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Risk factors

The views expressed should not be considered as advice or a recommendation to buy, sell or hold a particular investment. They reflect opinion and should not be taken as statements of fact, nor should any reliance be placed on them when making investment decisions.

This report was produced and approved in March 2026 and has not been updated subsequently.

It represents views held at the time of writing and may not reflect current thinking.

Potential for profit and loss

All investment strategies have the potential for profit and loss, your or your clients' capital may be at risk. Past performance is not a guide to future returns.

Stock examples

This report contains information on investments which does not constitute independent research. Accordingly, it is not subject to the protections afforded to independent research but is classified as advertising under Art 68 of the Financial Services Act ('FinSA') and Baillie Gifford and its staff may have dealt in the investments concerned.

All information is sourced from Baillie Gifford & Co and is current unless otherwise stated.

The images used in this report are for illustrative purposes only.

Baillie Gifford™

CS2657469 Stewardship Activities Report 2025_Digital Ref: 188319

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Contents

• Welcome
• About Baillie Gifford
• Introduction
• Our stewardship principles
• Our year in stewardship
• Proxy voting
• Engagement
• Promoting well-functioning markets
• Other developments in 2025
• Appendices

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Welcome

At Baillie Gifford, stewardship means being thoughtful, active and responsible investors on behalf of our clients. As managing partner of Baillie Gifford, I am pleased to present our Investment Stewardship Activities Report for 2025, which is our first opportunity to report under the UK Stewardship Code 2026. Baillie Gifford has been a signatory to the UK Stewardship Code since its inception and has long advocated for good stewardship to be at the heart of the UK asset management industry. Managing our clients' financial assets is a privilege, and we remain focused on our aim of delivering sustainable, long-term investment returns.

As managing partner of Baillie Gifford, I am pleased to present our Investment Stewardship Activities Report for 2025, which is our first opportunity to report under the UK Stewardship Code 2026. Baillie Gifford has been a signatory to the UK Stewardship Code since its inception and has long advocated for good stewardship to be at the heart of the UK asset management industry. Managing our clients' financial assets is a privilege, and we remain focused on our aim of delivering sustainable, long-term investment returns.

• This report sets out our stewardship approach and the pathways we have chosen to achieve effective outcomes for our clients' long-term benefit. Stewardship is an integral and enduring part of how we act on behalf of our clients, and as such, we have invested significant effort in strengthening our capabilities over time. We continue to:
• Take a long-term approach to our engagement and proxy voting activities.
• Work constructively with stakeholders across the industry to support well-functioning markets.
• Refine our stewardship processes to ensure they remain aligned with our investment approach.
• This will help ensure we remain well-positioned to act as effective stewards on behalf of our clients who entrust us with this responsibility.

On behalf of all our partners and colleagues at Baillie Gifford, I welcome this opportunity to present our 2025 report.

Tim Campbell Managing Partner

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About Baillie Gifford

Baillie Gifford is an investment management firm founded in 1908 and headquartered in Edinburgh, Scotland. We employ approximately 1,700 people, with our main base in Scotland and additional offices worldwide. Our purpose has always been to deliver excellent returns for our clients by investing in companies for the long term.

Assets under management

As of 31 December 2025, our assets under management (AUM) and advice totalled £203bn. Most of our assets remain invested in equities, with our largest client base in the UK and North America. A full breakdown of our AUM by asset class, region and client type is detailed in the appendix.

Stewardship resource

Our investors, ESG analysts, central climate, voting and ESG data functions are all responsible for the stewardship of our clients' assets. As of 31 December 2025, Baillie Gifford had 153 investors and 19 environmental, social and governance (ESG) research analysts embedded within some of our investment teams. The analysts and investors are supported by our central climate, voting and ESG data functions, comprising a further 19 people.

The majority of our investment staff are based in Edinburgh, except for a small number based in our global offices. Our investment staff and ESG team remain integral to delivering effective stewardship.

For more information on our resourcing, see Our Stewardship Principles and Guidelines and our People Report on our website.

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Introduction

In line with the Principles of the UK Stewardship Code 2026 (the Code), this report highlights our key stewardship activities and outcomes from 2025. This report should be read alongside Our Stewardship Principles and Guidelines, which outlines our stewardship approach and serves as our Policy and Context disclosure for the purposes of adhering to the Code.

An overview of how and where we evidence our approach to each Code principle we report on can be found in Appendix A. While this report directly links to the UK Stewardship Code 2026, it also evidences our compliance with a number of global stewardship codes. See Appendix D for more details.

For Baillie Gifford, good stewardship means being active and engaged owners of the companies we invest in to support long-term value creation for our clients and beneficiaries. Where possible, we consider all asset classes within the framework of our stewardship activities. However, our stewardship principles are generally more applicable to corporate securities, as these represent the majority of our assets under management. The use of ‘company’ or ‘corporate’ throughout the report refers to listed equities, unless otherwise stated. This report includes examples of our interactions with portfolio companies throughout 2025, primarily related to governance and sustainability issues. These represent only a subset of our total interactions with investee companies and do not capture an exhaustive list of topics discussed with companies through the ordinary course of business. We have focused this report on the issues we believe are of greatest interest to the majority of our clients. We undertake our stewardship responsibilities on behalf of our clients, who select us for our active investment approach. Our long-term, fundamental investment philosophy aligns well with our institutional clients, who also have long time horizons. Our investment processes, from idea generation to stewardship activities, are driven by long-termism. This is evidenced in our average ownership period of more than six years.

We undertake our stewardship responsibilities on behalf of our clients, who select us for our active investment approach. Our long-term, fundamental investment philosophy aligns well with our institutional clients, who also have long time horizons. Our investment processes, from idea generation to stewardship activities, are driven by long-termism. This is evidenced in our average ownership period of more than six years.

Our annual client satisfaction survey, now in its 25th year, continues to provide us with valuable feedback and helps us identify areas where we can improve to meet our clients' expectations. In 2025, we were pleased to see that despite a challenging backdrop, client feedback included positive references to the consistency of our investment process, stability and culture. We understand there is some interest in more detailed, frequent reporting, and we are already taking steps to enhance our data and reporting capabilities.

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Our stewardship principles and approach

Our stewardship principles and approach

As an investment manager, we aim to deliver strong returns for our clients, supporting the firms we back on their behalf to succeed. Our role as an engaged owner is central to our mission to be effective stewards for our clients.

Baillie Gifford's stewardship principles

Our approach favours a few simple principles rather than overly prescriptive policies. This helps shape our interactions with holdings and ensures our investment teams have the freedom and retain the responsibility to act in clients' best interests.

We seek to apply the most appropriate ownership tools to each holding to deliver our objectives.

For more information about Baillie Gifford's purpose, strategy and culture, and how we apply these principles, please see Our Stewardship Principles and Guidelines.

Long-term value creation

We believe that companies that are run for the long term are likely to be better investments over our clients' time horizons. We encourage our holdings to be ambitious, focusing on long-term value creation and capital deployment for growth. We know events will not always run according to plan. In these instances we expect management to act deliberately and provide appropriate transparency. Helping management to resist short-term demands from shareholders often protects returns. We regard it as our responsibility to encourage holdings away from destructive financial engineering towards activities that create genuine value over the long run. Our value may sometimes be in supporting management when others don't.

Governance fit for purpose

Corporate governance is a combination of structures and behaviours; a careful balance between systems, processes and people. Good governance is the essential foundation for long-term company success. We firmly believe that there is no single governance model that delivers the best long-term outcomes. We therefore strive to push back against one-dimensional global governance principles in favour of a deep understanding of each company we invest in. We look for structures, people and processes that we think can maximise the likelihood of long-term success. We expect to trust the boards and management teams of the companies we select, but demand accountability if that trust is broken.

Alignment in vision and practice

Alignment is at the heart of our stewardship approach. We seek the fair treatment of all holders alongside the interests of management. Assessing alignment with management often comes down to intangible factors and an understanding built over time. We look for clear evidence of alignment in everything from capital allocation decisions in moments of stress to the details of executive remuneration plans and committed share ownership. We expect companies to deepen alignment with us, rather than weaken it, where the opportunity presents itself.

Sustainable business practices

A company’s ability to grow and generate value for our clients relies on a network of interdependencies between the company and the economy, society and environment in which it operates. We expect holdings to consider how their actions impact and rely on these relationships. We believe long-term success depends on maintaining a social licence to operate and so we look for holdings to work within the spirit and not just the letter of the laws and regulations that govern them. Material factors should be addressed at the board level as appropriate.

How the integration of stewardship into our investment approach has differed across funds, asset classes and geographies

Our investment strategies operate with a high degree of autonomy and are managed in line with the mandates agreed with clients or the fund offering documents. For our strategies that have made sustainability commitments and/or are not zero aligning, we may place greater weight on environmental and/or social factors when undertaking stewardship activities.

Stewardship is important across the range of asset classes we invest in on behalf of our clients. Our consideration of ESG factors, when these are material to the investment case, remains bottom-up and specific to the entity we are evaluating. Baillie Gifford's stewardship principles provide a guiding framework for considering each asset class in the context of its unique characteristics.

• Our stewardship opportunities depend on the investor rights associated with the asset class under consideration. In each case, we seek to use the ownership tools we believe will best support our clients' long-term interests. • When investing in government debt, we see benefits in collaboratively engaging to reach desired stewardship outcomes. An example of such an engagement is our sovereign engagement with Indonesia, more information on which can be found on page 45.
• Given that our corporate debt holdings do not allow us to vote, our stewardship activities are focused on pre-buy analysis supported by ongoing engagement where required.
• In relation to our Multi Asset products, stewardship is adapted depending on the asset class we hold, with a focus on engagement, voting and pre-buy analysis as appropriate.
• When investing in government debt, we see benefits in collaboratively engaging to reach desired stewardship outcomes. An example of such an engagement is our sovereign engagement with Indonesia, more information on which can be found on page 45.
• In relation to our Multi Asset products, stewardship is adapted depending on the asset class we hold, with a focus on engagement, voting and pre-buy analysis as appropriate.
• Our private company assets are often at an earlier stage of development and, therefore, may require a tailored approach to stewardship. We discuss this further on page 47.
• Our bottom-up fundamental approach to investment research seeks to recognise specific cultural norms and contexts. This extends to our stewardship approach. While our Stewardship Principles and Guidelines provide a baseline for this, the issues we focus on through our stewardship activities seek to recognise geographic variation.

Our year in stewardship

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Our year in stewardship

This section of the report provides insight into the proxy voting and engagement activities we have undertaken during the year on behalf of our clients, guided by our stewardship principles. Examples of our voting and engagement activities are tilted towards companies, as these represent the majority of our assets under management, but we have also included examples from other asset classes.

This section also sets out our work to promote well-functioning markets, which has involved engaging with a wide range of stakeholders and topics throughout 2025. Additionally, updates are provided on other developments during the year, including our review of our conflicts of interest policy and ongoing engagement with third-party providers whose services support our stewardship activities.

Stewardship in action

We use our stewardship principles to frame our engagements. The map below contains examples of how we apply the principles in practice across regions.

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Proxy voting

Voting as a stewardship tool

Voting is a core part of our role as responsible stewards of our clients' capital. Every voting decision is made with the objective of supporting a company's long-term prospects and, in turn, the long-term outcomes we seek for clients.

Our voting analysis is grounded in Baillie Gifford's bottom-up investment philosophy and led by the specific investment case and investment mandate.

• We evaluate every resolution on its merits rather than relying on prescriptive, one-size-fits-all policies.
• –Company circumstances – such as stage of development, geography and industry dynamics – shape what good governance looks like in practice. We believe overly rigid policies can sometimes produce unwarranted and occasionally perverse outcomes that are not in a company’s best interests.
• We prefer to take direct voting responsibility on behalf of clients to strengthen the effectiveness of our stewardship. For segregated mandates, clients may retain voting rights or provide direction on specific issues, as agreed.

The following chart summarises Baillie Gifford's proxy voting activity in 2025. We voted at 1,105 company meetings out of a possible 1,154 – 96 percent of the meetings at which we were eligible to vote.

While we aim to vote all clients' shares, there are instances where we cannot vote due to regulatory requirements or operational constraints. For example, since 2022, we have not voted at shareholder meetings for our remaining Russian holdings to avoid any potential breach of international sanctions related to the conflict between Russia and Ukraine.

Baillie Gifford proxy voting activity 2025

1 For (12,014 resolutions) 94.5

2 Against (526 resolutions) 4.1

3 Abstain (173 resolutions) 1.4

Figures may not sum due to rounding.

How decisions are made – and how we engage around votes

A crucial component of our stock selection process is the assessment of management's ambition and leadership in the context of our long-term investment thesis. We are unlikely to invest in the absence of such alignment and therefore often support management. This support is not automatic, however, and each resolution is assessed on a case-by-case basis:

• Our voting analysts review meeting materials and relevant information and then make a recommendation to the investment manager.
• The investment manager makes the final decision on behalf of the relevant strategy.
• Where we vote against management, we seek to notify the company and explain our rationale.

This frequently prompts constructive dialogue on strategic issues, including governance and sustainability matters. When we communicate with companies before or after votes, we are transparent about the size of our holding and our voting authority. Where no legal or regulatory restrictions apply, we will also provide investee companies with information about our holding on behalf of clients.

Breakdown of votes against management

Where we most often vote against management

As the chart below illustrates, votes against management's recommendation typically fall into five broad categories:

1. Director-related matters
2. Remuneration
3. Capital management
4. Auditor-related matters
5. Shareholder resolutions

This is explored in more detail later in this chapter.

More information about our approach is set out in our Proxy Voting Guidelines, and our full voting record is available on our website.

%

Data as at 31 December 2025. Figures may not sum due to rounding.

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Stewardship principle spotlight

Governance fit for purpose

We believe there is no single governance model that delivers the best long-term outcomes. We remain receptive to various governance approaches and place trust in the boards and management teams of the companies we select, while insisting on accountability should that trust be compromised.

In March 2020, Italy enacted emergency legislation in response to Covid-19, allowing companies to hold shareholder meetings behind closed doors. Companies are required to designate a representative to participate on behalf of shareholders; however, shareholders themselves are not permitted to attend either in person or virtually. This legislation, which remains in force, diverges from practices in many other jurisdictions. The legislation also enables companies, subject to shareholder approval, to amend their articles to adopt this meeting format in perpetuity. Several of our Italian holdings continue to hold closed-door meetings. When querying this with investee companies, they have often cited increased efficiency and competitiveness as justification. The ability to attend shareholder meetings is a fundamental right that fosters transparency and accountability. While shareholders may not always exercise this right, its availability is crucial in exceptional circumstances and serves as an important escalation tool.

The ability to attend shareholder meetings is a fundamental right that fosters transparency and accountability. While shareholders may not always exercise this right, its availability is crucial in exceptional circumstances and serves as an important escalation tool.

In 2024, we opposed several proposals to permit these closed-door meetings indefinitely. In instances where such formats persisted, we escalated our response by opposing the financial statements in 2025 and communicating our concerns regarding reduced transparency and accountability to the board chairs of several Italian investee companies. We indicated the possibility of further voting escalation in 2026 should these practices continue without adequate justification.

Following shareholder pressure, at the end of 2025, the European Commission opened infringement proceedings against Italy, citing closed-door meetings as an incorrect transposition of the Shareholder Rights Directive. We are monitoring regulatory developments closely and our engagements with investee companies are ongoing.

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Proxy voting case studies and outcomes

Roblox

© Shutterstock/Miguel Lagoa

Stewardship principles

Governance fit for purpose

Roblox is a US-incorporated gaming platform company. At its 2025 annual general meeting (AGM), shareholders were asked to approve a proposal to reincorporate from Delaware to Nevada. This topic has become more prominent across founder-led, dual-class US companies. Ahead of the vote, we held a call with the company's chief executive officer (CEO), chief financial officer (CFO) and legal team to understand the board's rationale and the governance trade-offs for long-term shareholders.

Roblox’s management team explained that they had assessed multiple jurisdictions (including Delaware, Nevada and Texas), and that the decision to choose Nevada was primarily driven by a desire for a more predictable legal framework to support the company’s long-term strategy. They argued that Delaware’s traditional strengths of deep case law and Chancery Court precedent have, in their view, become less reliable due to unpredictable judicial reinterpretations. By contrast, Nevada’s statute-based approach provides more clarity in advance. Additional factors raised included Delaware’s low threshold for books-and-records requests under Section 220, which they associated with rising costs from unmeritorious litigation. In determining our voting intentions, we considered this alongside our own comparative assessment of shareholder protections and the company's governance context. While we remained mindful of potential implications for minority shareholder rights, we ultimately found the company's rationale compelling and therefore supported the reincorporation proposal.

Continuously held since: 2022 Holding as at end 2025: 3.20 percent

In determining our voting intentions, we considered this alongside our own comparative assessment of shareholder protections and the company's governance context. While we remained mindful of potential implications for minority shareholder rights, we ultimately found the company's rationale compelling and therefore supported the reincorporation proposal.

Outcome

The proposal passed after receiving approximately 70 percent support, which we believe to be in the best interests of all shareholders. However, we will continue to monitor how the company uses the flexibility provided by the new legal framework to ensure that outcomes are aligned with our clients' long-term interests.

Kao Corporation

Stewardship principles

Governance fit for purpose

© Shuttarou - stock.adobe.com

Kao Corporation is a Japanese consumer goods manufacturer producing beauty, healthcare and household products, and chemicals.

In 2025, an activist shareholder submitted eight proposals for voting at the AGM, advocating for the appointment of additional independent directors and changes to executive and non-executive remuneration. We are a supportive, long-term shareholder of Kao, but we also recognise that it has faced challenges with its supply chain management, overseas expansion and cosmetics business. We were therefore open to considering the potential value of introducing fresh perspectives and challenge to the board. The board recommended opposing all items, while the activist argued that its director nominees would bring international fast-moving consumer goods experience to the board and strengthen governance, leadership and alignment.

After meeting with both the management team at Kao and hearing a presentation from the activist, we concluded that there was value in introducing specific additional external perspectives and increasing constructive challenge on the board. Accordingly, in addition to supporting all company-nominated directors at the AGM, we supported two shareholder-nominated candidates. We believed their expertise in financial planning, pricing optimisation and supply chain transformation would be particularly relevant to the company. To ensure the appropriate level of incentivisation was in place for a larger board, we also supported the shareholder proposal to increase the aggregate fees for non-executive directors.

Continuously held since: 1997 Holding as at end 2025: 0.41 percent

To ensure the appropriate level of incentivisation was in place for a larger board, we also supported the shareholder proposal to increase the aggregate fees for non-executive directors.

Outcome

None of the shareholder proposals passed, although some that we supported attracted more than 20 percent support. Following the AGM, we wrote to the company explaining our approach and our view that its current midterm plan could be more ambitious. The company acknowledged our position and said this would be passed to the board. We subsequently met with an independent outside director at Kao, as part of the company's post-AGM outreach. Gaining access to independent directors in Japan is, generally, a relatively new phenomenon and one we view positively, as it affirms confidence in the calibre of a company's board members. We learned that the board had received our letter and appreciated the rationale for our approach. It also provided a valuable opportunity to discuss our voting approach and board dynamics further, and to encourage greater ambition in strategic and financial targets.

The AGM and subsequent meetings have helped to deepen our relationship with the board and confirmed shared recognition of the need for greater ambition, setting the stage for further engagement in the next planning cycle.

Reliance Industries Limited

© sdx15 - stock.adobe.com

Stewardship principles

Sustainable business practices

Reliance Industries Limited is an Indian conglomerate operating globally across hydrocarbon exploration and production, oil and chemicals, and retail and digital services.

We have been encouraging the company to enhance its emissions disclosure for some time, highlighting areas where we believe increased disclosure would be beneficial to the market and aligned with emerging global best practice, particularly given its leading position in India's oil and gas industry. We have asked the company to disclose its Scope 3 (value chain) emissions, whether it has considered setting a quantitative methane-intensity target, and whether it will commit to zero routine flaring by 2030, in addition to discussing its net zero carbon ambition in relation to its New Energy Plans.

Continuously held since: 2001 Holding as at end 2025: 0.22 percent

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Outcome

The resolution passed and the director was re-elected. We recognise that, as minority shareholders we have limited influence, however we still believed that voting action was the most appropriate course of action and an important signal. We communicated our rationale for the voting decision and continue to monitor progress as our engagement with the company remains ongoing.

The July extraordinary general meeting (EGM) provided an opportunity to escalate due to a lack of progress regarding the above points. We have appreciated the company's engagement with us on this topic, but as the disclosures fall short of our minimum expectations for the sector, we opposed the reappointment of one executive director, given his role as chair of the ESG committee.

argenx

Stewardship principles

Long-term value creation Alignment in vision and practice Continuously held since: 2019 Holding as at end 2025: 1.60 percent

argenx is a European immunology company developing antibody based therapies for severe autoimmune diseases. As the business has scaled from research and development (R&D) into a global commercial operation, it now competes for executive and scientific talent across both Europe and the US. We have been a long term, aligned shareholder since 2019, including providing primary capital.

In May 2025, argenx sought shareholder approval at its AGM for a remuneration policy that blended European and US characteristics. Our view was that the proposed remuneration policy aligned with our Executive Remuneration Principles, which favour radically simple, long-duration equity structures that align reward with long-term value creation. Through this lens, we assessed argenx's proposed, transatlantic-calibrated remuneration policy as fit for purpose for a European issuer competing in US healthcare talent markets, and as strongly aligned with long-term shareholder outcomes.

Under Dutch law, the vote was binding and required 75 percent support to pass, so implementing the proposed policy depended on clearing a high support threshold. In recognition of this, ahead of the AGM, we publicly signalled our support and voted for the policy, explaining why a design that is unusual in Europe could nonetheless promote long-term shareholder outcomes when coupled with robust alignment and ownership expectations.

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voted for the policy, explaining why a design that is unusual in Europe could nonetheless promote long-term shareholder outcomes when coupled with robust alignment and ownership expectations

Following a result of only 73 percent support, the company engaged further with shareholders and refined aspects of the policy. To reiterate our public support for the policy, we issued an additional statement ahead of the November EGM, noting the company's responsiveness to investor feedback and its need to remain competitive in a global market while sustaining alignment with long-term performance.

Outcome

While the remuneration policy failed to secure sufficient support to pass at the AGM, it was subsequently approved with 95.7 percent support at the EGM following additional shareholder engagement and refinements to the policy. We will continue to monitor application, disclosure and long-term alignment as the company continues to scale and grow.

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Engagement

Engaging with the assets we hold on clients' behalf is central to our role as stewards of their capital and forms a core part of our research process (see Our Stewardship Principles and Guidelines for more information). We engage with companies to fact-find, assess and, where that is in clients' long-term interests, to influence (explained in more detail in 2025 engagements: in numbers).

Our approach is deliberately patient. Building trusted relationships takes time, but it allows for more candid, informed conversations and a better understanding of less tangible drivers of long-term success – such as leadership quality and corporate culture. This long-term, two-way dialogue also creates the conditions for change when it is needed. We believe sustained engagement on strategic issues can protect and enhance clients' long-term returns, consistent with our investment beliefs, firm culture and client needs.

We typically engage directly with companies on a one-to-one basis. However, we also recognise that collaboration can sometimes be the most effective way to make progress. Working alongside like-minded investors and, where appropriate, broader stakeholder groups, can amplify our voice on behalf of clients and may be necessary to achieve specific engagement objectives. Examples of collaborative engagement during the year are provided on page 55. In collaborating with others (including when we participate in industry groups), we will always exercise our own independent judgement and make decisions unilaterally, within the parameters set by our clients' mandates, and will not be constrained by the directions of others. In addition, regardless of any memberships or participation in collaborative initiatives, we act independently in the exercise of our investment and stewardship activities.

In collaborating with others (including when we participate in industry groups), we will always exercise our own independent judgement and make decisions unilaterally, within the parameters set by our clients' mandates, and will not be constrained by the directions of others. In addition, regardless of any memberships or participation in collaborative initiatives, we act independently in the exercise of our investment and stewardship activities.

Engagement priorities are not fixed. They differ by issuer and by strategy, shaped by our proprietary research and the material issues within each investment case. Given our long-term investment horizon, we also expect topics of systemic relevance to feature when pertinent.

In 2025, we continued to meet with companies both in person and virtually. We value the insight that comes from visiting operations and speaking directly with management and employees, while also recognising the accessibility and efficiency of virtual engagement. We therefore maintain an open channel for planned and ad-hoc dialogue in all appropriate formats, including meetings, written communication and collaborative forums.

Examples of our 2025 engagements are set out later in this chapter. You can also find more information on our engagement approach in Our Stewardship Principles and Guidelines on our website.

2025 engagements: in numbers

• In 2025, we had 1,769 meetings and/or calls with the companies in our portfolios. These ranged from group calls with other investors to one-on-one meetings with executives or board members to improve our understanding of our holdings and progress our engagement objectives. We do not record all these interactions as engagements, as many are routine exchanges over the normal course of business as a shareholder. We regard an interaction as an engagement where there was a specific intent:
• to fact-find on a specific topic, be that a material governance, strategic, and/or sustainability matter;
• to assess a company's progress in a certain area, such as in relation to targets it has set or an area for improvement we have previously engaged on;
• or to influence on an issue where we feel the company needs to change or improve.
• Using this definition, we had 522 engagements with companies in 2025. We do not set targets for a specific number of engagements during the year. While our engagement activity may fluctuate as we refine our processes over time, we prioritise purposeful engagement, focusing on the issues most material to long-term value and set clear expectations for what we seek to achieve. The topics covered in these engagements are broken out by category in the table below. The spotlight and engagement highlights that follow provide more detail around some of these engagements, outcomes and next steps. As we often discuss multiple topics during each engagement, the total in the following table exceeds the total number of engagements.

Our engagements

Figures may not sum due to rounding.

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Engagement highlights

The following section presents examples of active and closed engagements undertaken throughout the year. We have chosen these examples to showcase the range of topics we might engage on with issuers, how our focus will differ depending on geography and asset type, and the variety of outcomes that might result from an engagement. The content relates to material issues discussed at a point in time and, as such, the examples are not intended to present a full suite of issues that we discuss with issuers over the time horizon of our investments.

An engagement is considered closed where we have either achieved our stated objective, concluded that further influence is unlikely to be effective, or incorporated any residual risk into our investment decision-making. Where progress is limited, we consider escalation tools consistent with our stewardship approach.

Spotlight on

Our Engagement Hub

In our 2024 report, we announced the development and implementation of our Engagement Hub, a proprietary system that provides a firmwide view of the details and status of engagement objectives. This enables investment teams to record engagement priorities, anticipated timelines, desired outcomes and track progress throughout the lifecycle of engagements.

Over the last 12 months, we have continued to roll out the Engagement Hub, which has improved transparency and collaboration across the investment floor and facilitated better coordination of our stewardship activities. Over time, we expect to leverage the information in the hub further to support more focused and insightful client reporting on progress against engagement objectives.

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Burberry Group plc

Stewardship principles

Governance fit for purpose

Continuously held since: 2011 Holding as at end 2025: 1.69 percent

Burberry is one of the UK's best-known luxury brands, famous for its classic outerwear and iconic British identity. Baillie Gifford has been a significant shareholder since 2011. Over the last decade, we have supported Burberry's strategy to elevate its brand by aligning its distribution and product range with a luxury positioning, underpinning long-term sustainable growth and value creation. Continuously held since: 2011 Holding as at end 2025: 1.69 percent

© iStockphoto.com/gioadventures

Engagement objectives

To understand the reasons for management change and implications for Burberry's strategy

Status

Ongoing

At a glance

Setting the scene

What did we do?

In recent years, Burberry has set out its strategy to reposition itself at the higher end of the luxury market. Its focus has been on ‘premiumisation’, making the brand feel more high-end by moving into higher-margin products such as leather goods and doubling down on its British identity. However, in mid-2024, amid a very challenging demand backdrop for the luxury goods industry, Burberry issued its fourth consecutive profit warning and suspended its dividend. Shortly after, the CEO was replaced without warning. This sudden change prompted us to question whether the company was about to change direction and whether it remained on track to deliver its long-term premiumisation plan.

Following several profit warnings and a sudden CEO departure, we engaged with members of the board to gain further insight into what was happening at the company, assess the impact on board effectiveness and ensure its premiumisation strategy remained on track.

Why does it matter?

Management and the board are vital to the successful execution of the company’s premiumisation strategy and, ultimately, the value generated for shareholders. A sudden change in leadership risks derailing this, which could be detrimental to our investment case.

What was the outcome?

Our confidence in Burberry's strategic direction and the conviction in our investment case remain intact. We will seek to engage with the incoming chair once they are confirmed to build our understanding of board dynamics.

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Our engagement journey

July

After Burberry issues a profit warning, the company announces that Jonathan Akeroyd will step down as CEO and will be replaced, with immediate effect, by Joshua Shulman.

We speak with the chair and CFO, requesting a further call with the senior independent director (SID).

We speak with the SID to understand the circumstances of the CEO's departure.

These conversations make clear that the board believes that the exiting CEO had not effectively driven strategy execution and that fixing this would require a CEO change.

September

We meet the new CEO and CFO in London. Our discussion focuses on the CEO settling in, his views on long-term strategy and the necessary changes to return the company to a path of sustainable growth.

November

We provide feedback on remuneration arrangements for the new CEO ahead of the 2025 AGM.

Outcome and next steps

Our engagements with the company have given us confidence that management is well-positioned to deliver on its long-term premiumisation plan. If this is successful, we believe that the current valuation does not reflect the strength of this unique brand. We view recent management changes as positive and plan to engage with the incoming chair, once appointed, to outline our ongoing stewardship expectations.

2025

February

We meet with the board chair, continuing the dialogue on how the CEO is settling in and discussing his remuneration arrangements. We also hear that two recent joiners, Jonathan Kimian, chief marketing officer (CMO) and Paul Price, chief product merchandising and planning officer (CPMPO), have been working well with the rest of the executive team.

April

Burberry announces it is searching for a new board chair.

July

We support management at the AGM and welcome the appointment of Stella King as a new non-executive director, bringing valuable luxury sector experience.

September

We make a modest increase to our position.

October

We hold our annual due diligence day, meeting with the CEO and finance director, as well as other members of the executive team, including the CMO and CPMPO. The visit provides further reassurances around strategy alignment and improved execution in the future.

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Enel SpA

Stewardship principles

Governance fit for purpose Long-term value creation Alignment in vision and practice

Continuously held since: 2023 Holding as at end 2025: 0.01 percent1

・・・・・・・・・・・・

Enel is one of the world's largest private renewable energy operators, with a global portfolio of over 1,300 projects. Our investment case is built on its central role in the energy transition, scale, and commitment to decarbonisation. With effective management of operational risk, Enel's leadership in renewables positions it to benefit from the accelerating shift away from fossil fuels, while its integrated business model and geographic diversification provide resilience and growth opportunities.

Engagement objectives

© StockMarketVisuals - stock.adobe.com

At a glance

What did we do?

We engaged with the European Federation of Public Service Unions (EPSU) to benchmark credible health and safety standards and assess Enel's approach. At the AGM, we opposed the remuneration policy, as the revised metric would not, in our view, offer a more effective or transparent means of assessing health and safety performance. We broadened our engagement to cover workforce safety amid climate risks and to draw on lessons from the Osage Nation ruling, including how Enel will manage future community- and permitting-related risks.

Why does it matter?

Effective management of social issues is central to Enel's social licence to operate and long-term value creation. Fatalities and high-consequence incidents carry significant human and reputational costs; strong workforce health and safety performance is a core social issue for Enel, underpinning trust with employees, communities and other stakeholders. As climate risks intensify, the ability of safety practices to adapt becomes increasingly material, shaping current and future operational performance and resilience. Effective community engagement and respect for human rights, including those of Indigenous peoples, help mitigate conflict, reduce delays and limit value leakage.

a core social issue for Enel, underpinning trust with employees, communities and other stakeholders. As climate risks intensify, the ability of safety practices to adapt becomes increasingly material, shaping current and future operational performance and resilience. Effective community engagement and respect for human rights, including those of Indigenous peoples, help mitigate conflict, reduce delays and limit value leakage.

What was the outcome?

While the remuneration policy was approved, we reinforced the importance of maintaining a clear link between incentives and fatalities and safety outcomes. Enel outlined initial measures to manage heat and air-quality risks for workers, which we will assess as they scale globally. The company also described enhanced community engagement and risk identification following the Osage project, the effectiveness of which we will continue to monitor.

1 We also had a bond holding over the same period, before selling in November 2025. As such, this was a collaborative engagement coordinated across our equity and bond investment strategies.

Setting the scene

We have been engaging with the company on workforce health and safety since we took a holding in 2020. These discussions have led us to acknowledging Covid-related pressures and the ongoing challenge of progressing towards its zero-fatalities target. Deaths in 2024 represented the highest of the past decade, increasing the urgency of understanding and assessing remedial actions.

In parallel, we have assessed how climate change may require companies to reshape health and safety practices. This prompted an exploratory discussion on how Enel is adapting safeguards in a more unpredictable, climate-impacted operating environment, while ensuring workforce resilience. In December 2024, a ruling by the US Court of International Trade found that Enel's wind project had infringed the Osage Nation's mineral rights and ordered the company to remove the existing installations, potentially at a significant cost to the firm. While the company has appealed and the outcome is pending, the event raised questions about the effectiveness of Enel's community engagement and human-rights processes, and the potential for avoidable operational risk.

In December 2024, a ruling by the US Court of International Trade found that Enel's wind project had infringed the Osage Nation's mineral rights and ordered the company to remove the existing installations, potentially at a significant cost to the firm. While the company has appealed and the outcome is pending, the event raised questions about the effectiveness of Enel's community engagement and human-rights processes, and the potential for avoidable operational risk.

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Our engagement journey

April

Our monitoring indicates that fatalities continue to rise relative to the last time we raised concerns with the company in 2021.

December

Osage Nation ruling relating to permitting/mineral rights.

Outcome and next steps

Health and safety

In a sector where high-voltage, field and contractor work inevitably creates safety challenges, Enel's framing of health and safety as a core value, backed by disclosed injury-frequency indicators and reduction targets, is encouraging. We will continue to press for alignment between its zero-fatalities ambition, operational controls, and executive incentives. Before the next AGM, we plan to engage with the board on health and safety and on how employee feedback is incorporated into this, as well as into remuneration design.

2025

January

We review Enel's public response to the Osage Nation Ruling. Our research highlights additional projects with potential Indigenous rights sensitivities.

May

We vote against the renewed remuneration policy at the AGM due to concerns about weakening the link between health and safety and executive incentives.

June

We consult the EPSU on sector standards and peer benchmarking.

August

We meet with investor relations (IR), reiterating our support for Enel's zero-fatalities ambition and share the rationale for our AGM vote. From our engagement with the EPSU, we encourage Enel to embed workforce input into policy design to strengthen compliance and outcomes.

Enel shares early climate-related safety measures, linked to heat/air pollution.

October

We follow up on outstanding questions regarding project management and human rights, and request board engagement on health and safety.

November

We receive a response from IR addressing our outstanding questions, which we find satisfactory.

Environmental/social integration

Enel is in the early stages of adapting workforce protections as physical climate risks evolve. We will monitor implementation across regions, with a focus on contractor standards and evidence of consistent practice.

Indigenous rights

The Osage case underscores the need for robust community engagement and respect for Indigenous rights across Enel's project pipeline operations. To support long-term value, we will track how lessons learned are embedded into policy and project planning, and test effectiveness by monitoring execution at sites with elevated social or permitting risk.

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Eurofins Scientific

Stewardship principles Governance fit for purpose Continuously held since: 2023 Holding as at end 2025: 0.26 percent

Eurofins Scientific is a Luxembourg-based global leader in laboratory testing, operating in a highly decentralised structure with hundreds of subsidiaries. Our investment in Eurofins is underpinned by its strong founder-led culture and impressive track record of value creation.

Engagement objectives

At a glance

What did we do?

We engaged with Eurofins' management and board, encouraging them to broaden the board's experience and increase its independence. This has included a mix of direct meetings and written correspondence with the company.

Why does it matter?

Strong, independent governance is vital for protecting minority shareholders, especially in founder-led businesses with complex structures, and for supporting long-term value creation. We had concerns regarding the level of independent oversight on the board, views which were echoed in the market.

What was the outcome?

The company appointed a new independent non-executive director (NED) in March 2025, somewhat addressing our concerns. We recognise that change takes time and will seek to engage with the company in the year ahead to see how the new director is settling in and providing effective challenge.

Setting the scene

We're often drawn to founder-led businesses for their vision and drive. Our investment in Eurofins is backed by the vision of its founder, Gilles Martin. However, given the founder holds the chair and CEO roles, robust governance is essential, particularly as the company expands internationally and faces new challenges.

The company has been criticised for its board independence and broader governance practices, especially after a short seller report in 2024 raised questions about oversight and related-party transactions.

Before taking a holding, we recognised that Eurofins' board was heavily weighted towards Luxembourg, with limited international experience and few independent voices. While this structure had served the company well in its early years, we believed this could present a risk as the company grew.

Our stewardship journey with Eurofins has been one of constructive challenge and patient dialogue. We discussed succession planning and board composition in 2023 and 2024, emphasising the merit of having independent voices and a wider range of experience on the board. We made it clear that board independence is not a box-ticking exercise but rather supports board effectiveness and can be fundamental to long-term value creation.

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Our engagement journey

Outcome and next steps

Governance improvements

We welcomed the appointment of Gavin Hill as an independent non-executive director at the 2025 AGM. Hill was known to us through his role as CFO at another company we invest in on behalf of clients, allowing us to draw on insights from colleagues who had previously engaged with him and giving us additional confidence in his suitability for the role at Eurofins. Alongside this appointment, we remain focused on succession planning for the founder-CEO and on ensuring robust arrangements are in place to support long-term leadership continuity.

We will continue to engage on these matters, including seeking to understand how the introduction of a new independent NED has influenced board dynamics.

During the year, the company also strengthened its governance framework through the implementation of a Related Party Transactions Policy, requiring the Sustainability & Corporate Governance Committee to be notified of, and then assess, any forthcoming transactions. Eurofins further committed to offering shareholders a vote on related party property acquisitions, reflecting improved transparency and accountability.

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LVMH

Stewardship principles Sustainable business practices

Continuously held since: 2020 Holding as at end 2025: 0.08 percent

LVMH is the world's largest luxury goods group. It represents more than 75 brands, or Maisons, including Louis Vuitton and Dior. Our investment case is grounded in the group's exceptional brand-building and capital allocation capabilities, which are overseen by its long-term owner-manager, Bernard Arnault. Continuously held since: 2020 Holding as at end 2025: 0.08 percent

Engagement objectives

© Imaginechina Limited/Alamy Stock Photo

At a glance

What did we do?

Following labour exploitation cases in the Italian luxury supply chain, we consulted external experts in 2024 to understand structural risks and inform our approach. In 2025, we engaged directly with LVMH, focusing on audit integrity, industry collaboration and the benefits and trade-offs of bringing more production in-house (vertical integration) to mitigate supply-chain risks.

Why does it matter?

The brand equity of LVMH Maisons rests on narratives of craftsmanship and technical expertise, with safe and fairly paid work an implied part of the luxury promise. Our research and engagement aim to assess whether the group's overall approach and ambition regarding labour rights due diligence in Italy aligns with the scale and systemic nature of the risk.

Status

Ongoing

What was the outcome?

The company has enhanced supply chain oversight, strengthening audit integrity by replacing third-party auditors, increasing unannounced audits and improving disclosure, supported by a new internal platform to share audit results across Maisons.

LVMH is actively contributing to a cross-industry supplier certification platform in Italy, helping address structural labour-rights risks and encouraging consistent standards across brands.

It is investing in additional in-house manufacturing capacity and bringing in experienced talent to safeguard craftsmanship and reduce supply-chain risks.

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© winhorse/Gett Images

Setting the scene

The luxury sector’s shift towards higher volumes and greater product ranges has increased reliance on outsourced manufacturing, particularly for ready-to-wear garments, with multiple tiers of subcontractors. Italy’s textile sector is highly fragmented, with many small factories spread across regions, leaving suppliers with limited bargaining power compared to global brands. Many rely on migrant workers, often on part-time contracts and outside union protection, in a system with no statutory minimum wage and enforcement largely via sector-specific collective bargaining.

In June 2024, Italian authorities placed a Dior subsidiary under judicial supervision after uncovering labour exploitation among its suppliers, including ‘ghost’ suppliers operating outside the law and using undocumented migrant workers. Similar findings led to enforcement action against LVMH’s Loro Piana brand approximately one year later. Italian operating companies behind the Maisons of Dior and Loro Piana have since been subject to judicial administration, in which a court-appointed commissioner sits within the company for up to a year, reviewing procurement, supplier selection and audit processes, and reporting to the court. It provides the state with a direct view into how orders are placed and who actually performs the manufacturing, beyond mere code-of-conduct statements.

Italian operating companies behind the Maisons of Dior and Loro Piana have since been subject to judicial administration, in which a court-appointed commissioner sits within the company for up to a year, reviewing procurement, supplier selection and audit processes, and reporting to the court. It provides the state with a direct view into how orders are placed and who actually performs the manufacturing, beyond mere code-of-conduct statements.

Although the ‘Made in Italy’ label has been synonymous with quality and craftsmanship, these scandals exposed a fragmented supply chain that is open to exploitation. Against this backdrop, we consulted external experts in 2024 to understand the structural challenges, then engaged directly with LVMH in 2025, focusing on audit integrity, industry collaboration and the benefits and trade-offs of vertical integration.

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Our engagement journey

..... December

We begin researching luxury sector supply chains, consulting experts with decades of experience in Italian textile manufacturing and labour rights. This helps us frame our engagement and understand the nuances of local supply chain dynamics.

2025

February

The judicial supervision of Dior’s manufacturing unit is lifted early, with Italian authorities praising the interventions, removing the near-term legal risk.

May

We participate in an investor group meeting at the Kepler ESG conference, hearing that the CEO oversaw LVMH's response, which initially focused on measures to address audit integrity. It included terminating relationships with offending suppliers, contracting new third-party auditors and increasing the frequency of unannounced audits. We learn that the company had also rolled out an internal platform to share audit resources and results across Maisons.

June

We speak with LVMH's ESG IR manager, who is candid about the challenges and open to future dialogue. We discuss the company's involvement in a voluntary certification platform, a new cross-industry supplier database in Italy.

July

Similar supply chain issues surface at Loro Piana, another LVMH brand, prompting further enforcement action by the Italian authorities and underscoring the systemic challenges facing the ‘Made in Italy’ supply chain.

LVMH creates a group-wide director of industrial and craftsmanship, reporting to the group managing director. This represents an evolution in the LVMH group's governance mechanisms to provide oversight of the supply chain.

December

We receive an update on the supplier protocol and explore scaling challenges during a follow-up engagement. We are encouraged to hear of the practical cooperation between brands sharing audit data.

Outcome and next steps

Improved audit integrity

LVMH has appointed new third-party auditors, increased unannounced audits, and updated its supplier codes of conduct. The sharing of audit resources and results across its Maisons, and also with peers, is a pragmatic approach to reducing exposure to hidden labour abuses. These steps have been complemented by improved disclosure, offering more detail on the company's supply chain oversight and approach toward addressing labour rights risks. We will continue to engage with the company to assess the effectiveness of these audit process enhancements.

Supporting industry-wide collaboration

A central certification platform for the Lombardy region in Italy will provide a ‘status’ for suppliers that are willing and able to submit compliance documents twice annually. A centralised system will mean suppliers will not need to meet different checks and requirements from multiple brands. This could address the root causes of the issues, although it is voluntary and will require continued buy-in from brands.

Expansion of Group oversight of manufacturing

LVMH is selectively increasing in-house manufacturing capacity to preserve artisanal skills and invest in human capital. The calibre of experienced hires into Dior's new Industrial division and the establishment of the Group-wide Director of Industrial and Craftsmanship also send encouraging signals on increased oversight mechanisms.

© hippomyta - stock.adobe.com

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Zijin Mining Group

Stewardship principles Sustainable business practices

Continuously held since: 2020 Holding as at end 2025: 1.37 percent

Zijin Mining is a leading Chinese mining company with a global footprint. It produces metals, such as copper, gold, lithium and zinc, which are critical to the energy transition, and few companies are as pivotal to global supply as Zijin. We first invested in the company in late 2020. Our investment case recognises the company's growth potential, the significant governance and sustainability risks inherent in mining (especially for companies operating in complex jurisdictions) and the opportunity for the company to continue improving.

Engagement objectives

© Timon - stock.adobe.com

At a glance

What did we do?

We launched a three-year engagement to deepen our understanding of the company's historical social and environmental incidents and to push for improvements aligned with international standards. We set clear objectives and timelines, established and maintained regular dialogue, attended site visits, sought external expert input and called for transparent audits. We engaged with a third-party rating provider to understand how it was scoring Zijin in its controversy assessments.

Why does it matter?

Our stewardship philosophy is rooted in the belief that persistent, constructive engagement can drive meaningful change, even in challenging sectors. Zijin stood out for its global footprint, the materiality of its operations and the opportunity to continue improving. For miners, the complexity created by operating in remote areas and countries with varying governance standards can create additional opportunities and challenges. For investors, robust social and environmental practices are essential for unlocking long-term value and ensuring appropriate risk management to maintain the social licence to operate. As global demand for copper rises, miners face heightened scrutiny, especially regarding the safety of their operations, human rights and transparency.

by operating in remote areas and countries with varying governance standards can create additional opportunities and challenges. For investors, robust social and environmental practices are essential for unlocking long-term value and ensuring appropriate risk management to maintain the social licence to operate. As global demand for copper rises, miners face heightened scrutiny, especially regarding the safety of their operations, human rights and transparency.

What was the outcome?

We concluded the engagement in September 2025 after observing tangible progress in transparency and disclosure, external validation, governance practices and third-party assessments, as well as a firmer foundation for future monitoring.

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Setting the scene

Before taking a holding, third-party data providers had assessed the company's approach in specific mine sites as not aligned with the United Nations Global Compact (UNGC), which included Principle 2 (businesses should ensure they are not complicit in human rights abuses) and Principle 7 (businesses should support a precautionary approach to environmental challenges). During the course of our engagement, one third-party assessor upgraded its status, while another added Principle 4 (businesses should uphold the elimination of forced and compulsory labour). As a state-owned enterprise with operations spanning continents, it faces scrutiny from various stakeholders. Our position as a minority investor meant that building trust and credibility was essential. With more than three decades of experience investing in emerging markets, and by leveraging our regional expertise in Shanghai, we were able to foster a constructive relationship and gain valuable insights into the company's evolving approach to key topics.

Our engagement journey

As a state-owned enterprise with operations spanning continents, it faces scrutiny from various stakeholders. Our position as a minority investor meant that building trust and credibility was essential. With more than three decades of experience investing in emerging markets, and by leveraging our regional expertise in Shanghai, we were able to foster a constructive relationship and gain valuable insights into the company's evolving approach to key topics.

Outcome and next steps

The three-year engagement was closed in September 2025 with the following outcomes:

Human rights

The company expanded training and grievance mechanisms across global operations, including Serbia and the Democratic Republic of the Congo (DRC).

External validation

Audits referenced national Chinese standards, with Ashele Copper receiving a ‘B’ rating for social responsibility. We then reviewed the equivalence with other national and international standards and were reassured by the alignment. It was also a helpful reminder of why understanding national priorities is important. We understand that the company is also actively seeking more external validation for its overseas mining sites.

Transparency

Zijin disclosed results from independent audits at its Ashele Copper and Xinjiang subsidiaries, meeting a key task from Baillie Gifford. The company also facilitated site visits for domestic and foreign investors, allowing us to engage directly with local communities and see its operations first-hand. We were satisfied with the company's direction of travel and the improvements that have been made.

Growth

The company has demonstrated remarkable operational and financial growth over the past few years, establishing itself as a leading global mining company with particularly strong performance in copper and gold production. During our engagement period, Zijin Mining has risen to now being one of the three largest miners globally by market cap.

Looking ahead

We remain invested in the company, reflecting our conviction in its direction of travel. We will continue to monitor progress and encourage further improvement in its disclosure, re-engaging if material matters arise.

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Rio Tinto

Stewardship principles

Long-term value creation Sustainable business practices Governance fit for purpose

Continuously held since: 2003 Holding as at end 2025: 0.55 percent

Rio Tinto is one of the world's largest diversified mining companies, with operations spanning iron ore, copper, aluminium and critical minerals. It is dual-listed on the Australian Securities Exchange (ASX) and the London Stock Exchange (LSE). Our investment case is built on the company's exposure to long-term structural trends, such as the energy transition and urbanisation, balanced by a recognition of the sector's complex risks. These factors can influence long-term cash generation through commodity demand and pricing, operating costs, access to future growth projects, and the cost of capital.

© 2016 Rio Tinto

Engagement objectives

Encourage the company to strengthen the ambition of its Climate Action Plan (CAP) and monitor the progress of its implementation

Assess the appropriateness of the company's dual-listed structure amid activism at the AGM

Assess the company’s ability to minimise business interruption and productivity loss through physical risk adaptation and resilience measures

At a glance

What did we do?

We engaged with the company on its CAP, focusing on transition planning, physical risk adaptation and resilience to support long-term value. We also assessed the merits of an activist investor's proposal for an independent review to unify Rio Tinto's dual-listed structure versus the long-term interests of our clients.

Why does it matter?

The company’s success is closely linked to the energy transition through market demand for and pricing of the metals it produces, as well as its ability to manage exposure to physical climate hazards in the regions where it operates. As a result, climate adaptation and workforce wellbeing are becoming increasingly important drivers of operational productivity, particularly in the context of extreme heat. Strategic transparency on these issues is important for our capacity to evaluate the company’s long-term investment requirements and how perceptions of risk and return may affect valuation. Additionally, the proposed single listing restructure could affect capital flexibility, add complexity and cost, and create ownership friction.

What was the outcome?

The company improved its CAP, increasing transparency and engagement regarding future investments in downstream steel decarbonisation and transition metals, clarifying its views on possible future climate scenarios, and increasing disclosure on corporate lobbying and alignment. This helps us assess the company's positioning and the resilience of future cash flows across different commodity demand and policy pathways. We supported the renewed CAP at the 2025 AGM and will continue to monitor delivery. We opposed the activist's unification proposal after reviewing the benefits and trade-offs. After initial discussions in 2025, we are continuing dialogue on physical risk and adaptation.

Setting the scene

Over the course of our ownership of Rio Tinto, we have engaged on a wide range of governance and sustainability considerations, including board composition, community relations and mine safety. We have been speaking to the company about its approach to environmental risks and opportunities for more than ten years, and this has been a particular focus area since our opposition to the CAP at the 2022 AGM. This was the first time the company put its CAP to a non-binding advisory shareholder vote and committed to triennial shareholder approval. After discussions with the company, we concluded that the strategy lacked the detail and ambition to be expected of a company with a large market capitalisation operating in a high-impact sector. This assessment reflected the possible risks for Rio Tinto and its impact on stakeholders. We believe that direct risks to the company's operations and any impact on more broadly defined stakeholders – its workforce and local communities, for example – could materially impact long-term investment returns if not appropriately managed. We continued engaging with the company to share our expectations ahead of a renewed shareholder vote in 2025.

This assessment reflected the possible risks for Rio Tinto and its impact on stakeholders. We believe that direct risks to the company's operations and any impact on more broadly defined stakeholders – its workforce and local communities, for example – could materially impact long-term investment returns if not appropriately managed. We continued engaging with the company to share our expectations ahead of a renewed shareholder vote in 2025.

Concurrently, in 2024, activist investor Palliser campaigned for an independent review into unifying share classes under a single listing at the 2025 AGM. Palliser argued that unification would unlock shareholder value and simplify the company's governance structure. We assessed the merit of this proposal and engaged with the company alongside our engagement on the CAP, focusing on the net effect on long-term shareholder value, balancing any potential valuation uplift against management distraction from operating performance and capital allocation decision-making.

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Our engagement journey

December

2022

March

We meet with IR to discuss the CAP. We have a pre-AGM call with the Chair to discuss the CAP.

April

We vote at the AGM, opposing the CAP. We also meet with the new Chair.

December

Participate in a company-organised event to discuss climate-related risks and opportunities.

January

We meet with their lead economist to discuss what energy markets will look like in a decarbonising world.

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February

We meet with the CFO to discuss management's priorities, including accelerating the pace of decarbonisation.

March

We join a call with the board chair to discuss governance and decarbonisation.

May

We meet with the chief scientist to discuss the decarbonisation strategy.

September

We participate in a remuneration consultation and discuss expanding decarbonisation-related metrics in the executive pay plan.

2024

February

We meet with the CEO to discuss the company's strategy, including decarbonisation and its role in the energy transition.

August

We meet with the climate team to discuss the CAP.

Outcome and next steps

Climate Action Plan (CAP)

We supported the revised CAP at the 2025 AGM, recognising specific improvements, including clearer Scope 3 decarbonisation milestones and signposting of climate-related matters as notes to the financial accounts. This supports our assessment of whether the company is making value-accretive investments that preserve competitiveness and avoid value-destructive outcomes such as stranded assets, unexpected capital expenditure or higher operating costs linked to evolving policy and customer requirements.

We continue to monitor progress and how the company is influencing capital allocation in relation to the decarbonisation of downstream emissions. This is particularly relevant for the company's iron ore franchise due to the challenging nature of carbon abatement in the steel value chain and the risk that future pricing and demand for the company's output could be materially impacted by regulation of, and customer sensitivity to, such emissions. We meet with the CFO to discuss company strategy, including capital allocation and decarbonisation.

February

We meet with the CFO to discuss company strategy, including capital allocation and decarbonisation.

March

We meet with IR to discuss the Palliser campaign.

April

At the 2025 AGM, we oppose Palliser’s proposal and support the CAP.

June

We meet with the decarbonisation manager and IR to discuss our support for the CAP and the company, emphasising the long-term economic rationale for decarbonisation.

July

We follow up with the decarbonisation manager on physical climate risk, workforce wellbeing and value chain decarbonisation.

Palliser unification campaign

We voted against the shareholder proposal at the 2025 AGM, aligning with management's view that the costs and risks outweigh the potential benefits. The board and management disagreed with Palliser's claims that the dual-class structure, where some shareholders have more voting powers than others, blocks share-based mergers, and we learnt that the tax costs of unification would be much higher than Palliser had estimated. We were unconvinced that an independent review would add value to long-term shareholders, given that an internal review had been conducted in 2024.

Physical risk adaptation and resilience

Following the improvements seen in the CAP, we are assessing the company's physical risk adaptation and resilience measures. Through our initial engagements, we have learnt that the company has made progress in integrating physical climate risk into business planning and in conducting more detailed scenario analysis. Adaptation planning can reduce the risk of sudden cost shocks or asset impairments over the life of operations, supporting more stable, predictable cash flows. Our engagement is ongoing as we seek to understand the company's actions and progress towards quantifying adaptation costs and sharing best practices across sites better.

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Case study follow-ups

The following pages provide an update on how engagements at a selection of case studies from last year's report have progressed this year. See our 2024 report on our website for full details. Given the multi-year nature of many of our engagements, we have included a selection of highlights rather than updates on all case studies included in our 2024 report.

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Ambu

Stewardship principles

Sustainable business practices Continuously held since: 2016 Holding as at end 2025: 10.72 percent

Continuously held since: 2016 Holding as at end 2025: 10.72 percent

Ambu is a Danish medtech company and a pioneer in the development of single-use endoscopes. These are thin, flexible, sterile tubes with a light and a camera that allow clinicians to see inside the body. These tools are used across multiple medical specialities, reducing the risk of infection, avoiding complex reprocessing and enhancing the reliability of critical healthcare services. We believe that Ambu is well positioned to drive the industry-wide shift from reusable to single-use endoscopes and deliver long-term growth.

Engagement objectives

Status

Ongoing

Ongoing

Why are we engaging?

Next steps outlined in 2024

Single-use endoscopes are well-suited to healthcare systems in emerging markets due to lower infrastructure requirements and improved reliability. However, a key determinant of long-term growth will be the company's execution of its strategy. In 2024, the company appointed a dedicated leader for emerging markets and stated an increased focus on expanding access to its portfolio in the region.

Continue to monitor how the company is addressing emerging markets as a growth opportunity.

As a producer of single-use medical devices, waste and the associated environmental impacts are a key risk for Ambu, particularly given its significant European presence. Failure to manage this could result in future costs to the business and its customers. Equally, having a robust sustainability approach could be a source of competitive advantage.

2025 activities and updates

Emerging Markets strategy

Ambu consolidated its previously fragmented emerging markets activities into a single global team and exited approximately 40 small, complex countries to focus on 19 priority markets, with India serving as a test bed. This reflects a shift from opportunistic expansion to disciplined execution. Ambu is investing directly in local sales presence, clinician training, and health-economic evidence to support reimbursement and repeat adoption, improving the durability of revenues in emerging markets.

Sustainability progress supporting commercial outcomes

Ambu reported that earlier engagement discussions helped shape its sustainability focus. The company has reduced Scope 1 (direct) and 2 (indirect) CO2 emissions by 14 percent per tonne of finished goods and achieved half of its 2030 Science-Based Targets initiative (SBTi) targets. This has been driven by early adoption of bioplastics across its endoscope portfolio and expansion of its Recircle take-back and recycling programme in Europe and the US. Importantly, Ambu highlighted that its improved sustainability credentials have increased competitiveness, contributing to more bids being won as healthcare procurement increasingly favours suppliers with higher sustainability standards.

Outcome and next steps

Ambu’s sharper focus in emerging markets reduces execution risk and improves capital efficiency, while its sustainability progress has delivered measurable emissions reductions and enhanced commercial outcomes through improved tender success.

Looking ahead, our future engagements will focus on supporting Ambu's ability to realise growth in emerging markets and encourage further adoption of sustainability initiatives that we believe will continue to strengthen the company's growth opportunities.

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Grab Holdings Limited

Stewardship principles Sustainable business practices Continuously held since: 2024 Holding as at end 2025: 1.17 percent

Headquartered in Singapore, Grab's 'super app' combines multiple services (ride-hailing, food delivery and digital payments) into one platform across eight countries in Southeast Asia.

© 2p2play - stock.adobe.com

Engagement objectives

Status

Ongoing

Why are we engaging?

2025 activities and updates

Gig workers are central to Grab's business model, yet their employment often carries workforce and regulatory risks. The company's navigation of and response to regulatory developments and potential driver protests is core to maintaining a social licence to operate and is important to our investment case. We are engaging to understand Grab's approach to its driver partnerships and to support the adoption of best practice in labour-market stability, regulatory compliance and partner retention.

Regulatory developments

Next steps outlined in 2024

We planned ongoing engagement with Grab to explore opportunities to implement relevant elements of Fairwork's2 principles related to working conditions and improved driver opportunities.

Labour-market stability, regulatory compliance and partner retention remain a material consideration for investors. Singapore's Platform Workers Act came into effect on 1 January 2025. This requires companies to pay pension contributions and compensation for injuries to gig workers. The International Labour Organisation (ILO) is also developing global standards for platform workers.

Having spoken to Grab, it expects regional regulations to gradually align with Singapore's model. However, progress will be slower in less economically developed markets, such as Indonesia and Vietnam. For example, Fairwork's latest review of Grab Indonesia showed no improvement in its score.

2 Fairwork is a project coordinated by the Oxford Internet Institute and the WZB Berlin Social Science Center, examining how digital trends affect the labour force.

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© Nay-stock.adobe.com

Driver wages

We continued our engagement on drivers' rights, discussing tensions with drivers over wages in Indonesia and Vietnam, Grab's driver feedback mechanisms, and on-the-ground initiatives.

Grab highlighted that it tracks driver wages against local minimum wage thresholds and that more than 99 percent of driver partners meet or exceed the minimum wage. Where driver discontent arises, Grab seeks to boost productivity by grouping multiple orders and providing heat maps that highlight high-demand areas.

Impact of emerging technologies on gig workers

We also explored the potential implications of the rise in autonomous vehicles (AVs) for gig workers. Grab began AV testing in Singapore in October 2025, in collaboration with WeRide. While wide adoption remains years away – there are fewer AVs globally than London buses – Grab is investigating retraining options and exploring hybrid human/AV models of working. Regulatory dialogue is ongoing, but uncertainty persists.

Outcome and next steps

Regulatory trends support improved worker rights, though we anticipate uneven progress across different markets. We will continue supporting Grab's efforts to improve partner economics, retention and regulatory readiness, particularly in lower-income economies with fewer welfare provisions. Finally, we recognise that the company has taken initial steps in considering the impact of AVs on gig workers and will continue to monitor the company's response as technologies evolve.

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Other engagement highlights

This section highlights engagements across other asset classes and examples of collaborative engagements.

Pertamina (Indonesia)

As noted on page 08 of this report, when investing in government debt, we see benefits in collaboratively engaging to achieve desired stewardship outcomes. As a long-term investor and holder of Indonesian government bonds, we are focused on factors that can strengthen Indonesia's fiscal resilience, improve energy security, and ultimately contribute to long-term growth.

Reducing methane leakage and routine flaring in the Indonesian oil and gas sector could yield several benefits. It could help conserve valuable gas supplies, support domestic energy demand and protect revenues linked to the efficient monetisation of natural resources. All of these matters to the sovereign's fundamentals. Demonstrating low methane emissions can help protect and grow liquefied natural gas (LNG) export revenues, given buyers' evolving procurement expectations. Finally, reducing oil and gas-based methane emissions would reinforce Indonesia's international climate commitments, including its commitment to the Global Methane Pledge.

Through our membership of the Emerging Markets Investor Alliance (EMIA) Indonesia working group, we participated in a collaborative engagement with the Indonesian government and state-owned oil and gas company, Pertamina. In 2025, we co-signed a letter to Indonesia's Minister of Finance on methane and flaring reductions in the oil and gas sector, setting out the case for stronger methane management and recognising progress in reducing national flaring volumes. Separately, we welcomed Pertamina's participation in leading methane initiatives and see this as a foundation for further improvement.

Assura plc

Assura is no longer operating as a specialist Real Estate Investment Trust (REIT). Previously, it owned a portfolio of healthcare facilities in the UK and Ireland. In February 2025, the company announced that it had received several approaches from private equity to acquire the business and delist it from the stock exchange. This opened the door to a subsequent bidding war between the private equity parties, led by KKR and Assura’s publicly listed peer, Primary Health Properties (PHP). The ensuing auction process was both lengthy and competitive, requiring intensive engagement with all parties and their representatives. Our ambition throughout was to ensure our views were clearly communicated to Assura’s management and board, and to deploy our influence in support of an outcome we believed would maximise long-term value for Assura’s investors.

During the engagement process, we met with Assura's management twice and PHP's management three times, and maintained constant communication with the brokers of all three parties. We also wrote twice to the chair of Assura's board. In addition, we issued two press statements – first, stating that the initial private equity approach undervalued the business and highlighting potential sources of value the broader market may have missed; and second, indicating our preference for the proposed combination with Primary Health Properties. Alongside these direct engagements, we also participated in the Investor Forum's collective engagement exercise, which produced valuable insight into the Assura board's decision-making process.

We were pleased when Assura's board, following extensive shareholder discussions with ourselves and others, abandoned its recommendation to accept the private equity-backed offer in favour of PHP's cash-and-share alternative. Not only was this offer worth modestly more than KKR's offer at the time, but it allows us to remain invested for the long term in a larger, more liquid and cost-efficient business that we think could generate compelling forward-looking returns for the fund. Our satisfaction with the equity outcome also gave us confidence to take a position in the credit.

AstraZeneca plc

In September 2025, we participated in a collaborative engagement with AstraZeneca via the Investor Forum. This followed media reports that the company's CEO had suggested potentially moving the company's listing from London to New York. Given the potentially significant implications for the UK market, we considered it appropriate to engage. As a relatively small shareholder in AstraZeneca, we judged a collaborative approach was the most effective engagement mechanism.

The engagement sought to clarify the comments, discuss specific issues that would contribute to a decision to move the listing venue, and make the case for the UK market. The Investor Forum drafted a letter, which we reviewed and provided feedback on, and then sent it to the chair of the board. Afterwards, the Investor Forum had a call with the company's IR, during which it was confirmed that shareholders would be consulted on any proposed change of listing venue.

Shortly afterwards, AstraZeneca announced its intention to upgrade its current US equity listing of American Depositary Receipts (ADRs) to a direct listing in New York. We encouraged the Investor Forum to re-engage with the company, and it held a call with the chair of the board. As AstraZeneca will continue to be listed, headquartered and tax resident in the UK following the change, we were comfortable supporting the proposal at the company's general meeting on the topic. The collaborative engagement provided an effective means of communicating shareholders' concerns and views to the company.

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Our engagement with private companies

Our support of the private companies that we invest in spans capitalisation, governance and access to networks.

Capitalisation

As a trusted long-term shareholder, we support companies in structuring their share capital by leading and shaping equity financing rounds with stage-appropriate economic and voting rights. We assist with debt financing by reviewing terms and facilitating lender relationships. We support companies in preparing for an initial public offering (IPO), providing a differentiated long-term opinion on the many decisions companies must make concerning their capitalisation and governance. This support may continue once they are publicly listed through investing primary capital in IPOs and follow-on offerings.

Governance

One of the significant challenges a private company faces is building an independent-led board suitable for public markets with operationally and strategically experienced directors who can serve as mentors and advisers to the founders and management teams. We help companies in this transition by drawing on the experience and expertise of our governance specialists and by creating connections and facilitating relationships between management teams and board members of private and public companies. Additionally, we support companies on matters important to the investment case as they prepare for an IPO. This can include helping them navigate the changing disclosure requirements, consider share and voting structures, remuneration policies and prepare their IR. Over recent years, we have prepared and distributed papers to help leadership teams cover a variety of such topics, which have been well received by many of our holdings.

Networking

For a growing private company seeking introductions to potential board members, investors, customers or simply people who have faced and overcome similar challenges, access to our network can be an extremely valuable part of its international expansion. We have organised and hosted events focused on the demands of being a public company. For example, in spring 2025, we hosted a three-day forum in Scotland titled ‘The Growth CFO’ for around 30 CFOs from both private and public companies. We also introduce private portfolio companies to our public equities teams as potential future shareholders on the public markets. This connection can be valuable to the company over the long term.

Promoting well-functioning markets

Baillie Gifford makes active capital allocation decisions across a range of investments that we believe will prosper over the long run. Market-wide and systemic risks are those that cannot be mitigated by diversifying investments and can therefore have a significant impact on long-term investment returns. Our stewardship approach seeks to take these risks into account in order to make well-informed decisions and deliver on our clients' expectations.

Stewardship of our clients' assets

We believe that the asset management industry's role is to actively and responsibly allocate capital towards assets that add economic value over the long run. This is often forgotten amid the increasing complexity of financial markets.

Our responsible allocation of capital to create long-term value for our clients is supported through a range of activities. These include, but are not limited to, bottom-up investment research, portfolio construction, risk management and engagement with issuers, standard-setting initiatives, clients and other key stakeholders such as our academic partners. However, as a bottom-up, long-term asset manager, our focus tends to be on individual investment cases and issues related to the assets we invest in.

Management oversight and risk governance

Baillie Gifford operates a group-wide risk management framework. This includes a Risk Appetite Framework and Group Risk Policy, supported by several committees that oversee effective risk management and the operation of internal controls. The framework focuses risk management activity on the strategic aims of the business and provides a high degree of confidence that unexpected risk events will not interfere with the strategy. It also provides a means of expressing the firm's attitude to risk and forms a framework for risk decision-making. This includes market-wide and systemic risks to the business. The Management Committee of Baillie Gifford is responsible for overseeing the firm's overall strategy and risk profile and for approving the Risk Appetite Framework. The key governance committees in respect to risk management are set out in the diagram below:

The Management Committee of Baillie Gifford is responsible for overseeing the firm's overall strategy and risk profile and for approving the Risk Appetite Framework. The key governance committees in respect to risk management are set out in the diagram below:

We identify broader market-wide and systemic risks and themes by combining bottom-up company research and portfolio management. Oversight is provided by several groups, including our Investment Risk, Analytics and Research Department, and the firm's Investment Risk Committee. These groups help ensure that portfolio investment risk levels and concentrations are consistent with client expectations. Baillie Gifford's Business Risk and Compliance functions, assisted by other functions such as Legal, Finance and Human Resources, support these groups and committees. This 'second line of defence' provides policy direction and oversees and monitors the risk framework to determine whether all key risks are being identified, assessed and controlled by management commensurate with Baillie Gifford's applicable risk appetite and regulatory needs.

Assessment of market-wide and systemic risks

Our Investment Risk, Analytics and Research Department conducts regular portfolio-level investment risk reviews, focusing on topics such as equity duration, valuation and growth rates, behavioural risk and portfolio construction, and geopolitical risk. More information on how we consider these factors can be found in our 2024 report. We also considered artificial Intelligence (AI) as an investment theme and concentration of active risk, engaging with investment strategies to review the valuation, growth and quality aspects of companies with AI thematic investment exposure – both directly (such as in semiconductors manufacturers) and indirectly (in sectors which may be beneficiaries of, or seeing disruption or changing economics from, the integration of AI).

In 2025, we completed market-level risk reviews focusing on tariff policy and its impacts on global markets. This involved analysing company quality, resilience and sources of revenue, and regularly incorporating this analysis into ongoing engagement with and reporting to several strategies. This work remains timely as geopolitical volatility increases. Additionally, we deepened our efforts to embed physical climate risk into our oversight of investment risk. This is a complex and evolving topic, with the state of the art still developing. We will continue refining our approach and deepening our understanding throughout the coming year.

We also considered artificial Intelligence (AI) as an investment theme and concentration of active risk, engaging with investment strategies to review the valuation, growth and quality aspects of companies with AI thematic investment exposure – both directly (such as in semiconductors manufacturers) and indirectly (in sectors which may be beneficiaries of, or seeing disruption or changing economics from, the integration of AI).

Additionally, we deepened our efforts to embed physical climate risk into our oversight of investment risk. This is a complex and evolving topic, with the state of the art still developing. We will continue refining our approach and deepening our understanding throughout the coming year.

Climate change and global efforts to mitigate and adapt to its impacts continue to present risks and opportunities relevant to our task of delivering long-term value for clients. Such risks and opportunities can manifest at individual holdings or at the market and system levels. One example of how we assess these risks and opportunities is through our climate scenarios, which are detailed in our Climate Scenarios Project report. These describe how the climate and energy transitions may unfold in the coming years. In 2025, our Climate Team worked with several of our largest investment teams to help them consider the implications of these scenarios for their investment portfolios.

We also built on our 2024 work by introducing an additional scenario that explores the consequences of an energy ‘addition’ rather than the energy ‘transition’ narrative. Some of this work flows into our product-level TCFD-aligned (Task Force on Climate-related Financial Disclosures) climate reports, which are a regulatory requirement for our UK-managed investment funds. These reports can be found on the relevant fund literature pages of our website.

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Client engagement

In 2025, we hosted more than 10 separate climate scenario workshops with clients representing more than £2.5 billion in AUM. These workshops have helped asset owners think about climate across asset classes and have challenged preconceived assumptions and biases. They have also led participants to focus more on the increasingly important topic of physical risk. More information can be found in our Statement of climate-related intent and ambition and our TCFD-aligned Climate Report, available on our website.

Issuer engagement

The engagement case studies detailed in the Our year in stewardship section of this report provide some examples of how we have sought to influence issuers to better manage and respond to market-wide and systemic risks.

Contribution to relevant market-wide policy and standard-setting initiatives

We recognise the importance of a well-functioning investment ecosystem, seek to engage constructively with policymakers, and participate in a range of industry associations, membership organisations and research and innovation networks. These organisations contribute to or are responsible for the regulatory environment, and for establishing and encouraging industry best practice. Our membership of such groups and industry bodies is set out below. Our memberships extend beyond this list, however, for this report, we have included those most closely linked to our stewardship-related activities.

The following examples provide more detail about how we have contributed to these groups and broader industry organisations to advocate for well-functioning financial markets and improvements in corporate governance and sustainability regulation.

Memberships of such groups and industry bodies, and our ongoing input into relevant consultation responses, enable us to keep abreast of developing market-wide and systemic risks, ensuring that our policies and procedures remain relevant. We recognise, however, that these risks can sometimes change rapidly and the impact this can have on businesses.

Investor & Issuer Forum (I&IF)

In September 2024, the Investor Forum launched the I&IF, with the ambition of bringing together market participants to promote cooperation and enhance the effectiveness of the UK's capital markets, with a focus on sustainable value creation. Our involvement with the I&IF has been through the Steering Committee and Working Group, with a Baillie Gifford partner appointed to the Steering Committee and a senior analyst appointed to the Working Group, alongside representatives from across the investment chain. The Committee and Working Group met regularly throughout the year to guide the I&IF's strategy and provide input and feedback on its activities. At the end of 2025, the I&IF launched the Compass, a practical guide to support effective engagement across the investment chain.

During the year, we also contributed to I&IF-led research on pass-through voting, developed with academics from The London School of Economics and Political Science.

Organisation for Economic Co-operation and Development (OECD)

The OECD is an intergovernmental organisation that brings together policymakers and a range of stakeholders to establish evidence-based international standards and find solutions to social, economic and environmental challenges. Through our membership of the Confederation of British Industry (CBI), we have access to the Business Advisory Body to the OECD ('Business at OECD'). This provides a unique opportunity to contribute to intergovernmental discussions and gain early insights into emerging areas of international standard-setting, policy and regulation.

In 2025, we participated through the Business at OECD Corporate Governance Committee and, separately, the Innovation and Technology Committee. In November, we participated in the OECD-Asia Roundtable of Corporate Governance and BIAC Southeast Asia Expert Group Meeting. As a panellist on a roundtable discussion focusing on ‘Board at the Heart of Sustainability Disclosure’, we discussed how regulatory frameworks, investor expectations and global standards are shaping board responsibilities for sustainability oversight and reporting. This allowed us to engage directly with regulators in the region, as well as stock exchanges, shareholder services, public policy bodies and auditors.

Separately, one of our investment professionals is the vice chair of the Business at OECD Innovation and Technology Committee. During the year, we had the opportunity to regularly attend closed-door meetings of the OECD Committee on Science and Technology Policy, where we gained insights and shared perspectives on emerging areas of its policy advice. For instance, we have discussed plans for a forthcoming OECD recommendation to governments on the responsible development of quantum technologies. Alongside OECD policymakers and other key stakeholders, we have also discussed some of the conditions required for long-term investment in innovation.

The Thinking Ahead Institute (TAI)

Baillie Gifford is a member of the TAI, which focuses on research and innovation on best practices for asset owners and asset managers. It covers everything from culture to individual asset classes as components of making the investment system work better for both investors and society. During 2025, we participated in several roundtable discussions on Systems Thinking, and we have been closely following and participating in conversations about the ‘Total Portfolio Approach’ that some large institutions are now adopting in place of traditional Strategic Asset Allocation.

Supporting well-functioning markets for private companies

We participated in two working groups during 2024 and 2025, centred around the creation of the London Stock Exchange Group (LSEG) Private Securities Exchange. One group focused on the legal aspects and the other on the technical details of the exchange itself. The Private Securities Exchange is a new venue that offers private companies access to periodic secondary-market trading, while also managing exchange participants and imposing much lower disclosure rules. We see this as a welcome new step in the ability of exciting private companies to grow, something that could, in time, be beneficial for our clients and for UK growth more generally.

Spotlight on

Collaboration with Panmure House on antimicrobial resistance and effectiveness

Antimicrobial resistance (AMR) represents a material and growing systemic risk to healthcare systems, food systems and long-term economic productivity. For example, the erosion of antimicrobial effectiveness (AME) directly undermines the value of medical innovations and healthcare investments, as many modern cancer therapies depend on effective antibiotics to manage treatment-related infections. As resistance increases, a growing share of patients are unable to complete or even begin cancer treatment, leading to higher mortality, treatment suspensions and a structural reduction in the addressable market for oncology products. This, in turn, creates operational and financial risks for companies and, if unaddressed, threatens long-term value creation.

In 2025, we collaborated with Panmure House to support the ‘Panmure House Dialogues on Market Solutions for Antimicrobial Effectiveness’, convening investors, policymakers, academics and industry participants to explore how market-based solutions and investor stewardship can help conserve AME. The dialogue reframed AME as essential economic infrastructure, highlighting that its value remains under-recognised in financial and corporate decision-making.

Key outcomes focused on improving market functioning by identifying stakeholders exposed to AMR-related risks, encouraging the quantification of financial materiality, and using investor engagement to support system-level change. Participants emphasised that effective stewardship could help align incentives, internalise externalities and strengthen long-term economic resilience. Alongside this work, we participated in the World Antimicrobial Resistance Awareness Week 2025, presenting at a joint webinar hosted by the Access to Medicine Foundation and the World Health Organisation, which highlighted the role investors can play in curbing AMR. We also continued our involvement with the AMR Investor Action platform, a coalition led by the Access to Medicine Foundation, the FAIRR Initiative and the UK Government's Department of Health and Social Care, aimed at galvanising coordinated investor action on global AMR. This activity informs our approach to identifying and responding to market-wide and systemic risks and supports our ongoing engagement with companies where AMR and AME are financially material.

Alongside this work, we participated in the World Antimicrobial Resistance Awareness Week 2025, presenting at a joint webinar hosted by the Access to Medicine Foundation and the World Health Organisation, which highlighted the role investors can play in curbing AMR. We also continued our involvement with the AMR Investor Action platform, a coalition led by the Access to Medicine Foundation, the FAIRR Initiative and the UK Government's Department of Health and Social Care, aimed at galvanising coordinated investor action on global AMR. This activity informs our approach to identifying and responding to market-wide and systemic risks and supports our ongoing engagement with companies where AMR and AME are financially material.

Spotlight on

UK Stewardship Code 2026 consultation

In 2024 and 2025, we participated in the review of the UK Stewardship Code coordinated by the Financial Reporting Council. We also participated in several roundtables and contributed to broader industry stakeholder responses through the IA and the ICGN. We support the Code's continued focus on long-term value creation for clients and beneficiaries, which we believe is the core mission of stewardship.

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Other developments

Updated Conflicts of Interest Disclosures

Our firmwide and stewardship Conflicts of Interest Disclosures are available on our website. As explained in our Stewardship Conflicts of Interest Disclosure, our Proxy Voting Team has processes in place to identify, prevent and manage those proxy voting conflicts of interest of which we are aware. During 2025, we identified the following scenario as a potential conflict and managed this accordingly.

Case study: ESG analyst on the nomination committee of a holding

On behalf of our clients, Baillie Gifford is a shareholder in Kinnevik, a Swedish-listed venture capital firm. In Sweden, the Nomination Committee is commonly comprised of representatives from a company's largest shareholders and should promote the common interests of all shareholders. Having first invested in Kinnevik more than a decade ago, we have long since had a position on the Nomination Committee. In 2025, a Baillie Gifford partner stepped away from the Committee and was replaced by an ESG analyst in our International Growth investment strategy. As the position is not a board position, and the right to be on the Committee stems from shareholding rank on the share register, we do not deem this a conflict of interest. However, given our shareholding and the position we hold, we recognise the increased risk of a conflict arising. To manage this, we have procedures to ensure we do not discuss resolutions related to his Nomination Committee work with him.

Using and Monitoring Service Providers

Part of ensuring we are good stewards of our clients' capital involves monitoring service providers. We use a range of service providers to support our research and stewardship activities. Our providers are listed in Appendix B.

The Business Risk Department owns the firm's Vendor Management Framework and supports the business in overseeing external service providers and suppliers. Each of our providers has a named relationship manager internally responsible for ensuring the provider offers the level of service we require and for carrying out ongoing due diligence, including addressing ad-hoc issues that may arise. MSCI is our primary source of raw ESG data for internal research, mandate compliance and reporting purposes. As our primary provider, we schedule quarterly service calls with MSCI to provide a forum to discuss any queries that arise. We have found the regular cadence of meetings helpful in improving our understanding of supplier developments and quickly resolving any queries that have arisen with the data. We have also enhanced our ESG data quality checking processes, enabling us to investigate discrepancies and raise these with MSCI where necessary. In 2025, we continued to develop our capabilities, enhancing both our analytical tools and our underlying data infrastructure. Working with our investment teams, we automated several manual research processes, improving data timeliness and accuracy while reducing time spent. We also developed new dashboards focused on exposure to controversial issuers by combining third-party data with more thematically focused datasets. As the year progressed, we increasingly leveraged cloud-based data delivery from our data providers. This improved the efficiency of third-party data onboarding and integration, enhancing our ability to support investment research, stewardship activities, and client and regulatory reporting. We are also exploring the use of AI to increase the efficiency of consuming non-standard datasets. We hope that developing this capability will further aid us, particularly in supporting investment research and stewardship activities.

In 2025, we continued to develop our capabilities, enhancing both our analytical tools and our underlying data infrastructure. Working with our investment teams, we automated several manual research processes, improving data timeliness and accuracy while reducing time spent. We also developed new dashboards focused on exposure to controversial issuers by combining third-party data with more thematically focused datasets. As the year progressed, we increasingly leveraged cloud-based data delivery from our data providers. This improved the efficiency of third-party data onboarding and integration, enhancing our ability to support investment research, stewardship activities, and client and regulatory reporting. We are also exploring the use of AI to increase the efficiency of consuming non-standard datasets. We hope that developing this capability will further aid us, particularly in supporting investment research and stewardship activities.

Appendices

Appendix A: UK Stewardship Code mapping

Appendix B: List of service providers

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Appendix C: AUM breakdown

As at 31 December 2025, our assets under management and advice totalled £203bn. Further details split by client type, asset class and investment region are below:

AUM by client type

AUM by asset class

Client type %

● 1 Institutional 77.6

● 2 Retail 22.4

Figures may not sum due to rounding

Figures may not sum due to rounding

AUM by client region

Appendix D: Statement of international stewardship code adoption

• This activities and outcomes report is produced according to the UK Stewardship Code 2026. In addition, we are signatories to a number of other country-specific, regional and global stewardship codes that support our commitment to active ownership in a manner appropriate to the markets we invest in. These are:
• Japan's Stewardship Code
• Investor Stewardship Group (ISG) Principles
• European Fund Asset Management Association (EFAMA) Stewardship Code While this report directly corresponds to the UK Stewardship Code 2026, it also evidences our compliance with the Japan Stewardship Code, ISG, EFAMA and ICGN codes and principles.
• International Corporate Governance Network (ICGN) Principles

While this report directly corresponds to the UK Stewardship Code 2026, it also evidences our compliance with the Japan Stewardship Code, ISG, EFAMA and ICGN codes and principles.

Important information

Baillie Gifford & Co and Baillie Gifford & Co Limited are authorised and regulated by the Financial Conduct Authority (FCA). Baillie Gifford & Co Limited is an Authorised Corporate Director of OEICs.

Baillie Gifford Overseas Limited provides investment management and advisory services to non-UK Professional/Institutional clients only. Baillie Gifford Overseas Limited is wholly owned by Baillie Gifford & Co. Baillie Gifford & Co and Baillie Gifford Overseas Limited are authorised and regulated by the FCA in the UK.

Persons resident or domiciled outside the UK should consult with their professional advisers as to whether they require any governmental or other consents in order to enable them to invest, and with their tax advisers for advice relevant to their own particular circumstances.

Financial Intermediaries

This communication is suitable for use of financial intermediaries. Financial intermediaries are solely responsible for any further distribution and Baillie Gifford takes no responsibility for the reliance on this document by any other person who did not receive this document directly from Baillie Gifford.

Europe

Baillie Gifford Investment Management (Europe) Ltd (BGE) is authorised by the Central Bank of Ireland as an AIFM under the AIFM Regulations and as a UCITS management company under the UCITS Regulation. BGE also has regulatory permissions to perform Individual Portfolio Management activities. BGE provides investment management and advisory services to European (excluding UK) segregated clients. BGE has been appointed as UCITS management company to the following UCITS umbrella company; Baillie Gifford Worldwide Funds plc. BGE is a wholly owned subsidiary of Baillie Gifford Overseas Limited, which is wholly owned by Baillie Gifford & Co. Baillie Gifford Overseas Limited and Baillie Gifford & Co are authorised and regulated in the UK by the Financial Conduct Authority.

Hong Kong

Baillie Gifford Asia (Hong Kong) Limited 柏基亞洲(香港)有限公司 is wholly owned by Baillie Gifford Overseas Limited and holds a Type 1 license from the Securities & Futures Commission of Hong Kong to market and distribute Baillie Gifford's range of collective investment schemes to professional investors in Hong Kong. Baillie Gifford Asia (Hong Kong) Limited 柏基亞洲(香港)有限公司 can be contacted at Suites 2713-2715, Two International Finance Centre, 8 Finance Street, Central, Hong Kong. Telephone +852 3756 5700.

South Korea

Baillie Gifford Overseas Limited is licensed with the Financial Services Commission in South Korea as a cross border Discretionary Investment Manager and Non-discretionary Investment Adviser.

Japan

Mitsubishi UFJ Baillie Gifford Asset Management Limited ('MUBGAM') is a joint venture company between Mitsubishi UFJ Trust & Banking Corporation and Baillie Gifford Overseas Limited. MUBGAM is authorised and regulated by the Financial Conduct Authority.

Australia

Baillie Gifford Overseas Limited (ARBN 118 567 178) is registered as a foreign company under the Corporations Act 2001 (Cth) and holds Foreign Australian Financial Services Licence No 528911. This material is provided to you on the basis that you are a ‘wholesale client’ within the meaning of section 761G of the Corporations Act 2001 (Cth) (“Corporations Act”). Please advise Baillie Gifford Overseas Limited immediately if you are not a wholesale client. In no circumstances may this material be made available to a ‘retail client’ within the meaning of section 761G of the Corporations Act.

This material contains general information only. It does not take into account any person's objectives, financial situation or needs.

South Africa

Baillie Gifford Overseas Limited is registered as a Foreign Financial Services Provider with the Financial Sector Conduct Authority in South Africa.

North America

Baillie Gifford International LLC is wholly owned by Baillie Gifford Overseas Limited; it was formed in Delaware in 2005 and is registered with the SEC. It is the legal entity through which Baillie Gifford Overseas Limited provides client service and marketing functions in North America. Baillie Gifford Overseas Limited is registered with the SEC in the United States of America.

The Manager is not resident in Canada, its head office and principal place of business is in Edinburgh, Scotland. Baillie Gifford Overseas Limited is regulated in Canada as a portfolio manager and exempt market dealer with the Ontario Securities Commission ('OSC'). Its portfolio manager licence is currently passported into Alberta, Quebec, Saskatchewan, Manitoba and Newfoundland & Labrador whereas the exempt market dealer licence is passported across all Canadian provinces and territories.

Israel

Baillie Gifford Overseas is not licensed under Israel's Regulation of Investment Advising, Investment Marketing and Portfolio Management Law, 5755-1995 (the Advice Law) and does not carry insurance pursuant to the Advice Law. This material is only intended for those categories of Israeli residents who are qualified clients listed on the First Addendum to the Advice Law.

Singapore

Baillie Gifford Asia (Singapore) Private Limited is wholly owned by Baillie Gifford Overseas Limited and is regulated by the Monetary Authority of Singapore as a holder of a capital markets services licence to conduct fund management activities for institutional investors and accredited investors in Singapore. Baillie Gifford Overseas Limited, as a foreign related corporation of Baillie Gifford Asia (Singapore) Private Limited, has entered into a cross-border business arrangement with Baillie Gifford Asia (Singapore) Private Limited, and shall be relying upon the exemption under regulation 4 of the Securities and Futures (Exemption for Cross-Border Arrangements) (Foreign Related Corporations) Regulations 2021 which enables both Baillie Gifford Overseas Limited and Baillie Gifford Asia (Singapore) Private Limited to market the full range of segregated mandate services to institutional investors and accredited investors in Singapore.

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