Climate Change Data

Environmental Metrics

ESG Focus Areas

• Health and safety
• Environmental matters

Environmental Achievements

• No reportable environmental incidents at Coats.
• Reduction in frequency of reportable safety incidents at Capral since 1 January 2005.

Social Achievements

• Coats reduced its global rate of reportable safety incidents in 2008 compared to 2007.
• T&G operates in compliance with best practice in New Zealand in relation to environmental and employee matters.

Governance Achievements

• The Board has put in place corporate governance arrangements.
• The Board has set up an Audit Committee and Remuneration Committee.

Climate Goals & Targets

Environmental Challenges

• Disappointing loss of £4 million at Coats due to economic downturn.
• Poor trading conditions affecting Coats, Capral, and other subsidiaries.
• Significant uncertainties facing Capral.

Mitigation Strategies

• Coats will continue to encounter difficult trading conditions during 2009 but that may provide some relative advantages in terms of the economic cycle.
• Portfolio writedowns have been necessary as a consequence of the global financial crisis.
• Capral's directors concluded that it was appropriate to prepare its financial statements on a going concern basis.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: IFRS

Certifications: ISO14000 (Coats aims for)

Environmental Metrics

Social Achievements

• Charitable donations of £130,976 (2009: £130,574), principally to local charities serving the communities in which the Group operates.

Governance Achievements

• Appointment of four independent non-executive directors to the Board.
• Establishment of an Independent Board Committee, an Audit, Finance and Risk Committee, and a Remuneration and Nominations Committee.

Climate Goals & Targets

Environmental Challenges

• Coats EU Fine: A fine of a110.3 million was imposed on Coats by the European Commission in 2007. This ruling is being vigorously contested.
• Human Resources: Dependency on key staff and individuals.
• Pensions: Significant defined benefit pension schemes in the UK and US.
• Regulatory Compliance: Compliance with regulatory regimes in the UK, Australia, and New Zealand.
• Lower Passaic River Study Area: Coats is a potentially responsible party under the US Superfund for investigation and remediation costs.

Mitigation Strategies

• Coats is vigorously contesting the European Commission fine.
• Regular review of incentivisation/reward arrangements.
• Regular monitoring of pension scheme exposure and contact with trustees.
• Relying on qualified external advisors for regulatory and reporting requirements.
• Coats is joining a cooperating parties group to fund and conduct a remedial investigation and feasibility study of the Lower Passaic River Study Area.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: IFRS

Third-party Assurance: Deloitte LLP

Environmental Metrics

Governance Achievements

• Strengthened Coats Board with three independent non-executive directors
• Changes to the Board of the Company

Climate Goals & Targets

Environmental Challenges

• Coats’ appeal against a fine levied by the European Commission regarding alleged market-sharing
• Significant uncertainty surrounds the ultimate outcome of this matter.
• considerable capital market turmoil

Mitigation Strategies

• The directors remain of the view that any anticipated eventual payment of the fine is adequately covered by existing provisions.
• Intensive management of the working capital and liability position of the Company.
• renewal of banking facilities is being progressed (and a parallel process is being undertaken by Coats).

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: IFRSs

Third-party Assurance: Deloitte LLP