CODE COMPLIANCE STATEMENT This Corporate Governance Report explains how we have Our governance approach has not changed fundamentally applied the Code’s Principles – supported by reporting on since the flotation of the Company in 2006. We do, its Provisions – as set out in the UK Corporate Governance however, review emerging guidance and best practice Code published in July 2018 (the ‘Corporate Governance regularly to ensure we follow not just words and processes Code’), which is available from the website of the Financial but the spirit of what is being asked of today’s UK plc. Reporting Council, www.frc.org.uk. These principles are Our approach is summarised below: applied to the Company’s sole trading subsidiary through • We believe that good governance – in our words ‘doing the Group’s governance, risk management and internal things properly’ – leads to stronger value creation, control structure. the building of greater understanding and trust of our business, lowering risks and creating opportunities for The Board considers that it has complied with the all stakeholders. Corporate Governance Code during the financial year • It is the Board’s responsibility to instil and maintain by applying the Principles and reporting against the a culture of openness, integrity and transparency Provisions in this Annual Report, except for the following: throughout the business, through our policies, Provision 12 – Senior independent Director (SID) communications and by the way in which they, and therefore Dunelm acts. During the period from 28 June 2020 until the appointment • We always intend to comply with the prevailing principles of William Reeve on 10 September 2020 we did not have a of good governance and code of best practice honestly, Senior Independent Director (SID) in place. During this brief simply, transparently, and with clarity and integrity. time, Sir Will Adderley, Deputy Chairman, carried out the SID role as required, and the Chairman’s annual appraisal in • We are pragmatic in our approach and apply corporate 2020 was completed as part of the third-party Board review governance guidelines in a way that is beneficial to our . At FY21 year-end we were compliant. business, and our stakeholders, consistent with our culture and true to our shared values. Provision 38 – Executive pensions • If we decide that the interests of the Company can be Although our 2020 Remuneration Policy requires that the better served by doing things in a different way – without pension entitlement of newly appointed Executive Directors compromising our purpose, culture or shared values – we should be aligned to the workforce average, the pension will explain our reasons why in a thoughtful, compelling entitlement of the incumbent executives, Nick Wilkinson way, including how we have mitigated any impacts of not and Laura Carr, exceeded this during the year. Prior to following the Code. 1 July 2020, their entitlement was 10% of base salary; on • Our Board members believe it is more important to focus 1 July 2020 they accepted a reduction to 8%. They have on what is right for Dunelm than be in the spotlight; we now agreed to reduce their pension entitlement from are prepared to live with our decisions for the long term, 1 August 2021 to the current workforce average, which is and we care about and listen to our stakeholders. 3%. This is two years ahead of the Remuneration Committee commitment to do so by 1 July 2023. Further details are THIS YEAR’S GOVERNANCE REPORT in the Remuneration Report on page 169. Our governance reporting follows the order set out in A DOWN TO EARTH APPROACH TO GOVERNANCEthe Corporate Governance Code: We have always believed that good governance helps 1. Board leadership and company purpose companies make better decisions, for the benefit of all 2. Division of responsibilities stakeholders, including the communities in which they 3. Composition, succession and evaluation operate, and for the economy, environment and society as a whole. This is reflected in our new purpose and shared 4. Audit, risk and internal control values which are referred to throughout this report. We fully 5. Remuneration support the Corporate Governance Code, which sets out good practice that boards should adopt to be effective, accountable, transparent and focused on sustainable PRESENTATIONS AND POLICIES RELATING TO success over the longer term; and which encourages GOVERNANCE AND SUSTAINABILITY ARE ON OUR boards to focus on their purpose and culture, and to CORPORATE WEBSITE CORPORATE.DUNELM.COM respond demonstrably to society’s demand that they consider the needs and expectations of their stakeholders. DUNELM GROUP PLC ANNUAL REPORT & ACCOUNTS 2021 95 GOVERNANCESTRATEGIC REPORT FINANCIAL STATEMENTSOTHER INFORMATION