Post -employment beneﬁt plans and r elated risks An overview of the Group’s post -employment beneﬁt plans and the related risk s is given below . The additional information r equired by IAS 19, which relates only to the Gr oup’s deﬁned beneﬁt pension plans and post-employment medic al beneﬁts obligations, is set out in note 35. (a) Funded pension plans The Group’s principal deﬁned beneﬁt plan is the Experian Pension Scheme, which provides beneﬁts for certain UK employees. The plan was closed to new entrants in 2009. It is intended that it will close to the accrual of new beneﬁts from 1 April 2022, at which point all UK employees will be oer ed membership of the Group’s UK deﬁned contribution plan. This is currently under consultation with the active members of the plan with the outcome expected to be determined no later than 1 September 2021. The Experian Pension Scheme has rules which specify the beneﬁts to be paid, with the lev el of pension beneﬁt that an employee will receive on retir ement dependent on age, length of service and salary . As at 31 March 2021, there were 95 (2020: 110) active members of this plan, 1,309 (2020: 1,363) deferred members and 2,494 (2020: 2,596) pensioner member s. The Group pr ovides a deﬁned contribution plan, the Experian Retirement Sa vings Plan, to other eligible UK employees. Under this plan, employee and employer contributions are paid by the Gr oup into an independently administered fund, which is used to fund member pensions at r etirement. As at 31 March 2021, there wer e 3,080 active members of this plan (2020: 3,128). Both UK plans are governed by trust deeds, which ensure that their ﬁnances and governance are independent fr om those of the Group. T rustees are responsible for over seeing the investments and funding of the plans and plan administr ation. The UK pensions environment is r egulated by The Pensions Regulator whose statutory objectives and r egulatory powers are described on its website at www .thepensionsregulator .gov .uk. A full actuarial funding valuation of the Experian Pension Scheme is carried out ev ery three year s, with interim r eviews in the intervening year s. The latest full valuation was carried out as at 31 Mar ch 2019 by independent qualiﬁed actuaries Mercer Limited, using the pr ojected unit credit method and there was a small funding surplus. The next full valuation will be carried out as at 31 March 2022. Employees in the USA, Br azil and South Africa have the option to join local deﬁned contribution plans and, as at 31 March 2021, there were 4,455 (2020: 4,368) active members in the USA, 1,100 (2020: 1,256) in Br azil and 485 (2020: 556) in South Africa. Ther e are no other material funded pension arrangements. (b) Unfunded pension arrangements The Group’s unfunded pension arr angements are designed to ensure that certain director s and senior managers who are aected by the earnings c ap, which was introduced by the UK government some y ears ago to set a ceiling on the amount of beneﬁts that could be paid by deﬁned beneﬁt pension plans, ar e placed in broadly the same position as those who ar e not. There ar e also unfunded arrangements for certain former directors and emplo yees of Experian Finance plc and Experian Limited. Certain of these unfunded arr angements in the UK have been secured by the grant to an independent trustee of charges over an independently managed portf olio of marketable securities owned by the Group and r eported as ﬁnancial assets revalued through OCI (note 30(a)). (c) Post-employment medic al beneﬁts The Group oper ates a plan which provides post-employment medical beneﬁts to certain r etired employ ees and their dependant relatives. This plan relates to former employ ees in the UK and, under it, the Group has undertaken to meet the cost of post-employment medical beneﬁts f or all eligible former employees who r etired prior to 1 April 1994 and their dependants. (d) Related risks Through its deﬁned beneﬁt pension plans and post -employment medical beneﬁts plan, the Group is exposed to a number of risk s that are inher ent in such plans and arrangements, which can be summarised as follows: asset value volatility , with the associated impact on the assets held in connection with the funding of pension obligations and the r elated cash ﬂows; changes in bond yields, with any r eduction resulting in an increase in the present v alue of pension obligations, mitigated b y an increase in the value of plan assets; inﬂation, as pension obligations ar e gener ally linked to inﬂation and the prev ailing rate of inﬂation e xperienced for medical beneﬁts is typically higher than other inﬂation measures in the UK; and life expectancy , as pension and medical beneﬁts ar e generally provided for the lif e of beneﬁciaries and their dependants. There ar e no unusual, entity -speciﬁc or plan-speciﬁc risks, and no signiﬁcant concentr ations of risk. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 194 35. Post -employment beneﬁts – IAS 19 information (a) Post-employment beneﬁt amounts r ecognised in the Group ﬁnancial statements (i) Balance sheet assets/(obligations) 2021 US$m 2020 US$m Retirement beneﬁt assets/(obligations) – funded deﬁned beneﬁt plans: F air value of funded plans’ assets 1,274 1,023 Present value of funded plans’ obligations (1,172) (940) Assets in the Group balance sheet for funded deﬁned beneﬁt pensions 102 83 Obligations for unfunded post-employment beneﬁts: Present value of deﬁned beneﬁt pensions – unfunded plans (51) (44) Present value of post -employment medical beneﬁts (4) (4) Liabilities in the Group balance sheet (55) (48) Net post-employment beneﬁt assets 47 35 Pension assets are deemed to be r ecoverable and there ar e no adjustments in respect of minimum funding r equirements as, under the Experian Pension Scheme rules, futur e economic beneﬁts are available to the Group in the f orm of reductions in futur e contributions or refunds of surplus. (ii) Income statement charge 2021 US$m 2020 US$m By nature of expense: Current service cost 4 6 Administration expenses 2 2 Charge within labour costs and oper ating proﬁt 6 8 Interest income (1) — T otal net charge to the Group income statement 5 8 The income statement charge and the r emeasurement r ecognised in the Statement of comprehensive income r elate to deﬁned beneﬁt plans. In the year ended 31 March 2019, we recognised a past service cost in respect of Guar anteed Minimum Pension equalisation of US$4m. The amount of any additional liability resulting fr om the UK High Court ruling on 20 November 2020 on historic transfers is not anticipated to be material to the Gr oup. (b) Movements in net post-employment beneﬁt assets/(obligations) r ecognised in the Group balance sheet F air value of plan assets US$m Present value of obligations Movements in net position US$m Deﬁned beneﬁt pensions – funded US$m Deﬁned beneﬁt pensions – unfunded US$m Post-employment medical beneﬁts US$m T otal US$m At 1 April 2020 1,023 (940) (44) (4) (988) 35 Income statement (charge)/cr edit: Current service cost — (4) — — (4) (4) Administration expenses — (2) — — (2) (2) Interest income/(expense) 23 (21) (1) — (22) 1 T otal (charge)/credit to the Gr oup income statement 23 (27) (1) — (28) (5) Remeasurements: Return on plan assets other than interest 142 — — — — 142 Gains from change in demogr aphic assumptions — 2 — — 2 2 Losses from change in ﬁnancial assumptions — (137) (5) — (142) (142) Remeasurement of post -employment beneﬁt assets and obligations 142 (135) (5) — (140) 2 Dierences on exchange 121 (112) (3) (1) (116) 5 Contributions paid by the Group and employees 11 (1) — — (1) 10 Beneﬁts paid (46) 43 2 1 46 — At 31 March 2021 1,274 (1,172) (51) (4) (1,227) 47 195 Experian plc Annual Report 2021 Financial statements 35. Post -employment beneﬁts – IAS 19 information c ontinued (b) Movements in net post-employment beneﬁt assets/(obligations) r ecognised in the Group balance sheet continued F air value of plan assets US$m Present value of obligations Movements in net position US$m Deﬁned beneﬁt pensions – funded US$m Deﬁned beneﬁt pensions – unfunded US$m Post-employment medical beneﬁts US$m T otal US$m At 1 April 2019 1,122 (1,061) (50) (5) (1,116) 6 Income statement (charge)/cr edit: Current service cost — (6) — — (6) (6) Administration expenses — (2) — — (2) (2) Interest income/(expense) 25 (23) (2) — (25) — T otal (charge)/credit to the Gr oup income statement 25 (31) (2) — (33) (8) Remeasurements: Return on plan assets other than interest (33) — — — — (33) (Losses)/gains from change in demogr aphic assumptions — (13) 1 — (12) (12) Gains from change in ﬁnancial assumptions — 56 2 — 58 58 Experience gains — 12 1 — 13 13 Remeasurement of post -employment beneﬁt assets and obligations (33) 55 4 — 59 26 Dierences on exchange (55) 52 2 — 54 (1) Contributions paid by the Group and employees 13 (1) — — (1) 12 Beneﬁts paid (49) 46 2 1 49 — At 31 March 2020 1,023 (940) (44) (4) (988) 35 (c) Actuarial assumptions and sensitivities The accounting valuations at 31 March 2021 ha ve been based on the most recent actuarial v aluations, updated by Willis T owers Watson to take account of the requir ements of IAS 19. The assumptions for the real discount r ate, pension increases, salary increases and mortality , used to calculate the present value of the deﬁned beneﬁt obligations, all have a signiﬁcant eect on the accounting valuation. Changes to these assumptions in the light of prevailing conditions ma y have a signiﬁcant impact on futur e valuations. Indications of the sensitivity of the amounts reported at 31 Mar ch 2021 to changes in the real discount r ate, pension increases, life expectancy and medical costs ar e included below . While the methodology used to determine the discount rate is unchanged fr om that used at 31 March 2020, the data sour ce used by our external actuary to construct the corporate bond yield curve has been updated due to changes in the classiﬁc ations of relev ant high-quality corporate bonds. In constructing the yield curve, judgment is r equired on the selection of appropriate bonds to be included and the approach then used to derive the yield curve. The change to the bond universe has r educed retir ement beneﬁt obligations at 31 March 2021 by appr oximately US$28m or 2.4%. In the year ended 31 March 2020 the CPI assumption was derived b y assuming a margin of 80 basis points below RPI. F ollowing the announcement by the UK Chancellor of the Exchequer on 25 November 2020, of the outcome of a consultation on the reform to RPI methodology , it is now expected that from 2030 RPI will be aligned with CPIH (the Consumer Price Index including owner occupier s’ housing costs). F or the year ended 31 March 2021, a 100 basis point margin between RPI and CPI has been assumed to 2030, with a ten basis point margin assumed ther eafter . This results in a single equiv alent dierential of 50 basis points and an incr ease in retir ement beneﬁt obligations at 31 March 2021 of appr oximately US$14m or 1.2%. The other methods and types of assumptions used are consistent with those used in the prior year and the absolute sensitivity number s are stated on a basis consistent with the methodology used in determining the accounting valuation as at 31 March 2021. The methodology evaluates the eect of a change in each assumption on the relevant obligations, while holding all other assumptions constant. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 196 35. Post -employment beneﬁts – IAS 19 information c ontinued (i) Financial actuarial assumptions 2021 % 2020 % Discount rate 2.0 2.2 Inﬂation rate – based on the UK R etail Prices Index (the RPI) 3.3 2.6 Inﬂation rate – based on the UK Consumer Prices Index (the CPI) 2.8 1.8 Increase in salaries 2.8 2.1 Increase for pensions in payment – element based on the RPI (wher e cap is 5%) 3.0 2.5 Increase for pensions in payment – element based on the CPI (wher e cap is 2.5%) 1.9 1.5 Increase for pensions in payment – element based on the CPI (wher e cap is 3%) 2.2 1.7 Increase for pensions in deferment 2.8 1.8 Inﬂation in medical costs 6.3 5.6 The principal ﬁnancial assumption is the real discount r ate, which is the excess of the discount rate over the r ate of inﬂation. The discount r ate is based on the market yields on high-quality corpor ate bonds of a currency and term appr opriate to the deﬁned beneﬁt obligations. In the c ase of the Experian Pension Scheme, the obligations ar e in pounds sterling and have a maturity on average of 17 year s. If the r eal discount r ate increased/decr eased by 0.1%, the deﬁned beneﬁt obligations at 31 Mar ch 2021 would decrease/incr ease by approximately US$21m and the fair value of plan assets would decrease/incr ease by appro ximately US$20m. The annual current service cost would be br oadly unchanged. The rates of incr ease for pensions in payment reﬂect the separate arr angements applying to dierent groups of Experian’s pensioners. If the inﬂation rate underlying the pension incr eases (both in payment and in deferment) increased/decreased by 0.1%, the deﬁned beneﬁt obligations at 31 March 2021 would increase/decr ease by appro ximately US$12m and the annual current service cost would be br oadly unchanged. (ii) Mortality assumptions – average life e xpectancy on retirement at age 65 in normal health 2021 years 2020 years For a male curr ently aged 65 22.6 22.5 For a f emale currently aged 65 24.5 24.3 For a male curr ently aged 50 23.5 23.3 For a f emale currently aged 50 25.6 25.4 The accounting valuation assumes that mortality will be in line with standard tables adjusted to r eﬂect the expected experience of the Experian Pension Scheme membership, based on analysis carried out for the 2019 actuarial v aluation. A speciﬁc allow ance for anticipated future impr ovements in life expectancy is also incorporated. While COVID-19 has had an impact on mortality in FY21, the impact on futur e mortality trends is currently unknown and consequently no adjustment has been made to mortality assumptions in this regar d. An incr ease in assumed life expectancy of 0.1 years would increase the deﬁned beneﬁt obligations at 31 March 2021 by appr oximately US$6m and the annual curr ent service cost would remain unchanged. (iii) Post-employment medic al beneﬁts The accounting valuation in respect of post -employment medical beneﬁts assumes a rate of increase f or medical costs. If this rate incr eased/decreased by 1.0% per annum, the obligations at 31 Mar ch 2021 and the ﬁnance expense would remain unchanged. (iv) Increase in salaries An increase of 0.1% to the salary incr ease rate would incr ease the obligations at 31 March 2021 by approximately US$1m, and the annual current service cost would remain unchanged. (d) Assets of the Group’s deﬁned beneﬁt plans at fair value 2021 2020 US$m % US$m % UK equities 7 1 6 1 Overseas equities 208 16 175 17 Index -linked gilts 447 35 362 35 Global corporate bonds 404 32 318 31 Secured cr edit 130 10 105 10 Other unlisted 49 4 37 4 Other 29 2 20 2 1,274 100 1,023 100 The Experian Pension Scheme investment str ategy aims to reduce in vestment risk and funding volatility . With the exception of a target 5% alloc ation to senior private debt, all other assets are r egarded as being r eadily marketable and r egularly traded. The T rustee has adopted funding-based triggers to implement further de-risking of the investment strategy as conditions allo w . As a result, during the year the target alloc ation to equities was reduced fr om 20% to 15%. These triggers will be kept under r eview . Over time, the Scheme is expected to increase its alloc ation to liability matching assets, to pr ovide cash ﬂow s to match expected beneﬁt payments. 197 Experian plc Annual Report 2021 Financial statements 35. Post -employment beneﬁts – IAS 19 information c ontinued (d) Assets of the Group’s deﬁned beneﬁt plans at fair value continued The T rustee believes that environmental, social and governance (ESG) factors may have a material impact on in vestment risk and return outcomes. ESG factors, including climate change and stewardship, are incr easingly integrated within investment processes both in appointing new in vestment managers and in monitoring existing investment managers. Monitoring is undertaken and documented on a regular basis, making use of the in vestment consultant’s ESG rating fr amework. The Group’s deﬁned beneﬁt plans have no holdings of or dinary shares or borrowings of the Company . (e) Futur e contributions There was a small funding deﬁcit at the date of the 2016 full actuarial v aluation of the Experian Pension Scheme. T o correct the shortfall the employ er agreed to pay additional contributions of US$4m per annum over ﬁve y ears from 1 April 2017. The employer has agreed to continue to pay these contributions notwithstanding the small surplus recognised following the 2019 full actuarial v aluation. Contributions, including additional contributions, currently expected to be paid to this plan during the year ending 31 Mar ch 2022 are US$8m by the Group and US$1m by employees. 36. Deferr ed and current tax (a) Deferred tax (i) Net deferred tax assets/(liabilities) 2021 US$m 2020 US$m At 1 April (95) 15 Dierences on exchange 4 2 T ax charge in the Gr oup income statement (note 16(a)) (80) (51) Additions through business combinations (100) (52) T ax recognised within OCI (1) (5) T ax recognised dir ectly in equity on transactions with o wners (3) (4) At 31 March (275) (95) Presented in the Gr oup balance sheet as: Deferred tax assets 86 107 Deferred tax liabilities (361) (202) (275) (95) T ax recognised in Other compr ehensive income is in respect of the remeasurement of post -employment beneﬁt assets and obligations. (ii) Movements in gross deferred tax assets and liabilities Assets Intangibles US$m T ax losses US$m Share incentive plans US$m Accelerated depreciation US$m Other US$m T otal US$m At 1 April 2020 246 94 35 10 215 600 Dierences on exchange (12) (2) 1 1 2 (10) T ax recognised in the Gr oup income statement (8) 16 3 7 (77) (59) T ax recognised within OCI — — — — (1) (1) T ax recognised dir ectly in equity on transactions with owners — — (3) — — (3) T ransfers — — — — 3 3 At 31 March 2021 226 108 36 18 142 530 Assets Intangibles US$m T ax losses US$m Share incentive plans US$m Accelerated depreciation US$m Other US$m T otal US$m At 1 April 2019 327 96 40 11 270 744 Dierences on exchange (81) (2) 1 — (10) (92) T ax recognised in the Gr oup income statement (1) (1) (2) (1) (41) (46) T ax recognised within OCI — — — — (5) (5) T ax recognised dir ectly in equity on transactions with owners — — (4) — — (4) Additions through business combinations — — — — 3 3 T ransfers 1 1 — — (2) — At 31 March 2020 246 94 35 10 215 600 Notes to the Group ﬁnancial statements continued Experian plc Financial statements 198 36. Deferr ed and current tax continued (ii) Movements in gross deferred tax assets and liabilities continued Liabilities Intangibles US$m Accelerated depreciation US$m Other US$m T otal US$m At 1 April 2020 650 24 21 695 Dierences on exchange (14) (2) 2 (14) T ax recognised in the Gr oup income statement 23 2 (4) 21 Additions through business combinations 100 — — 100 T ransfers — 3 — 3 At 31 March 2021 759 27 19 805 Liabilities Intangibles US$m Accelerated depreciation US$m Other US$m T otal US$m At 1 April 2019 699 19 11 729 Dierences on exchange (92) — (2) (94) T ax recognised in the Gr oup income statement (7) 5 7 5 Additions through business combinations 51 — 4 55 T ransfers (1) — 1 — At 31 March 2020 650 24 21 695 These movements do not take into consider ation the osetting of assets and liabilities within the same tax jurisdiction. Items classiﬁed as Other assets in the above analyses pr edominantly relate to futur e tax beneﬁts deferr ed in line with local tax laws. (iii) Other information on deferred tax assets and liabilities As set out in note 5, ther e are a number of critic al judgments in assessing the recognition of deferr ed tax assets. The Group has not r ecognised deferred tax on losses of US$581m (2020: US$480m) that could be utilised against future taxable income or on US$282m (2020: US$331m) in r espect of capital losses that could be utilised against future taxable gains. While these losses ar e available indeﬁnitely , they have arisen in undertakings in which it is not currently anticipated that futur e beneﬁt will be available fr om their use. The capital losses arising on investments ar e available for use within ﬁve years, and future taxable gains against which the c apital losses could be utilised are not curr ently anticipated. There ar e retained earnings of US$8,980m (2020: US$8,933m) in subsidiary undertakings which could be subject to tax if r emitted to Experian plc. No deferred tax liability has been r ecognised on these earnings because the Gr oup is in a position to control the timing of the r eversal of the tempor ary dierence and it is pr obable that such dierences will not r everse in the for eseeable future. Given the mix of countries and tax rates, it is not pr acticable to determine the impact of such remittance. During the current year the main r ate of UK corporation tax was 19% (2020: 19%). (b) Net current tax assets/(liabilities) 2021 US$m 2020 US$m At 1 April (197) (286) Dierences on exchange (1) 7 T ax charge in the Gr oup income statement (note 16(a)) (195) (212) Additions through business combinations 10 (1) T ax recognised dir ectly in equity on transactions with o wners 5 9 Other tax paid 236 286 At 31 March (142) (197) Presented in the Gr oup balance sheet as: Current tax assets 34 28 Current tax liabilities (176) (225) (142) (197) T ax recognised dir ectly in equity on transactions with owners relates to employ ee share incentive plans. 199 Experian plc Annual Report 2021 Financial statements 37. Pr ovisions 2021 2020 North America legal claims US$m North America security incident costs US$m Other liabilities US$m T otal US$m North America legal claims US$m North America security incident costs US$m Other liabilities US$m T otal US$m At 1 April 30 — 18 48 5 12 24 41 Dierences on exchange — — (2) (2) — — (7) (7) Amount charged in the year — 8 5 13 30 — 6 36 Utilised (28) — (4) (32) (5) (12) (5) (22) At 31 March 2 8 17 27 30 — 18 48 Legal claims repr esent a number of related legal claims arising in North Americ a. In September 2015, Experian North Americ a suered an unauthorised intrusion to its Decision Analytics computing envir onment that allowed unauthorised acquisition of certain data belonging to a client, T -Mobile USA, Inc. W e notiﬁed the individuals who may have been aected and oered free credit monitoring and identity theft r esolution services. In addition, government agencies were notiﬁed as requir ed by law . We ha ve one remaining claim in r espect of the incident and are working with the government bodies in volved in this remaining claim, in connection with this we have pro vided US$8m in the year . It is curr ently dicult to predict the r esult, including the timing and scale, but we do not believe the outcome will be material to the Group. In the event of an unfavourable outcome, the Gr oup may beneﬁt from applicable insur ance recoveries. Other liabilities principally comprise liabilities of Serasa S.A., in connection with local legal and tax issues, which were primarily recognised on its acquisition in 2007. 38. Called-up shar e capital and share pr emium acc ount At 31 March 2021, there were 969.6m shares in issue (2020: 968.7m). During the year ended 31 March 2021, 0.9m (2020: 0.9m) shar es were issued and no (2020: 3.6m) shares wer e cancelled. F urther information on share c apital is contained in note P to the Company ﬁnancial statements. The dierence between the amounts shown in the Gr oup and Company ﬁnancial statements in r espect of called-up share c apital and the share premium account ar ose due to translation of pound sterling amounts into the US dollar at v arious exchange r ates on various tr anslation dates. 39. R etained earnings and other reserv es (a) Retained earnings Retained earnings comprise net proﬁts r etained in the Group after the payment of equity dividends. Ther e are no signiﬁcant statutory , contr actual or exchange control r estrictions on distributions by Group undertakings. (b) Other reserves (i) Movements in reserves Merger reserve US$m Hedging reserve US$m T ranslation reserve US$m Own shares reserve US$m T otal other reserves US$m At 1 April 2020 (15,682) 11 (1,367) (1,183) (18,221) Shares deliver ed as consideration f or acquisition — — — 90 90 Other vesting of awards and exer cises of share options — — — 87 87 Change in the fair value of hedging instruments recognised in OCI — 35 — — 35 Amounts reclassiﬁed fr om OCI to the Group income statement — (33) — — (33) Currency tr anslation gains — — 64 — 64 At 31 March 2021 (15,682) 13 (1,303) (1,006) (17,978) Merger reserve US$m Hedging reserve US$m T ranslation reserve US$m Own shares reserve US$m T otal other reserves US$m At 1 April 2019 (15,682) 11 (1,055) (1,167) (17,893) Purchase of shar es by employee trusts — — — (92) (92) Other vesting of awards and exer cises of share options — — — 76 76 Currency tr anslation losses — — (312) — (312) At 31 March 2020 (15,682) 11 (1,367) (1,183) (18,221) Notes to the Group ﬁnancial statements continued Experian plc Financial statements 200 39. R etained earnings and other reserv es c ontinued (ii) Nature of reserves The merger r eserve arose on the demer ger from GUS plc in 2006 and is the dier ence between the share capital and share pr emium of GUS plc and the nominal value of the share c apital of the Company befor e a share oer at that date. Movements on the hedging reserve and the position at the balance sheet date r eﬂect hedging transactions, originating fr om the management of foreign exchange risk, which ar e not charged or credited to the Group income statement, net of related tax. Movements on the tr anslation reserve and the position at the balance sheet date r eﬂect foreign curr ency translations since 1 April 2004 which are not charged or cr edited to the Group income statement, net of related tax. The movement in the y ear ended 31 March 2021 comprises curr ency tr anslation gains of US$64m (2020: losses of US$312m) recognised dir ectly in Other comprehensive income. The balance on the own shares r eserve is the cost of ordinary shar es in the Company and further details are given in note 39(b)(iii). The dierence between the amounts shown in the Group and Company ﬁnancial statements in r espect of this reserve arose due to tr anslation of pound sterling amounts into US dollars at dierent ex change rates on dier ent tr anslation dates. (iii) Movements in own shares held and own shares r eserve Number of own shares held Cost of own shares held T reasury million T rusts million T otal million T reasury US$m T rusts US$m T otal US$m At 1 April 2020 60 8 68 973 210 1,183 Shares deliver ed as consideration f or acquisition (7) — (7) (90) — (90) Other vesting of awards and exer cises of shareoptions (1) (4) (5) (12) (75) (87) At 31 March 2021 52 4 56 871 135 1,006 Number of own shares held Cost of own shares held T reasury million T rusts million T otal million T reasury US$m T rusts US$m T otal US$m At 1 April 2019 61 9 70 985 182 1,167 Purchase of shar es by employee trusts — 3 3 — 92 92 Other vesting of awards and exer cises of shareoptions (1) (4) (5) (12) (64) (76) At 31 March 2020 60 8 68 973 210 1,183 40. Notes to the Gr oup cash ﬂow statement (a) Cash generated fr om operations Notes 2021 US$m 2020 US$m Proﬁt befor e tax 1,077 942 Share of post -tax proﬁt of associates (21) (14) Net ﬁnance costs 127 257 Operating pr oﬁt 1,183 1,185 Loss/(proﬁt) on disposal of ﬁxed assets 3 (1) Proﬁt on disposal of investment in associate 14(b), 23 (120) — Impairment of goodwill 20(a), 20(d) 53 — Impairment of other intangible assets 21 33 — Impairment of property , plant and equipment 22 4 — Amortisation and depreciation  12 591 537 Charge in r espect of share incentive plans 33(a) 106 83 Increase in working capital 40(b) (13) (112) Acquisition expenses – dierence between income statement char ge and amount paid (9) 6 F air value gain on revaluation of step acquisition — (17) Adjustment to the fair value of contingent consider ation 1 (4) Movement in Exceptional and other non-benchmark items included in working capital (10) 17 Cash generated from oper ations 1,822 1,694 1 Amortisation and depreciation includes amortisation of acquisition intangibles of US$138m (2020: US$124m) which is excluded from Benchmark PBT . 201 Experian plc Annual Report 2021 Financial statements 40. Notes to the Gr oup cash ﬂow statement continued (b) Increase in working c apital 2021 US$m 2020 US$m T rade and other receivables (31) (145) T rade and other payables 18 33 Increase in working capital (13) (112) (c) Purchase of other intangible assets 2021 US$m 2020 US$m Databases 147 175 Internally generated softwar e 197 189 Internal use software 30 39 Purchase of other intangible assets 374 403 (d) Cash ﬂows on acquisitions (non-G AAP measure) 2021 US$m 2020 US$m Purchase of subsidiaries (note 41(a)) 568 601 Less: net cash acquired with subsidiaries (47) (26) Settlement of deferred and contingent consider ation 5 25 As reported in the Gr oup cash ﬂow statement 526 600 Acquisition expenses paid 47 33 T ransactions in respect of non-contr olling interests 10 67 Cash outﬂow for acquisitions (non-GAAP measur e) 583 700 (e) Cash (inﬂow)/outﬂow in respect of net share pur chases (non-G AAP measure) 2021 US$m 2020 US$m Issue of ordinary shar es (19) (15) Purchase of shar es by employee trusts — 92 Purchase and cancellation of o wn shares — 111 Cash (inﬂow)/outﬂow in respect of net share purchases (non-G AAP measure) (19) 188 As reported in the Gr oup cash ﬂow statement: Cash inﬂow in respect of shar es issued (19) (15) Cash outﬂow in respect of shar e purchases — 203 Cash (inﬂow)/outﬂow in respect of net share purchases (non-G AAP measure) (19) 188 (f) Analysis of c ash and cash equiv alents 2021 US$m 2020 US$m Cash and cash equivalents in the Gr oup balance sheet 180 277 Bank overdr afts (10) (5) Cash and cash equivalents in the Group c ash ﬂow statement 170 272 (g) Reconciliation of Cash gener ated from oper ations to Benchmark operating c ash ﬂow (non-GAAP measure) Notes 2021 US$m 2020 US$m Cash generated fr om oper ations 40(a) 1,822 1,694 Purchase of other intangible assets 40(c) (374) (403) Purchase of pr operty , plant and equipment (48) (84) Sale of property , plant and equipment 1 5 Payment of lease liabilities (56) (55) Acquisition expenses paid 47 33 Dividends received fr om associates 17 6 Cash ﬂows in respect of Exceptional and other non-benchmark items 67 18 Benchmark operating c ash ﬂow (non-GAAP measur e) 1,476 1,214 Benchmark free c ash ﬂow for the year ended 31 March 2021, as set out in the Financial review within the Strategic r eport, w as US$1,124m (2020: US$774m). Cash ﬂow con version for the year ended 31 Mar ch 2021 was 106% (2020: 88%). Notes to the Group ﬁnancial statements continued Experian plc Financial statements 202 41. A cquisitions (a) Acquisitions in the year The Group made seven acquisitions during the year ended 31 Mar ch 2021, including the acquisition of a 60% stake in the Risk Management division of Arvato Financial Solutions (AFS) which completed on 30 June 2020. This investment enables us to expand our r ange of risk, anti-fraud and identity management services across Germany , Austria and Switzerland. The consider ation was satisﬁed by the delivery of 7.2m Experian plc treasury shar es at market value. There ar e put and call options associated with the shar es held by the remaining shar eholders of the Risk Management division of Arvato Financial Solutions, and these ﬁr st become exercisable in January 2026. Accordingly , a provisional amount in r espect of the present value of the put options of US$201m has been recognised as a non-curr ent ﬁnancial liability . On 19 November 2020 we acquired the whole of the issued shar e capital of T apad, Inc. (T apad) a leader in resolution of digital online identities, and on 23 March 2021, we acquired the whole of the issued shar e capital of BrScan Processamento de Dados e T ecnologia Ltda, (BrScan), a market leader in F raud and Identity solutions in Brazil. In total provisional goodwill of US$657m was r ecognised based on the fair value of the net assets acquired of US$416m. Arvato Risk Management US$m T apad US$m BrScan US$m Other US$m T otal US$m Intangible assets: Customer and other relationships 149 156 31 50 386 Software development 14 16 12 15 57 Marketing-related acquisition intangibles 5 3 1 2 11 Other non-acquisition intangibles 11 7 — 9 27 Intangible assets 179 182 44 76 481 Property , plant and equipment 3 1 1 — 5 T rade and other receivables 15 16 4 16 51 Current tax assets 10 — — — 10 Cash and cash equivalents (note 40(d)) 1 18 — 28 47 T rade and other payables (22) (24) (5) (12) (63) Borrowings — — — (15) (15) Deferred tax liabilities (55) (13) (15) (17) (100) T otal identiﬁable net assets 131 180 29 76 416 Goodwill 323 110 103 121 657 T otal 454 290 132 197 1,073 Satisﬁed by: Cash and cash equivalents (note 40(d)) — 290 106 172 568 Experian plc shares 253 — — — 253 Put options 201 — — 7 208 Recognition of non-controlling inter est — — — 4 4 Deferred consider ation — — — 7 7 Contingent consideration — — 26 7 33 T otal 454 290 132 197 1,073 These provisional fair v alues are determined by using established estimation techniques such as discounted c ash ﬂow and option valuation models; the most signiﬁcant assumption being the r etention rates for customer s. Pr ovisional fair values contain amounts which will be ﬁnalised no later than one year after the date of acquisition. Provisional amounts, predominantly for intangible assets and associated tax balances, have been included at 31 Mar ch 2021, as a consequence of the timing and complexity of the acquisitions. Goodwill represents the syner gies, assembled workfor ces and future growth potential of the acquired businesses. None of the goodwill arising in the period of US$657m is currently deductible f or tax purposes. However , in the near future we expect to undertake a mer ger of BrScan into Serasa S.A. which we anticipate will cr eate a separate tax deductible goodwill balance within that company . Goodwill for Arvato Risk Management has incr eased by US$141m, since we r eported the provisional amount at 30 September 2020, as a r esult of adopting the assumed acquisition method of accounting for this non-controlling inter est. Other includes adjustments to prior year acquisition provisional amounts, including a US$9m adjustment to the fair value of customer and other relationships of Auto I.D ., Inc. acquired in the year ended 31 March 2020. 203 Experian plc Annual Report 2021 Financial statements 41. A cquisitions continued (b) Additional information (i) Current year acquisitions Arvato Risk Management US$m T apad US$m BrScan US$m Other US$m T otal US$m Increase/(decr ease) in book value from fair v alue adjustments: Intangible assets 172 175 44 67 458 T rade and other payables (2) (7) (3) (1) (13) Deferred tax liabilities (50) (13) (15) (17) (95) Increase in book value from fair value adjustments 120 155 26 49 350 Gross contr actual amounts receiv able in respect of tr ade and otherreceiv ables 10 16 3 11 40 Pro-forma r evenue from 1 April 2020 to date of acquisition 36 35 23 35 129 Revenue from date of acquisition to 31 Mar ch 2021 78 22 — 17 117 Proﬁt befor e tax from date of acquisition to 31 Mar ch 2021 15 7 — 2 24 At the dates of acquisition, the gr oss contractual amounts receivable in r espect of trade and other receivables of US$40m wer e expected to be collected in full. If the transactions had occurr ed on the ﬁrst day of the ﬁnancial year , the estimated additional contribution to proﬁt befor e tax would have been US$28m. (ii) Prior year acquisitions Deferred consider ation of US$5m (2020: US$25m) was settled in the year in respect of acquisitions made in earlier years. These cash ﬂo ws principally relate to the acquisitions of Runpath Gr oup Limited and Clarity Services, Inc. acquired in the year ended 31 March 2018. The Group made eight acquisitions in the year ended 31 March 2020 which included the acquisition of the whole of the issued shar e capital of Compuscan (CSH Group (Pty) Limited) and Auto I.D., Inc. A cash outﬂow of US$575m was reported in the Gr oup cash ﬂow statement for that year , after deduction of US$26m in respect of net c ash acquired. (iii) Post balance sheet acquisitions On 9 April 2021 the Group completed the acquisition of the entir e share c apital of Employment T ax Servicing, LLC for US$52m including deferr ed consideration of US$4m, and on 13 April 2021 we completed the acquisition of the entire share capital of T ax Credit Co., LLC for a cash consider ation of US$250m and contingent consideration of up to US$110m. Both acquisitions will bolster our income veriﬁcation business in North America. 42. Capital c ommitments 2021 US$m 2020 US$m Capital expenditure for which contr acts have been placed: Other intangible assets 6 2 Property , plant and equipment 10 23 16 25 Capital commitments at 31 March 2021 included US$1m (2020: US$7m) in r espect of right-of-use assets. All commitments at 31 March 2021 and 31 March 2020 wer e expected to be incurred befor e 31 March 2022 and 31 March 2021 respectiv ely . Ther e were no material leases committed to that had not yet started at 31 March 2021 or 31 Mar ch 2020. Notes to the Group ﬁnancial statements continued Experian plc Financial statements 204 43. Contingencies (a) Latin America tax As previously indic ated, Ser asa S.A . has been advised that the Br azilian tax authorities are challenging the deduction for tax purposes of goodwill amortisation arising from its acquisition by Experian in 2007. The Brazilian courts have ultimately upheld Experian’s position in r espect of the tax years from 2007 to 2011 with no further right of appeal. The Br azilian tax authorities have r aised similar assessments in respect of the 2012 to 2016 tax y ears, in which approximatel y US$135m was claimed, and may r aise similar claims in respect of other years. The possibility of this resulting in a liability to the Group is consider ed to be remote, on the basis of the advice of external legal counsel, success in cases to date and other factors in r espect of the claim. We note that a similar challenge has been r aised in Colombia in respect of the 2014 and 2016 tax years, in which approximatel y US$4m was claimed, and similar claims in respect of other year s may be raised. We ar e contesting these on the basis of external legal advice. (b) UK marketing services regulation We ha ve received a ﬁnal enfor cement notice from the UK Inf ormation Commissioner’s Oce (ICO) with respect to a 2018 audit of several companies on the use of data for marketing purposes under the EU Gener al Data Protection R egulation (GDPR), which r elates to our marketing services activities in the UK. W e disagree with the ICO’s decision and have appealed, during which time all requirements will be stayed. At this stage we do not know what the ﬁnal outcome will be, but it may r equire signiﬁcant changes to business processes in our UK mark eting services business. This business repr esents approximatel y 1% of our global revenues and we do not expect this to r esult in a materially adverse ﬁnancial outcome for the Gr oup. (c) Other litigation and claims There continue to be an incr easing number of pending and threatened litigation, regulatory and other claims involving the Group acr oss all its major geographies which ar e being vigorously defended. The dir ectors do not believe that the outcome of any such claims will have a materially adverse eect on the Group’s ﬁnancial position. However , as is inherent in legal, regulatory and administr ative proceedings, ther e is a risk of outcomes that may be unfavour able to the Group. In the case of unfavour able outcomes, the Group may beneﬁt fr om applicable insur ance recoveries. 44. R elated party tr ansactions (a) Related undertakings A full list of the Company’s related undertakings, including subsidiary and associate undertakings, is given in note S to the Company ﬁnancial statements. There ar e no signiﬁcant non-contr olling interests. (b) T ransactions with associates F ollowing the divestment of CCM in the year ended 31 March 2018 the Gr oup owns 23.1% of the issued share capital of V ector CM Holdings (Cayman), L.P . (V ector). The Group r ecorded the following tr ansactions and balances with V ector and its subsidiaries: T ransaction amount Y ear ended 31 March Balance owed to Experian At 31 March 2021 US$m 2020 US$m 2021 US$m 2020 US$m Promissory note and accrued inter est 8 7 102 94 Net amounts collected/(settled) and receivable — — 1 2 The promissory note is due and payable to Experian on 31 May 2024 with inter est also payable on this date. During the year ended 31 Mar ch 2021, we ceased processing tr ansactions on behalf of V ector and no amounts were received or paid. In the year ended 31 March 2020 c ash of US$2m was received and US$2m was paid on behalf of Vector . W e did not receive any margin on individual tr ansactions. T ransactions with associates are made on normal market terms and in the y ear ended 31 March 2021 comprised the pr ovision and receipt of services to other associates of US$3m (2020: US$1m) and US$12m (2020: US$9m) respectively . At 31 March 2021, amounts owed by associates, other than V ector , were US$nil (2020: US$nil) and amounts due to associates, other than V ector were US$nil (2020: US$1m). 205 Experian plc Annual Report 2021 Financial statements 44. R elated party tr ansactions continued (c) T ransactions with other related undertakings The Group tr ansacts with a number of related undertakings in connection with the operation of its shar e incentive plans, pension arr angements in the UK, the USA, Brazil, South Afric a and Germany , and the pr ovision of medical cover in the UK. These undertakings are listed in note S(v) to the Company ﬁnancial statements. T ransactional relationships c an be summarised as follows: The assets, liabilities and expenses of the Experian UK Appr oved All-Emplo yee Share Plan and The Experian plc Employee Share T rust are included in these ﬁnancial statements. During the year ended 31 March 2021, US$57m (2020: US$57m) was paid by the Group to related undertakings, in connection with the provision of post-employment pensions beneﬁts in the UK, the USA, Br azil and South Africa and US$3m (2020: US$3m) was paid by the Group to Experian Medical Plan Limited, in connection with the pr ovision of healthcar e beneﬁts. There wer e no other material transactions or balances with these r elated undertakings during the current or prior year . (d) Remuner ation of key management per sonnel 2021 US$m 2020 US$m Salaries and short-term employee beneﬁts 10 10 Share incentive plans 11 11 Pension payments — 1 21 22 Key management personnel comprises the Company’s executive and non-e xecutive directors and further details of their r emuneration are given in the audited parts of the Report on director s’ remuner ation. There wer e no other material tr ansactions with the Group in which the key management personnel had a personal inter est, in either the curr ent or prior year . 45. E vents occurring after the end of the r eporting period Details of the second interim dividend announced since the end of the reporting period ar e given in note 19. We completed the acquisitions of Employment T ax Servicing, LL C and T ax Cr edit Co., LL C on 9 April 2021 and 13 April 2021 respectively . F urther details are pr ovided in note 41(b)(iii). Experian plc Financial statements 206 Company proﬁt and loss account for the year ended 31 March 2021 Company statement of comprehensiv e income for the year ended 31 March 2021 Company balance sheet at 31 March 2021 Notes 2021 US$m 2020 US$m Other operating income F 70.2 79.2 Sta costs G (3.9) (3.8) Depreciation M (0.3) (0.2) Other operating expenses F (65.1) (91.3) Operating proﬁt/(loss) 0.9 (16.1) Interest r eceivable and similar income H 81.5 82.9 Interest payable and similar expenses I (0.3) (0.2) Dividend income from subsidiary undertakings L 100.0 197.1 Proﬁt before tax 182.1 263.7 T ax on proﬁt J (20.8) (16.5) Proﬁt after tax and for the ﬁnancial year 161.3 247.2 The Company has no recognised items of income and expenditur e other than those included in the proﬁt and loss account. T otal compr ehensive income for the ﬁnancial year is theref ore equal to the pr oﬁt for the ﬁnancial year . Notes 2021 US$m 2020 US$m Fixed assets Investments – shares in Gr oup undertakings L 17,919.5 17,413.2 Right-of-use assets M 2.7 3.0 Deferred tax assets J 15.6 36.4 17,937.8 17,452.6 Current assets Debtors – amounts falling due within one year N 1,761.2 1,728.7 Cash at bank and in hand 0.4 0.3 Current liabilities Creditors – amounts falling due within one y ear O (1.1) (1.4) Net current assets 1,760.5 1,727.6 T otal assets less current liabilities 19,698.3 19,180.2 Creditors – amounts falling due after mor e than one year O (2.9) (2.9) Net assets 19,695.4 19,177.3 Equity Called-up share capital P 73.0 72.9 Share pr emium account P 1,425.7 1,243.6 Proﬁt and loss account r eserve Q 18,196.7 17,860.8 T otal shareholders’ funds 19,695.4 19,177.3 These ﬁnancial statements were appr oved by the Boar d on 18 May 2021 and were signed on its behalf by: Kerry Williams Director 207 Experian plc Annual Report 2021 Financial statements Company statement of changes in equity for the year ended 31 March 2021 Called-up share capital (Note P) US$m Share premium account (Note P) US$m Proﬁt and loss account reserve T otal equity US$m Proﬁt and loss account US$m Own shares reserve US$m T otal (Note Q) US$m At 1 April 2020 72.9 1,243.6 19,012.4 (1,151.6) 17,860.8 19,177.3 Proﬁt and T otal comprehensiv e income for the ﬁnancial year — — 161.3 — 161.3 161.3 T ransactions with owner s: Employee share incentive plans: – value of employee services — — 106.3 — 106.3 106.3 – shares issued on vesting 0.1 19.3 — — — 19.4 – other vesting of awards and exercises of shareoptions — — (87.3) 87.3 — — Shares deliver ed as consideration f or acquisition — 162.8 — 90.0 90.0 252.8 Dividends paid — — (21.7) — (21.7) (21.7) T ransactions with owner s 0.1 182.1 (2.7) 177.3 174.6 356.8 At 31 March 2021 73.0 1,425.7 19,171.0 (974.3) 18,196.7 19,695.4 Called-up share capital (Note P) US$m Share premium account (Note P) US$m Proﬁt and loss account r eserve T otal equity US$m Proﬁt and loss account US$m Own shares reserve US$m T otal (Note Q) US$m At 1 April 2019 73.1 1,229.1 18,892.8 (1,136.5) 17,756.3 19,058.5 Proﬁt and T otal compr ehensive income for the ﬁnancialyear — — 247.2 — 247.2 247.2 T ransactions with owners: Employee share incentive plans: – value of employee services — — 83.0 — 83.0 83.0 – shares issued on vesting 0.1 14.5 — — — 14.6 – purchase of shar es by employee trusts — — — (91.5) (91.5) (91.5) – other vesting of awards and exercises of shareoptions — — (76.7) 76.4 (0.3) (0.3) Purchase and cancellation of o wn shares (0.3) — (111.9) — (111.9) (112.2) Dividends paid — — (22.0) — (22.0) (22.0) T ransactions with owners (0.2) 14.5 (127.6) (15.1) (142.7) (128.4) At 31 March 2020 72.9 1,243.6 19,012.4 (1,151.6) 17,860.8 19,177.3 Experian plc Financial statements 208 Notes to the Company ﬁnancial statements for the year ended 31 March 2 02 1 A. Corpor ate information Corporate information f or Experian plc (the Company) is set out in note 1 to the Group ﬁnancial statements, with further information given in the Strategic r eport and the Corporate governance report. B. Basis of pr eparation The separate ﬁnancial statements of the Compan y are pr esented voluntarily and are: prepar ed on the going concern basis under the historical cost convention and in accordance with UK accounting standar ds; presented in US dollars, the Company’s functional currency; and designed to include disclosures in line with those r equired by those parts of the UK Companies Act 2006 applicable to companies r eporting under UK accounting standards even though the Company is incorporated and r egistered in Jersey . The directors opted to pr epare the ﬁnancial statements for the year ended 31 March 2021 in accor dance with FRS 101 ‘Reduced Disclosure Fr amework’ . The Compan y intends to continue to use this accounting framework until further notice. Going concern In adopting the going concern basis for preparing these ﬁnancial statements, the dir ectors have consider ed the business activities, the principal risks and uncertainties and the other matters that could thr eaten the long-term ﬁnancial stability of the Company . The directors believe that the Compan y is well placed to manage its ﬁnancing and other business risks satisfactorily , and ha ve a reasonable expectation that the Company will have adequate r esources to continue in operational existence f or at least 12 months from the date of signing these ﬁnancial statements. The directors ther efore consider it appropriate to adopt the going concern basis of accounting in preparing the Company ﬁnancial statements. C. FRS 101 e xemptions FRS 101 allows certain exemptions fr om the requir ements of IFRS to avoid the duplication of information pr ovided in the Group ﬁnancial statements and to provide mor e concise ﬁnancial reporting in entity ﬁnancial statements. The following exemptions have ther efore been applied in the prepar ation of these ﬁnancial statements: Par agr aphs 45(b) and 46 to 52 of IFRS 2 ‘Share-based P ayment’ , exempting the Company fr om providing details of shar e options and of how the fair value of services r eceived was determined. IFRS 7 ‘Financial instruments: Disclosures’ . Par agr aphs 91 to 99 of IFRS 13 ‘F air V alue Measurement’ , exempting the Company from disclosing v aluation techniques and inputs used for the measurement of assets and liabilities. Par agr aph 38 of IAS 1 ‘Presentation of Financial Statements’ , exempting the Company fr om disclosing comparative information requir ed by: – paragraph 79(a)(iv) of IAS 1 – shar es outstanding at the beginning and at the end of the period; and – paragraph 73(e) of IAS 16 ‘Pr operty , Plant and Equipment’ – reconciliations between the c arrying amount at the beginning and end of the period. The following paragr aphs of IAS 1: – paragraphs 10(d) and 111, exempting the Company from providing a cash ﬂow statement and information; – paragraph 16, exempting the Company from providing a statement of compliance with all IFRS; – paragraph 38A, exempting the Company fr om the requir ement for a minimum of two of each primary statement and the related notes; – paragraphs 38B to D , exempting the Company from the r equirement to provide additional compar ative information; and – paragraphs 134 to 136, exempting the Company from presenting capital management disclosur es. IAS 7 ‘Statement of Cash Flows’ . Par agr aphs 30 and 31 of IAS 8 ‘Accounting Policies, Changes in Accounting Estimates and Errors’ , exempting the Company fr om disclosing information where it has not applied a new IFRS which has been issued but is not yet eective. Par agr aph 17 of IAS 24 ‘Related Party Disclosur es’ , exempting the Company from disclosing details of k ey management compensation. The requir ements in IAS 24 to disclose related party tr ansactions with wholly-owned members of the Gr oup. The use of critical accounting estimates and management judgment is requir ed in applying the accounting policies. Ar eas involving a higher degree of judgment or complexity , or where assumptions and estimates are signiﬁc ant to the Company ﬁnancial statements, ar e highlighted in note E. D. Signiﬁcant ac counting policies The signiﬁcant accounting policies applied ar e summarised below . They have been consistently applied to both years pr esented. The explanations of these policies focus on areas wher e judgment is applied or which are particularly important in the ﬁnancial statements. Content fr om accounting standards, amendments and interpretations is ex cluded where ther e is simply no policy choice under UK accounting standards. (i) F oreign currency T ransactions in foreign curr encies are r ecorded at the exchange rate prevailing at the tr ansaction date. Monetary assets and liabilities denominated in foreign curr encies are r etranslated at the exchange rate prevailing at the balance sheet date. All dierences are taken to the pr oﬁt and loss account in the year in which they arise. (ii) Investments – shares in Gr oup undertakings Investments in Group undertakings ar e stated at cost less any provisions for impairment. The fair value of shar e incentives issued by the Company to employees of Group undertakings is accounted f or as a capital contribution and recognised as an incr ease in the Company’s investment in Group undertakings, with a corresponding incr ease in equity . (iii) Debtors and creditor s Debtors are initially r ecognised at fair value and subsequently measured at this value. Wher e the time value of money is material, they are then carried at amortised cost using the eective inter est method. Cr editors are initially r ecognised at fair value. Wher e the time value of money is material, they ar e then carried at amortised cost using the eective interest method. 209 Experian plc Annual Report 2021 Financial statements D. Signiﬁcant ac counting policies c ontinued (iv) Cash at bank and in hand Cash at bank includes deposits held at call with banks and other short-term highly liquid investments. (v) Accounting for derivative ﬁnancial instruments The Company uses forwar d foreign exchange contr acts to manage its exposures to ﬂuctuations in for eign exchange rates. The interest dierential r eﬂected in forward f oreign exchange contr acts is taken to interest r eceivable and similar income or inter est payable and similar expenses. F orward foreign ex change contracts ar e recognised at fair value, based on forward for eign exchange market rates at the balance sheet date. Gains or losses on forwar d foreign exchange contracts ar e taken to the proﬁt and loss account in the y ear in which they arise. (vi) Leases The Company undertakes an assessment of whether a contr act is or contains a lease at its inception. The assessment establishes whether the Company obtains substantially all the economic beneﬁts from the use of an asset and whether it has the right to direct its use. Low-v alue lease payments are r ecognised as an expense, on a straight -line basis over the lease term. F or other leases the Company recognises both a right -of-use asset and a lease liability at the commencement date of a lease contract. The right-of-use asset is initially measur ed at cost, comprising the initial amount of the lease liability adjusted for payments made at or before the commencement date, plus initial dir ect costs and an estimate of the cost of any obligation to refurbish the asset or site, less lease incentives. Subsequently , right-of -use assets are measur ed at cost less accumulated depreciation and impairment losses and ar e adjusted for any remeasur ement of the lease liability . Depr eciation is calculated on a straight -line basis over the shorter of the estimated useful life of the right-of-use asset and the period of the lease. The lease term comprises the non-cancellable period of a lease, plus periods covered by an extension option, if it is reasonably certain to be exercised, and periods covered by a termination option if it is reasonably certain not to be exercised. The lease liability is initially measured at the pr esent value of lease payments that are outstanding at the commencement date, discounted at the interest r ate implicit in the lease or if that rate cannot be easily determined the Company’s incremental borr owing rate. Lease payments comprise payments of ﬁxed principal less any lease incentives. The lease liability is remeasur ed when there is a change in futur e lease payments arising from a change in an index or r ate, or if the Company changes its assessment of whether it will exercise an extension or termination option. When a lease liability is remeasur ed, a corr esponding adjustment is made to the carrying amount of the right-of -use asset or is recognised in the Company proﬁt and loss account if the asset is fully depr eciated. (vii) T ax Current tax is c alculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in Ireland, where the Company is resident. Deferred tax is pr ovided in r espect of temporary dier ences that have originated but not reversed at the balance sheet date and is determined using the tax rates that ar e expected to apply when the temporary dierences r everse. Deferred tax assets ar e recognised only to the extent that they are expected to be r ecover able. (viii) Own shares The Group has a number of equity -settled, shar e-based employee incentive plans. In connection with these, shares in the Company are held by The Experian plc Employee Shar e T rust and the Experian UK Approved All-Employee Shar e Plan. The assets, liabilities and expenses of these separately administer ed trusts are included in the ﬁnancial statements as if they were the Company’s own. The trusts’ assets mainly comprise Experian shares, which are shown as a deduction fr om total shareholders’ funds at cost. Experian shares pur chased and held as treasury shar es, in connection with the above plans and any shar e purchase pr ogramme, are also shown as a deduction from total shar eholders’ funds at cost. The par value of shares that ar e purchased and c ancelled, in connection with an y share purchase pr ogramme, is accounted for as a reduction in called-up shar e capital with any cost in excess of that amount being deducted fr om the proﬁt and loss account. The Company is not r equired to r ecognise the par value of cancelled shar es in a capital r edemption reserve. Contractual obligations to pur chase own shares are recognised at the net present value of e xpected future payments. Gains and losses in connection with such obligations are r ecognised in the proﬁt and loss account. Gains and losses which arise on ﬁnancial instruments cr eated by advance instructions to tr ade in own shares ar e recognised dir ectly in equity . (ix) Proﬁt and loss account format Income and expenses, which ar e recognised on an accruals basis, ar e reported by natur e in the proﬁt and loss account, as this reﬂects the composition of the Company’s income and cost base. (x) Dividend income Dividend income is recognised in the Company pr oﬁt and loss account on the date on which the Company’s right to receive payment is established. Liquidation dividends are tr eated as a return of c apital to the extent they are used to r ecover the carrying v alue of the investment in the liquidated entity . Any amount r eceived in excess of the investment v alue is treated as income in the Company proﬁt and loss account. Experian plc Financial statements 210 Notes to the Company ﬁnancial statements contin ued E. Critic al acc ounting estimates, assumptions and judgments (i) Critical accounting estimates and assumptions In preparing the ﬁnancial statements, management is requir ed to make estimates and assumptions that aect the reported amount of income, costs and charges, assets and liabilities and the disclosure of contingent liabilities. The resulting accounting estimates, which ar e based on management’s best judgment at the date of the ﬁnancial statements will, by deﬁnition, seldom equal the related actual results. The most signiﬁcant of these estimates and assumptions for the Company that has a signiﬁc ant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next ﬁnancial year is in respect of the c arrying value of investments in subsidiary undertakings. (ii) Critical judgments In applying the Company’s accounting policies, management may make judgments that have a signiﬁc ant eect on the amounts recognised in the Company ﬁnancial statements. These judgments may include the classiﬁcation of tr ansactions between the Company proﬁt and loss account and the Company balance sheet. The most signiﬁcant of these judgments for the Company is in r espect of contingencies where, in the case of pending and threatened litigation claims, management has formed a judgment as to the likelihood of ultimate liability . No liability has been r ecognised where the likelihood of any loss arising is possible rather than pr obable. F . Other oper ating income and e xpenses Other operating income and expenses principally comprise char ges to and from other Group undertakings in r espect of Group management services and guarantees pr ovided during the year . The reduction in other oper ating expenses in the year ended 31 March 2021 compared to the prior y ear is due to the timing of invoicing. Other operating expenses include a fee of US$0.1m (2020: US$0.1m) pa yable to the Company’s auditor and its associates for the audit of the Company ﬁnancial statements. G. Sta costs 2021 US$m 2020 US$m Directors’ fees 2.3 2.3 Wages and salaries 1.3 1.3 Social security costs 0.1 0.1 Other pension costs 0.2 0.1 3.9 3.8 Executive director s of the Company are employ ed by other Group undertakings and details of their r emuneration, together with that of the non-executive directors, are given in the audited part of the Report on director s’ remuner ation. The Company had thr ee employees in the year ended 31 Mar ch 2021 and two employees throughout the prior y ear . H. Inter est receivable and similar inc ome 2021 US$m 2020 US$m Interest r eceivable on amounts owed by subsidiary undertakings 81.5 81.8 For eign exchange gains — 1.1 81.5 82.9 I. Inter est payable and similar expenses 2021 US$m 2020 US$m Interest payable on lease obligation 0.2 0.2 For eign exchange losses 0.1 — 0.3 0.2 211 Experian plc Annual Report 2021 Financial statements J. T ax on pr oﬁt (a) Analysis of tax charge in the pr oﬁt and loss account 2021 US$m 2020 US$m Current tax: Irish corporation tax char ge on proﬁt for the ﬁnancial y ear — — Deferred tax: Origination and reversal of timing dier ences 20.7 16.5 Adjustment in respect of prior year s 0.1 — T otal deferred tax char ge for the ﬁnancial year 20.8 16.5 T ax charge for the year 20.8 16.5 (b) F actors aecting the tax charge for the ﬁnancial year The tax charge for the year is at a r ate lower than the main rate of Irish corpor ation tax of 25% (2020: 25%) with the dierences explained below . 2021 US$m 2020 US$m Proﬁt befor e tax 182.1 263.7 Proﬁt befor e tax multiplied by the applicable r ate of tax 45.5 65.9 Eects of: Income not taxable (25.8) (50.2) Expenses not deductible 1.0 0.8 Adjustment in respect of prior year s 0.1 — T ax charge for the year 20.8 16.5 The Company’s tax charge will continue to be inﬂuenced by the natur e of its income and expenditure and prevailing Irish and Jer sey tax laws. (c) Deferred tax asset The deferred tax asset is in r espect of tax losses and the movements ther eon are as follow s: 2021 US$m 2020 US$m At 1 April 36.4 52.9 T ax charge in the pr oﬁt and loss account (20.8) (16.5) At 31 March 15.6 36.4 The Company has no unrecognised deferr ed tax (2020: US$nil). K. Dividends T otal gross dividends of US$426.8m (2020: US$424.2m) wer e paid to Experian shareholders during the y ear . The Compan y paid interim dividends of US$21.7m (2020: US$22.0m) to those shareholders who did not elect to r eceive dividends under the Income Access Share arrangements. The balance of US$405.1m (2020: US$402.2m) was paid by a subsidiary undertaking, Experian (UK) Finance Limited (EUKFL), under the Income Access Share arrangements. The Company’s proﬁt and loss account reserv e is available for distribution by way of dividend. At 31 March 2021, the distributable reserves of EUKFL as determined under UK company la w were US$11,972.4m (2020: US$13,551.8m). Since the balance sheet date, the dir ectors have announced a second interim dividend of 32.5 US cents per or dinary share f or the year ended 31 March 2021. No part of this dividend is included as a liability in these ﬁnancial statements. Further details of payment arrangements, including the Income Access Share arr angements, are given in the Shar eholder and corporate inf ormation section of the Annual Report. Experian plc Financial statements 212 Notes to the Company ﬁnancial statements contin ued L. Investments – shar es in Group undertakings Cost and net book amount 2021 US$m 2020 US$m At 1 April 17,413.2 5,301.3 Additions – fair value of share incentiv es issued to Group employees 106.3 83.0 Additional investment in direct subsidiary undertakings 400.0 13,299.8 Return of capital fr om direct subsidiary undertakings — (1,270.9) At 31 March 17,919.5 17,413.2 During the year ended 31 March 2021 Experian plc undertook one tr ansaction as a result of group r estructuring which included subscription for an additional US$400.0m of shares in an existing subsidiary undertaking. During the year ended 31 March 2020 Experian plc undertook a number of tr ansactions as a result of group r estructuring, including: subscription for additional shares in existing subsidiary undertakings for US$13,299.8m; and receipt of dividends of US$1,468.0m. US$1,270.9m was recor ded as a return of capital, with the r emaining US$197.1m recor ded as dividend income in the Company’s proﬁt and loss account. A list of the Company’s subsidiary undertakings is given in note S(i). The Company dir ectly holds interests in the whole of the issued shar e capital of the following undertakings: Company Country of incorporation Experian Group Services Limited Ireland Experian Holdings Ireland Limited Ireland Experian Ireland Investments Limited Ireland M. Leases The Company leases its oces. The original lease term is 25 years and includes periodic br eak options throughout the lease ex ercisable only by the Company and not the lessor . (a) Amounts recognised in the Company balance sheet 2021 US$m 2020 US$m Right-of-use asset: At 1 April 3.0 3.2 Depreciation char ge for the year (0.3) (0.2) At 31 March 2.7 3.0 Lease obligation: Current 0.2 0.2 Non-current 2.9 2.9 At 31 March 3.1 3.1 213 Experian plc Annual Report 2021 Financial statements M. Leases c ontinued (b) Maturity of lease obligation – contractual undiscounted c ash ﬂows 2021 US$m 2020 US$m Less than one year 0.4 0.3 One to two years 0.4 0.3 T wo to three years 0.4 0.3 Three to four year s 0.4 0.3 Four to ﬁv e years 0.4 0.3 Over ﬁve years 2.2 2.4 T otal undiscounted lease obligation at 31 March 4.2 3.9 (c) Amounts recognised in the Company pr oﬁt and loss account 2021 US$m 2020 US$m Depreciation char ge for right-of-use asset 0.3 0.2 Interest expense 0.2 0.2 0.5 0.4 (d) Lease cash ﬂow The total lease cash outﬂow in the year ended 31 Mar ch 2021 was US$0.4m (2020: US$0.4m), of which US$0.2m (2020: US$0.2m) related to payments of interest and US$0.2m (2020: US$0.2m) was for r epayments of principal. N. Debtor s – amounts falling due within one year 2021 US$m 2020 US$m Amounts owed by Group undertakings 1,759.5 1,728.0 Other debtors 1.7 0.7 1,761.2 1,728.7 Amounts owed by Group undertakings ar e primarily unsecured, interest bearing and repayable on demand. O. Creditor s Due within one year 2021 US$m Due after more than one year 2021 US$m Due within one year 2020 US$m Due after more than one year 2020 US$m Lease obligation (note M) 0.2 2.9 0.2 2.9 Accruals 0.9 — 1.2 — 1.1 2.9 1.4 2.9 Experian plc Financial statements 214 Notes to the Company ﬁnancial statements contin ued P . Cal led-up share c apital and share pr emium account Allotted and fully paid 2021 US$m 2020 US$m 969,611,616 (2020: 968,719,632) ordinary shar es of 10 US cents 73.0 72.9 20 (2020: 20) deferred shar es of 10 US cents — — 73.0 72.9 At 31 March 2021 and 31 Mar ch 2020, the authorised share capital of the Compan y was US$200m, divided into 1,999,999,980 or dinary shares and 20 deferred shar es, each of 10 US cents. The ordinary shar es carry the rights to (i) dividend, (ii) to attend or vote at gener al meetings and (iii) to participate in the assets of the Company beyond r epayment of the amounts paid up or credited as paid up on them. The deferred shares c arry no such rights. During the year ended 31 March 2021, the Company issued 891,984 (2020: 865,828) ordinary shares for a consider ation of US$19.4m (2020: US$14.6m) in connection with the Group’s shar e incentive arrangements, details of which are given in note 33 to the Group ﬁnancial statements. The dierence between the consideration and the par v alue of the shares issued is r ecorded in the shar e premium account. In addition, a premium of US$162.8m was recor ded on treasury shar es delivered in the y ear as acquisition consideration (2020: US$nil). There wer e no share r epurchases during the y ear following the suspension of the Company’s shar e repur chase progr amme. In the year ended 31 March 2020, 3,623,753 or dinary shares wer e cancelled after being purchased by the Company . Q. Proﬁt and loss ac c ount reserv e The proﬁt and loss account r eserve is stated after deducting the balance on the own shares r eserve from that on the proﬁt and loss account. The balance on the proﬁt and loss account comprises net pr oﬁts retained in the Company , after the payment of equity dividends. The balance on the own shares r eserve is the cost of ordinary shar es in the Company and further details ar e given below . Number of shares held Cost of shares held T reasury million T rusts million T otal million T reasury US$m T rusts US$m T otal US$m At 1 April 2020 60.4 7.4 67.8 971.3 180.3 1,151.6 Shares deliver ed as consideration f or acquisition (7.2) — (7.2) (90.0) — (90.0) Other vesting of awards and exer cises of shareoptions (0.9) (3.7) (4.6) (12.2) (75.1) (87.3) At 31 March 2021 52.3 3.7 56.0 869.1 105.2 974.3 Number of shares held Cost of shares held T reasury million T rusts million T otal million T reasury US$m T rusts US$m T otal US$m At 1 April 2019 61.5 8.6 70.1 984.6 151.9 1,136.5 Purchase of shar es by employee trusts — 3.0 3.0 — 91.5 91.5 Other vesting of awards and exer cises of shareoptions (1.1) (4.2) (5.3) (13.3) (63.1) (76.4) At 31 March 2020 60.4 7.4 67.8 971.3 180.3 1,151.6 R. Contingencies The Company has guar anteed: borrowings of Gr oup undertakings of US$4,123m (2020: US$4,208m); the liabilities of The Experian plc Employee Shar e T rust and the Experian UK Approved All-Employ ee Share Plan; and the retir ement beneﬁt obligations of Group undertakings that participate in the Experian Pension Scheme and of a Gr oup undertaking that participates in a small UK deﬁned beneﬁt pension plan. An indic ation of the Company’s contingent liability for the year ended 31 Mar ch 2021, in the event that the Group undertakings fail to pay their contributions, is given in note 35(e) to the Group ﬁnancial statements. The Company has also issued a small number of other guar antees in connection with the performance of business contracts by Gr oup undertakings. 215 Experian plc Annual Report 2021 Financial statements S. R elated undertakings at 31 March 2021 (i) Subsidiary undertakings Company Country of incorporation Experian Strategic Solutions SA Argentina Compuscan Austr alia (Pty) Ltd Australia Experian Asia Paciﬁc Pty Ltd Australia Experian Australia Cr edit Services Pty Ltd Austr alia Experian Australia F raud Services Pty Ltd Australia Experian Australia Holdings Pty Ltd Austr alia Experian Australia Pty Ltd Austr alia Look Who’s Char ging Pty Ltd Austr alia Riverleen Finance Pty Ltd Australia T allyman Austr alia Pty Limited Australia Credify Informationsdienstleistungen GmbH Austria 1 Experian Austria GmbH Austria 1 Experian Österreich Verwaltungsgesellschaft mbH Austria 2 Experian Botswana (Pty) Ltd Botswana Brain Soluções de T ecnologia Digital Ltda Brazil 3 BrScan Processamento de Dados e T ecnologia Ltda Brazil 4 Experian T ecnologia Brasil Ltda Brazil 5 Serasa S.A. Brazil 6 Experian Bulgaria EAD Bulgaria Experian Canada Inc. Canada Experian Holdings Chile SpA Chile 7 Experian Services Chile S.A. Chile 8 Beijing Yiboruizhi T echnology Co., Ltd China 9 Experian Credit Service (Beijing) Company Limited China 10 Experian Hong Kong Holdings Limited China 11 Experian Hong Kong Limited China 11 Experian Information T echnology (Beijing) CompanyLimited China 12 Byington Colombia S.A.S. Colombia Experian Colombia S.A. Colombia Experian Services Costa Rica, S.A. Costa Rica Experian A/S Denmark Accolade Unlimited England and W ales Castlight Limited England and W ales CCN UK 2005 Limited England and Wales CCN UK Unlimited England and Wales Chatsworth Investments Limited England and Wales CSID International Limited * England and Wales EHI 2005 Limited England and W ales EHI UK Unlimited England and Wales EIS 2005 Limited England and Wales EIS UK Unlimited England and W ales Experian (UK) Finance Limited England and W ales Experian (UK) Holdings 2006 Limited England and W ales Experian 2001 Unlimited England and W ales Experian 2006 Unlimited England and W ales Experian CIS Limited England and Wales Experian Colombia Investments Limited England and Wales Experian Europe Unlimited England and W ales Experian Finance 2012 Limited England and W ales Experian Finance plc England and W ales Experian Group Limited England and W ales Experian Holdings (UK) Unlimited England and Wales Experian Holdings Limited England and Wales Experian International Unlimited England and W ales Experian Investment Holdings Limited England and Wales Company Country of incorporation Experian Latam Holdings Unlimited England and Wales Experian Limited England and Wales Experian NA Holdings Unlimited England and W ales Experian NA Unlimited England and Wales Experian Nominees Limited England and W ales Experian SURBS Investments Limited England and W ales Experian T echnology Limited England and Wales Experian US Holdings Unlimited England and Wales Experian US Unlimited England and Wales G.U .S. Pr operty Management Limited England and W ales GUS 1998 Unlimited England and W ales GUS 2000 Finance Unlimited England and Wales GUS 2000 UK Unlimited England and Wales GUS 2000 Unlimited England and W ales GUS 2002 Unlimited England and W ales GUS 2004 Limited England and Wales GUS 2005 Finance Unlimited England and Wales GUS Catalogues Unlimited England and Wales GUS Finance (2004) Limited England and W ales GUS Finance 2006 Unlimited England and Wales GUS Finance Holdings Unlimited England and Wales GUS Financial Services Unlimited England and Wales GUS Holdings (2004) Limited England and Wales GUS Holdings Unlimited England and Wales GUS International England and Wales GUS International Holdings UK Societas England and Wales GUS Ireland Holdings UK Societas England and Wales GUS NA Unlimited England and Wales GUS Netherlands Unlimited England and W ales GUS Overseas Holdings UK Societas England and W ales GUS Overseas Investments UK Societas England and Wales GUS Overseas Retailing Unlimited England and W ales GUS Overseas Unlimited England and Wales GUS Property Investments Limited England and W ales GUS Unlimited England and Wales GUS US Holdings UK Societas England and W ales GUS US Holdings Unlimited England and Wales GUS US Unlimited England and W ales GUS V entures Unlimited England and W ales Hugh Wyllie, Limited England and Wales International Communication & Data Limited England and Wales Motorﬁle Limited England and W ales QAS Limited * England and W ales Riverleen Finance Unlimited * England and W ales Runpath Group Limited England and Wales Runpath Pilot Limited England and W ales Runpath Regulated Services Limited England and Wales Serasa Finance Limited England and W ales T allyman Limited England and Wales T apad UK Limited England and W ales T echlightenment Ltd * England and Wales The Royal Exchange Company (Leeds) Unlimited England and W ales The Witney Mattr ess, Div an & Quilt Co. Unlimited England and W ales Compuscan (Pty) Ltd eSwatini/Swaziland Experian Fr ance S.A .S. France Experian Holding EURL F rance Experian plc Financial statements 216 Notes to the Company ﬁnancial statements contin ued Company Country of incorporation Experian Holding Fr ance SAS Fr ance Experian PH Sarl France 3 C Deutschland GmbH Germany 13 CONET Corpor ate Communication Network GmbH Germany 14 Experian GmbH Germany 15 Informa HIS GmbH Germany 16 Informa Solutions GmbH Germany 14 Infoscore Consumer Data GmbH Germany 14 T apad Germany GmbH Germany 17 Experian Credit Information Company of India PrivateLimited India 18 Experian Services India (Private Limited) India 18 W2 Software (India) Private Limited * India 19 PT . Experian Decision Analytics Indonesia Indonesia Experian Group Services Limited Ireland Experian Holdings Ireland Limited Ireland Experian Ireland Investments Limited Ireland Experian Ireland Limited Ireland GUS Finance Ireland Unlimited Company Ireland GUS Investments 2003 Unlimited Company Ireland Experian Holding Italia S.r .l. Italy Experian Italia S.p.A. Italy Experian Japan Co., Ltd Japan MCI-Experian Co., Ltd Republic of Korea Experian Lesotho (Pty) Ltd Lesotho Experian Information Services (Malaysia) Sdn. Bhd. Malaysia 20 Experian (Malaysia) Sdn. Bhd. Malaysia 21 Experian Marketing Services (Malaysia) Sdn Bhd Malaysia 21 Ringgit Arajay a Sdn. Bhd. Malaysia 22 ESI Servicios S. de R.L. de C.V . Mexico Experian de Mexico S. de R.L. de C.V . Mexico Experian Soluciones de Informacion, S.A. de C.V . Mexico Experian Micro Analytics SAM Monaco Scorex SAM Monaco Sistema de informacao de cr edito S.A Mozambique Compuscan Credit R eference Bur eau (Pty) Ltd Namibia Experian New Zealand Limited New Zealand Experian AS Norway Experian Gjeldsregister AS Norway T apAd Norway AS Norway Sentinel Peru S.A Peru Compuscan Philippines, Inc The Philippines Experian Polska spółka z ogr aniczoną odpowiedzialnością Poland DP Management Pte Ltd Singapor e ENROC Pte. Ltd. Singapore Experian Credit Bur eau Singapore Pte. Ltd. Singapore Experian Credit Services Singapor e Pte. Ltd. Singapore Experian Asia-Paciﬁc Holdings Pte. Ltd. Singapore Experian Singapore Pte. Ltd Singapore Compuscan Academ y (Pty) Ltd South Africa 23 Compuscan Holdings International (Pty) Ltd South Africa 23 Compuscan Holdings South Africa (Pty) Ltd * South Africa 23 Compuscan Information T echnologies (Pty) Ltd * South Africa 23 Company Country of incorporation CSH Group (Pty) Ltd South Africa 23 Encentivize (Pty) Ltd * South Afric a 24 Encentivize Rewards (Pty) Ltd * South Africa 24 Experian South Africa (Pty) Limited South Africa 24 Great Universal Stor es (South Africa) (Pty) Ltd South Africa 24 PCubed Analytical Intelligence (Pty) Ltd * South Africa 24 Prolinx (Pty) Ltd * South Africa 23 Scoresharp (Pty) Ltd * South Africa 24 T echtonic Information T echnologies (Pty) Ltd * South Africa 23 Axesor Business Process Outsour cing S.L.U. Spain 25 Axesor Conocer Par a Decidir , S.A. Spain 25 Experian Bureau de Cr édito, S.A. Spain 26 Experian Colombian Investments, S.L.U. Spain 26 Experian España, S.L.U . Spain 26 Experian Holdings Espana, S.L. Spain 26 Experian Latam España Inversiones, S.L. Spain 27 Rexburg Spain, S.L .U . Spain 26 Experian Switzerland AG Switzerland Experian (Thailand) Co., Ltd Thailand Experian Micro Analytics B.V . The Netherlands Experian Nederland BV The Netherlands Experian Scorex Russia B.V . The Netherlands GUS Europe Holdings BV The Netherlands GUS Holdings BV The Netherlands GUS T reasury Services BV The Netherlands Experian Bilgi Hizmetleri Limited Şirketi T urkey Experian Uganda CRB Limited Uganda Ground Up Limited Uganda Auto I.D., Inc. USA 28 ClarityBlue Inc U SA 29 Clarity Services, Inc. USA 28 ConsumerInfo.com Inc USA 30 CSIdentity Corporation USA 28 CSIdentity Insurance Services, Inc. USA 28 Experian Background Data, Inc. USA 28 Experian Credit Advisors, Inc. USA 28 Experian Data Corp USA 28 Experian Fr aud Prevention Solutions, Inc. USA 28 Experian Health, Inc. USA 28 Experian Holdings, Inc. USA 28 Experian Information Solutions Inc U SA 30 Experian Marketing Solutions, LL C USA 28 Experian Reserved Response, Inc. USA 28 Experian Services Corp. USA 28 MyExperian, Inc. USA 28 MyHealthDirect, Inc. USA 29 RewardStock, Inc. USA 28 Riverleen Finance, LL C USA 28 StatSchedules India, LL C USA 28 Strategic Cost Contr ol, Inc. USA 31 String Automotive Solutions, Inc. USA 28 String Enterprises, Inc. USA 28 T apad, Inc. USA 28 The 41st Par ameter , Inc. USA 28 S. R elated undertakings at 31 March 2021 c ontinued (i) Subsidiary undertakings continued Numeric superscripts refer to r egistered oce addresses given innoteS(ii) * In voluntary liquidation 217 Experian plc Annual Report 2021 Financial statements S. R elated undertakings at 31 March 2021 c ontinued (ii) Addresses of r egistered oces of subsidiary undertakings Country of incorporation Address of registered oce Argentina Carlos Pelligrini 887, 4th Floor , Ciudad Autonoma de Buenos Aires, Buenos Aires Australia Level 6, 549 St Kilda Road, Melbourne, VIC 3004 Austria 1 Gumpendorfer Straße 19-21/5. OG, 1060, Wien Austria 2 Strozzigasse 10/14, 1080 Vienna Botswana Plot 64518 Deloitte House, F airgrounds, Gaborone Brazil 3 Avenida Pr esidente V argas, 2921 – 6º Andar – sala 611, Vila Homero, Indaiatuba/SP , 13338-705 Brazil 4 St SCS Quadra 02 Bloco c, 109 - Sala 301 401 501 e 601 Edif , Br asília, Distrito Feder al, 70.302-911 Brazil 5 Al. Vicente Pinzon, 51, cj. 1301, R eserva Vila Olímpia, São Paulo/SP , 04547-130 Brazil 6 Avenida das Nações Unidas, 14401 – T orre C-1 do Complexo Par que da Cidade – conjuntos 191, 192, 201, 202, 211, 212, 221, 222, 231, 232, 241 e 242, Chácar a Santo Antônio, São P aulo/SP , CEP 04794-000 Bulgaria Soﬁa 1784, “Mladost” district, 115G “T sarigr adsko Shosse” 115G, Business center MEGAP ARK, FL. 10-11 Canada 199 Ba y Street, Suite 4000, T oronto, Ontario M5L 1A9 Chile 7 Av el Golf 40 piso, 20 Santiago Chile 8 Av . del V alle 515, Huechur aba, Santiago China 9 Room 604 6F , One Indigo, 20 Jiuxianqiao Road, Chaoyang District, Beijing, 100015 China 10 Room 601-602 6F , One Indigo, 20 Jiuxianqiao Road, Chaoyang District, Beijing, 100015 China 11 Room 2604, 26th Floor , The World T rade Center , 280 Gloucester Road, Causew ay Bay , Hong Kong China 12 Room 607, One Indigo, 20 Jiuxianqiao Road, Chaoyang District, Beijing, 100015 Colombia Carrer a 7, No. 76 -35 Floor 10, Bogota Costa Rica Ediﬁcio Oller Abogados, Pr ovincia de 5551007, A v . 18, San José Province, San José Denmark Lyngbyvej 2, DK -2100, Copenhagen England and Wales The Sir John Peace Building, Experian Way , NG2 Business Park, Nottingham, NG80 1ZZ eSwatini/Swaziland c/o PricewaterhouseCoopers, Rhus Oce P ark, Kal Grant Str eet, Mbabane Fr ance 1 A venue du Génér al de Gaulle, 92800 PUTEAUX, Immeuble PB5 Germany 13 Edisonstraße 19, 74076, Heilbronn Germany 14 Rheinstraße 99, 76532, Baden-Baden Germany 15 Speditionstraße 21, 40221, Düsseldorf Germany 16 Kreuzber ger Ring 68, 65205, Wiesbaden Germany 17 Walther -von-Cronberg-Platz 13, 60594 Frankfurt a. Main India 18 5th Floor , East Wing, T ower 3, Equinox Business P ark, LBS Marg, Kurla (W est), Mumbai, 400070 India 19 1st Floor , Plot No. 6, Janakpuri Colon y , Gunrock, Hyderabad, T elangana 500009 Indonesia W orld T rade Centre 3 Lantai 27, Jl. Jendral Sudirman Kav . 29-31, Kelur ahan Karet, Kecamatan Setiabudi, Kota Adm. Jak arta Selatan, DKI Jakarta Country of incorporation Address of registered oce Ireland Newenham House, Northern Cross, Malahide Road, Dublin 17, D17 A Y61 Italy Piazza dell’Indipendenza No 11/B, 00185, Rome Japan 1-1 Otemachi 1-chome, Chioyda-k u T oky o Republic of Korea 10F Shinhan L T ower , 358 Samil-daer o, Jung-gu, Seoul Lesotho Plot No. 582, Ha Hoohlo Extension, Maseru Malaysia 20 17-9 & 79-9, 9th Floor , The Boulevar d Mid V alley City , Lingkaran S yed Putr a, 59200 Kuala Lumpur Malaysia 21 10th Floor Menara Hap Seng, No. 1 & 3 Jalan P . Ramlee, 50250 Kuala Lumpur , Wilayah P ersekutuan Malaysia 22 Ground, 1st, 2nd & 3r d Floors, Block B, Quill 18, Lingkaran T eknokrat, 3 Barat, Cyber 4, 63000 Sepang, Cyberjaya, Selangor Mexico Paseo de la Reforma No. 115, Desp. 1503, Col. Lomas de Chapultepec, D .F ., C.P . 11000 Monaco Athos Palace 2, Rue de la Lujerneta, MC 98000 Mozambique Edifício Millennium Park, A venida Vladimir Lenine, 174, 13°, Maputo Namibia C/O Aus Secretarial Services, Bougain Villas, 8 Sam Nujoma Drive, Windhoek The Netherlands Grote Marktstr aat 49, 2511BH’s-Gr avenhage New Zealand Level 8, DLA Piper T ower , 205 Queen Str eet, Auckland, 1010 Norway Karenslyst Allé 6, 0278 Oslo Peru A v . Canaval y Moreyr a Nº 480, Piso 19, San Isidr o, Lima The Philippines 24th Floor Philam Life T ower , 8767 P aseo de Roxas, Makati City Poland Plac Marsz. Józefa Piłsudskiego 3, 00-078 Warsa w Singapore 10 Kallang Avenue, #14-18 Aperia T ower 2, Singapore, 339510 South Africa 23 Compuscan House, 3 Neutron A venue, T echno Park, Stellenbosch, 7600 South Africa 24 Experian House, Bally oaks Oce Park, 35 Ballyclare Drive, Bryanston Ext 7, 2191 Spain 25 Calle Graham Bell, s/n, Ediﬁcio Axesor , Par que Empresarial San Isidr o, C.P . 18100, Armilla Spain 26 C/Principe de V ergar a 132, 1a Planta, 28002, Madrid Spain 27 Principe de V ergar a 131 1°, Madrid Switzerland Thurgauerstrasse 101a, CH-8152, Opﬁk on Thailand No. 1788 Singha Complex Building, Room No. 1905, 19th Floor , New Petchburi Road, Bangkapi, Huai Kwang, Bangkok T urkey River Plaza Büyükder e Cad.Bahar Sok.No:13 K:8 Levent 34394 İstanbul Uganda Plot 23, 3rd Floor , North Wing, Soliz House, Lumumba Avenue, Nakasero, Kampala USA 28 The Corporation T rust Company , 1209 Or ange Street, Wilmington DE 19801 USA 29 475 Anton Boulevard, Costa Mesa, CA 92626 USA 30 CT Corpor ation System, 818 West 7th Str eet, Los Angeles, CA 90017 USA 31 CSC, 975 Brush Hill Rd, Milton MA 02186 Numeric superscripts refer to subsidiary undertakings giv en in note S(i) Experian plc Financial statements 218 Notes to the Company ﬁnancial statements contin ued S. R elated undertakings at 31 March 2021 c ontinued (iii) Additional information on subsidiary undertakings Summary The results of the undertakings listed at note S(i) ar e included in the Group ﬁnancial statements. Except as indicated below , the Company has direct or indirect inter ests in the whole of the issued equity shares of these undertakings. Undertakings which are direct subsidiaries of the Company ar e detailed in note L to these ﬁnancial statements. Since demerger fr om GUS plc in 2006, the Compan y has eliminated dormant and inactive companies through an ongoing internal pr ogr amme. Holdings comprising less than 100% Interests of less than 100% of the issued equity of subsidiary undertakings ar e: Brain Soluções de T ecnologia Digital Ltda – 55.0% Credify Informationsdienstleistungen GmbH – 60.0% DP Management Pte Ltd – 51.0% Experian Australia Cr edit Services Pty Ltd – 84.7% Experian Bureau de Cr édito, S.A. – 75.0% Experian Colombia S.A. – 99.9% Experian Credit Information Company of India Priv ate Limited – 66.7% Experian Italia S.p.A. – 95.0% Experian Information Services (Malaysia) Sdn. Bhd. – 74.0% Experian South Africa (Pty) Limited – 87.5% Informa Solutions GmbH – 60.0% MCI-Experian Co., Ltd – 51.0% Serasa S.A. – 99.7% Holdings comprising other than ordinary shares, common stock or common shares The Company’s equity interests comprise dir ect or indirect holdings of ordinary shares, common stock or common shares only , except as listed below: GUS 2004 Limited, Motorﬁle Limited and Experian Soluciones de Informacion, S.A . de C.V . – A ordinary and B ordinary shares GUS International and GUS Investments 2003 Unlimited Company – B or dinary shares GUS 2000 Unlimited – X ordinary and Y or dinary shares Experian Holdings, Inc. – class A and B common stock Experian Information Solutions Inc – common no par value shar es Experian Services Corp. – common no par v alue shares Opt-Out Services, LL C – membership inter ests shares Riverleen Finance, LL C – common stock shares 219 Experian plc Annual Report 2021 Financial statements S. R elated undertakings at 31 March 2021 c ontinued (iv) Associate undertakings Company Holding Country of incorporation V ector CM Holdings (Cayman), L.P . 23.1% Cayman Islands London & Country Mortgages Limited 25.0% England and Wales United Credit Bur eau 25.0% Russia Who Owns Whom (Pty) Limited 32.9% South Africa Online Data Exchange LL C 25.0% USA Opt-Out Services, LL C 25.0% USA Central Sour ce LL C 33.3% USA New Management Services, LL C 33.3% USA V antageScore Solutions, LLC 33.3% USA (v) Other undertakings Undertaking Country of incorporation oroperation Serasa Experian Pension Plan Brazil Brigstock Finance Limited England and Wales Experian Medical Plan Limited England and W ales Experian Pension Scheme England and Wales Experian Retirement Sa vings Plan England and Wales Experian Retirement Sa vings T rustees Limited England and W ales Experian T rustees Limited England and W ales Experian UK Approved All -Employee Share Plan England and Wales The Pension and Life Assur ance Plan of Sanderson Systems Limited England and Wales V ersorgungsordnung der Barcla ys Industrie Bank GmbH vom April 1988 (incl. amendments) Germany The Experian Ireland Pension Plan Ireland The Experian plc Employee Share T rust Jersey Compuscan T eam Investment T rust South Africa CSH Education & W elfare T rust South Africa Experian Personal Investment Plan U SA These undertakings are not subsidiaries or associates. Brigstock Finance Limited is a ﬁnance company . The other undertakings operate in connection with the Group’s shar e incentive plans, pension arr angements in the UK, the USA, Br azil, South Africa and Germany , and the provision of medic al cover in the UK. Experian plc Shareholder and corpor ate information 220 Shareholder and corpor ate information Analysis of shar e register at 31 March 2021 By size of shareholding Number of shareholders % Number of shares % Over 1,000,000 144 0.7 802,461,521 82.8 100,001 to 1,000,000 366 1.7 120,910,798 12.5 10,001 to 100,000 753 3.5 25,666,597 2.6 5,001 to 10,000 581 2.7 3,962,292 0.4 2,001 to 5,000 2,039 9.4 6,173,291 0.6 1 to 2,000 17,839 82.0 10,437,117 1.1 T otal 21,722 100.0 969,611,616 100.0 By nature of shareholding Number of shareholders % Number of shares % Corporates 3,663 16.9 897,137,030 92.5 Individuals 18,058 83.1 20,196,573 2.1 T reasury shares 1 — 52,278,013 5.4 T otal 21,722 100.0 969,611,616 100.0 Company website A full range of in vestor information is available at www .experianplc.com. Details of the 2021 AGM, to be held in Dublin, Ir eland on Wednesday , 21July 2021, ar e given on the website and in the notice of meeting. Information on the Company’s share price is a vailable on the website. Electronic shareholder communic ation Shareholders may r egister for Share Portal, an electr onic communication service provided by Link Mark et Services (Jersey) Limited, via the Company website at www .experianplc.com/shares. The service is free and it facilitates the use of a comprehensive r ange of shareholder services online. When registering for Shar e Portal, shareholders c an select their preferr ed communication method – email or post. Shareholders will r eceive a written notiﬁcation of the availability on the Compan y’s website of shareholder documents, such as the Annual Report, unless they have elected to either (i) receive such notiﬁc ation by email or (ii) receive paper copies of shareholder documents, where such documents ar e available in that format. Dividend information Dividends for the year ended 31 March 2021 A second interim dividend in respect of the year ended 31 Mar ch 2021 of 32.5 US cents per ordinary shar e will be paid on 23 July 2021, to shareholders on the r egister of members at the close of business on 25 June 2021. Unless shar eholders elect by 25 June 2021 to r eceive US dollars, their dividends will be paid in pounds sterling at a rate per shar e calculated on the basis of the exchange r ate from US dollar s to pounds sterling on 2 July 2021. A ﬁr st interim dividend of 14.5 US cents per ordinary shar e was paid on 5 F ebruary 2021. Income Access Share arr angements As its ordinary shar es are listed on the London Stock Exchange, the Company has a large number of UK r esident shareholders. In or der that shareholders may r eceive Experian dividends from a UK source, should they wish, the Income Access Shar e (IAS) arrangements have been put in place. The purpose of the IAS arrangements is to pr eserve the tax treatment of dividends paid to Experian shar eholders in the UK, in respect of dividends paid by the Company . Shar eholders who elect, or are deemed to elect, to r eceive their dividends via the IAS arr angements will receive their dividends from a UK sour ce (rather than dir ectly from the Company) for UK tax purposes. Shareholders who hold 50,000 or fewer Experian plc shar es on the ﬁrst dividend recor d date after they become shareholder s, unless they elect otherwise, will be deemed to ha ve elected to receive their dividends under the IAS arrangements. Shareholders who hold mor e than 50,000 shares and who wish to receive their dividends from a UK sour ce must make an election to r eceive dividends via the IAS arrangements. All elections remain in force indeﬁnitely unless revok ed. Unless shareholders ha ve made an election to receive dividends via the IAS arrangements, or are deemed to have made such an election, dividends will be received fr om an Irish source and will be taxed accordingly . The ﬁnal date for submission of elections to r eceive UK sourced dividends via the IAS arr angements is 25 June 2021. Dividend Reinv estment Plan (DRIP) The DRIP enables those shareholders who r eceive their dividends under the Income Access Share arr angements to use their cash dividends to buy more shar es in the Company . Eligible shar eholders, who wish to participate in the DRIP in respect of the second interim dividend for the year ended 31 March 2021, to be paid on 23 July 2021, should return a completed and signed DRIP application form, to be received by the registr ars no later than 25 June 2021. Shareholders should contact the registr ars for further details. 221 Experian plc Annual Report 2021 Shareholder and corporate information Capital Gains T ax (CG T) base cost for UK shareholder s On 10 October 2006, GUS plc separ ated its Experian business from its Home Retail Group business by w ay of demerger . GUS plc shareholders were entitled to r eceive one share in Experian plc and one shar e in Home Retail Group plc f or every share they held in GUS plc. The base cost of any GUS plc shares held at demer ger is apportioned for UK CGT purposes in the ratio 58.235% to Experian plc shar es and 41.765% to Home Retail Group plc shar es. This is based on the closing prices of the respective shar es on their ﬁrst day of tr ading after their admission to the Ocial List of the London Stock Exchange on 11 October 2006. F or GUS plc shares acquir ed prior to the demerger of Burberry on 13 December 2005, which ar e aected by both the Burberry demerger and the subsequent separation of Experian and Home R etail Group, the original CGT base cost is apportioned 50.604% to Experian plc shares, 36.293% to Home Retail Group plc shar es and 13.103% to Burberry Group plc shares. Shareholder security Shareholders ar e advised to be wary of any unsolicited advice, oers to buy shares at a discount or oers of fr ee reports about the Company . More detailed information on such matters c an be found at www .moneyadviceservice.org.uk. Details of any share dealing facilities that the Company endorses will be included on the Company’s website or in Company mailings. The Unclaimed Assets Register Experian owns and participates in The Unclaimed Assets Register , which provides a sear ch facility for shareholdings and other ﬁnancial assets that may have been for gotten. F or further information, please contact The Unclaimed Assets Register , The Sir John Peace Building, Experian W ay , NG2 Business Park, Nottingham, NG80 1ZZ, United Kingdom (T +44 (0) 333 000 0182, E [email protected]) or visit www .uar .co.uk. American Depositary R eceipts (ADR) Experian has a sponsored Level 1 ADR pr ogramme, for which Bank of New Y ork Mellon acts as Depositary . This pr ogramme trades on the highest tier of the US over-the-counter mark et, O TCQX, under the symbol EXPGY . Each ADR repr esents one Experian plc ordinary shar e. Further information can be obtained by contacting: Shareholder Corr espondence BNY Mellon Depositary Receipts PO Box 505000 Louisville, KY 40233-5000 USA T +1 201 680 6825 (from the US A 1-888-BNY - ADRS) E shrrelations@cpushar eownerservices.com W www .mybnymdr .com Financial calendar Second interim dividend recor d date 25 June 2021 T rading update, ﬁrst quarter 15 July 2021 AGM 21 July 2021 Second interim dividend payment date 23 July 2021 Half-yearly ﬁnancial r eport 17 November 2021 T rading update, thir d quarter 14 January 2022 Preliminary announcement of full- year r esults May 2022 Contact information Corporate headquarter s Experian plc Newenham House Northern Cross Malahide Road Dublin 17 D17 A Y61 Ireland T +353 (0) 1 846 9100 F +353 (0) 1 846 9150 Investor relations E [email protected] Registered oce Experian plc 22 Grenville Str eet St Helier Jersey JE4 8PX Channel Islands Registered number – 93905 Registr ars Experian Shareholder Services Link Market Services (Jersey) Limited PO Box 532 St Helier Jersey JE4 5UW Channel Islands T 0371 664 9245 T (for calls fr om outside the UK) +44 800 141 2952 E experian@linkregistr ars.com Calls are char ged at the standard geogr aphic rate and will vary by provider . Calls from outside the United Kingdom will be char ged at the applicable international r ate. Lines ar e open from 8.30am to 5.30pm (UK time) Monday to Friday e xcluding public holidays in England and W ales. Stock ex change listing information Exchange: London Stock Exchange, Pr emium Main Market Index: FTSE 100 Symbol: EXPN Experian plc Shareholder and corpor ate information 222 Glossary The following abbreviations ar e used in this Annual Report, and are taken to ha ve the following meanings: Abbreviation Meaning AGM Annual General Meeting AI Artiﬁcial intelligence API Applic ation Progr amming Interface B2B Business-to-Business B2B2C Business-to-Business-to-Consumer B2C Business-to-Consumer Benchmark EBIT Benchmark earnings before inter est and tax. See note 6 to the Group ﬁnancial statements Benchmark EBITDA Benchmark earnings before interest, tax, depreciation and amortisation. See note 6 to the Group ﬁnancial statements Benchmark EPS Benchmark earnings per shar e. See note 6 to the Gr oup ﬁnancial statements Benchmark operating c ash ﬂow See note 6 to the Group ﬁnancial statements Benchmark PBT Benchmark pr oﬁt before tax. See note 6 to the Group ﬁnancial statements CCM Experian’s email/cross-channel mark eting business (a discontinued operation) CCP A California Consumer Privacy Act CDP CDP , formerly known as the Carbon Disclosure Pr oject CEO Chief Executive Ocer CFO Chief Financial Ocer CGU Cash-generating unit CIP Co-investment Plans Code The UK Corporate Go vernance Code Company Experian plc COO Chief Operating Ocer CPIH The Consumer Price Index including owner occupiers’ housing costs CSID The CSID group of companies comprising CSIdentity Corporation and CSID International Limited DEFRA The UK Government’s Department for Environment, Food and Rur al Aairs DEI Diversity , equity and inclusion EITS Experian Information T echnology Services EMEA Europe, Middle East and Afric a EPS Earnings per share ERG Employee Resour ce Group ERMC Executive Risk Management Committee ESG Environmental, social and go vernance FBU F air , balanced and understandable FCA The UK Financial Conduct Authority FRS Financial Reporting Standard FTE Full-time equivalent FVOCI F air value through Other comprehensive income FVPL Fair v alue through pr oﬁt or loss FX For eign exchange rate(s) FY19 Y ear ended 31 March 2019 FY20 Y ear ended 31 March 2020 FY21 Y ear ended 31 March 2021 FY22 Y ear ending 31 March 2022 FY23 Y ear ending 31 March 2023 GAAP Generally Accepted A ccounting Practice GDP Gross Domestic Pr oduct GDPR Gener al Data Protection Regulation GIA Global Internal Audit GSO Global Security Oce H1 The ﬁrst half of Experian’s ﬁnancial year , being the 6 months ending 30 September H2 The second half of Experian’s ﬁnancial year , being the 6 months ending 31 Mar ch HMRC The UK’s ‘Her Majesty’s Revenue & Customs’ IAS International Accounting Standar d IAS arrangement Income Access Share arr angement for the payment of dividends from a UK source IASB International Accounting Standards Boar d IFRIC International Financial Reporting Standards Interpretations Committee 223 Experian plc Annual Report 2021 Shareholder and corporate information Abbreviation Meaning IFRS or IFRSs International Financial Reporting Standards IRS The US Internal Revenue Service ISO International Or ganization for Standardization KPI Key performance indicator LGPD Brazil General Data Pr otection Law MSCIP Marketing Services Consumer Information Portal NED Non-executive dir ector NGO Non-governmental organisation NPS Net Promoter Scor e OCI Other compr ehensive income OpCo Group Operating Committee Policy Directors’ remuner ation policy PSP Performance Share Plan Q1 The ﬁr st quarter of Experian’s ﬁnancial year , being the 3 months ending 30 June Q2 The second quarter of Experian’s ﬁnancial y ear , being the 3 months ending 30 September Q3 The thir d quarter of Experian’s ﬁnancial year , being the 3 months ending 31 December Q4 The fourth quarter of Experian’s ﬁnancial year , being the 3 months ending 31 March RF Radiative F orcing ROCE Return on capital employed SaaS Software-as-a- Service TCFD T ask Force on Climate-r elated Financial Disclosures TSR T otal shareholder return UK&I United Kingdom and Ireland WAC C The Group’s pre-tax weighted aver age cost of capital Notes De sign ed an d pro duce d by Friend ww w. friendstudio.com Print : Pureprint Group Th is rep or t has b een p rint ed on U PM Fin ess e Sil k which i s FSC ® cer ti ﬁe d and ma de fr om 1 00% E leme ntal C hlor ine Fre e (ECF ) pul p. Th e mil l and th e prin ter ar e both c er tiﬁ ed to I SO 1 4 00 1 environmental ma nagement. The repor t was p rint ed usi ng ve geta ble ba sed i nks b y a CarbonN eutral® printer . Envir onment Committed to becoming carbon neutr al in own oper ations by 2030 Science-based T ar get for 2030 set Ye s Overall CO 2 e in tonnes Reduced by 58% Carbon intensity (CO 2 e per US$1,000 of revenue) Reduced by 60% FY21 carbon emissions oset 20% Electricity from r enewable sources 34% CDP Climate Change score (in the Leadership band) A- Social Improving ﬁnancial health Number of people with proﬁles in Experian’s consumer information bur eaux 1.3bn Number of free consumer memberships 110m Consumers connected to Experian Boost in the USA 6.7m   V alue of debt written o by Limpe Nome in FY21 US$6.7bn T otal people reached by our Social Innovation pr oducts since 2013 61m T arget to r each people through Social Innov ation products by 2025 100m T otal people reached in FY21 through our United f or Financial Health education progr amme 35m T arget to r each people through United for Financial Health by 2024 100m Number of credit oers to people in emer ging markets using our micr o analytics 3.1bn Unbanked people who could beneﬁt through alternative data sour ces and Experian technology platforms 1.7bn Data Data security , accur acy , privacy and tr ansparency ar e a top priority Rigorous security contr ols based on ISO 27001 and we hold Cyber Essentials Certiﬁcation Employees Glassdoor employee r ating 4.1 Gender diversity targets set Ye s Signatory of UN W omen’s Empowerment Principles Ye s Mandatory annual training for all employ ees: Code of Conduct Security and data Anti-corruption Supply Chain A member of the Slave-Fr ee Alliance Suppliers must comply with our Supply Chain Principles, which are aligned with UN Univer sal Declaration of Human Rights Supplier Diversity Progr amme Ye s Governanc e Independent Board members, including independent Chairman 73% Female Boar d members 36% Board meets Hampton-Ale xander Review recommendation on gender diver sity Ye s Ethnically diverse Boar d members 2 Board meets P arker Review Committee r ecommendation on ethnic diversity Ye s Independence of Audit, Remuner ation and Nomination and Corporate Governance committees 100% Independent Chair and clear division of responsibilities between the Chairman and CEO Ye s Independent external evaluation of the Board’s perf ormance, occurs ev ery three years Ye s Executive remuner ation linked to Group performance Ye s V oting rights for ordinary shareholders Ye s Sustainability: at a glance Annua l Repor t 2021 ww w.experianplc.com/ annualrepor t Sustainable Busines s Repor t 202 1 ww w.experianplc.com/ sb report E xper ian plc web site ww w.experianplc.com Corporate headquarters Experian plc Newenham Hous e Nor thern Cross Malahide Road Dublin 1 7 D 17 A Y61 Irelan d T + 353 (0) 1 84 6 91 00 w ww.exper ianplc.com Operational headquarters Experian 4 75 A nton Boulev ard Costa Mesa C A 92626 United State s T + 1 71 4 830 700 0 w ww.experian.com Serasa Experian Av . D outor H eitor Jos é Reali 360 CEP 1 357 1 -3 85 São Carl os Braz il T +55 1 1 3004 7728 ww w .serasaexperia n.com. br Experian Th e Sir John Pea ce Buildin g E xperian Way NG2 Busi ness P ark Not tingham N G 8 0 1Z Z United K ingdom T +4 4 (0) 1 1 5 94 1 088 8 w ww.experian.co.uk Experian Annual Report 2021

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