BRITISH AMERICAN TOBACCO PLC - Board Update Chair Extension and Senior Independent Director Appointment

Evidence from the filing

• The extension of Chair Luc Jobin's tenure ensures leadership continuity and removes uncertainty during the critical phase of the Group's transformation agenda.

  “An extension period of up to two years removes uncertainty during this important phase of the Group's transformation, while providing the Nominations Committee with sufficient flexibility to appoint the right candidate for BAT.”

• The Board's decision to extend the Chair's term is explicitly stated as being in the "best interests of BAT at this time" to maintain effective leadership through a complex transformation, rather than rushing a crucial appointment.

  “the Board concluded that extending Luc's tenure is in the best interests of BAT at this time.”

• A robust and comprehensive Chair succession process was conducted, involving external advisers and the evaluation of multiple credible candidates, demonstrating strong governance practices even when deviating from tenure recommendations.

  “A comprehensive Chair succession process led by Holly Keller Koeppel, the Senior Independent Director, together with the Nominations Committee was supported by external advisers.”

• The appointment of Karen Guerra as the new Senior Independent Director, who was "closely involved in the Chair succession process to date," provides continuity and experienced oversight for the ongoing leadership search and ensures an orderly transition.

  “Karen has been closely involved in the Chair succession process to date and is well placed to lead the refreshed search process and support an orderly transition.”

• The extension of the Chair's tenure beyond nine years directly contravenes the UK Corporate Governance Code's recommendation, signaling a potential weakening of corporate governance standards and raising questions about the board's commitment to best practices.

  “Luc's prior service on the Board means that an extension beyond July 2026 would represent a departure from the UK Corporate Governance Code nine-year tenure recommendation.”

• The need for a two-year extension of the Chair's term, despite having conducted a 'thorough succession process', implies a failure to identify a suitable replacement, indicating underlying issues with the leadership pipeline or the ability to attract top-tier talent.

  “Having run a thorough succession process, evaluating a number of credible candidates against the Board's criteria including effective global leadership at scale and the skills we are seeking to lead BAT through its continued transformation, the Board concluded that extending Luc's tenure is in the best interests of BAT at this time.”

• The stated justification for the extension to 'remove uncertainty during this important phase of the Group's transformation' inadvertently highlights the elevated operational and strategic risks the company faces during this period, now compounded by a non-code-compliant leadership structure.

  “An extension period of up to two years removes uncertainty during this important phase of the Group's transformation, while providing the Nominations Committee with sufficient flexibility to appoint the right candidate for BAT.”

• The departure of the Senior Independent Director who led the initial succession process, coupled with the appointment of a new SID to 'lead the refreshed search process', creates a continuity risk and potential for further delays and inefficiencies in the critical Chair selection process.

  “Having served on the Board since July 2017, Holly Keller Koeppel will step down from the Board at the conclusion of the 2026 AGM and Karen Guerra will be appointed to the role of Senior Independent Director, subject to re-election. Karen has been closely involved in the Chair succession process to date and is well placed to lead the refreshed search process and support an orderly transition.”

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