DELIVERING

FOR A CLEANER,

HEALTHIER

WORLD

Annual Report

and Accounts 2023

01 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Contents

About this report

This report has been

producedtooptimise the

readingexperienceonline.

Our Strategy

Page 08

Financial Performance

Page 41

Sustainability Performance Review

Page 47

STRATEGIC REPORT

02 At a Glance

03 Chair’s Statement

05 Chief Executive Officer’s Statement

07 Market Context

08 Our Strategy

12 Our Business Model

13 Key Performance Indicators

14 Sustainability Performance Dashboard

15 Brand Highlights

19 Spotlight On: People and Culture

22 Spotlight On: Scientific Innovation

25 Spotlight On: Our Supply Chain

28 Market Opportunities: Hygiene

31 Market Opportunities: Health

34 Market Opportunities: Nutrition

37 Our Stakeholders

41 Financial Performance

47 Sustainability Performance Review,

including Non-Financial and Sustainability

Information Statement

55 Risk Management

61 Our Viability Statement

GOVERNANCE

62 Corporate Governance Report

65 Board Leadership and Company Purpose,

including Section 172 Statement

80 Division of Responsibilities

82 Composition, Succession and Evaluation

83 Nomination Committee Report

88 Audit Committee Report

96 Corporate Responsibility,

Sustainability,Ethics and

ComplianceCommittee Report

100 Directors’ Remuneration Report

FINANCIAL STATEMENTS

133 Report of the Directors

137 Statement of Directors’ Responsibilities

138 Independent Auditor’s Report

156 Group Financial Statements

202 Parent Company FinancialStatements,

including Subsidiary Undertakings

OTHER INFORMATION

218 Climate-Related Financial Disclosures

223 Alternative Performance Measures

228 Shareholder Information

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02 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

At a Glance

DELIVERING FOR A CLEANER,

HEALTHIER WORLD

At Reckitt, we protect, heal and

nurture. We do this through our

attractive brand portfolio, which

includes some of the best-known

and most trusted brands in hygiene,

health and nutrition.

Delivering for a cleaner, healthier world

requires strong brands with a global footprint.

Many of our brands have number one or two

market share positions globally or in their

markets. From Dettol, Lysol, Durex, Finish,

Harpic and Vanish to Enfamil, Mucinex, Nurofen,

Strepsils, Nutramigen and Air Wick, consumers

love and rely on our brands to care for their

families, as they have done for over 200 years.

Around 30 million Reckitt products are sold

each day throughout the world, giving us

valuable insight into evolving consumer

behaviours and category trends. We use

this deep understanding to identify unmet

needs and develop solutions to help people

improve their health and hygiene.

Our long-term growth opportunities are rooted

in global megatrends that challenge everyday

health and wellbeing worldwide. We combine

our leading consumer insight and scientific

capabilities to create innovative products that can

address these everyday issues. This helps us reach

into new spaces and geographies, expanding

our presence in high-growth categories.

Our culture is innovative, caring and

entrepreneurial. Our valuesensure we

workcollectively forourconsumers,

employeesandallourstakeholders.

By continuously striving to minimise the

environmental impact of our business

and work towards a fairer society, we

are addressing evolving consumer needs

whilst supporting the planet and the

communities in which we operate.

This is how we create shared success.

Like-for-like

net revenue growth

+3.5%

2022: 7.6%

Adjusted operating

margin

23.1%

2022: 23.8%

Adjusted total

EPS

diluted

323.4p

2022: 341.7p

Full-year

dividend

192.5p

2022: 183.3p

Net revenue

from more

sustainable

products

29.6%

2022: 24.4%

IFRS net

revenue growth

+1.1%

2022: 9.2%

IFRS operating

margin

17.3%

2022: 22.5%

IFRS total

EPS diluted

228.7p

2022: 324.7p

Free cash flow

generation

£2.3bn

2022: £2.0bn

Absolute reduction

ingreenhousegas

emissions from

operations since 2015

67%

2022: 66%

1. Adjusted and other non-GAAP measures, definitions and

terms are defined on page 223

03 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Chair’s Statement

2023 was another eventful year. There were

challenges, but also encouraging progress

and positive change for our Company.

Like many companies, we experienced continued

macroeconomic headwinds, further disruptions to

our supply chain and the effects of the continuing

war in Ukraine and conflict in the Middle East.

Wealso saw changes in Reckitt’s leadership team,

with appointees to the roles of Chief Executive

Officer (CEO) and Chief Financial Officer (CFO)

Designate, as well as a new Chair to succeed

me following our 2024 Annual General Meeting

(AGM) and the completion of my full Board term.

I’m proud to say that throughout 2023, our

Company has proven its resilience and many

capabilities. We grew our revenue and our gross

margin, which ranks amongst the industry’s

highest. In line with our capital allocation policy

to deliver sustainable dividend growth, we have

proposed a 5% increase in our annual dividend

for the second year in a row. In total, we returned

£1.5 billion to shareholders through dividend

growth and our share buyback programme.

Amongst our innovations, we launched Lysol

Air Sanitiser, creating an entirely new sub-

category in Air Care. Whilst internally, our

annual GLINT employee survey revealed high

levels of endorsement from our people for

the clarity and direction we have brought to

our Purpose and the values that unite us.

Continuity and change

Whilst our commitment to our market-leading

brands has remained constant, today’s Reckitt

isvery different to the company I assumed the

Chair of six years ago.

A YEAR OF

PROGRESS AND

POSITIVE CHANGE

Reckitt is a special enterprise,

withpowerful brands, enormously

talented and passionate colleagues

and a compelling vision for the future.“

Chris Sinclair

Chair

04 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Leadership and talent

Our evolution as a Company has been

accompanied by a transition in our leadership.

Nicandro Durante, who had been our

Senior Independent Director, led our senior

management team as CEO for most of 2023.

I would like to sincerely thank Nicandro

for his leadership over this period.

Nicandro helped us oversee the selection of a

permanent CEO and a new CFO. The appointments

of Kris Licht and Shannon Eisenhardt to these

respective roles bring two highly talented and

accomplished global leaders to the forefront

of our Company, and I am confident they will

shape an exciting next chapter for Reckitt.

Kris brings considerable experience from within

Reckitt to the role of CEO, which he assumed on

1 October. Shannon joined the business from Nike

in October and formally assumed the role of CFO in

March 2024. Jeff’s contributions and commitment

to our company have been considerable. He

departs with my sincere thanks and very best

wishes for his well-deserved retirement.

There are other changes to our Board as well. We

extend a warm welcome to Marybeth Hays, who

joined the Board as a Non-Executive Director on

1 February. A former Walmart senior executive,

Marybeth brings more than 25 years of experience

in retail, healthcare and consumer goods.

We will also welcome Fiona Dawson to the Board

as a Non-Executive Director and Chair Designate

to the Remuneration Committee effective

1 June 2024. We thank Alan Stewart, who plans

to retire from the Board following the AGM.

In addition, I am also preparing to step down

from my position, having spent nine years on the

Reckitt Board. During this time we have built a

highly talented and diverse Board, which will enjoy

strong leadership under Sir Jeremy Darroch when

he takes over as Chair in May 2024. Jeremy is an

outstanding leader with considerable expertise

and a proven track record of performance. I know

Reckitt will succeed under his stewardship.

Legacy and reflections

Looking back on my tenure over these past nine

years, we have learned, and continue to learn,

agreat deal, not least from the experiences that

influence us, and which make Reckitt a more

effective and successful company today.

These include solidifying the importance of always

doing the right thing and standing by our values,

which are now codified through Leadership

Behaviours that require each of us to Own,

Create, Deliver and Care in everything we do.

We have demonstrated the value of brand

reinvestment alongside the delivery of

product superiority. This has allowed us to

unleash the potential of our brands to extend,

to premiumise and ultimately, to lead global

categories with long runways for growth.

We have also extended the breadth and reach

of our portfolio, harnessing the ‘Science Inside’

Reckitt to innovate brands that define their

categories. We have embraced technology

to transform our operations and deepen our

relationships with customers and consumers.

We have made many improvements in the

stewardship of the business that strengthen

our governance foundations and reinforce our

commitment to product quality and safety.

Furthermore, we have realised the benefits

ofbringing excellence to the point of sale and

are now rewarded with deeper, more enduring

customer relationships, which we are better

able to serve through a transformed supply

chain that has demonstrated its resilience

and strength when it has mattered most.

Above all, we have recognised that our greatest

assets are our people and the culture that

defines us. Reckitt is a special enterprise,

with powerful brands, enormously talented

and passionate colleagues, and a compelling

vision for the future. I leave full of pride in

our Company’s many achievements and with

enormous optimism about the years ahead.

This period has seen us rethink our culture and our

Purpose. We have invested in our people and the

values we want to define them, creating a culture

that is purposeful, entrepreneurial and caring.

We have transformed our capabilities to innovate

great products and extend categories. We have

deepened our consumer value proposition and set

new standards in customer service excellence.

Still, our strategy has remained unchanged.

The achievements of the past year affirm

that we operate in the right categories with

the right products. The focus now and in the

future is to deliver on the investments we have

made and the greater productivity, better

in-market execution capabilities and higher

shareholder returns we have enabled.

Chair’s Statement continued

Leadership Conference 2023

05 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Chief Executive Officer’s Statement

It is an honour to become CEO of Reckitt and

tolead our Company at such an important time.

Much has happened since I joined Reckitt four

years ago. We have encountered volatility,

opportunities and challenges, both in our

markets and within our business. We have also

undertaken a transformation programme that

has seen us invest in the strength of our brands,

transform our execution capabilities and establish

customer partnerships of unprecedented depth.

Our goal throughout has been to build the best

Reckitt possible. The result is a business that is

not only stronger, but also around a third larger

on a like-for-like (LFL) net revenue basis than it

was in 2019. And we have delivered this growth

with superior, industry-leading gross margins,

demonstrating the strength of our earnings

modeland the enduring attraction of our brands.

Focused on shareholder value creation

Whilst there is more work to be done to realise

ourfull potential, we are continuing to deliver,

asour recent performance shows.

Amidst continued market volatility and inflationary

pressures, we delivered LFL net revenue growth of

3.5% ahead of ingoing expectations and adjusted

operating margin of 23.1%. On an IFRS basis, our

operating margin was 17.3% which included an

£810 million goodwill impairment relating to our

Nutrition business (see page45). We reduced

our leverage and grew free cash flow by 11% to

£2.3 billion, enabling us to return £1.5 billion to

shareholders through an increased dividend and

our newly announced share buyback programme.

The strength of our business positions us well

todeliver adjusted operating profit growth ahead

of net revenue growth in the medium term, and

toraise returns to shareholders further through

growing our dividend and buying back our shares.

AN ENDURING

FRAMEWORK

FOR SUSTAINED

VALUE CREATION

We are a strong business with a purpose

and culture fit for the future, an excellent

brand portfolio and a scaled global

footprint. These position us well to

deliverthe next chapter of our growth.”

Kris Licht

Chief Executive Officer

06 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

and lock in scale opportunities where they exist.

We are also right-sizing ongoing investment in

our capabilities whilst ensuring we preserve the

important operational muscle we have built.

Beyond these, we see significant scope to

improve efficiency through automation and

shared services, as well as in harnessing the

productivity benefits of generative Artificial

Intelligence (AI), where we now have a group

policy in place to encourage our people to

embrace the technology responsibly.

In-market execution is another priority. By

providing our sales teams with the latest

digital technologies to optimise revenue

growth, we are now well equipped to win in

our markets. The focus now is to ensure we

execute with excellence wherever we play.

Lastly, our brand portfolio is strong but we must

always strive to improve. Product superiority,

sustainability and value are benchmarks we use

to measure our success. Although we possess

these across many of our categories, we must

innovate assiduously to ensure we earn their

market leadership and consumer trust each day.

Enhancing returns to shareholders

Execution also means maximising the returns

we offer to our shareholders. Our ambition has

always been to ensure these are industry leading

whenever our financial circumstances allow, in

line with our total shareholder return algorithm.

Thanks to our financial strength, I was very

pleased to announce our new share buyback

programme in October and our goal of buying

back £1 billion of our shares over the following

12 months. We expect this programme to

continue in the coming years, consistent

with our capital allocation principles.

Delivering on our ambitions

We move into 2024 a stronger, better equipped

and more agile business. Our Purpose is clear,

compelling and unchanged, as is our strategy and

the strength it draws from our earnings model.

Our focus is now on delivery and execution

as we reap the benefits of the investments

we have made. We must continue to evolve

what we do, whilst ensuring we don’t

disrupt the achievements we have secured.

Success will support our financial ambitions

and ensure Reckitt is able to deliver an

attractive, compounding total shareholder

return and drive enduring value creation.

I would like to thank our Chair and the Board

for the trust they have placed in me to deliver

on our ambitions. I would also like to thank

Nicandro Durante for his leadership. It has been

an honour to work alongside him this past year.

We are stewards of some of the world’s leading

household brands. Our role is to enhance their

value as they journey to serve the needs of a

new generation of consumers. This truly is an

exciting time for Reckitt and our people, whose

sense of ownership, entrepreneurial spirit and

drive for performance whilst always doing the

right thing at our core, are an enduring source

of competitive advantage as we write this

next chapter of growth for our business.

Group LFL net revenue growth

+3.5%

2022: +7.6%

Group 4-year LFL net revenue CAGR

+7.0%

A strong long-term growth business

The Reckitt I am privileged to lead is a strong,

competitive and resilient business. We have

a clear Purpose and a unique, entrepreneurial

ownership culture that is fit for the future.

Ourbrand portfolio is excellent and serves

asthe foundation for enduring value creation.

Our scaled global footprint spans developed

and emerging markets in categories that enjoy

long-term runways for growth. More than 70%

of our brands occupy market leading positions

in their categories on a net revenue basis and

earn high levels of consumer trust. Their strong

brand equity enables us to drive growth through

premiumisation and brand extensions alongside

the entirely new product categories we create

through world-class science-backed innovation.

Investments in our supply chain and go-to-

market networks have strengthened our abilities

to forge strong customer partnerships and

grow the distribution of our brands. Guiding

these are advanced digital and machine-

learning capabilities, which now enable us to

connect data of unprecedented scale when

deciding where to play and how to win.

Sharpening our execution

With the investment phase in these capabilities

now substantially behind us, our focus is on

maximising their benefits through sharpening

andimproving our execution.

Our cost base is a key focus. Our industry-

leading margins demonstrate the advantages

our categories enjoy. Yet there remains room for

us to be more efficient. We are extending our

productivity programmes to simplify our processes

Chief Executive Officer’s Statement continued

07 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Context

Our growth opportunity is rooted

infour global megatrends that

challenge everyday health and

wellbeing worldwide. We innovate

todeliver sustainable solutions which

address these challenges through

brands dedicated to the pursuit

ofacleaner, healthier world.

TACKLING

FOUR GLOBAL

CHALLENGES

#1 Health impact of poor access to water,

sanitation and hygiene

As cities become more crowded and populations more mobile, good

hygiene is essential in curbing the spread of infection. In developing

economies, water stress can compromise hygiene. This has a direct

impact on health, both in cities and in rural communities.

Our response: We promote hygiene as the foundation for health.

Ourproducts enable the highest standards of hygiene in the home

andprotect against the spread of germs, viruses and bacteria. Lysol

andDettol, our disinfectant brands, help break the chain of infection

onsurfaces, from hands and other at-risk spaces. Finish, Harpic and

Vanish support cleanliness and hygiene in the home. Our pest brands

likeMortein and SBP protect against unwanted pests and insects.

TheReckitt Global Hygiene Institute and our Fight for Access Fund

extend scientific understanding and grow awareness of hygiene issues.

#3 Importance of intimate wellness

and sexual health to public health

In many parts of the world, limited awareness and understanding of

intimate wellness and sexual health can contribute to the spread of

sexually transmitted infections (STIs). In some traditionally conservative

societies, cultural taboos rather than health considerations guide policy

priorities. Elsewhere, reproductive health and sexual wellbeing have not

been public policy priorities in recent years, whilst lockdown and other

pandemic-related measures restricted youth access to sexual education

and development.

Our response: We safeguard consumers by promoting sexual wellbeing

and helping to limit the spread of STIs. Durex, our world-leading condom

brand, alongside KY, our leading lubricant brand, play a crucial role in

reducing the risk of STI transmission whilst encouraging safe sex practices.

#2 Growing pressures on formal healthcare systems

Across the world, ageing populations and stretched public finances

areputting pressure on healthcare systems. Meanwhile, individuals are

becoming better informed and active in managing their health. Self-care

solutions, such as over-the-counter (OTC) health and wellness products,

give people more control and lessen the need to access formal

healthcare services.

Our response: We are reducing demand for formal healthcare by

empowering consumers with effective and practical self-care solutions.

OTC treatments like Mucinex, Nurofen and Strepsils combined with health

literacy campaigns enable individuals to better care for themselves and

treat a range of everyday ailments at home. We partner with clinicians

and share science-backed information with consumers to prevent and

treat infection alongside solutions to support personalised nutrition,

wellness and access to digital health resources.

#4 Growth in specialised nutritional needs

Infants deserve the best possible start in life. The nutrition they receive

is a key foundation for future health, especially those with allergies

orother specialised nutritional needs. Longer life expectancy means

agrowing demand for nutritional products that support mental and

physical wellness as we age. All adults, especially seniors, can benefit

from high-quality speciality food supplements that support immunity,

digestion, cognitive and mental health.

Our response: Our specialised nutrition products help infants to flourish

and adults to live fuller lives. Our market-leading brands, such as the

Enfarange and Nutramigen, draw on deep science platforms to serve

important early life nutritional needs. Brands like Provital, Move Free,

Airborne and Neuriva provide adults with essential vitamins, minerals and

supplements (VMS). We innovate constantly to deliver novel solutions

that serve the growing range of nutritional needs of infants and adults.

for how our brands contribute to improving global hygiene.

See pages 28-30

for how Durex contributes toglobal sexual health.

See page 32

for how our brands offer self-care solutions.

See pages 31-33

for how our brands provide clinically-proven nutritional options for infants and adults.

See pages 34-36

Do the

right thing.

Always.

Own

Deliver

Care Create

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Strategy

A STRONG

BUSINESS

PURPOSE AND CULTURE FIT FOR THE FUTURE

Our Purpose and culture,

excellentportfolio ofbrands

andscaled footprint underpin

ourstrategy todeliver attractive,

compounding total shareholder

return and drive enduring

valuecreation.

Our Purpose is clear and compelling.

Our brands and products do good in the world and enable us to

Protect, Heal and Nurture in the pursuit of a cleaner and healthier world.

Our 2030 Sustainability Ambitions are an integral part of our strategy

with a focus on three pillars of activity: innovating Purpose-led Brands,

enabling a Healthier Planet and contributing to a Fairer Society.

Our unique culture is purpose-driven, entrepreneurial, fast-paced

and action-oriented. Our people have an ownership mindset, and are

inspired to outperform with passion and energy throughout our business.

PURPOSE AND

CULTURE FIT

FOR THE FUTURE

EXCELLENT BRAND

PORTFOLIO FOR

VALUE CREATION

SCALED GLOBAL

FOOTPRINT

ENHANCED

RETURNS TO

SHAREHOLDERS

for our spotlight on people and culture.

See pages 19-21

We exist to

PROTECT,

HEAL AND NURTURE

in the pursuit of a cleaner

and healthier world

Our Purpose Our Culture

09 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Strategy continued

We operate in long-term growth categories We have an excellent portfolio of market-leading brands

We operate in categories with significant and long-term runways for growth. Category creation,

household penetration and premiumisation can fuel our growth for decades to come. On average,

we expect the medium-term revenue growth of our categories to be in the region of 3% to 4%.

More than 70% of our brands, on a net revenue basis, occupy market-leading positions in their

respective categories, with a high level of consumer trust and affinity.

OTC

11%

LFL NR CAGR vs 2019

Intimate Wellness

1 in 2

consumers did not

use a condom the

first time they had sex

Auto Dishwash

13%

global dishwash

machine penetration

Fabric Additives

1 in 5

people use a stain

removal product

EXCELLENT BRAND PORTFOLIO FOR VALUE CREATION

OTC

#2 US #2 Europe #1 Globally #1 Globally

Intimate Wellness

#1 Globally #1 Globally

Surface & Disinfection

Auto Dishwash

#1 Globally

Germ Protection

#1 Globally #3 US

VMS

Air Care

#3 Globally

Fabric Additives

#1 Globally #1 Globally

Lavatory Care

Personal Care

#1 Globally

Infant & Child | Specialty

#1 Globally #1 Globally

1. Branded player claims based on aggregated data from Nielsen, in each case, for the relevant category and geographic focus,

for period MAT Dec 2023

2. See pages 28-36 for specific category details

Value creation principles

Our portfolio choices are underpinned by

threeclear principles of portfolio value creation

that govern our organic and inorganic capital

allocation priorities.

LONG-TERM RUNWAY

FOR GROWTH

ATTRACTIVE

EARNINGS MODEL

ENDURING COMPETITIVE

ADVANTAGE

for more details.

See pages 28-36

10 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Strategy continued

We have a scaled global footprint across

developed andemerging markets.

We have seen strong, broad-based net revenue

growth across both developed and emerging

markets and enjoy significant scale benefits in major

strategic growth markets, such as the US, China and

India. These markets alone contribute around 40%

of our Group net revenue and around 50% of our

Group net revenue growth over the last four years.

This scale in our manufacturing and go-to-market

networks enables us to partner effectively

with our customers and continuously grow the

distribution of our brands. When coupled with

our excellent brand portfolio and strengthened

innovation pipeline, this creates the opportunity

to rapidly scale and execute consumer-

preferred propositions throughout the world.

SCALED GLOBAL FOOTPRINT

DEVELOPED MARKETS

(c.65% of business

)

EMERGING MARKETS

(c.35% of business

)

+8.3%

Australia

+7.2%

United Kingdom

+5.9%

4-year LFL NR CAGR for top 3 markets

1, 4

China

+13.6%

Mexico

+8.3%

India

+8.2%

4-year LFL NR CAGR for top 3 markets

1, 4

4-year LFL NR CAGR vs 2019

4, 7

+7.5%

4-year LFL NR CAGR vs 2019

4, 7

+6.6%

Larger business than 2019

£2.5bn

Larger business than 2019

£1.1bn

1. Based on FY23 net revenue

2. Based on Advantage Group 2023 survey of retailers. 260bps

increase in markets rated top tier, from 39.5% in 2022 to 42.1%

in 2023. Share of markets excludes US

3. Decline from 29.1% (Nov YTD 2022) to 28.7% (Nov YTD 2023),

reflecting effects of US Nutrition rebasing. Hygiene and Health

increased by 10bps over the same period. On a 2-year basis versus

Nov YTD 2021, we increased total distribution points by 120bps

4. LFL net revenue CAGR FY23 vs FY19

5. On a LFL net revenue basis FY23 vs FY19

6. Excludes the benefit from US Nutrition

7. FY23 LFL equivalent: Developed Markets +4.4% and

EmergingMarkets +1.9%

+260bps

Share of markets where

we are recognised as top

tier by retail partners

2022: +100bps

-40bps

Reckitt Share of Total

Distribution Points

2022: +70bps

11 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainable mid-single-digit net revenue growth

We have an excellent portfolio of market leading brands operating in categories with

along-term runway for growth. We target to deliver sustainable mid-single-digit net

revenuegrowth, ahead of the medium-term growth of our categories.

High gross margin business

Our Group delivers high gross margins which reflects the quality of both the categories

inwhich we operate and the premiumisation of our portfolio.

Brand investments

Investing behind innovation, consumer education and omni-channel marketing is key to

ensuring our brands resonate with both customers and consumers and drive outperformance.

Adjusted operating profit growth ahead of net revenue growth

Operating leverage from topline growth at structurally high gross margins coupled with

anoptimised cost base delivered through our productivity programme fuels sustained

profitgrowth ahead of net revenue growth.

Strong cash flow and healthy balance sheet

High cash flow generation, with leverage at around 2.0x EBITDA. This places Reckitt

inaposition to deliver enhanced returns to shareholders.

Capital Allocation Framework

Our top priority is to invest in organic growth. We will continue to prioritise strong free

cashconversion and we are committed to sustainable progressive dividend growth. We target

a single Acredit rating and will maintain financial ratios appropriate with that rating. We will

use our three principles for long-term portfolio value creation to strengthen and optimise our

portfolio. We will manage an efficient balance sheet and return surplus cash to shareholders.

Our Strategy continued

ENHANCED RETURNS TO SHAREHOLDERS

We have an enduring framework for sustained value creation

MID-SINGLE-DIGIT

NET REVENUE GROWTH

We target sustainable

mid-single-digit top-line growth

overthe medium term.

GROW AOP AHEAD

OF NET REVENUE

We target to grow adjusted operating

profit ahead of net revenue growth

inthe medium term.

SUSTAINABLE

DIVIDEND GROWTH

We have a progressive

dividend growth policy

(5% increase in 2023).

BUYBACKS

New £1 billion initial

share buyback programme

announced October 2023.

Earnings model driven Strong cash flow generation and capital allocation priorities

12 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Business Model

OUR ENABLERS

Our people and culture

We are a diverse workforce of over40,000

people from 125 different nations, and

our Company’s Purpose inspires our

team to make a positive impact.

Our brands

Our global portfolio of brands occupy

market-leading positions in their respective

categories. Our brands have a high level

of consumer trust and affinity, providing

an enduring competitive advantage.

1. Engage two billion people

withpurpose-led partnerships,

programmes and campaigns to

promote awareness for a cleaner,

healthier world (cumulative since 2020)

Our stakeholders

Together with our customers, consumers,

suppliers, communities and other partners,

wehave built strong partnerships with a unified

ambition to extend our positive impact.

Our insight and expertise

We translate our deep multi-dimensional

consumer insight into targeted product science

which is a key source of competitive advantage.

Our infrastructure

We have invested in and strengthened our

supplychain, enhancing the capabilities of

ourmanufacturing sites and R&D laboratories,

aswellas our digital systems.

Our financial strength

Structurally superior gross margins enable an

earnings model which can fuel both growth and

enhanced, sustained total shareholder returns.

OUR VALUE CHAIN THE VALUE WE CREATE

Sourcing

We source product packaging and household product

chemicals, such as pharmaceutical ingredients and

agricultural commodities, from around 4,000 suppliers

in70countries. Around 36,000 suppliers provide services

that support our business.

Manufacturing

Around 90% of our products are manufactured in-house

byour 48production and warehouse facilities. Supporting

our production requirements, we work with 243 third-party

manufacturing sites (co-packers).

Supply/logistics

Our global distribution network consists of 131 distribution/

embellishment centres across 51 countries.

Sales and

marketing

Globally, our major trading channels span millions of retailers

(hypermarkets and supermarkets, club, pharmacies, drug

stores, pure-play, discounters, convenience stores, mom &

pop stores, traditional trade outlets and speciality retail).

Consumer use

We sell around 30 million products every single day.

Onthis scale, even small changes in consumer behaviour

canhave a big impact.

Our People

c.9,500

Learning Library Unique Users

2022: n/a

Read more on page 40

for more details on our engagement

with our key stakeholders.

See pages 37-40

We develop superior solutions grounded in science and

weuse our Sustainable Innovation Calculator to design

products that contribute to our sustainability targets.

Readmore on pages 22-24.

Product design

We aim to design for a circular economy to help reduce

plastic and packaging waste. Read more on page 49.

End of life

disposal

022

020

021

019

023

7.6%

11.8%

3.5%

0.8%

3.5%

022

020

021

019

023

13.2%

10.1%

10.3%

12 .5%

022

020

021

019

023

24.4%

30.4%

24.9%

24.6%

29.6%†

022

020

021

023

-66%

-39%

-66%

-67%†

022

020

021

019

023

+9.2%

+0.7%

-2.6%

-1.9%

+0.9%

022

020

021

019

023

341.7p

327.0p

288.5p

349.0p

323.4p

022

020

021

019

023

83%

131%

61%

87%

97%

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Key Performance Indicators

Reckitt’s key performance

indicators (KPIs) include

measuresfor assessing financial

and non-financial performance.

Variable pay across the Group is aligned

to these KPIs. Central to our remuneration

philosophy are the principles of pay for

performance, as well as strategic alignment.

Combined with our Compass and Leadership

Behaviours, these principles define how

decisions are made, how people act and

how they are assessed and rewarded.

The KPIs shown here directly impact

theremuneration awarded to

ExecutiveDirectors.

Like-for-like net revenue growth

Return on capital employed (ROCE)

Net revenue from more

sustainableproducts

1, 3

Reduction in Greenhouse Gas (GHG)

emissions inouroperations

1. See details on our alternative performance

measures on page 223

2. Years after and including 2021 exclude

IFCNChina (disposed September 2021)

3. Figures prior to 2021 exclude our Nutrition

business unit

† Data was subject to independent limited

assurance by ERM CVS in accordance

withISAE 3000 (Revised) and ISAE 3410.

Please see ERM CVS’ full assurance report

at www.reckitt.com/reporting-hub for

more details

Adjusted operating profit growth

atconstant exchange rates

1, 2

Adjusted diluted earnings per share

Free cash flow conversion

Why we measure it: To ensure our strategy

is delivering organic revenue growth. The

mix and strength of products and brands

enables us to deliver mid-single-digit

growth over time.

Performance narrative: Group net revenue

of £14,607 million grew by 3.5% on a LFL

basisinthe year, reflecting price/mix

improvements of +7.8% and a volume

decline of -4.3%. Our Hygiene brands grew

(+5.1%), our Health brands grew (+5.0%) and

Nutrition declined (-4.0%) as the US lapped

the prior year competitor supply issue.

Why we measure it: To ensure disciplined

capital management.

Performance narrative: ROCE in 2023 was

12.5% (2022: 13.2%), a decrease of 70bps

from 2022, due to a lower Net Operating

Profit After Tax as a result of the higher

adjusted tax rate.

Why we measure it: To drive product

innovation that supports the delivery of

our sustainability ambitions and meets the

growing demand for more sustainable

products. We are targeting 50% of net

revenue from more sustainable products

by 2030, as measured by our Sustainable

Innovation Calculator.

Performance narrative: 2023 improvement

reflects more sustainable innovations

reaching the marketplace, and better use

of the Calculator on new and existing

product development across all GBUs.

Why we measure it: To support our net

zero ambition and reduce emissions from

our own operations. We are targeting

a65% absolute reduction in operational

(Scope 1 and 2) GHG emissions by 2030.

Performance narrative: Through our

ongoing focus on optimising high energy

manufacturing processes, we continued

tosurpass our science-based target

reduction of 65% by 2030.

Why we measure it: To ensure we are

converting revenue growth into profit.

Weanticipate growing operating profit

faster than revenue growth.

Performance narrative: Adjusted operating

profit grew less than net revenue in 2023,

as gross margin expansion was offset by

increased brand equity investments and

inflation led cost base increases.

Why we measure it: To monitor profitability

and to provide a comparable net profit per

share attributable to owners.

Performance narrative: Adjusted diluted

EPS was 323.4 pence (2022: 341.7 pence),

adecrease of 5.4%, as higher adjusted

operating profit at constant exchange

rates was more than offset by adverse

foreign exchange and a higher adjusted

effective tax rate in 2023.

Why we measure it: To maintain the

delivery of strong free cash flow

conversion over time.

Performance narrative: Free cash flow of

£2,258 million increased by £227 million or

11%. Free cash flow conversion improved by

14 percentage points to 97% as the benefit

from working capital was only partially

offset byhigher tax and interest paid.

MEASURING

PERFORMANCE

for details of our definitions and terms in our APMs.

See page 223

for more information in our Remuneration Report.

See page 100

14 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Dashboard

OUR SUSTAINABILITY AMBITIONS PROGRESS OVERVIEW

This dashboard summarises our performance across key metrics and targets. A full performance breakdown can be found in our

Sustainability Report and ESG Data Book, available online at www.reckitt.com/reporting-hub

† ERM CVS provides independent limited assurance over selected sustainability disclosures. The assurance report, along with the principles and methodologies we use in our reporting, can be found online at www.reckitt.com/reporting-hub

1. Environmental reduction targets for carbon, water and waste are from a 2015 baseline

2. Reduction target for plastic is from a 2020 baseline. All packaging data relates to 2022, which is driven by the Ellen MacArthur Foundation reporting timelines. 2023 data will be available in mid-2024

3. Data as of 31 December 2023 for active Reckitt employees (excluding contractors). ‘All management’ includes: Executive Committee Member, Group Leadership Team, Senior Management Team, Middle Manager, Manager. See breakdowns on page 51

INNOVATING

PURPOSE-LED BRANDS

ENABLING A

HEALTHIER PLANET

CONTRIBUTING TO

AFAIRER SOCIETY

Sustainability pillar Topic Ambition Baseline 2023 progress Target

More sustainable

products

50% absolute reduction in product carbon footprint by 2030

13. 5%†

50%

50% reduction in product water footprint by 2040

9.9%†

50%

Plastics and

packaging

50% reduction in amount of virgin plastic packaging by 2030

50%

25% recycled content in our plastic packaging by 2025

25%

100% of packaging recyclable or reusable by 2025

76%

100%

Climate

Net zero across our value chain by 2040

65% absolute reduction in operational (Scope 1 and 2) GHG emissions by 2030

67%†

65%

100% renewable electricity by 2030

94%†

100%

Water

Water positive in water-stressed locations where we operate by 2030

17 sites

30% reduction in water use (per tonne of production) by 2025

7%†

30%

Waste

100% zero waste to landfill from our factories

10 0%†

100%

Inclusion

An inclusive culture where everybody is treated fairly and equitably

Gender balance at all management levels by 2030³

M: 49%

F: 51%

50/50

Social impact

Engage two billion people with purpose-led partnerships, programmes and campaigns

to promote awareness fora cleaner, healthier world (cumulative since 2020)

1.9 billion†

2 billion

Social Impact Investment of £20 million per year

£31 million

£20 million

for our Environmental Performance Review.

See pages 48–50

for our Social Performance Review.

See pages 51–53

Key: Baseline Target

for more on our innovation programme.

See page 24 See page 47

FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORTReckitt Annual Report and Accounts 202315

BRAND HIGHLIGHTS

Finish is the world’s leading auto dishwash brand. 2023 saw the launch

ofFinish Ultimate Plus, with technology that releases the right ingredient

to act at the right time in the wash cycle, further enabling people to

‘Skipthe Rinse’. Whilst Finish’s footprint is concentrated in markets such

asEurope and the US, its runway for growth is through global penetration

opportunities and premiumisation given dishwasher ownership in many

parts of the world remains low and our premium thermoformed tablets

are gaining share.

With a range of fabric stain

removers, whiteners and carpet

cleaners, Vanish is the number

onefabric treatment brand in the

world. In 2023, Vanish launched

amajor formula change, which

promises stain removal and colour

protection even at 20°C, enabling

consumers to save energy and

helping clothes look new for longer.

finish.co.uk

vanish.co.uk

airwick.co.uk

As one of the first brands dedicated to

air care, Air Wick has uplifted homes for

80 years. Air Wick is the number three

branded air care player globally. The

brand continues to innovate, such as

with the 2023 launch of 24/7 Active

Fresh, our first aerosol-free and best

ever auto-spray.

FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORTReckitt Annual Report and Accounts 202316

With a range of toilet and

bathroom cleaners and

fresheners, Harpic is the

number one lavatory care

player globally. In 2023 we

launched the Harpic Hygienic

&Fresh Sticker, our first

self-sticking toilet block

with99% less plastic,

whichconsumers love

foritssimplicity.

harpic.co.uk

The number one branded multipurpose

cleaning and disinfectant player in the world,

Lysol has been breaking the chain of infection

and protecting families from illness-causing

germs for more than a century. In the US,

itskey market, Lysol represents the gold

standard in germ protection and continues to

leverage its equity to create new categories,

such as laundry sanitiser and air sanitiser,

which launched in 2023.

lysol.com

Dettol is present in over 130 countries across 10 categories from

surfacedisinfection and laundry sanitiser to hand wash and shower gel.

Itis the world’s number one brand in antiseptic personal care. Through

itsproducts and its hygiene education programs, Dettol has been helping

protect people against illness-causing germs for 90 years. Its biggest

markets include India, China and the UK.

dettol.co.uk

FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORTReckitt Annual Report and Accounts 202317

Durex is the global leader in condoms, with key markets that include China and Europe.

YetDurex is present in less than 1% of global sex occasions and so offers significant

headroom for growth. Recent launches, including polyurethane (PU) condoms and those

lubricated with hyaluronic acid for extra moisture, are continuing to premiumise the portfolio.

Culturally relevant partnerships in fashion and music, including the ‘Diesel x Durex’ capsule

collection presented at Milan Fashion Week, connect the brand to its target audiences.

durex.co.uk

Mucinex is the number two cold

and flu brand in the US, and the

brand most trusted by doctors

for cough and cold symptoms.

Mucinex has a powerful brand

equity, which it uses to expand

into adjacent categories such

as the recent successful launch

of its medicated sore throat

product, Mucinex InstaSoothe.

mucinex.com

The world’s first medicated

lozenge, Strepsils is the leading

brand in sore throat care across

global markets. With an extensive

range of lozenges and sprays,

thebrand helps consumers to

manage their sore throat and

cough symptoms at home,

withformulations that relieve

dryness and pain.

strepsils.co.uk

1 IN 2 WOMEN FEEL THEY

HAVE HAD THEIR PAIN

DISMISSED BECAUSE

OF THEIR GENDER

See our commitments to help

close the Gender Pain Gap at

Nurofen.co.uk/see-my-pain

FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORTReckitt Annual Report and Accounts 202318

Nurofen, the number two analgesic brand in Europe, provides effective pain

relief, leveraging over 30 years of research and development. The 2023

expansion of Nurofen Liquid Capsules into key markets and purpose-led

initiatives like ‘See My Pain’, which aims to narrow the Gender Pain Gap by

highlighting how women’s pain is often ignored or dismissed, continue to

support brand growth.

nurofen.co.uk

With its strong science-backed

reputation for supporting brain health,

the Enfamil family of brands offers

a range of routine and specialty

infant formulas, as well as toddler

nutritional drinks. It is the leading

premium infant nutrition brand

across markets and the number one

paediatrician recommended product

in core markets such as the US.

enfamil.com

Nutramigen, a formula product for

the dietary management of cows’

milk allergy, was the first and is the

most extensively studied formula

of its kind. 75 years after its launch,

it remains the global leader in its

category. The UK’s National Health

Service estimates that CMA affects

around 7% of babies younger than

one year old, underscoring the

brand’s growth opportunity.

nutramigen.co.uk

19 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

People and Culture

Today’s Reckitt is rooted in a culture that

ispurpose driven, entrepreneurial, fast paced

and action oriented. Doing the right thing,

always, is at the centre of our Compass,

whichguides our business alongside the

Leadership Behaviours that drive our success.

SPOTLIGHT ON:

PEOPLE AND CULTURE

We always maintain an unwavering

commitment to our people, whose

passion, energy and professionalism

arethe source of our enduring strength.”

Ranjay Radhakrishnan

Chief Human Resources Officer

A business our people believe in

A powerful combination of our brands, people

and Purpose is what makes Reckitt unique.

Our people believe in and are inspired by

our Purpose and brands. They take pride

in our business and our shared ambition to

achieve. This is evidenced by our annual

employee survey, which in 2023 saw scores

higher than our external benchmark for

pride, strategy and company direction.

This shared vision has been crucial to our

transformation over the last four years. During this

period, we established deep cultural foundations

that empower our people as the key value drivers

of our business and redefined our Leadership

Behaviours to place a greater emphasis on care

as we serve the needs of all our stakeholders.

Around 14,000 colleagues now participate

in one of Reckitt’s all employee share plans.

This nurtures a culture in which individuals are

owners, as well as colleagues and managers.

The result is a business equipped for future

growth and focused on sharing the benefits

of pursuing a cleaner, healthier world.

Fostering success

The investment we make in our future starts

with our people. We want to attract, retain and

develop the best talent. We recognise the desire

of our colleagues to develop their careers. Yet

we acknowledge that personal growth can

take many forms; from building functional skills

and exploring new markets or functions, to

developing management and leadership skills.

Building on feedback received from our

colleagues, we have rejuvenated our approach

to personal growth by adopting a holistic

programme for development in its widestsense.

Do the

right thing.

Always.

Put consumers

and people first

Build shared

success

Seek out new

opportunities

Strive for

excellence

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

People and Culture continued

As well as online resources, we now have 10

functional academies across Reckitt. These

academies curate development content

across specific business functions and enable

employees to attain functional skills based

on their professional development goals.

Each of these academies is augmented by

global programmes, such as an embedded

leadership curriculum and a thriving mentor

and coaching programme, which support

individual goals and the needs of particular

employee groups. These include our Accelerate

for Women and Future Leaders Programmes.

Embedding these skills across our business

is a continual process of development and

renewal. This is vital for an organisation like

ours which purposefully introduces new talent

from outside to complement the wealth of

experience and skills we nurture from within.

This fosters a culture of innovation and change

through fresh thinking, whilst anchoring our

energy in a shared belief in how we deliver

the best outcomes for our business.

Rewarding outcomes

Reckitt is a results-oriented business with astrong

belief in collective accountability. That is why

many of our people are enrolled in, incentivised

by and rewarded through our Annual Performance

Plan (APP). Running each calendar year, this

measures our collective performance against

annual targets linked to Reckitt’s strategic

priorities and tailored to individual markets.

Reckitt’s most senior management participate

in our Long-Term Incentive Plan (LTIP), which

incentivises and rewards long-term performance,

and aligns the interests of our leaders with those

of shareholders. This also delivers a strong focus

on ownership and accountability, toensure

that our Leadership Behaviours provide the

lens through which success is evaluated.

Building a culture of inclusion

Success at Reckitt means excelling as who you

are. Our goal is to provide a working environment

where uniqueness is embraced and inclusion is a

lived experience. We recognise that diversity of

thought is a key driver of performance. With over

40,000 people worldwide drawn from 125 different

nations, we want to represent the countries and

communities we serve through a workplace where

everyone feels able to be their authentic self.

Equally, our aim is for a global workforce profile

that is more aligned with the global consumers,

customers and markets we serve. Together,

our colleagues, our partners and our brands

will drive that change as we reflect the diverse

and inclusive world in which we operate.

Inclusion is given senior focus in Reckitt by

our Global Inclusion Board, which is chaired

by our Group CEO. Its mandate is to drive our

inclusivity agenda throughout our employee

communities, our brand identities and our supply

chain. The Group Board works in partnership

with our Local Inclusion Boards in individual

markets and the growing number of local

chapters of our global Employee Resource

Groups (ERGs), which continue to play a

critical role in driving our inclusion agenda.

ERGs are employee networks that provide

visibility, understanding and support to groups that

may be underrepresented or face barriers in the

workplace. There are four global ERGs, focusing

on LGBTQ+, Women@Reckitt, Race and Ethnicity,

and Disability. Local ERGs maintain a focus in

market, supporting localised inclusion plans.

Thisranges from equipping individuals with

specific skills relating to their function to

developing leadership, resilience and providing

in-role support, both professionally and

personally, through our Wellbeing and Employee

Assistance Programmes. Together, these enable

individuals to realise their full potential.

In April 2023, we introduced a new Learning

Library, which draws on LinkedIn Learning to

provide access to a variety of resources tailored

to different skill levels. Early adoption has been

strong, with over 9,500 unique users. In the last

quarter of the year, we also launched a new

learning experience platform, myDevelopment

Learning, which brings together personalised

learning for professional growth based on the role,

function and career aspirations of each individual.

OUR COMPASS OUR LEADERSHIP BEHAVIOURS

Own

– Live our Purpose, Fight andCompass

– Know our business cold

– Make decisions

Create

– Spot opportunities

– Innovate, iterate andscale

– Relentlessly build better

Deliver

– Focus on what matters

– Move boldly and at pace

– Join forces to win bigger

Care

– Actively listen, learn andinclude

– Speak direct with respect

– Act to unleash potential

21 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

People and Culture continued

2023 saw continued war in Ukraine, a devastating

earthquake hit Turkey and conflict in the Middle

East. Our teams provided financial and mental

health support for affected colleagues. We

were also able to commit over £400k of funds to

alleviate suffering on both sides of the conflict

in the Middle East through our disaster relief

emergency response partner The British Red

Cross, and further matched employee donations.

Whilst the safety of our people is paramount,

we also recognise the importance of employee

health and wellbeing to ensuring our people

can thrive, both at home and in the workplace.

Supporting these is the cornerstone of our

Global Wellbeing Policy, which recognises

mental health as the foundation of a healthy,

happy employee community and a cornerstone

of sustained business performance.

Our Global Wellbeing Hub enables access

toa variety of resources on topics which we

know, through employee surveys, are priorities

for achieving balance and wellbeing at work.

Augmenting this is a global programme of

webinars and events that draw attention to some

of the key issues that challenge wellbeing.

In 2023, these included a Mental Health

Month, a cancer pledge to encourage greater

understanding of working with cancer, and a Global

Steps Challenge, which united colleagues from

more than 30 countries in a physical challenge.

Alongside these global initiatives, our monthly

Wellbeing Boosters sessions provide access

to performance coaches for advice and

support. In 2023, there was a 61% increase

in people leader coaching versus 2022 and

attendance of over 19,000 at our wellbeing

events, a ten-fold increase year on year.

Each of these workplace initiatives is balanced

by individual Employee Assistance Programmes

that provide tailored care for specific

issues, including mental health support.

Fit for the future

Our journey over the past four years has seen

Reckitt realign important aspects of its culture

with its Purpose.

Our goal throughout has been to ensure

ourpeople share a strong sense of purpose

anchored in a deep-rooted culture that

emphasises ownership and accountability

ashallmarks of success.

We live in a changing world. We shall continue

to adapt as we grow. Our Purpose provides

us meaning, builds our resilience and serves

as a north star. We always maintain an

unwavering commitment to our people,

whose passion, energy and professionalism

are the source of our enduring strength.

for more details on developing our people.

See page 51

Through active engagement on workplace

issues, ERGs have been instrumental in driving

change across a range of policies and processes.

These include our shared parental leave, the

development of our Accelerate leadership

programme to support women throughout

their careers, and Reckitt’s conscious inclusion

programme, which highlights unconscious

bias, microaggressions and the steps

everyone can take to promote inclusivity.

Our ERGs have been critical in harnessing a

community-based sense of togetherness and

belonging across Reckitt. Yet we also recognise

that inclusivity is for everyone. We believe that

we are Stronger Together and our ambition is

that all colleagues are welcomed, able to fully

contribute to our business and supported to thrive.

This is a guiding principle behind the next stage

of our inclusivity journey. In 2023, we hosted

a global Stronger Together event to promote

allyship and foster an understanding of how to

be an active ally to each other. Through similar

events and workplace initiatives, we shall continue

to extend conversations beyond our ERGs to

make inclusivity an aspect of our culture that

everyone can relate to and take responsibility for.

Health, safety and wellbeing

Our commitment to caring for our people

goestothe heart of our Purpose to protect,

healand nurture. This means promoting and

safeguarding wellbeing, as well as ensuring

safetyin our workplace.

Our primary concern is that our people are safe at

work, irrespective of what they do or where they

live. With a global business spread throughout 68

countries, we ensure we have mature systems in

place that enable us to step in quickly to support

our people and their families in times of need.

22 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Scientific Innovation

We combine deep consumer insights

with cutting-edge science to create

differentiated, superior solutions that

bring delight to consumers everywhere.

SPOTLIGHT ON:

SCIENTIFIC INNOVATION

Our goal is to unleash the ‘Science Inside’

Reckitt through the very best and most

trusted brands.”

Angela Naef

Chief R&D Officer

Our innovation capabilities

Innovation is harnessed through the global

capabilities we possess across the Group, including

R&D, Marketing, Sales and Supply. These teams

work together with in-market experts to build a

deep understanding of the consumer, connecting

this with great science to develop products that

delight our consumers and meet their everyday

needs. Our Supply team then enable us to execute

with excellence by delivering these through their

best-in-class route-to-market capabilities.

Within our Global Business Units, our Category

Development Organisations create and grow

categories through consumer-focused innovation

that extends Reckitt’s brands into adjacent white

spaces. This team has developed industry-leading

ways of combining consumer insights with our

science capabilities that enable us to extend our

categories and identify new spaces for growth.

Through our leading R&D capabilities, we have

elevated the ‘Science Inside’ our business to

create enduring value through our brands.

We have built rigour, discipline and precision

across our R&D activities to ensure our science

can travel across our categories. This enables

greater degrees of freedom in designing new

products and provides us with a longer-term

lens through which to innovate, reinforcing the

sustainability and growth potential of our brands.

With targeted R&D investment, we have built

new capabilities in medical sciences that enable

us to generate superior evidence. Alongside

this, investment in our regulatory intelligence

capabilities helps us to identify and anticipate

changes in our regulatory landscape. This enables

us to drive advocacy that opens channels and

routes to market for our innovations so that we

can put new products in the hands of consumers.

23 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Scientific Innovation continued

ongoing interaction with our stakeholders and

amindset of regulatory foresight that anticipates

how future changes may impact them.

Our third priority is Driving Productivity. We pursue

this with our Supply colleagues and partners

to ensure innovation delivers on the Group’s

productivity goals. This involves optimising our

supply of raw materials by qualifying suppliers

to drive the best procurement choices, and

refining our processes to ensure we balance

capacity across our manufacturing.

Extending our growth runways

As well as supporting our current growth

ambitions, innovation equips us to anticipate

and plan for the future. This means being

able to look through a longer-term lens

and anticipate change though a multi-

generational approach to R&D planning.

Our investment in PU technology for Durex

condoms in China is an example. This captured

a shift in consumer preferences, but also

reshaped our manufacturing process and

resulted in the establishment of a new

Polymer Science and Technology platform.

Now one of nine foundational disciplines that

shape our science capabilities across the

Company, this platform brings together polymer

scientists to design methods of PU use across our

brands that meet consumer needs as they evolve.

Throughout, we made sure this science travels:

polymer science has since crossed categories

into Hygiene and the thermoform technology

we use in our Finish dishwasher tablets.

Innovation draws continually on our science

capabilities to develop and extend products that

improve the consumer experience of our brands.

Our Nutrition Innovation pipeline is closely linked

to our rich science heritage and capabilities,

allowing us to develop nutritional solutions that

give babies the best start in life, as well as to

provide the foundation for life-long health.

Our scientific commitment and cutting-edge

studies are advancing the field of paediatric

nutrition globally. This was showcased in one

ofour recent clinical publications, which gained

widespread recognition for its findings relating

to our Enfamil formula enriched with milk fat

globule membrane (MFGM). This showed lasting

brain benefits at the age of five-and-a-half

years in children who were fed this formulation

in their first year, exemplifying our longer-term

approach of extending clinical research on

our formulas beyond infancy (see page 35).

Similarly, in 2023 our Intimate Wellness team

also achieved a significant scientific milestone

This is a source of competitive advantage

through which we offer consumers a greater

choice of safe and effective solutions that

anticipate their present and future needs.

Our approach to R&D is driven by a strong

commercial focus and an innovation culture

thatfosters collaboration. We focus on strategic

choices that help us to build critical capabilities

that unlock value and drive step changes

ingrowth.

Framing our strategy

The megatrends behind Reckitt’s four global

challenges (see page 07) provide the strategic

frame that determines where we innovate and

channel our R&D. These guide our long-term

thinking and ensure the commercial opportunities

we pursue offer lasting social benefits.

We think about Innovation at Reckitt not as a

function, but as an outcome. Its impact is guided

by three priorities, which taken together define

the role of R&D in our growth ambitions.

The first we call Innovate Impactfully. This

captures the value we create by innovating to

drive sustainable top-line growth. By focusing

on value as an outcome, we introduce financial

rigour wherever we innovate, from formulation

through to product packaging, our science-based

claims and methods of delivery. We maximise

innovation’s impact through a ‘touch it once’

approach, which means that innovation in one

science platform travels across the organisation

to offer benefit to all brands and categories.

The second priority we refer to as Securing

the Company. This safeguards the lifecycle of

our products to ensure they remain relevant,

compliant and progressive as regulations and

consumer preferences evolve. It requires

The ‘Science Inside’ Reckitt:

supercharging science

todelightconsumers

The ‘Science Inside’ Reckitt is a global

community of over 3,000 scientists spanning

nine centres of excellence. It provides us

with the capability not only to create a

new and disruptive product like Lysol Air

Sanitiser, but also to partner with regulators

to develop standards for this new category.

We connect the expertise in Reckitt across nine

scientific platforms to our deep knowledge

of consumers. Within these, we innovate new

products that solve unmet consumer needs and

deliver our growth ambitions. The pursuit of

scientific excellence has transformed Reckitt’s

R&D. By connecting our science platforms, we

ensure our science travels across Reckitt so

that we can deliver for consumers everywhere.

In 2023, our Hull Science and Innovation

Centre hosted our first annual ‘Science Inside’

Symposium. Our community came together

to celebrate, recognise and connect.

Witha focus on peer-based scientific review,

900 authors from 21 countries submitted

over 300 abstracts for debate, from which

113 were selected for discussion.

By fostering a culture of collaborative

innovation, the Symposium epitomises how

the ‘Science Inside’ Reckitt harnesses our

science goals to our ambition to deliver

ever-greater value for our consumers.

CASE STUDY

24 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Scientific Innovation continued

Reckitt’s Sustainable Innovation Calculator helps

guide us to the right decisions throughout the

innovation process. It measures the impact of

anew product by rating its ingredients, plastics,

packaging, carbon and water performance,

as well as evaluating its extended producer

responsibility risk. By comparing these data

with existing product ratings, we are able

to identify alternatives that offer better

environmental outcomes (see page 47).

This approach helped shape our Finish Ultimate

Plus dishwasher product, which offers superior

wash performance alongside a 20% reduction

in chemicals use. This enables consumers to

‘Skip the Rinse’ and helps to save many millions

of litres of water every year across the world.

It also drove the development of Harpic Hygienic

and Fresh, the very first self-sticking toilet block.

This uses a biodegradable polyvinyl alcohol

wrap that sticks to the inside of the toilet bowl,

removing the need for a plastic cage to hold

the block in place. It also dissolves with use.

Theresultis a considerable reduction in plastic

anda product that consumers love for its simplicity.

Our Sustainable Innovation Calculator considers

key aspects of the product lifecycle to ensure

innovation contributes positively to our

sustainability targets. This has helped us identify

new opportunities to reduce our use of plastics,

carbon and water. It has also cultivated a mindset

of continuous improvement across our categories

backed by hard data to drive positive outcomes.

Harnessing the benefits

of Artificial Intelligence

Reckitt has been involved in complex dataset

processing for many years, which has driven

astep-change in our ability to understand

theneeds of consumers. We already leverage

machine learning and advanced analytics

across consumer research, into consumer

activation touchpoints, and to plan, measure

and steer our digital campaigns in real-time.

AI enables us to extend these capabilities to

additional datasets, including unstructured text

shared through sensory evaluations, consumer

trials, and ratings and reviews. These offer

insight on an unprecedented level that will

transform our relationship with consumers

as we innovate the products of the future.

We are constantly evaluating the wealth of

value that AI can offer as we deepen our

understanding of its capabilities, its risks and

the opportunities it unlocks. We have focused

our efforts on accelerating the adoption and

impact of AI across our business, from R&D

and manufacturing to sales, marketing and

logistics. We are identifying high-value use

cases, expediting AI project implementation

and reducing barriers to AI innovation. Our

objective throughout is to deliver AI-driven

results efficiently and responsibly.

For example, AI-driven simulation and

modelling are enabling us to achieve our

innovation and sustainability goals within

R&D and manufacturing. It is also boosting

productivity by shortening our product

development lifecycles. As these capabilities

scale, we will be able to conceive, design and

prototype a growing number of new products

in the digital-first world, trialling hundreds of

different potential variations that simply would

not be possible without the human–machine

partnership opportunities that AI offers.

At the same time, we are mindful that the

nature of this new technology and the speed

at which these tools are being developed

can, if unchecked, impact issues such as

data privacy, biases and content accuracy.

In 2023, we introduced an AI Tools Policy

to encourage our people to embrace the

responsible use of AI tools in the workplace

so that we may enjoy the productivity

benefits and creativity they can unlock.

in a clinical trial involving the reformulation of

our lubrication portfolio. Driven by our R&D

team, the resulting study

was acknowledged

by the International Society of Sexual

Medicine as the Best Paper of 2023 in Female

Sexual medicine. These demonstrations of

scientific leadership illustrate the depth of

clinical and medical expertise within our

categories, which serve our global community

of healthcare providers and consumers and

position our brands for future growth.

Driving sustainable outcomes

Sustainability is a governing principle for Reckitt.

Everything we do aims to create more enduring,

relevant products that captivate and delight

our consumers, whilst delivering on our Purpose

and progressing our sustainability goals. These

include our ambition for 50% of our net revenue

tocome from more sustainable products by 2030.

1. A randomised trial on the effectiveness and safety of five

water-based personal lubricants. The Journal of Sexual

Medicine, Volume 20, Issue 4, April 2023, pages 498-506

Generative AI will unlock significant new opportunities

for Reckitt. By maintaining a strong focus on data

foundations and quality, we can ensure that this

technology becomes a true competitive advantage.”

Filippo Catalano

Chief Information & Digitisation Officer

25 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Supply Chain

Our supply chain is the operational

backbone that enables us to deliver

on our Purpose.

SPOTLIGHT ON:

OUR SUPPLY CHAIN

Our priority is to ensure we have the depth,

agility and resilience to respond to an

increasingly complex global supply network.”

Sami Naffakh

Chief Supply Officer

Investing in our supply strategy

During 2023 our global supply chain was impacted

by macroeconomic issues such as inflation and

geopolitical instability, causing fluctuations

in supply and demand. The investments we

have made in the resilience and flexibility of

our supply chain enabled us to mitigate the

impact of these, whilst strengthening our

relationships with suppliers and customers.

Our investment priorities have been

underpinned by the four pillars of our supply

strategy. Each pillar is fundamental to our

Purpose, the success of our business and the

returns we generate for our shareholders.

The first pillar ensures we embed care and

responsibility in everything we do. This means

protecting our consumers through product quality

and value, keeping our people safe and managing

the impact of our activities on communities

and our planet. This commitment ensures we

provide our consumers with reliable products

that are safe and deliver on their brand promise.

Responsibility and care for our people involves

an immutable commitment to health and

safety. We continue to strengthen processes to

safeguard both, whilst recognising that health

and safety cannot flourish without a genuine

safety culture, a responsibility and commitment

we place at the heart of our business.

The second pillar drives operational excellence

across all supply. Our goal is to build a world-class

supply function that delivers outstanding customer

service and excellence in execution to meet the

needs of consumers and customers, both today and

in the future. Fundamental to achieving this is the

excellence programmes we have launched across

all our supply sub-functions. Through these, we

have made targeted investments in new technology

26 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Supply Chain continued

In manufacturing, our Reckitt Production System

(RPS) is now a key driver of our on-site productivity

capabilities. RPS is helping us pilot several

packaging optimisation projects that reduce

costs, whilst meeting the needs of our customers

and consumers around sustainable materials.

Our Reckitt Logistics Excellence programme

is providing new tools, capabilities and

standards to improve productivity and costs

inwarehousing and transport operations.

AndourCustomer Fulfilment Excellence

programme is improving the way we collaborate

and serve our customers, whilst optimising our

internal processes to support their needs.

to develop our productivity muscle near term

andboost our competitive advantage long term.

An example is procurement, where we have

developed a digital risk management platform

that enhances our operational resilience by

identifying and mitigating risks associated with

the supply of materials. We have also invested in

advanced market-based analytical capabilities

to provide our buyers with greater visibility

on how we can best direct our spending.

In end-to-end planning, we have redesigned

our activities from a process, operating model

and systems perspective in order to improve

service, optimise our inventory levels and the

utilisation of our assets and to reduce our costs.

The fourth pillar captures the importance of our

people to Reckitt’s success. This means investing

in skills, promoting diversity and fostering an

inclusive working environment that enables

our employees to realise their full potential

andour Company to deliver on our ambitions.

Each of our people initiatives have been

supported through a variety of training and

development resources, including our Future

Leaders programme, Personal Development

Plans and a Supply Academy, as well as a

strong community of experts we have nurtured

across the Company. These people foundations

remain important resources as we build on our

achievements and extend the reach of these

new capabilities across supply (see page 50).

Sustainable customer partnerships

Our customer relationships are vital to our

market presence and a source of competitive

advantage. Strengthening these during volatile

periods for supply and demand has been a

key priority for us. This involves continuous

improvements in forecasting, developing

tactical solutions to drive better, more reliable

service levels and strengthening communication

and engagement to fuel future growth.

In parallel, we have developed an entirely new

Customer Service Excellence Playbook, which

we are now rolling out as best practice across

all our markets and regions. This is a multi-year

roadmap for achieving best-in-class customer

service globally. It has aligned our focus and

driven sustained service improvement, better

customer engagement and a reduced cost

to serve, whilst supporting increased sales

growth and better employee engagement.

Throughout, we continue to use our scale

and reach to influence positive change and

impact across our value chain. This includes

promoting supplier diversity, embedding

measures to help secure sustainable livelihoods

for our suppliers and increasing the use of

recyclable and reusable packaging. Each

of these were key initiatives in 2023 as we

worked to boost responsible procurement

andreinforce the sustainability of our supply.

The third pillar is to deliver a supply chain for

the future. Here, we have strengthened the

resilience of our manufacturing by reducing

mono-sourcing, localising production and

digitising key components of our supply function

to ensure we have the network, assets and

capabilities that will enable our future growth.

Raw material sourcing is a case in point. Many

of our products, including Dettol soaps, Durex

condoms and our infant nutrition formulas,

are exposed to naturally-sourced agricultural

commodities. Their supply can be affected

by geopolitical events, weather and other

disruptions. Through greater agility and

flexibility in procurement and by adapting

our sourcing strategies, we are able to

mitigate these impacts more effectively.

We have also built greater redundancy into our

supply arrangements to mitigate risk around

single-source procurement. This includes infant

formula, where we have forged alternative

supply for the US market through our plants

in Mexico and Singapore. And by developing

our own supply capabilities, we have in some

instances moved ourselves up the value

chain. This includes our VMS category, where

we are now in-sourcing vitamin and mineral

blends in our Evansville facility in the US.

27 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Supply Chain continued

This structured approach places collaboration

and dialogue at the centre of our customer

relationships. It involves listening closely to

customer needs and serving these though a

partnership that integrates sales and supply

across our product platform. The benefits are

mutual: it improves our ability to deliver whilst

lowering our cost to serve through, for example,

encouraging more efficient order weights

and a greater reliance on no-touch orders.

Technology and digitisation

Technology is a key enabler of change across

oursupply chain. The improvements it has

broughtabout have in large part been enabled

through an accelerated digitisation of our

supplysub-functions.

Our Taicang plant in China is a great example.

Our newest and largest site in this high-growth

market, Taicang is equipped with some of the

most advanced automation technology available

to create a manufacturing facility that is fully

digitally native (see case study opposite).

Technology has also played a key role in lessening

the financial impact of market volatility, whilst

helping us to mitigate its risks. As a key element

of our Commodity Risk Management process,

technology is enabling greater market insight

through new real-time capabilities in feedstock

trend analysis, demand-supply evolution and

historical price data. These are enabling us to

make smarter decisions in hedging, fixed price

contracts and forward booking, which in turn help

us to reduce our exposure to market volatility.

Sharing this market insight deepens our supply

partnerships. Our capabilities ensure we

remain agile in responding to changing market

conditions and continue to be an attractive,

competitive buyer, whilst helping us to manage

risk. The objective throughout is to maximise

the benefits we can realise through the choices

we make across supply. This helps us achieve

sustainable, profitable growth and higher

returns through faster in-market execution.

As we progress our digitisation journey, technology

will be an ongoing enabler of productivity

and quality benefits through monitoring our

complex supply chains and identifying potential

issues and opportunities as they arise.

Continuity and maturity are themes for the

year ahead as we realise further benefits

from the investments we have made.

Building shared success:

our Taicang manufacturing plant

Taicang is our fifth, most recent and largest

manufacturing plant in China. It produces

Dettol for the people of China, with an annual

production capacity of 100,000 tonnes.

Committed as a greenfield site in 2019,

Taicang was built and operational within

three years; quite an achievement given this

period spanned the COVID-19 pandemic.

As a site, Taicang is fully digitally native, with

some of the most advanced automation and

systems available. Utilising Reckitt’s global

Production Management System, the factory

is equipped with a variety of digital systems

that empower management with data as an

asset to drive innovation and development.

These include Taicang’s Automated

Storage and Retrieval System warehousing

technology, which enables us to organise

the movement of pallets efficiently

and within a much tighter space than

traditional forklift racking systems allow.

By localising the production of Dettol

and providing us with options on further

expansion, Taicang is crucial to delivering

on our growth ambitions in China.

CASE STUDY

HOME

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Hygiene

HYGIENE

Market-leading brands with purpose

Our Hygiene portfolio extends over six core

categories. These include world-class brands that

lead their markets and enjoy high levels of consumer

trust. Each is supported by a clear and consistent

consumer-focused growth model based on driving

market penetration and brand extension. Our brands

earn industry-leading margins thanks to the strength

of their brand equity, our innovation capabilities

and our ongoing investment in productivity.

What unites our brands is a shared belief in

hygiene as the foundation of health. The COVID-19

pandemic underscored the vital importance

of this, particularly in our crowded cities and

shared spaces where good hygiene isan

effective barrier to the spread of infection.

Population growth and mobility, as well as

global warming, are placing unprecedented

strains on sanitation and water resources in

many parts of the world. These are essential

public health priorities that our brands help to

address. A growing middle class in these markets

is driving greater adoption of our brands as

consumers seek the benefits they provide.

Attractive growth opportunities

Our Hygiene brands have very strong and distinct

brand equity and benefit from high levels of

consumer awareness. Yet their global penetration

remains low, particularly in developing markets.

Dishwasher ownership is just 13% globally and

in the UK fewer than one in five households use

either a sanitiser or stain removal product in their

general laundry wash. This provides our category-

leading brands like Finish in dishwashing, Lysol in

laundry sanitisers and Vanish in stain removers

with significant headroom for growth as rising

household incomes and growing awareness of

their benefits drive adoption rates higher.

Our Hygiene business comprises category-

leading brands anchoredinour Purpose.

Each enjoys attractive growth opportunities

driven by global megatrends and rising

household adoption.

We keep raising the bar on

how we execute and build

ourbrands to improve our

consumers’ lives and grow

ourcustomers’ categories.”

Volker Kuhn

President Hygiene

Surface & Disinfection

Lavatory Care

#1 Globally

Auto Dishwash

Other

#1 Globally

Fabric AdditivesAir Care

#3 Globally #1 Globally

Our categories

Category Profile

1. Based on FY23 net revenue

Geographical Profile

Surface & Disinfection

Auto Dishwash

Air Care

Fabric Additives

Lavatory Care

Other

North America

Europe/ANZ

Developing Markets

29 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Hygiene continued

Similarly, two new brand extensions to AirWick

helped us to deliver further category growth

through premium products that attract higher

pricing per dose. Air Wick’s new Vibrant

range offers an improved scent experience

delivered via an anti-fade technology infused

with more essential oils than our regular

scented oils. Meanwhile, 24/7 Active Fresh is

our first aerosol-free spray, which is delighting

the market with a range of natural-smelling

fragrances our consumers tell us they enjoy.

Brand extensions like these demonstrate our

ability to galvanise consumer loyalty to drive

category growth through innovation that

extends product performance. Leveraging the

strength and depth of our science platforms is

fundamental to this process, providing us with

market-leading technology and chemistry that are

enduring sources of our competitive advantage.

Delivering sustainable outcomes

Sustainable business principles are at the heart

of our Purpose. They find expression throughout

our Hygiene categories, both in terms of the

health-based principles we support and the

environmental impacts we seek to mitigate.

Core to our strategy is developing products that

deliver superior performance at lower levels of

resource use, like the CycleSync technology we have

introduced in Finish Ultimate Plus (see case study).

Premiumisation and sustainability reinforce each

other as we deliver superior, more sustainable

solutions that provide us with a greater share of

the consumer wallet, whilst helping consumers

toreduce their overall spend on energy and water

during use. This shares the benefits of innovation

and secures inherently sustainable outcomes as

wedeepen our consumer value proposition through

brands with lighter environmental footprints.

Our Hygiene portfolio enjoys strong growth

characteristics. In 2023, our categories saw

between mid-single-digit and double-digit

year-on-year market growth. In Surface

andDisinfection, Lysol is the world’s largest

disinfection brand and its growth in the most

recent years has been driven by new household

penetration and expansion into adjacent

categories as we leverage Lysol’s brand

equitythrough innovation.

The depth of our brand equity in each category

is rooted in strong consumer trust and loyalty,

which reflect our commitment to premium

brands with a reputation for outperformance.

The result is a profitable portfolio with high rates

of return and attractive margins. We underpin

these with a constant focus on productivity and

the strength of our go-to-market capabilities.

Coupled with the significant Group-wide

investments we have made in our supply chain

capabilities, we are now closer to our customers

than ever and able to serve them better.

Innovation-led growth

Innovation is critical to our brand success in

the attractive categories in which we play. Our

DNA is to create and grow categories through

consumer-focused innovation that extends

brands into adjacent white spaces. We delight

consumers by developing new formulations and

superior products through a problem-solving,

solutions-based approach to their needs.

By applying our polymer science expertise

to the thermoform technology used in

our Finish dishwasher tablets, we have

secured significant growth and market

share gains for our premium Finish products,

which adopt this surface chemistry.

Finish Ultimate Plus: driving

growthand penetration

throughpremiumisation

Auto Dishwash is one of our biggest Hygiene

categories. It is also one in which our brand Finish

is the global market leader. Auto Dishwash has

delivered double-digit compound growth over

the past five years as we have driven market

share though innovation and premiumisation.

Five years ago, 95% of our revenue from

monodose detergents was generated by

hard-pressed tablets. Since then, we have

introduced different tiers of premium-

priced thermoformed tablets. Now, around

two-thirds of the revenue of monodose

detergent is coming from new technologies.

In 2023, we launched Finish Ultimate Plus,

ourbest-performing detergent yet, in Europe

and the US.

Finish Ultimate Plus uses our CycleSync

technology, which phases the release of

the tablet’s detergents to match the wash

cycle. Not only does this deliver better

results, but as with all thermoform portfolio,

enables consumers to ‘Skip the Rinse’

and helps to save many millions of litres

of water every year across the world.

Auto Dishwash has enormous upside in

category penetration. Global dishwasher

penetration remains at 13% globally and

is lower still in emerging markets like

India, China and Brazil where it is less than

3%. We are actively partnering with the

leading dishwashing machine brands to

encourage consumer adoption, both in

emerging markets and developed ones.

CASE STUDY

30 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Hygiene continued

Innovation also plays a key role in enabling us to

reduce the use of virgin plastic in our packaging

and maximise recyclability of components,

thereby contributing to progress against

our sustainability targets (see page 49).

Outlook and ambitions

Our Hygiene business enters 2024 with an

abundance of opportunity. Our brand leadership

and innovation capabilities position us well

toextend the value proposition we offer

ourconsumers in categories where global

penetration rates remain low.

We continue to reap the benefits of

investment in our execution capabilities

through our ability to leverage technologies,

data, our partnerships and our scale.

Low global penetration rates in many of

our categories provide us with long growth

runwaysfor penetration and brand extensions.

So, too, do opportunities to deepen consumer

engagement in categories like Air Care, where

we see in some markets, consumers who buy

two segments or more spending on average four

times more than those buying a single product.

Similarly, premiumisation will continue to

encourage consumers to trade-up to products

that offer a stronger value proposition at higher

price points. This includes the Fabric Additives

category, where an average Vanish user is

delivering three times the revenue per wash

compared with one using detergent alone.

A mindset of continuous improvement

unites our teams and ensures that growth

through innovation will remain our constant.

Premiumisation and growing penetration are

core to our strategy as we look for future

opportunities to create new categories through

market-leading brands that our consumers love.

Throughout, serving consumers and their

needs is fundamental to everything we do,

as is delivering the benefits of the cleaner,

healthier world our brands enable.

for details of our 2023 financial performance in Hygiene.

See page 42

Vanish Oxi-Action: reducing energy

use through cooler wash cycles

Vanish is the world’s leading stain remover

brand. It enjoys a number one position in more

than three-quarters of its markets. Yet with

less than 10% global household penetration,

premiumisation provides us with headroom

for considerable growth as we innovate and

extend Vanish’s considerable brand equity.

In 2023, we upgraded Vanish’s stain removal

capabilities through Vanish Oxi-Action,

anewformulation that gives better

performance at cooler 20°C wash cycles

thanwith a detergent alone at 40°C.

Anewpatented oxi-action catalyst makes

thispossible, enabling even the toughest stains

to be removed in extreme test conditions

without the help of high wash temperatures.

This helps make clothes last longer whilst

reducing energy use.

As well as helping to drive category

penetration through premiumisation,

VanishOxi-Action is a great example of

how we innovate products that deliver

a strong consumer value proposition

alongside better environmental outcomes.

CASE STUDY

Lysol Air Sanitiser: innovating for

unmet consumer needs

2023 the introduction of a product that

defines the future of Air Care: Lysol

Air Sanitiser, a spray that kills 99.9%

ofairborne viruses and bacteria whilst

eliminating bacterial odours in the air.

Lysol Air Sanitiser is a first-of-its-kind

in the Air Care category: an entirely

new product that combines a sanitiser

and bacterial odour eliminator in one.

It epitomises how our science-backed

innovation enables us to develop new

products on the shoulders of very strong

brand equity and consumer trust.

Launching in the US, the product

reached retail shelves in Q3 to a very

warm responsefrom customers and

consumers, with two of its product variants

reaching the top five Stock Keeping Units

(SKUs) by rotation in the Instant Action

category within the first three months.

CASE STUDY

31 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Health

Category Profile

Geographical Profile

HEALTH

A portfolio of market-leading brands

Our Health portfolio enables us to deliver

Reckitt’s Purpose to protect, heal and nurture

in the pursuit of a cleaner, healthier world.

Ours is a portfolio differentiated by the quality

of our brands and our geographic footprint. Our

exceptionally strong brands, including Mucinex,

Durex, Dettol, Strepsils and Nurofen, offer high

growth opportunities and an excellent margin

structure. Combined with our geographic

diversification, we are well positioned to serve

a wide range of health and wellness needs.

We are selective about where we play and are

focused on five key categories: OTC, Intimate

Wellness, Germ Protection, VMS and Personal Care.

Our brands possess considerable equity and

continue to earn high levels of consumer trust,

which allows them to extend into adjacent

white space opportunities, often crossing

consumer categories. This horizontal reach

brings with it an abundance of premiumisation

opportunities as we extend our relationship

with the consumer, evolving our brands to

match their changing needs and behaviours.

OTC

OTC is the biggest category in our Health

business and enjoys high growth and high

margins across our sub-categories, including pain,

gastrointestinal and upper respiratory. Since2019,

our OTC business has added over £1 billion in

net revenue. Innovation continues to extend

itsmarket reach and we continue to invest in both

short- and long-term innovation opportunities.

In the US, the extension of Mucinex into

the treatment of sore throats through the

introduction of Mucinex InstaSoothe drew

on scientific expertise from Strepsils.

Our Health business brings together

a portfolio of market-leading brands

that define their categories and are

synonymous with day-to-day health

and wellness needs.

Our brands possess considerable

equity and continue to earn

highlevels of consumer

trust,which allow

themtoextend

intoadjacentwhite

spaceopportunities.”

Germ Protection

OTC

#1 Globally

#1 Globally in

Upper GI

#2 US in

Cold & Flu

#2 Europe in

Analgesics

#1 Globally in

Sore Throat

VMS Personal Care

#3 US in Bone

& Joint Care

#2 US in Brain

Supplement

#1 Globally in

Depilatories

Intimate Wellness

#1 Globally

Our categories

Pat Sly

President Health

OTC

Intimate Wellness

Germ Protection

VMS

Personal Care

North America

Europe/ANZ

Developing Markets

1. Based on FY23 net revenue

32 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Health continued

Itsecured a meaningful share of the US sore

throat category within a year of launch.

Pain is an important sub-category within our

OTC portfolio. Nurofen continues to offer

opportunities to expand into white spaces.

In 2023, we made significant progress in

establishing Nurofen in some of the most

attractive adult pain markets in Europe through

Nurofen Liquid Capsules and are seeing early

success versus our initial launch targets.

Through our multi-year ‘See My Pain’ campaign

in the UK, Nurofen has highlighted the gender

pain gap, with over 50% of women sharing an

experience of pain being ignored or dismissed.

Now in its second year, the campaign has

recently launched ‘PAINPASS’, a tool to enable

women to have data-centred conversations

around their pain and its management with their

healthcare providers. This campaign was shaped

by extensive research and insights generated

by our Medical Affairs and Medical Marketing

teams and continues to build brand equity.

The 2021 acquisition of Biofreeze, a market leader

in topical pain relief in the US, provided us with

a brand extension opportunity through a night

formulation that meets an underserved consumer

need. During 2023, our launch of Biofreeze in

France enjoyed early success with consumers

and continues to build on the successful

international rollout of the Biofreeze brand.

Intimate Wellness

Durex maintains its position as the global

market leader in condoms and we continue to

see growth in our KY portfolio. We have built

asuccessful Intimate Wellness business, which

enjoys significant headroom for growth given

that our products are currently used in less than

1% of global sex occasions. We are continuing

to extend our Durex brand through a new range

of intimate devices, which launched in the

second half of 2023. Our innovation agenda has

allowed us to launch more premium offerings

in our condom and lubricants portfolio, which

have enabled us to cover a range of increasingly

premium pricing tiers in many markets.

By continuing to invest in our materials science

platform, we are bringing innovative new products

to market across our latex and PU condom

portfolios. We recently launched a new hyaluronic

acid-lubricated condom in China, Durex Fetherlite,

which delivers additional moisturising benefits.

Our Intimate Wellness portfolio in China was a

strong contributor to sales during 2023. Through

ongoing innovation and a revitalised China

strategy, we have seen positive competitive

momentum in the business and continued

growth of our PU condoms franchise.

Germ protection

As the number one antiseptic liquid brand globally,

Dettol is an expansive brand that can traverse

categories. This has enabled us to extend the

brand from antiseptic use for cuts and wounds

to personal care, laundry and the disinfection

of household surfaces and appliances. Yet with

around 20% penetration globally, Dettol enjoys

considerable headroom for further growth,

particularly in developing markets where

a growing middle class is devoting greater

spend to health, hygiene and personal care.

In India and China, we have been particularly

successful in leveraging Dettol’s brand equity

into a growing number of new product spaces,

stretching its reach across home hygiene and

personal care and enabling us to compete

in different market tiers. These range from

soaps and handwash to our premium range

of Dettol-based bath and shower products.

Strepsils investment in increased

capacity to meet sustained

highdemand

Through investment at Reckitt’s

manufacturing sites in Nottingham, UK and

Bangplee, Thailand, we’ve built increased

capacity to enable us to continue to meet

sustained high demand for Strepsils.

This brand has broad shoulders, offering

significant opportunities for expansion,

as we’ve seen recently with the launch of

Strepsils Cough in Australia, which meets

an additional consumer need through one

of our trusted, efficacious solutions. This

mirrors the similar, recent extension of our

Mucinex category in the US into sore throat

with the launch of Mucinex InstaSoothe.

CASE STUDY

Durex hyaluronic acid-

lubricatedcondom

Launched in China, Durex Fetherlite is a new,

premium product which offers a water-

based, hyaluronic acid-lubricated condom

which delivers an additional consumer

benefit through the moisturising properties

of hyaluronic acid. This product was the

result of an incredibly fast innovation cycle,

from ideation through to delivery in under

12 months, and achieved a leading share of

this segment within its first year in market.

CASE STUDY

33 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Health continued

We never lose sight of the fact that our customers

are the key point of interaction between

our brands and the consumer. Throughthe

strength of our customer relationships, we

help influence, shape and drive our ambition

to enable better care for consumers’ health.

We draw on our customer partnerships early

when developing consumer initiatives designed

to bring about critical changes in behaviour. That

was the approach we adopted with Tesco in the

UK to drive the adoption of refills for our Dettol

surface cleanser trigger bottle, which not only

reduced packaging but also provides consumers

with a more sustainable, better value alternative.

Shaping the digital journey

Digital channels play an important role in shaping

the customer relationship with our health brands.

We leverage a wide range of capabilities to

improve our understanding of consumer needs

and behaviour, complementing these with

avariety of fulfilment capabilities that enable

us to enhance online engagement and sales.

For Intimate Wellness, digital channels are already

fundamental to our success since they provide

a more discrete medium through which to

engage, educate and then fulfil. Nowhere is this

more so than in China, where this combination

enabled the market success we achieved with

Durex PU, and where we continue to invest

in our live-commerce capabilities to enable

effective direct-to-consumer operations.

In other categories, we are continuing to

scale our e-commerce and digital capabilities

to cement the brand leadership we enjoy.

These include Dettol, where we have doubled

the size of our e-commerce business over

the last four years to around 20% of sales,

but still have ample headroom to grow.

Here, as elsewhere, we are excited by

developments in machine learning and AI

inhelping to guide where our brands should

play. We are already using a wide range of

consumer datapoints across multiple machine

learning algorithms to direct our campaigns

and engagement activities. These are used

alongside a proprietary marketing return on

investment capability, offering us a material

uplift in returns on our marketing spend.

Technology is also improving our execution

across channels. As we continue to see the

rise of new ways of shopping, we are using our

rich data insights to fully leverage AI, including

its conversational and creative capabilities, to

develop entirely new experiences for consumers.

Outlook and priorities

Leveraging the leading positions and scale of our

brands in high-growth categories, we continue

to build on the momentum we enjoy through

trusted products that can provide new benefits

and define new usage occasions. Stretching our

considerable brand equities to close adjacent

white spaces with efficacious products will

remain our focus as we innovate to meet new

health and wellness needs in a sustainable way.

for details of our 2023 financial performance in Health.

See page 43

Together, these deepen Dettol’s brand equity

and enable us to strengthen our market

presence through brand extensions.

VMS and Personal Care

In our VMS category, which includes Neuriva,

Airborne and Move Free, we continue to focus

on establishing leading positions in key areas of

consumer need. The recent launch in the US for

Neuriva Ultra is designed to deliver mental alertness

from the first serving and supports seven indicators

of brain health: mental alertness, reasoning, memory,

focus, concentration, learning and accuracy.

Move Free continues to grow in China, where it

serves a growing number of older people for

whom pain and joint health are top personal

health concerns. We see significant, expandable

equity for the brand and the opportunity to

deliver increased joint health and additional

benefit products through further innovation.

In Personal Care, the launch of our Veet Total Pro

intimate hair removal kit has seen it become a best

seller on European online platforms. Wecontinue

to invest in improved formulations across the

Veet portfolio. Our Veet depilatory products

enjoy some of the highest consumer repeat

rates in their category, particularly in France.

Winning through the consumer experience

The consumer’s experience of our brands is

fundamental to our market success. Wefocus

on developing the most effective solutions

in the categories where we play, and on

designing products that help consumers

maximise their ‘health span’: the proportion

of their life they can live feeling healthy and

well. Throughout, we leverage a wealth of

consumer insight and deep science platforms

to formulate, test and deliver our products to

the very highest quality and safety standards.

Dettol laundry expansion

inGreaterChina

Through the expansion of our Dettol

4-in-1 laundry pods into offline channels

in Hong Kong, and the launch of Dettol

Washing Machine Cleaner in China, the

laundry category in the Greater China

region is now a significant contributor

to our growth. Dettol products are

scoring well ahead of rival brands in

in-store performance across the region

and Dettol Washing Machine Cleaner

isperforming ahead of expectations.

CASE STUDY

Lactum

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Nutrition

NUTRITION

A specialised, science-led portfolio

Our infant formula and toddler products

lead their categories and earn trust through

an immutable commitment to quality that is

deeply rooted in our Purpose. We bring that

Purpose to life through a strong innovation

and clinical research pipeline that delivers the

latest inscientific advances to our consumers.

Our Nutrition business comprises some of the

world’s leading brands in infant and toddler

formula alongside a growing brand presence in

adult nutrition. Our products are differentiated by

our clinical, science-based approach to innovation

and an expanding focus on specialised nutrition.

Our leading scientists and Key Opinion Leader

partnerships enable us to deliver solutions that are

trusted and respected by parents and healthcare

professionals (HCPs) alike. This is reflected in

Enfa’s position as the leading premium infant

nutrition brand across markets and the number

one paediatrician recommended product in

core markets such as the US and Malaysia, where

infants are able to benefit from the cognitive and

digestive benefits of our science-backed formula.

Similarly, Nutramigen is the number one global

brand for cow’s milk allergy and is the only

productwith 75 years of evidence and

over100published studies.

Our brands lead in premium product

categories globally. Together, they comprise

acomprehensive portfolio designed to meet

theincreasingly specialised needs of every child.

Our Nutrition business is dedicated to

providing the very best science-based

products throughout the stages of life.

Our products are differentiated

byour clinical, science-based

approach to innovation and

anexpanding focus on

specialised nutrition.”

Susan Sholtis

President Nutrition

Infant & Child

Specialty

#1 Globally

Our categories

Category Profile

Geographical Profile

Infant & Child

Specialty

Other

North America

Europe/ANZ

Developing Markets

1. Based on FY23 net revenue

35 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Nutrition continued

Our success is rooted in a team-based approach

to clinical excellence and delivery. For 120

years, our R&D, Medical Affairs and Commercial

Innovation teams have been pioneers in

advancing research and innovation to provide

superior nutrition that nourishes children in the

early stages of their life. Our credible science

has meant we have established high levels of

consumer trust and paediatric recommendation.

This is a position we never take for granted.

We recognise trust needs to be earned every

day and we work relentlessly to meet changing

nutritional needs through a no-compromise

commitment to product quality and food safety.

Our long-term growth opportunity

Our share of the core infant formula market

remains a focus. Yet set against a global trend

of declining birth rates, we see our long-term

growth opportunity in specialised nutrition,

where customisation and premiumisation

provide us with attractive opportunities

forinnovation and product development.

By extending our categories into these white

spaces via nutritional categories like digestion

andallergies, we are driving momentum

andlengthening our growth runways across

ourmarkets.

A science-driven innovator

Our science-as-solutions mindset is the inspiration

behind our formulations that incorporate MFGM,

a critical component in breast milk linked to

long-term brain development (see case study).

Doctors have told us that the science behind

the benefits of MFGM can change healthcare

practice by enabling more infants to receive

benefits from early life nutrition that support

long-term cognitive outcomes. It is differentiated

and important benefits like these that have

Enfamil: building brains,

easingtummies

When choosing an infant formula, promoting

brain health is cited as the number one benefit

looked for by parents. Digestion issues,

meanwhile, are a common problem for infants

and a key reason why parents switch products.

Tackling both challenges head on, we’ve

developed Enfamil formulations with key

nutrients such as MFGM, a naturally occurring

compound found in breast milk, to combine

brain and digestion benefits in a single formula.

Our vision is to establish MFGM as a powerful,

clinically proven ingredient that brings

our formulas closer to breast milk.

Like all of our infant nutrition products,

thedevelopment of our customised MFGM

formulation is science-driven and based

onstate-of-the-art clinical research. This

includes evidence from our most recent study

that showed lasting neurocognitive benefits in

children who had used formulations containing

MFGM during their first year that were still

measurable at five and a half years of age.

By adding MFGM to our superior Gentlease

product, a partially hydrolysed protein (PHP)

based formulation, Enfamil Gentlease Neuro

Pro was able to overcome common digestive

issues that affect an estimated eight out of 10

babies fed on formula in their early years, whilst

also supporting neurodevelopmental benefits.

Launched first in ASEAN and Latin America in

the second quarter of 2023, and introduced

in North America during the fourth quarter,

Enfamil Gentlease Neuro-Pro has met

with a positive consumer response that

has helped us to gain market share.

CASE STUDY

Enfa A+, CS-Biome: protecting

early-year health and wellness

Babies born through caesarean section

could be missing an important step in the

development of their immune system

compared to babies born through vaginal

birth. This is a particular challenge in

Asia where caesarean section births

account for up to 40% of births in nations

like the Philippines and Thailand.

Enfa A+ offers Brain-Immune-Gut (BIG)

health benefits for caesarean section babies

by supporting their microbiome with our

exclusive immune blend, CS-Biome. This

helps to promote optimal immune system

function and offer babies the best start in

life, irrespective of how they were born.

Working closely with HCPs, Enfa A+ has

received acknowledgment for its infant

health benefits, which we have leveraged

to a broader education campaign that

promotes awareness of the importance

of a baby’s microbiome development.

Launched initially in the Philippines in

July 2023, Enfa A+ uses a differentiated

formulation, which we’ve integrated into

our existing manufacturing platform.

CASE STUDY

36 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Market Opportunities: Nutrition continued

Shaping the consumer journey

Whilst prenatal interactions with HCPs play a vital

role in our category, the influence of consumer

research on formula choice is increasing, and

with it the importance of winning in search.

We are expanding the reach and quality of our

digital engagement to capture this opportunity

through content designed to foster consumer

interactions based on truth, accuracy and

trust. AI is set to play an increasingly important

role in this arena by extending our consumer

reach considerably through individualised,

authentic and credible content that helps

us to win in the information journey.

Our mission throughout is to reduce the

complexity of the communication between HCPs

and parents in order to strengthen dialogue.

By bringing both sides closer together through

engaging digital content, we can help to inform

decisions and build confidence in choice.

Achievements and priorities

During 2023 the market environment for infant

formula continued to be influenced by the

prior year infant formula supply shortages in

the US, which resulted from the temporary

closure of a major factory belonging to a

competitor. These past supply shortages have

influenced and resulted in an evolving regulatory

landscape, which we expect to increase both

ongoing compliance costs and our capital

requirement for the infant formula business.

Our US market share is now normalising, following

an extended period of elevated gains as we

increased production in order to help feed

as many infants and children as possible.

Stability in quality supply has been our

uppermost priority throughout. Our teams

worked tirelessly to ensure product availability

was met on retail shelves and in hospitals.

The episode made unprecedented demands on

our manufacturing platform. Our achievements

in helping to overcome a nationwide infant

formula shortage are a testament to the hard

work, ingenuity and dedication of our teams.

Ensuring we maintain the highest levels

of quality and food safety will remain our

overriding priority as we work relentlessly

to sustain the trust we have earned and the

market leadership we are privileged to enjoy.

for details of our 2023 financial performance in Nutrition.

See page 44

led us to extend MFGM’s use to our Digestive

portfolio in brands such as Gentlease.

Elsewhere, we have extended the Enfamil brand

in Asia with the launch of Enfamil CS-Biome.

This supports the development needs that

can arise from childbirth given the greater

occurrence of caesarean section births in the

region, which can impact the development of

ababy’s microbiome and therefore the health of

its immune system (see case study on page 35).

A differentiated go-to-market model

Our infant formula products have a consumer

journey that differs to those in our Hygiene and

Health businesses. Within Nutrition, HCPs play an

integral role in educating parents on child nutrition

and recommending the solutions for their needs.

As channel mediators, HCPs are therefore critical

to our market success, which means building their

awareness and trust alongside that of consumers.

We review the latest clinical research continually to

help improve understanding of how our products

may be used to meet the specialised nutritional

needs of infants and toddlers. We provide a

variety of resources to HCPs, including medical

education, roundtables and the workshops

wefacilitate with world-renowned experts.

Our goal throughout is to foster a collaborative

support environment that is second to none.

The investment we have made in educating

HCPs on the scientific credibility of our products

has resulted in our status as the number one

trusted infant formula in the US; a testament

to the trust we have established throughout

this important stakeholder community.

Keeping children in schools by

increasing access to water in Mexico

Access to clean water and sanitation is one

of four global challenges our products seek

to address. This is a pressing problem in

Mexico, where it is estimated that four out

of 10 schools don’t have water available

every day. In areas with the highest water

stress and high population concentration,

access to water in schools can impact class

hours, student attendance, performance

and overall learning achievement.

We’re working with local communities and the

Agua Capital non-governmental organisation

(NGO) to increase water availability in the areas

surrounding Tlalpan, Atizapan and Chiapas,

the latter being home to cocoa farming

communities that support our Chocomilk brand.

We’re aiming to positively impact the lives of

2.4 million people in vulnerable communities

by generating 116,000 m

of clean water to

keep schools open. So far, we’ve installed

11rainwater harvesting systems at schools

inEstado de México. In 2024, we plan to expand

the reach of this programme to more schools

by partnering with Walmart on a campaign to

install additional rainwater harvesting systems.

Through infrastructure improvements and

education programmes in schools, we are

able to support children’s learning and the

broader community to build a better future.

for more details on our communityinvestments.

See page 53

CASE STUDY

37 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Stakeholders

for our Section 172 Statement.

See page 76

Understanding the needs and

expectations of our stakeholders

isfundamental to our Purpose.

Our business can only grow and prosper by acting

in the long-term interests of our consumers and

customers, our people, our suppliers, our investors

and shareholders, and the communities in which

weoperate.

Our commitment to ‘Do the right thing. Always’

guides us in acting responsibly and with

integrity, puttingpeople first, seeking out new

opportunities, striving for excellence and building

shared success with our stakeholders. For us,

high standards of corporate governance and

incorporating stakeholder voices into our decision-

making are central to maintaining that integrity and

trust, and strengthen our long-term relationships.

for our Section 172 Statement, which explains how the

Directors have discharged their responsibilities during

theyear under review.

See page 76

MAINTAINING THE TRUST

OF OUR STAKEHOLDERS

OUR CONSUMERS

Putting consumers and

people first is a guiding

principle for our business.

Our consumers want products

that are safe, effective and

provide value for money.

Increasingly, they also want

reassurance that the products

they trust are responsibly

sourced, with consideration and

care for the people who make

them and for natural resources

Consumer insight drives

our innovation programme,

helping us to provide trusted,

quality products that help

meet consumers’ hygiene,

health and nutritional needs.

By reaching more people in

more places, we grow our

business and increase our

impact. We do that by gaining

and retaining people’s trust.

How we engage

Group

– We sell around 30 million products every day

and we collect consumer insights through our

sales teams, supply chain partners, customer

and consumer teams. Most of our products are

sold through our retail customers who provide

us with feedback on consumer priorities

(seemore in Customers on the next page)

– Our sensory and consumer science labs

combine this insight and feedback with

behavioural analytics to develop superior

solutions grounded in science

– Through our brands, we work to forge emotional

connections with our consumers by delivering

products and solutions that meet their needs

and reflect their values

Board

– In October 2023, the Board visited the Montvale,

New Jersey R&D facility to learn more about the

consumer-focused approach adopted by the

R&D function

2023 outcomes of engagement

– We are ranked number 24 out of the top 100

consumer packaged goods companies in the

Kantar PowerRanking, which identifies retailers

and suppliers that set the standard of

performance (as rated by trade partners)

– Based on consumer insights, during the year

wedeveloped and launched Finish Ultimate Plus,

Air Wick Vibrant, Nurofen Liquid Capsules and

Lysol Air Sanitiser (read more on pages 28 to 30)

– We continued our multi-year Nurofen ‘See My

Pain’ campaign highlighting the Gender Pain Gap

and launching ‘PAINPASS’, a tool that enables

women to have data-centred conversations

with HCPs

– We simplified the communication between

HCPs and parents through the use of engaging

digital content tailored to the information needs

of each group

– Our Amazon Climate Pledge Friendly products

continued to deliver benefits and outperform

their benchmark by helping our consumers

discover more sustainable products in our

ranges and make choices that align with

theirvalues

38 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Stakeholders continued

How we engage

Group

– Regular global townhalls, hosted by the CEO

andGlobal Executive Committee (GEC),

including live-streamed Q&As plus supporting

market andfunction-specific townhalls

– Annual Global Employee Engagement Survey

– Employee Resource Groups (ERGs) provide

aspace for underrepresented groups of

colleagues to connect and support each

otherand share views with the business

– ‘Always-on’ communication provided through

our intranet, Rubi, supported by Workplace,

amore tailored communication platform for

employees to share updates, insights and news

Board

– Mary Harris, our Designated Non-Executive

Director for Engagement with Company’s

Workforce, maintains regular engagement

withvarious employee groups, including the

Group’s ERGs

– In October 2023, the Board undertook in-person

engagement sessions with US employees at our

Parsippany office

– The Board also receives briefings on the Group’s

annual employee ‘pulse’ survey

2023 outcomes of engagement

– We hosted nine global townhalls during 2023,

including three on strategy, performance and

results, five on wellbeing and allyship, plus our

annual Global Compass Awards. Around 11%

ofemployees attended and/or viewed our

strategy, performance and results updates,

withquestions raised on a range of topics,

including ongoing performance, our CEO’s

priorities and how we are supporting our

DE&Iand sustainability agendas

– A record 87% of employees took part in

ourannual GLINT employee survey, in which:

• 80% ‘believe in and are inspired by our

Purposeto protect, heal and nurture in

thepursuit of a cleaner, healthier world’;

• 82%indicated they are ‘proud to work

atReckitt’, and

• 78% would ‘recommend Reckitt as

anemployer’,3% higher than external

benchmarks and the highest positive

response recorded to this question since

webegan the survey in 2020

OUR PEOPLE

Our colleagues collectively

help fulfil our Purpose to

protect, heal and nurture

inthe pursuit of a cleaner,

healthier world.

We believe in nurturing

aworkplace that supports

and encourages all colleagues

to thrive. The talent, skills,

experience and values

our colleagues bring and

continuously develop

strengthen our organisation.

We engage to build strong

relationships with our people,

ensuring an understanding of

Reckitt’s strategic direction

and the role that every one

of us plays in contributing

to ourcollective success.

In turn, we strive to provide

an inclusive, fulfilling and

high-performing workplace

where everyone has the

freedom to succeed.

for our Section 172 Statement.

See page 76

OUR CUSTOMERS

Our partnerships with

ourretail customers and

distributors are the way

inwhich consumers access

our products.

Aside from the merchandising

opportunities they provide,

retailers also offer us vital

feedback on evolving

consumer priorities and

patterns of demand.

This informs our product

and service innovation

programmes and helps us to

better meet consumers’ needs.

We aim to build strong

and successful customer

relationships and partnerships

founded on common purpose

that ultimately helpus

to grow our business.

In turn, we aim to exceed

our customers’ expectations

through successful innovation,

efficient execution and high-

quality products and service

that help our customers to

grow their own businesses.

How we engage

Group

– We have a Chief Customer Officer for the Group

who is focused on customer engagement,

delivering profitable results and accelerating

sales growth through execution excellence

– Customer relationships are coordinated globally,

regionally or nationally through our customer

service and sales teams. Joint meetings and

workshops are used to define and build shared

objectives, both commercial and non-financial,

agree strategy and action plans, performance

and growth metrics

– We develop joint sustainability business plans

with many of our customers to help deliver

oncollective goals such as plastics and

packaging reduction and emissions avoidance.

Operationally, we provide ongoing support

through our category, shopper, sustainability,

channel and format, and regional specialists

– We seek to identify strategic synergies,

promote purpose-led innovation and invest

inpartnerships and networks that deliver

jointgrowth

Board

– The Board recognises the importance of

understanding our customers. The recent

appointments of Tamara Ingram and

MarybethHays strengthen the Board’s

capabilityin this area

2023 outcomes of engagement

– Our customers rated us top tier in 42% of our

markets in the Advantage Group Survey of

retailers (+260 bps improvement on 2022).

Specifically, Reckitt Hygiene was ranked

numberone for ‘Best E-commerce Supplier’

across all supermarket categories in Australia

– Reckitt won ‘Best Healthcare Partner’ at the

Watsons Singapore Health, Wellness and Beauty

Awards, and Dettol featured as a ‘Must Have’ in

the Boots Thailand Most Loved Beauty Awards

– Drawing upon our relationship with Tesco in the

UK, we worked on consumer behaviour change

initiatives to drive the adoption of refills for our

Dettol surface spray bottle

– Customer Service Excellence Playbook

developed, which drives sustained service

improvement, better customer engagement

and a reduced cost to serve

39 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Stakeholders continued

Board

– The Board receives briefings from the Supply

function on our key supplier relationships,

including in the context of progress against

ourwider supply strategy

2023 outcomes of engagement

– As a member of Manufacture 2030, we are

helping our co-packers to improve their

environmental performance, specifically

emissions reduction and water use

– In partnership with Oxfam Business Advisory

Service, we created a practical toolkit to help

suppliers develop and implement site-level

grievance mechanisms. The toolkit was piloted

with suppliers in India, Pakistan, China, Peru

andthe UK across the manufacturing and

agricultural sectors

– We updated our Supplier Balanced Scorecard

tofacilitate more granularity on sustainability

performance, allowing us to review

performance and action plans twice a year

– We incorporated sustainability metrics into

ourSupplier Vulnerability Tool, a framework

used to assess supply risk data (including

sustainability metrics)

– TheFinance Directors of Hygiene and Health

participated in investor conferences during

theyear

– Our Global Head of Sustainability participated

ina number of ESG investment panels as a

speaker on biodiversity, in addition to hosting

abiodiversity webinar in partnership with the

publisher Responsible Investor and supporting

the launch of the Taskforce on Nature-related

Financial Disclosures (TNFD) framework

– Our Chair hosted meetings with key investors to

discuss the appointment of Kris Licht as new CEO

2023 outcomes of engagement

– Following extensive outreach to investors by

ournew CEO Kris Licht, through one-on-one

meetings and attendance at leading bank

conferences, we updated the market with

ourStrategic Update alongside our Q3 results

– We reinforced our strategic message:

wearefocused on the continuity of our

strategy, delivering consistent execution

anddriving sustained value creation

How we engage

Group

– We host regional supplier capability-building

events in partnership with industry peers, where

local suppliers are invited to attend and share

best practice on salient topics

– We have centralised more supplier relationships

and procurement activity to monitor supplier

performance and enable best practice sharing

– We conduct regular supplier audits based

onpast performance and risk. Where needed,

we work with suppliers through our capability

building programme to help improve processes

and raise standards

– We engage with HCPs internationally to

exchange information, share best clinical

practice and sponsor research. We also

contribute our expertise to professional journals,

international symposiums and congresses

– We collaborate with independent, purpose-

driven entrepreneurs whose objectives

complement our own

How we engage

Group and Board

– We communicate our financial results through

webinars and management presentations

toanalysts and institutional investors

– We communicate our financial results at our

Annual General Meeting to retail investors

– Post results, the CEO and CFO attend

roadshows to meet with top shareholders

andprospective investors to discuss our latest

financial performance and address any relevant

associated topics

– Management and the Investor Relations team

attend investor conferences throughout the

year to communicate key messages from our

most recent financial results and reiterate our

company strategy

– We hold ad hoc meetings with investors and

sell-side analysts to address any strategy,

operational, Environmental, Social and

Governance (ESG) and modelling queries

– We host a number of additional investor

engagement events, including investor dinners,

sales desks and credit investor updates

OUR SUPPLIERS

AND PARTNERS

Maintaining long-term

relationships with suppliers

and partners helps us to

protect business continuity,

drive innovation and deliver

our Sustainability Ambitions.

OUR INVESTORS

Investors provide financial

capital in the form of equity

and debt, which underpins our

business and enables us to

execute our strategy. In return,

investors expect attractive

returns through capital

appreciation, dividends,

sharebuybacks or interest.

Ensuring our supplier

relationships are founded

on high standards helps us

to drive progress across the

value chain. From ensuring

the fair treatment of workers,

to reducing carbon emissions

and water use, and protecting

local ecosystems and nature,

our engagement is helping to

Our investment community

includes current shareholders

and prospective investors,

mainly institutional and

retail, as well as sell-side

research analysts, investment

and financing banks and

ratings agencies. Many of

our employees form part of

this shareholder community,

being shareholders also.

build resilience and maximise

opportunities for all.

Insights from across the value

chain help us to understand

long-term trends, build

action programmes, guide

innovation and develop

expertise and capabilities

to meet future challenges in

partnership with our suppliers.

Our Investor Relations

programme promotes an open,

consistent and transparent

dialogue, with the aim of

informing investors and

market participants of our

key attributes and strategy.

for our Section 172 Statement.

See page 76

40 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

How we engage

Group

– Together with our partners, we use our

expertise and global reach to drive measurable

and sustainable impact in communities aligned

with our commitment to a cleaner, healthier

world and our focus on achieving a fairer

society, while advancing the UN Sustainable

Development Goals

– We accelerate social entrepreneurship with

expert partners, including Yunus Social Business

and Health Innovation Exchange, by mentoring,

funding and scaling these businesses

– We leverage innovative finance and impact

investments like Water Equity’s Fund IV and

Watercredit micro-finance loans to help provide

lasting access to clean water and sanitation

– We drive behaviour change at scale through our

leading brands; for example, through Dettol’s

Hygiene Quest, a gamified school programme

that educates millions of students each year

– We work with suppliers and communities in

oursupply network through partners such as

Earthworm Foundation, to manage our supply

networks, promote sustainable livelihoods,

andprotect local ecosystems and habitats

Board

– Through the Corporate Responsibility,

Sustainability, Ethics and Compliance (CRSEC)

Committee, the Board is kept updated on and

monitors our Fight for Access Fund and other

social impact initiatives

2023 outcomes of engagement

– Enabling access to hygiene education is a key

focus for our Dettol, Lysol, Harpic and Napisan

brands. Our global hygiene campaigns have

brought high-quality hygiene education to

35million people in over 7 countries and

reduced absenteeism in schools

– We launched the ‘Empowering our Youth’

strategic partnership with the United Nations

Population Fund (UNFPA) to empower women and

young people on sexual and reproductive health

– In collaboration with local partners, through

commercial incentives and investment in

training and capacity building, rubber farmers in

our latex supply chain have reduced their costs,

built resilience and improved their incomes,

leading to wider community benefits

for our Social Performance Review.

See page 52

Board

– To coincide with the first ever Health Day at

COP28, the Board held a Listening Session on

the impacts of climate change on global health.

Experts from the London School of Hygiene

andTropical Medicine (LSHTM) provided

theBoard with a strategic overview of the

associated health issues. The session also

assessed the topic from the perspective of

thecommunities Reckitt serves; in particular,

the health challenges of water scarcity in Mexico

and thespread of vector-borne diseases in India

2023 outcomes of engagement

– With our partners, we emphasised the impact

ofclimate change on health and collectively

secured the first ever Health Day at COP28,

nowpart of the COP agenda

– Reckitt’s long-term collaboration with LSHTM

has advanced hygiene best practices

– Our ‘Oh Yes! Net Zero’ campaign, which aims to

make Hull net zero, now has 175 local companies

from the region, both large and small, signed up

as members

How we engage

Group

– We engage with governments and national

regulators, including the FDA in the US, through

formal policy consultation processes and

informally through bilateral engagement

atformal public-private forums, such as

theUnitedNations COP28 and Water Week

– With NGOs: through global partnership

programmes with Water.org and our WWF

partnership, and through local supply chain

partnerships such as with Earthworm Foundation

– With industry peers: through trade associations

including the International Association for Soaps,

Detergents and Maintenance products (AISE),

via the World Business Council for Sustainable

Development (WBCSD) and the Consumer

Goods Forum (CGF), and through partnerships

such as the Climate & Health Coalition,

facilitated by independent partners

– We work with the Nature-based Insetting team,

a spin-off from the University of Oxford, to help

us understand and measure our impact on

biodiversity in key supply chains, and the

University of York on PhDs to support green

chemistry and product resilience

Our Stakeholders continued

COMMUNITIES

From the markets we support

with our products to those

atthe heart of where we

operate and source our

ingredients, the communities

across our value chain, are

critical to our goal to make

apositive impact.

GOVERNMENTS,

NGOS, INDUSTRY

AND ACADEMIA

We engage with public

policymakers to protect

andstrengthen our reputation

andinfluence policy and

regulatory development.

Our community focus is linked

to our Purpose and areas

where we can make the

biggest impact: access to clean

water, hygiene and sanitation

for all; championing sexual

and reproductive healthcare

and rights; strengthening

maternal and child healthcare;

and improving access to

healthcare and self-care.

We also work with civil

society and NGOs on areas

of common interest to

identify opportunities where

collective action canmake

an impact at scale.

We work with universities

and industry groups to

support new innovation

andprocess development.

With engaged and empowered

communities, we benefit from

long-term market growth

and resilient supply chains,

while advancing access to

the highest-quality hygiene,

wellness and nourishment.

In turn, these forums provide

valuable research, insights and

feedback to further strengthen

our approach and help shape

wider industry action.

for our Section 172 Statement.

See page 76

41 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Financial Performance

Group net revenue of £14,607 million grew by

+3.5% on a LFL basis in the year, reflecting price /

mix improvements of +7.8% and a volume decline

of -4.3%. Our Hygiene brands delivered broad-

based growth (+5.1%) across our brand portfolio

with improving volume trends throughout the

year. Health growth (+5.0%) was led by our

OTC and Intimate Wellness portfolios, and

Nutrition declined (-4.0%) as the US lapped

the prior year competitor supply issue.

Total net revenue on an IFRS basis was up

+1.1%, reflecting net M&A impact of -0.3%

and foreign exchange headwinds of -2.1%.

44% of our Core Category Market Units (CMUs) held

or gained share, with 47% in Hygiene, 46% in Health

and 37% in Nutrition (weighted by net revenue).

E-commerce net revenue grew by +9% in 2023

and now accounts for 15% of Group net revenue.

Adjusted gross margin was 60.0% (2022: 57.8%),

an increase of +220bps, driven by pricing and

productivity efficiencies – predominantly

across revenue growth management and

procurement. These levers more than offset

inflation of mid-single digits in the year.

Brand equity investment (BEI) increased by +13.2%

(+£0.2 billion) on a constant FX basis as we invest

behind innovation launches and the long-term

strength of our brands. BEI percentage of net

revenue was up +130bps to 13.1% (2022: 11.8%).

A YEAR OF

PROGRESS WITH

MID-SINGLE-DIGIT

GROWTH FOR

HEALTH AND

HYGIENE

We grew net revenue,

increased free cash

flow and reduced

leverage, enabling

ustodeliver greater

returns toshareholders.”

Jeff Carr

Chief Financial Officer

Adjusted operating profit was £3,373 million

(2022: £3,439 million) at an adjusted operating

margin of 23.1% (2022: 23.8%), -70bps lower

than prior year, with gross margin expansion

offset by increased brand equity investments

and inflation-led cost base increases. When

excluding the one-off benefits of circa 80bps

in 2022 related to US Nutrition, adjusted

operating profit margin grew +10 bps.

IFRS operating profit was £2,531 million

(2022:£3,249 million) at an operating profit margin

of 17.3% (2022: 22.5%). This was impacted by the

IFCN goodwill impairment of £810 million (2022: £nil),

reflecting higher interest rates and changes in the

regulatory environment.

Total adjusted diluted EPS was 323.4p in 2023

(2022: 341.7p), -5.4% below 2022 as higher adjusted

operating profit at constant exchange rates was

more than offset by adverse foreign exchange

and a higher adjusted effective tax rate in 2023.

Total IFRS diluted EPS was 228.7p (2022: 324.7p).

Full year dividend increased by 5% to 192.5p

(2022:183.3p) per share, in line with our policy

todeliver sustainable dividend growth. Thefinal

proposed dividend is 115.9p (2022: 110.3p) per share.

Free cash flow was £2,258 million in 2023

(2022:£2,031 million) a +11% increase year on year

driven by an improvement in net working capital.

Net debt ended the year 1.9x adjusted EBITDA

(2022: 2.1x adjusted EBITDA).

Net Revenue

£14.6bn

£14.5bn as of 2022

Adjusted Operating Profit

£3.4bn

£3.4bn as of 2022

Free Cash Flow

£2.3bn

£2.0bn as of 2022

42 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Financial Performance continued

HYGIENE

Within Auto Dish, our market leading brand

Finish, grew low-double digits LFL net

revenue and grew market share driven by the

successful launch of our new super premium

tier, Finish Ultimate Plus All-in-One, delivering

more superior solutions to consumers and

driving premiumisation in the category.

Lysol returned to growth in the year driven by

strengthened brand equity and the broadening

of the brand’s shoulders with continued

strong growth in Laundry Sanitiser expanding

household penetration and the recent creation

of the Air Sanitisation category with the

launch of Lysol Air Sanitisers in the US, the

first and only antimicrobial product approved

by the EPA that kills 99.9% of airborne viruses

and bacteria while eliminating odours.

Adjusted operating profit for Hygiene at

£1,236million was up +4.7% on a constant FX basis

and +1.8% on an actual basis. Adjusted operating

profit margin was 20.1%, down -30bps. Strong

gross margin expansion was offset by increased

investment behind innovation launches and brand

building initiatives, and inflation-led fixed costs.

Hygiene net revenue grew +5.1% on a LFL basis

to £6,135 million for the full year. Innovation-led

pricing and favourable mix (price / mix +11.1%) were

the key drivers partially offset by volume decline

of 6%. Importantly, our volume trend substantially

improved quarter by quarter throughout the year.

Net revenue growth was broad-based across all

major brands delivering positive LFL net revenue

growth and total Hygiene market share momentum

improving in Q4 driven by continued momentum

in Auto Dish (Finish). We successfully launched

innovations in most categories that improved

consumer delight, delivered more premium

solutions for our consumers and grew penetration,

in line with our category growth strategy.

47% of Core Hygiene CMUs (weighted by net

revenue) gained or held share during the year.

Volume -6.0%

Price/Mix +11.1%

LFL

+5.1%

Net M&A –

FX -2.2%

Actual +2.9%

FY 2023 Net Revenue

£6,135m

Adjusted Operating Profit

£1,236m

Adjusted Operating Profit Margin

20.1%

Constant FX (CER)

+4.7%

Actual +1.8%

Actual -30bps

1. Adjusted measures are defined on page 223

42%

of Group net revenue

43 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Financial Performance continued

HEALTH

cold & flu season in Q4 2022. Mucinex added a

new medicated throat spray to its InstaSoothe

product range, further extending its presence

in the $1 billion US sore throat market.

Intimate Wellness delivered high single-digit

growth in the year. Growth was broad-based

across Europe, following the rebranding of

the product range during 2022. Our portfolio

in China benefited from the end of COVID-

related lockdowns and innovation, including

Durex Fetherlite, our new hyaluronic acid

condom with water-based lubricant providing

a natural moisturisation experience. Growth

was also strong across LATAM, and India

where we increased total distribution points

share during the year by around +400bps.

Dettol declined mid-single digits in the year, with

a mixed performance across markets. A number

of markets delivered growth and market share

gains, underpinned by innovations, including an

extension of Dettol Cool in India, Dettol Washing

Machine Cleaner and Dettol Laundry Pods in China.

However, growth was offset by declines in ASEAN

due to category weakness and specific in-market

challenges. The actions taken during the second

half of the year to address these challenges

have driven an improved performance in Q4.

Adjusted operating profit for Health at

£1,690million was up +6.3% on a constant FX

basis and +2.5% on an actual basis. Adjusted

operating margin was 27.9%, an increase of

+40bps, with gross margin expansion more than

offsetting increased investment behind our

brands and inflation-led fixed cost increases.

Health net revenue grew +5.0% on a LFL basis to

£6,062 million for the full year. This reflected price /

mix improvements of +5.3% and volume decline

of-0.3%.

46% of Core Health CMUs (weighted by net

revenue) gained or held share during the year.

Our OTC portfolio grew low-double digits on a LFL

net revenue basis behind a combination of both

volume and price / mix growth. Nurofen, Strepsils,

Gaviscon and Biofreeze all grew-double digits,

driven by innovation launches, premiumisation

and pricing actions, brand whitespace expansion

(Biofreeze Overnight Relief in the US and Nurofen

Liquid caps into a number of European markets),

as well as some retailer inventory rebuilding in

Europe in Q1. Mucinex delivered low-single-digit

growth which laps a very strong and earlier

FY 2023 Net Revenue

£6,062m

Adjusted Operating Profit

£1,690m

Adjusted Operating Profit Margin

27.9%

Volume -0.3%

Price/Mix +5.3%

LFL

+5.0%

Net M&A -0.6%

FX -3.2%

Actual +1.2%

Constant FX (CER)

+6.3%

Actual +2.5%

Actual +40bps

1. Adjusted measures are defined on page 223

42%

of Group net revenue

44 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Financial Performance continued

NUTRITION

value market share position in the non-WIC stage

1-3 segments where we operate. Our Enfamil

brand remain the number one recommended

infant formula by paediatricians in the US.

Our Developing Markets business declined

mid-single digits with category-led volume

declines partially offset by premiumisation and

growth in both the specialty and adult segments.

Areduction in our transitional service arrangement

(TSA) contract manufacturing volume relating

to our disposed China business, contributed

around 60bps to the year-on-year decline.

LATAM grew mid-single digits, offset by market

challenges across certain ASEAN markets.

Adjusted operating profit for Nutrition at

£447million was down -22.4% on a constant

FX basis and -22.5% on an actual basis.

Adjusted operating margin was 18.5%, down

-460bps, reflecting the year-on-year volume

deleverage as we lap the competitor supply

issue in the US, and negative mix as we lose the

benefit from WIC sales in states where Reckitt

does not hold the government contract.

Product liability claims have been filed against

the Group’s Nutrition business relating to

Necrotizing Enterocolitis (NEC). More details on

this matter are included in Note 20 on page 190.

Nutrition net revenue declined -4.0% on a LFL basis

to £2,410 million for the full year. Volume declined

-10.0% due to the lapping of peak market shares

in the US from the competitor supply shortage in

the prior year and category-led volume declines

in LATAM and ASEAN. Price / mix improvements

were +6.0% with pricing actions partially offset

by more normalised trade conditions in the US.

37% of Core Nutrition CMUs (weighted by net

revenue) gained or held share during the year.

IFCN US net revenue declined high-single digits

on a LFL basis in the year with non-WIC market

shares rebasing during the second half as we lap

the prior year competitor supply issue. Throughout

the year, we maintained our leading volume and

FY 2023 Net Revenue

£2,410m

Adjusted Operating Profit

£447m

Adjusted Operating Profit Margin

18.5%

Volume -10.0%

Price/Mix +6.0%

LFL

-4.0%

Net M&A -0.1%

FX +0.5%

Actual -3.6%

Constant FX (CER)

-22.4%

Actual -22.5%

Actual -460bps

1. Adjusted measures are defined on page 223

16%

of Group net revenue

45 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Financial Performance continued

Discontinued operations

The Group recognised a profit from discontinued operations of £9 million (2022: £7 million loss),

inrelationto the Group’s disposal of the RB Pharmaceuticals business (now Indivior plc).

Earnings per share (EPS)

Adjusted diluted EPS was 323.4 pence (2022: 341.7 pence), a decrease of 5.4% as higher adjusted

operating profit at constant exchange rates was more than offset by adverse foreign exchange

andahigher adjusted ETR in 2023.

IFRS diluted EPS was 228.7 pence (2022: 324.7 pence).

Balance sheet

At 31 December 2023, the Group had total equity of £8,469 million (31 December 2022: £9,483 million).

Current assets of £5,302 million (31 December 2022: £5,285 million) increased by £17 million as lower

inventories and lower corporation tax receivables were offset by higher cash and cash equivalents

andhigher assets held for sale.

Current liabilities of £8,338 million (31 December 2022: £8,341 million) decreased by £3 million. The decrease

principally relates to lower trade and other payables, together with lower current tax liabilities and current

provisions. These decreases were offset by the share repurchase liability in relation to committed

purchases under the share buy-back programme.

Non-current assets of £21,834 million (31 December 2022: £23,457 million) primarily comprise goodwill

and other intangible assets of £18,588 million (31 December 2022: £20,203 million) and property, plant

and equipment. The decrease in goodwill and other intangible assets of £1,615 million is predominantly

due to the strengthening of sterling reducing the value of foreign currency denominated assets and

theimpairment of IFCN goodwill.

Non-current liabilities of £10,329 million (31 December 2022: £10,918 million) decreased by

£589millionprincipally due to the strengthening of sterling reducing the value of foreign currency

denominated liabilities.

Net working capital

During the year, net working capital decreased by £56 million to negative £1,479 million. Net working

capital as a percentage of 12-month net revenue is -10% (31 December 2022: -11%) mainly due to lower

trade payables and lower inventories.

The following section should be read in conjunction with the full-year financial review from page 41

andthe alternative performance measures section from page 223.

Group operating profit

Adjusted operating profit was £3,373 million (2022: £3,439 million) at an adjusted operating margin of

23.1%, 70bps lower than the prior year (2022: 23.8%). Excluding the one off benefit of c.80bps in 2022

relating to US Nutrition, adjusted operating margin was 10bps higher than 2022. This increase was driven

by higher gross margins, 220bps higher than 2022 from productivity efficiencies and pricing. This gross

margin leverage was offset by higher BEI, 130bps higher than 2022 as we have invested behind our

innovation launches and the long-term strength of our brands, and higher fixed costs, 160bps higher than

2022 due to inflation led cost base increases. Adjusted operating profit in both 2023 and 2022 included

the favourable effect of adjustments to trade spend and operational accruals, certain of which were

subject to significant estimation uncertainty when initially recorded.

Late in the year end close process we identified, through our ongoing compliance procedures,

anunderstatement of trade spend in two Middle Eastern markets related to the fourth quarter and

priorquarters of 2023. As a result, full year net revenue was £55 million lower than previously expected

whichis fully reflected in the FY 2023 results (adjusted operating profit impact of £35 million).

IFRS operating profit was £2,531 million (2022: £3,249 million) at an IFRS operating margin of 17.3%

(2022:22.5%). IFRS operating profit in 2023 was impacted by a goodwill impairment charge of £810 million

relating to IFCN (2022: £Nil), reflecting higher interest rates and changes in the regulatory environment,

(see Note 9). IFRS operating profit in 2022 was impacted by a charge of £152 million from impairment

ofgoodwill relating to the acquisition of Biofreeze.

Net finance expense

Adjusted net finance expense was £247 million (2022: £256 million). Adjusted net finance expense

in2023 benefited from foreign exchange gains on certain financing liabilities (compared with losses

in2022), which offset the effect of higher interest rates in 2023 as compared to 2022.

IFRS net finance expense was £130 million (2022: £161 million). The lower net finance expense under

IFRSis principally due to £130 million of translational foreign exchange gains resulting from the liquidation

of a number of subsidiaries to simplify the Group’s legal entity structure (2022: £69 million).

Tax

The adjusted effective tax rate (ETR) was 25.2% (2022: 21.9%). The 2022 ETR benefited from a higher level

of reassessment of uncertain tax positions following progress on and conclusions of tax authority audits.

The IFRS tax rate was 31.4% (2022: 23.2%). The IFRS ETR in 2023 is higher than the adjusted ETR due to

thenon-deductible impairment of IFCN goodwill offset by the benefit from largely non-taxable gains on

liquidation of subsidiaries. The IFRS ETR in 2022 benefited from a higher level of reassessment of uncertain

tax positions following progress on and conclusions of tax authority audits, and largely non-taxable gains

on sale of E45 and foreign exchange gains on liquidation of subsidiaries.

46 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Financial Performance continued

At 31 December 2023, net debt was £7,290 million, a decrease of £694 million from 31 December 2022,

ascontinued strong free cash flow was used to pay down debt and enabled higher capital returns through

dividends (£1,339 million) and the new share buy-back program (£207 million). Net debt was 1.9x adjusted

EBITDA at 31 December 2023 (31 December 2022: 2.1x).

The Group regularly reviews its banking arrangements and currently has adequate facilities available to it.

The Group has committed borrowing facilities totalling £4,500 million (31 December 2022: £4,500 million),

£4,450 million of which expire after more than two years, which are undrawn at year end. The Group

remains compliant with its banking covenants. The committed borrowing facilities, together with cash

and cash equivalents, are considered sufficient to meet the Group’s projected cash requirements.

Dividends

The Board of Directors recommends a final 2023 dividend of 115.9 pence (2022: 110.3 pence). The

ex-dividend date will be 11 April 2024 and the dividend will be paid on 24 May 2024 to shareholders on

the register at the record date of 12 April 2024. The final 2023 dividend will be accrued once approved

byshareholders.

Return on Capital Employed (ROCE)

ROCE in 2023 was 12.5% (2022: 13.2%), a decrease of 70bps from 2022, due to a lower Net Operating

Profit after Tax (NOPAT) as a result of the higher adjusted tax rate.

Capital returns policy

Reckitt has consistently communicated its intention to use its strong cash flow for the benefit of

shareholders. Our priority remains to reinvest our financial resources back into the business, including

through value-adding acquisitions, in order to deliver sustainable growth in net revenue and improving

earnings per share over time.

In managing the balance sheet, we intend to maintain key financial ratios in line with those expected of

an A-grade credit-rated business. This will broadly define acceptable levels of leverage over time. As we

reduce leverage we will return surplus cash to shareholders as appropriate. In October 2023, our strong

free cash flow generation and healthy balance sheet enabled us to announce a £1 billion share buy-back

programme over the following twelve months.

Growing the dividend is a long-term goal of the business. The Board’s dividend policy aims to deliver

sustainable dividend growth in future years, subject to any significant internal or external factors.

Accordingly, the 2023 dividend was increased by 5% in line with this objective.

Cash flow

31 Dec 2023

£m

31 Dec 2022

£m

Adjusted operating profit 3,373 3,439

Depreciation, share-based payments and gain on disposal of fixed assets

(net of proceeds) 585 521

Capital expenditure (449) (443)

Movement in working capital and provisions (21) (408)

Cash flow in relation to adjusting items (45) (38)

Interest paid (263) (209)

Tax paid (922) (831)

Free cash flow 2,258 2,031

Free cash flow conversion 97% 83%

Free cash flow (FCF) is the amount of cash generated from continuing operating activities after net

capital expenditure on property, plant and equipment and intangible software assets. Free cash flow

reflects cash flows that could be used for payment of dividends, repayment of debt or to fund

acquisitions or other strategic objectives.

Free cash flow of £2,258 million increased by £227 million or 11%. Free cash flow conversion improved

by14 percentage points to 97% as the benefit from working capital was only partially offset by higher

taxand interest paid.

Net cash generated from operating activities has increased by £239 million to £2,636 million

(2022: £2,397 million).

Net debt

31 Dec 2023

£m

31 Dec 2022

£m

Opening net debt (7,984) (8,378)

Free cash flow 2,258 2,031

Share buyback (207) –

Purchase of ordinary shares by employee share ownership trust (2) –

Shares reissued 48 54

Acquisitions, disposals and purchase of investments (80) 220

Dividends paid to owners of the parent company (1,339) (1,249)

Dividends paid to non-controlling interests (8) (35)

New lease liabilities in the period (44) (134)

Exchange and other movements 76 (500)

Cash flow attributable to discontinued operations (8) 7

Closing net debt (7,290) (7,984)

47 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review

Our 2030 Sustainability Ambitions

arean integral part of our business

strategy and support long-term

resilience and growth. They act to

bring ourPurpose to life: to protect,

heal and nurture in the pursuit

ofacleaner, healthierworld.

Our sustainability activity is focused on three

pillars of activity: innovating Purpose-led brands,

enabling a Healthier Planet and contributing

to a Fairer Society. These focus our work on

delivering a cleaner, healthier world whilst

contributing to our business resilience and

growth. Our approach aims to create impact

for society and impact for our business.

Our business and brands help solve some of

the world’s biggest challenges. Our portfolio

is uniquely placed to support hygiene as a

foundation for health, to enable self-care, support

sexual health and wellbeing, and nutrition at all

stages of life. Each of our brands contribute to

the UN Sustainable Development Goals (SDGs)

and create impact through their innovation

programmes and consumer engagement

activities that support change in the home.

Collectively, the positive social and environmental

impacts we create help advance the broader aims

of the UN SDGs. Whilst we contribute to many of

the goals, we believe we can make the biggest

impact on five that are most closely connected

to our brands and our social impact partnerships:

Focusing on what’s material

During the year, we reviewed our approach to

double materiality against the requirements of the

EU Corporate Sustainability Reporting Directive

(CSRD) and the latest guidance from the European

Financial Reporting Advisory Group (EFRAG).

This, along with external research, benchmarking

and input from key stakeholders, has formed

the basis of our updated double materiality

assessment, the details of which we will disclose

in our 2024 Annual Report and Accounts.

DELIVERING OUR

SUSTAINABILITY AMBITIONS

PURPOSE-LED BRANDS

for our Sustainability Ambitions progress overview.

See page 14

We are increasingly aware of the connection

between planetary and public health,

socioeconomic resilience and shared

prosperity. Enabling andstrengthening

hygiene, health and nutrition, together with

safeguarding the planet, are critical toour

business resilience and long-term success.

More sustainable products

Our portfolio of brands help solve everyday

problems and do so at scale, with around 30million

products sold around the world every day.

We are committed to ensuring sustainability is front

and centre of our brands’ purpose and product

innovation whilst maintaining superior efficacy.

This is reflected in our ambition to achieve 50% net

revenue from more sustainable products by 2030.

Alongside this, we are also aiming to achieve:

– 50% reduction in our product carbon footprint

by 2030 versus 2015

– 50% reduction in product water footprint

by2040 versus 2015

– 50% reduction of virgin plastic in packaging

by2030 versus 2020

Our Sustainable Innovation Calculator,

astreamlined product lifecycle assessment

tool, evaluates the environmental impacts of

our products by measuring five metrics: Carbon,

Water, Plastics, Packaging, Ingredients and

Chemistry. The outputs from the calculator

areused to guide decision-making at a project

level, enabling our product developers to make

informed decisions on sustainability indicators,

aligned with delivering our commitments.

In 2023, we have seen a marked improvement

insales from more sustainable products, with

29.6% of net revenue generated from these as

measured by our Sustainable Innovation Calculator,

an uplift from 24.4% in 2022. Thisimprovement

reflects more sustainable innovations reaching

themarketplace, and better use of our Calculator

onnew and existing product development

acrossall GBUs.

for more about our brand innovations.

See pages 15-18

for more about our Scientific Innovation

programmeandoutcomes.

See pages 22-24

48 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review continued

HEALTHIER PLANET

for our Sustainability Ambitions progress overview.

See page 14

Net zero across our value chain

We have a holistic set of science-based targets

tohelp tackle climate change and achieve

netzeroby 2040:

– Reduce our product carbon footprint by 50%

by2030 versus 2015

– Reduce our absolute Scope 1 and 2 GHG emissions

by 65% by 2030 versus 2015

– Achieve 100% renewable electricity by 2030

Emissions reduction and energy use

Our product carbon footprint includes emissions

across the whole value chain (Scopes 1, 2 and

selected Scope 3). During 2023, we improved the

stability of our model, enhancing the methodology

and strengthening the approach. This process

has resulted in our 2015 baseline being restated

at 10.6 million tCO₂e (previously 11.1 million tCO₂e).

Using the updated methodology, our 2023 product

carbon footprint was 9.1 million tCO₂e, a 13.5%

reduction on our 2015 baseline. Further information

on this is available in our Basis of Reporting

Criteria at www.reckitt.com/reporting-hub.

Our approach to reducing our Scope 3 emissions

is to focus on the largest emitting categories. Raw

materials and packaging account for over half of our

carbon footprint and 25 key raw materials comprise

80% of our ingredients footprint. We have begun

working with our suppliers to reduce the carbon

emissions associated with these categories. In some

cases, we will switch to low carbon alternatives

and our R&D team is evaluating options for this

while maintaining the safety and efficacy of our

products. Downstream logistics makes up another

significant proportion of our footprint and we are

evaluating low carbon road- and sea-freight options.

In our operations, we continue to meet and

exceed our target to reduce emissions from our

manufacturing and warehousing operations,

achieving a 67% reduction in Scope 1 and 2

emissions against our baseline. We have developed

plans and targets for carbon reduction across

our manufacturing sites which are reviewed

monthly by our Supply Chain Leadership

team. Specifically, we focus on optimising

high carbon manufacturing processes and

exploring options for asset replacement.

We source renewable electricity and are evaluating

alternative options and replacements for our

thermal energy needs. 94% of the electricity

purchased and consumed by our sites is renewable

through a combination of on-site generation and

renewable energy certificates. We are progressively

implementing power purchase agreements (PPA)

toreduce the use of renewable energy certificates.

In partnership with Manufacture 2030, we continued

to work with our contract manufacturers through

our Supplier Environmental Performance programme

to measure, track and help progressively reduce

their emissions. This included the launch of the

‘FMCG Vertical’ campaign in March 2023, where

we, along with other peer companies, promoted

shared data provision and action planning. This

simplifies environmental performance activity for

both the suppliers involved and their customers.

for more detailed emissions and energy data and the

methodologies used to calculate this information.

See our ESG data book

for our Climate-related Financial Disclosures and

TCFDstatement.

See pages 218-222

Emissions information¹

Metric Unit 2023

2022

(restated)* 2022

Scope 1 emissions tCO

e 115,705+ 121,467 121,275

Scope 2 emissions (market-based) tCO

e 8,902+ 9,450 9,448

Scope 2 emissions (location-based) tCO

e 241,600+ 241,968 237,471

Total Scope 1 and 2 emissions (market-based) tCO

e 124,606 130,917 130,723

Total Scope 1 and 2 emissions (location-based) tCO

e 357, 304 363,435 358,746

Scope 3 emissions (excluding indirect consumer use) million tCO

e 9.2 9.5 13.0

Scope 3 emissions (including indirect consumer use) million tCO

e 37.6 36.7 40.0

Total product carbon footprint

(excluding indirect consumer use)

million tCO

e 9.1+ 9.5 13.0

Total product carbon footprint

(including indirect consumer use)

million tCO

e 37.3+ 36.7 40.0

Scope 1 and 2 GHG emissions intensity (market-based)

– tCO

e per tonne of production

0.04 0.04 0.04

– tCO

e/£m revenue 0.008 0.009 0.009

Energy consumption resulting in

Scope 1 and 2 emissions MWh 1,220,968+ 1,278,934 1,278,643

Proportion of energy consumption from UK operations % 10 11 11

Proportion of Scope 1 and 2 emissions from

UKoperations % 12 11 11

+ Assured by ERM CVS as part of limited assurance engagement in accordance with International Standard on Assurance

Engagement ISAE 3000 (revised) and ISAE 3410 for Greenhouse Gas data issued by the International Auditing and Assurance

Standards Board. The assurance report, along with the principles and methodologies we use in our reporting, can be found

online at www.reckitt.com/reporting-hub

1. We report on emission sources required under the Companies Act 2006 (Strategic Report and Directors’ Reports)

Regulations2013 and the Streamlined Energy and Carbon Reporting (SECR) requirements covering the 2023 reporting year

(1 January–31 December). Emissions have been calculated in line with the World Resources Institute (WRI)/World Business

Council for Sustainable Development (WBCSD)Greenhouse Gas (GHG) Protocol – Corporate Accounting and Reporting

(revisededition). Our GHG emissions and energy data includes emissions and energy consumption from operations covered

bythe Group Financial Statements for which we have operational control

2. Our total product carbon footprint includes Scope 1, 2 and selected Scope 3 emissions.

3. The scope of our GHG emissions per tonne of production covers manufacturing and warehousing. Including R&D and offices

the GHG emissions intensity per unit of production in 2023 sites only was 0.04 tCO

* Restatements: prior year Scope 1 and 2 data has been restated as a result of site divestments, and updates to local energy

conversion factors and the International Energy Agency GHG emission factors. Prior year Scope 3 data has been restated

asaresult of methodology improvements

Full details on the calculation methodologies are available in our Basis of Reporting Criteria online at www. reckitt.com/reporting-hub.

Foundation

Industries emit

valuable CO

captured

is converted into key

intermediates used widely in

the chemical industry

Intermediates

converted into

surfactants

Surfactants are

formulated into cleaning

products and coatings.

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review continued

Energy efficiency measures

When we set our science-based targets for

emissions reduction in 2020, improving our

energy efficiency was an important step in

delivering a 65% carbon reduction. Since then,

changes to our business structure and product

mix alongside ensuring our purchased electricity

is from renewable sources, has reduced the

significance of energy efficiency on our carbon

emissions. We remain focused on energy efficiency

improvements for cost purposes, but the original

target is no longer as relevant for decarbonisation.

Instead, we are targeting gas efficiency and

alternative thermal energy to reduce emissions.

As a result, progress towards our energy efficiency

target has slowed and this year we reduced

energy use per tonne of production by 4% against

our baseline. We are still aiming to improve energy

efficiency, with its associated reduction in energy

costs, but with many projects having longer

pay-back periods, absolute carbon reduction will

remain the focus of our attention.

Plastics and packaging

By 2030, we plan to halve our use of virgin plastic.

Our ambition is for all our plastic packaging to

be recyclable or reusable by 2025, with at least

a quarter coming from recycled materials.

During the year, we reviewed our Post-Consumer

Recycled (PCR) plastic inclusion rates against

our targets and planned activity. Progress to

date is slower than anticipated at 5%. To help

accelerate the inclusion of more PCR in our

packaging, the GEC approved an additional

financial commitment. This will support our work

to increase PCR across many of our Hygiene and

Health brands, focused on key packaging formats

where the majority of plastic is used, and help

correct our trajectory towards our target of 25%

recycled content in plastic packaging by 2025.

In addition, we’re working with Recyclass and

other industry experts and associations to

ensure we have access to the latest recycling

guidelines, and in-country collection and

recycling information. This enables our teams

to design for recycling right from the start of

aproject. The guidance extends beyond plastic

to other materials, ensuring we’re equipped

with the knowledge to make the right choices

in product design and development.

We continue to make progress in reducing our use

of virgin plastic. For example, Dettol’s new surface

cleaner refill in the UK enables consumers to refill

their original bottle and trigger packaging and

results in 75% less plastic versus buying another

750ml Dettol trigger bottle. Looking ahead,

we’re investing in polymer science and research

to find the solutions for our products which will

help us deliver our reduction target by 2030.

for more on Plastics and Packaging.

See reckitt.com/reporting-hub

Reducing waste in our operations

During the year, we reduced waste in

manufacturing by 18% versus 2015, keeping

us on track to achieve our 2025 target of a

25% reduction against our baseline. All of our

manufacturing sites have now achieved zero

waste to landfill, with new waste management

and disposal systems in our US Nutrition sites

(previously the only remaining sites using landfill).

Flue2Chem: cross sector collaboration

to tackle net zero

Reckitt has joined forces with a number

of businesses, universities and NGOs

in the pioneering Flue2Chem project,

spearheaded by Unilever and the Society

of Chemical Industry. The project aims to

cut CO

emissions by converting industrial

waste gases into chemicals to create

more sustainable consumer products.

It focuses on the potential to capture

the carbon created as a byproduct of

industrial processes, such as steel or paper

manufacturing, and converting this into

an ingredient that can be used in cleaning

products for brands such as Dettol. This

not only helps to tackle greenhouse

gas emissions but also promotes a

circular economy, recognising the value

and potential of waste materials while

reducing our reliance on fossil fuels.

Flue2Chem represents an opportunity

to progress our journey towards a

cleaner, healthier world. If successful

and adopted at scale, Flue2Chem could

cut 15 to 20 million tonnes of carbon

dioxide emissions in the UK each year.

CASE STUDY

50 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review continued

Water stewardship

Our ambition is to halve our total product

water footprint by 2040 versus 2015. Where

we operate in water-stressed areas (17 sites)

we aim to be water positive by 2030.

Our Sustainable Innovation Calculator encourages

the design of products that reduce water

consumption across the value chain. Volume and

product mix changes have led to our product

water footprint increasing by 9.9% versus our

baseline. However the expansion of our Calculator

across all parts of the innovation process has

resulted in an improvement versus 2022.

In the near term, our focus on driving water

reduction has centred around our operations and

the catchment areas we are part of, especially in

water-stressed locations. Our progress on water

reduction in our operations remained relatively

static versus last year, with small improvements

driven by production efficiencies, water treatment

recovery, cleaning optimisation and water recycling.

The return on investment from water saving

projects is low given the relative price of water

but within water-stressed locations it remains a

key part of our water strategy for resilience in the

long term. This extends to our catchment area

work. Our Hosur site in India became our first water

positive site in 2022 and we are advancing similar

projects in our other water catchments of focus,

near Mysore in India and in Mexico and Pakistan,

partnering with local NGOs and governments

to support communities and our sites there.

Biodiversity and nature-based solutions

We have committed to developing ecosystem

protection and regeneration programmes

with nature-based solutions in our key value

chains by 2030. Our focus is on the areas

where we can have the most impact, and our

priority commodities include rubber, palm

oil, natural fragrances, dairy and timber.

We have been a contributing member to and

early adopter of the TNFD, whose framework

helps companies identify nature-related

dependencies, risks and opportunities.

Duringthe year, we participated in a pilot of

the scenario modelling guidance focusing on

our latex supply chain (see case study).

To measure the biodiversity impacts of our

activities on local ecosystems we are taking a

science-based approach, developed over the

last two years in collaboration with the Nature-

based Insights (NbI) team, a spin-off from the

University of Oxford. This enables us to quantify

both positive and negative impacts, assess

potential interventions and understand which

will have greatest impact. The outcomes are

helping to shape new ways of working with

suppliers and farmers that support sustainable

development. Our partnerships with smallholder

rubber farmers in Thailand for example, facilitated

by our partner Earthworm Foundation, encourage

good agricultural practices, protecting the

ecosystem and strengthening productivity.

We work with a number of partners to help

regenerate ecosystems and deliver social

benefits, including the Earthworm Foundation’s

palm landscape programmes in Indonesia and

Malaysia. With WWF, our work on critical river

systems in the Amazon and Ganges basins has

helped strengthen the aquatic ecosystem by

preventing pollution and with demonstrable

impact on local wildlife. This supports the water

catchment area of our sites and the sourcing

regions we depend on for our ingredients.

online at reckitt.com/reporting-hub.

See our Sustainability Report

Applying the TNFD framework to our

latex supply chain in Thailand

Reckitt relies on a range of ecosystems

to supply ingredients, including rubber

for latex condoms, palm oil for soaps, and

natural fragrances. Our sustainable sourcing

programme is designed to help protect and

support these ecosystems with nature-

based solutions that can also help mitigate

risks such as climate change. This, in turn,

can have a positive social impact for local

communities. Our suppliers and farmers are key

stakeholders in protecting these ecosystems.

During the year, Reckitt’s Sustainable Sourcing

team, in partnership with NbI, piloted the TNFD

LEAP framework in our latex supply chain to

establish a baseline of our current impact and

identify the potential areas affected by latex

sourcing. The Surat Thani landscape in Thailand

was chosen for analysis due to its high levels

of biodiversity and its importance in supplying

rubber for our Durex brand. It is also the

location of our existing partnership programme

with Earthworm Foundation, which builds

the capacity of local farmers in the region.

NbI’s analytical approach has helped us to

identify areas under stress and focus our

resources where we can have the most impact.

Using the framework, NbI also conducted

a deep dive into deforestation and water-

related risks. In addition, Earthworm identified

the impact of high market prices for durian,

a tropical fruit to which some rubber farmers

were switching. Durian is generally produced

with higher levels of fertilisers and pesticides,

and unlike rubber requires irrigation to farm.

Further land use change of rubber landscapes

to durian therefore represents a risk to the

intensity of local water demands and could

reduce the long-term biodiversity and carbon

gains made by mature rubber plantations.

Reckitt and NbI’s work in Thailand is one of over

200 test cases to use the TNFD framework.

Together we are working with local farmers

and stakeholders to shape targets that are

economically viable and bring a positive

climate, biodiversity and social impact to the

region. We are building a network to evolve

themodel that we have used in Surat Thani and

we are aiming to extend this methodology to

other key commodities in Reckitt’s supply chain,

including palm oil in Indonesia and Malaysia.

on tnfd.global for more detail.

See the TNFD guidance

CASE STUDY

9 (60%) 6 (40%)

64 (71%) 26 (29%)

400 (66%) 202 (34%)

7,983 (49%) 8,294 (51%)

19,931 (55%) 16,120 (45%)

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review continued

Developing our people

On-the-job learning and continuous development

take place throughout the year. All employees

have a formal annual performance review against

business objectives. This is also a chance to discuss

ongoing personal development plans, career

ambitions and potential to take on different roles.

We continue to invest in a range of learning

and development programmes and following

feedback from colleagues have rejuvenated

FAIRER SOCIETY

for our Sustainability Ambitions progress overview.

See page 14

We are committed to enabling a fair, diverse

andinclusive society as an employer and across

our value chain.

Our people

Leveraging diversity

Our cultural diversity is a key strategic

capability, harnessing diversity of thought

to drive our performance. With over 40,000

people from 125 different nationalities

operating across 68 countries spanning six

continents, we closely reflect and represent

the consumers and communities we serve.

Building a culture of inclusion

Our ambition is to build a business where

every one of our colleagues feels able to

be their authentic self as they contribute to

our collective performance, that our brands

reflect this value and support inclusion within

the markets we serve, and that we set clear

standards for the partners and businesses

we work with throughout our value chain.

for more on Our People.

See pages 19-21 See page 38

our approach to personal development. Reckitt

colleagues now have access to a new learning

platform which offers personalised development

options based on role, function and career

aspirations. Aligned to our 10 functional academies

and LinkedIn’s Learning library, colleagues

are able to drive their own development

using the format that works for them.

Since launch in April 2023, our LinkedIn Learning

library had 9,500 active Reckitt users at the year-

end with a total of 14,898 learning hours (2hr 20

minutes average training hours per person).

Of our 10 functional learning academies, the

Reckitt Marketing Academy was our champion in

2023. Targeted at Reckitt marketing professionals,

the Marketing Academy facilitates online and

face-to-face learning and integrates a learning

culture within the business operating model.

– The online platform achieved an impressive

89%participation rate, with 2,286 people

registered across 58 markets

– 70+ countries now have a marketing

upskillingplan

– 70 learning courses are available with an

average 4.3/5 satisfaction score and the

platform received Bronze for ‘best technology’

at the Learning Technologies Awards

In terms of our Group leadership development

programmes, we ran:

– 15 Accelerate/Advanced Accelerate inclusion

focused programmes for high-potential women;

the highest we have ever run in a year

– 7 Explore sessions for our purpose focused

leadership programme for senior leaders,

including two session in Amsterdam, two

intheUS, one in Malaysia and two in the UK

– 5 Global Commercial Future Leadership Potential

programmes to spot and develop high-potential

senior leaders of the future

In addition, our ‘Good to Great’ programme

forhigh-potential leaders aspiring to global

management positions or GEC/functional

leadership roles had 37 people this year;

arecordnumber and investment.

Supporting livelihoods

Reckitt has been an accredited Living Wage

Employer in the UK since 2020. A living wage

goes above and beyond the minimum wage

and reflects the real cost of living. Having

extended this commitment across our global

markets in 2023, we now pay all our employees

above the Fair Living Wage thresholds, as

defined by the Fair Wage Network. We are

also committed to paying a Fair Living Wage

for all our contractors, interns and trainees.

In 2023, we completed an assessment to identify

if any Fair Wage gaps existed and, where they

did, put plans in place to rectify through mid-year

adjustments and our annual pay review process.

for our Remuneration Report.

See pages 100-136

Our Sustainable Livelihood Framework goes

beyond wages to also capture broader work

on providing a safe working environment

that promotes health and wellbeing, equality,

employment rights, long-term financial

security, and skills development to support

ongoing career development for our people.

Gender diversity

We aim to achieve gender balance at all

management levels by 2030.

1. Diversity data is taken as of 31 December 2023 for

active Reckitt employees (excluding contractors)

2. ‘All management’ includes: Executive Committee

Member, Group Leadership team, Senior

Management team, Middle Manager, Manager

3. 79 persons with undisclosed gender

4. Further information on methodology for calculating

diversity performance is available in our Basis of

Reporting Criteria at www.reckitt.com/reporting-hub

Board Directors

GEC and Direct Reports

Senior manager roles

All management roles

All employees

Male Female

52 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review continued

In 2023, our Framework was expanded to

include key Water, Sanitation and Hygiene

(WASH) metrics. The metrics were developed

to ensure that all of our facilities provide people

with access to sufficient, free, safe water that

meets required quality standards; access to

sufficient personal hygiene and hand washing

facilities; and adequate, improved, convenient

toilet facilities (as per the WHO definition of

adequate and improved). We are pleased to

report that all of our facilities met these criteria.

Enabling a fairer society across our value chain

Our global supply chain extends across 70

countries. We work with manufacturing partners,

distributors and various other organisations,

from rural farms to multinational raw material

and packaging material suppliers.

Our focus over the past 12 months has been:

– Expanding the scope of our sustainability

programmes to identify and tackle human

rights and environmental challenges by

engaging more categories of indirect suppliers

and distributors

– Deploying effective remediation where

weidentify cases of modern slavery and

transparently report our findings and actions

– Supporting suppliers to implement

effectivesite-level grievance mechanisms

using the toolkit developed with Oxfam

Business Advisory Service to enable grievances

to be raised and effectively addressed close

tosource

– Looking beyond audit to actively identify and

address potential human rights impacts before

they materialise

– Enhancing our sustainable sourcing activities

within our palm oil and latex supply chains to

enable a healthier planet and deliver sustainable

livelihoods and working conditions

– Ongoing collaboration and partnership through

industry associations and forums, such as

AIM-Progress, the Pharmaceutical Supply Chain

Initiative (PSCI) and the Consumer Goods Forum,

to promote human rights and build sustainable

solutions that make a tangible difference to

tackle systemic issues such as modern slavery

We are committed to protecting human rights

and use impact assessments and action plans

in our key value chains and top 10 priority

markets to monitor and drive improvement.

Having completed our first Human Rights

Impact Assessment of our Durex and Enfa

brand value chains in Thailand, this year we

completed an assessment of our Brazilian

operations (see case study right). Using a tool

developed with the Danish Institute for Human

Rights together with our own knowledge and

insights, we have identified a further eight

priority markets in which we plan to conduct

human rights impact assessments by 2030.

During the year, we also continued our

programmes of risk-based supplier audits,

helping to strengthen labour standards in our

supply chain. We complement these audits

with asupplier capability programme to raise

awareness, knowledge and skills of our suppliers

on labour standards and human rights issues. This

joint approach continues to improve standards

within our supplier network and we report on this

in more detail in our Modern Slavery Statement.

online at reckitt.com/reporting-hub.

See our Sustainability Report

Assessing human rights

impactsinBrazil

As part of our commitment to protecting

human rights across our value chains, we

carry out human rights impact assessments

to understand the actual and potential

impacts affecting a particular market or

geography. These assessments help us

to create locally relevant action plans to

drive improvement for our stakeholders.

In 2023, we completed an assessment

of our operations in Brazil, covering the

value chains of our Olla condoms, SBP’s

Aerosol Pesticides, and Veja’s Multipurpose

Cleaners. It took into account consumers,

our employees, tier 1 suppliers and workers

in the raw material supply chain.

The findings acknowledged the positive impact

we are having through our purpose-led brands.

It also identified several potential human rights

issues, related to systemic issues in Brazil.

These are areas of strength for Reckitt where

we have programmes and strategies in place.

We have identified threekey areas where

Reckitt can continue to drive improvements

inour operations, across our value chain and

forthe communities where weoperate:

– Continuing to take a leadership position

ondiversity, equity and inclusion matters

– Working with local suppliers to ensure

theresponsible sourcing of raw materials

– Increasing access to intimate wellness

products and information on sexual

healthindisadvantaged and lower

incomecommunities

at reckitt.com/reporting-hub for more detail

onourhuman rights programmes.

See our Sustainability Report

CASE STUDY

53 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review continued

Our communities

We aim to reach half the world with our purpose-

led brands, engage two billion people through

our programmes, partnerships and campaigns,

and have a measurable, positive impact on 10

million people by 2030. We have already exceeded

this goal, impacting 18 million people to date.

We have set a target that at least 50% of

ourbeneficiaries should be women. In 2023,

we helped to progress this ambition through

our support for initiatives such as the Climate

Gender Equity Fund and Women in Innovation

Fund (WiNFUND), which both support the

scale-up of women-led grassroots innovation.

An example from the WiNFUND, which is

focused on healthcare, is CHIL AI Lab in Uganda,

which leverages AI to extend specialised and

affordable disease prevention and management

services to women in remote areas.

We see our role as a catalyst to driving lasting,

positive impact in communities. We drive

systems change by leaning into the positive

power of business and do what we do best:

– Driving behaviour change at scale via our

market-leading brands. Examples include Dettol

Hygiene Quest in partnership with Roblox that

has engaged over five million children in 2023

inthe metaverse

– Scaling the social economy by supporting

socialentrepreneurship via mentorship

andcapacity building

– Leveraging innovative finance to create lasting

impact in communities

1. Clean water, sanitation and hygiene: We strive

for universal access in communities around the

world. In 2023, we enabled access to improved

water and/or sanitation solutions for more than

331,000 people in India, Indonesia and Kenya

through our partnership with Water.org.

Since2018, this partnership has enabled lasting

access to WASH for more than two million

people. In 2023, to address critical capacity

challenges in scaling up this programme, Reckitt

invested $2.4 million into WaterEquity’s Global

Access Fund IV, which seeks to increase access

to a further 240,000 people by supporting

financial institutions in emerging markets to scale

their water and sanitation microloan portfolios.

2. Sexual health and rights: We empower women

and young people to know their sexual rights and

protect their sexual health. In 2023, Reckitt and

Durex launched the ‘Safeteen First’ programme

in partnership with UNFPA in Thailand and Mexico,

which aims to positively impact 700,000 people

by 2026 by reducing prevalence of STIs and

unwanted teenage pregnancies through

changing behaviours, breaking stigmas and

increasing condom use.

3. Maternal and child health: We support mothers

and infants to have the best start in life. In 2023,

forexample, our partnership with Wellbeing

Foundation Africa in Nigeria connected with

25,835 pregnant and lactating mothers to educate

on critical hygiene practice to prevent infection.

Our social impact investments are critical

to furthering our fairer society goal to

measurably impact 10 million people by 2030.

This work is funded via our Fight for Access

Fund, which totalled £31.4 million in 2023.

online at reckitt.com/reporting-hub.

See our Social Impact Report

Accelerating social entrepreneurship

We believe we can have the greatest

impact when we work as a catalyst for social

innovation, harnessing the positive power

of business, our brands and our people.

By accelerating the growth of health and

hygiene social businesses, we can leverage

the multiplier effect and address the access

gap whist also unlocking economic growth,

creating jobs and reducing poverty. And by

working with entrepreneurs that inherently

understand the needs of their communities,

we can reach people with solutions that work.

In partnership with Yunus Social Business,

we are providing innovative WASH social

enterprises with the support they need to

scale: capacity building, expert mentorship

from Reckitt people and seed funding.

We have done this so far in Brazil, South

Africa and more recently, Nigeria.

In South Africa and Brazil, six months from

the close of the acceleration period, the

12 enterprises reported the following:

– A 56% increase in the total number of

full-time employees

– A 12x increase in the number of people

positively impacted by their business

One of those enterprises is Kusini

Water, based in South Africa, which

utilises waste macadamianut shells and

nanotechnology to build water filtration

systems that remove99% of disease-

causing bacteria, parasites and debris.

Kusini Water was able to reach an

additional 8,000 people with clean water

within six months of the acceleration

period ending. It is also now working to

implement clean water systems in a further

13 schools across rural South Africa.

Kusini Water alongside its Reckitt mentor,

Deroosha Naidoo, was the subject of the

‘Climate and Us’ film produced for Reckitt

by BBC Storyworks Commercial Productions

and presented by the Global Climate

and Health Alliance at COP28 in UAE.

CASE STUDY

54 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Sustainability Performance Review continued

NON-FINANCIAL AND SUSTAINABILITY INFORMATION STATEMENT

We are committed to the 10 principles of the UN Global Compact in the areas of human rights, labour, the environment and anti-corruption.

Relevant policies and risk management processes Additional information

Environmental

matters

Our Environmental Policy sets out our objectives for reducing our environmental impacts. It requires compliance with relevant legislation, consideration of environmental

issues in key decisions, and engagement with multiple stakeholders for better environmental performance which is monitored through our Group Environmental

Management System. Our Supply Chain Leadership team routinely monitors environmental performance, including progress on our climate ambitions through our

operational change carbon emissions programmes. These are also reviewed at Business Unit, Group and Board level on a quarterly basis. Our Sourcing for Sustainable

Growth Policy sets out Reckitt’s human rights, health and safety, environment and sourcing requirements for all business partners. The policy details six responsible sourcing

principles that drive us to conduct business with honesty and integrity, respect human rights, provide a safe and healthy working environment, use safe and sustainable

ingredients, source raw materials responsibly, protect the environment and reduce environmental impact. The policy applies to Reckitt employees and third parties.

Environmental

Performance

Review,

pages48-50

Employees Reckitt’s Code of Conduct governs standards of conduct in relation to our employees, as well as our stakeholders. All employees must complete code of conduct training

and are encouraged to refer to the code frequently to ensure the right decisions are made. In addition, Reckitt has policies committing to equal opportunities at work and to

providing a safe and healthy working environment. Health and safety performance is monitored through our Group Occupational Health and Safety Management system,

enabling us to investigate any incidents and take any necessary action. We have a Speak Up policy and process, allowing any employee or third party to confidentially report

a violation of the Code of Conduct, local law or regulation, or unethical behaviour.

Social Performance

Review, page 51

Our People,

pages19-20, and 38

Human rights

Respecting human rights is an absolute and universal requirement and through our Code of Conduct we set out our commitment to respecting the fundamental human

rightsdefined in the UN Universal Declaration of Human Rights. Our Labour and Human Rights Standard sets out the requirements and practices expected of our supply chain.

Our Sourcing for Sustainable Growth Policy (see above) also encompasses principles of the International Bill of Human Rights and the International Labour Organization’s (ILO)

Declaration on Fundamental Principles and Rights at Work. We also follow the UN Guiding Principles on Business and Human Rights and Organisation for Economic Co-operation

and Development (OECD) Guidelines for Multinational Enterprises. Our Supply Chain Leadership team monitors our human rights and labour standards assessment programme

on a monthly basis, while these are also reviewed at Business Unit, Group and Board level on a quarterly basis.

Social Performance

Review, page 52

Our Suppliers,

page39

Social and

community

matters, including

consumers

Reckitt’s Product Safety Policy describes our approach to safety assurance for products, covering product development; monitoring in-use safety and feedback from users;

and reacting promptly and effectively to mitigate potential harm. In addition, our Responsible Marketing Policy covers the full marketing lifecycle of our products and applies

to all marketing communications touchpoints and channels. It applies to everyone at Reckitt and external parties. We perform ongoing audits and adherence checks on policy

implementation. We also monitor consumer, customer and employee feedback on an ongoing basis, through our consumer care lines or our Speak Up Line.

Social Performance

Review, page 51-53

Our Stakeholders,

pages 37-40

Anti-bribery

andcorruption

Our policy is that all Reckitt companies, employees and contractors must comply with the anti-bribery, anti-corruption and competition laws of all countries in which they

operate. Directors and managers must ensure that the employees and contractors they supervise are aware of and comply with this policy. All employees and contractors

must certify annually that they have complied with our Code of Conduct, and the Audit Committee reviews internal audit findings in relation to this.

Emissions information Page 48

Climate-related financial disclosures Our climate-related financial disclosures can be found on pages 218-222 and are incorporated into the Strategic Report by reference

Diversity information Page 51

Policy embedding, due diligence and outcomes Risk Management, pages 55-56 | CRSEC Committee Report, pages 96-99

Principal risks and impact of business activity Pages 57-60

Description of business model Page 12

Non-financial key performance indicators Pages 13-14

Board

and

Committees

Enterprise level

risk management

Operational level risk management

Enterprise Risk Management Framework

GBUs

Roles and

responsibilities

Policy and

process

Tools and

training

Core

functions

Sites, regions

and programmes

GEC

Continuous

process of risk

review and

management

Communicate and escalate

Strategic objectives

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Risk Management

Risk governance

The Board provides oversight over our principal

risks and the Audit Committee monitors the

overall effectiveness of our risk management

and internal controls framework.

Board oversight is achieved through several

mechanisms which include reviews of strategic

programmes, Committee meetings and

focused reviews into selected risk areas.

The Group and GBU Risk, Sustainability &

Compliance Committees (RSCCs) support the GEC

in its oversight role. These are embedded within

the governance structure of the organisation,

with escalation between committees as needed.

They meet quarterly to review, challenge

and monitor risk management activities.

Ownership and accountability for the management

of principal risks resides with the GEC. There is

an accountable owner for each principal risk.

Our Risk Management Framework is aligned

with the Three Lines of Defence model, which

assigns roles and responsibilities for risk and

control across line management, oversight

functions and independent assurance providers.

Risk appetite

The Board interprets risk appetite as the level of

risk that the Company is willing to take to meet

its business objectives. The Board’s appetite for

risk is communicated to the organisation through

our strategic and business planning process and

control frameworks. The Board recognises that not

only does risk mitigation need to be proportionate

to the benefit gained, but also carefully balanced

with a degree of flexibility to support Reckitt’s

dynamic and entrepreneurial culture.

In assessing risk appetite, the Board reviews the

three-year business plan and associated strategic

risks. Risk appetite for specific financial risks such

as funding and liquidity, credit, counterparty,

foreign exchange, interest and commodity risk are

set out in the Board-approved Treasury policies.

Compliance with our safety standards and our

legal and regulatory requirements is mandatory.

Taking and managing risk is essential

to operating and growing our business

safely, effectively, and sustainably.

Our approach to risk management

Our Risk Management Framework provides

a consistent approach to risk management

across the organisation and facilitates the timely

communication of risks to ensure the right people

at the right level are managing the right risks.

Risk management process

We embed risk management at multiple levels

of the organisation. Our framework ensures

risks are identified, assessed, mitigated and

monitored in an effective and consistent

way and supports information flow and

open communication between the GEC,

GBUs, our functions, markets and sites.

Our Group Risk team facilitates the risk

management process throughout the year.

Thisensures that we are appropriately prioritising

our efforts and resources to manage our risks.

The Group’s risk profile along with key mitigations

and action plans are reported throughout the

year, providing the GBU Leadership, GEC and

Board with an enterprise-wide view of risk.

RISK MANAGEMENT

ATRECKITT

Speed

of impact

Financial

impact

Years

Minor impact

Weeks

Months

Days

Severe impact

Significant

impact

Major impact

Remote RemotePossible PossibleLikely LikelyLikelyHighly likely

Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Risk Management continued

Emerging risks

Emerging risks and horizon scanning are integrated

into our risk management process and provide

a forward-looking view of major trends that

have the potential to impact the business across

a longer time horizon (>three years). We are

currently monitoring a number of emerging risks.

The impact of industry on nature and biodiversity

is a growing area of interest and emerging

risk, both in terms of resilience of supply

chains and the impact of growing regulatory

frameworks. With this in mind, we have developed

programmes to prevent deforestation, support

water resources in areas of water stress and

act to prevent pollution from manufacturing

operations. We have also developed biodiversity

impact monitoring systems that steer activity

in key value chains. These help us introduce

activity to mitigate impact on biodiversity and

will support our emerging reporting against the

guidance from the TNFD, to which we have been

a contributing member for the past year. This

complements our activity on climate change

and reporting against the guidance of the TCFD,

given climate change is frequently a driver of

nature-related issues. For more information on

our response to TCFD, please refer to page 218.

The emergence of generative AI tools presents

new opportunity for how we work across all areas

of the Company. However, the nature of this

new technology and the speed at which these

tools are being developed has the potential to

impact data privacy, accuracy and reliability. Our

Information Technology & Digital (IT&D) and Legal

teams are working closely to ensure that any AI

tools utilised across the organisation are fully risk

assessed, with appropriate actions taken where

necessary, and that our policies (e.g. AI Tools

Policy) are adopted and regularly updated.

KeyManufacturing Sites, to provide greater

focus on these two key areas of our supplychain

– Sustainability has evolved to ESG Transition

inresponse to the changing regulatory

environment and the growing ESG reporting

agenda. This risk includes the work being done

to understand the impact of climate risk and

respond to our climate-related disclosures

– Product Quality and Product Safety have been

merged to create a Product Safety risk,

reflecting the close interdependencies

between these two areas

– South Korea Humidifier Sanitiser (HS), which has

been managed as its own principal risk for a

considerable period, has now been subsumed

within the Legal and Compliance principal risk

Developments in disruptive science and

technology may impact some of the categories

in which we operate, such as the traditional cold

and flu category. Our R&D and Science teams

actively engage with the scientific community

to stay abreast of leading developments

in science, medical and regulatory affairs,

and the impact of emerging technology.

Finally, we continue to see consolidation across the

sector, with increasing levels of competition for

acquisition targets. Our CorporateDevelopment

team, which is responsible for identifying,

evaluating and executing on Reckitt’s global

M&A opportunities, partners closely with each

GBU to actively manage our portfolio and

undertake competitive screening activities.

Our principal risks

The Group’s principal risks represent the

most significant risks facing the Group and

arise from one or a combination of internal

or external factors. The Group’s risk profile

is reviewed biannually, with risks assessed

across a timeline of up to three years.

During the year, we undertook a review of our

principal risks to make them more focused

and specific to our business. This included re-

evaluating their potential impact and likelihood.

The 10 listed are assessed as being the most

material risks to the Group. Four risks previously

reported fell below this threshold, and whilst

they will continue to be managed in the same

way, they have not been reported in detail here.

These risks are Employee Health and Safety,

Tax Disputes, Commercial, and People. Other

key changes to the principal risks include:

– Supply Disruption risk has been split into

twomore specific supply-related risks,

SupplierDisruption and Reliance on

Principal risk

1. Cyber Security

2. Changes to Product Regulations

3. Legal and Compliance

4. Supplier Disruption

5. Geopolitical Instability

Principal risk

6. ESG Transition

7. Product Safety

8. Innovation

9. Reliance on Key Manufacturing Sites

10. Economic Volatility

57 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Risk Management continued

OUR PRINCIPAL RISKS

The risks listed in this section and the activities being undertaken to manage them should be considered in context of the Group’s internal control framework described in the Corporate Governance statement on

page78. Each of our principal risks has been linked to Our Strategy. For more information refer to page 11.

Risk What is the risk? Examples of how we are managing the risk Mitigation progress this year

1 Cyber Security

Risk trend:

Increasing

Link to strategy:

Oversight Committee:

Main Board

A cyber security incident that could

compromise the confidentiality, integrity

and availability of critical IT systems,

and the data held on them, within our

own network or that of a third party.

Such an attack could impact our ability

to manufacture and/or move products,

resulting in a material impact on our

market value and reputation.

This risk is heightened as we become a

more digitally-enabled and data-driven

Company with greater connectivity

and mandatory internal and external

compliance obligations to protect

our customers, suppliers, consumers

and critical business processes.

– We operate a Group-wide cyber security control

framework,aligned with industry standards, including ISO

and National Institute of Standards and Technology (NIST).

This includes security controls and active monitoring across

our factory environments to ensure we identify and manage

any vulnerabilities

– We undertake regular horizon scanning and threat

detectionactivities, perform penetration testing

andworkclosely with our third parties and partners

tomanage cyber risk.

– Mandatory Cyber Awareness training is rolled out to all

employees across the Group as part of our compliance

training programme

– During the year, we have seen cyber threats continue

torise.In response, we have continued to strengthen

ourgovernance and controls through the Cyber Security

programme. This has included a campaign to raise

awareness of cyber security across the organisation

andensure business-critical systems are supported

bydisaster recovery plans

– We have launched a multi-year programme to strengthen

security and resilience across our factories, including

againstcyber threats

2 Changes to Product

Regulations

Risk trend:

Increasing

Link to strategy:

Oversight Committee:

CRSEC Committee

Failure to identify, assess and proactively

respond to new or changing regulations

or emerging detection methodologies

impacting our products could result in

increased regulatory scrutiny, costly

product reformulations or product

recalls, potential litigation and the license

to sell a product being removed.

– Our Regulatory Intelligence programme proactively

identifies new or changing regulations and trends

inenforcement practice

– Regulatory Affairs and Safety (RAS) works closely with

thebusiness to assess and respond to new regulations

impacting our existing portfolio of products

– Our Ingredient Steering Group monitors regulatory

developments, reviews classification changes and

completes impact assessments

– We work closely with external regulators, engaging

withthem to advocate on any new or pending product

regulations where it is feasible to do so

– We have consolidated our Regulatory Operating model

toreduce complexity

– We have completed nitrosamine assessments for all

products in line with regulatory requirements

– We have strengthened our REACH compliance programme

with enhancements to our systems, processes and data

– We continue to strengthen our claims substantiation and

have put in place long-term initiatives to establish corporate

data standards and oversight to improve our data quality

and availability

High gross

margin business

Brand

Investments

Adjusted operating profit growth

ahead of net revenue growth

Strong cash flow and

healthy balance sheet

Capital Allocation

Framework

Key

Sustainable mid-single-

digit growth

58 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Risk What is the risk? Examples of how we are managing the risk Mitigation progress this year

3 Legal and

Compliance

Risk trend:

Increasing

Link to strategy:

Oversight Committee:

CRSEC Committee

We operate in multiple jurisdictions which

creates a complex regulatory environment.

Aserious violation of competition,

anti-corruption, human rights or data

protection legislation or economic sanctions

within our operations or our supply chain

could result in significant fines, penalties

andreputational damage.

A number of products are manufactured and

sold in litigious jurisdictions, which increases

the risk for potential class action and mass tort

litigation that could result in significant legal or

settlement costs and reputational damage.

– A global Ethics and Compliance programme including

annualtraining, ‘Speak Up’ hotline, compliance policies

andprocedures, targeted risk and control assessments

andthird-party due diligence

– Embedded legal and compliance teams, supported by

externalexperts as needed, to help us identify, understand

andcomply with current and emerging regulatory obligations

– Group Privacy Office (GPO) and in-market privacy

programmes to support the business and provide oversight

ofdata protection policy compliance

– Disputes and litigation are supervised by senior members of

the Legal team, with General Counsel oversight of significant

Group matters

– Our Code of Conduct has been updated and is supported

with a refreshed code of conduct and ‘Speak Up’ training

– We continue to evolve our Ethics and Compliance programme,

including additional metrics to support the ongoing

monitoring of key compliance risks

– Our Legal and Compliance team has been working closely

with our Sustainability team to ensure that evolving

ESGregulations are fully understood and to support the

management of ESG Transition risk (see principal risk 6 below)

4 Supplier Disruption

Risk trend:

No change

Link to strategy:

Oversight Committee:

Main Board

Over-reliance on a limited number of

suppliers, geographic concentration, or an

excessive dependence on specific routes,

sub-suppliers or technologies could render

our supply chain vulnerable to disruption.

Our business is dependent on a significant

number of sole- and single-source suppliers

for critical raw and pack materials.

– We carefully monitor all our third-party suppliers

– Our Procurement team regularly risk assesses our suppliers

across multiple dimensions using our supplier vulnerability tool

– Action plans are put in place for any suppliers identified as

critical to our supply chain to ensure continuity of supply in the

event of a disruption. Where possible, these include business

continuity planning and the qualification of alternative suppliers

– Action plans are centrally tracked and monitored through our

quarterly Supplier Risk Committee

– We have continued to de-risk our sourcing of critical materials

through the qualification of alternative suppliers and have

reduced the total value of single-sourced spend across each

GBU. In 2023, we reduced monosourcing of critical materials

by 9.4%

– We have started mapping our suppliers further up the value

chain to identify any potential geographic concentration risk

– An SKU simplification programme has been initiated

toreduce complexity across our supplier base, and

ourprocurement teams are working more closely with

ourR&D teams to ensure supplier resilience is built into

theearly stages of new product development

5 Geopolitical

Instability

Risk trend:

Increasing

Link to strategy:

Oversight Committee:

Main Board

Geopolitical events, including threats of

conflict, trade wars, economic sanctions

andpolitical polarisation, could disrupt our

operations. Our presence in unstable regions

and countries further increases this risk.

– We maintain an extensive network of local regulatory and

external affairs teams, which together with external advisors

closely monitor the political and geopolitical environment

– Our Issues and Crisis Management team supports the

businesswith market-specific risk assessments and resources

to support with regional issue and crisis management

– Geopolitical risk is considered within our business continuity

planning for the resilience of our supply chain

– Our Corporate Security Function identifies potential threats

through the Corporate Security programme and supports

thebusiness with horizon scanning activities

– The GEC provides ongoing oversight over the management

of the Group’s geopolitical risk profile. We continue to

diversify our supply chain through regionalisation and

onshoring to mitigate any regional instability

– Ad hoc horizon scanning and scenario planning activities are

undertaken by the GEC and in-country management teams

Risk Management continued

High gross

margin business

Brand

Investments

Adjusted operating profit growth

ahead of net revenue growth

Strong cash flow and

healthy balance sheet

Capital Allocation

Framework

Key

Sustainable mid-single-

digit growth

59 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Risk What is the risk? Examples of how we are managing the risk Mitigation progress this year

6 ESG Transition

Risk trend:

No change

Link to strategy:

Oversight Committee:

CRSEC Committee

Changes in the regulatory environment

andshifting stakeholder expectations

emerging from the transition to a more

sustainable, net zero economy could

createsignificant uncertainty for Reckitt.

There isa risk that we fail to deliver our

ESGprogramme or deliver against our

sustainability ambitions.

– A Group ESG reporting function is in place and responsible

for identifying, assessing and implementing emerging

ESGregulation

– Tools have been developed to support delivery against

oursustainability ambitions, including the SIC. This has been

implemented across our innovation pipeline to quantify

sustainability improvements across carbon, water, plastics

and packaging, ingredients and overall Extended Producer

Responsibility (EPR) risk

– Performance against our Sustainability Ambitions is centrally

coordinated, monitored, and reported

– A DE&I Board is in place to provide oversight across diversity

and gender balance

– We have established cross-functional steering

committeesproviding governance and oversight across

keyESG transition risks and sustainable product activities

– A taskforce to respond to the Corporate Sustainability

Reporting Directive (CSRD) has been established,

whichisfocused on preparing the business to meet

itsincoming requirements

– We have started product carbon footprint modelling

toidentify and prioritise reductions in our product

carbonfootprint in partnership with our suppliers

andinnovation teams

7 Product Safety

Risk trend:

No change

Link to strategy:

Oversight Committee:

CRSEC Committee

Across our broad consumer-facing

portfolio, many of our products are

ingested, have direct skin contact,

areconsumed by a varied range of

demographics and vulnerable populations,

and can contain corrosive/flammable

chemicals. Failure to prevent, identify

orrespond to a product quality and/or

safety issue may result in potential

consumer harm or death, financial

settlements (product liability claims),

costlyrecalls and reputational damage.

– Our Consumer Safety and Vigilance team partners with

eachof our GBUs, embedding product safety into operations

and providing oversight and assurance services

– A robust quality management system is in place

underpinnedby clear policies and supporting systems,

andissubject to regular independent audits

– Our manufacturing facilities adhere to Quality Manufacturing

Systems and our adverse and critical events process and

ourdedicated Vigilance team allows us to monitor and

respond to any product quality or safety issues

– Role-based mandatory Product Safety training is in place, with

all employees required to complete Adverse Events training

– We continued our five-year Global Safety Transformation

programme to elevate our global safety approach across

safety culture, processes, systems and data

– We have deployed our global quality management system

(Quality One) to support better control of, and visibility into,

product quality and safety processes

– A cross-functional Quality, Regulatory and Safety (QRS)

Council has been created to enhance Reckitt’s

complianceprogrammes

Risk Management continued

High gross

margin business

Brand

Investments

Adjusted operating profit growth

ahead of net revenue growth

Strong cash flow and

healthy balance sheet

Capital Allocation

Framework

Key

Sustainable mid-single-

digit growth

60 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Risk What is the risk? Examples of how we are managing the risk Mitigation progress this year

8 Innovation

Risk trend:

No change

Link to strategy:

Oversight Committee:

Main Board

Our continued growth and success

depends on the relevance of our brands

toconsumers and our ability to innovate.

Failure to effectively innovate, launch

andmarket new products could lead to

adverse financial performance and loss

ofmarket share.

– Consumer trends, behaviour and needs are analysed through

our Demand Centered Growth process based on targeted

consumer segments

– Innovation projects follow a standardised operating model,

which includes defined stage gates and cross-functional

approvals, with oversight from our Category and R&D teams

– Enhanced reporting provides greater visibility over our

innovation pipeline

– To ensure we are identifying and responding to changing

consumer needs, we continued to make investments in

ourscience platforms to create superior, longer-term and

differentiated products, strengthen our claims and lead

withconsumer-relevant solutions

– We have enhanced our external partnership capability to

drive co-creation of innovation through greater external

orientation in key areas like sustainability

9 Reliance on Key

Manufacturing Sites

Risk trend:

No change

Link to strategy:

Oversight Committee:

Main Board

We are heavily reliant on a few key

manufacturing sites to produce our

products. An unexpected shutdown

atoneof these sites or a sustained

increaseindemand could lead to a

significant interruption to the production

ofa specific component or product.

– Each of our manufacturing sites is classified through

athree-tier system based on revenue dependency

orcriticality to market. This drives our site inspection

programme with Tier 1 sites being subject to more

regularinspections

– We operate a Global asset protection programme through

our insurers, which includes a rotational review of sites

– Our Global Health and Safety and Corporate Security teams

maintain a framework of standards and complete a global

audit compliance programme

– Short- and medium-term strategies are being implemented

to build redundancy into our manufacturing network.

Theseinclude investment in line capacity, refocusing

ofmanufacturing operations and dual sourcing for

criticalbrands

– We have deployed the Reckitt Production System

acrossallour manufacturing sites to drive sustainable

manufacturing performance

– We continue to closely monitor the external environment

and develop business continuity plans to minimise the

impact of any disruption

10 Economic Volatility

Risk trend:

No change

Link to strategy:

Oversight Committee:

Main Board

Adverse economic conditions, together

with high levels of volatility and

unpredictability in the macroeconomic

environment, could impact our ability to

deliver consistent and predictable growth.

– Price volatility is managed through our CRM process,

whichdetermines the optimal price management

strategiesfor energy and other key commodities

– Our Treasury function oversees the Group’s risks relating to

foreign exchange and interest rate risk management through

several controls, including policies, oversight of market and

GBU activities, monitoring and reporting

– We launched our Planning and Forecasting programme

aspart of our Finance for the Future Transformation

programme. The programme aims to mitigate against

unpredictability in the external environment and improve

the accuracy of planning and forecasting activities.

Theprogramme will continue into 2024

Risk Management continued

Sustainable mid-single-

digit growth

High gross

margin business

Brand

Investments

Adjusted operating profit growth

ahead of net revenue growth

Strong cash flow and

healthy balance sheet

Capital Allocation

Framework

Key

61 Reckitt Annual Report and Accounts 2023 STRATEGIC REPORT FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCE

Our Viability Statement

Assessment of principal risks and viability

To further test the robustness of the base case

forecast, further analyses were prepared to

consider the viability of the business in the

event of adverse unexpected circumstances.

Such adverse circumstances were modelled

primarily upon the crystallisation of the Group’s

principal risks (see pages 57-60, including how

we are managing the risk). Principal risks have

the potential to create adverse circumstances

for the Group and can occur individually or in

combination with each other. The assessment

of viability considered the implications of

crystallisation of each principal risk and

estimating the impact on interest cover ratios

andheadroom over available borrowing facilities.

These principal risks were aggregated to create

two scenarios which model plausible downside

scenarios of increasing severity based on:

(i)crystallisation of principal risks deemed to

havethe most relevant potential impact on

viability; and (ii) crystallisation of all principal risks

and the impact of adverse movements in foreign

exchange and interest rates. The principal risks

that were evaluated also include the failure to

address existing and emerging environmental,

social and governance (ESG) and sustainability

risks and the changing societal and stakeholder

expectations of businesses in addressing these.

The Board has also considered the potential

impact of changes to environmental factors which

may affect the business model and performance in

the future, as set out in the Taskforce on Climate-

related Financial Disclosures (TCFD) statement on

page 218. The analysis indicated that even with

unexpected events occurring immediately and

in combination, Reckitt would still have sufficient

funds to trade, settle its liabilities as they fall due

and remain compliant with financial covenants.

The Board has further considered the occurrence

of a Black Swan event: an event of greater

adversity than those modelled above, with

sufficient potential impact to risk the future of

Reckitt as a strong and independent business

operating in its chosen markets. The occurrence

of a major issue could result in significant

reputational impact, a substantial share price

fall, significant loss of consumer confidence

and the inability to retain and recruit quality

people. Such an event could have an impact

on the viability of the business. On the basis

of a comprehensive set of mitigating controls

in place across the business, considering the

unknown nature of a Black Swan event and that

its occurrence is considered highly unlikely, ithas

not been included in the Viability Review.

Viability Statement

The Board believes that the Group is well-

positioned to manage its principal risks

successfully. The Board’s belief is based on

consideration of the historic resilience of

Reckitt and has taken account of its current

position and prospects, the actions taken to

manage the Group’s debt profile, risk appetite

and the principal risks facing the business

in unexpected and adverse circumstances.

Mitigating actions, should they be required,

are all within management’s control and

could include reduced capital expenditure or

temporary suspension of dividend payments.

Conclusion

As a result of the Viability Review, the Board

has a reasonable expectation that the Group

will be able to continue in operation and meet

its liabilities as they fall due over the five-year

period covered in the Viability Review.

The Strategic Report, as set out on pages2

to 61, has been approved by the Board.

Catheryn O’Rourke

Company Secretary

Reckitt Benckiser Group plc

21 March 2024

The Board’s Viability Review is based

on the Group’s strategy, its long-term

financial plan and its principal risks.

A financial forecast covering a five-year period

was prepared (the base case). This period was

selected as it is the period covered in the Group’s

long-term forecasting process, based on the

budget and projections for the following years and

covers the introduction to market of the current

new product pipeline. The period also covers the

majority of Reckitt’s debt repayment profile.

The financial forecast is based on a number of

key assumptions aligned to the Group’s growth

strategy, planned capital spending and capital

allocation policy. The assessment of viability takes

into account the Group’s cash flow, its currently

available banking facilities and interest cover

ratios in relevant financial covenants, and does

not assume the raising of additional new debt

or equity finance. If Reckitt performs in line with

the base case forecasts, it will have sufficient

funds to trade, settle its liabilities as they fall

due, remain compliant with financial covenants

and remain viable. Moreover, the Group has

access to external debt markets on account of

its credit rating together with a well-diversified

supplier network, customer base and product

range, and geographical activities with a strong

innovation pipeline and dividend cover.

THE ASSESSMENT PROCESS

AND KEY ASSUMPTIONS

60%

40%

Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Corporate Governance Report

AT A GLANCE

DIVERSE LEADERSHIP

UK Corporate Governance Code: 2018 Statement of Compliance

For the year ended 31 December 2023, the Company complied

withall the provisions of the Code and the Disclosure Guidance

andTransparency Rules requirements to provide a corporate

governance statement.

How we comply with the Code

1. Board leadership and company purpose Page

Our Board of Directors

65-68

Group Executive Committee

69-70

Reckitt’s approach to governance

71-73

Board activities during 2023

74-75

Market Context, Our Strategy and

Our Business Model

07-12

CRSEC Committee Report

96-99

2. Division of responsibilities

How we are governed

80-81

3. Composition, succession and evaluation

Board performance review and effectiveness

Nomination Committee Report

83-87

4. Audit, risk and internal control

Audit Committee Report

88-95

5. Remuneration

Remuneration Committee Report

100-132

1. As at close of business on 31 December 2023

2. Board skills as at 15 March 2024

3. Board members who have served over nine years as

at the date of this Report will retire at the 2024 AGM,

with the exception of Mary Harris, who will remain

onthe Board for a fixed term until the 2025 AGM to

support a smooth Remuneration Committee Chair

succession (see page 64)

Board members skills overview

Core skill

Gender

Tenure

1,3

Nationality

Male

Female

Under 3 years

3-6 years

6-9 years

9+ years

British

American

French

British/Dutch

American/British

Danish

Italian/British

Italian/Brazilian

Financial Expertise

Consumer Goods & Retail Healthcare & Pharmaceuticals

Strategy & Transformation

Leadership Digital & Marketing

for details of Board members who served during the year

and as at the date of this Report.

See pages 65-68

63 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Corporate Governance Report continued

Dear shareholder,

On behalf of the Board, I am pleased to present

Reckitt’s Corporate Governance Report for

the financial year ended 31 December 2023.

The Board is responsible for the effective

leadership of the Group and for promoting

its long-term sustainable success.

The Board provides leadership by setting

theCompany’s Purpose, strategy and values,

overseeing implementation of the strategy by

management and monitoring culture to ensure

itsalignment with our Purpose and values.

TheBoard ensures there are appropriate

processes in place to manage risk and monitors

the Company’s financial and operational

performance against objectives.

Evolution of the Board and Executive Team

Since I have now completed nine years on the

Board, a process was undertaken during the year

to identify my successor as Chair. This exercise

was undertaken by the Nomination Committee

(excluding me) and led by Andrew Bonfield.

Further information on the process is described

onpage 86. It was successful, and I am delighted

to be succeeded by Sir Jeremy Darroch who will

take over as Chair of the Board with effect from

the conclusion of the AGM.

Sir Jeremy joined the Board as Senior Independent

Director in November 2022. He is an outstanding

leader with considerable expertise, a proven track

record of performance and a unique insight into

what motivates consumers as well as a passion

for responsible and sustainable business.

Our evolution as a Company has also been

accompanied by a transition in our executive

leadership team. On behalf of the Board, I’d like to

thank Nicandro Durante for the exceptional job he

has done as CEO, helping to oversee the selection

of a permanent CEO and a new CFO, andfor

working with Kris Licht to ensure a seamless

transition for all our stakeholders. The Board came

into this process knowing we had a strong bench

of leadership talent and Kris Licht was identified

as the outstanding candidate to be CEO. Kris has

been instrumental in Reckitt’s transformation

through his role as Chief Transformation Officer

and his strong operational leadership of our Health

GBU. He has a deep understanding of Reckitt’s

business, customers, brands and culture.

During the year, Jeff Carr, our Chief Financial

Officer (CFO) notified the Board of his

intention to retire in March 2024. Following

a thorough search, Shannon Eisenhardt was

appointed as CFO Designate on 17 October

and will succeed Jeff as CFO in March 2024.

Shannon brings extensive experience across

the consumer goods and retail sectors, having

worked with some of the most globally

recognised brands. Shannon is a proven

strategic and operational leader with a track

record of building highly successful teams and

delivering strong and consistent performance.

CHAIR’S

INTRODUCTION

TO GOVERNANCE

Our Board is committed to

upholding the highest standards

of governance in the long term

interests of our shareholders

andstakeholders.

Chris Sinclair

Chair

64 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Corporate Governance Report continued

Following Kris’s appointment as CEO Designate

in May, there were also changes to our Group

Executive Committee (GEC) membership.

Pat Sly was appointed as President Health

having previously led Reckitt’s Global Nutrition

business since 2021. Pat was succeeded as

President Nutrition by Susan Sholtis, who

rejoined Reckitt on 1 July 2023. Susan has

adeep knowledge of the Nutrition business,

having previously worked for more than 11 years

at both Mead Johnson and Reckitt in general

management and global marketing roles.

On 12 January 2024, we announced the

appointment of Marybeth Hays as a Non-Executive

Director, with effect from 1 February 2024.

Marybeth has over 25 years of experience in the

retail, healthcare and consumer goods sectors

and we are delighted Marybeth has agreed

to join the Board. More details on Marybeth’s

appointment can be found on page 84.

In February 2024, we were also delighted to

confirm the appointment of Fiona Dawson

as a Non-Executive Director and as Chair

Designate of the Remuneration Committee

from 1 June. Fiona brings extensive consumer

goods experience and is passionate about

sustainability, health and wellbeing – particularly

women’s entrepreneurship and human rights.

On the same day, we announced that Alan

Stewart, currently Non-Executive Director and

Chair of the Remuneration Committee, had

notified the Board of his intention to retire

from the Board following the AGM in May.

To ensure continuity in relation to the

Remuneration Committee, Mary Harris, former

Chair of the Remuneration Committee and the

current Designated Non-Executive Director for

Engagement with the Company’s Workforce,

willbe reappointed as Chair of the Remuneration

Committee upon conclusion of this year’s AGM,

for a fixed term until our next AGM in May 2025.

Although Mary has now served nine years as

a Non-Executive Director of the Company,

the Board unanimously agreed that Mary is

uniquely positioned to undertake the role of

Remuneration Committee Chair during this

interim period due to her extensive knowledge

of the business, her in-depth understanding of

investor and other stakeholder expectations

and previous Remuneration Committee Chair

experience. Mary is considered to continue to

retain an independence of mind and to be an

effective and valued contributor to the Board.

Elane Stock will take on the role of Designated

Non-Executive Director for Engagement with

the Company’s Workforce from Mary Harris, with

effect from the conclusion of this year’s AGM.

At the conclusion of the 2025 AGM, Fiona will take

on the role of Remuneration Committee Chair.

Board performance review

The Board undertakes an annual review of its

own and its Committees’ performance and

effectiveness. The Board performance review

was facilitated by Lintstock Ltd (Lintstock),

as part of its ongoing Board Development

Programme. Details of this year’s Board

performance review, together with our progress

against the outcomes from our 2022 Board

performance, can be found on page 82.

Our people and culture

Our culture and values define the way that Reckitt

does business and this starts with our employees.

We aim to create the space and opportunities

to help our employees make a difference and

do the right thing, always. It is our collective

responsibility to build inclusion into everything

we do, whilst ensuring we represent the people

we are and the global community we serve.

Our Code of Conduct reinforces our principles

of business conduct and is communicated to all

employees each year with mandatory training.

Our values underpin our Code of Conduct and

are enhanced by our Purpose and Compass.

We are evolving a vibrant, inclusive and

collaborative culture to deliver on our Purpose.

Inembedding inclusivity, all colleagues should

feel free to participate fully, bring their authentic

self towork and realise their full potential.

Internally, we are strengthening our inclusive

culture by focusing on leadership, people

and policy. Externally, our inclusive approach

to procurement, brands and partnerships

aligns what we do with who we are.

Further details on our people, culture and inclusion

can be found on pages 19 to 21 and page 51.

Engaging with our stakeholders

Effective engagement with our shareholders,

our employees and wider stakeholders is key to

Reckitt’s sustainable success. We, as directors,

must act in a way that we consider, in good faith,

would be likely to promote the success of the

Company for the benefit of its shareholders

as a whole. In our decision-making, the Board

also considers wider stakeholder interests.

Our key stakeholders include our employees,

shareholders, customers, consumers, partners,

and the communities in which we operate and

the environment. Our Section 172 Statement,

which explains how the Directors have discharged

their responsibilities during the year under

review, can be found on pages 76 to 77.

For further information on our Sustainability

Ambitions, please see pages 14 and 47-54.

Our Climate-related Financial Disclosures

can be found on pages 218 to 222.

I am extremely proud of the Board and all

our Reckitt employees for their continued

commitment to our Purpose, Compass

and the stewardship of our business,

on behalf of all our stakeholders.

Chris Sinclair

Chair

Reckitt Benckiser Group plc

21 March 2024

65 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose

OUR BOARD

The Board of Reckitt: experienced,

diverse andbalanced

Biographical details of the Directors

asat31 December 2023.

Nationality American

Appointment

Appointed as a Non-Executive Director in February

2015 and as Chair of the Board and Nomination

Committee in May 2018. Chris will retire as Chair

andfrom the Board following the Company’s

AnnualGeneral Meeting in May 2024.

Skills and competencies

Chris brings strong leadership skills and

valuable strategic insight to the Board,

through his experience as CEO and Chair of

other large companies. He also has a strong

understanding of international consumer-

focused businesses. He is the former Chair and

CEO of Mattel, Inc. and previously served as

CEO for various companies including Caribiner

International, Quality Food Centers, Pepsi-Cola

Co. and PepsiCo Foods and Beverages.

Current external appointments

None

Nationality Danish

Appointment

Appointed as Chief Executive Officer (CEO)

Designate on 1 May 2023, an Executive Director on

1 June 2023 and became CEO on 1 October 2023.

Skills and competencies

Kris has strong leadership and transformation

experience with a proven track record in delivering

growth and driving performance. He has in-depth

knowledge of the consumer goods sector.

Krisjoined Reckitt in November 2019 as Chief

Transformation Officer and in July 2020 became

President Health & Chief Customer Officer.

PriortoReckitt, he has held a number of senior

strategic and operational positions at PepsiCo

andwas a Partner at McKinsey & Company working

in the consumer, health and retail practices.

Current external appointments

Board member of the Consumer Brands Association

Committee Key

Chair

Nomination

Remuneration

Audit

Corporate Responsibility,

Sustainability, Ethics and Compliance

Chris Sinclair (73)

Chair of the Board

Kris Licht (47)

Chief Executive Officer

N R C C

can be found at reckitt.com/our-company/our-leadership/.

Detailed Board members biographies

Nationality British

Appointment

Appointed as Senior Independent Director and

amember of the Remuneration and Nomination

Committees in November 2022. Sir Jeremy

willbecome Chair of the Board following the

Company’s Annual General Meeting in May 2024.

Skills and competencies

Jeremy is an outstanding leader with considerable

expertise in the consumer retail environment.

He has a proven track record of driving business

performance and a unique insight into what

motivates consumers. He is the former Executive

Chairman and Group CEO of Sky and prior to that

was Group Finance Director of DSG International

plc. He has also held board positions with Burberry

Group plc and Marks and Spencer Group plc.

Current external appointments

Director of The Walt Disney Company

Chair, National Oceanography Centre

WWF Ambassador

Non-Executive Director of Ahren Acquisition Corp

Sir Jeremy Darroch (61)

Senior Independent Director

N R

66 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

Nationality American

Appointment

Appointed as CFO Designate on 17 October 2023

and will become CFO in March2024.

Skills and competencies

Shannon brings extensive experience across the

consumer and retail sectors, having worked with

some of the most globally recognised brands.

Shannon held multiple senior management roles

atNIKE, Inc., including as CFO of the NIKE Consumer,

Marketplace and Brand segment. Prior to that,

Shannon had spent almost two decades at Procter

& Gamble in a range of finance roles. Shannon

isaproven strategic and operational leader with

a track record of building highly successful teams

and delivering strong and consistent performance.

Current external appointments

None

Shannon Eisenhardt (49)

Chief Financial Officer Designate

A N

Nationality British

Appointment

Appointed as a Non-Executive Director in February

2015 and as Chair of the CRSEC Committee in

July2016. Pam will retire from the Board following

the Company’s Annual General Meeting in May 2024.

Skills and competencies

Pam brings to the Board extensive knowledge of

the healthcare sector and a wealth of international

business and pharmaceutical experience.

These skills are highly valuable toher role as

Chair of the CRSEC Committee. She has served

as Chair of SCYNEXIS, Inc., CEO of Quintiles

Transnational Corporation and held senior

positions in the international healthcare industry

at AstraZeneca plc and Hoffman-LaRoche.

Current external appointments

Non-Executive Director of Bunzl plc

Member of the Supervisory Board of AkzoNobel N.V.

Pam Kirby (70)

Non-Executive Director

Nationality British

Appointment

Appointed as a Non-Executive Director in July 2018

and as Chair of the Audit Committee in January

2019. Andrew will become Senior Independent

Director following the Company’s Annual General

Meeting in May 2024.

Skills and competencies

Andrew brings more than three decades of

financial expertise to the Board. He is a strong

leader, with experience gained in large, complex

organisations and has a history of driving strong

financial performance in the UK and globally.

These skills are valuable to the Board and to his

role as Chair of the Audit Committee. He is CFO

of Caterpillar Inc., was Group CFO of National

Grid plc, CFO of Cadbury plc and Executive

VicePresident and CFO at Bristol Myers Squibb.

Current external appointments

Chief Financial Officer of Caterpillar Inc.

Andrew Bonfield (61)

Non-Executive Director

C N A

Nationality British

Appointment

Appointed as Chief Financial Officer (CFO)

inApril2020. Jeff will step down as CFO in

March2024 and will retire as an Executive Director

on31 March2024.

Skills and competencies

Jeff brings extensive experience across

consumer and retail companies. He has a record

of transformational, strategic and operational

leadership, consistent performance delivery

and strong capital allocation discipline. Prior

to Reckitt, he was the CFO and Management

Board member at Ahold Delhaize, CFO of First

Group plc and easyJet plc and held senior

finance roles at Associated British Foods plc.

Current external appointments

Chair of the Audit Committee and Non-Executive

Director of Kingfisher plc

Jeff Carr (62)

Chief Financial Officer

67 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

Nationality Italian/British

Appointment

Appointed as a Non-Executive Director in July 2020.

Skills and competencies

Margherita has extensive experience of financial

markets and digital technologies. She is an

experienced leader in business in both developed

and developing markets. Margherita is Chief

Executive Officer of Vodafone Group plc and

prior to that held numerous senior finance roles

within the business including as Chief Financial

Officer. These skills, together with her strong

leadership background, are valuable to the Board

and her membership of the Audit Committee.

Current external appointments

Chief Executive Officer of Vodafone Group Plc

Nationality British/Dutch

Appointment

Appointed as a Non-Executive Director in

February2015. Mary was Chair of the Remuneration

Committee from November 2017 to May 2022, and

will resume that role following the Company’s AGM

in May 2024. Mary has been the Designated NED for

Engagement with the Company’s Workforce since

July 2019.

Skills and competencies

Mary has substantial experience in consumer

and retail businesses across China, Southeast

Asia and Europe. She brings to the Board a top-

level strategic outlook, with an international and

consumer focus. Her previous experience in other

Non-Executive Director roles, and as Chair of

other Remuneration Committees, is invaluable

tothe Board and the Remuneration Committee.

Current external appointments

Non-Executive Director of Coca-Cola Europacific

Partners plc

Supervisory Director of HAL Holding N.V.

Margherita Della Valle (58)

Non-Executive Director

Mary Harris (57)

Designated Non-Executive Director for

Engagement with Company’s Workforce

Nationality British

Appointment

Appointed as a Non-Executive Director in February

2022 and as Chair of the Remuneration Committee

in May 2022. Alan will retire from the Board following

the Company’s AGM in May 2024.

Skills and competencies

Alan brings to the Board significant corporate

finance and accounting experience from a variety

of industries, including retail, banking and travel,

as well as executive leadership experience

within a listed company environment. He was

CFO of Tesco PLC where he played a key role in

the turnaround of Tesco. Prior to this he was also

CFO of Marks and Spencer Group plc, CFO of

AWAS, Group Finance Director of WH Smith PLC

and CEO and CFO of Thomas Cook Holdings.

Current external appointments

Non-Executive Director of Diageo plc

Non-Executive Director of Burberry Group plc

Alan Stewart (63)

Non-Executive Director

R C

Nationality French

Appointment

Appointed as a Non-Executive Director

inJanuary2021.

Skills and competencies

Olivier is a successful leader, with many years’

experience as CEO of a large, global company.

Olivier has a wealth of experience in healthcare

products and markets and brings great insight

to the Board. He was the CEO of Smith &

Nephew plc and of healthcare, cosmetology

and pharmaceutical company Laboratoires

Pierre Fabre, and Corporate Executive Vice

President of Abbott Laboratories and President

of their pharmaceutical products division.

Current external appointments

Chairman of Majorelle

External Director of Takeda Pharmaceutical

Company Limited

Co-Founder and Board member

ofAlgoTherapeutixSAS

Olivier Bohuon (65)

Non-Executive Director

RR N

68 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

Nationality American

Appointment

Appointed as a Non-Executive Director

inSeptember 2018.

Skills and competencies

Elane has held various senior leadership positions

including Chief Executive Officer of ServiceMaster

Brands, Group President at Kimberly-Clark

International and Kimberly-Clark Professional and

as a director and member of the Audit Committee

of Yum Brands! and Equifax. Elane brings great

sector-relevant experience and insight of consumer

goods products to the Board, particularly in

personal care and wellness. She also brings key

knowledge of emerging markets and the changing

channels of trade and consumer preferences.

Current external appointments

None

Nationality American

Appointment

Appointed as a Non-Executive Director

inFebruary2024.

Skills and competencies

Marybeth has over 25 years of experience in the

retail, healthcare and consumer goods sectors. She

has held various senior roles at Walmart, including

as Executive Vice President of Consumables and

Health & Wellness for Walmart U.S. and as Chief

Merchandising, Marketing and Supply Chain Officer

for Walmart China. Marybeth was previously Vice

President of Marketing at HanesBrands, Inc.

Current external appointments

Director and member of Audit Committee of

JOANN Stores, Inc.

Board member of Decowraps

Fiona Dawson CBE will join the Board as a

Non-Executive Director and as Chair Designate

tothe Remuneration Committee effective

1 June2024. Fiona’s full biography will be available

on our website upon her appointment.

Elane Stock (59)

Non-Executive Director

Marybeth Hays (55)

Non-Executive Director

Nationality British

Appointment

Appointed as a Non-Executive Director

inFebruary2023.

Skills and competencies

Tamara has had an extensive career in advertising,

marketing and digital communications and has a

deep understanding of consumer brands and digital

strategy. She was Global Chair of Wunderman

Thompson and also held various leadership roles

at WPP plc. She also served as CEO of McCann

Worldgroup and Saatchi & Saatchi in London.

Current external appointments

Non-Executive Director of Marks and Spencer

Group plc

Non-Executive Director of Intertek Groupplc

Non-Executive Director of Marsh & McLennan

Companies, Inc.

Tamara Ingram, OBE (61)

Non-Executive Director

Nationality American/British

Appointment

Appointed as a Non-Executive Director in July 2018.

Skills and competencies

Mehmood is a highly skilled medical practitioner

and researcher. Mehmood has been Chief

Executive Officer of Hevolution Foundation since

October 2020. He was previously CEO of Life

Biosciences Inc., and before that served as Vice

Chairman and Chief Scientific Officer, Global

Research and Development at PepsiCo Inc. He

has extensive experience in both developing

and developed markets, adding value to the

CRSEC Committee through his knowledge

of creating sustainable initiatives and past

experiences of leading research and development

efforts to create breakthrough innovations.

Current external appointments

Chief Executive Officer of Hevolution Foundation

Executive Chairman of Life Biosciences Inc.

Chairman of VCAT, US National Institute

ofStandards and Technology

Mehmood Khan (65)

Non-Executive Director

Other Directors who served during the year

Nicandro Durante, Non-Executive Director from

December 2013, was appointed as Chief Executive

Officer from October 2022 until October 2023 and

stayed on as Executive Director until his departure

in December 2023.

69 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

GROUP EXECUTIVE

COMMITTEE

210

211 212

Nationality Danish

Key skills and experience

Kris has strong leadership and transformation

experience with a proven track record in delivering

growth and driving performance. He has in-depth

knowledge of the consumer goods sector.

Kris joined Reckitt in November 2019 as Chief

Transformation Officer, and in July 2020 became

President Health & Chief Customer Officer.

Prior to Reckitt, he has held a number of senior

strategic and operational positions at PepsiCo,

andwas a Partner at McKinsey & Company working

in the consumer, health and retail practices.

Nationality American

Key skills and experience

Shannon joined Reckitt as CFO Designate in

October 2023 and will become CFO in March 2024.

Shannon brings extensive experience across the

consumer and retail sectors, having worked with

some of the most globally recognised brands.

Shannon held multiple senior management roles at

NIKE, Inc., including as CFO of the NIKE Consumer,

Marketplace and Brand segment. Prior to that,

Shannon had spent almost two decades at Procter

& Gamble in a range of finance roles. Shannon is

a proven strategic and operational leader with a

track record of building highly successful teams

and delivering strong and consistent performance.

Nationality British

Key skills and experience

Jeff joined Reckitt as Chief Financial Officer in April

2020. Prior to that, he was CFO and Management

Board member at Ahold Delhaize, and held

the role of CFO at First Group plc and easyJet

plc. Jeff brings extensive experience across

consumer and retail companies. He has a record

of transformational strategic and operational

leadership, consistent performance delivery

and strong capital allocation discipline. Jeff will

step down as CFO in March 2024 and will retire

as an Executive Director on 31 March 2024.

Nationality German/Swiss

Key skills and experience

Volker joined Reckitt in August 2020 as Chief

Transformation Officer, and in May 2021 became

President Hygiene. As well as leading the Hygiene

BU’s global team, he has additional responsibility

for New Growth Platforms, a cross-BU initiative.

Prior to joining Reckitt, Volker spent 26 years with

Procter & Gamble in a range of international finance,

marketing, and senior general management roles.

Kris Licht (47)

Chief Executive Officer

Shannon Eisenhardt (49)

Chief Financial Officer Designate

Jeff Carr (62)

Chief Financial Officer

Volker Kuhn (56)

President Hygiene

can be found at reckitt.com/our-company/our-leadership/.

Detailed Executive Committee members biographies

70 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

25 27

29 211 212

26 28

210

Nationality American

Key skills and experience

Pat joined Reckitt in 2017 as part of the Mead

Johnson Nutrition acquisition. He was appointed

as Chief Operating Officer, Nutrition in July

2021, as President Nutrition in February 2022

and as President Health in July 2023. Pat has

more than 20 years of experience in senior

leadership roles in general management,

marketing and sales across North America,

Europe, Asia Pacific and Latin America.

Nationality British

Key skills and experience

Ranjay joined Reckitt as Chief Human Resources

Officer in March 2020. Ranjay has over 30 years’

experience in the human resources function

across different geographies and industries.

Prior to joining Reckitt, Ranjay was the Chief

Human Resources Officer at InterContinental

Hotels Group plc and spent over two decades

at Unilever in senior leadership roles.

Nationality French

Key skills and experience

Sami joined Reckitt as Chief Supply Officer

in July2020. He is responsible for global

supply chain operations, including planning,

procurement, manufacturing and logistics.

Sami will be leaving Reckitt in July, to be

succeeded by Harald Emberger, previously

Chief Supply Chain Officer at Beiersdorf AG.

Nationality Italian

Key skills and experience

Filippo joined Reckitt as Chief Information

& Digitisation Officer in April 2021. Filippo is

responsible for building and maintaining Reckitt’s

IT, Data and Digital capabilities. Filippo brings

to Reckitt extensive leadership experience in

defining and shaping IT, digital portfolios and

technology-enabled new business models

across leading consumer goods organisations.

Nationality American

Key skills and experience

Catheryn joined Reckitt in February 2022 and

isresponsible for legal and compliance matters

across the Group. She brings to Reckitt more

than 20 years of professional expertise in

running global legal and compliance teams,

managing litigation and corporate transactions,

advising on financial reporting and disclosure

as well as supporting Board governance.

Nationality American

Key skills and experience

Susan joined Reckitt as President Nutrition in July

2023. Susan brings to Reckitt a deep knowledge

of the Nutrition business, having previously

worked for over 11 years at Mead Johnson

Nutrition and Reckitt in a number of senior

leadership roles in the US and Europe, including

general management, marketing and sales.

Nationality French

Key skills and experience

Fabrice joined Reckitt in 1999 and the GEC in April

2022. Since joining the Company he has worked

internationally in senior leadership roles across

marketing and general management. He oversees

the Marketing Centres of Excellence and the

Sustainability and Corporate Affairs functions.

Heis responsible, amongst others, for reimagining

and scaling Reckitt’s playbook for digitally led,

sustainable and profitable growth. Fabrice is

agraduate of EM Lyon Business School, France.

Nationality American

Key skills and experience

Angela joined Reckitt as Chief R&D Officer in

September 2020 and is responsible for elevating

Reckitt’s science capability and platforms aswell

as for driving external partnerships. Sheisfocused

on enabling the R&D organisation to deliver

meaningful solutions addressing the mega

trends and sustainability to deliver growth.

Pat Sly (47)

President Health

Ranjay Radhakrishnan (53)

Chief Human Resources Officer

Sami Naffakh (53)

Chief Supply Officer

Filippo Catalano (51)

Chief Information & Digitisation Officer

Catheryn O’Rourke (51)

General Counsel & Company Secretary

Susan Sholtis (57)

President Nutrition

Fabrice Beaulieu (50)

Chief Marketing, Sustainability and

Corporate Affairs Officer

Angela Naef, PhD (48)

Chief R&D Officer

Other Group Executive Committee members who served in the year

Nicandro Durante, Non-Executive Director from December 2013, was appointed as Chief Executive

Officer from October 2022 until October 2023 and stayed on as Executive Director until his departure

inDecember 2023.

71 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

The Board is responsible for the effective

leadership of the Group and for promoting

itslong-term sustainable success, generating

value for shareholders and contributing to wider

society, whilst focusing on governance with the

highest regard to the principles of the Code.

The Board provides leadership by setting our

Purpose, strategy and values, monitoring our

culture and ensuring alignment with our Purpose

and Compass, and overseeing implementation by

management. All Directors must act with integrity,

lead by example and promote the Company’s

culture and values. The Board also ensures there

are appropriate processes in place to manage

risk, including the Company’s risk appetite and

monitors financial and operational performance

against objectives. The Board consists of a

balance of Executive and Non-Executive Directors

who together have collective accountability to

Reckitt’s shareholders as well as responsibility

for the overriding strategic, financial and

operational objectives and direction of Reckitt.

The Board manages the overall leadership of the

Group with reference to its formal Schedule of

Matters Reserved for the Board. This schedule is

reviewed annually, with the last review undertaken

in November 2023, and broadly covers:

– Matters which are legally required to be

considered or decided by the Board, such

asapproval of Reckitt’s Annual Report and

Financial Statements, declaration of dividends

and appointment of new Directors

– Matters recommended by the Code to be

considered by the Board, such as terms of

reference for the Board and its Committees,

review of internal controls and risk management

– Compliance with regulations governing

UKpublicly listed companies, such as the UK

Listing Rules, the Disclosure Guidance and

Transparency Rules and the Prospectus

Regulation Rules

– Matters relating to developments in, or changes

to, the Group’s strategic direction, or material

corporate or financial transactions

is available on the Reckitt website at

reckitt.com/investors/corporate-governance.

The full Schedule of Matters Reserved for the Board

RECKITT’S APPROACH

TOGOVERNANCE

72 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Nomination Committee

Chaired by Chris Sinclair

Responsible for making

recommendations to the Board on

suitable candidates for appointment

to the Board, its Committees and

senior management and to regularly

review and refresh their composition

to ensure that they comprise a

diverse group of individuals with

the necessary skills, knowledge and

experience to effectively discharge

their responsibilities, whilst keeping

in mind the importance of diversity.

Audit Committee

Chaired by Andrew Bonfield

Responsible for monitoring the

integrity of Reckitt’s Financial

Statements and for ensuring

effective functioning of internal

audit, internal controls and risk

management. It is also responsible

for managing the Company’s

relationship with its External Auditor.

Remuneration Committee

Chaired by Alan Stewart

Responsible for assisting the Board

in fulfilling its oversight responsibility

by ensuring that the Remuneration

Policy and practices reward fairly and

responsibly, are linked to corporate

and individual performance and take

account of the generally accepted

principles of good governance.

The Committee is responsible for

determining the remuneration for

theChair, Executive Directors and

senior management.

CRSEC Committee

Chaired by Pam Kirby

Responsible for supporting the

Board in reviewing, monitoring and

assessing the Company’s approach

to responsible, sustainable, ethical

and compliant corporate conduct

and to assist the Board in upholding

its Compass.

Board Leadership and Company Purpose continued

Governance structure

The Company has a clear and effective

governance structure, which allows the Board,

its Committees and the Executive team to make

decisions effectively. The Board has established

four Committees to assist in the execution of its

responsibilities. Each Committee operates under

terms of reference approved by the Board. The

terms of reference are reviewed regularly, with

the last review taking place in November 2023.

There are also three supporting Management

Committees: the Disclosure Committee, the

Group Executive Committee (GEC), and the Risk,

Sustainability & Compliance Committee (RSCC).

Disclosure Committee

Chaired by CFO

Responsible for

ensuring accuracy and

timeliness of disclosure

of financialand other

publicannouncements.

Group Executive Committee

Chaired by CEO

Responsible for overseeing Reckitt’s management and ensuring

collaboration between GBUs, functions and in-market operations.

It recommends and implements the strategy and related budget

as approved by the Board. The GEC drives business and cultural

transformation, reviews business performance and approves business

development plans and major investments. It plays a critical role in

talent management and development and oversees the integration

ofsustainability within business operations.

Risk, Sustainability &

Compliance Committee

Chaired by CEO

Provides oversight of risk across the organisation and

makes recommendations to the CRSEC Committee

for actions to be taken in respect of the Group’s legal

compliance and ethics, sustainability, external affairs,

employee health and safety, quality, consumer safety

and regulatory matters, including compliance strategies,

policies, programmes and key activities.

for more details in the

Nomination Committee Report.

See pages 83-87

for more details in the

Audit Committee Report.

See pages 88-95

for more details in the

Remuneration Committee Report.

See pages 100-132

for more details in the

CRSEC Committee Report.

See pages 96-99

Our Board

The Board is collectively responsible for the overall leadership of the Group and for promoting its long-term sustainable success whilst focusing on its strategic

direction, Purpose, values and governance with the highest regard to the principles of the Code. There is a clear division of responsibilities between the Board,

itsCommittees and Management Committees.

Shareholders

Our shareholders are the ultimate owners of the Company and play an important role in the governance structure. Further information on our engagement with

shareholders can be found on page 39.

73 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

How we manage conflicts of interest

Directors have a duty to avoid interests, director

indirect, which might conflict with the interests

of the Group. Under the terms of our Articles,

such conflicts can be authorised by the Board.

Procedures are in place to manage and, where

appropriate, approve such conflicts. Any

authorisations granted by the Board are recorded

by the General Counsel & Company Secretary

in a Register of Conflicts, together with the

date on which the conflict was authorised. Any

conflicts authorised during the year are reviewed

annually by the Nomination Committee and the

Board. In addition, each Director certifies on

an annual basis that the information contained

in the Register of Conflicts is correct.

The Company indemnifies the Directors and

Officers of the Company and any Group subsidiary

to the extent permitted by law in respect of the

legal defence costs for claims against them and

third-party liabilities. The indemnity would not

provide cover for a Director or Officer if that

individual was found to have acted fraudulently

or dishonestly. Additionally, Directors’ and

Officers’ liability insurance cover was maintained

throughout the year at the Company’s expense.

How Board meetings are structured

Board meetings are conducted in an open

atmosphere conducive to challenge and debate.

Agendas are tailored to the requirements

of the business and agreed in advance by

the Chair and CEO with the support of the

General Counsel & Company Secretary.

The Board receives operating and financial reports

from the CEO and CFO on strategic and business

developments, as well as financial performance

and forecasts at each meeting. Specific

presentations are also made by non-Board

members on material matters to the Group.

Inaddition, the Chairs of the Audit, Remuneration,

CRSEC and Nomination Committees update the

Board on the proceedings of those meetings,

including key topics and areas of concern.

At the conclusion of every scheduled Board

meeting, the Chair holds a session with the

other Non-Executive Directors, without

the Executive Directors present, providing

further opportunity for the Non-Executive

Directors to assess the performance of

management and individual Executive Directors

and help drive future agenda items.

The Board uses its meetings as a way of

discharging its responsibilities, including

as set out in section 172 of CA 2006 to

promote the success of the Company for

the benefit of its members as a whole.

Board and Committee meeting attendance

In 2023, there were five scheduled Board

meetings. The October Board meeting was a

strategy session held in person in New Jersey,

USA to allow the Board to immerse itself in

the Group’s operations, to visit local sites and

meet the local workforce. During the three-day

meeting, the Board received presentations on

the Company’s strategy, including deep dives

into each GBU, innovation, supply and IT &

Digital strategy. The Board also met informally

with senior leadership from the US team and

hosted employee engagement sessions.

The table opposite sets out the attendance by

Directors at scheduled Board and Committee

meetings that each Director was eligible to

attend. Directors who were not members

of individual Board Committees were also

invited to attend one or more meetings

of those Committees during the year.

Where a Director is unavoidably absent from a Board or Committee meeting, they still receive and

reviewthe papers for the meeting and may provide verbal or written input ahead of the meeting,

usuallythrough the Chair of the Board or the Chair of the relevant Committee, so that their views

areconsidered at the meeting.

Board

Audit

Committee

Remuneration

Committee

CRSEC

Committee

Nomination

Committee

meetings

Andrew Bonfield 5 of 5 4 of 4 2 of 2

Olivier Bohuon 4 of 5 2 of 3 3 of 4

Jeff Carr 5 of 5

Jeremy Darroch 5 of 5 4 of 4 3 of 3 2 of 2

Margherita Della Valle 4 of 5 3 of 4

Nicandro Durante

4 of 5

Shannon Eisenhardt

1 of 1

Mary Harris 5 of 5 3 of 3

Tamara Ingram 5 of 5 4 of 4

Kris Licht

3 of 3

Mehmood Khan 5 of 5 4 of 4

Pam Kirby 5 of 5 4 of 4 4 of 4

Chris Sinclair 5 of 5 3 of 3 4 of 4 2 of 2

Alan Stewart 5 of 5 3 of 3 2 of 2

Elane Stock 5 of 5 4 of 4

1. Nicandro Durante resigned from the Board on 31 December 2023

2. Shannon Eisenhardt was appointed to the Board on 17 October 2023

3. Kris Licht was appointed to the Board on 1 June 2023

74 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Stakeholders

Customers People Partners Communities

Government and

industry associations

Consumers Shareholders

Our activities during the year

FEBRUARY MEETING

– Approval and publication of Full Year Results

– Approval and publication of Annual

Report2022

– Consideration of Full year dividend proposal

JULY MEETING

– Approval and publication

ofHalfYearResults

– Consideration of Interim

dividendproposal

AGM

– In person engagements

withshareholders and Q&A

– AGM resolutions proposed

toshareholders

MAY MEETING

– Review of Sustainability Strategy

– Approval of Modern Slavery

ActStatement

Strategy

Group plans and budgets

– Reviewed the Group’s financial plan

for2024and individually for the GBUs

– Reviewed forecasts and business

performance

Strategy

– Board members met in person for a

three-day meeting in October 2023 to

discuss strategy and the innovation pipeline

– Reviewed strategy for each GBU, supply

chain and IT & Digital function

– Received updates on competitive

environment and broader

marketdevelopments

Mergers and acquisitions

– Oversight of potential merger and

acquisitions (M&A) activities and

portfoliostrategy

Business updates

– Review of GBU business performance

– Deep dives on functions such as Finance,

HR,Supply, IT & Digital and Cyber

Board Leadership and Company Purpose continued

2023 BOARD ACTIVITIES

Governance and Oversight

Board and Committee performance review

– Conducted the annual Board performance

review and had oversight of Committee

performance reviews. Identified areas for

improvement and recommended actions

– Considered and proactively addressed

actions from the 2022 Board

performancereview

Talent, succession and board composition

– Oversight of Group talent planning and

succession, including senior management

succession and retention

– Considered and approved Board changes,

including the appointment of Chair, CEO,

CFO, SID and new Non-Executive Directors

as detailed on pages 83 to 87

Shareholders and stakeholders

– Held the 2023 AGM as a physical meeting.

Shareholders had the opportunity to

pre-submit questions as well as ask them

during the meeting

– Held Board and employee engagement

meetings, to understand employee views,

aspart of October strategy meetings

Compliance

– Reviewed and approved governance

matters, such as the Schedule of Matters

Reserved for the Board, Committee terms of

reference, Directors’ conflicts of interest and

compliance with the Code and best practice

– Kept abreast of upcoming changes in the

UKcorporate governance and regulatory

framework

– Approved Reckitt’s 2022 Modern Slavery

andHuman Trafficking Statement, as

recommended by the CRSEC Committee

75 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Our activities during the year

SITE VISIT

– Board visit to R&D facility and review of

R&D functional strategy

ESG Financial

– Reviewed the Group’s sustainability strategy

and approach, including progress against

thedelivery of our Sustainability Ambitions

Reporting

– Reviewed and approved Reckitt’s Annual

Report and Financial Statements including

compliance with reporting requirements

– Reviewed and approved Reckitt’s full-year,

half-year and quarterly results

– Provided results presentations to investors

and employees during the year

Going concern

– Reviewed long term going concern and

liquidity considerations

– Considered and approved the 2023

AnnualReport Viability Statement upon

recommendation of the Audit Committee

– Received updates on sustainability activities

and initiatives

Financial resources

– Reviewed the Company’s financial

position,Group debt and funding

arrangements and capital allocation

– Approved bond issuance

– Approved initiation of share

buybackprogramme

– Interim and final dividend payments

– Approved the final 2022 and

interim2023dividend payments

Treasury policies

– Reviewed and approved the Group’s

Treasury policies

Board Leadership and Company Purpose continued

Risk Management and Internal Controls

Principal and Emerging Risks

– Conducted an annual review of Reckitt’s

principal and emerging risks and

consideration of risk management approach

– Reviewing the appropriateness and

effectiveness of the system of internal

control and risk management

Stakeholders

OCTOBER MEETING

– Board three-day strategy sessions

– Board and employee engagement sessions

NOVEMBER MEETING

– 2024 Plan agreed

– Board performance review

LISTENING SESSIONS

– Conducted listening session on the

intersectionality of Health and Climate

Customers People Partners Communities

Government and

industry associations

Consumers Shareholders

Governments,

NGOs, Industry

&Academia

Communities

Suppliers &

partners

People

Consumers

Customers

Investors

Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

CEO appointment

In appointing Kris Licht as CEO, following

anextensive search which considered both

internal and external candidates, the Board

took account of the need to build on the strong

momentum in the business over the past three

years, Kris’ strong strategic and operational

leadership experience, as well as his in-depth

knowledge of Reckitt’s business, culture,

customers and other stakeholders, as well

asof the consumer goods sector generally.

CASE STUDY

This statement shows how our

Directors have acted in a way

thatthey consider, in good faith,

would be most likely to promote

thesuccess of the Company for

thebenefit of its members as a

whole during 2023, having regard

tostakeholders, including matters

under Section 172(1)(a)-(f) of the

Companies Act 2006.

Understanding the needs and expectations

of our stakeholders is fundamental to our

Purpose: to protect, heal and nurture in the

relentless pursuit of a cleaner and healthier

world. In making decisions, the Directors

consider what is most likely to promote the

success of the Company for its shareholders

in the long term, as well as the interests

of the Group’s other stakeholders.

We recognise that our business can only

grow and prosper by acting in the long-term

interests of our key stakeholders, namely

our people, our consumers and customers,

our shareholders, investors and partners, the

communities in which we operate and the

environment. Further information on our key

stakeholders can be found on pages 37 to 40.

The Board considers our key stakeholders and

the matters set out under Section 172 of the

CA2006 in its discussions and decision-making.

The following table sets out examples of how

the Board has considered matters under section

172 during the year in performing its duties.

Our stakeholders

Board Leadership and Company Purpose continued

SECTION 172

STATEMENT

How the Board engaged

withstakeholders: Page

Consumers

Customers

People

Suppliers & partners

Investors

Communities

Governments, NGOs,

Industry&Academia

Shareholder returns

The Board recognises the importance of

shareholder returns and, during the year,

increased both the 2022 final dividend

and the 2023 interim dividend by 5%.

InOctober, the Board also announced

a£1 billion share buyback programme.

Inannouncing this enhanced shareholder

returns programme, the Board tookaccount

of the Group’s strong free cash flow

generation, the views of shareholders,

and that capacity existed to return excess

capital to shareholders without impacting

the successful delivery of the business plan

or the Group’s capital allocation priorities.

77 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

(a) Considering long-term consequences

The Board strives to act in the long-term

interests of its key stakeholders, and this

frames its oversight of corporate strategy,

which is founded on creating long-term

shareholder value. Our Sustainability

Ambitions frame decision-making, and

provide important interim milestones

to 2030. These parameters, set by the

Board, are reflected within strategy

work and objectives, which extends

to: capital investment; Group budgets;

dividend plans; and future resourcing

requirements. Reckitt’s risk management

framework, including the Group’s Principal

Risks, further underpin the Board’s

long-term approach. The Board and its

Committees are responsible for risk

governance, and oversight is achieved

through several mechanisms including

strategy reviews, Committee meetings

and deep dives into selected risk areas.

(b, c) Fostering stakeholder relationships

Constructive two-way dialogue with

Reckitt’s key stakeholders, including

employees, customers and consumers,

investors, suppliers and partners,

governments and regulators, tracks

priorities and helps identify issues as

they arise. Strategic engagement with

stakeholders reflects the structure of

our business as one Group with three

autonomous business units with decision-

making authority. The Board creates the

right conditions for this approach by

setting Reckitt’s long-term direction,

overarching decision-making framework

and culture. This is in-line with the Board’s

own experience and understanding of

stakeholder needs, Reckitt’s Sustainability

Ambitions and engagement on the future

of the retail and consumer goods industry.

(d) Protecting communities and

theenvironment

We understand as a business the effects

our operations have on the environment and

the need to embed sustainability to create

positive impacts both for communities and

the wider society in which we operate, as

well as for our business. Our Sustainability

Ambitions to 2030 focus on our impact

through our purpose-led brands and

innovative products; sustaining a healthier

planet through our work on climate change,

natural resources and biodiversity; and

enabling a fairer society through our activity

in our own business and across our value

chain. The Board oversees and reviews

performance against Reckitt’s Sustainability

Ambitions and delegates regular oversight

of sustainability to the CRSEC Committee.

(e, f) Setting culture and conduct

The Board is responsible for monitoring

Reckitt’s culture and values, and the delivery

of our strategy can only be achieved with

the highest standards of business conduct.

All Directors must act with integrity, lead

by example, and promote the Company’s

culture and values. We aim to create

the space and opportunities to help our

employees make a difference and do the

right thing, always. The CRSEC Committee

reports to the Board after each of its

meetings, to provide an update on Reckitt’s

ethics and compliance priorities, including

the Group’s Speak Up programme.

Relevant s172(a) disclosures

Our Strategy

8-11

Board activities

andgovernance

71-75

Focus on risk management

Relevant s172(b, c) disclosures

Reckitt’s decision-making

framework

Stakeholder engagement

andactions

37-40

Relevant s172(d) disclosures

Sustainability Ambitions

Progress Overview and

Performance Review

47-54

Audit Committee report

88-95

CRSEC Committee report

96-99

Climate-related

FinancialDisclosures

218-222

Relevant s172(e, f) disclosures

Board oversight/focus on

culture and ethical conduct

96-99

Reckitt’s approach to DE&I,

health, safety and wellbeing

19-21

112-114

Board Leadership and Company Purpose continued

78 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

Risk Appetite

The Board is responsible for compliance with

the Code and the Financial Reporting Council’s

(FRC) Guidance on Risk Management, Internal

Control and Related Financial and Business

Reporting. The sectors and environment within

which Reckitt operates are dynamic and fast-

moving, and in some areas, highly regulated, and

so controls are kept under review. The system

is designed to assess and manage, rather than

eliminate, risks to our business objectives. The

Board relies on these controls insofar as they are

able to provide reasonable, but not absolute,

assurance against material misstatement or loss.

The Group’s principal and emerging risks and

mitigating actions are detailed on pages 55 to 60.

As part of our risk management process,

weregularly evaluate risks to achieving objectives,

and the likelihood of such risks materialising and

impacting the ability of the Group to cope with

the circumstances should they occur. In doing so,

we are inherently considering our risk appetite

through the actions taken, controls implemented

and processes followed to reduce the likelihood

of risk events taking place, mitigating the

potential impact and ensuring that the cost

ofdoing so is proportionate to the benefit gain.

Principal risks

Reckitt is committed to maintaining strong

internal controls and further enhancing

these. Further information on internal control

activities during the year can be found on

page 94 of the Audit Committee Report.

Functional and operational management meet

todiscuss performance measured against

strategic aims and goals, with risks and risk

controls incorporated into the discussions.

During the year, the Directors undertook a robust

assessment of the principal and emerging risks

facing the Group, including those that could

threaten our business model, future performance,

solvency and liquidity. Each principal and emerging

risk is overseen by the Board, or a designated

Committee of the Board, and is subject to formal

deep-dive reviews as appropriate at Board, GEC

and GBU meetings. More details on the Group’s

principal strategic risks and uncertainties can be

found in the Strategic Report on pages 55 to 60.

Risk management and internal controls

The Audit Committee, on behalf of the Board,

oversees the Group’s overall Risk Management

Framework, the effectiveness of internal controls

and monitors Reckitt’s compliance with the

requirements of the Code in respect of risk

management and internal controls. The Audit

Committee monitored the key elements of the

Group’s internal controls framework throughout

the year and conducted an annual review of

the effectiveness of Reckitt’s system of risk

management and internal control in respect of

2023, which covered all material controls, including

financial, operational and compliance controls. The

Audit Committee’s annual review was supported by

a report prepared by the Internal Audit function on

the Group’s risk management and internal controls.

On an ongoing basis, the Board reviews the

effectiveness of the Group’s risk management

and internal control system, including through

monitoring reports from management on their

assessment of risks and internal control systems,

assurance received from management regarding

compliance with relevant policies, and assurance

received on the effectiveness of the Company’s

internal control environment. In addition, the Board

reviews reports from the Audit Committee, the

Internal Audit function and the External Auditor,

the Company’s response to incidents and threats,

including those relating to cybersecurity and

safety. The Board reviewed information gathered

from the Company’s formal Speak Up programme

including the results of an investigation conducted

in two Middle Eastern markets (see page 93). It

also considers the External Auditor’s observations

on the financial control environment.

In particular, the Audit Committee monitored

progress against Reckitt’s ongoing controls

transformation programme to strengthen internal

control over financial reporting. The Group’s

financial controls transformation programme is

intended to increase the overall level of control

environment maturity and improve consistency

across the Group. During 2023, it reviewed the

results of testing performed by the internal

controls and Internal Audit teams to confirm

the effective operation of key financial controls

across the Group, in particularly following the

launch of the Group’s revised financial control

framework during the year. More details on the

financial control framework can be found in the

Audit Committee Report on page 94. The Audit

Committee also continues to monitor progress

in relation to IT General Controls and technology

security and control initiatives, with regular

updates from the Chief Information and Digitisation

Officer and on the related assurance programmes.

Where areas for improvement are identified, the

Audit Committee is updated regularly with respect

to progress on those remediation activities as

well as reviewing ongoing control improvements

identified. It is recognised that improvements

will be ongoing through 2024 and the Audit

Committee will continue to support management

and review the remediation activities to monitor

that management have the appropriate resources

and an appropriate remediation timeline is in place.

Climate-related risk and environmental,

socialand governance (ESG) matters

The Board oversees, considers and reviews

the Group’s ESG strategy and has oversight

of climate-related risks and opportunities.

As part of the Board’s annual review of our

principal and emerging risks, sustainability was

considered. The Board’s focus included, both ESG

performance and reporting. More information

on our Sustainability Ambitions can be found on

pages 47 to 54. Our Climate Related Financial

Disclosures can be found on pages 218–222.

The CRSEC Committee supports the Board in

reviewing, monitoring, and assessing our approach

to sustainability, which includes climate change.

The CRSEC Committee reports to the Board

regularly at Board meetings, providing an update

on sustainability objectives and progress against

our targets. Further details on the activities of the

CRSEC Committee can be found on pages 96 to 99.

FOCUS ON RISK

MANAGEMENT

79 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Board Leadership and Company Purpose continued

Reckitt is rooted in a culture that is purpose driven,

innovative and entrepreneurial. Our leadership

behaviours unite us through a shared ambition

to Own, to Create, to Deliver and, above all,

toCare about the outcomes we deliver. Doing

the right thing, always, is at the centre of our

Compass, which guides our business and the

leadership behaviours that drive our success.

Our people are what makes Reckitt unique.

They believe in and are inspired by our Purpose.

During the last four years, we have established

deep cultural foundations that empower our

people as the key value drivers of our business.

We redefined our leadership behaviours to place

a greater emphasis on care as we serve the

needs of all our stakeholders. We elevated the

importance of teamwork in delivering outcomes

and protecting against the pursuit of results at

any cost. More information on our culture can be

found on pages 19 to 21 of the Strategic Report.

How the Board monitors culture

A key focus of the Board is to monitor culture

and ensure alignment between our Purpose,

values, and behaviours. Our culture and

values at Reckitt are defined by the Board

and the GEC. Regular interactions with

employees help the Board monitor culture

and are detailed in the table opposite.

How we monitor culture Board interactions and engagement to monitor culture throughout the year

Connecting directly

withemployees

Board members meet with employees regularly. As part of this year’s October Board meeting schedule, Board members met

informally with senior leadership from the US and hosted employee engagement sessions. The Board reviewed feedback

from the round-table discussions. In her role as Designated NED for Engagement with the Company’s Workforce, Mary Harris

attended meetings where employees were able to speak directly with Mary. The Board received feedback from Mary on

these discussions. Further information on Mary’s role as Designed NED for Engagement with the Company’s Workforce can

befound on pages 38 and 80.

Monitoring employee

perceptions

Regular global all-employee surveys include questions to gauge employees’ perceptions and understanding of leadership,

inclusion and wellbeing at Reckitt, and identify areas which require greater attention. This year’s survey highlighted that

employees would recommend Reckitt as a place to work; believe in and are inspired by our Purpose to protect, heal and

nurture in the relentless pursuit of a cleaner, healthier world; are proud to work for Reckitt; and agreed that we are achievers.

Similar to last year, responses from the survey also identified areas that need further improvement, such as: removing barriers

that slow down work; transparency on equal opportunities and career progression; and investing in and developing people.

The Board will continue to monitor progress against these areas.

Creating a forum for

employees to be heard

Employee Resource Groups (ERGs) are employee networks that aim to raise the visibility of underrepresented communities.

They provide a space for colleagues to connect and support each other and are also represented on the Global Inclusion

Board. In addition, throughout the year, Mary Harris, the Designated NED for Engagement with the Company’s Workforce,

hasmaintained regular engagement with various employee groups, including the ERGs.

Ensuring employees

areinformed

Quarterly all-employee global live-streaming results broadcasts were held by the CEO, CFO and GBU leaders to present

ourresults and employees are invited to ask questions and interact directly with presenters.

Staying informed of legal

and compliance matters

At each Board meeting, the CRSEC Committee reports to the Board on legal compliance and ethics matters, including the

Group’s Speak Up programme, which provides safe communication channels for employees wishing to raise concerns on

potential violations of regulations, internal policies or any misconduct observed at Reckitt.

Maintaining open

communications

Following the Q3 2023 results announcement, a CEO chat was broadcast to update Reckitt employees on the continued

strategic direction beyond Q3 and provided employees with an opportunity to ask questions.

FOCUS ON

CULTURE

80 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Division of Responsibilities

Board roles and responsibilities

To ensure the Board performs effectively, there is

a clear division of responsibilities, set out in writing

and agreed by the Board, between the leadership

of the Board and the executive leadership of the

business. The key roles are defined in greater

detail on the following pages.

A full description of the roles and responsibilities

of the Chair, CEO and Senior Independent Director

can be found on our website: www.reckitt.com.

Managing time commitment and ‘overboarding’

On appointment, Non-Executive Directors are

made aware of the need to, and are required to

confirm that they will, allocate sufficient time

to their role to discharge their responsibilities

effectively. They are also required to seek

agreement from the Chair before taking on

additional commitments, and to declare any actual

or potential conflicts of interest. Non-Executive

Directors are engaged under the terms of a letter

of appointment. Initial terms of appointment are

for three years with three months’ notice, with all

Directors standing for election or re-election at

every AGM. The Board has reviewed the length of

service of each Director and considers that each

Non-Executive Director standing for re-election

or election at this year’s AGM is independent.

Inparticular, in relation to the reappointment

of Mary Harris as Chair of the Remuneration

Committee for a fixed term between the

HOW WE ARE

GOVERNED

Non-Executive

The Chair

– Leading the Board and taking responsibility

forthe Board’s overall effectiveness

indirecting the Company

– Upholding the highest standards of integrity

and ethical leadership, leading by example

andpromoting a culture of openness and

debate, based on mutual respect, both in

andoutside the boardroom and in line with

ourPurpose, values, strategy and culture

– Chairing Board, Nomination Committee

andshareholder meetings and setting

Boardagendas

– Encouraging constructive challenge and

facilitating effective communication between

the Board, management, shareholders and

wider stakeholders, while promoting a culture

of openness and constructive debate

– Ensuring an appropriate balance is maintained

between the interests of shareholders and

other stakeholders

– Leading the annual performance review

process for the Board and its Committees

andaddressing any subsequent actions

– Promoting the highest standards

ofcorporategovernance

– Building a well-balanced, diverse

andhighlyeffective Board

– Ensuring Directors receive accurate,

timelyandclear information

– Ensuring there are appropriate induction

anddevelopment programmes for all

Boardmembers

– Ensuring the long-term sustainability

oftheCompany

The Senior Independent Director

– Acting as a sounding board for the Chair

onBoard-related matters

– Acting as an intermediary for other Directors

as necessary

– Evaluating the Chair’s performance

onanannual basis

– Chairing Board and Nomination Committee

meetings in the absence of the Chair

– Being available to shareholders and

stakeholders to address any concerns that

they have been unable to resolve through

normal channels

– Leading the search and appointment process

for a new Chair, when necessary

Designated Non-Executive Director for Engagement with the Company’s Workforce

– Overseeing the Board’s engagement with

theCompany’s workforce together with

management, to understand more about

engagement and the culture of the Company

– Developing and implementing employee

engagement initiatives

– Providing an employee voice in the boardroom

and reporting on matters relating to Company

culture, purpose and improvements

Non-Executive Directors

– Providing independent input into Board decisions

through constructive challenge anddebate,

strategic guidance and specialist advice

– Setting and approving the Company’s long-term

strategic, financial and operational goals

– Examining the day-to-day management of the

business against the performance targets and

objectives set, ensuring that management

isheldto account

– Reviewing financial information and ensuring

itiscomplete, accurate and transparent

– Ensuring there are effective systems of internal

control and risk management and that these are

continually monitored and reviewed

– Setting appropriate levels of remuneration

forExecutive Directors and ensuring

performance targets are closely aligned

withshareholder interests

– Development of succession planning and the

appointment and removal of senior management

– Taking into account and responding

toshareholders’ views

81 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Division of Responsibilities continued

Company’s 2024 and 2025 AGMs, see page 64.

The Board considers all Non-Executive Directors

who served during the year to be independent.

Whilst both Chris Sinclair and Pam Kirby will have

served nine years in February 2024, the 2024 AGM

represents a natural point for them to stand down,

and enables smooth succession of their roles. The

period from February to the AGM is considered

sufficiently short not to impair their independence.

The Board and Directors are confident that each

Director individually has the expertise and relevant

experience required to perform the role of a

Director of a listed company and to contribute

effectively to the Board and Committees to which

they are appointed. The Company recognises

the developmental advantages of an external

non-executive role on a non-competitor board

and Executive Directors are permitted to seek

such a role, provided that they do not take on

more than one non-executive directorship in,

nor become the Chair of, a FTSE 100 company.

Nicandro Durante, who was an Executive

Director until the end of the year, was Chair

of TIM Participações S.A. and Jeff Carr is

currently a Non-Executive Director of Kingfisher

plc and Chair of its Audit Committee.

Board support

The General Counsel & Company Secretary

isresponsible for organising Board meetings,

as well as collating any papers for the Board

to review and consider. Board and Committee

papers are accessible to all Directors through

a secure and confidential electronic document

storage facility. This facility is maintained by

Reckitt’s Secretariat function and additionally

holds other information which the Chair, the CEO

or the General Counsel & Company Secretary

may deem useful to the Directors, such as press

releases and pertinent company information.

All Directors have individual access to advice

from the General Counsel & Company Secretary

and a procedure exists for Directors to take

independent professional advice at the Company’s

expense in furtherance of their duties.

Executive

The Chief Executive Officer

– Principally responsible for the day-to-day

management of Reckitt, in line with the

strategic, financial and operational objectives

set by the Board

– Chair of the GEC, consisting of the CEO,

theCFO and senior management executives,

who together are responsible for execution

ofthe Company’s strategy and achieving

itscommercial aims

– Effective development and implementation of

strategy and commercial objectives as agreed

by the Board

– Maintaining relationships with investors and

advising the Board accordingly

– Managing Reckitt’s risk profile and establishing

effective internal controls

– Ensuring there are effective communication

flows to the Board and the Chair, and that they

are regularly updated on key matters, including

progress on delivering strategic objectives

– Regularly reviewing the organisation structure,

developing a Group Executive team and

planning for succession

– Providing clear leadership to promote the

desired culture, values and behaviours to

inspire and support the Company’s workforce

– Ensuring the long-term sustainability of

thebusiness

The Company Secretary

– Providing advice and support to the Chair

andall Directors

– Advising and keeping the Board up to date

onall relevant legal and governance

requirements and ensuring the Company

iscompliant

– Ensuring the Board receives high quality,

timelyinformation in advance of Board

meetings to ensure effective discussion

– Facilitating an induction programme for

allBoard members

– Ensuring there are policies and processes

inplace to help the Board function efficiently

and effectively

– Keeping abreast of shareholders’ views

The Chief Financial Officer

– Supporting the CEO in developing and

implementing the Company’s strategy

– Leading the global finance function,

anddeveloping key talent and planning

forsuccession

– Responsible for establishing and maintaining

adequate internal controls over financial

reporting and for the preparation and integrity

of financial reporting

– Ensuring the Board receives accurate, timely

and clear information in respect of the Group’s

financial performance and position

– Developing and recommending the long-term

strategic and financial plan

82 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Composition, Succession and Evaluation

Board Performance review process 2023

The Board undertakes an annual review of

its own and its Committees’ performance

and effectiveness, with a formal externally

facilitated performance review of the Board

conducted at least every three years. In 2020,

we engaged Lintstock to facilitate a three-year

Board Development Programme, which was

extended for an extra year in 2023. In this final

year, the review consisted of both an online

questionnaire and interviews with the Directors.

The 2023 Board performance review considered

the effectiveness of the Board, as well as that

of each Board Committee and the individual

Directors. The areas of focus included Board

composition and succession planning, quality of

information received, Board dynamics and support,

management and focus of meetings, Board

Committees, strategic oversight, risk management

and mitigation, internal control, advancement of

diversity and inclusion, oversight of sustainability

disclosures and board relations. A report, with

action points and recommendations for the

Board to consider, was distributed to Directors

and the results of the review were subsequently

discussed by the Board at its November meeting.

Key themes identified through the performance

review included the need to focus in 2024

on Board succession, risk management and

providing the Board with more opportunities

to engage with the business (for example,

byholding meetings in proximity to key sites).

In addition, the Chair’s performance was

considered by the Senior Independent Director

with input from his fellow Non-Executive

Directors and discussed following the November

Board meeting without the Chair present. The

discussion concluded that the Chair continued

to devote sufficient time to his role and

continued to lead the Board constructively,

demonstrating objective judgement and

encouraging a culture of openness and debate.

Lintstock is independent of and has no other

links with the Company or its Directors in

connection with the performance review.

Actions taken to address the findings of the 2022

review are also outlined in the table opposite.

2022 recommendations Action taken during 2023

Board succession

Whilst Board composition was rated highly,

it was noted that ensuring appropriate

geographical representation, gender diversity

and recruiting Non-Executive Directors

with IT & Digital and marketing experience

would be beneficial to the Board.

Through the Nomination Committee, the Board

maintained a strong focus on Board renewal

during 2023. The appointment of Tamara Ingram

in February 2023, Marybeth Hays in February

2024 and Fiona Dawson in June 2024, brings

material leadership and marketing, retail and

omni-channel experience to the Board.

Talent and succession planning

Chair and CEO succession were

identified as key priorities for 2023.

As detailed in the Nomination Committee Report,

successful exercises have been undertaken

during 2023 resulting in the appointment

of Sir Jeremy Darroch as Chair, Kris Licht

asCEO and Shannon Eisenhardt as CFO.

Execution and delivery

To ensure appropriate oversight of execution

and delivery, risk management, investment

in the capabilities and systems to deliver

the strategy, with a particular focus on

Supply, IT & Digital and Cyber Security.

The Board has during the year maintained

a specific focus on these areas, receiving

detailed briefing on Supply, IT & Digital and

Cyber Security as part of its Board, Audit

Committee and CRSEC Committee agendas.

BOARD PERFORMANCE REVIEW

AND EFFECTIVENESS

83 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Committee priorities in 2023

– The selection and appointment of our new

ChiefExecutive Officer (CEO), Kris Licht,

whowas appointed as CEO Designate in

Mayand formally became CEO on 1 October

– The selection and appointment of our new

ChiefFinancial Officer (CFO) Shannon

Eisenhardt, who was appointed as CFO

Designate on 17 October, and will succeed

JeffCarr in March 2024

– Chair succession planning. In November,

weannounced that Sir Jeremy Darroch,

currently the Senior Independent Director

(SID),would succeed Chris Sinclair as Chair

oftheBoard, from the conclusion of the 2024

Annual General Meeting (AGM), and that

AndrewBonfield will take on the role of

SIDfrom the conclusion of the 2024 AGM

Key objectives for 2024

– Support a smooth Chair transition for

SirJeremyDarroch

– Support the smooth transition of the Executive

Directors, onboarding of the new Non-Executive

Directors and transition of Remuneration

Committee Chair

– Continue succession planning for the Board

andsenior management roles and to keep

Committee memberships under review

Committee membership

Members of the Committee are appointed by

the Board. Membership currently comprises the

Chair, the SID and the Chairs of each of the Board’s

Committees. In accordance with the principles

ofthe Code, the Committee is made up of a

majority of independent Non-Executive Directors.

The General Counsel & Company Secretary acted

as Secretary to the Committee during the year.

The membership of the Committee is reviewed

annually by the Chair as part of the annual

performance review of the Committee.

AllDirectors are required to seek election or

re-election each year at the AGM. Biographical

details of the Directors, including their skills and

experience, can be found on pages 65 to 68.

Role and responsibilities

The role of the Committee, as set out in

the Committee’s terms of reference, is to

ensure that there is a formal, rigorous and

transparent procedure for the appointment

of new Directors to the Board and to lead

the process for Board appointments.

The Nomination Committee has principal

responsibility for making recommendations

tothe Board on new appointments and on the

composition of the Board and its Committees.

The Committee also assists the Board in

succession planning for senior management.

The role of the Committee includes, but is

not limited to, the following matters:

– Reviewing the composition (including skills,

experience, independence, knowledge

anddiversity) of the Board and making

recommendations to the Board with regards

toany changes deemed necessary, taking

intoaccount the length of service of the

Boardas a whole and the need to regularly

refresh membership

– Reviewing the composition of each of the Board

Committees and evaluating the performance

and effectiveness of each Director

– Keeping under review the leadership

capabilities of the Company, covering

bothexecutive, non-executive and senior

management positions, ensuring plans are

inplace for orderly succession, with a view

NOMINATION

COMMITTEE

REPORT

Member

Scheduled

meetings attended

Chris Sinclair (Chair)

Chair and member for the whole year

52/2

Andrew Bonfield

Member for the whole year

52/2

Alan Stewart

Member for the whole year

52/2

Pam Kirby

Member for the whole year

52/2

Sir Jeremy Darroch

Member for the whole year

52/2

This year the Committee’s focus was

onsuccession planning, ensuring that

the right people arein place to enable

Reckitt toexecute its strategic aims.

Chris Sinclair

Chair of the Nomination Committee

84 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Nomination Committee Report continued

toensuring the continued ability of the

Company to compete effectively in the markets

in which it operates. Management succession

planning is considered to be so important that

itis also reviewed by the full Board

– Ensuring that all newly appointed Directors

undertake an appropriate induction programme

to ensure that they are fully informed about the

strategic and commercial issues affecting the

Company and the markets in which it operates,

as well as their duties and responsibilities as a

Director of the Board and member of one or

more Board Committees

– Keeping under annual review and monitoring

potential conflicts of interest, and, if appropriate,

authorising situational conflicts of interest,

whilstensuring the risk of unacceptable

influence resulting from any conflict of interest

isminimised

Further details on the Committee’s role and

responsibilities can be found in its terms of

reference, available at www.reckitt.com.

Board composition

The Committee regularly reviews the

composition of the Board and its Committees,

considering the balance of skills and experience,

diversity and how effectively Directors work

together to achieve Reckitt’s objectives.

Non-Executive Directors are initially appointed

for a three-year term and generally continue to

serve one or more further terms. All Directors are

nominated for appointment by the Committee,

which is subsequently approved by the Board.

In January 2024, we announced the appointment

of Marybeth Hays as a new Non-Executive Director,

effective from 1 February 2024. Marybethbrings

over 25 years of experience in retail, healthcare

and consumer goods and we are delighted

she has joined the Board. Biographical details

for Marybeth can be found on page 68.

In February 2024, we announced the appointment

of Fiona Dawson CBE as a Non-Executive Director

and as Chair Designate of the Remuneration

Committee. Fiona will join the Board on 1 June.

In accordance with the Code, all existing

Directors will stand for election or re-election

at the AGM, with the exception of Chris Sinclair,

Pam Kirby and Alan Stewart who have each

already notified their intention not to stand for

re-election at the AGM, Chris and Pam having

reached the end of their nine-year term.

The Committee recommends that all existing

Board members have their appointments renewed.

Resolutions to this effect will be proposed to

shareholders for approval at the forthcoming AGM.

Details of the specific contributions each Director

makes to Reckitt’s long-term success are set out in

the Notice of AGM, available at www.reckitt.com/

investors/annual-general-meetings.

Key activities during 2023

Meetings of the Committee are held as needed but are required to take place at least once a year.

In2023, the Committee held two scheduled meetings and three additional meetings. Meetings

takeplace ahead of Board meetings and the Chair of the Committee reports formally to the Board

onitsproceedings.

FEBRUARY

Succession planning

CEO succession and senior management succession planning

APRIL

Succession planning

The Committee met to review the CEO succession and then approved

its recommendation to the Board to appoint Kris Licht as CEO

AUGUST

Succession planning

CFO succession planning and recommendation of appointment of CFO

JULY

Succession planning

The Committee considered senior management succession planning,

including for the role of CFO. The Committee also conducted areview

of thecurrent composition of the Board Committees and succession

planning for Committee Chair roles

NOVEMBER

Succession planning

Update on succession planning generally

Recommendation of appointment of Chair and Senior Independent

Director positions

Governance matters

Annual review of Committee terms of reference

Annual review of potential conflicts of interest

Committee performance review

85 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Nomination Committee Report continued

Succession planning

The Committee regularly reviews and monitors the

Board’s structure, size and composition, including

the balance of skills, experience, independence,

knowledge and diversity required and makes

recommendations to the Board of any changes

deemed necessary. Consideration is given to the

length of service of the Board as a whole and

Directors individually. In addition, the Committee

keeps the leadership needs of the Company under

review, including senior management positions,

ensuring plans are in place for orderly succession

and so that the Company can continue to compete

effectively in the markets in which it operates.

The Committee considers Board renewal on

anongoing basis, and makes recommendations

tothe Board regarding proposed appointments.

The Committee is also responsible for making

recommendations from the Non-Executive

Directors for the role of SID and proposes

themembership and the role of Chair for

eachofthe Board Committees.

Induction programmes

New Directors receive a tailored induction

programme on appointment to the Board. The

induction programme generally includes meetings

with the other Directors, the General Counsel &

Company Secretary and GEC members on a 1:1

basis, relevant Committee Chairs (depending

on proposed Committee memberships), the

Presidents of the GBUs and senior representatives

from our advisors such as our lawyers and

External Auditor. The meetings are usually

held in person, virtually or a mix of both.

New Directors may also carry out market

visits and attend key Reckitt sites.

Chief Executive Officer search, selection and induction process

In September 2022, we announced that Nicandro Durante, who was at the time the SID, would undertake

the role of CEO while the Committee identified the best long-term candidate to take Reckitt on the next

phase of its journey.

Following an extensive search, which considered both internal and external candidates, we were pleased

to announce in April that Kris Licht had been selected to become Reckitt’s new CEO.

Further details on the stakeholder considerations the Board had in mind whilst selecting the new CEO

can be found in our Section 172 Statement, on page 76.

STEP 1

The Committee considered and identified

the skills, experience and expertise required

for the role of CEO, taking into account the

long-term strategic priorities of the business.

STEP 2

The Committee outlined a role specification

and engaged Egon Zehnder, an independent

search agency, to conduct a search for

potential candidates, while also considering

potential internal candidates with relevant

skills, experience and expertise. Egon

Zehnder’s search focused on ‘best in class’

CEOs with consumer goods experience.

Following conclusion of their search, Egon

Zehnder drew up a long list of candidates

for the Committee to review. Potential

internal candidates were also reviewed.

STEP 3

The Committee evaluated the potential

candidates and identified a shortlist of

candidates who were invited for meetings

andinterviews.

STEP 4

Following the conclusion of the interviews,

the Committee met to review and provide

feedback on both potential external and

internal candidates. This resulted in the

Committee’s recommendation to the Board

to appoint Kris Licht as Reckitt’s new CEO.

STEP 5

After the Board approved the Committee’s

recommendation, the appointment

wasannounced and a formal induction

processcommenced, including a handover

fromNicandro Durante.

86 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Nomination Committee Report continued

Chief Financial Officer search,

selection andinduction

During the year, a search commenced for a

successor for the Chief Financial Officer (CFO)

position. MWM Consulting Limited (MWM), an

external search firm, were instructed to conduct

a search for external candidates who met the

required criteria. From the individuals identified,

interviews were held with the CEO and CEO

Designate, Chair and the SID. Feedback was

provided to the Committee at its meeting in July.

Following conclusion of the interview process,

the Committee made a recommendation to

the Board to appoint Shannon Eisenhardt.

Chair succession

During the year a process was undertaken to

identify my successor as Chair. This exercise

was undertaken by the Nomination Committee

(excluding me and Jeremy Darroch) and led by

Andrew Bonfield. Based on discussions with

Board members and a thorough market review,

Jeremy Darroch was identified as the best

successor to me as Chair, and his appointment

was recommended by the Nomination

Committee and approved by the Board.

Board Directors ongoing training and development

The Chair has overall responsibility for ensuring

that all the Directors receive suitable training to

enable them to carry out their duties. As part of

their role, Directors are also expected to personally

identify any additional training requirements

they feel would benefit them in performing their

duties. We arrange ongoing training including

on legal and financial regulatory developments

relevant to the Company and the Directors.

Training is also provided by way of briefing

papers or presentations at scheduled Board

meetings, as well as meetings with senior

executives or external sources. The Directors may,

at the Company’s expense, take independent

professional advice and are encouraged to

continually update their professional skills and

knowledge of the business and wider industry.

During the year, training materials have been made

available for Board members to view, on ongoing

UK corporate governance reforms. We also aim

to have one Board strategy meeting held at an

off-site business location each year. This gives

new Directors an opportunity to engage directly

with employees and key personnel in other

jurisdictions and be immersed in our business.

Group Executive Committee (GEC) changes

The GEC changes during the year reflect the

Committee’s focus on succession planning and the

alignment of our functional leaders with Reckitt’s

strategic priorities and growth opportunities.

In July, Susan Sholtis joined the GEC on her

appointment as President of the Nutrition GBU.

Shannon Eisenhardt became a GEC member on

her appointment as CFO Designate in October.

Nicandro Durante, who was CEO up until October

and then remained an Executive Director, resigned

from the Board and as a GEC member at the end

of 2023.

Biographical details of GEC members can be found

on pages 69 to 70.

Committee performance review

A performance review of the Committee

was conducted as part of the broader Board

performance review (see page 82). All areas

received positive ratings overall, with succession

planning for the Chair scoring the highest.

As part of the Board’s annual performance

review, the Committee reviews the Board’s

composition, diversity and how effectively

members work together to achieve objectives.

Directors are evaluated both collectively and

individually, to demonstrate whether each

Director continues to contribute effectively.

Following conclusion of the performance review,

the Committee reports to the Board on the

outcomes of the review that have or will influence

its composition and whether each Director is

committing sufficient time to fulfil their duties.

The Board, having had sight of the results of the

Committee’s performance review, considers the

Committee to continue to operate effectively.

Diversity and inclusion

The Board and Committee fully recognise the

importance of diversity, including gender and

ethnicity, at Board and senior management levels

in compliance with the Code. Inclusioniscore

to Reckitt’s Purpose to ‘protect, heal and

nurture in the relentless pursuit of a cleaner

and healthier world’. We recognise that it

is critical for us to have a diverse employee

population and a Board and senior management

team that is reflective of the markets we

operate in and the consumers we serve.

We are committed to equality of opportunity in

all areas of employment and business, regardless

of personal characteristics. We always recruit

the best and most suitable candidates for

any role, and we strive for a well-balanced

representation of backgrounds, nationalities,

cultures, skills and experiences at all levels

across the Group. Ultimate responsibility for

and sponsorship of this policy rests with the

GEC. Senior management is accountable and all

Reckitt employees are responsible for ensuring

that our diversity policies and programmes

are actively implemented and followed.

87 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Nomination Committee Report continued

Although we do not have a written Board diversity policy, the Committee and the Board are committed

to recruit members of the Board on the strict criteria of merit, skill, experience and cultural fit of any

potential candidates, and to seek diversity of gender, social and ethnic backgrounds, cognitive and

personal strengths. This commitment is demonstrated through our Board composition which comprises

eight nationalities and seven women as at the date of this Report. Our Board consists of one member

from an ethnic minority, in line with the Parker Review recommendation and the Financial Conduct

Authority (FCA) Policy on Diversity and Inclusion on Company Boards and Executive Management.

Our GEC, comprising the most senior management level in the business, represents seven different

nationalities from across the globe, embodying our truly multinational focus. The Company’s wider global

leadership community holds over 49 nationalities between them, representing a broad background of

collective skills, cultures and experience. This widens our understanding of our consumers, who themselves

come from the broadest possible backgrounds allowing us to be best placed in serving their needs.

Number of

board members

Percentage

of the board

Number of

senior positions

on the board

(CEO, CFO, SID

and Chair)

Number in

executive

management

Percentage of

executive

management

White British or other

White (including

minority-white groups) 12 80% 100% 9 76%

Mixed/Multiple Ethnic

Groups – – – 1 8%

Asian/Asian British 1 7% – 1 8%

Black/African/

Caribbean/Black British – – – – –

Other ethnic group,

including Arab – – – 1 8%

Not specified/

prefer not to say 2 13% – – –

Representation of women at Board and senior management levels

As at 31 December 2023, 40% of our Board members are women and we have achieved the 40% target

as outlined in the FTSE Women Leaders Review (formerly the Hampton-Alexander Review). In addition,

we will comply with the FCA’s Policy on Diversity and Inclusion on Company Boards and Executive

Management, which requires that at least one of the senior Board roles should be held by a woman,

withthe appointment of Shannon Eisenhardt as CFO in March 2024.

As at 31 December 2023, representation of women within the GEC was 33%, and within the GEC and

theirdirect reports was 29%. We are cognisant of the gap in performance towards the 40% for women

inleadership within the GEC as detailed in the FTSE Women Leaders Review (and in Provision 23 of

theCode).

We recognise that representation of women at our most senior levels needs improvement, and the

Committee continues to make a commitment to increase women’s representation at this level.

As at 31 December 2023, women employees accounted for 45% of our global workforce and make up

51% of our manager population.

Number of

board members

Percentage

of the board

Number of

senior positions

on the board

(CEO, CFO, SID

and Chair)

Number in

executive

management

Percentage of

executive

management

Men 9 60% 100% 8 67%

Women 6 40% –

4 33%

Not specified/

prefer not to say – – – – –

1. Shannon Eisenhardt was appointed as CFO Designate on 17 October 2023 and will take on the role of CFO in March 2024

We continue to put diversity and inclusion at the centre of everything we do. Further details can be

found at pages 19 to 21 and in our Fairer Society section on page 51.

88 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

On behalf of the Board, I am pleased to present the Audit Committee Report for the financial year ended

31 December 2023.

This report details how the Committee has discharged its role, duties and performance during the year

under review in relation to internal control, financial and other reporting, risk management, the internal

audit function and our relationship and interaction with the External Auditor.

Committee priorities in 2024

– Maintaining oversight and providing assurance to the Board on Reckitt’s risk management and internal

control procedures, including monitoring key areas in the context of risk and control

– Sustaining a strong culture of risk management and embedding and strengthening internal controls

across the Group

– Monitoring potential legislative and regulatory changes which may affect the work of the Committee

– Reviewing cyber security risks and controls

Committee membership and experience

Name Recent and relevant financialexperience

Sectoral experience relevant

toReckitt’s operations

Andrew Bonfield (Chair) – Financial expert

– Chartered Accountant

– Currently CFO of a global US Fortune

100company

– Multiple CFO roles at other large companies,

including in the consumer goods sector

– Consumer goods

– Pharmaceuticals/healthcare

Pam Kirby – Sits on another FTSE 100 company’s

AuditCommittee

– Pharmaceuticals/healthcare

– Technology

Margherita Della Valle – Financial expert

– Holds a Master’s degree in Economics

– Previously held Group CFO and senior

finance roles

– Consumer goods

– Technology

Elane Stock – Holds Master’s degrees in Finance

– Previously member of the audit committee

of two US listed entities

– Consumer goods

– Emerging markets

Tamara Ingram – Member of the Audit Committee of

aUS-listed company

– Consumer goods

– Digital strategy

AUDIT

COMMITTEE

REPORT

The focus this year remained on

oversight of Reckitt’s internal controls

and risk management framework in

the context of the upcoming revisions

to the Corporate Governance Code.

Andrew Bonfield

Chair of the Audit Committee

Member

Meetings

attended

Andrew Bonfield (Chair)

Chair and member for the whole year

54/4

Pam Kirby

Member for the whole year

54/4

Margherita Della Valle

Member for the whole year

53/4

Elane Stock

Member for the whole year

54/4

Tamara Ingram

Member from February 2023

54/4

89 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Audit Committee Report continued

All Committee members are independent

Non-Executive Directors who have financial,

economics and/or business management

expertise in large companies.

As Chair of the CRSEC Committee, Pam Kirby’s

membership of the Audit Committee ensures that

relevant issues, such as risk, whistle-blowing and

compliance, are shared and coordinated between

the two Committees.

Committee members are expected in particular

tohave an understanding of:

• The Group’s operations, policies and internal

control environment

• The principles of, and recent developments

in, financial reporting

• Relevant legislation, regulatory requirements

and ethical codes of practice

• The role of internal and external audit and

riskmanagement

The Board is satisfied that, in compliance with

theCode, Committee members as a whole have

competence relevant to the Company’s sector

(consumer goods).

Committee appointments are generally

madeforathree-year period. Members of the

Committee are appointed by the Board on the

recommendation of the Nomination Committee.

On joining the Committee and during their tenure,

members receive additional training tailored

totheir individual requirements. Committee

members also meet with management covering

internal audit, risk management, legal, tax, treasury

and financial matters, as well as meetings with the

External Auditor.

During the year, members of the Committee

received regular briefings from management

onmatters covering governance and legislative

developments, accounting policies and practices,

and tax and treasury.

During the year, the Head of Secretariat acted

asSecretary to the Committee.

Meetings

During 2023, the Committee held four scheduled

meetings at times aligned to the Company’s

reporting cycle. In addition, one non-scheduled

meeting was held via videoconference, as

permitted by the Company’s articles of association

and the Committee’s terms of reference.

Committee meetings usually take place ahead of

Board meetings and the Committee Chair provides

an update to the Board on the key issues discussed

at each meeting. Committee papers are provided

to all Directors in advance of each meeting,

including a copy of the Committee minutes.

Meetings are attended by senior representatives

of the External Auditor and by the Group Head

ofAudit, CFO, CFO Designate and SVP Corporate

Controller. TheChair of the Board and the CEO are

also invited to attend. Other management attend

whendeemed appropriate by the Committee.

Time is allocated at the end of each meeting

forprivate discussion with internal audit and

theExternal Auditors, without other invitees

beingpresent, as well as a private session

oftheCommittee members.

Committee members’ meeting attendance

duringthe year is set out on the first page

ofthisAudit Committee Report.

Committee performance review

A performance review of the Committee

wasconducted as part of the Board’s external

performance review, conducted by Lintstock.

The performance review of the Committee

utilised a bespoke questionnaire sent

to Committee members followed by an

interview. Matters evaluated by Committee

members included meeting management and

composition, Committee support, Committee

relationships, quality of information and the

work of the Committee and its review of

controls and reporting. All areas received

positive ratings overall, with management

ofCommittee meetings scoring the highest.

The Board, having had sight of the results of

theCommittee’s performance review, considers

the Committee to be operating effectively.

90 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Audit Committee Report continued

Fair, balanced and understandable

The Committee reviewed the 2023 Annual

Report and Financial Statements to confirm

that it is fair, balanced and understandable

and provides sufficient information to

shareholders to assess the Group’s position,

performance, business model and strategy.

The Committee relies upon the following

assurance framework in making its assessment

of fair, balanced and understandable:

– All sections of the 2023 Annual Report and

Financial Statements were prepared in

accordance with the Standard Operating

Procedures (SOPs) as approved by the

Disclosure Committee

– A detailed review of the 2023 Annual Report

and Financial Statements was undertaken

bysenior management and the Disclosure

Committee to ensure consistency in

messaging and appropriate balance

– A comprehensive review by the Directors

and the senior management team of

theform, content and consistency of

narrative, the disclosures contained in the

Financial Statements and the underlying

processes and controls supporting the

preparation ofthe 2023 Annual Report

andFinancial Statements

– The comprehensive verification process,

supporting any facts, figures and statements

included in the 2023 Annual Report and

Financial Statements

Role and responsibilities

The Committee is part of the Group’s

governance framework and supports the

Board in fulfilling its oversight responsibilities

in ensuring the integrity of the Group’s

financial reporting, internal controls and overall

risk management process, and relationship

with the Company’s External Auditor.

Financial reporting

– Monitor the integrity of the financial

statements of the Company including

interimand annual financial statements

– Review the appropriateness of significant

accounting policies and practices

– Review significant financial judgements and

estimates, taking into account the External

Auditor’s view on the financial judgements

and estimates

– Advise the Board on whether, taken as a

whole, the Annual Report is fair, balanced

and understandable and provides the

information necessary for shareholders

toassess the Company’s performance,

business model and strategy

Risk management systems and internal controls

– Review and monitor the effectiveness of

themanagement of risk and overall system

of Internal Control

– Review the framework and analysis to

support both the Going Concern and

thelong-term Viability Statement

Whistle-blowing, fraud and compliance

– In conjunction with the CRSEC Committee,

review the Company’s arrangements for its

workforce to raise concerns about possible

The Committee and the Board received

confirmation from management that the

Annual Report and Financial Statements

had been prepared in accordance with the

assurance framework and that appropriate

verification had been undertaken.

In addition, the Committee also reviewed

KPMG’s audit findings report, draft audit opinion

and draft management representation letter.

Following the Committee’s review, the

Committee was satisfied that the 2023

Annual Report and Financial Statements,

taken as a whole, met its objectives and

accordingly recommended to the Board

that the 2023 Annual Report and Financial

Statements be approved and that the

Board make its statement on page 137.

wrongdoings in financial reporting and other

matters; review the Company’s procedures

for detecting fraud; and its systems and

controls for ethical behaviours and the

prevention of bribery

External audit

– Make recommendations to the Board on the

appointment, removal, remuneration and

terms of engagement of the External Auditor

– Review and assess the External Auditor’s

independence and objectivity taking into

account relevant UK law, professional and

regulatory requirements

– Develop, recommend and implement the

Group’s policy in relation to the provision

ofnon-audit services

– Review and approve the annual audit

planand assess the effectiveness of

theaudit process

Internal audit

– Review and approve the annual internal

auditplan and monitor and review

itseffectiveness

– Review and monitor the effectiveness of

theinternal audit function, ensuring the

necessary resources are in place for it

toperform effectively

There were no significant changes to the

Committee’s role and responsibilities during

the year.

The Committee’s role and responsibilities

are set out in its terms of reference,

whichare available at www.reckitt.com.

91 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Audit Committee Report continued

Key activities during the year

FEBRUARY MAY JULY NOVEMBER

– Review of the 2022 preliminary results

announcement, including the Financial

Statements and recommend for

approval by the Board

– Review of the 2022 Annual Report

andFinancial Statements, the going

concern basis of preparation and

Viability Statement, including whether

the Committee could recommend that

the Board approve the 2022 Annual

Report and Financial Statements

– KPMG’s 2022 audit findings report,

observations on Reckitt’s internal

controls for the 2022 financial year,

management representation letter

and report on the 2022 Annual Report

and Financial Statements

– KPMG’s final non-audit fees for 2022

– Annual review of risk management

and internal controls including

reviewof risks across Group

functionsand of the integrated

riskmanagement framework

– Approval of KPMG’s 2023 audit fees

and terms of engagement

– Conduct assessment of External

Auditor independence and ethics

– KPMG’s strategy for the 2023 audit

– Conclude on audit quality delivery and

assess External Auditor effectiveness

– Work undertaken in respect of the

2023 internal audit plan and monitoring

the 2023 internal audit plan

– Review of whistle-blowing procedures

– Consider legal matters, including

provisioning and compliance risk

andcompliance controls

– Consider tax and treasury matters,

including provisioning for uncertain

taxpositions and compliance with

statutory reporting obligations

– Review of risk management and

business continuity

– Review of the Company’s IT controls,

with a focus on cyber risk

– Review of the 2023 half-year results

announcement, including the going

concern basis of preparation and

recommendation for approval

bytheBoard

– KPMG’s half-year review report

findings to 30 June 2023 and

management representation letter

– KPMG’s assessment of its objectivity

and independence

– Review internal audit findings and

responsiveness of management

– Review of the Committee’s

2024standing agenda and terms

ofreference

– Results of the performance review

ofthe Committee

– Monitor legislative and governance

changes regarding proposed audit

reform and changes to the Code

– Review of the Company’s IT controls

with a focus on cyber risk

– KPMG’s interim IT control findings

relating to the 2023 audit cycle

– Annual review and approval of

GroupTreasury policies

– Review KPMG’s non-audit fees for

2023 and review of independence

– Review of internal controls

andtheCompany’s controls

transformation programme

92 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Audit Committee Report continued

Significant and key financial reporting matters

The key matters reviewed and evaluated by the

Committee during the year were as follows.

The Committee is responsible for reviewing

andapproving the appropriateness of the interim

and annual Financial Statements and related

announcements, including:

– Recommending that, in the Committee’s view,

the Financial Statements are fair, balanced

andunderstandable. In addition to the

detailedpreparation and verification

proceduresin place for the 2023 Annual

Reportand Financial Statements, management

continued its focus on narrative reporting

withclear written and visual messaging

tocommunicate the Group’s strategy

– Reviewing the appropriateness of the

accounting policies, judgements and estimates

used as set out from pages 160 to 200 and

concluding that the judgements and

assumptions used are reasonable

– Reviewing the Group’s policy relating to,

anddisclosure of, alternative performance

measures (APMs)

Areas of significant financial judgement

The areas of significant financial judgement in

relation to the 2023 Group Financial Statements

considered by the Committee, together with a

summary of the actions taken, were as follows.

Recoverability of goodwill

andotherintangibleassets

Under International Financial Reporting Standards

(IFRS), goodwill and indefinite-life assets must be

tested for impairment on at least an annual basis.

Impairment testing is inherently judgemental and

requires management to make multiple estimates,

on future performance, for example around future

price and volume growth, future margins, terminal

growth rates and discount rates. The Group’s

impairment testing utilised cash flow projections

included within one-year budgets and five-year

strategic plans. Cash flows beyond the five-year

period were projected using terminal growth rates.

As a result of impairment testing performed

in 2023, management determined that an

impairment charge of £810 million relating to its

IFCN cash-generating unit (CGU) was required

at 31 December 2023 (2022: impairment charge

of £152 million relating to the Biofreeze CGU

and £15 million relating to other CGUs).

In November 2023, the Committee reviewed

the detailed results of the impairment testing

for the Group’s CGUs, with a particular focus

on the Biofreeze CGU, as no headroom existed

between the Biofreeze recoverable amount and

carrying value following impairment in 2022. The

Committee challenged the key assumptions

which underpinned the Biofreeze recoverable

amount, including anticipated category growth,

market share improvement, the commercial

success of new product launches and international

market expansion. The Committee confirmed

the key judgements and estimates made by

management including market expansion and

discount rate, and reviewed the sensitivity of

the Biofreeze impairment model to changes in

key assumptions. Subsequent to the impairment

review the Committee reviewed the transfer of

Biofreeze goodwill (£160 million) to the Health

CGU, the transfer occurring due to the completion

of the integration of Biofreeze into Health in

2023, and considered it to be appropriate.

In February 2024, following management’s

considerations of the external auditor’s

observations, the Committee reviewed the detailed

results of the impairment testing in relation to the

IFCN CGU and challenged the key assumptions

which underpinned the IFCN recoverable amount

at 31 December 2023. This included the effect

of changes to the regulatory environment, the

level at which US market share stabilises, net

revenue growth rates, the commercial success

of new product launches and the expansion

of speciality nutrition. The evolving regulatory

environment has increased the judgemental

nature of estimating the future cash flows, thereby

resulting in increased scrutiny and focus by the

Committee and challenge to management.

This challenge resulted in refinement of the

assumptions underpinning management’s estimate

of the recoverable amount of the IFCN CGU.

The Committee also reviewed the discount rate

used by management to calculate the value in use

of IFCN, in particular the increase in the discount

rate in 2023 due to a higher risk free-rate.

The Committee confirmed the key judgements

and estimates made by management and

reviewed the sensitivities of the impairment

model to reasonable changes in key assumptions.

The Committee reviewed management’s

disclosures in relation to goodwill, other intangible

assets and related impairment reviews included

within Note 9 and considered them appropriate.

Forward purchase of shares held

bynon-controlling interests

On 25 May the Group entered into an agreement

pursuant to which it will proceed to acquire

the remaining interests associated with the

Company’s majority owned activities in mainland

China and Hong Kong (RB Manon) from its

existing minority shareholders. The transaction

will be implemented through the purchase,

in multiple stages, of the non-controlling

shareholdings held by the minority shareholders.

Amounts payable under the agreement are

dependent on the revenue and profits of RB

Manon in future periods. Management’s estimate

of the present value of amounts payable at the

date of the agreement is £298 million. The key

assumptions underpinning this estimate relate

to future revenue and profit growth of Reckitt’s

business in China, and the discount rate used to

determine the present value of future cash flows.

The Committee reviewed these assumptions

and considered them to be reasonable.

As the agreement to acquire the non-controlling

interest has multiple elements, judgement is

required to allocate the total amount payable

under the agreement to each element.

Management determined that the main elements

in the agreement related to (1) a forward contract

for the purchase of a non-controlling interest

in RB Manon, with £167 million allocated to this

element charged to shareholders equity, and

(2)services provided by the minority shareholders

in relation to the transition of leadership and

shares in RB Manon, with the residual amount

of £131 million allocated to this element, which

will be charged to the income statement over

the performance period for these services.

The Committee reviewed the identification and

allocation of consideration to each element in

the agreement, and the disclosures included

in Note 30, and considers them appropriate.

Tax provisioning

From time to time, the Group may be involved in

disputes in relation to ongoing tax matters in a

number of jurisdictions around the world where

the approach of the local authorities is particularly

93 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Audit Committee Report continued

difficult to predict. The amount of uncertain tax

position liabilities recorded in relation to these

investigations is an area where management and

tax judgement are important. The Committee

reviewed the key judgements made with

management, including relevant professional

advice that may have been received in each

case, and considered the level of recognised

uncertain tax position liabilities to be appropriate.

As required under IFRS, management has included

disclosure in the Financial Statements outlining

the amount of uncertain tax position liabilities, the

methodology by which they have been recognised

and the sources of estimation uncertainty in

relation to these uncertain tax position liabilities

or the rationale for why sensitivity disclosure is

not meaningful and has not been provided in

the Financial Statements. The Committee has

reviewed these disclosures, included within

Notes1 and 22, and considers them appropriate.

Legal liability provisioning

At 31 December 2023 a provision of £137 million

(2022: £221 million) was held on the Group’s

Balance Sheet in relation to regulatory,

civilandcriminal investigations as well

aslitigationproceedings.

The Committee has reviewed the status of

potential legal and constructive liabilities

during the year, and at the year end, including

the South Korea Humidifier Sanitiser (HS) issue,

Necrotizing Enterocolitis (NEC), Phenylephrine (PE)

and other significant matters. The Committee

challenged management on the judgements

made in determining the level of provisions

recognised and was satisfied with the level of

provisioning and associated disclosure for the

HS issue, NEC, PE and other significant matters

(see note 20). The Committee was also briefed

on the implications of the recent NEC state

court jury award in Belleville, Illinois (see note 33)

and challenged management on their exercise

of judgements described in the disclosure.

Other key financial reporting matters

Other key matters reviewed and evaluated in

relation to the 2023 Group Financial Statements

considered by the Committee, together with a

summary of the actions taken, are set out below.

Investigation in the Middle East

As part of the Group’s ongoing compliance

procedures, an investigation was conducted in

two Middle Eastern markets in late 2023 and early

2024. The investigation was led by the Group’s

Ethics and Compliance function, supported

by external legal counsel, internal audit and

corporate controllership. The Committee was

kept updated as the investigation progressed

and discussed the findings of the investigation

ahead of the release of the 2023 preliminary

results announcement and finalisation of the

2023 Annual Report. An understatement of

trade spend, which related to the fourth quarter

and prior quarters of 2023, was identified and

incorporated into the 2023 financial statements.

The Committee reviewed the investigation

reports and related accounting adjustments.

The Committee will continue to monitor the

actions and internal control enhancements taken

by management in response through 2024.

Going concern and Viability Statement

A Viability Review was undertaken by

management, encompassing its going concern

review. The Committee reviewed and challenged

the key assumptions used by management in its

Viability Review and going concern assessment, as

well as the scenarios applied and risks considered.

Based on its review, the Committee considers

that the application of the going concern basis

for the preparation of the Financial Statements

was appropriate and confirmed the suitability

of the Viability Statement covering a five-year

period, as set out on page 61. The use of a

five-year period for the Viability Review is the

period of the Group’s long-term forecasting

process and covers the various business cycles.

Internal audit

Role of internal auditor

The Committee is responsible for reviewing and

monitoring the effectiveness of the internal audit

function. The Group Head of Audit is accountable

to the Chair of the Committee, although for

administrative matters reports to the CFO. The

function operates independently of the business,

with no responsibility for operational management.

The independence of the Group Head of Audit

and the internal audit function is considered as

part of the annual internal audit effectiveness

review. Further details can be found on page 94.

The function is responsible for providing

independent and objective assurance on the

adequacy and effectiveness of Reckitt’s risk

management and internal control systems.

Itsmandate is set out in a written charter, approved

by the Committee, and it uses a formal internal audit

methodology consistent with the Institute of Internal

Auditors internationally recognised standards.

Prior to the start of each financial year the

Committee reviews and approves the annual audit

plan and assesses the adequacy of the function’s

budget and resources. The function brings in

specialist skills from external service providers,

as necessary. The strengthening of the finance

second line will allow the function in future periods

to transition away from an agreed rotation and

scope policy to a more risk-based approach.

The risk-based audit plan focuses on areas

deemed critical to achieving our business

objectives and covers Reckitt’s commercial

businesses, manufacturing facilities, information

systems, programmes and higher risk areas

and processes. Following each audit, control

weaknesses are reported to senior management,

together with recommendations and updates.

Resulting management actions are tracked

until they are satisfactorily closed. Audits that

identified significant weaknesses in the control

environment normally receive a follow-up

audit within 12 to 18 months as appropriate.

At each Committee meeting the Group Head

of Audit presents an update which includes an

assessment of the control environment together

with any material issues, the performance

of the internal audit function, and any other

topics as required. A private session with the

Committee is also held at every meeting.

Risk management

The Committee supports the Board in fulfilling its

oversight responsibilities in ensuring the integrity

of the Group’s financial reporting (including

the Annual Report and Financial Statements),

system of risk management and internal control,

and the relationship with the External Auditor.

The Committee makes recommendations

to the Board in relation to approval of the

Annual Report and Financial Statements.

The Committee regularly monitors our system

of risk management and internal control

(including internal financial controls). The finance

function, headed by the CFO, has implemented

policies, processes, and controls to enable the

Company to review and comply with changes

in accounting standards and relevant financial

regulations. These policies, processes and

controls are kept under review on an ongoing

94 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Audit Committee Report continued

basis to ensure both internal and external

developments are reviewed and acted upon.

In monitoring the integrity of financial reporting

and any other risks falling within its remit,

theCommittee receives regular reports from the

SVP Corporate Controller, Group Chief Ethics &

Compliance Officer, Group Head of Tax and Group

Head of Treasury on material developments in

the legislative, regulatory, and fiscal landscape in

which the Group operates. It also receives reports

on IT and cybersecurity risks and controls, and

on the Group’s whistle-blowing arrangements.

The Committee reported to the Board in February

2024 that it considers the internal control

framework to be functioning appropriately,

to enable the Board to meet its obligations

under section 4 of the Code, to maintain

sound risk management and internal control

systems, and to report to shareholders on

these in the Annual Report (see page 137).

Reckitt’s ongoing controls transformation

programme in preparation for internal

controlschanges arising from the revisions

totheCodehasidentified certain control

improvement opportunities that management

iscurrentlyundertaking.

The basis for the preparation of the Group

Financial Statements is set out on page 160

underAccounting Policies.

The External Auditor’s report, setting out its

work and reporting responsibilities, can be

found on pages 138 to 155. The terms, areas of

responsibility and scope of the External Auditor’s

work are agreed by the Committee and set out

in the External Auditor’s engagement letter.

More information on the Group’s principal and

emerging risks and strategy for growth and

achieving targeted goals is detailed in the Strategic

Report, which can be found on pages 55 to 60.

The Viability Statement can be found on page61.

The Statement of Directors’ Responsibilities on

page 137 details the Directors’ responsibility

for the Financial Statements, for disclosing

relevant audit information to the External

Auditor and for ensuring that the Annual

Report is fair, balanced and understandable.

Internal controls framework

Internal control processes are implemented through

clearly defined roles and responsibilities, supported

by clear policies and procedures, delegated to the

GEC and senior management. Reckitt operates

a ‘three lines of defence’ model in monitoring

internal control systems and managing risk.

1. Management in the first line ensures that

controls, policies and procedures are followed

indealing with risks in day-to-day activities.

Such risks are mitigated at source with controls

embedded into relevant systems and

processes. Supervisory controls, either at

management level or through delegation,

ensure appropriate checks and verifications

take place, with any failures dealt with promptly.

Throughout Reckitt, a key responsibility for any

line manager is to ensure the achievement of

business objectives with appropriate risk

management and internal control systems.

2. Each function and GBU has its own

managementwhich acts as a second line

ofoversight. This second line sets the local

levelpolicies and procedures, specific to its

ownbusiness environment, subject to Group

policy and authorisation. The second line

furtheracts in an oversight capacity over

theimplementation of controls in the first line.

The financial performance of each function

andGBU is monitored against pre-approved

budgets and forecasts ultimately overseen

bythe executive management and the Board.

As part of the second line, the corporate control

team identifies financial risks and mitigates

these with appropriate internal controls,

setoutthrough minimum expected financial

control requirements. The effectiveness

oftheglobal financial control framework

isreviewed annually. Further, the Group’s

compliance controls includethe operation

ofanindependent and anonymous ‘Speak Up’

whistle-blowing hotline, annual management

reviews and the provision of training specific

toindividual needs within the business.

3. The third line of defence is provided by

theinternal audit function which provides

independent and objective assurance

tomanagement and the Committee on

theadequacy and effectiveness of risk

management systems and internal controls

operated by the first and second lines

ofdefence. Internal audit also facilitates

theriskmanagement process.

Reckitt’s internal control framework provides

assurance that business objectives are

achieved, that business is conducted in an

orderly manner and in compliance with local

laws, that records are accurate, reliable

and free from material misstatement, and

that risks are understood and managed.

The corporate control team is accountable

formanaging global financial control policies and

frameworks and for monitoring the effectiveness

of the Group’s internal financial control

environment. Corporate control is responsible for

reporting and monitoring controls at local, GBU

and global levels, working with markets to improve

risk and controls capability and to support the

development of remediation plans and corrective

actions for financial control weaknesses.

To improve the maturity of the control

environment and meet upcoming changes

to the Code, the Company has established a

multi-year controls transformation programme.

In 2023, the controls transformation programme

launched an updated, standardised and risk-

focused controls framework for financial and

IT general controls, including new evidence

standards to enable consistent documentation

of the operating effectiveness of financial

and IT general controls. Following launch, the

second line of defence team, supported by

external advisors, conducted a comprehensive

fit-gap assessment to determine the required

uplift to comply with the new framework and

evidence standards. As anticipated, gaps

versus the framework and standard have

been identified in relation to the retention of

evidence and the formality and consistency of

control operation. Where required, plans have

been developed and remediation activity is

underway in markets, IT and group. In 2023, the

effectiveness of the global financial control

framework has been assessed through analysis

of the results from the fit-gap assessment and

subsequent remediation, alongside consideration

of findings on the internal control environment

from internal audits conducted in 2023.

At each meeting, the Committee reviews

a report outlining the status of the controls

transformation programme, the results of the

fit-gap assessment and remediation progress,

and other notable controls activity since the

previous meeting. In 2024, assurance over

95 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Audit Committee Report continued

the operating effectiveness of controls in the

revised framework will be provided by testing

conducted by the second line of defence team.

Internal auditor effectiveness review

The Committee monitors the effectiveness of

the internal audit function throughout the year

through the Group Head of Audit’s attendance at

Committee meetings, review of work presented

throughout the course of the year and the

annual internal audit effectiveness review.

The annual review involves the solicitation of

feedback through a survey circulated to internal

stakeholders including Committee members, GEC,

GBU, functional and operational leadership teams.

The survey assessed the skills and experience,

audit quality, audit scope, audit cost, audit

communication, independence, and change catalyst

of the internal audit function. The survey reported

strong, positive feedback with management

viewing the function as comprised of high quality

and skilled individuals who demonstrate a high

level ofintegrity, independence, and objectivity.

The Committee has considered the conclusions of

the effectiveness review and the work performed

by the function during the year and remains

satisfied that the resourcing, quality, experience

and expertise of the function is appropriate

for the Company and that the function was

objective and performed its role effectively.

External Auditor

The Committee is responsible for maintaining the

relationship with the External Auditor on behalf

of the Board. The Company’s External Auditor is

KPMG LLP (KPMG). Following a competitive tender

undertaken in 2017, KPMG was formally appointed

as the Group’s External Auditor by shareholders

in 2018. The Company will be required to conduct

its next external audit tender no later than 2027.

For the year ended 31 December 2023, the

Company has complied with the Competition

and Markets Authority Order: The Statutory

Services for Large Companies Market Investigation

(Mandatory use of Competitive Tender Processes

and Audit Committee Responsibilities) Order 2014.

The Committee considers and makes a

recommendation to the Board in relation to the

appointment, reappointment and removal of the

External Auditor, taking into account independence,

effectiveness, lead audit partner rotation and

any other relevant factors, and oversees the

tendering of the external audit contract.

The Committee approves the External Auditor’s

terms of engagement and remuneration and

reviews the strategy and scope of the audit

andthe work plan.

The Committee also monitors the rotation

of the lead audit partner every five years in

accordance with the FRC’s Ethical Standard. The

current lead audit partner, Andrew Bradshaw, has

completed his second year as lead audit partner.

External auditor effectiveness review

The annual evaluation of the External Auditor

was carried out in early 2023 and the results

reported to the Committee in May. The

assessment of the External Auditor was

conducted using a survey circulated to the

Board, GEC, GBU, finance and other functional

leadership and local finance management.

The survey covered the four competency

areas in the FRC’s Guidance on Audit Quality:

practice aid for Audit Committees (published

inDecember 2019): Judgement; Quality Control;

Skills and Knowledge; and Mindset and Culture.

Besides the annual evaluation of the External

Auditor, the Committee continually reviews the

External Auditor’s effectiveness through means

such as the monitoring of its progress against

the agreed audit plan and scope. KPMGreports

to the Committee annually with an audit

quality scorecard, providing a holistic view of,

and their investment in, audit quality and how

they measure their audit quality progress.

External Audit fees and non-audit services

The Committee reviews the nature and level

of non-audit services undertaken by the

External Auditor during the year to satisfy itself

that there is no impact on its independence.

The Committee is required to approve all

non-audit services. TheBoard recognises

that in certain circumstances the nature of

the service required may make it timelier and

more cost-effective to appoint an auditor that

already has a good understanding of Reckitt.

The total fees paid to KPMG for the year ended

31 December 2023 were £20.7 million, of which

£1.3million related to non-audit and audit-related

work (to which KPMG was appointed principally for

the above reasons). The Group’s internal policy on

non-audit fees (effective 1 January 2017) states

that, on an annual basis, non-audit fees should not

exceed 50% of the Group’s external audit and audit-

related fees for the year. The Board confirms that,

for the year ended 31 December 2023, non-audit

and audit-related fees were 6.7% of the audit fees.

Details of services provided by the External

Auditor are set out in Note 4 on page 169.

Independence and reappointment

Reckitt has a formal policy in place to safeguard

the External Auditor’s independence. In addition,

as part of its audit strategy presentation to the

Committee in May, KPMG identified its own

safeguards in place to protect its independence

and confirmed its independence in February

totheCommittee.

The Group has a policy that restricts the

recruitment or secondment of individuals

employed by the External Auditor into positions

that provide financial reporting oversight where

they could exercise influence over the financial

or regulatory statements of the Group or the

level of audit and non-audit fees. Other than the

provision of advisory services to a Director in

their personal capacity, KPMG had no connection

with the Directors during the financial year.

The External Auditor is a key stakeholder in

helping the Committee fulfil its oversight role

for the Board. The Committee remains satisfied

with the External Auditor’s independence

and effectiveness and believes KPMG is best

placed to conduct the Company’s audit for

the 2024 financial year. KPMG has expressed

awillingness to continue as External Auditor

ofthe Company. Following a recommendation

by the Committee, the Board concluded, on the

Committee’s recommendation, that it was in the

best interests of shareholders to appoint KPMG

asthe Company’s External Auditor for the financial

year ending 31 December 2024. The Committee

and Board’s recommendation was free from third

party influence and there was no contractual

term of the kind mentioned under Regulation

(EU) No 537/2014 imposed on the Company.

In accordance with Section 489 of CA 2006,

resolutions to propose the reappointment of KPMG

as the Company’s External Auditor and to authorise

the Committee to fix its remuneration will be

put to shareholders at the AGM on 2 May 2024.

Andrew Bonfield

Chair of the Audit Committee

Reckitt Benckiser Group plc

21 March 2024

Committee

areas of focus

96 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Area of focus Further detail Pages

Legal compliance and ethics Risk Management

55-60

Section 172 Statement

76-77

Audit Committee Report

88 -95

Sustainability Sustainability Performance Dashboard

Sustainability Performance Review

47-54

Product safety and quality Our Supply Chain

25-27

Our Stakeholders

37-40

Sustainability Performance Review

47-54

R&D and regulatory compliance Scientific Innovation

22-24

Nutrition – Market Opportunities

34-36

External affairs Our Stakeholders

37-40

Section 172 Statement

76-77

CORPORATE RESPONSIBILITY,

SUSTAINABILITY, ETHICS

ANDCOMPLIANCE

COMMITTEEREPORT

Member

Meetings

attended

Pam Kirby (Chair)

Chair and member for the whole year

54/4

Mehmood Khan

Member for the whole year

54/4

Chris Sinclair

Member for the whole year

54/4

Olivier Bohuon

Member for the whole year

53/4

Kris Licht

Member from 1 June 2023

52/2

The Committee receives regular briefings

from key functional teams to enable it

todischarge its oversight responsibilities

and works with the Audit Committee

onareas of crossover, as needed.

Pam Kirby

Chair of the Corporate Responsibility, Sustainability,

Ethicsand Compliance Committee

CRSEC

Legal

compliance

and ethics

Sustainability

Product

safety and

quality

R&D and

regulatory

compliance

External

affairs

97 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Corporate Responsibility, Sustainability, Ethics and Compliance Committee Report continued

On behalf of the Board, I am pleased to present

the Corporate Responsibility, Sustainability, Ethics

and Compliance (CRSEC) Committee Report for

the financial year ended 31 December 2023.

This report details how the Committee has

discharged its role and responsibilities during

the year in relation to monitoring and assessing

our approach to responsible, sustainable,

ethical and compliant corporate conduct in

accordance with our Purpose and Compass,

and our broader societal responsibility.

Committee membership

Members of the Committee are appointed by the

Board on the recommendation of the Nomination

Committee, which reviews membership in terms

of skills, knowledge, diversity and experience.

On joining the Committee and during their tenure,

members receive additional briefings and training

tailored to their individual requirements. This

includes meetings with internal management

covering CRSEC matters. All members of the

Committee receive regular briefings from senior

executives on matters covering governance,

regulatory and legislative developments,

product safety and corporate responsibility,

sustainability and ethics-related matters, and

Reckitt’s practices and policies in these areas.

During the year, the Deputy Company Secretary

acted as Secretary to the Committee.

Meetings

In 2023, the Committee held four meetings.

Meetings usually take place ahead of Board meetings

and the Chair of the Committee reports formally

to the Board on the Committee’s proceedings. The

CEO, CFO, Chief R&D Officer, Group Head of Audit,

General Counsel & Company Secretary, Chief Supply

Officer, Group Chief Ethics and Compliance Officer,

Chief Marketing, Sustainability and Corporate Affairs

Officer, Global Head of External Communications

& Affairs, Group Head of Sustainability, Chief

Safety Officer, SVP Head of Global Quality and

the Global Director of Health & Safety, Quality and

Compliance and Corporate Security regularly attend

meetings. Other Directors are invited to attend

all meetings. Other senior management attend

when deemed appropriate by the Committee.

Time is allocated at each meeting for private

discussion with the Chief R&D Officer, Group

Chief Ethics and Compliance Officer, Chief

Supply Officer, Chief Marketing, Sustainability

and Corporate Affairs Officer, Global Head of

External Communications & Affairs, Group Head

of Sustainability and Group Head of Audit without

other invitees being present, as necessary,

aswell as a private meeting of the Committee

members. All Board members are provided

withcopies of Committee papers and minutes.

In addition to reviewing matters at Committee

meetings, the Committee Chair held regular

meetings with our CEO, Chief R&D Officer, Chief

Supply Officer, Chief Marketing, Sustainability

and Corporate Affairs Officer, Global Head of

External Communications & Affairs, Group Head

of Sustainability and Group Chief Ethics and

Compliance Officer, to review progress against

the strategy and to represent the Board in

supporting the efforts in these critical areas.

Committee performance review

This year, a performance review of the

Committee was conducted as part of

the Board’s external performance review

(seepage82). All areas received positive

ratingsoverall, with Committee oversight of

legal compliance and ethics scoring the highest.

TheBoard, having had sight of the results of

theCommittee’s performance review, considers

the Committee to be operating effectively.

Role and responsibilities of the Committee

The Committee is part of the Group’s

governance framework and supports the

Board in fulfilling its oversight responsibilities

in ensuring the integrity of the Group’s

corporate responsibility and sustainability,

ethics and compliance policies, programmes

and activities. Its role and responsibilities are

set out in its terms of reference, which can

be found at www.reckitt.com. We review our

terms of reference annually. During the year,

the Committee’s terms of reference were

reviewed and considered to be appropriate.

The Audit Committee has a monitoring function

inrespect of risk management and internal

controlsystems, which also includes the assurance

framework established by management to

identify and monitor risks identified by the

CRSECCommittee. The Committee liaises with

the Audit Committee and the Chair of the CRSEC

Committee is a member of the Audit Committee.

Standing agenda items reviewed by

theCommittee throughout the year

The Committee has several standing agenda items

which it considers in-line with its terms of reference

and in the context of the Group’s Principal Risks:

– Assessment and recommendations on policies,

processes and procedures for corporate

responsibility, sustainability, compliance

andethical conduct

– Overseeing the Group’s conduct with regard

toits corporate and societal obligations as

aresponsible global citizen on behalf of all

itsstakeholders

– Reviewing and monitoring implementation and

compliance with our Speak Up Policy and review

of insights and trends from reports

– In conjunction with the Audit Committee,

reviewing the Company’s whistle-blowing,

fraudand compliance arrangements, including

the adequacy and security for the workforce to

raise concerns, and the systems and controls for

the prevention of bribery and modern slavery

– Monitoring and reviewing processes for risk

assessment for corporate responsibility,

sustainability, and compliance and

ethicalconduct

– Monitoring targets for corporate responsibility,

sustainability and compliance and ethical

conduct. Reviewing internal and external

reports on progress towards those targets

andKPIs

– Receiving reports from management

committees in respect of corporate

responsibility, sustainability, ethics, and

compliance and investigating and taking

actionin relation to issues raised or reported

98 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Corporate Responsibility, Sustainability, Ethics and Compliance Committee Report continued

Key activities during 2023

FEBRUARY MAY JULY NOVEMBER

Legal compliance & ethics

– Report on data privacy controls

andmaturity assessment

ESG Transition

– Monitoring sustainability targets

– Deep dive on post-consumer recycled

plastics (PCR)

Quality

– Monitoring quality performance

andongoing activities

Changes to Product Regulations

– Product Lifecycle Management (PLM)

– Report on developments

inregulatoryenvironment

Product Safety & Supply

– Product safety performance

Employee Health & Safety

– Performance monitoring

External affairs

– Humanitarian responses

– Social impact and gender

paygapreporting

– Partnerships and thought leadership,

including WiNFund

Legal compliance & ethics

– Third party due diligence

ESG Transition

– Sustainability matters and

targettracking

– Modern Slavery and Human

TraffickingStatement

Quality

– Monitoring quality performance

andongoing activities

Changes to Product Regulations

– REACH regulations

– Review of ongoing regulatory matters

Product Safety & Supply

– Ingredient Steering Group

Employee Health & Safety

– Deep dive on corporate security

External affairs

– Humanitarian responses

– UN Water Conference

– IFCN and marketing practices

Legal compliance & ethics

– Third party due diligence reviews

– Annual compliance training and Code

of Conduct

ESG Transition

– Sustainability matters and

targettracking

Quality

– Monitoring quality performance

andongoing activities

– Deep dive on consumer safety

evolution and maturity

Changes to Product Regulations

– PLM

– Report on developments

inregulatoryenvironment

Product Safety & Supply

– Market access and maintenance

ofproducts, including raw

materialsourcing

Employee Health & Safety

– Performance monitoring

External Affairs

– External affairs activity, including

publicpolicy and advocacy

– COP28

Legal compliance & ethics

– Deep dive on legal and compliance

programme and risks

ESG Transition

– Review of performance against

sustainability targets

Quality

– Monitoring quality performance

andongoing activities

Changes to Product Regulations

– Report on developments

inregulatoryenvironment

Product Safety & Supply

– PLM

Employee Health & Safety

– Employee health and safety

performance and risks

External Affairs

– COP28

– Board Listening Session and

intersectionality between Climate

andHealth

Governance

– Review of Committee terms

ofreference

– Committee performance review

99 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Corporate Responsibility, Sustainability, Ethics and Compliance Committee Report continued

Committee priorities for 2024

– Review the remit and activities of the

Committee within the broader Reckitt

governance framework

– Monitor and prepare for future developments

incorporate governance and non-financial

reporting requirements and review internal

processes, policies and procedures,

toensurecompliance

– Continually review and update the

BoardonReckitt’s quality, safety and

regulatoryresponsibilities

– Assist the Board to review our sustainability

objectives and chart progress against our

targets, including overseeing the Group’s

conduct with regard to its corporate and

societal obligations as a responsible global

citizen on behalf of all stakeholders

– Monitor and review the processes for risk

assessment of key Principal Risks including

inrelation to ESG Transition, Quality, Legal

andCompliance, and Product Regulation

– Maintain responsiveness to global events

impacting consumers, where Reckitt can

provide support and assistance

– Keep abreast of market access conditions and

maintenance of products, given the current

UKpolitical and wider economic landscapes

Pam Kirby

Chair of the Corporate Responsibility, Sustainability,

Ethics and Compliance Committee

Reckitt Benckiser Group plc

21 March 2024

Spotlight on: Legal Compliance &

Ethicsfunction – Risks and Mitigations

In November, the Committee

received an update on the Legal

Compliance & Ethics function’s

ongoing programme and activities.

An annual Ethics & Compliance plan is

developed around key themes, including

enabling responsible business, sustaining

ethical and compliant business as usual

processes, monitoring and training

programmes, data protection governance

and the updating and rollout of policies.

A number of activities were detailed

and their status discussed, including

updates to various global policies and

processes, a revised Code of Conduct,

updates to the annual compliance training

programmes and the launch of a new

Speak Up whistleblowing campaign.

Recent work in collaborating with IT &

Digital on the creation of an Artificial

Intelligence Tools Policy and on

enhancing Reckitt’s responsible data

programme were also considered.

100 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

LETTER FROM THE CHAIR

On behalf of the Board, I am pleased to present

the Directors’ Remuneration Report for the

financial year ended 31 December 2023.

I would like to thank shareholders for their support

of our 2022 Annual Report on Remuneration at our

AGM on 3 May 2023, whichreceived a strong vote

in favour of 93%.

Changes to the Board

During 2023, we announced several changes

tothe Board.

Kris Licht was appointed CEO to succeed Nicandro

Durante. Kris was appointed CEO Designate

on 1 May 2023 and to the Board as Executive

Director effective 1 June 2023, before assuming

the role of CEO on 1 October 2023. Nicandro

Durante remained an employee of the Company

and on the Board until 31 December 2023 to

ensure a smooth transition. Kris was appointed

CEO Designate on a salary of £900,000, which

increased to £1,100,000 upon taking the role of

CEO, in line with the salary paid to Nicandro.

Central to our remuneration

philosophy are the principles of pay

for performance and shareholder,

aswell as strategic, alignment.

Alan Stewart

Chair of the Remuneration Committee

Member

Meetings

attended

Alan Stewart (Chair)

Chair and member for the whole year

55/5

Olivier Bohuon

Member for the whole year

54/5

Jeremy Darroch

Member for the whole year

55/5

Mary Harris

Member for the whole year

55/5

Chris Sinclair

Member for the whole year

55/5

DIRECTORS’

REMUNERATION REPORT

Contents of Directors’ Remuneration Report

100 Letter from the Chair

102 Reckitt’s remuneration at a glance

106 Remuneration Committee governance

108 Annual Report on Remuneration

126 Additional remuneration disclosures

Shannon Eisenhardt was appointed CFO

Designate on 17 October 2023 and will succeed

Jeff Carr as CFO by 31 March 2024. Shannon was

appointed to the Board as Executive Director

upon joining the Company. Shannon previously

served as CFO of Nike Consumer, Brand and

Marketplace. Shannon was appointed on a salary

of £760,000 in line with the salary paid to Jeff.

Ongoing incentive opportunities and LTIP award

levels for Kris and Shannon are in line with the

outgoing individuals. Both Kris and Shannon did

not receive a salary increase on 1 January 2024.

In addition, Sir Jeremy Darroch, currently Senior

Independent Director, will succeed Chris Sinclair

as Chair of the Group Board of Directors in

May following the 2024 AGM. Chris will retire

as Chair and step down from the Board at the

same time. Sir Jeremy will be appointed on the

same terms and fees as Chris. Andrew Bonfield

will succeed Sir Jeremy as Senior Independent

Director upon Sir Jeremy’s appointment as

Chair with effect from the 2024 AGM. I would

like to extend the Board’s and my thanks to

Chris for his membership of the Remuneration

Committee and his time as Board Chair.

As previously announced, I will retire from the

Board at the 2024 AGM. Fiona Dawson CBE will

be appointed to the Board as Non-Executive

Director and Chair Designate to the Remuneration

Committee effective 1 June 2024. In order to

ensure continuity and effective succession,

Mary Harris, former Chair of the Company’s

Remuneration Committee, will be reappointed as

Chair of the Remuneration Committee from the

conclusion of the 2024 AGM until the conclusion

of the Company’s 2025 AGM, upon which Fiona

Dawson will take over. On behalf of the Committee,

I would like to thank Mary and welcome Fiona.

101 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

The remuneration arrangements for both the

outgoing and incoming Directors are in line

with the Remuneration Policy approved by

shareholders with details for Kris and Shannon also

published on announcement. Further details are

set out in the Annual Report on Remuneration.

Performance for the year under review

2023 was a challenging year for many companies

including Reckitt, with continued economic

shocks and geopolitical uncertainties across the

world. Despite these, Reckitt continued to make

progress in 2023, with like-for-like net revenue

(LFL NR) growth of +3.5%, led by growth across

the Hygiene and Health businesses, while Nutrition

began rebasing and held market leadership in the

US. We delivered growth through premiumisation,

household penetration and category creation.

Gross margins returned to historic strength

with adjusted operating profit margin at 23.1%

and adjusted EPS at 323.4p. We also increased

investment in brands and innovation, and launched

a fixed cost optimisation programme. In 2023 we

generated strong free cash flow and significantly

increased cash returns to shareholders, enhanced

by our new, sustainable share buyback programme

announced in October 2023. We have also

proposed a5%increase in our annual dividend,

for the second year in a row, in line with our

policy to deliver sustainable dividend growth.

During the year, we have built strong winning

teams and strengthened our culture, to

harness the things that are special about

Reckitt: our entrepreneurial spirit, passion for

performance, and action orientation. Wehave

gained real credibility on sustainability and

become a significantly more inclusive and

diverse company, which sets us up well as we

continue to drive these through the business.

Performance outcomes for 2023

The Committee carried out a thorough evaluation

of the performance of both the Group and the

Executive Directors in the round, having regard

to broader circumstances to assess whether

the formulaic incentive outturns are appropriate

and justified. Based on the assessment, the

Committee determined that the level of annual

bonus payout and the total vesting level of the

LTIP set out below are appropriate and justified

in this context and that no discretion would be

applied. The framework and the assessment

against performance which the Committee

used are set out in detail on page 110.

Annual bonus

Reckitt operates an annual bonus plan that is

strongly aligned to performance, measured

against targets of NR and adjusted profit before

income tax, with a downward modifier based

onnet working capital (NWC) added from 2023.

NR growth of 3.5% exceeded the initial guidance

and market expectations at the beginning of 2023.

The Health and Hygiene GBUs both delivered LFL

NR growth at the upper end of the medium-term

goal of mid-single-digit growth. The Nutrition GBU

declined in the year as our US business lapped

high and unsustainable comparatives due to a

competitor supply issue from the prior year, but still

performed above initial expectations. This Group

performance resulted ina multiplier towards the

upper end of the NR growth target range. Profit

has exceeded the target range, driven by our NR

performance and strong gross margin expansion.

However, NWC at -7.7% in the year whilst being

industry leading was below targets set and resulted

in a downward modifier of 0.89x being applied to

the outcome. This resulted in an overall payout of

82% of the maximum. This is in line with all other

employees on the same Group-wide measures.

The bonus for Kris and Shannon in respect of

Executive Director services is pro-rated for

the period as an Executive Director. One-third

of bonus payments to Executive Directors

are deferred into Reckitt shares for three

years in line with the Policy. More details are

set out on page 115 of the Annual Report.

2021–2023 LTIP

The Reckitt LTIP is designed to align participants

with shareholders through making awards

with stretching performance conditions

denominated in both performance share options

and performance share awards. Vesting of

awards under the 2021 LTIP was dependent on

LFL NR growth, EPS and ROCE targets. Asset

out in the 2021 Directors’ Remuneration Report,

targets were adjusted for the disposal of

IFCNChina, given the size of that transaction,

to ensure that the new targets were no harder

oreasier to achieve than the original targets.

As a result of good performance over the three

years, NR growth was at 4.8% p.a.. This was close

to maximum of the target range and resulted in a

vesting of 98% of this element. EPS performance

based on both actual and constant FX was

between threshold and maximum, resulting in

vesting of 59% and 46% of maximum for each

element respectively. ROCE performance was

also between threshold and maximum, resulting

in a vesting of 62% of maximum. As set out on

page 116, the overall resultant outcome is that

78% of the total award vests. This outturn follows

two years of zero vesting in 2020 and 2021, 21.5%

vesting in 2022 and 100% vesting in 2023.

In line with our Policy, there is a further

two-year holding period attached to Kris’

andJeff’s LTIP awards. Nicandro and Shannon

did not participate in the 2021 LTIP.

2024 remuneration

Salaries for 2024 for the CEO and CFO are

unchanged from 2023 at £1,100,000 and

£760,000, respectively. The 2024 salary increase

budget for the wider UK employee population

was 5.5% to 6% depending on location.

There are no changes to the bonus opportunity

for the CEO and CFO, remaining at 120%

and 100% of salary at target, respectively.

Performance measures and weightings for

the 2024 annual bonus will be the same as for

2023, being NR and adjusted profit before tax,

with a downward modifier based on NWC.

In line with prior years, the Committee has set the

performance targets at a stretching level having

considered the internal business plan and external

expectations. As in prior years, the Committee will

carry out a thorough assessment of performance

in the round taking into account a wide range

of factors before determining bonus payouts.

There are no changes to the 2024 LTIP awards

including performance measures and weightings.

Performance will continue to be assessed based

on NR growth, ROCE, relative TSR, and ESG

measures, which have been reviewed in light

ofshare price performance, Group performance

and individual performance. Kris’ 2024 LTIP

award will consist of 150,000 performance share

options and 75,000 performance shares and

Shannon’s award will be 80,000 performance

share options and 40,000 performance shares.

These awards will be made in early March 2024

following the full-year results announcement.

Jeff will not receive a 2024 LTIP award.

102 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

Remuneration Policy review

In line with the normal three-year cycle, our

Remuneration Policy is due for renewal at the

2025 AGM. Over the course of 2024 we will

undertake a full review of the Policy and its

implementation, with a view to ensuring that

our remuneration arrangements continue

to appropriately incentivise the delivery of

the strategy and the creation of long-term,

sustainable shareholder value. This will include

review of our incentive structures throughout

the organisation. We will consult with our

shareholders as part of this process.

Conclusion

On behalf of the Committee, I would like

to thank shareholders for their continued

support and engagement during the year.

Wewelcome any comments you may have

onthis report and I look forward to your

support at the upcoming AGM on 2 May 2024.

Finally, I would also like to thank my fellow

Committee members during my tenure as Chair

for their insight and commitment and shareholders

for their invaluable feedback and support.

Alan Stewart

Chair of the Remuneration Committee

Reckitt Benckiser Group plc

21 March 2024

During the year, the Chair and Non-Executive

Director (NED) fees have been reviewed with

regard to increases given to the wider workforce

and market practice. Taking into account the

increased time commitment and responsibilities

of the roles over the last few years, and the

knowledge and skills required to undertake

the roles, the fee for the Chair will increase to

£680,000 and the basic NED fee will increase

to £110,000, with effect from 1 January 2024.

The additional fee for the Senior Independent

Director (SID) will also increase to £35,000.

Thereare no changes to fees for Committee Chair,

Committee member or Designated Non-Executive

Director for Engagement with Company’s

Workforce. 25% of the Chair fee and basic

NED fee continues to be paid in shares. Wewill

continue to review NED fees to ensure they are

appropriate and competitive against the market.

Context for remuneration of the wider workforce

Reckitt is committed to fair and consistent

reward policies for its employees, aligned with

our Compass, remuneration philosophy and our

culture. The Remuneration Committee reviews

various aspects of workforce remuneration

and related policies regularly. In 2023, Reckitt

has made significant developments and

demonstrated further commitment to support

sustainable livelihoods, ensure pay equity

and gender pay gaps are addressed, build

an inclusive culture and facilitate employee

development. The annual employee survey

shows high levels of satisfaction and pride among

Reckitt’s employees and we are recognised

as Top Employers in several markets. For more

information, please refer to pages 120-122.

RECKITT’S REMUNERATION ATA GLANCE

Reckitt strives for leading global performance.

Our management team is multinational and

we compete for talent globally. Central to our

remuneration philosophy are the principles

of pay for performance and shareholder, as

well as strategic, alignment. Combined with

our Compass and business model, these

principles define how decisions are made,

how people act and how we reward them.

To reinforce our philosophy, the majority

of the Executive Directors’ remuneration

packages are made up of variable at-risk pay,

linked to stretching targets that align with

our strategy and shareholder value creation,

and are largely delivered in Reckitt shares.

Inaddition, we have market-leading shareholding

requirements for Executives. This approach is

cascaded throughout our senior leadership.

Context for remuneration at Reckitt

Reckitt’s Compass

Do the

right thing.

Always.

Put consumers

and people first

Build shared

success

Seek out new

opportunities

Strive for

excellence

Reckitt’s strategy

– Purpose and culture fit for the future

– Excellent brand portfolio for value creation

– Scaled global footprint

– Enhanced returns to shareholders

Reckitt’s remuneration philosophy

Pay for

performance

Strategic

alignment

Shareholder

alignment

for more details of our Company strategy.

See pages 8-11

103

Fixed

pay

Variable

pay

92%

APP

(shares)

10%

APP

(cash)

19%

Salary 7%

Pension 1%

LTIP

64%

Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

The tables below illustrate the remuneration principles at Reckitt, which are driven by our Compass,

strategy and the remuneration philosophy

High proportion of variable pay

Maximum CEO pay under the Remuneration Policy

Attract and retain the

best global talent

Note: Value of the CEO’s maximum 2024 package. This

illustrates fixed remuneration plus full payout of the annual

bonus (APP) and full vesting of the LTIP awards including

50%share price growth

1. Based on the average closing share price in Q4 2023

of£55.56

2. Reflecting 50% of the in-employment shareholding

requirement

– Alignment of performance metrics with strategy

– Alignment across the business of metrics

andownership

– Engage highly performance-driven individuals

– Reflect global competitive practice across our

industry peer group

In-employment shareholding requirement

Number

of shares

Value

of shares (£)

% of 2023

annual salary

CEO 200,000 11,112,000 1,010%

CFO 100,000 5,556,000 731%

Post-employment shareholding requirement

Number

of shares

Value

of shares (£)

% of 2023

annual salary

CEO 100,000 5,556,000 505%

CFO 50,000 2,778,000 366%

Market-leading share ownership policy

Ensure alignment with strategy

acrossthe business

Summary of our Remuneration Policy

The table below summarises the current Directors’ Remuneration Policy which can be found on pages

160-167 of the 2021 Annual Report and is also available on our website in the Corporate Governance

section. The Committee is of the view that the current remuneration framework remains fit for purpose

and therefore no changes to the Policy were proposed for 2024.

Year 1 Year 2 Year 3 Year 4 Year 5 Up to Year 10

Fixed pay

Salary,

benefits

and

pension

Annual bonus

(APP)

One-year

performance

period

Two-thirds paid incash; one-third in

Reckitt shares deferred for three years

No further performance conditions

LTIP

Performance shares and

performance share options

Three-year performance period

Two-year holding period

No further performance

conditions

Ten-year life for options from grant

Shareholding

requirements

Period of eight years from appointment to achieve requirements

Two-year shareholding requirement post-departure

104 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Element Key features of operation of policy How will we implement for 2024 Link to strategy

Salary, benefits and pension – Salary increases and pension contribution set in

context of wider workforce

– Salaries and benefits set competitively against peers

– Zero salary increase for CEO and CFO

– CEO and CFO pension contribution of 10% of salary

inline with the wider workforce in the UK

– To enable the total package to support

recruitment and retention

Annual bonus (APP) – Target bonus of 120% of salary for CEO and 100%

forCFO

– One-third deferred into awards over Reckitt shares

for three years

– Malus and clawback provisions apply (incircumstances

including material misstatement of financial results,

gross misconduct and corporate failure)

– Targets set for NR and adjusted profit before

incometax

– NWC target to act as a downward modifier

– Threshold performance results in zero payout,

withmaximum of 3.57x target for truly exceptional

performance on all three metrics

– Remuneration Committee assessment of

performance in the round

– To drive strong performance, with

significant reward for overachievement

ofannual targets linked to Reckitt’s

strategic priorities

– Use of deferral for longer-term

shareholderalignment

LTIP

Performance shares and

performance share options

– Three-year performance period and two-year

holding period

– Malus and clawback provisions apply (in circumstances

including material misstatement of financial results,

gross misconduct, and corporate failure) until two

years after vesting

– Options have approximately seven years to exercise

post vesting

– Targets set for LFL NR growth (40% weighting);

ROCE(25% weighting); relative TSR (25%weighting);

and ESG (10% weighting, split equally between

twometrics)

– Performance conditions are applied to both

performance share options and performance shares

– Remuneration Committee assessment of

performance in the round

– To incentivise and reward long-term

performance and align the interests

ofExecutive Directors with those

ofshareholders

– Two-year holding period for longer-term

shareholder alignment

Shareholding requirements – CEO: 200,000 shares

– CFO: 100,000 shares

– Period of eight years from appointment to

achieverequirements

– Two-year shareholding requirement post-departure

– Promotes long-term alignment

withshareholders

– Promotes focus on management

ofcorporate risks

Directors’ Remuneration Report continued

Purpose and culture

fit for the future

Excellent brand portfolio

for value creation

Scaled global

footprint

Enhanced returns

to shareholders

105 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

Summary of performance and payout

Annual performance plan

The performance outcome for the annual bonus was 82% of maximum. A third of the bonus is deferred,

by way of an award over Reckitt shares.

Performance

measure

Maximum

(3.57x target)

Like-for-like

Net Revenue

£14.07bn

£14.93bn

Actual £14.86bn 1.74x

Adjusted profit

before income tax

at constant rates

£2.85bn 1.89x

Average NWC

0.89x

Threshold

(zero bonus) MultiplierActual/Achieved

Total

2.93x

Achieved

£3.19bn

Actual £3.23bn

-7.4%

-9.6%

Actual -7.7%

2023 base

salary

(£)

Target bonus

opportunity

(% of salary)

Multiplier

achieved

Bonus payout

(% of salary)

Value

delivered

in cash

(£)

Value

deferred

into shares

(£)

Kris Licht 575,000

100%/120%

2.93x 293%/352%

1,230,600 615,300

Shannon Eisenhardt 158,333

100% 2.93x 293% 309,278 154,639

Jeff Carr 760,000 100% 2.93x 293% 1,484,533 742,267

Nicandro Durante 1,100,000 120% 2.93x 352% 2,578,400 1,289,200

1. The 2023 base salary for Kris Licht and Shannon Eisenhardt are pro-rated for the period served as Executive Directors

2. Kris’ target bonus opportunity as CEO Designate was 100% of salary, which increased to 120% of salary on his appointment as CEO

LTIP

The 2021 LTIP vested at 78% of maximum, against the performance conditions over the three-year period.

Performance

measure

Maximum

(100% vesting)

LFL NR growth

(3-year CAGR)

(50% weighting)

0.9% p.a.

4.9% p.a.

Actual 4.8% p.a.

98%

EPS (final year) on an actual

foreign exchange basis

(12.5% weighting)

289p

360p

Actual 323.4p

59%

EPS (final year) on

a constant FX basis

(12.5% weighting)

308p

382p

Actual 332.4p

46%

ROCE (final year)

(25% weighting)

13.7%

15.4%

Actual 14.6%

62%

Threshold

(20% vesting)

Vesting

(% of total award)

Achieved

Total vesting

78%

Achieved

Performance

options

granted

Performance

granted

Total

vesting

Performance

options

vesting

Performance

vesting

Total value

of award

vesting

(£)

Kris Licht

50,000 25,000 78% 39,000 19,500 1,083,420

Jeff Carr 80,000 40,000 78% 62,400 31,200 1,733,472

1. Nicandro and Shannon did not participate in the 2021 LTIP

2. Kris’ LTIP award was granted in relation to his previous role which did not sit on the Board, however, the full value of the award

has been shown for transparency

3. Based on the average closing share price in Q4 2023 of £55.56

106 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

2023 single figure

Kris Licht

£3.62m

Sharon Eisenhardt

£1.24m

Jeff Carr

Nicandro Durante

£4.81m

£5.26m

£m

1 2 43 5 6

Fixed remuneration Annual bonus (shares)

Annual bonus (cash) LTI P Buyout

Executive Director shareholding

Reckitt operates a market-leading shareholding requirement with an eight-year timeframe for

achievement and a two-year post-employment holding period. The chart below illustrates the progress

towards this for the Executive Directors.

Kris Licht

Shareholding

requirement

Current

shareholding

£3.18m

Jeff Carr

Shareholding

requirement

Current

shareholding

£5.24m

Shannon

Eisenhardt

Shareholding

requirement

Current

shareholding

£0.25m

200,0000 25,000 50,000 75,000 100,000 125,000 150,000 175,000

Shares held

Shares deferred from 2023 APP

2024 vesting

1. Current shareholding value based on the average closing share price in Q4 2023 of £55.56

2. Includes shares owned outright and shares subject to post-vesting holding restrictions

3. This is the estimated number of shares awarded, after tax under the Deferred Bonus Plan, including those to be deferred from

the 2023 APP

4. For Kris and Jeff this is the number of shares vesting in May 2024 under the 2021 LTIP, after tax. For Shannon this also includes

the restricted shares from buyout awards vesting in December 2024

Remuneration Committee governance

Committee membership and meeting attendance

The Remuneration Committee is made up entirely of NEDs who are appointed by the Board on the

recommendation of the Nomination Committee. Membership and meeting attendance of the

Remuneration Committee during the year were as follows:

Member Member since Meetings attended

Alan Stewart, Committee Chair February 2022 5/5

Olivier Bohuon January 2021 4/5

Jeremy Darroch November 2022 5/5

Mary Harris May 2017 5/5

Chris Sinclair March 2016 5/5

The Chief Human Resources Officer was Secretary to the Committee throughout the year. Meetings

were also attended by the CEO, CFO and SVP Reward by invitation. Deloitte was the appointed advisor

to the Committee throughout the year. Members of the Remuneration Committee and any person

attending its meetings do not participate in any discussion or decision on their own remuneration.

107 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Reckitt’s Remuneration Policy and the Corporate Governance Code

Reckitt’s Remuneration Policy and practices reflect the philosophy of pay for performance, shareholder

alignment and strategic alignment over the short, medium and long term. When determining the current

Policy and its implementations, Provision 40 of the UK Corporate Governance Code was taken into

account as follows:

Clarity Arrangements are transparent and reflect shareholder alignment and Reckitt’s

strategic priorities, thereby effectively engaging with the wider workforce and

shareholders. The Committee consulted with shareholders as part of the design

phase of the Policy and communicated to the wider workforce details of how

Executive pay is set, its alignment with the Company’s approach to the wider

paypolicy and how decisions are made by the Committee. It also gave employees

the opportunity to ask any questions on these topics.

Simplicity The Policy is simple and clear, comprising fixed pay, such as salary and benefits,

pension schemes that are offered to most of the workforce, plus variable pay

which incorporates the annual bonus, LTIP (performance share options and

performance share awards) and a clear Share Ownership Policy for senior members

of the business. Variable pay is set against financial targets to incentivise short-

and long-term financial performance and alignment with shareholders.

Risk The malus and clawback provisions which apply to annual bonus and LTIP awards

act as a safeguard to the Company and are one mechanism used to help encourage

the right behaviours, which lead to long-term shareholder alignment and sustained

value creation. The Committee has discretion to adjust the formulaic bonus and

LTIP outcomes both upwards and downwards.

Predictability The total of fixed pay and variable pay (target and maximum) illustrated in the

scenarios of total remuneration in our Policy provide an estimate of the potential

future remuneration of the Executive Directors, including the total remuneration

ifa50% share price growth is achieved.

Proportionality There is a clear link between pay for performance and business strategy, with

stretching financial targets applied to annual bonus payouts and LTIP vesting.

Alignment

toculture

Financial targets apply to the annual bonus and LTIP awards across the wider

workforce to drive business performance. These targets are reviewed on an annual

basis. Malus and clawback provisions apply to annual bonus and LTIP, and together

with deferred annual bonus, holding periods and share ownership for the Executive

Directors (and any other relevant senior employees), drive the right behaviours

expected within Reckitt. The remuneration arrangements of the wider workforce

reinforce employee engagement.

Directors’ Remuneration Report continued

The Committee’s role and key activities during the year

The Committee’s purpose is to assist the Board of Directors in fulfilling its oversight responsibility

byensuring that the Remuneration Policy and practices reward fairly and responsibly, are designed

tosupport the strategy and long-term success of the Company and take account of the generally

accepted principles of good governance.

The key activities and decisions made by the Committee during the year are set out below:

Changes to the Board and GEC

Approved the leaving arrangements for Nicandro Durante and JeffCarrand the remuneration

arrangements for Kris Licht and ShannonEisenhardt.

Approved remuneration arrangements for appointments to the GEC.

Wider workforce

Reviewed wider workforce remuneration and related policies.

Reviewed changes to the all-employee share plan launchdates.

Reviewed current shareholdings for senior employees with share ownership requirements.

Internal and external governance

Reviewed 2023 AGM voting, wider market trends, shareholder guidelines and corporate

governance updates.

Reviewed Remuneration Committee terms of reference.

Reviewed Remuneration Committee effectiveness.

Performance outcomes and target setting

Reviewed and approved performance outcomes to 2022 annual bonus and 2020–2022 LTIP, taking

into account wider performance of the Company and Executive Directors.

Approved 2024 annual bonus measures and targets and 2024 LTIP award and performance

measures. Approved 2023 LTIP performance targets.

Determined 2024 remuneration packages for the Executive Directors and GEC members.

Regularly reviewed performance for inflight bonus and LTIP awards.

108 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

ANNUAL REPORT ON REMUNERATION

The rest of this report sets out how we have implemented our Remuneration Policy in 2023, and how

weintend to implement the Policy in 2024.

Remuneration arrangements for the new CEO and CFO

CEO

Kris was appointed as CEO Designate on 1 May 2023 and to the Board as Executive Director effective

1 June 2023 before assuming the role of CEO on 1 October 2023. His remuneration was fully disclosed

upon the announcement of his appointment on 26 April 2023 and in line with the approved Policy.

As CEO Designate Kris received a salary of £900,000 per annum, which increased to £1,100,000 after

taking up the role of CEO, in line with his predecessor. He did not have a salary increase on 1 January

2024. Kris receives a pension allowance of 10% of salary in line with the wider Reckitt workforce in the UK

and other benefits including relocation in line with Reckitt’s benefits and international mobility policies.

As CEO Designate, Kris had a target APP of 100% of salary, which increased to 120% of salary as CEO,

witha maximum multiplier of 3.57x. In line with the Policy, one-third of any bonus will be deferred into

Reckitt shares for a period of three years. Kris will be eligible for an LTIP grant to be made in 2024 of

75,000 performance shares and 150,000 performance share options for the three-year performance

period 2024 to 2026, followed by a two-year holding period. Share awards granted to Kris prior to

hisappointment as CEO Designate in respect of his previous role will continue on their original terms.

These LTIP awards are subject to the same performance measures and targets as the LTIP awards

granted to Executive Directors, full details of which will be provided in the relevant Directors’

Remuneration Report when they vest.

The share ownership requirement as CEO is 200,000 shares and he will be subject to the post-

employment shareholding requirement. There are no buyout awards associated with his appointment.

CFO

Shannon was appointed as CFO Designate on 17 October 2023, joining the Board as an Executive Director

on the same day, and received a salary of £760,000 per annum, in line with her predecessor. Shannon

receives a pension allowance of 10% of salary in line with the wider Reckitt workforce in the UK and

otherbenefits including relocation in line with Reckitt’s benefits and international mobility policies.

Shannon has a target APP opportunity of 100% of salary with a maximum of 3.57 times, with one-third

ofany bonus awarded deferred into Reckitt shares for a period of three years. Her 2023 annual bonus

hasbeen pro-rated based on the portion of the year employed. Shannon received an initial 2023-2025

LTIP grant of 29,453 performance shares and 58,905 performance share options, for the three-year

performance period 2023 to 2025. This has been calculated as a pro-rata award of the CFO’s annual

LTIPaward of 40,000 performance shares and 80,000 performance share options, based on the period

employed during the performance period. All LTIP awards will be subject to a two-year holding period.

The share ownership requirement for Shannon will be 100,000 shares and she will be subject to the

post-employment shareholding requirement.

Shannon has also been granted replacement awards to compensate for remuneration arrangements

forfeited on leaving her previous employer. The terms of the buyout awards substantively replicated

therules of the Company’s LTIP approved by shareholders at the 2015 AGM and are in line with the

current Policy approved at the 2022 AGM. The structure takes into account shareholder guidance and

market practice and they remain subject to performance conditions where appropriate and mirror the

time horizons of forfeited awards. As Shannon is participating in the 2023 Reckitt LTIP, she will not be

compensated for any 2023 LTIP awards made by her previous employer. Details of these awards were

disclosed at the time of the grant and are detailed below. Dividend equivalents will accrue on the awards

and vest at the same time as the relevant award, delivered in shares.

Performance share awards

Performance share awards lapsing due to Shannon’s leaving her previous employer have been replaced

by awards of Reckitt performance shares of equivalent value as follows:

– An award of 3,526 performance shares granted in relation to the long-term incentive award over

Nikeshares granted to Shannon in August 2021 and vesting based on Nike’s performance over the

three-year period to 31 May 2024 as to be disclosed in Nike’s 2024 Proxy Statement. Any shares which

vest following assessment of performance will be released in August 2024 to mirror the time horizons

of forfeited awards

– An award of 5,248 performance shares granted in relation to the long-term incentive award over Nike

shares granted to Shannon in August 2022. Since Shannon had served less than half of the three-year

Nike performance period, to further align her with Reckitt’s performance this award will be subject to

the same performance conditions and targets as the Reckitt 2022 LTIP award. Any shares which vest

following assessment of performance will be released in August 2025 to mirror the time horizons of

forfeited awards

The vesting of these awards will be disclosed in the Annual Report on Remuneration for the relevant year

and included in the single figure table for that year.

Directors’ Remuneration Report continued

109 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Restricted share awards

An award of 5,564 restricted shares were also granted to replace the Nike restricted shares granted in

December 2021, which lapsed upon Shannon’s leaving. The first tranche of 2,782 restricted shares vested

on 10 December 2023 and the second tranche will vest in December 2024. The value of these awards

isincluded in the 2023 single figure table on page 117.

Bonus replacement award

The Nike FY24 bonus for the period from 1 June 2023 to 16 October 2023, being the date before Shannon

joined Reckitt, has also been bought out. The value of this will be based on the average annual bonus

outturn (in % of maximum terms) for the Named Executive Officers excluding the CEO in the Nike 2024

Proxy Statement, pro-rated for time and delivered in cash in line with the original terms of the award.

Thevalue of the FY24 Nike annual bonus will be determined and paid as soon as practicable following

thepublication of the Nike 2024 Proxy Statement. An estimated bonus replacement award value based

on the FY24 Nike target performance is included in the single figure table on page 117.

Shannon also forfeited market value option awards upon leaving her previous employer. These have not

been bought out and replaced at Reckitt as they were underwater when she joined.

Remuneration arrangements for the departing CEO and CFO

CEO

Nicandro Durante stepped down as CEO in October 2023 and remained on the Board as an Executive

Director until 31 December 2023 to ensure a smooth transition, at which time he left the Group.

Nicandrowas paid salary and benefits until his departure date. There is no payment in lieu of notice.

Nicandro is considered a ‘good leaver’ and his incentives have been treated accordingly. Nicandro was

paid an annual bonus in respect of 2023, with two-thirds delivered in cash and one-third is awarded as

Reckitt shares deferred for three years. Any outstanding deferred bonus awards will vest in line with

normal timescales.

Nicandro’s 2022 and 2023 LTIP awards remain subject to performance against the original performance

conditions over the respective three-year performance periods. Both of these awards will be reduced on

a pro-rata basis to reflect the proportion of the performance period employed as an Executive Director.

These will also be subject to a two-year holding period following the end of the respective performance

periods. Nicandro remains subject to the post-employment shareholding requirement.

CFO

Jeff Carr will remain on the Board as an Executive Director until 31 March 2024 to ensure a smooth

transition, at which time he will leave the Group. He will be paid salary, benefits and pension

contributionswhich are unchanged from 2023, until his departure date. There is no payment in lieu

ofnotice. Jeff will receive a capped contribution of £8,000 plus VAT towards legal fees incurred

inconnection with his departure.

Jeff is considered a ‘good leaver’ and his incentives have been treated accordingly. Jeff was paid

anannual bonus in respect of 2023, with two-thirds delivered in cash and one-third in Reckitt shares

deferred for three years. He remains eligible for an annual bonus in respect of 2024 which will be based

on the same performance measures and targets as for the other Executive Directors and pro-rated

based on the portion of the performance year employed. Any bonus awarded will be delivered at

theoriginal dates, with two-thirds in cash and one-third deferred into Reckitt shares for three years.

Anyoutstanding deferred bonus awards will vest in line with normal timescales.

Jeff’s 2021 LTIP award will vest in May 2024 and be subject to a two-year holding period and is not

subject to time pro-rating as he was employed for the full performance period. The 2022 and 2023 LTIP

awards will be pro-rated based on the proportion of the relevant performance period employed and

remain subject to the original performance and time horizons. He will not receive a 2024 LTIP award.

Jeff remains subject to the post-employment shareholding requirement.

2023 performance and remuneration outcomes

In reviewing Executive Director remuneration, the Remuneration Committee took into account

remuneration decisions for the wider workforce and individual performance of the Directors. The

Committee also reviewed market practice, primarily against the FTSE 30 (excluding financial services

companies) and considered an international remuneration peer group which Reckitt competes with for

talent and is subject to similar market forces. Operationally, the international peer group is representative

of the three Reckitt product categories of Hygiene, Health and Nutrition. This comprises 22 companies

asfollows: Abbott Laboratories, Bayer, Campbell Soup, Church and Dwight, Clorox, Coca-Cola, Colgate,

Danone, GSK, Haleon, Henkel, Johnson & Johnson, Kellogg, Kimberly-Clark, Kraft Heinz, Nestlé, Novartis,

PepsiCo, Pfizer, Procter & Gamble, Sanofi and Unilever. This peer group is also used to benchmark

remuneration for the GEC.

Directors’ Remuneration Report continued

110 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Annual bonus in respect of 2023 performance

Executive Director 2023 bonus opportunity

In line with the Remuneration Policy, the CEO and the CFO target bonus opportunities are 120%

ofsalaryand 100% of salary, respectively. Kris Licht’s target bonus opportunity as CEO Designate

was100%of salary. The bonus outcome and payout are calculated as follows:

– For each performance measure a target range is set

– A performance multiplier is calculated for each measure, calculated by the extent to which the

performance for that measure is achieved. These multipliers can be up to 1.89x for outperformance

ofthe stretching range set by the Committee. Net working capital is a downward modifier only and

the multiplier is capped at 1.00x target

– Three individual multipliers are then multiplied together

Net revenue

multiplier

(upto 1.89x)

Adjusted profit

before tax

multiplier

(up to 1.89x)

NWC modifier

(up to 1.00x)

Performance

multiplier

(Threshold = 0x;

target = 1.0x;

max = 3.57x)

– The total performance multiplier can range from zero for performance at threshold or below, to 3.57

for truly exceptional performance. The 3.57 multiplier will only be awarded if maximum performance

isachieved on all metrics (i.e. 1.89 x 1.89 x 1.00)

– This total performance multiplier is then applied to the target bonus opportunity to calculate the

overall formulaic bonus outcome. This is different to usual UK market practice whereby performance

measures are assessed independently and payment under one metric may result in payout regardless

of performance in other metrics. In Reckitt, the three measures combine to give the resultant payout

Cash Shares

Base salary X Target bonus =

Final bonus

outcome

2/3 + 1/3

– The effect of the multiplicative approach means that a high-performance multiplier can only

beachieved for outperformance on both top-line and bottom-line performance, with excellent

management of working capital

– Similarly, underperformance in one of the performance metrics will reduce the overall bonus payout,

even in the case of outperformance of the rest

– For example, if we grow NR above the stretching requirement for maximum performance and

maintainan excellent level of NWC, but fail to meet the profit threshold, the bonus payout will

bezero(i.e. 1.89 x 0 x 1.00)

– One-third of any APP is deferred into an award over Reckitt shares, to strengthen alignment

withshareholders

Directors’ Remuneration Report continued

Assessment of incentive outcomes

The Committee thoroughly evaluates the performance of both the Company and the Executive Directors

in the round to assess whether the formulaic level of annual bonus payout and long-term incentive

vesting are appropriate and justified. The Committee has formalised its approach to this assessment

andthe framework which is applied is illustrated below.

Consider the quality of earnings

Committee to review the results to ensure they reflect the underlying

performance and also consider any exceptional items.

Compare outcome against the shareholder experience

Committee to consider absolute and relative shareholder return over the relevant periods, the

dividend payment(s) and the likely shareholder response to results based on broker feedback.

Compare outcome with overall Company performance

For example, market share, competitor benchmarking, sustainability, people and culture, strategic

progress, wider stakeholder experience and analyst feedback.

Consider any events and other input

For example, reputation/risk related, any change of accounting standards etc.

Draw on input from CRSEC Committee, Audit Committee and management functions

and consider the impact of any external head or tailwinds.

Compare with historical use of discretion

In addition, consider whether bonus and LTIP outcomes are consistent.

What is the formulaic outcome?

Committee to consider year-on-year change, whether this reflects

performance trend and impact on the single figure outcome.

Final APP and LTIP outcomes

Committee to agree whether adjustments are required to formulaic results

and determine the final outcomes for APP payouts and LTIP vesting.

111 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

2023 performance targets

The Remuneration Committee set targets for the Executive Directors prior to the 2023 financial year.

These were based on NR and adjusted profit before income tax, both measured in GBP at a constant FX.

NWC is also used as a downward modifier on both measures. All targets were based on the business

planat the time, with reference also being made to external expectations of performance and market

practice of companies in a similar stage of the business cycle to Reckitt.

At the time the Committee finalised the targets, consensus expectation was 2.6% for LFL NR growth.

Insetting the targets, the Committee also had regard to competitor performance.

2023 financial performance against APP targets

As stated earlier in the annual report, 2023 marked a year of continued progress, with strong mid-single-

digit growth for our Health & Hygiene GBUs and the expected rebasing of our US Nutrition business as

itmaintains market leadership and delivered strong performance, but laps the prior year competitor

supply issue.

LFL NR growth was 3.5% resulting in the bonus metric of £14.86 billion (on a constant FX basis),

significantly exceeding the market expectations when the targets were set.

For 2023, operating margin was 23.1%, in line with guidance, resulting in the bonus metric of adjusted

profit before income tax (on a constant FX basis) of £3.23 billion which outperformed target range

setbythe Committee at the start of the year.

During 2023, NWC was -7.7%. The NWC metric for APP purposes is an Operating NWC andiscalculated as

a 12-month average.

The chart below illustrates performance compared to the targets:

Performance

measure

Maximum

(3.57x target)

Like-for-like

Net Revenue

£14.07bn

£14.93bn

Actual £14.86bn

1.74x

Adjusted profit

before income tax

at constant rates

£2.85bn

1.89x

Average NWC

0.89x

Threshold

(zero bonus) MultiplierActual/Achieved

Total

2.93x

Achieved

£3.19bn

Actual £3.23bn

-7.4%

-9.6%

Actual -7.7%

As illustrated above, 2023 NR was at the upper end of the performance range, and adjusted profit before

income tax exceeded the maximum of the performance range set for the 2023 annual bonus. With a

0.89x modifier on NWC, the overall formulaic bonus multiplier was 2.93x of target (82% of maximum).

These results reflect continued progress in 2023, delivering a four year growth CAGR at the topend of

our peer group during a period of significant market volatility and supply challenges. Total adjusted

diluted EPS was 323.4p in 2023, with FCF increased by 11% to £2.3 billion. Reckitt is well positioned today

to continue to deliver mid-single-digit growth in the medium term. We have an excellent portfolio of

market-leading, high margin brands in growth categories. With the proposed 5% increase in our annual

dividend, we continue to deliver returns to shareholder in line with our capital allocation policy.

Directors’ Remuneration Report continued

112 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Overall Group performance taken into consideration

As it does every year, the Committee thoroughly evaluated the performance of both the Group and the Executive Directors in the round to assess whether the level of annual bonus payout is both appropriate and

justified. The framework that the Committee applies is set out on page 110 and more details including progress on delivery of the strategy, wider people, culture and sustainability is provided below:

Directors’ Remuneration Report continued

Strategic delivery

Purpose and culture fit for the future

– Invested in our people and the values we

want to define them, creating a culture that

ispurposeful, entrepreneurial and caring

– Transformed our capabilities to innovate

great products and extend categories.

Wehave deepened our consumer value

proposition and set new standards in

customer service excellence

– High levels of endorsement from our people

as revealed by the annual employee survey

Excellent brand portfolio for value creation

– Over The Counter products grew by 11%

onaLFL NR CAGR basis compared to 2019

– More than 70% of the brands occupy

market-leading positions in their categories

ona NR basis

– Launched breakthrough products such as

Lysol Air Sanitiser and extended categories

through excellence in innovation

Scaled global footprint

– Scaled global footprint spans in developed

and emerging markets in long-term

growthcategories

– 7.5% 4-year LFL NR CAGR versus 2019 for

developed markets and 6.6% 4-year LFL

NRCAGR versus 2019 for emerging markets

– 260bps increase in share of markets

recognised as top tier by retail partners

Enhanced returns to shareholders

– Delivered LFL NR growth of 3.5% ahead

ofingoing expectations

– Superior industry-leading gross margins

withadjusted operating margin at 23.1%

– Reduced leverage and grew FCF by 11%

to£2.3billion

– Launched new share buyback programme in

October with a goal of buying back £1 billion

of our shares over the following 12 months

– Proposed 5% increase in annual dividend,

forthe second year in a row, with a total

return of £1.5 billion to shareholders

Sustainability

Purpose-led brands

– 29.6% NR from more sustainable products,

improved from 24.4% in 2022, driven by

innovation programme

– 5% PCR plastic inclusion rate with additional

financial commitment to increase this further

– Continued progress in reducing the use

ofvirgin plastic

Healthier planet

– 67% reduction in Scope 1 and Scope 2

emissions compared to our 2015 baseline

– 100% renewable electricity purchased for

manufacturing. Overall 94% of electricity

usedacross all sites is renewable

– 7% reduction in water use and 4% reduction

inenergy use

– Revisions in the water stress mapping

confirmed 17 sites in 2023. Our Hosur site

inIndia became our first water positive site

in2022 and we’re advancing similar projects

near Mysore and in Mexico and Pakistan

– 18% in waste reduction from manufacturing

versus 2015; all manufacturing sites have now

achieved zero waste to landfill

Fairer society

– 23% Group Leadership team, 34% Senior

Management team and 51% managers

arewomen

– £31.4 million Fight for Access social

impactinvestment

113 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Wider stakeholder experience

Suppliers and external partners

– Partnered with the Fair Rubber Association

and Earthworm Foundation to improve the

livelihoods of smallholder latex farmers

inThailand and protect the ecosystem

– Continued to engage palm oil suppliers

through our partnership with Earthworm

Foundation and Action for Sustainable

Derivatives; funded two landscape

programmes in Malaysia and Indonesia as

ameans of addressing risks and investing

inamore sustainable palm supply chain

fromfarm level onwards

– Engaged our third-party manufacturers

through Manufacture 2030 to help them

reduce their environmental footprint through

innovative projects and behavioural changes.

This included the launch of the ‘FMCG

Vertical’ campaign with peer companies

which promoted shared data provision

andaction planning

– Continued to partner with Oxford University’s

NbI team to develop the analytic framework

for assessing carbon, biodiversity and social

impacts in our priority supply chains of latex,

palm oil and fragrances

– Continued to run programmes focusing on

diversity and Human Rights with our suppliers

and external manufacturers

– Continued our programmes of risk-based

supplier audits, helping to strengthen labour

standards in our supply chain

Customers and communities

– Drove customer collaboration with our top

Global customers to deliver Supply Chain

value, improving cost to serve and deliver

improved instock and reliability of service,

which were recognised by top customers

with awards

– Partnered with customers on sustainable

logistics projects; focused on reducing

carbon footprint and increasing productivity

and efficiency

– Continued sales partnerships to improve

efficiency, customer service and logistics

andmeet customer demands

– Supported women entrepreneurs and

innovation via projects such as the WIN Fund

and Climate Gender Equity Fund

Directors’ Remuneration Report continued

People and culture

Pay, recognition and benefits

Our January 2023 global pay review budget

was 70% higher than that of the previous

year. In January 2024, our budget remained

at a broadly similar level to 2023 in line

with our goal to ensure all our colleagues

are paid competitively and fairly, albeit

slightly lower given falling inflation.

We continue to be an accredited Living Wage

Employer and paying at least the Living Wage

to all our UK employees and contractors.

In line with our 2030 Sustainability Ambitions,

our Sustainable Livelihood Framework has

been developed to promote a working

environment supporting health and

wellbeing, equality, employment rights,

financial security and skills development.

In 2022, we formed a partnership with the Fair

Wage Network and conducted analysis across

c.70% of our workforce in our top 10 markets.

In 2023, we extended this to cover all of our

workforce. We are proud to confirm that all our

employees are paid at least the living wage in

their location. We are also embedding this in

our new hire and annual pay review processes.

In 2023, extensive work has been underway to

prepare for the future of pay equity reporting

in Europe with the intention to expand scope

in future years. We already analyse pay equity

data on a mandatory basis in countries including

Australia, Canada, the US and South Africa.

People development

Continued focus on embedding and

cascading the Leadership Behaviours

of Own, Create, Deliver and Care and

celebrated role models in excellence of living

our Leadership Behaviours and Compass

through the Global Compass Awards.

We have transformed our offering in this area,

with the introduction of several initiatives:

– LinkedIn Learning Library: Introduced in April

2023, we have c.9,500 unique users with

c.15,000 hours of combined learning time

across Reckitt

– Functional learning academies: 10 academies

across Reckitt offering technical and

professional qualifications

– myDevelopment – Learning: A new platform

offering personalised development options

– Mentor and coaching programmes: Thriving

programmes, including initiatives for specific

groups such as Accelerate for women and

Global Commercial Future Leadership

Potential programmes to spot and develop

high-potential senior leaders

114 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

Diversity and Inclusion

In 2023, we sharpened our Inclusion strategy

tofocus on three key areas – people, brands

andprocurement.

We undertook and achieved the Global Equality

Standard (GES), a global D&I certification.

The GES uses an assessment framework

developed in partnership with the UK

Government and public and private sector

organisations. We have subsequently achieved

local GES accreditation in Brazil and India.

Our Global ERGs continue to be critical in policy

changes and development programmes,

advocating conscious inclusion and shaping

our innovation process. The ERGs together

have over 50 market chapters enabling us to

respond to local needs and issues that matter.

Over 10,000 people have taken part in our

Conscious Inclusion programme that promotes

the role we all play in creating a more inclusive

workplace. Events on allyship and neurodiversity

and the introduction of new ERGs, including

an LGBTQ+ group in India, underline our

commitment to conscious inclusion.

In 2023, our final score for the Human Rights

Campaign Corporate Equality Index (HRC CEI)

is100 (out of 100). HRC’s CEI rates companies’

levels of LGBTQ+ inclusion.

We are now recognised as a top Global

employer and top 100 employer in the UK for

LGBTQ+ Inclusion by Stonewall. Durex won

Brand Ally of the Year at the Pink News Awards

in 2023 and we achieved a Disability Confident

Level 1 ranking in the UK

for more information on inclusion at Reckitt.

See Our People Report

Employee engagement and wellbeing

We continued with our annual employee

surveyin August 2023 with an overall 87%

response rate.

Some key highlights from this were:

– 80% of our colleagues stated they ‘believe

inand are inspired by our Purpose to protect,

heal and nurture in the relentless pursuit

ofacleaner, healthier world’;

– 82% of us are ‘proud to work at Reckitt’; and

– 82% also agreed ‘we are achievers’.

With high engagement from employees, we

have seen reduced overall voluntary attrition

rate especially for high potential employees

compared to last year. We are proud to be

named a Top Employer in 15 countries –

Bahrain, Canada, China, Germany, Hungary,

Italy, Netherlands, Portugal, Romania, Saudi

Arabia, South Africa, Spain, UAE, UK and USA,

by the Top Employers Institute which has been

reinforced by our annual employee survey

feedback in which 78% of our colleagues

would ‘recommend Reckitt as an employer’

(3% higher than external benchmarks).

Wehave also been named one of The Best

Workplaces for Women 2023 in Australia and

New Zealand, through the trust index survey,

ensuring women feel safe, heard, challenged

and valued. Reckitt was also named a LinkedIn

Top Company in 2023 in the UK and Netherlands.

Our Global Wellbeing Policy recognises mental

health, supported by Employee Assistance

Programmes, webinars and events such

asourGlobal Steps challenge and Mental

Healthmonth.

We continue to host monthly Better Life

webinars to help our people maintain a healthy

lifestyle and work-life balance. A people leader

coaching programme, Coach-On-Demand,

in partnership with HINTSA is now accessible

for everyone, everywhere. Monitoring the

gender pay gap remains a priority and Reckitt

voluntarily discloses the gender pay gap for

our 10 largest markets, covering approximately

70% of our global permanent workforce.

115 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

Decision on 2023 bonus outcomes

Reckitt’s performance showed progress in 2023 despite complex external market conditions. We

exceeded our ingoing NR guidance and worked hard to strengthen our earnings model. We brought our

gross margin back to its historical strength, which in turn enabled us to increase BEI investment (+13%)

behind our brands and support our innovation launches. We generated strong free cash flows and

significantly increased returns to shareholders through our dividend and the start of ournew and

ongoing share buyback programme. Given this performance and wider assessment as described above

and in the Remuneration Chair’s letter, the Committee concluded that the formulaic APP payout based

on performance against targets is justified and no discretion will be applied.

Under the Remuneration Policy, one-third of the annual bonus will be delivered by way of an award over

Reckitt shares and deferred for a three-year period. Kris’ and Shannon’s 2023 APP awards were pro-rated

for the period they served as Executive Directors.

Base salary

(£) X

Target

bonus X

Performance

multiplier =

Total bonus

(£) =

Cash

(£)

Deferred

into shares

(£)

Kris Licht 575,000

100%/120%

2.93x 1,845,900 1,230,600 615,300

Shannon Eisenhardt 158,333

100% 2.93x 463,917 309,278 154,639

Jeff Carr 760,000 100% 2.93x 2,226,800 1,484,533 742,267

Nicandro Durante 1,100,000 120% 2.93x 3,867,600 2,578,400 1,289,200

1. The 2023 base salary for Kris Licht and Shannon Eisenhardt are pro-rated for the period served as Executive Directors

2. Kris’ target bonus opportunity as CEO Designate was 100% of salary, which increased to 120% of salary on his appointment as CEO

Vesting of the 2021 LTIP

The Reckitt LTIP is designed to align participants with shareholders through making awards with

stretching performance conditions denominated in both performance share options and performance

share awards. Kris Licht’s award under his previous role and Jeff Carr’s award were granted under the

previous Remuneration Policy on 28 May 2021. Neither Nicandro nor Shannon participated in the 2021 LTIP

as both they were not employees of the Company at the time of grant.

2021 performance targets

Vesting of awards under the 2021 LTIP was dependent on the performance conditions set out in the table

below. The targets were adjusted for the disposal of IFCN China during 2022 and were disclosed in detail

in the 2021 Directors’ Remuneration Report.

Assessment of performance versus targets

The chart below illustrates performance compared to the targets. As set out below, performance against

performance measures over the three-year performance period results in an overall78% vesting of the

2021 LTIP award. In 2023 an impairment was made in respect of IFCN goodwill, reflecting higher interest

rates and changes in the regulatory environment. For measuring ROCE for LTIPpurpose, capital employed

was not adjusted in order to ensure Management will not benefit from the impairment.

Performance

measure

Maximum

(100% vesting)

LFL NR growth

(3-year CAGR)

(50% weighting)

0.9% p.a.

4.9% p.a.

Actual 4.8% p.a.

98%

EPS (final year) on an actual

foreign exchange basis

(12.5% weighting)

289p

360p

Actual 323.4p

59%

EPS (final year) on

a constant FX basis

(12.5% weighting)

308p

382p

Actual 332.4p

46%

ROCE (final year)

(25% weighting)

13.7%

15.4%

Actual 14.6%

62%

Threshold

(20% vesting)

Vesting

(% of total award)

Achieved

Total vesting

78%

Achieved

116 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

Overall Group performance taken into consideration

As it does every year, the Committee thoroughly evaluated the performance of both the Group and the

Executive Directors in the round to assess whether the level of vesting under the LTIP is both appropriate

and justified. The framework that the Committee applies is set out on page 110. The Committee took into

account the progress on delivery of the strategy and wider people, culture and sustainability in 2023 as

disclosed on pages 112-114 of this report and over the performance period of the 2021 LTIP, as disclosed in

previous Annual Reports, as well as the shareholder experience over this period.

Decision on 2021 LTIP vesting outcome

The Committee is satisfied that this outcome is aligned with the shareholder experience and the wider

assessment of performance over the last three years and concluded that the overall vesting level is

justified and appropriate in this context and that no discretion will be applied.

Vesting of the LTIP for the Executive Directors over the last five years is shown below:

2017–2019 2018–2020 2019–2021 2020–2022 2021–2023

0% 0% 21.5% 100% 78%

Based on the performance assessment above, the 2021 LTIP award to Kris and Jeff will vest as detailed

below. Kris’ LTIP award was granted in relation to his previous role which did not sit on the Board.

However, the full value of the award has been included for transparency. As mentioned previously,

neither Shannon nor Nicandro participated in the 2021 LTIP award.

Interests

held

Exercise

price Vesting %

Interests

vesting

Share price

(£)

Estimated

value

(£)

Kris Licht

Performance shares 25,000 n/a 78% 19,500 55.56 1,083,420

Performance share options 50,000 £64.67 78% 39,000 55.56 0

Jeff Carr

Performance shares 40,000 n/a 78% 31,200 55.56 1,733,472

Performance share options 80,000 £64.67 78% 62,400 55.56 0

1. As the share price on the date of vesting is unknown at the time of reporting, the value is estimated using the average market

value over Q4 2023 of £55.56. The actual value at vesting will be disclosed in the 2024 Annual Report

There is a further two-year holding period attached to the 2021 LTIP award for Kris and Jeff, which means

that vested performance shares (net of tax withholding) will not be released until 1 January 2026, and the

resultant shares (net of any tax withholding and the exercise cost as appropriate) from the exercise of

any vested performance share options will not be released until 1 January 2026.

117 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Single total figure of remuneration for Executive Directors (audited)

The table below sets out a single figure for the total remuneration received by each Executive Director for the year ended 31 December 2023, based on the information set out in the previous sections.

Thisiscompared to the prior year figure:

Current Executive Directors Former Executive Director

Kris Licht

Shannon Eisenhardt

Jeff Carr Nicandro Durante

2023

2022

2023

2022

2023

2022

2023

2022

Base salary 575,000 – 158,333 – 760,000 721,000 1,100,000 363,044

Taxable benefits

57,553 – 192,775 – 16,884 16,817 292,130 199,346

Pension benefit

57,500 – 15,833 – 76,000 72,100 – –

Annual bonus

1,845,900 – 463,917 – 2,226,800 2,573,970 3,867,600 1,555,279

LTIP

7,8

1,083,420 – – – 1,733,472 2,516,000 – –

Buyout awards

– – 411,971 – – – – –

Fixed remuneration 690,053 – 366,942 – 852,884 809,917 1,392,130 562,390

Variable remuneration 2,929,320 – 875,888 – 3,960,272 5,089,970 3,867,600 1,555,279

Total 3,619,373 – 1,242,830 – 4,813,156 5,899,887 5,259,730 2,117,669

1. Kris Licht received an annual salary of £900,000 as CEO Designate on the Board between 1 June 2023 and 30 September 2023. This increased to £1,100,000 upon taking the role of CEO from 1 October 2023. His salary was pro-rated for the period served

asanExecutive Director. Kris Licht’s salary in respect of his employment as President Health and Chief Customer Officer, a role which did not sit on the Board, is not included

2. Shannon Eisenhardt received an annual salary of £760,000 for the period from 17 October 2023 (when she joined Reckitt and the Board) to the end of the year (2.5 months of the year). Her salary was pro-rated for the period since joining the Company

3. Nicandro Durante stepped down as CEO in October 2023 and from the Board on 31 December 2023. Nicandro’s remuneration shown for 2022 relates to services as an Executive Director only

4. Benefits for Kris Licht in 2023 primarily consist of one-off relocation costs, the use of a car, healthcare and tax support. For Shannon Eisenhardt, the benefits include one-off relocation costs including temporary accommodation, the use of a car, home leave

flights, healthcare and tax support. For Jeff Carr, the benefits include a car allowance and healthcare. For Nicandro Durante, this includes mainly one-off relocation costs, the use of a car, healthcare and tax support. Where relevant the costs above include

agross-up for tax

5. The Company paid all current Executive Directors a cash allowance in respect of pension provision to the value shown in the table above. These payments reflect the full pension provision outlined in the Policy Table. Directors are only entitled to pension

onadefined contribution (or cash allowance) basis, with no defined benefit accrual. Nicandro Durante did not receive a pension allowance

6. Annual bonus reflects financial performance at 82% of the maximum level of the performance range set for the 2023 bonus; the Committee’s assessment of performance of both the Company and the Executive Directors in the round, and the Committee’s

determination of the level of annual bonus payout at 82% of the maximum level in line with the formulaic outcome is appropriate as set out on pages 110-115. One-third of this is deferred into share awards for three years and will vest subject to continued

employment. Kris Licht’s annual bonus has been pro-rated for time served as both CEO Designate (annual bonus target of 100% of salary) and CEO (annual bonus target of 120% of salary). Kris Licht’s annual bonus in respect of his employment as President Health

and Chief Customer Officer, a role which did not sit on the Board, is not included. Shannon Eisenhardt’s annual bonus has been pro-rated for time served as CFO Designate

7. Reflects the estimated value of LTIP performance share options and performance shares granted to Kris Licht and Jeff Carr in May 2021, which are due to vest in May 2024 at 78% of maximum. Valued using an average share price over Q4 2023 of £55.56.

Seetherelevant section on page 116 for more details. None of this value is attributable to share price growth over the vesting period. The Committee did not apply discretion in determining the remuneration resulting from the 2021 LTIP vesting. Kris Licht’s LTIP

award was granted in relation to his previous role which did not sit on the Board, however, the full value of the award has been included for transparency. Neither Shannon Eisenhardt nor Nicandro Durante participated in the 2021 LTIP awards

8. The value of the 2022 LTIP vesting for Jeff Carr has been restated from last year, which used an average share price of £58.22 over Q4 2022 to estimate the value of the vesting. The actual value shown above is based on the share price on the date of vesting

of£62.90 on 30 May 2023. As the share price at the date of vesting was lower than the share price at the date of the award, none of the value is attributable to share price growth

9. As part of Shannon Eisenhardt’s recruitment package, she received buyout awards in respect of awards forfeited on leaving her former employer. The value shown in the table relates to both an award of restricted shares (£305,352) and the FY24 Nike annual

bonus award (£106,619). The restricted share awards vest in equal tranches. The first tranche that vested in December 2023 has been valued based on the closing share price of £53.82 at the date of vesting, and the second tranche vesting in December 2024

hasbeen estimated based on the share price at the date of grant, being £55.94. The payment in respect of the FY24 Nike annual bonus is based on Shannon’s target bonus opportunity, pro-rated for the period 1 June to 16 October 2023, for the portion of Nike’s

performance year elapsed until Shannon joined Reckitt, assuming a target payout. As part of this calculation, Shannon’s Nike salary has been converted into pounds sterling using an average Q4 2023 USD:GBP FX of 1:0.806. Shannon was also granted performance

shares awards as part of her buyout – the value of these will be included in the single figure table for the financial period in which the relevant performance period ends

Directors’ Remuneration Report continued

118 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Shareholding of Executive Directors compared to requirements

The bar chart below illustrates the Executive Directors’ shareholding compared to the Company’s

shareholding requirements. Executives have a period of eight years from appointment to achieve the

requirements of 200,000 shares for the CEO and 100,000 for the CFO. All current Executive Directors are

showing expected progress towards meeting these requirements as reflected below:

Kris Licht

Shareholding

requirement

Current

shareholding

£3.18m

Jeff Carr

Shareholding

requirement

Current

shareholding

£5.24m

Shannon

Eisenhardt

Shareholding

requirement

Current

shareholding

£0.25m

200,0000 25,000 50,000 75,000 100,000 125,000 150,000 175,000

Shares held

Shares deferred from 2023 APP

2024 vesting

1. Current shareholding value based on the average closing share price in Q4 2023 of £55.56

2. Includes shares owned outright and shares subject to post-vesting holding restrictions

3. This is the estimated number of shares under the Deferred Bonus Plan, after tax, including those to be deferred from the 2023 APP

4. For Kris Licht and Jeff Carr, this is an estimate of the number of shares vesting in May 2024 under the 2021 LTIP, after tax.

ForShannon, this also includes the restricted shares from buyout awards vesting in December 2024

Executive Directors’ shareholding requirements (audited)

Executive Directors are expected to acquire significant numbers of shares over eight years and retain

these until retirement from the Board, with a portion required to be retained post-employment as

described below.

These shareholding requirements (200,000 shares for the current CEO and 100,000 shares for the current

CFO) are the most demanding in the market and are equivalent to c.1,010% and c.731% of salary for the CEO

and CFO, respectively, based on a share price of £55.56. These requirements are also more than double the

current annual LTIP award using a Black-Scholes valuation of 10% for the performance share options.

We also have post-employment shareholding requirements for a further two years. The post-

employment shareholding requirement is enforced through a restriction on Executive Directors’ vested

shares, held by our external share plan administrator, which requires Company permission before these

shares can be sold. This restriction excludes shares purchased by the Executive Directors.

The two-year post-employment shareholding requirement is 50% of the shareholding requirement or

actual shareholding on leaving if lower. This represents more than c.505% of salary for the CEO and

c.366% for the CFO and is more stretching than the majority of other UK companies’ in-employment

shareholding requirements; it is also greater than the current annual LTIP award.

The table below shows the current shareholding of each Executive Director against their respective

shareholding requirements as of 31 December 2023:

Directors’ Remuneration Report continued

Shareholding

requirement

(number of shares)

Total beneficial

interests

(number of shares)

Shares awarded

under the Deferred

Bonus Plan

Shares subject to

time vesting only

Performance shares Options held

To vest in 2024

Unvested, subject

to performance

Vested but not

exercised To vest in 2024

Unvested, subject

to performance

Kris Licht 200,000 25,995 20,856 10,000 10,335 80,000 50,000 39,000 160,000

Shannon Eisenhardt 100,000 1,471 1,474 1,474 – 38,227 – 58,905

Jeff Carr 100,000 51,069 26,697 – 16,536 80,000 80,000 62,400 160,000

Nicandro Durante

200,000 1,105 17,011 – – 58,333 – – 116,666

1. ‘Total beneficial interests’ includes shares owned outright and shares subject to post-vesting holding restrictions

2. ‘Shares awarded under the Deferred Bonus Plan’ shows the estimated number of shares awarded under the Deferred Bonus Plan, after tax, including an estimate of those to be deferred from the 2023 annual bonus

3. For Shannon Eisenhardt, this is the unvested restricted shares under buyout awards, after tax as detailed on page 109. For Kris Licht, includes the award under the Share Ownership Policy (SOP) granted before his appointment to the Board based on continued

employment and the achievement of shareholding requirements

4. This is an estimate of the number of shares vesting to Kris Licht and Jeff Carr in May 2024 under the 2021 LTIP, as detailed on page 116, after tax

5. For Shannon Eisenhardt, this includes the performance shares granted under buyout awards

6. Nicandro Durante’s shareholding immediately following cessation of employment on 31 December 2023. Since stepping down from the Board on 31 December 2023, Nicandro has been subject to the post-employment shareholding requirements of 100,000 shares

(or his actual holding on leaving if lower) for two years following cessation of employment (to 31 December 2025). Shares purchased by Nicandro are not subject to the post-employment shareholding requirement

119 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

2023 LTIP awards and other awards granted in 2023 (audited)

The table below sets out the LTIP awards and other awards made to Kris Licht, Shannon Eisenhardt, Jeff Carr and Nicandro Durante during 2023. Dividend equivalents accrue on performance shares during the

performance period, but will only pay out on vested performance shares. Vesting of these awards in full requires achievement of stretching performance conditions over the three-year period. In line with the

Directors’ Remuneration Policy, for Executive Directors there is a further two-year holding period for the 2023 LTIP commencing after the end of the three-year performance period. Both Nicandro and Jeff have been

treated as a ‘good leaver’ and their 2023 LTIPs will be pro-rated for the performance period worked as Executive Directors, subject to the same performance conditions and vest according to the original timescales.

Date of grant

Shares over

which awards

granted

Market price at

date of award

(£)

Exercise price

(£)

Face value

(£)

Face value less

exercise price

(£) Performance period Exercise/vesting period Holding period

Performance shares

Kris Licht 21 Mar 2023 40,000 59.18 n/a 2,367,200 n/a 1 Jan 2023–31 Dec 2025 Mar 2026 1 Jan 2028

Shannon Eisenhardt 26 Oct 2023 29,453 55.94 n/a 1,647,601 n/a 1 Jan 2023–31 Dec 2025 Mar 2026 1 Jan 2028

Jeff Carr 21 Mar 2023 40,000 59.18 n/a 2,367,200 n/a 1 Jan 2023–31 Dec 2025 Mar 2026 1 Jan 2028

Nicandro Durante 21 Mar 2023 75,000 59.18 n/a 4,438,500 n/a 1 Jan 2023–31 Dec 2025 Mar 2026 1 Jan 2028

Performance share options

Kris Licht 21 Mar 2023 80,000 59.18 58.28 4,734,400 72,000 1 Jan 2023–31 Dec 2025 Mar 2026–Mar 2033 1 Jan 2028

Shannon Eisenhardt 26 Oct 2023 58,905 55.94 58.87 3,295,146 0 1 Jan 2023–31 Dec 2025 Mar 2026–Mar 2033 1 Jan 2028

Jeff Carr 21 Mar 2023 80,000 59.18 58.28 4,734,400 72,000 1 Jan 2023–31 Dec 2025 Mar 2026–Mar 2033 1 Jan 2028

Nicandro Durante 21 Mar 2023 150,000 59.18 58.28 8,877,000 135,000 1 Jan 2023–31 Dec 2025 Mar 2026–Mar 2033 1 Jan 2028

Buyout awards

Shannon Eisenhardt 26 Oct 2023 2,782 55.94 n/a 155,625 n/a n/a Dec 2023 n/a

26 Oct 2023 2,782 55.94 n/a 155,625 n/a n/a Dec 2024 n/a

26 Oct 2023 3,526 55.94 n/a 197,244 n/a 1 Jun 2021–31 May 2024 Aug 2024 n/a

26 Oct 2023 5,248 55.94 n/a 293,573 n/a 1 Jan 2022–31 Dec 2024 Aug 2025 n/a

1. The market price at date of award is the closing share price on the date of grant

2. The exercise price is based on the average closing share price over the five business days prior to the date of grant

3. For performance shares, the face value is based on the share price at the date of award and assumes the stretching performance criteria are met to achieve full vesting. For performance-based share options, the face value in the table above is calculated as the

number of share options multiplied by the market price at date of award. However, the actual value to a participant at the time of exercise will be the difference between market price at that time and the exercise price for the number of share options vesting,

after the assessment of performance against the stretching performance criteria set. It should be noted that the ‘face value’ shown above would therefore only be realised if the stretching performance conditions are met in full and the share price at the time

ofexercise is double the exercise price

4. These are buyout awards granted to Shannon in respect of legacy awards from her previous employer. The two awards of 2,782 shares are subject to continued employment, the award of 3,526 shares is subject to Nike performance and the award of 5,248 shares

is subject to Reckitt performance

Unchanged from previous years, the Reckitt 2023 LTIP awards are based 40% on NR, 25% on ROCE, 25% on relative TSR and 10% on ESG measures.

NR continues to be measured as LFL growth over three years. ROCE is measured based on the final year of the performance period and is a measure of how efficient the Group is at converting its capital into

earnings. For LTIP purposes ROCE is measured on a constant currency basis. In addition, LTIP targets include impairments prior to the start of the performance period, whereas in the calculation elsewhere in the

Annual Report total assets have been adjusted to add back impairments of Goodwill, except where the impaired asset has been disposed or partially disposed. If there are any impairments during the performance

period, the Committee will ensure that this does not lead to an increase in the vesting by adjusting the capital employed accordingly and to ensure a LFL comparison to the targets. Relative TSR is measured against

a peer group comprising 20 relevant peer companies, with the addition of Haleon from the 2023 LTIP. The targets associated with the 2023 LTIP awards were disclosed in the 2022 Annual Report on Remuneration.

Directors’ Remuneration Report continued

120 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Wider workforce pay arrangements

Reckitt cascades its reward policy fairly and consistently throughout the organisation and the

Remuneration Committee considers the arrangements for the wider workforce when setting

ExecutiveDirectors’ remuneration. During the year, the Committee considered workforce remuneration

and related policies on several occasions, as well as the alignment of incentives and rewards with culture.

Information reviewed by the Remuneration Committee includes salary structures, bonus design and

targets, the LTIP, share ownership, our global mobility policies, provision of benefits and Reckitt’s

all-employee share plans. The Committee is pleased to note from this review that the Company’s

remuneration policies continue to be aligned with those of the Executive Directors, with a cascade

throughout the organisation.

We continued to ensure that all our employees are paid fairly by being an accredited Living Wage

Employer and further developing the Sustainable Livelihood Framework in 2023. We also continued

withvarious initiatives on Diversity and Inclusion, such as the Stronger Together conversations and our

Conscious Inclusion programme. Focusing on further developing our people, we introduced several

learning programmes such as functional learning academies and mentor and coaching programmes.

Employee wellbeing has also been a key area of focus in 2023. We continued to host monthly wellbeing

webinars and introduced a Better Site Life programme for our factory-based colleagues. We also

expanded our people leader coaching programme to everyone and introduced a new Caregivers

Support programme in partnership with HINTSA as well as curated content for moments that matter.

Our annual employee survey gathered an impressive 87% response rate in 2023, revealing key highlights

such as 80% believe in our Purpose, 82% have pride in working at Reckitt, and 82% are in agreement

that‘we are achievers.’ Reckitt was recognised by Top Employers Institute as a Top Employer 2023 in 15

countries, which, coupled with a 78% recommendation rate from our colleagues, demonstrates Reckitt’s

sustained commitment to its employees.

For more details please refer to the People and culture section on pages 113-114.

At Reckitt, we are proud of our people and their achievements, as well as our reward policies and

practices that reflect our values and culture. We continue to focus on maintaining an open, transparent

culture by promoting continuing dialogue across the Company. During 2023, Mary Harris’s activity as the

Designated Non-Executive Director for Engagement with Company’s Workforce has allowed her to feed

back the views of the workforce to the Remuneration Committee as well as the wider Board. Each year

the Company holds several engagement sessions with employees and organises site visits during which

townhall meetings and smaller group discussions with our people take place. Details of this engagement

can be found in the Section 172 Statement, which can be found on pages 76-77.

The table on page 121 summarises the remuneration structure for the wider workforce.

Directors’ Remuneration Report continued

121 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Salary Annual bonus Long-term incentive Pension All employee shares Share ownership Benefits

Salary increases are

based on individual

performance ratings,

talent ratings, and local

market practices and

conditions e.g. inflation.

For 2024, the salary

increase budget for

thewider UK workforce

was 5.5% to 6%.

The average total pay

across the Group in 2023

was £57,057.

The median CEO pay

ratio is 1:99 (page 123).

Reckitt is accredited

bythe Living Wage

Foundation and all our

employees are paid at

least the living wage

intheir location.

Thiscertifies our

commitment to

employees that they

willreceive a wage that

not only exceeds the

minimum wage but also

recognises the actual

cost of living in the UK.

Our APP is consistently

implemented across the

organisation with 16,000

participating employees.

Target bonuses and

maximum multipliers

increase with progression

and promotion.

Bonus payouts, aligned

with Executive Directors,

are tied to Reckitt’s

financial performance.

All employees are

incentivised based on

net revenue and a profit

measure, varying by role.

Most roles include a third

measure, such as NWC.

Additional bonus plans

for specific areas like

sales and factories are

inoperation.

Reckitt grants LTIP

awards to the GEC,

GroupLeadership

teamand Senior

Management team.

Awards under our Middle

Manager High Potential

awards are made to

selected employees

below these levels

toreward long-term

performance and

valuecreation.

The 2024 awards use

thesame measures

andperformance

periodas for the

Executive Directors.

Awards are a fixed

number of options

andshares, based

onemployee level,

performance and

potential. In addition,

participants below the

GEC receive restricted

shares awards. Managers

can recommend

additional awards

tokeyemployees.

A pension/gratuity

scheme is offered to

more than 80% of our

global employees.

Countries where pension

provision is not prevalent

in the local market and/or

is provided by the state

remain an exception to

the above.

In the UK, all Reckitt

employees are eligible

toreceive a Company

pension contribution

ofat least 10% of

pensionable salary,

irrespective of

anypersonal

contributionmade.

We offer a global share

plan for all employees to

buy Reckitt shares at a

discount over three years.

This is offered to over 95%

of our employees globally

where local legislations

permit, and is supported

by a network of 120

localchampions

andcommunicated

in24languages.

At the end of 2023, around

14,000 Reckitt employees

were participating in one

of our three share plans,

with just under a total of

£76 million of employee

savings in our all-employee

share plans, or about

£5,500 on average per

participating employee.

We allow and encourage

a12-month savings

sabbatical for employees

on maternity leave.

Reckitt is proud of our

ownership culture.

Our GEC and Group

Leadership team have

shareholding requirements

with eight years within

appointment to reach target.

These are very demanding

and reviewed annually by the

Remuneration Committee.

Amongst the GEC, the total

shareholding requirement

isaround £56 million

and

theaverage shareholding

requirement among this

group, excluding the CEO,

isc.511% of salary.

Aggregate actual holding

forthe GEC is £26 million

equivalent to an average

of297% of salary.

Total shareholding

requirement for all

employeeswith

requirementsis £86million

equivalent to an average

of401% of salary.

Current actual holding is

£56million

and the actual

average holding is 263%

ofsalary.

We provide regularly reviewed, market-

competitive and inclusive benefits for

allour employees. Core benefits include:

Life insurance for all employees at least

2x base salary.

Global parental leave policy. At least

26weeks paid maternity leave and

fourweeks paid paternity leave.

Employee Assistance Programme in

every country which has helped our

employees during the pandemic and

beyond.

Health insurance for most employees,

where the state does not cover it, with

spouse and/or children also covered in

some markets. Video GP access in the

UKand the US.

International Transfer Policy for global

mobility and career development.

Employees transfer on local terms basis.

Additional benefits for some moves,

suchas international healthcare, pension,

school fees, tax support and home leave.

Directors’ Remuneration Report continued

122 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Salary Annual bonus Long-term incentive Pension All employee shares Share ownership Benefits

Comparison with Executive Director remuneration

Salary increases take

into account the

approach for the wider

workforce. Salaries are

also set competitively

against peers in support

of the recruitment

andretention of

Executive Directors.

The CEO and CFO did

not receive a salary

increase for 2024.

For Executive Directors,

bonuses are directly

related to Reckitt’s

financial performance:

NR, adjusted profit

before income tax

targets, as well as

NWCwhich acts as

adownward modifier

only. APP operates on

amultiplicative basis,

inthe same way as for

the wider workforce.

One-third of annual

bonus payments for

Executive Directors are

subject to a three-year

deferral into awards over

Reckitt shares.

We have malus and

clawback and other

safeguards in place to

manage any potential risk

that may arise from the

use of the APP.

Executive Directors’

LTIPgrants comprise

performance share

options and performance

share awards (based on

afixed number), which

for the 2024 awards

willvest subject

totheachievement

ofLFLNR, ROCE,

relativeTSR and ESG

performance targets.

In addition to the LTIP’s

three-year performance

period, Executive

Directors are subject

toan additional

two-yearholding

periodcommencing

atthe end of the

performance period.

Under the Policy, our

Executive Directors

areeligible to receive

aCompany pension

contribution of 10% of

salary, in line with the

wider workforce in

theUK.

They are eligible to take

this as a cash alternative.

Executive Directors are

eligible to participate

inthe all-employee

Sharesave Scheme on

thesame basis as all

employees.

The Executive Directors have

shareholding requirements

of200,000 shares for the

CEOand 100,000 for the

CFO,themost demanding

requirements in the UK

market

. These are equivalent

to c.1,010% and c.731% of

salary

, respectively.

Executive Directors are

additionally subject to

apost-employment

shareholding requirement

which is enforced through

restrictions put in place by

ourshare plan administrator.

The table on page 118 sets out

the progress of the Executive

Directors towards their

shareholding requirements.

Executive Directors receive benefits

which consist primarily of the provision of

a Company car/allowance, risk insurances

and healthcare.

In addition, Executive Directors are

eligible for the benefits available to the

wider UK workforce.

1. Based on the average closing share price in Q4 2023 of £55.56

2. Compared against constituents of the FTSE 30

Directors’ Remuneration Report continued

123 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Gender pay gap

The Board reviews the Company’s gender pay gap and publishes an annual gender pay report that can

befound on our website under the Fairer Society heading of Our Impact section. To increase transparency

on this issue Reckitt voluntarily discloses the gender pay gap for our 10 largest markets by workforce size,

including the UK, which together make up around 70% of our global permanent workforce.

As disclosed in Our People Report, Reckitt has set targets to increase the number of women insenior

leadership positions and has a number of initiatives to increase this representation.

A summary of the gender pay statistics is also included below:

The gender pay gap in the UK as at 5 April 2023 is

Median -10.6% Mean 3.7%

The gender pay gap in the UK as at 5 April 2022 is

Median -10.8% Mean 2.4%

Further data and information on the initiatives Reckitt is taking on diversity and inclusion are set out in

Our People Report.

CEO pay ratio

The table below provides pay ratios of the CEO’s total remuneration to the remuneration of UK

employees at the lower quartile, median and upper quartile. This is in line with UK reporting requirements.

For 2023, the total pay and benefits paid to both Nicandro Durante and Kris Licht whilst in the role of CEO

have been combined to calculate the total CEO pay for 2023.

CEO Year Method

25th percentile

pay ratio Median pay ratio

75th percentile

pay ratio

2023 Option A 1:136 1:99 1:57

2022 Option A 1:82 1:61 1:34

2021 Option A 1:170 1:121 1:78

2020 Option A 1:244 1:177 1:100

2019 Option A 1:158 1:115 1:70

The calculations reflect the application of Reckitt’s reward policy across the organisation as set out in the

section on wider workforce pay arrangements.

In particular, the Remuneration Committee believes the pay ratio is consistent with the Group’s wider

policies on employee pay, reward and progression. Reckitt ensures that employees are paid fairly for

their role, based on the location they work in and their performance in role. As such, the base salary,

annual bonus and benefits are based on the same principles for the identified employees as they are

forthe CEO. During 2023 Nicandro Durante was CEO until 30 September and Kris Licht was CEO from

1 October; in calculating the CEO pay ratio we have therefore used the aggregate of the amounts paid

toeach of them in respect of their service as CEO. The median pay ratio has increased from 2022 which

reflects the fact that the CEO’s remuneration fluctuates year-on-year as a significant proportion of the

package is variable pay and in 2022 the annual bonus paid to the CEO was lower than 2023.

In calculating the ratio we have used Option A, in line with shareholder guidelines. The employees used

inthe calculations were selected on 5 March 2024 following the end of the financial year.

For identifying the three employees at the lower quartile, median and upper quartile, the following

methodology has been used:

– All UK employees’ total remuneration as at 31 December 2023 has been considered, excluding leavers

and employees who were absent for more than 20 days during the financial year, as these would

distort the ratio

– Full-time equivalent salary, variable pay, allowances and benefits (using the part-time values and

converting these to full-time equivalent values) have been calculated. In order to calculate the value

of taxable benefits we have taken the P11D value, due to ease of accessing data. Actual pension

contributions have been used, and, where appropriate, converted to full-time equivalents

The table below summarises the identified employees in 2023:

25th percentile

(£)

Median pay

(£)

75th percentile

(£)

Total employee pay and benefits 39,069 53,506 93,980

Salary component 29,528 40,845 66,260

In addition, Note 5 to the Financial Statements sets out the total employment costs and average number

of employees globally, during 2023. Based on these, the average global pay during 2023 was £57,057 and

consequently the pay ratio between the CEO and average global employee was 1:93.

Directors’ Remuneration Report continued

124 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Implementation of Directors’ Remuneration Policy in 2024

Salary

As set out earlier in this report, neither the CEO nor CFO received a salary increase for 2024.

Thebudgeted average increase for the UK workforce was 5.5% to 6% depending on location.

TheCEO’ssalary for 2024 is £1,100,000 and the CFO’s is £760,000.

Pension

The CEO and CFO are eligible to receive a pension contribution, or equivalent cash allowance,

of10%ofsalary, which is in line with the Company’s level of contribution for all UK employees.

2024 Annual bonus

There are no changes to the bonus opportunity for the CEO and CFO, remaining at 120% and 100% of

salary at target, respectively. Bonuses for 2024 will remain based on Reckitt’s NR and adjusted profit

before income tax targets, measured in GBP at a constant exchange rate, with the outcome under each

of the measures combined multiplicatively to give a maximum bonus outcome of 3.57x the target bonus

opportunity if both targets are met.

As with the 2023 bonus, the NWC metric will act as a downward modifier, applying on a multiplicative

basis to the combined outcome of the NR and adjusted profit before income tax targets, with a maximum

multiplier of 1x. One-third of any bonus earned will be deferred into Reckitt shares for three years.

As it does every year, the Committee will continue to evaluate the performance of both the Group and

the Executive Directors in the round and with regard to broader circumstances to assess whether the

level of annual bonus payout is appropriate and justified, before determining the final bonus payout.

We have not disclosed the performance target ranges for 2024 as we consider them to be commercially

sensitive. However, we commit to retrospectively disclosing the performance ranges in the Directors’

Remuneration Report for the year ending 31 December 2024.

2024 LTIP awards

Award levels

There are no changes to the LTIP award levels for the CEO or CFO for 2024. These have been reviewed in

light of share price performance, Group performance and individual performance. Kris Licht’s 2024 LTIP

award will consist of 150,000 performance share options and 75,000 performance shares and Shannon

Eisenhardt’s award will be 80,000 performance share options and 40,000 performance shares. These

awards are expected to be made in early March 2024, following the full-year results announcement. Jeff

Carr will not receive a 2024 LTIP award.

Performance conditions

The LTIP performance metrics and their associated weightings are unchanged from the 2023 LTIP awards

and are as follows:

– LFL NR growth (40% weighting)

– ROCE (25% weighting)

– Relative TSR (25% weighting)

– ESG (10% weighting)

The Committee went through a robust process when setting these targets, taking into account a number

of factors and different reference points and the Committee considers that the targets set are very

stretching. Awards granted in 2024 will vest in line with the descriptions below, which require significant

outperformance of targets.

LFL NR growth

NR is measured as LFL growth over three years. At the time these targets were set the Committee took

into account market consensus and our stated ambition for LFL NR growth is mid-single-digit in the

medium term. In this context, the Remuneration Committee believes that the performance ranges are

appropriately stretching and incentivise management to deliver outperformance. 20% of this element will

vest for achieving 2.0% per annum growth increasing to full vesting for achieving 5.0% per annum growth.

ROCE

ROCE is measured in the final year of the performance period and is a measure of how efficient the

Group is at converting its capital into earnings. For LTIP purposes, ROCE is measured on a constant

currency basis. In addition, LTIP targets include impairments prior to the start of the performance period,

whereas in the calculation elsewhere in the Annual Report total assets have been adjusted to add back

impairments of Goodwill, except where the impaired asset has been disposed or partially disposed.

If there are any impairments during the performance period, the Committee will ensure that this does

not lead to an increase in the vesting by adjusting the capital employed accordingly and to ensure a LFL

comparison to the targets. 20% of this element will vest for achieving 14.9% increasing to full vesting for

achieving 16.9%.

Relative TSR

Relative TSR directly aligns LTIP participants with the shareholder experience and will only reward for

TSRoutperformance against our peers.

As it does every year, the Committee reviewed the constituents of the peer group to ensure that they

remain appropriate to assess performance against and also considers whether any additional peers

should be added. The outcome of this review was that all of the current peer companies remain

appropriate and that Kenvue (which was listed as an independent business in 2023) should be added

tothe peer group.

Directors’ Remuneration Report continued

125 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Therefore, the peer group for the 2024 LTIP awards comprises 21 companies with which we compete

forcapital and to which shareholders compare us and is also an appropriate group against which

toincentivise LTIP participants to outperform. The peer companies are primarily drawn from the

constituents of the MSCI World House and Personal Products Index, with others forming part of the

broader ‘FMCG’ industry which are subject to similar industry dynamics and market challenges as Reckitt.

The constituents will be reviewed on an annual basis and, in particular, as new comparators come to the

market. The TSR peer group for the 2024 LTIP award is set out below:

Beiersdorf Estée Lauder Kimberly-Clark Shiseido

Church & Dwight Haleon Lindt Unicharm

Clorox Henkel L’Oréal Unilever

Colgate Palmolive JDE Mondelēz

Danone Kao Nestlé

Essity Kenvue Procter & Gamble

Under the relative TSR measure, 20% of the award will vest for TSR at the median of the peer group,

increasing to full vesting for upper quartile performance or above.

ESG

ESG measures were introduced from the 2022 LTIP to align participants with, and incentivise delivery of,

our 2030 Sustainability Ambitions. There are two equally weighted metrics for the 2024 LTIP award. The

ESG targets are based on rigorous methodology, are independently assured and, in the case of our carbon

emissions, support our delivery of externally validated SBTs on emissions reduction. Targets are based on

achievement in the final year of the performance period and take into account the plans that we have to

achieve the Sustainability Ambitions. The measures and targets are as follows:

i. Percentage of net revenue from more sustainable products – this has been an annual reporting KPI

since 2012 and supports our ambition of 50% of NR being from more sustainable products by 2030.

Thisis measured using our SIC. The calculator evaluates the sustainability impact of every new product

versus existing products and established benchmarks. It helps measure carbon, water, plastics,

ingredients and packaging footprints in new products for our global brands, targeting their reduction

to enable more sustainable products in the future. It includes Scope 3 product emissions (including

thecarbon and water impact from consumer use), which is the most impactful lifecycle stage of our

products. We achieved 29.6% of NR from more sustainable products in 2023 and have set the targets

for this measure based on the Plan to 2030, such that 20% of this element will vest for achieving 43%

ofNR from more sustainable products increasing to full vesting for achieving 46% in 2026.

ii. Percentage reduction in GHG emissions in operations – this supports the delivery of our externally

validated SBTs for 2030 to help maintain global warming at less than 1.5°C, including a 65% reduction

inGHG emissions in operations against our 2015 baseline. For the purposes of reward outcomes,

anyoffsetting activities will not count towards achievement of these targets. A total of 20% of this

element will vest for achieving a 67% reduction in GHG emissions in operations by 2026, increasing

tofull vesting for achieving a 70% reduction. The threshold of a 67% reduction is above the goal that

we set for ourselves by 2030, with the maximum target of a 70% reduction significantly beyond this,

requiring us to exceed our 2030 SBT ahead of schedule. These targets are considered stretching

taking into account internal forecasts.

Summary of 2024 LTIP targets

Performance will be assessed for each measure, at the end of the three-year performance period,

onasliding scale as set out below:

Threshold

(20% vesting)

Maximum

(100% vesting)

LFL NR growth (3-year CAGR)

(40% weighting) 2.0% 5.0%

ROCE (final year) on a constant foreign exchange basis

(25% weighting) 14.9% 16.9%

Relative TSR

(25% weighting) Median Upper quartile

ESG: % of NR from more sustainable products (final year)

(5% weighting) 43% 46%

ESG: % reduction in GHG emissions in operations (final year)

(5% weighting) 67% 70%

Directors’ Remuneration Report continued

126 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

ADDITIONAL REMUNERATION DISCLOSURES

Percentage change in the remuneration of Directors

We are required to publish the annual percentage change in remuneration (salary or fees, benefits and annual bonus) for each Director compared to the annual average percentage change in remuneration for the

employees (excluding Directors) of the Parent Company. Since the CEO and CFO are the sole employees of Reckitt Benckiser Group plc, this statutory disclosure is not possible. In the table below we are therefore

voluntarily disclosing the percentage change in remuneration for all UK employees in order to provide a representative comparison. The Company considers UK employees to be an appropriate comparator group as

the Executive Directors’ remuneration arrangements are similar in structure to the majority of these employees and it reflects the economic environment where the Executive Directors are employed. The analysis

isbased on a consistent set of employees for each comparison, i.e. the same individuals or roles appear in the 2022/23 comparison, and similarly for previous year comparisons.

2022/23 2021/22 2020/21 2019/20

Salary/fee Benefits Bonus Salary/fee Benefits Bonus Salary/fee Benefits Bonus Salary/fee Benefits Bonus

All UK employees

6.5% 1.6%

6.1% 4.1% 2.1%

15.6% 5.9% 6.2%

-8.9% 4.5% 1.5%

505.4%

Chris Sinclair (Chair of the Board) 5.3% – – 10.0% – – 3.6% – – 10.0% – –

Olivier Bohuon

23.2% – – 2.6% – – – – – – – –

Andrew Bonfield

-0.7% – – 6.2% – – 2.4% – – 4.1% – –

Jeff Carr (CFO)

5.4% 0.4% -13.5% 3.0% 0.4% 12.8% 41.5% 37.3% 29.3% – – –

Jeremy Darroch

516.2% – – – – – – – – – – –

Nicandro Durante (former CEO)

139.8% 46.5% 148.7% 178.0% – – 1.9% – – 14.1% – –

Shannon Eisenhardt (CFO Designate)

– – – – – – – – – – – –

Mary Harris -1.6% – – -3.8% – – 2.0% – – 14.4% – –

Tamara Ingram

– – – – – – – – – – – –

Mehmood Khan 3.4% – – 2.6% – – 2.7% – – 4.7% – –

Pam Kirby 2.6% – – 2.0% – – 2.0% – – 7.3% – –

Kris Licht (CEO)

– – – – – – – – – – – –

Alan Stewart

17.2% – – – – – – – – – – –

Elane Stock 3.4% – – 2.6% – – 2.7% – – 4.7% – –

Margherita Della Valle

3.4% – – 2.6% – – 105.4% – – – – –

1. The percentages for ‘All UK employees’ reflect the average percentage change in full-time equivalent salary, taxable benefits and allowances, and bonus for colleagues based in the UK between 2019/20, 2020/21, 2021/22 and 2022/23. It only includes colleagues

employed in both years in the comparison

2. The percentage change in taxable benefits for all UK employees excludes international transfer benefits as this is volatile from year to year based on each individual’s circumstances

3. Olivier Bohuon was appointed to the Board on 1 January 2021 and so no comparison is shown for 2020/21 and 2019/20

4. Andrew Bonfield held the role of Senior Independent Director on an interim basis from 1 September to 31 October 2022. The additional fees for this period are included above

5. Jeff Carr joined on 9 April 2020 as the CFO of the Company so no comparison is shown for 2019/20. The percentage change shown for 2020/21 reflects actual remuneration received during 2020 for service from Jeff Carr’s appointment on 9 April 2020 to

31 December 2020

6. Jeremy Darroch was appointed to the Board on 1 November 2022 and so no comparisons are shown for 2021/22 and before. The comparison for 2022/23 reflects that the 2022 fee was only received for part of the year

7. Nicandro Durante stepped down as a NED on 1 September 2022 and became Executive Director from 2 September 2022. The percentage change figures for 2021/22 and 2022/23 reflect an aggregate of remuneration paid for both his Executive and Non-Executive

roles during 2022

8. Shannon Eisenhardt joined on 17 October 2023 as the CFO Designate of the Company and so no comparison is shown

9. Tamara Ingram was appointed to the Board on 1 February 2023 so no comparison is shown

10. Kris Licht was appointed to the Board as an Executive Director on 1 June 2023 so no comparison is shown

11. Alan Stewart was appointed to the Board on 1 February 2022 and so no comparison is shown for 2021/22 and before. The percentage change figures for 2022/23 reflect that the 2022 fee was only received for part of the year

12. Margherita Della Valle joined on 1 July 2020 so no comparison is shown for 2019/20. The comparison for 2020/21 reflects that the 2020 fee was only received for part of the year

Directors’ Remuneration Report continued

127 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Relative importance of spend on pay

The table below shows shareholder distributions (i.e. dividends and share buybacks) and total employee

pay expenditure for 2022 and 2023, along with the percentage change in both.

2023

(£m)

2022

(£m)

% change

2022/23

Total shareholder distribution

1,546 1,249 23.8%

Total employee expenditure

2,569 2,408 6.7%

1. Details of shareholder distribution are set out in Notes 24 and 28 to the Financial Statements and are made up of dividends of

£1,339 million and share buybacks of £207 million

2. Details of employee expenditure are set out in Note 5 to the Financial Statements

Exit payments made in the year (audited)

Details of Nicandro Durante’s and Jeff Carr’s leaving arrangements are provided earlier in this report.

Payments to past Directors (audited)

No other benefits or payments were delivered to former Directors in the year in excess of the minimum

threshold of a pre-tax value of £15,000 set by the Remuneration Committee for this purpose.

Performance graph

The graph below shows the TSR of the Company and the UK FTSE 100 Index over the period since

1 January 2014. This shows the growth in the value of a hypothetical holding of £100 invested

on31 December 2013. The FTSE 100 Index was selected on the basis that it contains companies

ofacomparable size, in the absence of an appropriate industry peer group in the UK.

TSR since 1 January 2014

£ value of £100 invested at 1 January 2014

Source: Thompson Reuters Datastream

2023 20242014 2015 2016 2017 2018 2019 2020 2021 2022

100

140

160

120

180

101

114

141

118

158

133

162

121

144

142

151

125

166

156

154

168

150

149

166

Reckitt

FTSE 100

The table below sets out the single figure of total remuneration for the role of CEO over the last 10 years.

(£000)

CEO single figure of

remuneration Kris Licht

Nicandro

Durante

Laxman

Narasimhan

Rakesh

Kapoor

Annual

bonus (as a

percentage

of maximum)

LTIP vesting

(as a

percentage

of maximum)

2014 12,787 72% 40%

2015 25,527 100% 80%

2016 15,289 0% 50%

2017 8,999 0% 50%

2018 14,314 84% 65%

2019 4,599

938 12%

2020 8,434

100% 0%

2021 5,967 91% 21.5%

2022 2,118 918 100%

100%

2023 3,619

5,260 82% 78%

1. Includes buyouts in respect of legacy arrangements from previous employer

2. Zero for Rakesh Kapoor

3. Laxman Narasimhan was not with the Group at the time these awards were granted

4. Laxman Narasimhan was not eligible for a 2022 APP following his resignation as CEO

5. Nicandro Durante was a NED at the time these awards were granted and therefore did not receive an award and Laxman

Narasimhan’s award lapsed following his resignation as CEO

6. Includes the LTIP which was granted in relation to Kris Licht’s previous role which did not sit on the Board

7. Nicandro Durante was not with the Group at the time these awards were granted. The awards for Kris Licht were in relation

tohis previous role which did not sit on the Board

Directors’ Remuneration Report continued

128 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Single total figure of 2023 remuneration for NEDs and implementation for 2024 (audited)

The following NED fee policy will apply from 1 January 2024. The table also sets out the fees that were

inplace for the year ended 31 December 2023.

2024 fees 2023 fees

Cash fee

(£)

Fee

delivered in

Reckitt

(£)

Cash fee

(£)

Fee delivered

in Reckitt

(£)

Base fees

Chair of the Board 510,000 170,000 495,000 165,000

Non-Executive Director 82,500 27,500 76,500 25,500

Additional fees

Chair of Committee 35,000 – 35,000 –

Member of Committee 20,000 – 20,000 –

Designated Non-Executive Director for Engagement

with Company’s Workforce 20,000 – 20,000 –

Senior Independent Director 35,000 – 30,000 –

The fee for the Chair of the Board has been increased to £680,000, an increase of 3%. The base fee

forNEDs has been increased to £110,000, an increase of 7.8%. This increase partly reflects the increased

time commitment required to meet the scope and complexity of the NED role over the last few years.

This represents a c. 5.1% to 6.6% increase in total fees, depending on responsibilities. The proportion

delivered in Reckitt shares continues to be 25% of the base fee, being £170,000 for the Chair and £27,500

for the NEDs. We will continue to review NED fees to ensure they are appropriate and competitive

against the market.

In addition, NEDs are eligible to receive support from the Company to complete a UK tax return,

ifrequired.

The table below sets out a single figure for the total remuneration received by each NED for the year

ended 31 December 2023 and the prior year:

2023 fees 2022 fees

Cash

(£)

Total

(£)

Cash

(£)

Total

(£)

Chris Sinclair 495,000 165,000 660,000 470,250 156,750 627,000

Olivier Bohuon 119,833 25,500 145,333 93,500 24,500 118,000

Andrew Bonfield

111,500 25,500 137,000 113,500 24,500 138,000

Jeremy Darroch

126,500 25,500 152,000 24,667 – 24,667

Mary Harris 116,500 25,500 142,000 119,750 24,500 144,250

Tamara Ingram

88,458 23,375 111,833 – – –

Mehmood Khan 96,500 25,500 122,000 93,500 24,500 118,000

Pam Kirby 131,500 25,500 157,000 128,500 24,500 153,000

Alan Stewart

111,500 25,500 137,000 94,458 22,458 116,916

Elane Stock 96,500 25,500 122,000 93,500 24,500 118,000

Margherita Della Valle 96,500 25,500 122,000 93,500 24,500 118,000

1. Andrew Bonfield held the role of Senior Independent Director on an interim basis from 1 September to 31 October 2022.

Theadditional fees for this period are included above

2. Jeremy Darroch joined the Board on 1 November 2022. Fees shown for 2022 are paid from this date

3. Tamara Ingram joined the Board on 1 February 2023. Fees shown are paid from this date

4. Alan Stewart joined the Board on 1 February 2022. Fees shown for 2022 are paid from this date

Travel and expenses for NEDs are incurred in the normal course of business, for example, in relation

toattendance at Board and Committee meetings. The costs associated with these are all met by

theCompany.

Directors’ Remuneration Report continued

129 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Summary of shareholder voting at the 2023 AGM

The following table shows the results of the voting on the 2022 Directors’ Remuneration Report at the

2023 AGM and 2022 Directors’ Remuneration Policy at the 2022 AGM:

Votes for

For

Votes

against

Against

% Total

Votes

withheld

Approve the 2022 Directors’

Remuneration Report 513,944,128 93% 39,845,715 7% 553,789,843 1,961,573

Approve the Directors’

Remuneration Policy 493,637,970 92% 45,472,574 8% 539,110,544 3,364,148

The Remuneration Committee had extensive dialogue with shareholders during 2021 on the 2022

Remuneration Policy, including engaging with shareholders representing more than 50% of our

shareholder register. The majority of shareholders and advisory bodies providing input were supportive

of the changes we made to our Remuneration Policy and this was demonstrated by the high levels of

support received for both the Policy and Annual Report on Remuneration at the 2022 AGM. Following his

appointment as Chair of the Remuneration Committee, Alan Stewart also met with a number of major

shareholders in November 2022.

Directors’ service contracts

NEDs have letters of engagement which set out their duties and time commitment expected. They

areappointed for an initial three-year term, subject to election and annual re-election by shareholders.

Appointments are renewable for subsequent three-year terms by mutual consent. Details are set

outbelow:

Length of service as of

31December 2023

Date of appointment Years Months

Chris Sinclair 10 February 2015 (appointed Chair of the Board on 3 May 2018) 8 11

Olivier Bohuon 1 January 2021 3 0

Andrew Bonfield 1 July 2018 5 6

Jeremy Darroch 1 November 2022 1 2

Mary Harris 10 February 2015 8 11

Tamara Ingram 1 February 2023 0 11

Mehmood Khan 1 July 2018 5 6

Pam Kirby 10 February 2015 8 11

Alan Stewart 1 February 2022 1 11

Elane Stock 1 September 2018 5 4

Margherita Della Valle 1 July 2020 3 6

The CEO and CFO service contracts contain a 12-month notice period. Kris Licht was appointed CEO

Designate on 1 May 2023 and to the Board as Executive Director effective 1 June 2023, before assuming

the role of CEO on 1 October 2023. Shannon Eisenhardt was appointed Executive Director to the Board

and CFO Designate on 17 October 2023. Directors’ service contracts and letters of engagement are

available for inspection at the Company’s registered office.

Advisors

Deloitte LLP (Deloitte) was appointed by the Remuneration Committee as independent advisor

effectivefrom 1 January 2014 following a review of the advisor in late 2013. The Committee

undertakesdue diligence periodically to ensure that Deloitte remains independent of the Company

andthat the advice provided is impartial and objective. Deloitte is a founding member of and

signatoryto the Code of Conduct for Remuneration Consultants, details of which can be found at

www.remunerationconsultantsgroup.com. During 2023, Deloitte LLP also provided the Group with

adviceand compliance support in a number of areas, including corporate, indirect and employment

taxes, global mobility, and advisory and technology consulting.

These services were provided under separate engagement terms and the Committee is satisfied that

the provision of these services did not impair Deloitte’s ability to advise the Committee independently.

Deloitte’s total fees for the provision of remuneration services were £230,000 on the basis of time and

materials. It should be noted that although we are only required to disclose the value of fees for services

which materially assisted the Remuneration Committee, as with previous years, we have disclosed the

full value of remuneration services from Deloitte, which includes advice to management and to the

Remuneration Committee.

Directors’ Remuneration Report continued

130 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ interests in shares and options under the LTIP

and buyout awards (audited)

Grant date At 01.01.23

Granted during

the year

Exercised/vested

during the

year (including

dividend shares)

Lapsed during

the year At 31.12.23

Option price

(£)

Market price at

date of award

(£)

Market price

at date of

exercise/vesting

(£) Exercise/vesting period

Kris Licht

Performance-based share options 01.05.20 50,000 – – – 50,000 65.20 – – May 2023–May 2030

28.05.21 50,000 – – – 50,000 64.67 – – May 2024–May 2031

20.05.22 80,000 – – – 80,000 63.32 – – May 2025–May 2032

21.03.23 – 80,000 – – 80,000 58.28 – – Mar 2026–Mar 2033

Performance-based share awards 01.05.20 25,000 – 25,000 – – – 65.70 62.90 May 2023

28.05.21 25,000 – – – 25,000 – 63.68 – May 2024

20.05.22 40,000 – – – 40,000 – 62.42 – May 2025

21.03.23 – 40,000 – – 40,000 – 59.18 – Mar 2026

Shannon Eisenhardt

Performance-based share options 26.10.23 – 58,905 – – 58,905 58.87 – – Mar 2026–Oct 2033

Performance-based share awards 26.10.23 – 29,453 – – 29,453 – 55.94 – Mar 2026

Buyout awards 26.10.23 – 2,782 2,782 – – – 55.94 53.82 –

Buyout awards 26.10.23 – 2,782 – – 2,782 – 55.94 – Dec 2024

Buyout awards 26.10.23 – 3,526 – – 3,526 – 55.94 – Aug 2024

Buyout awards 26.10.23 – 5,248 – – 5,248 – 55.94 – Aug 2025

Jeff Carr

Performance-based share options 01.05.20 80,000 – – – 80,000 65.20 – – May 2023–May 2030

28.05.21 80,000 – – – 80,000 64.67 – – May 2024–May 2031

20.05.22 80,000 – – – 80,000 63.32 – – May 2025–May 2032

21.03.23 – 80,000 – – 80,000 58.28 – – Mar 2026–Mar 2033

Performance-based share awards 01.05.20 40,000 – 40,000 – – – 65.70 62.90 May 2023

28.05.21 40,000 – – – 40,000 – 63.68 – May 2024

20.05.22 40,000 – – – 40,000 – 62.42 – May 2025

21.03.23 – 40,000 – – 40,000 – 59.18 – Mar 2026

Nicandro Durante

Performance-based share options 06.09.22 150,000 – – 83,334 66,666 64.77 – – May 2025–Sep 2032

21.03.23 – 150,000 – 100,000 50,000 58.28 – – Mar 2026–Mar 2033

Performance-based share awards 06.09.22 75,000 – – 41,667 33,333 – 64.58 – May 2025

21.03.23 – 75,000 – 50,000 25,000 – 59.18 – Mar 2026

1. Vesting of LTIP awards is subject to performance conditions set by the Remuneration Committee and the awards are subject to an additional two-year holding period commencing at the end of the performance period

2. Dividend equivalents accrue on performance shares during the vesting period from the 2022 LTIP awards onwards and will be disclosed on vesting

Directors’ Remuneration Report continued

131 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

Directors’ interests in shares in the Deferred Bonus Plan

(audited)

Grant date At 01.01.23

Granted during

the year

Exercised/

vested during

the year

Lapsed during

the year At 31.12.23

Option price

(£)

Market price at

date of award

(£)

Market price at

date of vesting

(£) Vesting period

Kris Licht

Deferred Bonus Plan 25.03.21 8,059 – – – 8,059 – 64.22 – Mar 2024

Deferred Bonus Plan 21.03.22 5,997 – – – 5,997 – 57.92 – Mar 2025

Deferred Bonus Plan 21.03.23 – 10,041 – – 10,041 – 58.28 – Mar 2026

Jeff Carr

Deferred Bonus Plan 25.03.21 9,163 – – – 9,163 – 64.22 – Mar 2024

Deferred Bonus Plan 21.03.22 13,131 – – – 13,131 – 57.92 – Mar 2025

Deferred Bonus Plan 21.03.23 – 14,721 – – 14,721 – 58.28 – Mar 2026

Nicandro Durante

Deferred Bonus Plan 21.03.23 – 8,895 – – 8,895 – 58.28 – Mar 2026

1. One-third of the annual bonus is delivered in the form of conditional share awards which are deferred for three years

2. Dividend equivalents accrue on deferred bonus shares during the vesting period and will be disclosed on vesting

Executive employees may also participate in the all-employee Sharesave Scheme on the same basis as all other employees. The table below details options held.

Sharesave Scheme Grant date At 01.01.23

Granted during

the year

Exercised during

the year

Lapsed during

the year At 31.12.23

Option price

(£)

Market price

atexercise

(£) Exercise period

Jeff Carr 31.08.21 403 – – – 403 44.56 – Feb 2025–Jul 2025

There have been no changes to the Directors’ interests as set out in the above tables between 31 December 2023 and 21 March 2024.

132 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Directors’ Remuneration Report continued

Directors’ interests in the share capital of the Company (audited)

The Directors in office at the end of the year and those in office at 21 March 2024 had the following

beneficial interests in the ordinary shares of the Company:

21 March

2024

31 December

2023

31 December

2022

Chris Sinclair 14,322 14,322 12,733

Olivier Bohuon 1,149 1,149 931

Andrew Bonfield 1,121 1,121 873

Jeff Carr 51,069 51,069 30,000

Jeremy Darroch 234 234 0

Nicandro Durante

1,105 1,105 1,105

Shannon Eisenhardt

1,471 1,471 –

Mary Harris 3,262 3,262 3,017

Tamara Ingram

215 215 –

Mehmood Khan 1,083 1,083 833

Pam Kirby 5,462 5,462 5,219

Kris Licht

25,995 25,995 13,271

Alan Stewart 427 427 191

Elane Stock 2,992 2,992 2,732

Margherita Della Valle 738 738 504

Marybeth Hays

0 – –

1. Nicandro Durante stepped down from the Board on 31 December 2023 and his interest in shares is shown up to this date

2. Shannon Eisenhardt joined the Board on 17 October 2023

3. Tamara Ingram joined the Board on 1 February 2023

4. Kris Licht joined the Board on 1 June 2023

5. Marybeth Hays joined the Board on 1 February 2024

6. No person who was a Director (or a Director’s connected person) on 31 December 2023 and at 21 March 2024 had any notifiable

share interests in any subsidiary

7. The Company’s Register of Directors’ Interests (which is open to inspection) contains full details of Directors’ shareholdings

and options to subscribe for shares

As approved and signed on behalf of the Board of Directors.

Alan Stewart

Chair of the Remuneration Committee

Reckitt Benckiser Group plc

21 March 2024

This Directors’ Remuneration Report has been prepared in accordance with the provisions of the Companies Act 2006 and

Schedule 8 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (asamended).

Thereport meets the requirements of the FCA Listing Authority’s Listing Rules and the Disclosure Guidance and Transparency

Rules. Inthis report we describe how the principles of good governance relating to Directors’ remuneration, as set out in the

UKCorporate Governance Code (July 2018) (theCode), are applied in practice. The Remuneration Committee confirms that

throughout the financial year the Company has complied withthese governance rules and best practice provisions.

133 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

REPORT OF THE

DIRECTORS

Introduction

We present below our Directors’ Report for

the year ended 31 December 2023. Certain

matters required to be included in this Directors’

Report are included in the Strategic Report

on pages 2 to 61, including an indication of the

likely future developments of the business,

research and development activities of

the Group and details of important events

affecting the Company. TheCorporate

Governance Report can be found on pages62

to 136 and is deemed to be incorporated

into this Directors’ Report by reference.

Further disclosure requirements which are

deemed to form part of the management report

can be found on the following pages of this Annual

Report, and are incorporated into this Directors’

Report by reference:

Acquisitions and disposals 199

Awards under employee share

schemes and long-term

incentive schemes 197-198

Corporate Governance Statement

including internal control and

risk management statements 62-81

Statement of Directors’ Responsibilities,

including disclosure of information

to the Auditor 137

Disclosure of Greenhouse Gas

(GHG) emissions 14; 218-222

Employment policy and

employee involvement 19-21

Engagement with employees,

suppliers, customers and others 37-40; 76-77

Environmental, social

and governance (ESG) matters 14; 47-54

Financial risk management

and financial instruments 181-189

Future developments in the business 2-61

Post Balance Sheet events 200

Research and development activities 22-24

Shareholder information 228-231

Sustainability and

corporate responsibility 14; 47-54

Viability Statement 61

Charitable donations 51-53

Subsidiary undertakings

(including overseas branches) 208-217

Information on the Board’s stakeholder engagement

and activities can be found on pages 37 to 40 and

further information is also set out in the Section 172

Statement, which can be found on pages 76 to 77.

There is no additional information requiring

disclosure under Listing Rule 9.8.4R.

Results and dividends

The Consolidated Income Statement can be

foundon page 156. The profit for the year

attributable toequity shareholders of the

Company amounted to £1,682 million.

The Directors resolved to pay an interim

dividendof 76.6 pence per ordinary share

(2022:73.0 pence), which was paid to

shareholderson 15 September 2023.

The Directors recommend a final dividend for the

year of 115.9 pence per share (2022: 110.3pence)

which, together with the interim dividend,

makesa total dividend for the year of 192.5 pence

per share (2022: 183.3 pence). During the year

no shareholders waived their right to receive

dividend payments. The final dividend, if approved

by the shareholders at the forthcoming Annual

General Meeting (AGM) of the Company, will

be paid on 24 May 2024 to shareholders on the

Directors

Details of the Company’s Directors who served

during the financial year ended 31 December

2023 and details of Directors appointed during

2024 can be found on pages 65 to 68.

The rules governing the appointment and

retirement of Directors are set out in the

Company’s Articles of Association (the Articles)

and all appointments are made in accordance with

the Code. Under the terms of reference of the

Nomination Committee, all Director appointments

must be recommended by the Nomination

Committee for approval by the Board of Directors.

All Directors must submit themselves for re-election

each year at the AGM. With the exception of Chris

Sinclair, Pam Kirby and Alan Stewart, all Directors

will offer themselves for election or re-election

at the 2024 AGM in compliance with the Code.

Details of the Directors standing for election or

re-election can be found in the 2024 Notice of AGM.

Information on the service agreements of

Executive Directors can be found in the

Directors’ Remuneration Report on pages100

to 132. The letters of appointment of the

Non-Executive Directors are available for

inspection at the Company’s registered office.

Powers of Directors

The Board of Directors is responsible for the

management of the business of the Company

and may exercise all powers of the Company

subject to the provisions of the Company’s

Articles and the CA 2006. The Articles contain

specific provisions and restrictions regarding

the Company’s power to borrow money. Powers

relating to the alteration of share capital are also

included in the Articles and shareholders are asked

to renew such authorities each year at the AGM.

A copy of the Articles is available on the

Company’s website at www.reckitt.com or

can be obtained upon written request from

the Company Secretary or the UK Registrar

of Companies, Companies House.

Directors’ insurance and indemnities

The Company indemnifies the Directors and

Officers of the Company and any Group subsidiary

to the extent permitted by Section 236 of CA

2006 in respect of the legal defence costs for

claims against them and third-party liabilities.

The indemnity would not provide cover for a

Director or Officer if that individual was found

to have acted fraudulently or dishonestly.

The Directors’ and Officers’ liability insurance

cover was maintained throughout the year ended

31 December 2023 at the Company’s expense.

134 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Report of the Directors continued

Directors’ interests

A statement of Directors’ interests in the

share capital of the Company is shown on

page 132 of the Directors’ Remuneration

Report. Detailsof Executive Directors’ options

to subscribe for shares in the Company are

included on pages 130 and 131 in the audited

part of the Directors’ Remuneration Report.

During the year, none of the Directors had a

material interest in any derivative or financial

instrument relating to the Company’s shares.

Details of the Directors’ remuneration are

disclosed in the Directors’ Remuneration Report on

pages 126-132. No Director has a material interest

in any ‘contract of significance’ (as defined by the

FCA) to which the Company, or any of its subsidiary

undertakings, is a party as at 31 December 2023.

Share capital

As at 31 December 2023, the Company’s issued

share capital consisted of 736,535,179 ordinary

shares of 10 pence each of which 714,028,649 were

with voting rights and 22,506,530 ordinary shares

were held in treasury. Each share carries the right

to one vote at general meetings of the Company.

Details of changes to the ordinary shares issued

and of options and awards granted during the year

are set out in Note 24 to the Financial Statements.

The rights and obligations attached to the

ordinary shares are contained in the Company’s

Articles. There are no restrictions on the voting

rights attached to the Company’s ordinary shares

or the transfer of securities in the Company

except in the case of transfers of securities:

– That certain restrictions may from time to

timebe imposed by laws and regulations

(forexample, insider trading laws)

– Pursuant to the Listing Rules of the United

Kingdom Listing Authority whereby certain

employees of the Company require the approval

of the Company to deal in the Company’s

ordinary shares

No person holds securities in the Company

which carry special voting rights with regard

tocontrol of the Company. The Company is not

aware of any agreements between holders

of securities that may result in restrictions on

the transfer of securities or on voting rights.

Allotment of shares

At the 2023 AGM, authority was granted to

the Directors under Section 551 of CA 2006 to

allot shares or grant rights to subscribe for, or

convert any security into, shares of the Company.

The authority granted to the Directors will

expire at the conclusion of this year’s AGM.

At the 2024 AGM, a resolution will be proposed

to the shareholders to renew the Directors’

authority to allot equity shares representing

approximately one-third of the Company’s issued

share capital as at the latest practicable date

prior to the publication of the Notice of AGM.

In accordance with the Investment Association

Share Capital Management Guidelines,

Directors will once again seek authority to allot

further ordinary shares, in connection with

apre-emptive offer by way of a rights issue,

up to a further one-third of the Company’s

existing issued share capital on the same

date. The authorities sought would, if granted,

expire at the earlier of six months after the

Company’s next accounting reference date,

orat the conclusion of the AGM of the Company

held in 2025, whichever is the sooner.

Under Section 561 of CA 2006, shareholders have

a right of first refusal in relation to certain issues

of new shares. A special resolution will also be

proposed to renew the Directors’ power to allot

shares in the capital of the Company without

complying with the pre-emption rights in the CA

2006 in certain circumstances up to a maximum

of 10% of the Company’s issued share capital.

This disapplication authority sought is in line

with institutional shareholder guidance and,

inparticular, with the Pre-Emption Group

Statement of Principles issued in November 2023.

This authority will maintain the Company’s

flexibility in relation to future share issues, including

issues required to finance business opportunities,

should appropriate circumstances arise.

Authority to purchase own shares

Authority was granted to the Directors at the 2023

AGM for the purposes of Section 701 of CA 2006 to

repurchase shares in the market and this authority

remains valid until the conclusion of this year’s AGM.

On 25 October 2023, the Company announced,

consistent with its capital allocation framework,

a £1 billion share buyback programme to be

carried out over 12 months (the Programme).

On 30 October, the Company announced

the commencement of the first tranche of

that Programme to return up to £250 million

to shareholders, and which completed on

30 January 2024. On 20 December 2023,

theCompany announced the second

trancheof the Programme to return a

furtherup to £250 million to shareholders,

and which commenced on 1 February 2024.

During the financial year ended 31 December 2023,

the Company purchased in aggregate 3,782,835

ordinary shares of 10 pence each and subsequently

transferred them to treasury. The total cost of

the shares purchased during the financial year

ended 31 December 2023 was £207 million.

Afurther 4,303,628 ordinary shares have been

repurchased between 1 January 2024 and the

date of this Report at a total cost of £233 million.

As at the date of this Report there are 27,645,021

ordinary shares held in treasury (representing

3.89% of the issued ordinary shares) for the

purposes of satisfying the Company’s obligations

under employee equity incentive schemes.

Shares held in treasury are not eligible to

participate in dividends and do not carry

anyvoting rights.

At the 2024 AGM, the Directors will seek to renew

the authority granted to them. Such authority,

if approved, will be limited to a maximum of

70,880,000 ordinary shares, representing less

than 10% of the Company’s issued ordinary share

capital (excluding treasury shares) calculated as

at the latest practicable date prior to publication

of the Notice of AGM, and sets the minimum

and maximum prices which may be paid.

135 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Report of the Directors continued

Change of control and significant agreements

There are a number of agreements that take

effect, alter or terminate upon a change of

controlof the Company following a takeover.

Theshareholder agreement between the

Company and JAB Holdings B.V. (JAB) at the

timeof the merger in 1999 entitled JAB to

nominate Board Directors.

A holding in excess of 20% or 10% of the

Company’s ordinary shares entitles JAB

tonominate two Directors or one Director

respectively. JAB’s current holding is below

thisamount and there is currently no nominated

Director on the Board. None of these are deemed

to be significant in terms of their potential impact

on the business of the Group as a whole.

There are no significant agreements between the

Company and its Directors or employees providing

for compensation for loss of office or employment

that occurs because of a takeover bid, except

that provisions of the Company’s share plans may

cause options and awards granted under such

plans to vest on a takeover, and if the employment

of an Executive Director or other employee is

terminated by the Company following a takeover

then there may be an entitlement to appropriate

notice and/or compensation as provided in

applicable contracts or terms of employment.

There is no information that the Company is

required to disclose about persons with whom it

has contractual or other arrangements with, which

are essential to the business of the Company.

Employees

During 2023, the Group employed over 40,000

(2022: 40,000) employees worldwide, of whom

5,038 (2022: 4,870) were employed in theUK.

The Group is committed to the principle of equal

opportunity in employment: no applicant or

employee receives less favourable treatment on

the grounds of nationality, age, gender, religion,

race, ethnicity, disability, sexual orientation or

any other protected characteristics. Employment

applications are considered on the basis of

aptitude and ability, and fair consideration is given

to all applications regardless of nationality, age,

gender, religion, race, ethnicity, disability, sexual

orientation, or any other protected characteristics.

We have issued specific guidance on inclusive

recruitment practices for managers with

hiring responsibilities. Where an employee

has an existing disability or becomes disabled

during their employment, practical efforts are

made to assist the employee in continuing

their employment and arranging appropriate

support such as workplace adjustments.

All employees, are treated in a fair and inclusive

way throughout their careers, whether

that means accessing training, learning and

development opportunities and career

progression. Further details of our Inclusion

and Anti-Harassment policies can be found

at www.reckitt.com and on pages 19-21.

It is essential to the continued improvement

in performance, efficiency and productivity

throughout the Group that each employee

understands the Group’s strategies, policies and

procedures. Open and regular communication

with employees at all levels is an essential part

of the performance management process.

On-the-job learning and continuous development

take place throughout the year, with all employees

having a formal annual Performance Development

Review with their line manager to discuss business

objectives and create a Personal Development

Plan. This is also an important opportunity for

employees to discuss their ongoing development

and career ambitions. Weencourage continuous

development conversations throughout the

year. These annual reviews also provide a

way of identifying candidates for our Future

Leader Development Programmes.

The Group operates multi-dimensional two-way

internal communications programmes which

include the provision of a Group intranet and

the publication of regular Group newsletters.

Opinions of employees are sought on a variety

of issues through mechanisms including global

surveys, opinion polls, team meetings and

feedback forums. Further information on the

Group’s employee engagement activities

is included on pages 19-21, 38 and 77.

We regularly check in with our employees

through townhall meetings and our intranet.

We also hold forums, focus groups and

listening sessions with leaders to give us

timely insights on topics which matter most.

A continuing programme of learning and

development reinforces the Group’s commitment

to employee development. The Group

recognises the importance of employee health

and wellbeing as set out on pages 19 to 21.

Reckitt’s Leadership Behaviours are vital

to how we embed our culture and achieve

strong and sustainable performance. We have

defined leadership behaviours that capture

our uniqueness, capitalise on our strengths and

challenge us to do better. At Reckitt, we Own,

Create, Deliver and Care. These behaviours are

for everyone in the organisation and are part

of our annual performance and development

reviews. We create an inclusive environment for

employees to act with integrity, responsibility

and consistency in line with our Purpose, Fight

and Compass set out on pages 8 and 19-21.

Employee matters, incentives

andshareownership

Group incentive schemes reinforce financial and

economic factors affecting the performance

of the business. Employees typically have

three to five performance objectives which

are directly linked to their job and their specific

contribution to the overall performance of the

Group. In addition, presentations, videos and

Q&A sessions are held for employees around

the world on publication of the Group’s financial

results to provide employees with awareness of

the financial and economic factors affecting the

Company’s performance, and so that employee

views are fed back to management and taken

into account when decisions are made.

The Company operates three all-employee

share plans. Through these schemes, the Board

encourages employees to become shareholders

and to participate in the Group’s employee share

ownership plans, should they wish. Savings-related

share plans covering most of the world give

employees the opportunity to acquire shares in

the Company by means of making regular savings.

We currently have just under 14,000 colleagues

participating in one of Reckitt’s all-employee

share plans. Further details on our all-employee

share plans and awards made under executive

share plans can be found in Note 24 on pages

196 to 198 of the Financial Statements.

136 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Report of the Directors continued

Political donations

During the year, the Company and its subsidiaries did not make any political donations or incur

anypolitical expenditure, nor were any contemplated. In keeping with previous practice, at the

forthcoming AGM shareholders will be asked to approve, on a precautionary basis, for the Company

andits subsidiaries to make political donations and incur political expenditure for the period ending

31 December 2024.

Financial instruments and risk

The financial risk management objectives and policies of the Group are set out in Note 15, from page 181

of the Financial Statements. The Note sets out information on the Company’s policy for hedging each

major type of forecasted transactions for which hedge accounting is used, and our exposure to currency,

price risk, credit risk, liquidity risk and cash flow risk in relation to the use of financial instruments.

Amendment to Articles of Association

The Articles of the Company were adopted in 2012 and amended in 2015 and 2021. Any amendments

tothe Articles may be made in accordance with the provisions of CA 2006, by special resolution

oftheshareholders.

Independent Auditor

The External Auditor, KPMG, has indicated its willingness to continue in office and a resolution proposing

the reappointment of KPMG, and to authorise the Audit Committee to determine its remuneration

for the financial year ending 31 December 2024, will be proposed at the forthcoming AGM.

Substantial shareholdings

As at 31 December 2023, the Company had received the following notices of substantial interests

(3%ormore) in the total voting rights of the company:

Holder Notification Interest Rights

Massachusetts Financial Services Company 16 January 2013

Indirect 5.00

Morgan Stanley Investment Management Limited 20 October 2022

Direct 5.04

1. Under a Section 793 CA 2006 request, Massachusetts Financial Services Company confirmed on 17 January 2024 that

itsaggregate holding had decreased. The voting percentage was not disclosed

2 Under a Section 793 CA 2006 request, Morgan Stanley Investment Management Limited confirmed on 24 January 2024 that

itsaggregate holding had decreased. The voting percentage was not disclosed

As at 15 March 2024, the company has not received any further notifications under DTR 5 of the

Disclosure Guidance and Transparency Rules.

Application of the UK Corporate Governance Code 2018

We report against the requirements of the Code issued by the Financial Reporting Council. Details of how

the Company has applied the Code principles and provisions can be found in the Corporate Governance

Report on pages 62 to 132.

Annual General Meeting (AGM)

The forthcoming AGM of Reckitt Benckiser Group plc will be held on Thursday, 2 May 2024 at 2pm at the

London Heathrow Marriott Hotel, Bath Road, Hayes, Middlesex UB3 5AN.

A separate Notice of Meeting, setting out the resolutions to be proposed to shareholders, is available at

www.reckitt.com/investors/annual-general-meetings/. The Board considers that each of the resolutions

is in the best interests of the Company and its shareholders as a whole. The Directors unanimously

recommend that shareholders vote in favour of all the resolutions, as they intend to do so in respect

oftheir own beneficial holdings.

By Order of the Board

Catheryn O’Rourke

Company Secretary

Reckitt Benckiser Group plc

21 March 2024

103-105 Bath Road

Slough, Berkshire

SL1 3UH

Company registration number: 6270876

Legal Entity Identifier: 5493003JFSMOJG48V108

137 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

In respect of the Annual Report and Financial Statements

The Directors are responsible for preparing

the Annual Report and the Group and Parent

Company financial statements in accordance

with applicable law and regulations.

Company law requires the Directors to prepare

Group and Parent Company financial statements

for each financial year. Under that law, we are

required to prepare the Group financial statements

in accordance with UK-adopted international

accounting standards and applicable law and have

elected to prepare the Parent Company financial

statements in accordance with UK accounting

standards and applicable law (UK Generally

Accepted Accounting Practice), including FRS 102,

the Financial Reporting Standard applicable in the

UK and Republic of Ireland. The Group, in addition

to complying with its legal obligation to apply UK-

adopted international accounting standards, has

also applied IFRS Accounting Standards as issued by

the International Accounting Standards Board (IASB).

Under company law the Directors must not

approve the financial statements unless they are

satisfied that they give a true and fair view of the

state of affairs of the Group and Parent Company

and of the Group’s profit or loss for that period. In

preparing each of the Group and Parent Company

financial statements, the Directors are required to:

– select suitable accounting policies and then

apply them consistently;

– make judgements and estimates that are

reasonable, relevant and reliable and, in respect

of the Parent Company financial statements

only, prudent;

– for the Group financial statements, state

whether they have been prepared in

accordance with UK-adopted international

accounting standards and, due to a requirement

of the US SEC, state they have been prepared

inaccordance with IFRS Accounting Standards

as issued by the IASB;

– for the Parent Company financial statements,

state whether applicable UK accounting

standards have been followed, subject to any

material departures disclosed and explained

inthe Parent Company financial statements;

– assess the Group and Parent Company’s

abilityto continue as a going concern,

disclosing, as applicable, matters related

togoing concern; and

– use the going concern basis of accounting

unless they either intend to liquidate the Group

or the Parent Company or to cease operations,

or have no realistic alternative but to do so.

The Directors are responsible for keeping

adequate accounting records that are sufficient

to show and explain the Parent Company’s

transactions and disclose with reasonable

accuracy at any time the financial position ofthe

Parent Company and enable them to ensure

that its financial statements comply with the

Companies Act 2006. They are responsible

for such internal controls as they determine

are necessary to enable the preparation of

financial statements that are free from material

misstatement, whether due to fraud or error,

and have general responsibility for taking

such steps as are reasonably open to them to

safeguard the assets of the Group and to prevent

and detect fraud and other irregularities.

Under applicable law and regulations, the Directors

are also responsible for preparing a Strategic

Report, Directors’ Report, Directors’ Remuneration

Report and Corporate Governance Statement that

complies with that law and those regulations.

The Directors are responsible for the maintenance

and integrity of the corporate and financial

information included on the Company’s website.

Legislation in the UK governing the preparation

and dissemination of financial statements may

differ from legislation in other jurisdictions.

In accordance with Disclosure Guidance and

Transparency Rule (DTR) 4.1.16R, the financial

statements will form part of the annual financial

report prepared under DTR 4.1.17R and 4.1.18R.

The external auditor’s report on these financial

statements provides no assurance over whether

the annual financial report has been prepared

in accordance with those requirements.

Responsibility statement of the Directors

inrespect of the annual financial report

Each of the Directors, whose names and functions

are listed on pages 65 to 68 of the Annual Report,

confirm that to the best of their knowledge:

– the financial statements, prepared in

accordance with the applicable set of

accounting standards, give a true and fair

viewof the assets, liabilities, financial position

andprofit or loss of the Company and the

undertakings included in the consolidation

takenas a whole; and

– the Annual Report and financial statements

include a fair review of the development and

performance of the business and the position

ofthe issuer and the undertakings included in

the consolidation taken as a whole, together

with a description of the principal risks and

uncertainties that they face.

We consider the Annual Report and financial

statements, taken as a whole, is fair, balanced

and understandable and provides the

information necessary for shareholders to

assess the Group and Parent’s position and

performance, business model and strategy.

In the case of each Director in office at the

date the Directors’ report is approved:

– so far as we are aware, there is no relevant audit

information of which the Group’s and Parent’s

auditors are unaware; and

– we have taken all the steps that we ought

tohave taken as a director in order to

makeourselves aware of any relevant audit

information and to establish that the Group and

Parent’s auditors are aware of that information.

On behalf of the Board

Catheryn O’Rourke

Company Secretary

Reckitt Benckiser Group plc

103-105 Bath Road

Slough, Berkshire

SL1 3UH

21 March 2024

STATEMENT OF DIRECTORS’

RESPONSIBILITIES

138 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Independent Auditor’s Report

To the members of Reckitt Benckiser Group plc

1. Our opinion is unmodified

In our opinion:

– the financial statements of Reckitt Benckiser Group plc give a true and fair view of the state of the

Group’s and of the Parent Company’s affairs as at 31 December 2023, and of the Group’s profit for

the year then ended;

– the Group`s financial statements have been properly prepared in accordance with UK-adopted

international accounting standards;

– the Parent Company`s financial statements have been properly prepared in accordance with UK

accounting standards, including FRS 102 The Financial Reporting Standard applicable in the UK and

Republic of Ireland; and

– the Group and Parent Company financial statements have been prepared in accordance with the

requirements of the Companies Act 2006.

Additional opinion in relation to IFRS Accounting Standards as issued by the IASB:

– As explained in Note 1 to the Group financial statements, the Group, in addition to complying with

its legal obligation to apply UK-adopted international accounting standards, has also applied IFRS

Accounting Standards as issued by the International Accounting Standards Board (“IASB”).

– In our opinion the Group financial statements have been properly prepared in accordance with

IFRS Accounting Standards as issued by the IASB.

What our opinion covers

We have audited the Group and Parent Company financial statements of Reckitt Benckiser Group plc

(“the Company”) for the year ended 31 December 2023 (“FY23”) included in the Annual Report, which

comprise:

Group (Reckitt Benckiser Group plc and its subsidiaries) Parent Company (Reckitt Benckiser Group plc)

Group Income Statement, Group Statement of

Comprehensive Income, Group Balance Sheet,

Group Statements of Changes in Equity, Group

Cash Flow Statement and Notes 1 to 33 to the

Group financial statements, including the

accounting policies in note 1.

Parent Company Balance Sheet, Parent Company

Statement of Changes in Equity and Notes 1 to 12

to the Parent Company financial statements,

including the accounting policies in Note 1.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and

applicable law. Our responsibilities are described below. We believe that the audit evidence we have

obtained is a sufficient and appropriate basis for our opinion. Our audit opinion and matters included in

this report are consistent with those discussed and included in our reporting to the Audit Committee.

We have fulfilled our ethical responsibilities under, and we remain independent of the Group in accordance

with, UK ethical requirements including the FRC Ethical Standard as applied to listed public interest entities.

2. Overview of our audit

Factors driving our view of risks

Following our FY22 audit, and considering developments affecting the Group since then, we have

updated our risk assessment.

The risk of impairment associated with the IFCN CGU has increased since last year due to the impact of

higher interest rates on the discount rate, and increased uncertainty over forecast growth assumptions in

light of the return of a key competitor to market and increased regulatory pressures in the US.

We also identified a new Key Audit Matter for FY23 associated with the accounting treatment of the

purchase of the remaining interests in the Group’s majority owned entities in mainland China and Hong

Kong (“RB Manon”) from its existing minority shareholders. The risk focuses on the judgement applied in

allocating the total amount payable between the purchase of the non-controlling interest which is taken

to equity in FY23, and services provided by the minority shareholders which are charged to the income

statement over the service period.

We have assessed that the risk relating to contingent liabilities has increased from FY22 following an

adverse verdict in the first NEC case. This increases the probability of outflow of economic benefit and

increases the level of judgement involved in the ability to reliably estimate any such outflow.

We have not observed a change in the level of risk in relation to the remaining Key Audit Matters.

Our risk assessment also considered compliance with laws and regulations, specifically those that could

reasonably be expected to have a material effect on the financial statements.

Our risk assessment also considered compliance with laws and regulations, specifically those that could

reasonably be expected to have a material effect on the financial statements.

Key Audit Matters Vs FY22 Item

Recoverability of IFCN CGU’s goodwill and indefinite life intangible assets 5.1

Recoverability of Biofreeze CGU’s goodwill and indefinite life intangible assets 5.2

Revenue recognition in relation to trade spend arrangements and associated accruals 5.3

Contingent liabilities arising from the US litigation concerning Necrotising Enterocolitis

(NEC) and the amendment to the South Korean Humidifier Sanitiser (HS) law

5.4

Accounting for the forward purchase of shares held by the non-controlling interest of

“RB Manon”

New 5.5

Provisions for uncertain tax positions 5.6

139 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Independent Auditor’s Report continued

Recoverability of the Parent Company’s investment in Reckitt Benckiser Limited 5.7

Audit Committee interaction

During the year, the Audit Committee met five times. KPMG attend all Audit Committee meetings and are

provided with an opportunity to meet with the Audit Committee in private sessions without the

Executive Directors being present. For each Key Audit Matter, we have set out communications with the

Audit Committee in section 5, including matters that required particular judgement for each.

The matters included in the Audit Committee Chair’s report on page 88 are materially consistent with our

observations of those meetings.

Our Independence

We have fulfilled our ethical responsibilities under, and we remain independent of the Group in

accordance with, UK ethical requirements including the FRC Ethical Standard as applied to listed public

interest entities.

We have not performed any non-audit services during FY23 or subsequently which are prohibited by the

FRC Ethical Standard.

We were first appointed as auditor by the shareholders for the year-ended 31 December 2018.The period

of total uninterrupted engagement is for the 6 financial years ended 31 December 2023.

The group engagement partner is required to rotate every 5 years. As these are the second set of the

Group’s financial statements signed by Andrew Bradshaw, he will be required to rotate off after the FY26

audit.

The average tenure of partners responsible for component audits as set out in section 8 below is 2 years,

with the shortest being 1 and the longest being 6. There were no key audit partners with tenure over 5

years.

Total audit fee £19.4m

Audit related fees (including interim review) £0.9m

Other services £0.4m

Non-audit fee as a % of total audit and audit related fee % 6.4%

Date first appointed 3rd May 2018

Uninterrupted audit tenure 6 years

Next financial period which requires a tender 2028

Tenure of Group Engagement Partner 2 years

Average tenure of component signing partners 2 years

Materiality

(item 7 below)

The scope of our work is influenced by our view of materiality and our assessed risk of material

misstatement.

We have determined overall materiality for the Group`s financial statements as a whole at £140m (FY22:

£130m) and for the Parent Company’s financial statements as a whole at £70m (FY22: £65m).

Consistent with FY22, we determined that normalised profit before tax from continuing operations

(“PBTCO”) remains the most appropriate benchmark for the Group. Reckitt Benckiser Group plc is well

established and operates in a stable environment across multiple geographies. Therefore, users of the

financial statements will be primarily interested in profitability of the Group and its ability to generate

returns for shareholders, of which the most relevant benchmark is PBTCO. As such, we based our group

materiality on normalised PBTCO, of which it represents 4.5% (FY22: 4.1%).

Materiality for the Parent Company’s financial statements was determined with reference to a

benchmark of Parent Company total assets of which it represents 0.46%% (FY22: 0.45%).

0 25 50 75 100 125 150

130

140

Group Materiality

105

Group Performance Materiality

Highest Component Materiality

Parent Company Materiality

Lowest Component Materiality

Audit Misstatement

Posting Threshold

FY22 £mFY23 £m

2. Overview of our audit continued

140 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Independent Auditor’s Report continued

Group scope

(item 8 below)

We have performed risk assessment and planning procedures to determine which of the Group’s

components are likely to include risks of material misstatement to the Group’s financial statements, the

type of procedures to be performed at these components and the extent of involvement required from

our component auditors around the world.

The Group operates in more than 60 countries across six continents with the largest market being the United

States of America. The Group is organised into three Global Business Units: Hygiene, Health and Nutrition.

We scoped the audit by obtaining an understanding of the Group and its environment and assessing the

risk of material misstatement at the group and component level.

We have considered components on the basis of their contribution to net revenue, total normalised

profits and losses that made up profit before tax and total assets.

Of the Group’s 380 (FY22: 406) reporting components, we instructed 52 components (FY22: 53) across

23 countries (FY22: 23 countries) to perform full scope audits for group purposes and two components to

perform specified audit procedures (FY22: one).

The components within the scope of our work accounted for the percentages illustrated opposite.

Our scoping provided 81% coverage of net revenue (FY22: 79%), 87% coverage of total assets (FY22:

85%), and 78% coverage of profits and losses that made up profit before tax (FY22: 77%).

In addition, we have performed group level analysis on the remaining components to determine whether

further risks of material misstatement exist in those components.

We consider the scope of our audit, as communicated to the Audit Committee, to be an appropriate

basis for our audit opinion.

Coverage of group financial statements

80%

Net revenue

19%

86%

Total assets

13%

67%

22%

Profit before tax

11%

Full scope audits Specified audit procedures

Remaining components

The impact of climate change on our audit

In planning our audit, we have considered the potential impact of risks arising from climate change on the

Group’s business and its financial statements. The Group has set out its targets as part of their 2030

Sustainability Ambitions, which include energy, emissions, water, waste and packaging related metrics.

This includes two targets validated by the Science Based Targets initiative (“SBTi”) to reduce absolute

operational Scope 1 and 2 GHG emissions by 65%, absolute product carbon footprint emissions by 50%

both by 2030 from a 2015 base year. Other targets aim to reduce water use per tonne of production by

30% by 2025 from a 2015 base year, increase the use of renewable electricity to 100% by 2030 and for

100% of plastic packaging to be recyclable or reusable by 2025. Further information is provided in the

Strategic Report on page 47 and in the Sustainability Performance Review on page 14.

Whilst the Group has set these targets, in note 1 to the consolidated financial statements the Directors

have stated that they have considered the impact of climate change risks and that they do not believe

that there is a material impact on the financial reporting judgements and estimates and as a result the

valuations of the Group’s assets and liabilities have not been significantly impacted by these risks as at

31 December 2023.

As a part of our audit we have performed a risk assessment to determine if the potential impacts of

climate change may materially affect the financial statements and our audit. We did this by making

enquiries of management and inspecting internal and external reports in order to independently assess

the climate-related risks and their potential impact. We held discussions with our own climate change

professionals to challenge our risk assessment.

The most likely potential impact of climate risk and plans on these financial statements would be on the

forward-looking assessments of non-current assets.

We have considered the sensitivity of the assumptions used in the impairment testing of goodwill and

indefinite-life intangible assets. Given that the climate change related assumptions are not considered a

major source of estimation uncertainty, the carrying amounts of these assets in the financial statements

are not considered to be materially sensitive to the impact of risks arising from climate change. We

considered the impact of ESG related costs on the value in use of the Group’s CGUs, the impact of such

costs on cash flows is minimal and not considered a key assumption when assessing impairment. We

have considered the impact of climate change targets on the fair value of pension assets, however given

the nature of the assets being primarily bonds and insurance contracts, this has not been considered to

be a key assumption in the valuation. We have also considered the costs and consumer preferences

impact of climate change as part of our consideration of the going concern basis of preparation.

We determined that climate related risks do not have a significant impact on our audit or key audit

matters. We have read the Group’s disclosures of climate related information in the Strategic Report and

the Group’s TCFD Summary on page 218 and considered consistency with the financial statements and

our audit knowledge.

2. Overview of our audit continued

141 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Independent Auditor’s Report continued

3. Going concern, viability and principal risks and uncertainties

The Directors have prepared the financial statements on the going concern basis as they do not intend

toliquidate the Group or the Parent Company or to cease their operations, and as they have concluded

that the Group’s and the Parent Company’s financial position means that this is realistic. They have also

concluded that there are no material uncertainties that could have cast significant doubt over their ability

to continue as a going concern for at least a year from the date of approval of the financial statements

(“the going concern period”).

Going concern

We used our knowledge of the Group, its industry, and the general economic environment to identify the

inherent risks to its business model and analysed how those risks might affect the Group’s and Parent

Company’s financial resources or ability to continue operations over the going concern period. The risks

that we considered most likely to adversely affect the Group’s and Parent Company’s available financial

resources and metrics relevant to debt covenants over this period were:

– The failure to identify, assess and proactively respond to new or changing regulations could result in

increased regulatory scrutiny, costly product reformation or product recalls, potential litigation and

removal of the license to sell a product.

– A reliance on limited number of suppliers, geographic concentration, or an excessive dependence on

specific routes, sub-suppliers or technologies could render the supply chain vulnerable to disruption.

– Geopolitical events, including threats of conflict, trade wars, economic sanctions and political

polarisation, could disrupt operations.

– Failure to identify or respond to a product quality and/or safety issue may result in potential consumer

harm or death, financial settlements, costly recalls and reputational damage.

– Reliance on a few key manufacturing sites to produce products exposes the Group to unexpected

shutdown at one of these sites.

– Adverse economic conditions, together with high level of volatility and unpredictability in the

macroeconomic environment, could impact consumer demand for the Group’s brands.

We considered whether these risks could plausibly affect the liquidity or covenant compliance in the

going concern period by comparing severe, but plausible downside scenarios that could arise from these

risks individually and collectively against the level of available financial resources and covenants

indicated by the Group’s financial forecasts.

Our procedures also included an assessment of whether the going concern disclosure in note 1 to the financial

statements gives a complete and accurate description of the Directors’ assessment of going concern.

Accordingly, based on those procedures, we found the Directors’ use of the going concern basis of

preparation without any material uncertainty for the Group and Parent Company to be acceptable.

However, as we cannot predict all future events or conditions and as subsequent events may result in

outcomes that are inconsistent with judgements that were reasonable at the time they were made, the

above conclusions are not a guarantee that the Group or the Parent Company will continue in operation.

Our conclusions

– We consider that the Directors’ use of the going concern basis of accounting in the preparation of the

financial statements is appropriate;

– We have not identified, and concur with the Directors’ assessment that there is not, a material

uncertainty related to events or conditions that, individually or collectively, may cast significant doubt

on the Group’s or Parent Company’s ability to continue as a going concern for the going concern

period;

– We have nothing material to add or draw attention to in relation to the Directors’ statement in note 1

tothe financial statements on the use of the going concern basis of accounting with no material

uncertainties that may cast significant doubt over the Group and Parent Company’s use of that basis for

the going concern period and we found the going concern disclosure in note 1 to be acceptable; and

– The related statement under the Listing Rules set out on page 137 is materially consistent with the

financial statements and our audit knowledge.

Disclosures of emerging and principal risks and longer-term viability

Our responsibility

We are required to perform procedures to identify whether there is a material inconsistency between

the Directors’ disclosures in respect of emerging and principal risks and the viability statement, and the

financial statements and our audit knowledge.

Based on those procedures, we have nothing material to add or draw attention to in relation to:

– the Directors’ confirmation within the Viability Statement on page 61 that they have carried out a

robust assessment of the emerging and principal risks facing the Group, including those that would

threaten its business model, future performance, solvency and liquidity;

– the Principal and Emerging Risks disclosures describing these risks and how emerging risks are

identified and explaining how they are being managed and mitigated; and

– the Directors’ explanation in the Viability Statement of how they have assessed the prospects of the

Group, over what period they have done so and why they considered that period to be appropriate,

and their statement as to whether they have a reasonable expectation that the Group will be able to

continue in operation and meet its liabilities as they fall due over the period of their assessment,

including any related disclosures drawing attention to any necessary qualifications or assumptions.

We are also required to review the Viability Statement set out on page 61 under the Listing Rules.

Our work is limited to assessing these matters in the context of only the knowledge acquired during our

financial statements audit. As we cannot predict all future events or conditions and as subsequent

events may result in outcomes that are inconsistent with judgements that were reasonable at the time

they were made, the absence of anything to report on these statements is not a guarantee as to the

Group’s and Parent Company’s longer-term viability.

142 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Our reporting

We have nothing material to add or draw attention to in relation to these disclosures.

We have concluded that these disclosures are materially consistent with the financial statements and our

audit knowledge.

4. Emphasis of matter: Uncertain outcome of NEC litigation

We draw attention to notes 9, 20 and 33 which disclose that the Group is subject to product liability

actions in the United States in relation to alleged links between one of its infant formula products and

Necrotising Enterocolitis (NEC), a gastrointestinal condition in preterm infants. On 13 March 2024 an

adverse legal ruling awarded one plaintiff $60 million in the only trial to date. The Directors have

disclosed a contingent liability in respect of these matters, no amounts are included within provisions

and no related net cash outflows have been included in the value in use of the related IFCN CGU.

Our opinion is not modified in respect of this matter.

5. Key audit matters

What we mean

Key audit matters are those matters that, in our professional judgement, were of most significance in the

audit of the financial statements and include the most significant assessed risks of material misstatement

(whether or not due to fraud) identified by us, including those which had the greatest effect on:

– the overall audit strategy;

– the allocation of resources in the audit; and

– directing the efforts of the engagement team.

We include below the key audit matters in decreasing order of audit significance together with our key

audit procedures to address those matters and our results from those procedures. These matters were

addressed, and our results are based on procedures undertaken, for the purpose of our audit of the

financial statements as a whole. We do not provide a separate opinion on these matters.

5.1 Recoverability of the goodwill and indefinite life intangible assets relating to the IFCN CGU (Group)

Financial Statement Elements

FY23 FY22

Goodwill and indefinite life intangible assets (IFCN) £5,104m £6,231m

Impairment charge (IFCN) £810m –

Our assessment of risk vs FY22

Vs FY22

Our assessment is that the risk has increased compared to FY22 due to the impact of

higher interest rates on the discount rate, and increased uncertainty over forecast growth

assumptions in light of the return of a key competitor to market and increased regulatory

pressures in the US.

Our results

FY23: Acceptable

FY22: Acceptable

Description of the Key Audit Matter

The risk: forecast-based assessment

The recoverability of goodwill and indefinite life intangible assets relating to the Infant and Child Nutrition

(“IFCN”) cash generating unit (“CGU”) is assessed using value in use which is based on forecast financial

information within a discounted cash flow model (“the IFCN Model”).

Key assumptions in the IFCN Model include the discount rate, forecast financial performance, in particular

net revenue and margin growth, and external factors impacting forecast category growth and terminal

growth rates.

In the current year the Group recognised an impairment charge against goodwill relating to the IFCN CGU

of £810m (FY22: nil), reflecting the impact of higher interest rates on the discount rate, and increased

uncertainty over net revenue and margin growth assumptions in light of the return of a key competitor to

market and increased regulatory pressures in the US.

The effect of these matters is that, as part of our risk assessment, we determined that the recoverable

amount of the IFCN CGU, and consequently the impairment charge, has a high degree of estimation

uncertainty with a potential range of reasonable outcomes greater than our materiality for the financial

statements as a whole, and possibly many times that amount.

We also identified a fraud risk related to the estimation of the recoverable amount of the goodwill and

intangible assets relating to the IFCN CGU in response to possible pressures on the Group to realise value

from significant acquisitions.

Independent Auditor’s Report continued

3. Going concern, viability and principal risks and uncertainties continued

143 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Our response to the risk

Our procedures to address the risk included:

Sensitivity analysis: We considered the sensitivity of the recoverable amount of the goodwill and

intangible assets relating to the IFCN CGU to reasonably possible changes in assumptions and focused

our attention on those assumptions which we considered the most critical to the recoverable amount of

the IFCN CGU.

Benchmarking assumptions: In response to the risk of fraud, we evaluated the net revenue growth

assumptions in the IFCN Model with reference to historic performance and external market data relating

to projected growth for the relevant categories.

We critically challenged the Group’s assumptions relating to forecast market shares, considering

recovery of a key competitor’s supply shortages in the North American market, through comparison to

historical trends and external data sources.

We benchmarked margin and other costs assumptions against historical achievement, external cost

inflation growth forecasts and our assessment of the Group’s historic ability to achieve productivity

savings. We also benchmarked the terminal growth rate assumption against market forecasts.

Personnel interviews: We compared judgements made centrally to discussions we held directly with the

relevant members of the Global Business Unit and country management. We considered and challenged

the Group’s assumptions and corroborated these views with the Group’s in-market teams.

Valuation expertise: Using our own valuation specialists, we challenged the appropriateness of key

assumptions underlying the estimation of the recoverable amounts of the goodwill and intangible assets

relating to the IFCN CGU, this included the discount rate used in the IFCN Model. We assessed whether

the premium applied to the discount rate was appropriate considering the inherent forecasting

uncertainty. We also benchmarked the recoverable amount of the IFCN CGU using implied earnings

multiples to comparable companies and historic transactions within the industry, as well as considering

latest market conditions.

Assessing transparency: We assessed whether the Group’s disclosures in note 9 of the sensitivity of the

outcome of the impairment assessment to changes in key assumptions reflected the risks inherent in the

recoverable amount of goodwill and indefinite life intangible assets relating to the IFCN CGU.

We performed the tests above rather than seeking to rely on any of the Group’s controls because the

nature of the balance is such that we would expect to obtain audit evidence primarily through the

detailed procedures described.

Communications with the Reckitt Benckiser Group plc’s Audit Committee

Our discussions with and reporting to the Audit Committee included:

– Our approach to audit of the impairment assessment of goodwill and indefinite life intangible

assets relating to the IFCN CGU, including details of our planned substantive procedures and the

extent of our control reliance.

– For the recoverable amounts of the IFCN CGU, whether and where the Group’s estimate lay within

our reasonable range.

– The adequacy of the disclosures, particularly as they relate to the sensitivity of the recoverable

amount of the IFCN CGU to key assumptions including net revenue growth, margin growth,

discount rate and terminal growth rate.

Areas of particular auditor judgement

We identified an area of particular auditor judgement to be the assessment of whether the Directors’

overall estimate of the recoverable amount of the IFCN CGU, considering key assumptions including

net revenue, gross margin, discount rate and terminal growth rate, fell within our acceptable range.

We also identified an area of particular auditor judgement to be the assessment of the Directors’

conclusion regarding the post balance sheet adverse verdict in the first NEC case’s effect on the

recoverable amount of the IFCN CGU and whether that continued to fall within our acceptable range.

Our results

We found the goodwill and indefinite life intangible asset balances relating to the IFCN CGU and the

related impairment charge to be acceptable (FY22 result: the Group’s conclusion that there is no

impairment of the goodwill and intangible assets relating to the IFCN CGU to be acceptable).

Further information in the Annual Report and Accounts: See the Audit Committee Report on page 92 for

details on how the Audit Committee considered recoverability of goodwill and indefinite life intangible

assets relating to the IFCN CGU as an area of significant attention, page 167 for the accounting policy on

recoverability of goodwill and indefinite life intangible assets and note 9 for the financial disclosures.

5.2 Recoverability of Biofreeze CGU goodwill and indefinite life intangible assets

Financial Statement Elements

FY23 FY22

Goodwill and indefinite life intangible assets (Biofreeze) £613m £807m

Impairment charge (Biofreeze) £0m £152m

Independent Auditor’s Report continued

5. Key audit matters continued

144 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Our assessment of risk vs FY22

Vs FY22

In FY22 no headroom existed between the recoverable amount and the net book value of

the Biofreeze CGU following an impairment recognised as a result of category slowdown in

an unfavourable macroeconomic environment. Our assessment is that the risk is similar in

FY23 in relation to the impairment test carried out on 30 September 2023.

Our results

FY23: Acceptable

FY22: Acceptable

Description of the Key Audit Matter

The risk: forecast-based impairment assessment

The recoverability of goodwill and indefinite life intangible assets relating to the Biofreeze cash

generating unit (“CGU”) is assessed using value in use which is based on forecast financial information

within a discounted cash flow model (“the Biofreeze Model”).

In FY22 the Group recognised an impairment charge of £152m, that reflected underperformance driven

by category slowdown in an unfavourable macroeconomic environment. Following this impairment, no

headroom existed between the recoverable amount and net book value.

Key assumptions in the Biofreeze Model include the discount rate, forecast financial performance, in

particular net revenue and margin growth, and external factors impacting forecast category growth and

terminal growth rates.

On 30 September 2023, in light of changes in level at which goodwill associated with Biofreeze was

monitored, the Group reallocated the goodwill into the Health group of cash generating units (GCGU).

Due to limited headroom, an impairment assessment of the Biofreeze CGU inclusive of goodwill was

carried out immediately ahead of the goodwill reallocation.

The effect of these matters is that, as part of our risk assessment, we determined that the recoverable

amount of the Biofreeze CGU at 30 September 2023 has a high degree of estimation uncertainty with a

potential range of reasonable outcomes greater than our materiality for the financial statements as a

whole, and possibly many times that amount.

We also identified a fraud risk related to the estimation of the recoverable amount of goodwill and

intangible assets relating to the Biofreeze CGU in response to possible pressures on the Group to realise

value from significant acquisitions.

Our response to the risk

Our procedures to address the risk included:

Sensitivity analysis: We considered the sensitivity of the recoverable amount of the goodwill and

indefinite life intangible assets relating to the Biofreeze CGU to reasonably possible changes in

assumptions and focused our attention on those assumptions which we considered the most critical to

the recoverable amount of the Biofreeze CGU.

Benchmarking assumptions: In response to the risk of fraud, we evaluated the net revenue growth

assumptions in the Biofreeze model with reference to historic performance and external market data

relating to projected growth for the relevant categories.

We critically challenged the Group’s assumptions relating to price and volume growth through

comparison to external market data sources and evaluated the Group’s assumptions for achieving

growth through planned innovation and international growth by assessing against historic performance

and comparison to external data sources.

We benchmarked margin and other costs assumptions against historical trends, and our assessment of

the Group’s historic ability to achieve productivity savings. We also benchmarked the terminal growth

rate assumption against market inflation forecast.

Personnel interviews: We compared judgements made centrally to discussions we held directly with the

relevant members of global business units and country management. We considered and challenged the

Group’s assumptions and corroborated these views with the Groups’ in-market teams.

Valuation expertise: Using our own valuation specialists, we challenged key assumptions including the

discount rate and terminal growth rate used in the Biofreeze Model. We assessed whether the premium

applied to the discount rate was appropriate considering the operational integration of Biofreeze

processes into the wider Health business unit. We also benchmarked the recoverable amount of the

Biofreeze CGU using implied earnings multiples with comparable companies, historic transactions within

the industry, and to Biofreeze’s acquisition multiple, as well as considering latest market conditions.

Assessing transparency: We assessed whether the Group’s disclosures in note 9 of the sensitivity of the

outcome of the impairment assessment to changes in key assumptions reflected the risks inherent in the

recoverable amount of goodwill and indefinite life intangible assets relating to the Biofreeze CGU at

30 September 2023. In particular we assessed whether appropriate disclosures were provided to explain

the circumstances leading to reallocation of goodwill and the results of impairment assessment

performed ahead of this reallocation.

We performed the tests above rather than seeking to rely on any of the Group’s controls because the

nature of the balance is such that we would expect to obtain audit evidence primarily through the

detailed procedures described.

Independent Auditor’s Report continued

5. Key audit matters continued

145 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Communications with the Reckitt Benckiser Group plc’s Audit Committee

Our discussions with and reporting to the Audit Committee included:

– Our approach to impairment assessment of goodwill and indefinite life intangible assets relating to

the Biofreeze CGU, including details of our planned substantive procedures and the extent of our

control reliance.

– For the recoverable amounts of the Biofreeze CGUs, whether and where the Group’s estimate lay

within our reasonable range.

– The adequacy of the disclosures, particularly as they relate to the sensitivity of the recoverable

amounts of the Biofreeze CGU to key assumptions including net revenue growth, margin growth,

discount rate and terminal growth rate.

Areas of particular auditor judgement

We identified an area of particular auditor judgement to be the assessment of whether the Directors’

overall estimate of the recoverable amounts of the Biofreeze CGU, considering key assumptions

including net revenue, gross margin, discount rate and terminal growth rate, fell within our

acceptable range.

Our results

We found the Group’s conclusion ahead of reallocation of goodwill to Health GCGU that there is no

impairment of goodwill and indefinite life intangible assets relating to the Biofreeze CGU to be

acceptable; (FY22 result for the Biofreeze CGU we found the goodwill and indefinite life intangible

assets balance, and the related impairment charge, to be acceptable.

Further information in the Annual Report and Accounts: See the Audit Committee Report on page 92 for

details on how the Audit Committee considered recoverability of goodwill and indefinite life intangible

assets relating to the Biofreeze CGU as an area of significant attention, page 167 for the accounting

policy on recoverability of goodwill and indefinite life intangible assets and note 9 for the financial

disclosures.

5.3 Revenue recognition in relation to trade spend arrangements and associated accruals (Group)

Financial Statement Elements

FY23 FY22

Trade spend accruals £1,125m £1,137m

Our assessment of risk vs FY22

Vs FY22

We have not identified any significant changes to our assessment of the level of risk

relating to trade spend arrangements and related accruals compared to FY22.

Our results

FY23: Acceptable

FY22: Acceptable

Description of the Key Audit Matter

The risk: subjective estimate

The Group regularly enters into complex arrangements providing pricing, placement and other

promotional rebates and allowances to its customers. These trade spend arrangements can vary in

complexity by market, product category and customer.

Revenue is measured net of outflows arising from such arrangements which, for agreements or practices

spanning a period end, requires an estimate of the extent and value of future activity. These estimates

can be subjective and require the use of assumptions that are susceptible to management bias and fraud.

The Group operates a variable compensation scheme with outturns directly linked to financial

performance against targets. Strong financial performance could create an incentive to defer revenues

into the next financial year by overstating trade spend accruals. Weaker financial performance may also

create an incentive to understate trade spend accruals. Whilst the risk of a material misstatement in an

individual market is remote, there is a risk that inappropriate judgements in multiple markets may, in

aggregate, materially misstate the Group’s financial statements.

The effect of these matters is that, as part of our risk assessment, we determined that trade spend

accruals carry a high degree of estimation uncertainty, with a potential range of reasonable outcomes

greater than our materiality for the Group’s financial statements as a whole.

Our response to the risk

Our procedures to address the risk included:

Accounting policies: We critically assessed the appropriateness of the Group’s accounting policies

relating to trade spend against requirements of IFRS 15 Revenue from Contracts with Customers.

Historical comparisons: For a selection of the more judgemental accruals, our component teams

assessed the historical accuracy of the accruals by:

– comparing those recognised in the prior year to the actual trade spend subsequently incurred; and

– where there were significant differences, considering whether such differences related to a change in

estimate or an error to respond to the risk of fraud and error, and evaluating whether any

overstatement or understatement identified was material.

Tests of detail: Testing was focused on those trade spend accruals we considered to be more

judgemental, or potentially subject to management bias or fraud. We performed procedures to a

precision level sufficient to address the risk of fraud. For a sample of these trade spend accruals, our

component teams:

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– reperformed the calculation to assess whether it was mathematically accurate;

– identified the key assumptions in the calculation of each accrual selected, such as forecast sales

volumes, rebate structure and settlement mechanism;

– agreed those key assumptions to relevant documentation, such as invoices received after the balance

sheet date, customer agreements or third-party consumption data; and

– assessed whether the key assumptions were consistent with external data points and the Group’s

historic experience of comparable trade spend arrangements.

Expectation vs outcome: We performed analytical procedures over the aggregated balance at a group

level, and our component teams completed disaggregated analytical procedures over the individual

balances.

Assessing transparency: We assessed the adequacy of the Group’s disclosures in note 1 in relation to the

degree of estimation in the trade spend accruals and the resulting amount of trade spend deducted

from Net Revenue.

We performed the detailed tests above rather than seeking to rely on any of the Group’s controls

because our knowledge of the design of these controls and related IT controls indicated that we would

not be able to obtain the required evidence to support reliance on controls.

Communications with the Reckitt Benckiser Group plc’s Audit Committee

Our discussions with and reporting to the Audit Committee included:

– Our approach to the audit of the trade spend accruals including details of our planned substantive

procedures and the extent of our control reliance.

– As described in section 6, our response to the additional specific fraud risk identified relating to

the investigation commissioned by the Directors in two Middle Eastern markets that identified an

understatement of trade spend accruals and our related findings.

– Our assessment of findings from our component team’s procedures, including the historical

comparisons of FY22 accruals and whether those indicated material errors, and whether the FY23

accruals in relation to trade spend were acceptable.

Areas of particular auditor judgement

We performed an assessment of whether the Group`s overall estimate, considering the Group’s

accounting policies, and the complex nature of the agreements entered into, is acceptable. We also

considered whether an unadjusted overstatement identified through our procedures directly related

to the key audit matter was material.

Our results

We found the trade spend accruals recognised to be acceptable (FY22 result: acceptable).

Further information in the Annual Report and Accounts: See the Audit Committee Report on page 88 for

details on how the Audit Committee considered revenue recognition in relation to trade spend

arrangements and associated accruals as an area of significant attention, page 168 for the accounting

policy on revenue recognition in relation to trade spend arrangements and associated accruals, and

note1 for the financial disclosures.

5.4 Contingent liabilities arising from the US litigation concerning Necrotising Enterocolitis (NEC) and the

amendment to the South Korean Humidifier Sanitiser (HS) law (Group)

Financial Statement Elements

Financial statements disclosure in note 20 and note 33

Our assessment of risk vs FY22

Vs FY22

We have assessed that the risk relating to contingent liabilities has increased from FY22

following an adverse verdict in the first NEC case. This increases the probability of

outflow of economic benefit and increases the level of judgement involved in the ability

to reliably estimate any such outflow.

We have not identified any significant change to the level of risk relating to contingent

liabilities arising from the amendment to the South Korean Humidifier Sanitiser (HS) Law

compared to FY22

Our results

FY23: Acceptable

FY22: Acceptable

Description of the Key Audit Matter

The risk: dispute outcome

The Group is named in a number of litigations relating to NEC in the United States and HS issues in South

Korea.

The South Korean HS law amendment enacted on 25 September 2020 significantly altered the legal

framework under which HS claims were previously made and settled. As a result, judgement is needed to

assess whether the recognition criteria for a provision have been met for additional litigation under the

HS law amendment.

An adverse verdict in the first NEC case on 13 March 2024 increases the probability of economic outflow

and increases the level of judgement involved in the ability to reliably estimate any such outflow in

relation to the NEC product liability actions in the United States.

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The amounts involved in these litigations are potentially significant, and the application of accounting

standards to determine the amount, if any, to be provided for, is inherently subjective. Given the

uncertainty relating to the likelihood, amount and timing of any possible economic outflow, there is a risk

over the classification of any liability as a provision or a contingent liability and the transparency of

disclosures therein.

Our response to the risk

Our procedures to address the risk included:

Inquiry of lawyers: We inquired of the Group’s internal and external counsel to obtain an understanding

of developments. In relation to the HS matter we inquired into the progress of litigation and the

establishment of a mediation panel between HS companies and claimant groups. In relation to the NEC

litigation we inquired as to the progress through discovery and the likely prospects of successfully

defending the cases based on available evidence, including scientific evidence, and therefore the ability

to reliably estimate any economic outflow. We requested and received formal correspondence directly

from the Group’s external counsel for both the HS matter and NEC litigations that evaluated the current

status of legal proceedings.

We corroborated the consistency of the judgement made by the Directors to inquiries with both internal

and external legal counsel.

Assessing transparency: We assessed the adequacy of the Group’s disclosures of contingent liabilities

related to the NEC litigations and the HS matter in note 20, particularly the uncertainties relating to the

amount and timing of any resulting outflow.

We performed the tests above rather than seeking to rely on any of the Group’s controls because the

nature of the balance is such that we would expect to obtain audit evidence primarily through the

detailed procedures described.

Communications with the Reckitt Benckiser Group plc’s Audit Committee

Our discussions with and reporting to the Audit Committee included:

– Our approach to the assessment over the ongoing litigation relating to NEC in the United States

and the HS issue in South Korea.

– Our conclusions on the appropriateness of the Group’s methodology and accounting policies.

– The adequacy of the disclosures, particularly as it relates to the uncertainties in relation to the

amount and timing of any resulting outflow.

Areas of particular auditor judgement

We identified an area of particular auditor judgement to be consideration of whether the contingent

liability disclosure is sufficiently transparent in respect of the uncertainties that exist in relation to the

amount and timing of any resulting outflow.

Our results

We found the Group’s assessment that the impact of the HS law amendment as contingent liabilities

and transparency of disclosure to be acceptable (FY22 result: acceptable).

We found the Group’s assessment that the potential outflows from the NEC litigations are

treatedasa contingent liability and the transparency of the related disclosure to be acceptable

(FY22result:acceptable).

Further information in the Annual Report and Accounts: See the Audit Committee Report on page 88 for

details on how the Audit Committee considered contingent liabilities arising from the amendment to the

South Korean HS law and NEC litigation in the United States as areas of significant attention, page 168 for

the accounting policy on contingent liabilities arising from the amendment to the South Korean HS law,

and note 20 for the financial disclosures.

5.5 Accounting for the forward purchase of shares held by the non-controlling interest of

“RBManon”(Group)

Financial Statement Elements

FY23 FY22

Trade and other payables £158m n/a

Forward purchase of shares held by NCI (within Total Equity) £167m n/a

Our assessment of risk vs FY22

Vs FY22

On 25 May 2023 the Group entered into a new agreement outlined below, and therefore

this is a new risk for FY23.

New

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148 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

Our results

FY23: Acceptable

FY22: n/a

Description of the Key Audit Matter

The risk: accounting treatment

The Group has entered into an agreement to acquire the remaining interests in the Group’s majority

owned entities in mainland China and Hong Kong (“RB Manon”) from its existing minority shareholders.

The estimated present value of the total amounts payable under the agreement is £298 million and is not

a key source of estimation uncertainty. However, the agreement has two components – purchase of the

non-controlling interest which is taken to equity, and services provided by the minority shareholders

which are charged to the income statement over the service period.

Significant judgement is required to allocate the total amount payable between equity and the income

statement in future periods.

We also identified a fraud risk in response to possible pressures to reduce future income statement

expenses.

Our response to the risk

Our procedures to address the risk included:

Accounting analysis: We interpreted the relevant standards and best application in relation to the terms

of the deal in order to assess the Group’s valuation of the component parts.

Valuation expertise: Using our own valuation specialists, we challenged the value of the non-controlling

interest in the RB Manon business determined by the valuation specialists engaged by the Group. Our

valuations specialists have also reviewed and challenged specialists engaged by the Group on their

valuation methodologies and approaches to calculate the fair value and key assumptions such as WACC,

marketability considerations and any minority / controls considerations.

Benchmarking assumptions: We performed benchmarking to previous transactions with the parties

involved in RB Manon.

Assessing transparency: We assessed the adequacy of the Group’s disclosures in explaining the various

component parts of the deal, the accounting judgements made and how the values of the components

were calculated.

We performed the tests above rather than seeking to rely on any of the Group’s controls because the

nature of the balance is such that we would expect to obtain audit evidence primarily through the

detailed procedures described.

Communications with the Reckitt Benckiser Group plc’s Audit Committee

Our discussions with and reporting to the Audit Committee included:

– Our approach to the audit of the accounting treatment for the transaction, including details of our

planned substantive procedures and the extent of our control reliance.

– Our approach to the audit of the accounting judgement relating to the allocation of the amount

payable in relation to the two components of the transaction.

– The adequacy of the disclosures,

Areas of particular auditor judgement

We identified an area of particular auditor judgement to be the assessment of whether the Directors’

overall accounting judgement of the allocation of the total consideration to the deal components

(i.e. payment for transitional services or equity) is acceptable.

Our results

We found the Group’s accounting treatment to be acceptable (FY22 result: not applicable, as this was

not a key audit matter in FY22).

Further information in the Annual Report and Accounts: See the Audit Committee Report on page 88 for

details on how the Audit Committee considered accounting for the share purchase agreement for the

non-controlling interest of RB Manon as an area of significant attention, page 167 for the accounting

policy on the relevant treatment and note 30 for the financial disclosures.

5.6 Provisions for uncertain tax positions (Group)

Financial Statement Elements

FY23 FY22

Uncertain tax positions £619m £722m

Our assessment of risk vs FY22

Vs FY22

We have not identified any significant changes to our assessment of the level of risk

relating to provisions for uncertain tax positions compared to FY22.

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Our results

FY23: Acceptable

FY22: Acceptable

Description of the Key Audit Matter

The risk: subjective estimate

Due to the Group operating across a number of different tax jurisdictions, and the complexities of

transfer pricing and other international tax legislation, it is subject to periodic challenge by local tax

authorities on a range of tax matters arising in the normal course of business.

These challenges by the local tax authorities include but are not limited to:

– transfer pricing arrangements relating to the Group’s operating model;

– transfer pricing arrangements relating to the ownership of intellectual property rights that are used

across the Group;

– deductibility of interest on intra-group borrowings; and

– the European Commission’s ongoing State Aid investigations into transfer pricing ruling practices of

certain member states.

Provisions for uncertain tax positions require judgements and estimates to be made in relation to tax issues

and exposures where the Group may be challenged by local tax authorities on its interpretation of tax

legislation. Auditor judgement is required to assess whether the Directors’ overall estimate falls within an

acceptable range. This takes into account the method and assumptions underpinning exposures calculated

such as: the clarity of relevant legislation and related guidance; advice from in-house specialists; opinions

of professional firms; past experience; and precedents set by a particular tax authority.

The effect of these matters is that, as part of our risk assessment, we determined that the estimates of

uncertain tax positions have a high degree of estimation uncertainty, with a potential range of reasonable

outcomes greater than our materiality for the Group`s financial statements as a whole and possibly many

times that amount.

Our response to the risk

Our procedures to address the risk included:

Our tax expertise: We used our own international and local tax specialists to assist us to:

– Inspect and assess the Group’s centrally prepared transfer pricing policies to determine whether they

reflect the risks, activities and substance of each of the entities within the supply chain; and

– Assess the Group’s tax positions, its correspondence with the relevant tax authorities, and to analyse

and challenge the assumptions used to determine provisions for tax uncertainties based on our

knowledge and experiences of the application of tax legislation.

Historical comparisons: We assessed the historical accuracy of the provisions, with reference to any

recent tax authority audits and related results, and we considered the impact on the remaining provision.

Assessing transparency: We assessed the adequacy of the Group’s disclosures in notes 1 and 22 in

respect of uncertain tax positions.

We performed the tests above rather than seeking to rely on any of the Group’s controls because the

nature of the balance is such that we would expect to obtain audit evidence primarily through the

detailed procedures described.

Communications with the Reckitt Benckiser Group plc’s Audit Committee

Our discussions with and reporting to the Audit Committee included:

– Our approach to the audit of the provisions for uncertain tax positions, including details of our

planned substantive procedures and the extent of our control reliance.

– For the provisions for uncertain tax positions, whether and where the Group’s estimate lay within

our reasonable range.

– The adequacy of the disclosures, particularly as it relates to the sensitivity of the uncertain tax

position to possible changes in key assumptions.

Areas of particular auditor judgement

We identified an area of particular auditor judgement to be the clarity of the associated disclosure in

relation to the estimation uncertainty associated with uncertain tax positions.

Our results

We found the level of the uncertain tax provisioning to be acceptable (FY22 result: acceptable).

Further information in the Annual Report and Accounts: See the Audit Committee Report on page 88 for

details on how the Audit Committee considered provisions for uncertain tax positions as an area of

significant attention, page 167 for the accounting policy on uncertain tax positions and note 22 for the

financial disclosures.

5.7 Recoverability of the Parent Company’s investment in the subsidiary, reckitt benckiser limited (Parent

Company)

Financial Statement Elements

FY23 FY22

Parent company investment £15,174m £15,078m

Our assessment of risk vs FY22

Vs FY22

We have not identified any significant changes to our assessment of the level of risk

relating to the recoverability of the Parent Company’s investment in the subsidiary,

Reckitt Benckiser Limited, compared to FY22.

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Our results

FY23: Acceptable

FY22: Acceptable

Description of the Key Audit Matter

The risk: low risk, high value

The carrying amount of the Parent Company’s investment in its subsidiary, Reckitt Benckiser Limited,

represents 98.7% (FY22: 99.6%) of the Parent Company’s total assets. Its recoverability is not at a high risk

of significant misstatement or subject to significant judgement. However, due to its materiality in the

context of the Parent Company`s financial statements, this is considered to be the area that had the

greatest effect on our overall Parent Company audit.

Our response to the risk

Our procedures to address the risk included:

Comparing valuations: We compared the carrying amount of the investment to the market capitalisation

of the Group as Reckitt Benckiser Limited, either directly or indirectly, owns all other subsidiaries of the

Group.

We performed the test above rather than seeking to rely on any of the Group’s controls because the

nature of the balance is such that we would expect to obtain audit evidence primarily through the

detailed procedure described.

Communications with the Reckitt Benckiser Group plc’s Audit Committee

Our discussions with and reporting to the Audit Committee included:

– Our approach to the assessment of the carrying amount of the Parent Company’s investment in

the subsidiary, including details of our planned substantive procedures and the extent of our

control reliance.

– For the carrying amount, our assessment of whether the conclusion that there is no impairment of

the Parent Company’s investment in the subsidiary is acceptable.

Our results

We found the Group’s conclusion that there is no impairment of its investment in the subsidiary to be

acceptable (FY22: acceptable).

Further information in the Annual Report and Accounts: See the Audit Committee Report on page 88 for

details on how the Audit Committee considered recoverability of the Parent Company’s investment in

the subsidiary, Reckitt Benckiser Limited as an area of significant attention, page 204 for the accounting

policy on recoverability of the Parent Company’s investment in the subsidiary, Reckitt Benckiser Limited,

and note 2 of Parent Company accounts for the financial disclosures.

6. Our ability to detect irregularities, and our response

Fraud – Identifying and responding to risks of material misstatement due to fraud

Fraud risk assessment

To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions

that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud.

Our risk assessment procedures included:

– Consultation with our own forensic specialists to assist us in identifying fraud risks based on their

experience of comparable businesses, similar sector, as well as of the geographies in which the Group

operates. The forensic specialists participated in the initial fraud risk assessment discussions and were

consulted throughout the audit when further guidance was deemed necessary;

– Enquiry of the Directors, operational managers, the General Counsel, the Chief Ethics and Compliance

Officer and members of the internal audit function to assess whether they have knowledge of any

actual, suspected or alleged fraud, as well as inspection of minutes of meetings of the Board, Audit

Committee, Executive Committee, Corporate Responsibility, Sustainability, Ethics and Compliance

(CRSEC) Committee, and Annual General Meeting;

– Inspection of the Group’s policies and procedures to prevent, detect and respond to the risks of fraud,

internal audit reports issued during the year and reports to the Group’s whistleblowing hotline and the

responses to those reports, including those concerning investigations;

– Consideration of the Group’s results against performance targets and the Group’s remuneration policies.

Risk communications

We communicated identified fraud risks throughout the audit team and remained alert to any indications

of fraud throughout the audit. This included communication from the group to component audit teams of

relevant fraud risks identified at the group level and request to all component audit teams to report to the

group audit team any instances of fraud that could give rise to a material misstatement at the Group level.

Fraud risks

We assessed that there is an inherent risk that group and component management could make

inappropriate accounting entries or have bias when making accounting estimates and judgements.

Wedetermined that these risks would most likely manifest themselves in three key areas being:

– Trade spend and other associated accruals may be manipulated to alter the timing of recognition of

revenue and profit particularly in light of the investigation commissioned by the Directors in two

Middle Eastern markets that identified an understatement of trade spend accruals;

– Management bias in the estimation of the recoverable amount of the IFCN and Biofreeze CGUs in

response to possible pressures to realise value from significant acquisitions;

– Management bias when applying judgement in relation to accounting treatment of the purchase of the

non-controlling interest in RB Manon, where there may be bias in respect of the allocation of the total

amount payable between equity and transition services to minimise future income statement impact.

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As required by auditing standards, and after considering the impact of the Group’s results against

performance targets, we performed procedures to address the risk of management override of controls,

the risk of fraudulent revenue recognition, and the risk of management bias associated with estimation

of the recoverable amounts of the IFCN and Biofreeze CGUs and the accounting treatment of RB Manon

transaction.

Link to KAMs

Further detail in respect of the fraud risks is set out in the key audit matter disclosures 5.1, 5.2, 5.3 and 5.4

in section 5 of this report.

Procedures to address fraud risks

We also performed procedures including:

– For all components within scope, identifying journal entries to test based on risk criteria and comparing

the identified entries to supporting documentation. These included unusual journal entries associated

with trade spend and other operational expenditure accruals.

– For all components within scope, additional procedures to incorporate an element of unpredictability,

in relation to trade spend and other associated accruals.

As a result of the investigation commissioned by the Directors in two Middle Eastern markets that

identified an understatement of trade spend accruals (and explained by the Directors on page 93, we

considered the implications for our audit. To address the additional specific fraud risk identified in a small

number of components we:

– Reduced materiality in the two impacted full scope components’ audits by 50% and performance

materiality from 75% to 50%.

– Performed incremental procedures over net revenue in the impacted components and three other full

scope components across the Group, to address the possible risk of contagion.

– Identified a further Middle Eastern component that was not previously in scope for the group audit and

carried out specified procedures over net revenue in that component.

Actual or suspected fraud discussed with the Audit Committee

We discussed with the Audit Committee matters relating to actual or suspected fraud, which included

the results of the investigation commissioned by the Directors in two Middle Eastern markets that

identified an understatement of trade spend accruals (as explained by the Directors on page 93 and the

results of our related procedures.

Laws and regulations – Identifying and responding to risks of material misstatement relating to

compliance with laws and regulations

Laws and regulations risk assessment

We identified areas of laws and regulations that could reasonably be expected to have a material effect

on the financial statements from our general commercial and sector experience. We held enquiries with

the Directors and other management (as required by auditing standards) and inspected regulatory and

legal correspondence received by the Group. We held enquiries with the Group’s external legal counsel

where considered necessary, and we also inspected the policies and procedures regarding compliance

with laws and regulations.

As the Group is regulated, our assessment of risks involved gaining an understanding of the control

environment including the entity’s procedures for complying with regulatory requirements.

Risk communications

We communicated identified laws and regulations throughout our team and remained alert to any

indications of non-compliance throughout the audit. This included communication from the group to all

component audit teams of relevant laws and regulations identified at the group level, and a request for

component auditors to report to the Group audit team any instances of non-compliance with laws and

regulations that could give rise to a material misstatement at the group level.

Direct laws context and link to audit

The potential effect of these laws and regulations on the financial statements varies considerably. The

Group is subject to laws and regulations that directly impact the financial statements including financial

reporting legislation (including related companies’ legislation), distributable profits legislation, and

taxation legislation (direct and indirect). We assessed the extent of compliance with these laws and

regulations as part of our procedures on the related financial statements items.

Most significant indirect law/regulation areas

The Group is subject to many other laws and regulations where the consequences of non-compliance

could have a material effect on amounts or disclosures in the financial statements, for instance through

the imposition of fines or litigation or the loss of the Group’s permission to operate in countries where

the non-adherence to laws could prevent trading in such countries.

We identified the following areas as those most likely to have such an effect:

– Employee health and safety, reflecting the nature of the Group’s production and distribution process;

– Anti-bribery and corruption, reflecting that the Group operates in a number of countries where there is

an opportunity to engage in bribery given more limited regulation;

– Interaction with healthcare professionals, reflecting the nature of the Group’s products in the Health

and Nutrition Global Business Units;

– Global competition laws, reflecting the nature of the Group’s business and certain market share

positions;

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152 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

– Consumer product law such as product safety, quality standards and product claims, reflecting the

nature of the Group’s diverse product base;

– Data privacy laws, reflecting the Group’s growing amounts of personal data held;

– Intellectual property legislation, reflecting the potential of the Group to infringe trademarks, copyright

and patents; and

– Environmental regulation, reflecting the nature of the Group’s production and distribution process.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and

regulations to enquiry of the Directors and other management and inspection of regulatory and legal

correspondence, if any. Therefore if a breach of operational regulations is not disclosed to us or evident

from relevant correspondence, an audit will not detect that breach.

Link to KAMs

Further detail in respect of the effect of ongoing litigations relating to NEC in the United States and the

HS Law Amendment in South Korea is set out in the key audit matter disclosures 5.4 in section 5 of this

report.

Context

Context of the ability of the audit to detect fraud or breaches of law or regulation

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected

some material misstatements in the financial statements, even though we have properly planned and

performed our audit in accordance with auditing standards. For example, the further removed non-

compliance with laws and regulations is from the events and transactions reflected in the financial

statements, the less likely the inherently limited procedures required by auditing standards would

identify it. In addition, as with any audit, there remained a higher risk of non-detection of fraud, as fraud

may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal

controls. Our audit procedures are designed to detect material misstatement. We are not responsible for

preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws

and regulations.

7. Our determination of materiality

The scope of our audit was influenced by our application of materiality. We set quantitative thresholds

and overlay qualitative considerations to help us determine the scope of our audit and the nature, timing

and extent of our procedures, and in evaluating the effect of misstatements, both individually and in the

aggregate, on the financial statements as a whole.

£140m

(FY22: £130m)

Materiality for the Group`s financial statements as a whole

What we mean

A quantitative reference for the purpose of planning and performing our audit.

Basis for determining materiality and judgements applied

Materiality for the Group`s financial statements as a whole was set at £140m (FY22: £130m). This was

determined with reference to a benchmark of normalised profit before tax from continuing operations

(“PBTCO”). When using a benchmark of normalised profit before tax to determine overall materiality, our

approach for listed entities considers a guideline range of 3% – 5% of the measure. In setting overall

group materiality, we applied a percentage of 4.5% (FY22: 4.1%) to the benchmark.

Consistent with FY22, we determined that normalised PBTCO remains the most appropriate benchmark

for the Group. Reckitt Benckiser Group plc is well established and operates in a stable environment

across multiple geographies. Therefore, users of the financial statements will be primarily interested in

the profitability of the Group and its ability to generate a return for shareholders, of which the most

relevant benchmark is normalised PBTCO.

We normalised PBTCO (FY22: normalised PBTCO) by adding back adjustments that do not represent the

normal, continuing operations of the Group. The items we adjusted for were impairment of goodwill and

other adjusting items as disclosed on page 226 in the table reconciling the Group’s IFRS measures to its

adjusted measures for the year ended 31 December 2023, totalling £695 million net (FY22: £90 million,

adjustments related to the impairment of goodwill, and other adjusting items as disclosed on pages 226.

Materiality for the Parent Company`s financial statements as a whole was set at £70m (FY22: £65m),

determined with reference to a benchmark of Parent Company total assets of which it represents 0.46%

(FY22: 0.45%). The Parent Company’s principal activity is holding the investment in Reckitt Benckiser Limited,

and therefore the total assets are the most relevant benchmark to the users of the financial statements.

£105m

(FY22: £85m)

Performance materiality

What we mean

Our procedures on individual account balances and disclosures were performed to a lower threshold,

performance materiality, so as to reduce to an acceptable level the risk that individually immaterial

misstatements in individual account balances add up to a material amount across the financial

statements as a whole.

Basis for determining performance materiality and judgements applied

We have considered performance materiality at a level of 75% (FY22: 65%) of materiality for Reckitt

Benckiser Group`s financial statements as a whole to be appropriate.

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153 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

The Parent Company performance materiality was set at £52m (FY22: £49m), which equates to 75%

(FY22:75%) of materiality for the Parent Company`s financial statements as a whole.

Performance materiality was set at 75% of components` materiality for all full scope components, with

the exception of two Middle East components where the performance materiality was set at 50% of

materiality (as described in section 6).

We applied this percentage in our determination of performance materiality because we did not

identifyany factors indicating an elevated level of risk. In FY22, we applied a lower percentage in our

determination of group performance materiality based on the level of identified misstatements and

control deficiencies during the prior period.

£6m

(FY22: £5m)

Audit misstatement posting threshold

What we mean

This is the amount below which identified misstatements are considered to be clearly trivial from a

quantitative point of view. We may become aware of misstatements below this threshold which could

alter the nature, timing and scope of our audit procedures, for example if we identify smaller

misstatements which are indicators of fraud.

This is also the amount above which all misstatements identified are communicated to Reckitt Benckiser

Group plc’s Audit Committee.

Basis for determining the audit misstatement posting threshold and judgements applied

We set our audit misstatement posting threshold at 4.3% (FY22: 3.9%) of our materiality for the Group`s

financial statements. We also report to the Audit Committee any other identified misstatements that

warrant reporting on qualitative grounds.

The overall materiality for the Group`s financial statements of £140m (FY22: £130m) compares as follows

to the main financial statement caption amounts:

Net revenue Profit before tax Total assets

FY23 FY22 FY23 FY22 FY23 FY22

Financial statement Caption £14,607m £14,453m £2,401m £3,067m £27,136m £28,742m

Group Materiality as %

ofcaption 1.0% 0.9% 6.2% 4.2% 0.5% 0.5%

8. The scope of our audit

Group scope

What we mean

How the group audit team determined the procedures to be performed across the Group.

The Group has 380 (FY22: 406) reporting components. In order to determine the work performed at the

reporting component level, we identified those components which we considered to be of individual

financial significance and those remaining components on which we required procedures to be

performed to provide us with the evidence we required in order to conclude on the Group`s financial

statements as a whole.

We determined individually financially significant components as those contributing at least 10% (2022:

10%) of revenue or total assets. We selected revenue and total assets because these are the most

representative of the relative size of the components. We identified 1 (2022: 1) component as individually

financially significant component and performed a full scope audit on this component.

In addition, to enable us to obtain sufficient appropriate audit evidence for the Group`s financial

statements as a whole, we selected 51 (2022: 52) components on which to perform full scope audits.

We subjected 2 (2022: 1) components to specified audit procedures. We carried out procedures over

expenses for one component that was not individually significant but was included in the scope of our

work on the Group’s financial statements in order to provide further coverage over the Group’s results.

Additionally, following the investigation in the Middle East described in section 6, we carried out specified

procedures over net revenue and trade receivables for a component that was not previously in scope.

The components within the scope of our work accounted for the following percentages of the Group’s

results, with the prior year comparatives indicated in brackets:

Scope

Number of

components Range of materiality

Percentage

of the

Group’s net

revenue

Percentage

of the

Group’s

profit

beforetax

Percentage

of he Group’s

total assets

Full Scope 52 (53) £8m to £75m (£8m to £75m) 80% (79%) 67% (68%) 86% (85%)

Specified procedures 2 (1) £40m to £65m (£64m) 1% (0%) 11% (9%) 1% (0%)

Total 54 (54) £8m to £75m (£8m to £75m) 81% (79%) 78% (77%) 87% (85%)

The remaining 19% (2022: 21%) of net revenue, 22% (2022: 23%) of total profits and losses that made up

profit before tax and 14% (2022: 15%) of total assets is represented by 326 (2022: 354) reporting

components, none of which individually represented more than 2% (2022: 2%) of any of total group

revenue, total profits and losses that made up group profit before tax or total group assets. For these

components, we performed analysis at an aggregated group level to re-examine our assessment that

there were no significant risks of material misstatement within these.

The work on 50 of the 54 components (2022: 51 of the 54 components) was performed by component

auditors and the rest, including the audit of the Parent Company, was performed by the group audit team.

The components within the scope of our work accounted for the percentages illustrated in section 2 –

Group Scope.

Independent Auditor’s Report continued

7. Our determination of materiality continued

154 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

The group audit team has also performed audit procedures on the following areas on behalf of the components:

– Testing of IT Systems

– Items excluded from normalised group PBTCO; and

– Testing of revenue recorded through a common service provider

IT systems and part of revenue are managed centrally, and items excluded from normalised group PBTCO

are adjusted at group level. Therefore, these items were audited by the group audit team. The group

audit team communicated the results of these procedures to the component teams where relevant.

The scope of the audit work performed was fully substantive as we did not rely upon the Group’s internal

control over financial reporting.

Group audit team oversight

What we mean

The extent of the group audit team’s involvement in component audits.

The group audit team is required to instruct the component teams about their responsibilities in relation to

the consolidated group audit and to understand the approach taken by component auditors to meet these

responsibilities. The group audit team is also required to understand the conclusions reached by component

auditors and to review and challenge the work they have performed to reach these conclusions.

The group audit team physically visited 18 countries in November and December 2023 to attend

management balance sheet reviews ahead of the year end (2022: 19). The group team also attended four

meetings virtually. In addition, the group audit team held an Auditor’s Global Conference in London

attended by partners and managers for 50 in-scope components, where the use of Data and Analytics,

updates to group level significant risks, the Group’s internal controls transformation and FY23 audit

strategy were discussed:

We had regular contact with our component auditors throughout the year, including issuing instructions

to components auditors on the scope of their work, risk assessment and challenge meetings at planning

and final phases of the audit and inspection of component audit teams’ key working papers within the

component audit files.

Additionally, in relation to the fraud identified in the Middle East the group audit team worked closely

with and made requests of the Group’s Ethics and Compliance team and external legal counsel leading

the investigation, supported by our own forensics specialists. We subjected the two Middle East in-scope

components to additional procedures, which were directed and overseen by the group audit team

The group audit team, including the Group Engagement Partner, were in daily communication with the

Middle East components throughout the investigation and a supplemental physical visit to the region was

undertaken in March 2024 to perform further in-depth review of their audit files, along with further

discussions with the component teams and regional management.

9. Other information in the Annual Report

The Directors are responsible for the other information presented in the Annual Report together with the

financial statements. Our opinion on the financial statements does not cover the other information and,

accordingly, we do not express an audit opinion or, except as explicitly stated below, any form of

assurance conclusion thereon.

All other information

Our responsibility

Our responsibility is to read the other information and, in doing so, consider whether, based on our

financial statements audit work, the information therein is materially misstated or inconsistent with the

financial statements or our audit knowledge.

Our reporting

Based solely on that work we have not identified material misstatements or inconsistencies in the other

information.

Strategic Report and Directors’ Report

Our responsibility and reporting

Based solely on our work on the other information described above we report to you as follows:

– we have not identified material misstatements in the Strategic Report and the Directors’ Report;

– in our opinion the information given in those reports for the financial year is consistent with the

financial statements; and

– in our opinion those reports have been prepared in accordance with the Companies Act 2006.

Directors’ Remuneration Report

Our responsibility

We are required to form an opinion as to whether the part of the Directors’ Remuneration Report to be

audited has been properly prepared in accordance with the Companies Act 2006.

Our reporting

In our opinion the part of the Directors’ Remuneration Report to be audited has been properly prepared

in accordance with the Companies Act 2006.

Corporate governance disclosures

Our responsibility

We are required to perform procedures to identify whether there is a material inconsistency between

the financial statements and our audit knowledge, and:

– the Directors’ statement that they consider that the annual report and financial statements taken as a

whole is fair, balanced and understandable, and provides the information necessary for shareholders

to assess the Group’s position and performance, business model and strategy;

Independent Auditor’s Report continued

8. The scope of our audit continued

155 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT OTHER INFORMATION

– the section of the annual report describing the work of the Audit Committee, including the significant

issues that the Audit Committee considered in relation to the financial statements, and how these

issues were addressed; and

– the section of the annual report that describes the review of the effectiveness of the Group’s risk

management and internal control systems.

Our reporting

Based on those procedures, we have concluded that each of these disclosures is materially consistent

with the financial statements and our audit knowledge.

We are also required to review the part of the Corporate Governance Statement relating to the Group’s

compliance with the provisions of the UK Corporate Governance Code specified by the Listing Rules for

our review.

We have nothing to report in this respect.

Other matters on which we are required to report by exception

Our responsibility

Under the Companies Act 2006, we are required to report to you if, in our opinion:

– adequate accounting records have not been kept by the Parent Company, or returns adequate for our

audit have not been received from branches not visited by us; or

– the Parent Company’s financial statements and the part of the Directors’ Remuneration Report to be

audited are not in agreement with the accounting records and returns; or

– certain disclosures of Directors’ remuneration specified by law are not made; or

– we have not received all the information and explanations we require for our audit.

Our reporting

We have nothing to report in these respects.

10. Respective responsibilities

Directors’ responsibilities

As explained more fully in their statement set out on page 137, the Directors are responsible for: the

preparation of the financial statements including being satisfied that they give a true and fair view; such

internal control as they determine is necessary to enable the preparation of financial statements that are

free from material misstatement, whether due to fraud or error; assessing the Group and Parent

Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going

concern; and using the going concern basis of accounting unless they either intend to liquidate the Group

or the Parent Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are

free from material misstatement, whether due to fraud or error, and to issue our opinion in an auditor’s

report. Reasonable assurance is a high level of assurance, but does not guarantee that an audit

conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in aggregate,

they could reasonably be expected to influence the economic decisions of users taken on the basis of

the financial statements.

A fuller description of our responsibilities is provided on the FRC’s website at

www.frc.org.uk/auditorsresponsibilities.

The Company is required to include these financial statements in an annual financial report prepared

under Disclosure Guidance and Transparency Rule 4.1.17R and 4.1.18R. This auditor’s report provides no

assurance over whether the annual financial report has been prepared in accordance with those

requirements.

11. The purpose of our audit work and to whom we owe our responsibilities

This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16

of the Companies Act 2006 and the terms of our engagement by the Company. Our audit work has been

undertaken so that we might state to the Company’s members those matters we are required to state to

them in an auditor’s report, and the further matters we are required to state to them in accordance with

the terms agreed with the company, and for no other purpose. To the fullest extent permitted by law, we

do not accept or assume responsibility to anyone other than the Company and the Company’s members,

as a body, for our audit work, for this report, or for the opinions we have formed.

Andrew Bradshaw (Senior Statutory Auditor)

for and on behalf of KPMG LLP, Statutory Auditor

Chartered Accountants

15 Canada Square

London

21 March 2024

Independent Auditor’s Report continued

9. Other information in the Annual Report continued

156 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Note

		2023	2022
		£m	£m
CONTINUING OPERATIONS
Net Revenue	2	14 ,6 07	14 ,453
Cost of sales		(5,847)	(6,09 2)
Gross profit		8 , 76 0	8 , 3 61
Impairment of goodwill		(8 1 0)	(1 67)
Other operating expenses		(5, 41 9)	(4 ,9 4 5)
Net operating expenses	3	(6 , 2 2 9)	(5 ,1 1 2)
Operating profit	2	2, 531	3, 249
Finance income	6	210	130
Finance expense	6	(3 4 0)	(29 1)
Impairment of equity-accounted investments	11	–	(1 9)
Share of loss of equity-accounted investments, net of tax	11	–	(2)
Profit before income tax		2,401	3 , 0 67
Income tax charge	7	(75 3)	(711)
Net profit from continuing operations		1,648	2,35 6
Net profit/(loss) from discontinued operations	32	9	(7)
Net profit		1,657	2, 349
Attributable to non-controlling interests		14	19
Attributable to owners of the parent company		1,6 43	2, 330
Net profit		1,657	2, 349
Basic earnings/(loss) per ordinary share
From continuing operations (pence)	8	2 2 7. 9	3 2 6 .7
From discontinued operations (pence)	8	1.3	(1 .0)
From total operations (pence)	8	2 2 9. 2	32 5 .7
Diluted earnings/(loss) per ordinary share
From continuing operations (pence)	8	22 7. 4	32 5 .7
From discontinued operations (pence)	8	1.3	(1 .0)
From total operations (pence)	8	22 8 .7	3 2 4 .7

Note

		2023	2022
		£m	£m
Net profit		1,657	2, 349
Other comprehensive income/(expense)
Items that have or may be reclassified to the Income Statement in subsequent years
Net exchange (loss)/gain on foreign currency translation, net of tax	7, 26	(6 3 9)	1,065
Reclassification of foreign currency translation reserves on disposal or liquidation of foreign operations, net of tax	7, 26	(131)	(56)
Gains/(losses) on net investment hedges, net of tax	7, 26	42	(115)
Fair value (losses) on cash flow hedges, net of tax	7, 26	(1 6)	(32)
Reclassification of cash flow hedges to the income statement	7, 26	(2 3)	34
		(767)	896
Items that will not be reclassified to the Income Statement in subsequent years
Remeasurements of defined benefit pension plans, net of tax	7	(2 6)	24
Revaluation of equity instruments – FVOCI, net of tax	7	(1 0)	(87)
		(3 6)	(6 3)
Other comprehensive (expense)/income, net of tax		(8 03)	833
Total comprehensive income		854	3 ,1 8 2
Attributable to non-controlling interests		13	20
Attributable to owners of the parent company		8 41	3 ,1 6 2
Total comprehensive income		854	3 ,1 8 2
Total comprehensive income attributable to owners of the parent company arising from:
Continuing operations		832	3 ,1 6 9
Discontinued operations		9	(7)
		8 41	3 ,1 6 2

Group Income Statement

For the year ended 31 December 2023

Group Statement of Comprehensive Income

For the year ended 31 December 2023

157 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Note

		2023	2022
		£m	£m
ASSETS
Non-current assets
Goodwill and other intangible assets	9	1 8,588	20 ,203
Property, plant and equipment	10	2,399	2 , 47 3
Equity instruments	11	118	86
Deferred tax assets	12	2 87	24 4
Retirement benefit surplus	23	270	294
Other non-current receivables	14	172	1 57
Total non-current assets		21,834	23 , 457
Current assets
Inventories	13	1,637	1, 825
Trade and other receivables	14	2,062	2, 082
Derivative financial instruments	15, 17	64	59
Current tax recoverable		80	155
Cash and cash equivalents	16	1,3 87	1 ,1 5 7
Assets held for sale	31	72	7
Total current assets		5,3 02	5, 285
Total assets		2 7, 1 3 6	2 8 , 74 2
LIABILITIES
Current liabilities
Short-term borrowings	17	(1 , 67 9)	(1 ,7 2 1)
Provisions for liabilities and charges	18	(1 42)	(227)
Trade and other payables	21	(5 , 5 0 6)	(5 , 5 47)
Derivative financial instruments	15, 17	(78)	(55)
Share repurchase liability	24	(296)	–
Current tax liabilities	22	(6 2 0)	(79 1)
Liabilities held for sale	31	(17)	–
Total current liabilities		(8,338)	(8 , 3 41)
Non-current liabilities
Long-term borrowings	17	(6 , 8 5 8)	(7 , 163)
Deferred tax liabilities	12	(2 ,8 9 9)	(3, 037)
Retirement benefit obligations	23	(2 3 3)	(24 0)
Provisions for liabilities and charges	18	(57)	(59)
Derivative financial instruments	15, 17	(187)	(249)
Non-current tax liabilities	22	(28)	(5 4)
Other non-current liabilities	21	(67)	(116)
Total non-current liabilities		(1 0, 32 9)	(1 0 ,9 18)
Total liabilities		(1 8 , 6 67)	(1 9, 2 5 9)
Net assets		8,4 69	9 ,483

Note

		2023	2022
		£m	£m
EQUITY
Capital and reserves
Share capital	24	74	74
Share premium		254	254
Merger reserve		(1 4, 22 9)	(1 4, 2 29)
Other reserves	26	(1, 060)	(2 94)
Retained earnings		23,409	2 3,638
Attributable to owners of the parent company		8,448	9, 4 4 3
Attributable to non-controlling interests		21	40
Total equity		8,4 69	9 ,483

The accompanying notes form part of these Financial Statements. The Financial Statements on pages 156

to 200 were approved by the Board of Directors and signed on its behalf on 21 March 2024 by:

Christopher Sinclair Kris Licht

Director Director

Reckitt Benckiser Group plc Reckitt Benckiser Group plc

Group Balance Sheet

As at 31 December 2023

158 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Note

							Total
							attributable
							to owners of	Non-
		Share	Share	Merger	Other	Retained	the parent	controlling	Total
		capital	premium	reserves 1	reserves	earnings	company	interests	equity
		£m	£m	£m	£m	£m	£m	£m	£m
Balance at 1January2022		74	253	(1 4, 22 9)	(1 ,1 8 9)	22, 49 0	7, 3 9 9	54	7, 4 5 3
Comprehensive income
Net income		–	–	–	–	2, 330	2,330	19	2, 3 49
Other comprehensive income/(expense)		–	–	–	895	(6 3)	8 32	1	833
Total comprehensive income		–	–	–	8 95	2 , 2 67	3, 162	20	3 ,1 8 2
Transactions with owners
Treasury shares reissued	24	–	1	–	–	53	54	–	54
Issuance of shares to non-controlling interest		–	–	–	–	–	–	1	1
Share-based payments	25	–	–	–	–	78	78	–	78
Tax on share awards	7	–	–	–	–	(1)	(1)	–	(1)
Cash dividends	28	–	–	–	–	(1 , 249)	(1, 249)	(3 5)	(1 , 2 8 4)
Total transactions with owners		–	1	–	–	(1 ,1 1 9)	(1 ,1 1 8)	(3 4)	(1 ,1 5 2)
Balance at 31 December 2022		74	254	(1 4, 22 9)	(2 9 4)	23,638	9, 4 4 3	40	9 ,483
Comprehensive income
Net income		–	–	–	–	1,6 43	1,6 43	14	1 , 6 57
Other comprehensive expense		–	–	–	(76 6)	(3 6)	(80 2)	(1)	(80 3)
Total comprehensive (expense)/income		–	–	–	(76 6)	1, 607	8 41	13	854
Transactions with owners
Treasury shares reissued	24	–	–	–	–	48	48	–	48
Purchase of ordinary shares by employee share ownership trust		–	–	–	–	(2)	(2)	–	(2)
Repurchase of ordinary shares	24	–	–	–	–	(5 03)	(5 03)	–	(50 3)
Share-based payments	25	–	–	–	–	1 02	102	–	1 02
Tax on share awards	7	–	–	–	–	1	1	–	1
Cash dividends	28	–	–	–	–	(1, 3 39)	(1, 3 39)	(8)	(1 , 3 47)
Forward purchase of shares held by non-controlling interest	30	–	–	–	–	(1 43)	(1 43)	(24)	(167)
Total transactions with owners		–	–	–	–	(1,836)	(1,836)	(32)	(1,868)
Balance at 31 December 2023		74	254	(1 4, 22 9)	(1,060)	23 ,409	8,448	21	8,4 69

1. The merger reserve relates to the 1999 combination of Reckitt & Colman plc and Benckiser N.V. and a Group reconstruction in 2007 treated as a merger under Part 27 of the Companies Act 2006

2. Refer to Note26 for an explanation of other reserves

Group Statement of Changes in Equity

For the year ended 31 December 2023

159 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Note

		2023	2022
		£m	£m
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax		2,401	3 , 0 67
Net finance expense	6	130	1 61
Share of loss and impairment of equity-accounted investments	11	–	21
Operating profit from continuing operations		2,531	3 , 249
Profit on sale of property, plant and equipment and intangible assets		(3 4)	(82)
Depreciation, amortisation and impairment	9, 10	1, 290	6 07
Share-based payments	25	102	78
Decrease / (increase) in inventories		118	(25 4)
Increase in trade and other receivables		(87)	(23)
Decrease in payables and provisions		(91)	(145)
Cash generated from continuing operations		3,829	3, 430
Interest paid		(293)	(243)
Interest received		30	34
Tax paid		(922)	(83 1)
Net cash flows attributable to discontinued operations	32	(8)	7
Net cash generated from operating activities		2 ,636	2, 397
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment	10	(34 8)	(362)
Purchase of intangible assets	9	(10 1)	(81)
Proceeds from the sale of property, plant and equipment		63	84
Proceeds from sale of intangible assets and related businesses, net of cash disposed		1	247
Acquisition of businesses, net of cash acquired	29	(81)	(12)
Other investing activities		–	(15)
Net cash used in investing activities		(4 6 6)	(13 9)

Note

		2023	2022
		£m	£m
CASH FLOWS FROM FINANCING ACTIVITIES
Treasury shares reissued	24	48	54
Purchase of ordinary shares by employee share ownership trust		(2)	–
Repurchase of ordinary shares	24	(207)	–
Proceeds from borrowings	17	1,638	2 , 2 74
Repayment of borrowings	17	(1, 855)	(3 , 8 07)
Dividends paid to owners of the parent company	28	(1 ,3 39)	(1 , 249)
Dividends paid to non-controlling interests		(8)	(35)
Other financing activities		(8 4)	383
Net cash used in financing activities		(1,809)	(2, 3 8 0)
Net increase / (decrease) in cash and cash equivalents		3 61	(12 2)
Cash and cash equivalents at beginning of the year		1, 156	1 , 2 59
Exchange (losses) / gains		(1 37)	19
Cash and cash equivalents at end of the year		1,380	1 ,1 5 6
Cash and cash equivalents comprise:
Cash and cash equivalents	16	1, 387	1 ,1 5 7
Overdrafts	17	(7)	(1)
		1,380	1 ,1 5 6

1. Cash flows from other financing activities are principally composed of cash receipts and payments on derivative contracts

used to hedge foreign exchange gains or losses on non-Sterling financing assets and financing liabilities between the Group’s

treasury company and fellow Group subsidiaries

2. Included within cash and cash equivalents is £2 29million of cash (2022:£276million) which is restricted for use by the Group

but is available on demand and freely available for use within the relevant subsidiary (see Note16)

Group Cash Flow Statement

For the year ended 31 December 2023

160 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

1 Accounting Policies

The principal accounting policies adopted in the preparation of these Financial Statements are set out

below. Unless otherwise stated, these policies have been consistently applied to all the years presented.

Basis of preparation

These Financial Statements have been prepared in accordance with the recognition, measurement and

presentation requirements of UK-adopted International Accounting Standards and in accordance with

International Financial Reporting Standards (IFRS Accounting Standards) as issued by the International

Accounting Standards Board (IASB).

These Financial Statements have been prepared under the historical cost convention, as modified by the

revaluation of certain financial assets and liabilities (including derivative instruments) at fair value through

profit or loss or other comprehensive income. A summary of the Group’s accounting policies is set out

below. Historical cost is generally based on the fair value of the consideration given in exchange for

goods and services.

The preparation of Financial Statements that conform to IFRS requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities at the Balance Sheet date

and revenue and expenses during the reporting period. Although these estimates are based on

management’s best knowledge at the time, actual amounts may ultimately differ from those estimates.

New standards, amendments and interpretations

The following amended standards and interpretations were adopted by the Group during the year

ending 31 December 2023. These amended standards and interpretations have not had a significant

impact on the consolidated Financial Statements.

– Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12)

– Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)

– Definition of Accounting Estimates (Amendments to IAS 8)

– IFRS 17 Insurance Contracts

On 23 May 2023, the International Accounting Standards Board issued International Tax Reform—Pillar

Two Model Rules – Amendments to IAS 12. The Group has applied the mandatory temporary exception to

the accounting for deferred taxes arising from the jurisdictional implementation of the Pillar Two rules set

out therein.

The following new and amended standards are effective for annual periods beginning on or after

1 January 2024. The Group has not early adopted the new or amended standards, where applicable,

in preparing these consolidated Financial Statements. These amendments are not expected to have

a material impact on the Group in the current or future reporting periods:

– Classification of Liabilities as Current or Non-current (Amendments to IAS 1)

– Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)

– Supplier financing arrangements (Amendments to IAS 7 and IFRS 7)

– Lack of exchangeability (Amendments to IAS 21)

– Non-current liabilities with covenants (Amendments to IAS 1)

Going concern

Having assessed the principal risks and other matters discussed in connection with the Viability

Statement, the Directors considered it appropriate to adopt the going concern basis of accounting in

preparing the consolidated Financial Statements. When reaching this conclusion, the Directors took into

account the Group’s overall financial position, exposure to principal risks and future business forecasts.

At 31 December 2023, the Group had cash and cash equivalents (excluding restricted cash) of £1.2 billion.

The Group also had access to committed borrowing facilities of £4.5 billion, which were undrawn at year

end and of which £4.45 billion are not subject to renewal until 2025 onwards. Further detail is contained

within the Viability Statement on page 61 and within the liquidity disclosures in Note 15.

Basis of consolidation

The consolidated Financial Statements include the results of Reckitt Benckiser Group plc, a company

registered in the UK, and all its subsidiary undertakings made up to the same accounting date. Subsidiary

undertakings are those entities controlled by Reckitt Benckiser Group plc. Control exists where the

Group is exposed to, or has the rights to variable returns from its involvement with, the investee and has

the ability to use its power over the investee to affect its returns.

Intercompany transactions, balances and unrealised gains on transactions between Group companies

have been eliminated on consolidation. Unrealised losses have also been eliminated to the extent that

they do not represent an impairment of a transferred asset. The accounting policies of subsidiaries have

been changed where necessary to ensure consistency with accounting policies adopted by the Group.

Climate Change

In preparing the Financial Statements, management have considered the impact of climate change,

specifically with reference to the disclosures included in the Strategic Report and the Group’s 2030

Sustainability Ambitions, in particular in relation to impairment testing of intangible assets. These factors

have not had a significant effect on the Group’s critical accounting estimates and judgments made with

respect to the current year.

Notes to the Financial Statements

161 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Foreign currency translation

Items included in the Financial Statements of each of the Group’s entities are measured using the

currency of the primary economic environment in which the entity operates (the functional currency). The

consolidated Financial Statements are presented in Sterling, which is the Group’s presentational currency.

Foreign currency transactions are translated into the functional currency using exchange rates prevailing

at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement

of foreign currency transactions and from the translation of foreign currency denominated monetary

assets and liabilities are recognised in the Income Statement, except where hedge accounting is applied.

The Financial Statements of subsidiary undertakings with a non-Sterling functional currency are

translated into Sterling on the following basis:

– Assets and liabilities: at the rate of exchange ruling at the year end date

– Income Statement items: at the average rate of exchange for the year

Exchange differences arising from the translation of the net investment in subsidiary undertakings

with a non-Sterling functional currency, and of borrowings and other currency instruments designated

as hedges of such investments, are recorded in equity on consolidation.

Business combinations

The acquisition method is used to account for the acquisition of subsidiaries and businesses.

Identifiable net assets acquired (including intangible assets) in a business combination are measured

initially at their fair values at the acquisition date.

Where the measurement of the fair value of identifiable net assets acquired is incomplete at the end

of the reporting period in which the combination occurs, the Group will report provisional fair values.

Final fair values are determined within a year of the acquisition date and retrospectively applied.

The excess of the consideration transferred and the amount of any non-controlling interest over the fair

value of the identifiable assets (including intangibles), liabilities and contingent liabilities acquired is

recorded as goodwill.

The consideration transferred is measured at the fair value of the assets given, equity instruments issued

(if any), and liabilities assumed or incurred at the date of acquisition.

Acquisition-related costs are expensed as incurred.

The results of the subsidiaries and businesses acquired are included in the consolidated Financial

Statements from the acquisition date.

Assets held for sale and disposal groups

Non-current assets, or disposal groups comprising assets and liabilities, are classified as held for sale and

presented separately in the Balance Sheet when the following criteria are met: the Group is committed

to selling the asset or disposal group; it is available for immediate sale in its current condition; an active

plan of sale has commenced and been approved in line with Group policy; and in the judgement of Group

management it is highly probable that the sale will be completed within 12 months.

Immediately before the initial classification of the assets and disposal groups as held for sale, the

carrying amounts of the assets (or all the assets and liabilities in the disposal groups) are measured

in accordance with the applicable accounting standards. Goodwill (including cost and accumulated

impairment) is allocated to the disposal group using a relative value approach, unless a different method

better reflects goodwill associated with the disposal.

Assets held for sale and disposal groups are subsequently measured at the lower of their carrying

amount and fair value less costs of disposal. Impairment losses on initial classification as held for sale, and

subsequent gains and losses on remeasurement to fair value less costs of disposal, are recognised in the

Income Statement. Once classified as held for sale, intangible assets and property, plant and equipment

are no longer amortised or depreciated.

Disposals of intangible assets and subsidiaries

The financial performance of subsidiaries and businesses are included in the consolidated Financial

Statements up to the point at which the Group ceases to have control over that subsidiary. Intangible

assets not disposed of through the sale of shares in subsidiaries are treated as disposed at the point

that the Group ceases to control the asset.

The difference between the fair value of the consideration (net of costs) and the carrying value of the

assets and liabilities disposed is recognised as a gain or loss in the Income Statement. Any amounts

previously recognised in other comprehensive income in respect of that subsidiary or asset, including

exchange gains or losses on foreign currency translation, are accounted for as if the Group had directly

disposed of related assets and liabilities. This results in a reclassification of amounts previously

recognised in other comprehensive income to the Income Statement and included within the loss

on disposal of intangible assets and related businesses.

Where the assets and liabilities disposed represent a partial disposal of a cash generating unit to which

goodwill has been allocated, goodwill is allocated using a relative value approach to the disposal group,

unless a different method better reflects goodwill associated with the disposal.

Where the tax base will not be transferred with the disposed assets, the deferred tax balances relating

to the intangible assets are not considered part of the assets disposed and are instead credited or

charged to the Income Statement within income tax expense.

Notes to the Financial Statements continued

1 Accounting Policies continued

162 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Liquidation of subsidiaries

The Group liquidates subsidiaries that are no longer required in order to simplify the Group structure.

As part of this process, the Group ensures any outstanding matters relating to the subsidiary are resolved

before liquidation. Any amounts previously recognised in other comprehensive income in respect of

that subsidiary, including exchange gains and losses on foreign currency translation, are reclassified

to the Income Statement on disposal which is typically on entering liquidation. The amounts previously

recognised in other comprehensive income are included within finance income in the Income Statement.

Non-controlling interests

On an acquisition-by-acquisition basis, the non-controlling interest is measured at either fair value

or a proportionate share of the acquiree’s net assets.

Purchases of non-controlling interests are accounted for as transactions with the owners and therefore

no goodwill is recognised as a result of such transactions.

Revenue

Revenue from the sale of products is recognised in the Group Income Statement as and when

performance obligations are satisfied by transferring control of the product or service to the customer.

Net Revenue is defined as the amount invoiced to external customers during the year and comprises,

as required by IFRS 15, gross sales net of trade spend, customer allowances for credit notes, returns

and consumer coupons. The methodology and assumptions used to estimate credit notes, returns and

consumer coupons are monitored and adjusted regularly in the light of contractual and legal obligations,

historical trends, past experience and projected market conditions.

Trade spend, which consists primarily of customer pricing allowances, placement/listing fees

and promotional allowances, is governed by sales agreements with the Group’s trade customers

(retailers and distributors). Trade spend also includes reimbursement arrangements under the Special

Supplemental Nutrition Program for Women, Infants and Children (WIC), payable to the respective

US state WIC agencies.

Accruals are recognised under the terms of these agreements to reflect the expected activity level

and the Group’s historical experience. These accruals are reported within trade and other payables.

Value-added tax and other sales taxes are excluded from Net Revenue.

Operating segments

Operating segments are reported in a manner consistent with the internal reporting provided to

the Chief Operating Decision Maker (CODM). The CODM, who is responsible for allocating resources

and assessing performance of the operating segments, has been identified as the Group

Executive Committee.

Research and development

Research expenditure is expensed in the year in which it is incurred.

Development expenditure is expensed in the year in which it is incurred, unless it meets the requirements

of IAS 38 to be capitalised and then amortised over the useful life of the developed product.

Income tax

Income tax on the profit for the year comprises current and deferred tax. Income tax is recognised in

the Income Statement except to the extent that it relates to items recognised in other comprehensive

income or directly in equity, in which case the tax is also recognised in other comprehensive income

or directly in equity, respectively.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or

substantively enacted in each jurisdiction at the Balance Sheet date, and any adjustment to tax payable

in respect of previous years.

Deferred tax is provided in full, using the liability method, on temporary differences arising between

the tax bases of assets and liabilities and their carrying amounts in the consolidated Financial

Statements. Deferred tax is not accounted for if it arises from the initial recognition of an asset or

liability in a transaction (other than a business combination) that affects neither accounting nor taxable

profit or loss at that time. Deferred tax is determined using tax rates (and laws) that have been enacted

or substantively enacted at the Balance Sheet date and are expected to apply when the deferred tax

asset or liability is settled. Deferred tax assets are recognised to the extent that it is probable that future

taxable profit will be available against which the temporary differences can be utilised.

Deferred tax is provided on temporary differences arising on investments in subsidiaries except where

the investor is able to control the timing of the reversal of the temporary differences and it is probable

that the temporary difference will not reverse in the foreseeable future.

Deferred tax assets and liabilities within the same tax jurisdiction are offset where there is a legally

enforceable right to offset current tax assets against current tax liabilities and where there is an intention

to settle these balances on a net basis.

Notes to the Financial Statements continued

1 Accounting Policies continued

163 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Goodwill and other intangible assets

(i) Goodwill

Goodwill is allocated to the cash generating unit (CGU), or group of CGUs (GCGU), to which it relates

and is tested annually for impairment. Goodwill is carried at cost less accumulated impairment losses.

(ii) Brands

Separately acquired brands are shown at cost less accumulated amortisation and impairment.

Brands acquired as part of a business combination, and that are separately identifiable, are recognised

at fair value and amortised over their useful economic life as determined at the acquisition date

(up to 20 years), except when their life is determined as being indefinite.

Applying indefinite lives to certain acquired brands is appropriate due to the stable long-term nature

of the business and the enduring nature of the brands. A core element of the Group’s strategy is to invest

in building its brands through an ongoing programme of product innovation and continuing marketing

investment. Within the Group, a brand typically comprises an assortment of base products and more

innovative products. Both contribute to the enduring nature of the brand. The base products establish

the long-term positioning of the brand while a succession of innovations attracts ongoing consumer

interest and attention. Indefinite life brands are allocated to the CGUs or GCGUs to which they relate

and are tested annually for impairment.

The Directors also review the useful economic life of brands annually, to ensure that these lives are still

appropriate. If a brand is considered to have a finite life, its carrying value is amortised over its remaining

estimated useful economic life.

(iii) Software

Expenditure relating to the acquisition of computer software licences and systems are capitalised

at cost. The assets are amortised on a straight-line basis over a period of seven years for systems

and five years or less for all other software licences.

(iv) Distribution rights

Payments made in respect of product registration, acquired and reacquired distribution rights are

capitalised where the rights comply with the above requirements for recognition of acquired brands.

If the registration or distribution rights are for a defined time period, the intangible asset is amortised

over that period. If no time period is defined, the intangible asset is treated in the same way as

acquired brands.

(v) Customer contracts

Acquired customer contracts are capitalised at cost. These costs are amortised on a straight-line basis

over the period of the contract.

(vi) Customer relationships

Customer relationships are shown at cost less accumulated amortisation and impairment. Customer

relationships acquired as part of a business combination, and that are separately identifiable, are

recognised at fair value and amortised over their useful economic life as determined at the acquisition

date (up to 10 years).

(vii) Acquired intellectual property

Intellectual property rights acquired as part of the business and that are separately identifiable are

recognised at fair value and amortised over their useful economic life as determined at the acquisition

date (up to 20 years).

Amortisation of intangible assets in (ii) to (vii) is charged to cost of goods sold or net operating expenses

depending on the use of the asset.

Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and impairment, with

the exception of freehold land, which is shown at cost less impairment. Cost includes expenditure

that is directly attributable to the acquisition of the asset. Except for freehold land and assets under

construction, the cost of property, plant and equipment is depreciated on a straight-line basis over the

period of the expected useful life of the asset. For this purpose, expected lives are determined within

the following limits:

– freehold buildings: not more than 50 years;

– leasehold land and buildings: the lesser of 50 years or the life of the lease; and

– owned plant and equipment: not more than 15 years (except for environmental assets and spray dryers

which are not more than 30 years).

In general, production plant and equipment and office equipment are depreciated over 10 years or less

and motor vehicles and computer equipment over 5 years or less.

Assets’ residual values and useful lives are reviewed, and adjusted if necessary, at each Balance Sheet

date. Property, plant and equipment is reviewed for impairment if events or changes in circumstances

indicate that the carrying amount may not be appropriate. Freehold land is reviewed for impairment on

an annual basis.

Gains and losses on the disposal of property, plant and equipment are determined by comparing the

asset’s carrying value with any sale proceeds and are included in the Income Statement.

Notes to the Financial Statements continued

1 Accounting Policies continued

164 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Leases

The Group has various lease arrangements for buildings (such as offices and warehouses), cars,

and IT and other equipment. Lease terms are negotiated on an individual basis locally and subject to

domestic rules and regulations. At the inception of a lease contract, the Group assesses whether the

contract conveys the right to control the use of an identified asset for a certain period in exchange

for consideration, in which case it is identified as a lease. The Group recognises a right of use asset and

a corresponding lease liability with respect to all lease arrangements in which it is the lessee, except

for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value

assets. Low value leases are those with an underlying asset value of USD 5,000 or less. For these leases,

the Group recognises the lease payments as an operating expense on a straight-line basis over the term

of the lease.

Right of use assets

At commencement date, right of use assets are measured at cost, which comprises the following:

– the initial measurement of the lease liability;

– prepayments before commencement date of the lease;

– initial direct costs; and

– costs to restore.

Subsequent to initial recognition right of use assets are depreciated on a straight-line basis over the

duration of the contract. Right of use assets are assessed for impairment where indicators of impairment

are present.

Lease liabilities

At commencement date, lease liabilities are measured at the present value of lease payments not yet

paid including:

– fixed payments excluding lease incentive receivables;

– future contractually agreed fixed increases; and

– payments related to renewals or early termination, when options to renew or for early termination

are reasonably certain to be exercised.

Subsequent to initial recognition lease liabilities are increased by the interest costs on the lease liabilities

and decreased by lease payments made. Lease liabilities held are remeasured to account for revised

future payments.

Impairment of assets

Assets that have indefinite lives, including goodwill and brands, are tested annually for impairment

at the level where cash flows are considered to be largely independent. This testing is performed

at either the CGU or GCGU level. All CGUs and GCGUs are tested for impairment if there is an event

or circumstance that indicates that their carrying value may not be recoverable. If the carrying

value exceeds its recoverable amount an impairment loss is recognised in the Income Statement.

The recoverable amount is the higher of the CGU’s or GCGU’s value-in-use and its fair value less costs

of disposal.

Value-in-use is calculated with reference to the future and terminal cash flows expected to be

generated by each CGU or GCGU (or group of assets where cash flows are not identifiable to specific

assets). The discount rates used in the impairment reviews are based on weighted average cost of

capital (WACC) specific to each CGU and GCGU, with the WACC converted to the implied pre-tax rates.

Fair value less costs of disposal is calculated using a discounted cash flow approach prepared on a

market participant basis, with a post-tax discount rate applied to projected risk-adjusted post-tax cash

flows and terminal value.

Inventories

Inventories are stated at the lower of cost and net realisable value. Cost comprises materials, direct labour

and an appropriate portion of overhead expenses (based on normal operating capacity) required to get

the inventory to its present location and condition. Inventory valuation is determined on a first in, first out

(FIFO) basis. Net realisable value represents the estimated selling price less applicable selling expenses.

Trade and other receivables

Trade and other receivables are initially recognised at the fair value of consideration less transaction

costs and subsequently held at amortised cost, less provision for discounts and doubtful debts.

Allowance losses are calculated by reviewing lifetime expected credit losses using historic and forward-

looking data on credit risk.

Trade and other payables

Trade and other payables are initially recognised at fair value including transaction costs and

subsequently carried at amortised cost.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances and other deposits with a maturity of less than three

months when deposited.

For the purpose of the Cash Flow Statement, bank overdrafts that form an integral part of the Group’s

cash management, and are repayable on demand, are included as a component of cash and cash

equivalents. Bank overdrafts are included within short-term borrowings in the Balance Sheet.

Notes to the Financial Statements continued

1 Accounting Policies continued

165 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Borrowings

Interest-bearing borrowings are recognised initially at fair value less, where permitted by IFRS 9, any

directly attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings

are stated at amortised cost with any difference between cost and redemption value being recognised

in the Income Statement over the period of the borrowings on an effective interest basis.

Cash flows relating to interest are presented within operating cash flows. Proceeds and repayment of

principal amounts are presented as financing cash flows and are presented gross, except for borrowings

with maturities of less than three months (including commercial paper), which are presented net.

Derivative financial instruments and hedging activity

The Group may use derivatives to manage its exposures to fluctuating interest and foreign exchange rates.

These instruments are initially recognised at fair value on the date the contract is entered into and are

subsequently remeasured at their fair value. The method of recognising the resulting gain or loss depends on

whether the derivative is designated as a hedging instrument and, if so, the nature of the item being hedged.

At the inception of designated hedge relationships, the Group documents its risk management objectives

and strategy for undertaking various hedging transactions. The Group also documents its assessment,

both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging

transactions are highly effective in offsetting changes in cash flows or fair values of hedged items.

The Group designates certain derivatives as either:

– hedges of a particular risk associated with a recognised asset or liability or a highly probable forecast

transaction (cash flow hedges); or

– hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value hedges).

Derivatives designated as cash flow hedges

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash

flow hedges is recognised in other comprehensive income and accumulated in the hedging reserve.

Any gain or loss relating to the ineffective portion is recognised immediately in the Income Statement.

When the hedged forecast transaction subsequently results in the recognition of a non-financial item

such as inventory, the amount accumulated in the hedging reserve and the cost of hedging reserve

is included directly in the initial cost of the non-financial item when it is recognised. For all other

transactions, the amounts accumulated in the hedging reserve are recycled to the Income Statement

in the period (or periods) when the hedged item affects the Income Statement.

If the hedge no longer meets the criteria for hedge accounting or the hedging instrument is sold, expires,

is terminated, or is exercised, then hedge accounting is discontinued prospectively. The amount that has

been accumulated in the hedging reserve remains in equity until it is either included in the cost of a

non-financial item or recycled to the Income Statement.

Derivatives designated as fair value hedges

Fair value hedges are used to manage the currency and/or interest rate risks to which the fair value

of certain assets and liabilities are exposed. Changes in the fair value are recognised in the Income

Statement, together with any changes in the fair value of the hedged asset or liability that are

attributable to the hedged risk. If such a hedge relationship no longer meets hedge accounting criteria,

fair value movements on the derivative continue to be taken to the Income Statement while any fair

value adjustments made to the underlying hedged item to that date are amortised through the Income

Statement over its remaining life using the effective interest rate method.

Changes in the fair value of any derivative instruments that do not qualify for hedge accounting are

recognised immediately in the Income Statement.

Net investment hedges

Gains and losses on those hedging instruments designated as hedges of the net investments in foreign

operations are recognised in other comprehensive income to the extent that the hedging relationship

is effective. Gains and losses accumulated in the foreign currency translation reserve are recycled

to the Income Statement when the foreign operation is disposed of.

Equity investments

Equity investments are investments that are neither held for trading nor classified as investments in

subsidiaries, associates or joint arrangements. Subsequent to their initial recognition, equity investments

are stated at their fair value. Gains and losses arising from subsequent changes in the fair value are

recognised in the Income Statement or in other comprehensive income on a case-by-case basis.

Accumulated gains and losses included in other comprehensive income are not recycled to the Income

Statement. Dividends from other investments are recognised in the Income Statement.

Investment in associates

Investments in associates are accounted for using the equity method. An associate is an entity over

which the Group has significant influence, being the power to participate in the investee’s financial and

operating policy decisions without control or joint control.

Interests in associates are stated in the consolidated Balance Sheet at cost, adjusted for the movement

in the Group’s share of their net assets and liabilities. The Group’s share of the profit or loss after tax

of associates is included in the Group’s consolidated profit before taxation. Unrealised intragroup profits

or losses from transactions are offset against the carrying amount of the investment on a pro-rata basis

during consolidation, if material.

When the Group’s share of losses exceeds its interest in an associate, the Group does not recognise

further losses, unless it has incurred obligations or made payments on behalf of the associate.

The Financial Statements of the companies accounted for using the equity method are prepared

in accordance with uniform accounting and measurement methods throughout the Group.

Notes to the Financial Statements continued

1 Accounting Policies continued

166 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Employee share schemes

Incentives in the form of shares are provided to employees under equity-settled share option

and restricted share schemes, which have various combinations of market-based and non-market

performance conditions, service conditions, and non-vesting conditions.

The fair value determined at the award grant date takes into account the probability of any relevant

market-based performance conditions and non-vesting conditions being satisfied and is subsequently

expensed on a straight-line basis over the vesting period, based on the Group’s estimate of equity

instruments that will eventually vest. This estimate takes into account the expected outcome for

relevant non-market performance conditions and service conditions but assumes satisfaction of all

market-based performance conditions and non-vesting conditions. At each Balance Sheet date, the

Group revises its estimate of the number of equity instruments expected to vest. The impact of the

revision of the original estimates, if any, is recognised in the Income Statement such that the cumulative

expense reflects the revised estimate, with a corresponding adjustment to equity reserves.

Additional employer costs, including social security taxes, in respect of options and awards are charged

to the Income Statement over the same period with a corresponding liability recognised.

Pension commitments

Group companies operate defined contribution and (funded and unfunded) defined benefit

pension plans.

The cost of providing pensions to employees who are members of defined contribution plans is charged

to the Income Statement as contributions are made. The Group has no further payment obligations once

the contributions have been paid.

The deficit or surplus recognised in the Balance Sheet in respect of defined benefit pension plans is

the present value of the defined benefit obligation at the Balance Sheet date, less the fair value of the

plan assets. The defined benefit obligation is calculated annually by independent actuaries using the

projected unit credit method. The present value of the defined benefit obligation is determined by

discounting the estimated future cash flows by the yield on high-quality corporate bonds denominated

in the currency in which the benefits will be paid, and that have a maturity approximating to the terms of

the pension obligations. The costs of providing these defined benefit plans are accrued over the period

of employment. Actuarial gains and losses are recognised immediately in other comprehensive income.

Past service costs are recognised immediately in the Income Statement.

The net interest amount is calculated by applying the discounted rate used to measure the defined

benefit obligation at the beginning of the period to the net defined benefit liability/asset.

The net pension plan interest is presented as other finance income/other finance expense.

Post-retirement benefits other than pensions

Some Group companies provide post-retirement medical care to their retirees. The costs of providing

these benefits are accrued over the period of employment and the liability recognised in the Balance

Sheet is calculated using the projected unit credit method and is discounted to its present value and

the fair value of any related asset is deducted.

Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result

of past events; it is more likely than not that there will be an outflow of resources to settle that

obligation; and the amount can be reliably estimated. Provisions are valued at the present value of the

Directors’ best estimate of the expenditure required to settle the obligation at the Balance Sheet date.

Where it is possible that an outflow of resources may be required to settle the obligation or it is not

possible to make a reliable estimate of the estimated financial impact, appropriate disclosure is made

but no provision recognised.

Repurchase and reissuance of ordinary shares

When shares recognised as equity are repurchased, the amount of the consideration paid, including

directly attributable costs, is recognised as a charge to equity. Repurchased shares are classified as

Treasury shares and are presented in retained earnings. When Treasury shares are sold or reissued

subsequently, the amount received is recognised as an increase in equity and any resulting surplus

is presented within share premium or deficit presented within retained earnings.

Dividend distribution

Dividends to owners of the parent company are recognised as a liability in the period in which the

dividends are approved by the company’s shareholders. Interim dividends are recorded in the period

in which they are approved and paid.

Dividend payments are recorded at fair value. Where non-cash dividend payments are made, gains arising

as a result of fair value remeasurements are recognised in the Income Statement in the same period.

Accounting estimates and judgements

In preparing these consolidated Financial Statements, management has made judgements and estimates

that affect the application of the Group’s accounting policies and the reported amounts of assets,

liabilities, income and expenses. Actual amounts and results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting

estimates are recognised in the period in which the estimate is revised if the revision affects only

that period, or in the period of the revision and future periods if the revision affects both current

and future periods.

Notes to the Financial Statements continued

1 Accounting Policies continued

167 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Critical judgements in applying the Group’s accounting policies

Over the course of the year, management has made a number of critical judgements in the application

of the Group’s accounting policies. These include the following:

– management has made judgments relating to the allocation of consideration between the different

elements in the forward contract to purchase the non-controlling interest in RB Manon as outlined

in Note 30;

– management has identified matters (including the Korea Humidifier Sanitiser, Necrotizing Enterocolitis

and Phenylephrine issues) that may incur liabilities in the future but does not recognise these liabilities

when it is too early to determine the likely outcome or make a reliable estimate (Note 18, Note 20);

– the continuing enduring nature of the Group’s brands supports the indefinite life assumption for

certain of these assets (Note 9); and

– assumptions are made as to the recoverability of tax assets especially as to whether there will be

sufficient future taxable profits in the same jurisdictions to fully utilise losses in future years (Note 12).

Key sources of estimation uncertainty

Each year, management is required to make a number of assumptions regarding the future. The related

year end accounting estimates will, by definition, seldom equal the final actual results. The estimates

and assumptions that have a significant risk of causing a material adjustment to the carrying amounts

of assets and liabilities within the next financial year are addressed below.

Goodwill and indefinite life intangible assets:

Under IFRS, goodwill and other indefinite life intangible assets must be tested for impairment on at least

an annual basis. As disclosed further in Note 9, this testing generally requires management to make

multiple estimates, for example around individual market pressures and forces, future price and volume

growth, future margins, terminal growth rates and discount rates.

The recoverability of the Group’s goodwill and indefinite-lived intangible assets in relation to IFCN is

sensitive to reasonably possible changes in key assumptions. Further information on key estimates and

assumptions, including details on the sensitivities of the value-in-use estimates to reasonable changes

in key assumptions, is included in Note 9.

Tax:

The actual tax paid on profits is determined based on tax laws and regulations that differ across the

numerous jurisdictions in which the Group operates. Assumptions are made in applying these laws to

the taxable profits in any given period in order to calculate the tax charge for that period. Where the

eventual tax paid or reclaimed is different to the amounts originally estimated, the difference is charged

or credited to the Income Statement in the period in which it is determined (Note 7).

The Group operates in an international tax environment and is subject to tax examinations and

uncertainties in a number of jurisdictions. The issues involved can be complex and disputes may take a

number of years to resolve. Each uncertainty is separately assessed and management applies judgement

in the recognition and measurement of the uncertainty based on the relevant circumstances. The

exposure recognised is calculated based on the expected value method or the most likely outcome

method, depending on whether there are a wide range of possible outcomes or if resolution of the

uncertainty is concentrated on one outcome. In particular, the range of possible outcomes relating to

transfer pricing exposures can be wide and, in these scenarios, the expected value method is employed.

The accounting estimates and judgements considered include:

– status of the unresolved matter;

– clarity of relevant legislation and related guidance;

– pre-clearances issued by taxing authorities;

– advice from in-house specialists and opinions of professional firms;

– resolution process and range of possible outcomes;

– past experience and precedents set by the particular taxing authority;

– decisions and agreements reached in other jurisdictions on comparable issues;

– unutilised tax losses, tax credits and availability of mutual agreement procedures between tax

authorities; and

– statute of limitations.

Management is of the opinion that the carrying values of the liability for uncertain tax positions made in

respect of these matters represent its best estimate once all facts and circumstances have been taken

into account. Nevertheless, the final amounts paid to discharge the liabilities arising (either through

negotiated settlement or litigation) may be different from the position recognised. The net liabilities

recognised in respect of uncertain tax positions as at 31 December 2023 are £619 million

(2022: £722 million) (Note 22).

Notes to the Financial Statements continued

1 Accounting Policies continued

168 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Trade spend:

The Group provides for amounts payable to our trade customers for promotional activity and

government reimbursement arrangements. Where an activity spans the year end, an accrual is reflected

in the consolidated Financial Statements based on our estimation of customer and consumer uptake

during the relevant period and the extent to which temporary funded activity has occurred. As there is a

timing difference between that initial estimation and final settlement of trade spend with our customers,

differences can result on final settlement. As at 31 December 2023, the Group recognised total accruals

of £1,125 million (2022: £1,137 million) in respect of amounts payable to trade customers and government

bodies for trade spend. The Group’s trade spend arrangements vary considerably by market and

category, and the Group’s trade spend accruals are made up of many individually small accruals.

Therefore, an aggregated disclosure of sensitivity analysis on the key inputs to trade spend accrual

estimates would not be practicable nor meaningful. Nevertheless, a 13% (2022: 11%) difference between

those initial estimates and final settlement would cause a material charge or credit to the Income

Statement in the next financial year. During 2023, adjustments to trade spend accruals as at 31 December

2022, due to changes in accounting estimates, were £132 million (2022: £110 million adjustment to trade

spend accruals as at 31 December 2021, due to changes in accounting estimates).

Legal provisions:

The Group recognises legal provisions when the Group has a present legal or constructive obligation as

a result of past events; it is more likely than not that there will be an outflow of resources to settle that

obligation; and the amount can be reliably estimated. The level of provisioning in relation to civil and/or

criminal investigations is an area where management and legal judgement are important, with individual

provisions being based on best estimates of the possible loss, considering all available information,

external advice and historical experience. As at 31 December 2023, the Group recognised legal

provisions of £137 million (2022: £221 million) in relation to a number of historical regulatory and other

matters in various jurisdictions.

2 Operating Segments

The Group’s operating segments comprise the Hygiene, Health and Nutrition business units reflecting

the way in which information is presented to and reviewed by the Group’s Chief Operating Decision

Maker (CODM) for the purposes of making strategic decisions and assessing Group-wide performance.

The CODM is the Group Executive Committee. This Committee is responsible for the implementation of

strategy (approved by the Board), the management of risk (delegated by the Board) and the review of

Group operational performance and ongoing business integration.

The Group Executive Committee assesses the performance of these operating segments based on

Net Revenue from external customers and segment profit being adjusted operating profit. Intercompany

transactions between operating segments are eliminated. Finance income and expense are not

allocated to segments, as each is managed on a centralised basis.

The segment information for the operating segments for the year ended 31 December 2023 and

31 December 2022 is as follows:

				Adjusting
	Hygiene	Health	Nutrition	items	Total
Year ended 31 December 2023	£m	£m	£m	£m	£m
Net revenue	6,135	6,062	2,410	–	14,607
Depreciation and amortisation
(Note 9 & 10)	(155)	(193)	(96)	(26)	(470)
Operating profit	1,236	1,690	447	(842)	2,531
Net finance expense					(130)
Profit before income tax					2,401
Income tax charge					(753)
Net profit from continuing operations					1,648

				Adjusting
	Hygiene	Health	Nutrition	items	Total
Year ended 31 December 2022	£m	£m	£m	£m	£m
Net revenue	5,960	5,992	2,501	–	14,453
Depreciation and amortisation	(135)	(177)	(90)	(35)	(437)
Operating profit	1,214	1,648	577	(190)	3,249
Net finance expense					(161)
Impairment of equity-accounted
investments					(19)
Share of loss of equity-accounted
investments, net of tax					(2)
Profit before income tax					3,067
Income tax charge					(711)
Net profit from continuing operations					2,356

Financial information for the Hygiene, Health and Nutrition operating segments is presented on an

adjusted basis which excludes certain cash and non-cash items. These items have a pattern of recognition

that is largely uncorrelated with the trading performance of the business. Financial information on an

adjusted basis is consistent with how management reviews the business for the purpose of making

operating decisions. Further detail on adjusting items, which includes in the year to 31 December 2023

the £810 million impairment of IFCN goodwill (see Note 9) is included on pages 223-227.

Notes to the Financial Statements continued

1 Accounting Policies continued

169 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The company is domiciled in the UK. The split of Net Revenue from external customers and Non-current

assets (other than equity instruments, deferred tax assets and retirement benefit surplus assets) between

the UK, the US (being the biggest country outside the country of domicile) and that from all other countries is:

2023

			All other
		US	countries	Total
	£m	£m	£m	£m
Net Revenue	886	4,538	9,183	14,607
Goodwill and other intangible assets	1,903	9,646	7,039	18,588
Property, plant and equipment	290	768	1,341	2,399
Other non-current receivables (excluding Derivative
financial instruments)	12	18	92	122

2022

			All other
	UK	US	countries	Total
	£m	£m	£m	£m
Net Revenue	778	4,603	9,072	14,453
Goodwill and other intangible assets	1,875	10,905	7,423	20,203
Property, plant and equipment	314	828	1,331	2,473
Other non-current receivables	22	54	81	157

Major customers are typically large grocery chains, multiple retailers and e-commerce platforms.

The Group’s customer base is diverse with no individual customer accounting for more than 10%

of net revenue (2022: no individual more than 10% of revenue).

3 Analysis of Net Operating Expenses

	2023	2022
	£m	£m
Distribution costs	(3,703)	(3,438)
Research and development costs	(337)	(325)
Other administrative expenses	(1,382)	(1,205)
Impairment of goodwill	(810)	(167)
Gain on disposal of intangible assets and related businesses	–	14
Other net operating income	3	9
Net operating expenses	(6,229)	(5,112)

Other administrative expenses includes a net foreign exchange loss of £6 million (2022: loss of

£13 million). In 2023, Other administrative expenses includes a gain of £36 million (2022: £59 million)

relating to property disposals .

Impairment of goodwill of £810 million in 2023 relates to the IFCN business, which comprises the Nutrition

operating segment. The impairment of goodwill in 2022 of £167 million principally comprises a charge of

£152 million from the impairment of goodwill related to the acquisition of Biofreeze (see Note 9).

Biofreeze is reported in the Health operating segment.

4 Auditor Remuneration

During the year, the Group (including its overseas subsidiaries) obtained the following services from the

company’s Auditor and its associates:

	2023	2022
	£m	£m
Audit services pursuant to legislation
Audit of the Group’s Annual Report and Financial Statements	8.9	8.4
Audit of the Financial Statements of the Group’s subsidiaries	10.5	11.1
Audit-related assurance services	0.9	0.8
Total audit and audit-related services	20.3	20.3
Fees payable to the company’s Auditor and its associates for other services
Other assurance services	0.4	2.7
Total non-audit services	0.4	2.7
	20.7	23.0

5 Employee Costs

Total employee costs, including those for Directors, were:

Note

		2023	2022
		£m	£m
Wages and salaries		2,126	1,988
Social security costs		281	281
Other pension costs	23	60	61
Share-based payments	25	102	78
Total staff costs		2,569	2,408

Executive and Non-Executive Directors’ aggregate emoluments are disclosed on pages 100-132 of the

Directors’ Remuneration Report. Compensation awarded to key management (defined as the members

of the Group Executive Committee and the Non-Executive Directors) was:

	2023	2022
	£m	£m
Short-term employee benefits	31	26
Post-employment and other long-term benefits	–	–
Share-based payments	22	15
	53	41

Notes to the Financial Statements continued

2 Operating Segments continued

170 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Staff numbers

The monthly average number of people employed by the Group, including Directors, during the year was:

	2023	2022
	’000	’000
North America	5.2	5.1
Europe/ANZ	14.2	14.3
Rest of world	20.7	20.6
	40.1	40.0

6 Net Finance Expense

	2023	2022
	£m	£m
Finance income
Foreign exchange net gain on liquidation of subsidiaries	130	69
Interest income on cash and cash equivalents	41	29
Pension net finance income	8	5
Foreign exchange gains on intercompany financing, net of hedging	21	–
Finance income on tax balances	–	26
Other finance income	10	1
Total finance income	210	130
Finance expense
Interest payable on borrowings	(295)	(233)
Foreign exchange losses on intercompany financing, net of hedging	–	(24)
Finance expense on tax balances	(22)	–
Other finance expense	(23)	(34)
Total finance expense	(340)	(291)
Net finance expense	(130)	(161)

As a result of the simplification of the Group’s legal entity structure, a number of entities were liquidated.

Upon liquidation, the cumulative foreign exchange reserves were recycled to the Income Statement,

resulting in a net foreign exchange gain of £130 million (2022: a net foreign exchange gain of £69 million).

7 Income Tax Expense

	2023	2022
	£m	£m
Current tax	783	766
Adjustment in respect of prior periods	22	(23)
Total current tax	805	743
Origination and reversal of temporary differences	(51)	(20)
Impact of changes in tax rates	(1)	(5)
Total deferred tax	(52)	(25)
Cumulative foreign exchange on deferred tax balances reclassified to the Income Statement	–	(7)
Income tax charge	753	711

Current tax includes tax incurred by UK entities of £108 million (2022: £177 million). This is comprised

of UK corporation tax of £63 million (2022: £126 million) and overseas tax suffered of £45 million

(2022: £51 million). UK current tax is calculated at 23.5% (2022: 19%) of the estimated assessable profit

for the year, net of relief for overseas taxes where available. Taxation in other jurisdictions is calculated

at the rates prevailing in the relevant jurisdictions.

Cash tax paid in the year was £922 million (2022: £831 million). The variance from the current year

tax charge of £783 million is attributable to movements on uncertain tax positions (shown in Note 22)

and timing differences arising between the accrual and payment of current income tax liabilities.

Origination and reversal of temporary differences includes adjustments in respect of prior periods

of £11 million expense (2022: £19 million benefit).

Cumulative foreign exchange on deferred tax balances reclassified to the Income Statement is £nil

(2022: £7 million). This balance relates to deferred tax on assets disposed in 2022 (see Note 29).

Notes to the Financial Statements continued

5 Employee Costs continued

171 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The total tax charge on the Group’s profit for the year can be reconciled to the notional tax charge

calculated at the UK tax rate as follows:

Continuing operations

	2023	2022
	£m	£m
Profit before income tax	2,401	3,067
Tax at the notional UK corporation tax rate of 23.5% (2022: 19%)	564	583
Effect of:
Overseas tax rates	43	114
Movement in provision related to uncertain tax positions	(50)	(58)
Net impact of divestments and assets reclassified to held for sale	(6)	(25)
Unrecognised tax losses, other unrecognised tax assets and deferred tax
liability on unremitted earnings	(34)	71
Cumulative foreign exchange on deferred tax balances reclassified to the Income Statement	–	(7)
Withholding and local taxes	30	47
Reassessment of prior year estimates	33	(42)
Impact of changes in tax rates	(1)	(5)
Non-taxable foreign exchange gain arising from legal entity simplification
(Note 6)	(31)	(13)
Non-deductible impairment of goodwill	190	28
Other permanent differences	15	18
Income tax charge	753	711

Our effective tax rate in any given financial year reflects a variety of factors that may not be present

in succeeding financial years and may be affected by variations in profit mix and changes in tax laws,

regulations and related interpretations.

The Group is within the scope of the OECD Pillar Two rules which take effect on 1 January 2024. The UK

government substantively enacted legislation on 20 June 2023 that translated the Pillar Two rules into UK

law. The impact of the Pillar Two rules is not expected to be in excess of a 0.5% increase to the Group’s

Effective Tax Rate. This excludes the effect of changes to tax rates introduced by countries in response

to the Pillar Two rules.

The Group has applied the temporary mandatory exception from accounting for deferred taxes arising

from the Pillar Two model rules as set out in ‘International Tax Reform – Pillar Two Model Rules

(Amendments to IAS 12)’ issued by the IASB in May 2023.

The effect of overseas tax rates represents the impact of profits arising outside the UK that are taxed

at different rates to the UK rate. The UK tax rate increased from 19% to 25% on 1 April 2023. The 2023 rate

of 23.5% represents the blended UK tax rate over the 12 month period to 31 December 2023.

Withholding and local taxes suffered in the year are adjusted for previously accrued deferred tax

liabilities on unremitted earnings.

The reassessment of prior year estimates includes settlements reached following conclusion of tax

authority review and differences between final tax return submissions and liabilities accrued in these

Financial Statements.

The 2023 impact of non-deductible goodwill impairment is attributable to IFCN. The 2022 impact related

to non-deductible goodwill impairment attributable to Biofreeze.

UK deferred tax assets and liabilities have been calculated based on the substantively enacted rate of

25% after factoring in the expected timing of reversal of the related temporary differences (2022: 25%).

We conduct business operations in a number of countries and are therefore subject to tax and

intercompany pricing laws in multiple jurisdictions. We have in the past faced, and may in the future

face, audits and challenges brought by tax authorities, and we are involved in ongoing tax investigations

in a number of countries. If material challenges were to be successful, our effective tax rate may

increase, we may be required to modify structures at significant costs to us, we may also be subject

to interest and penalty charges and we may incur costs in defending litigation or reaching a settlement.

Any of the foregoing could materially and adversely affect our business, financial condition and results

of operations.

There have been no substantive updates to the EC State Aid matters referred to in the 2022 notes to the

financial statements.

Notes to the Financial Statements continued

7 Income Tax Expense continued

172 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The tax (charged)/credited relating to components of other comprehensive income is as follows:

		2023			2022
		Tax (charge)/			Tax (charge)/
	Before tax	credit	After tax	Before tax	credit	After tax
	£m	£m	£m	£m	£m	£m
Net exchange (losses)/gains
on foreign currency
translation	(639)	–	(639)	1,065	–	1,065
Reclassification of foreign
currency translation
reserves on disposals or liquidation of foreign
operations	(131)	–	(131)	(56)	–	(56)
Gains/(losses) on cash flow
and net investment hedges	14	(11)	3	(112)	(1)	(113)
Remeasurement of defined
benefit pension plans
(Note 23)	(42)	16	(26)	29	(5)	24
Revaluation of equity instruments	(10)	–	(10)	(109)	22	(87)
Other comprehensive
(expense)/income	(808)	5	(803)	817	16	833
Current tax		–			13
Deferred tax (Note 12)		5			3
		5			16

The tax charged directly to the Statement of Changes in Equity during the year is as follows:

	2023	2022
	£m	£m
Current tax	1	(1)
	1	(1)

8 Earnings Per Share

	2023	2022
	pence	pence
Basic earnings per share
From continuing operations	227.9	326.7
From discontinued operations	1.3	(1.0)
Total basic earnings per share	229.2	325.7
Diluted earnings per share
From continuing operations	227. 4	325.7
From discontinued operations	1.3	(1.0)
Total diluted earnings per share	228.7	324.7

Basic

Basic earnings per share is calculated by dividing the net income attributable to owners of the parent

company from continuing operations (2023: £1,634 million income, 2022: £2,337 million income) and

discontinued operations (2023: £9 million income; 2022: £7 million loss) by the weighted average number

of ordinary shares in issue during the year (2023: 716,700,954; 2022: 715,284,629).

Diluted

Diluted earnings per share is calculated by adjusting the weighted average number of shares outstanding

to assume conversion of all potentially dilutive ordinary shares. The company has the following

categories of potentially dilutive ordinary shares: Executive Share Awards (including Executive Share

Options and Executive Restricted Share Scheme Awards) and Employee Sharesave Scheme Options.

The options only dilute earnings when they result in the issue of shares at a value below the market price

of the share and when all performance criteria (if applicable) have been met as at the balance sheet

date. As at 31 December 2023, there were 15,150,221 (2022: 14,219,133) Executive Share Awards excluded

from the dilution because the exercise price for the options was greater than the average share price for

the year or the performance criteria have not been met.

	2023	2022
	average number	average number
	of shares	of shares
On a basic basis	716,700,954	715,284,629
Dilution for Executive Share Awards	1,368,088	1,858,996
Dilution for Employee Sharesave Scheme Options	214,492	350,982
On a diluted basis	718,283,534	717,494,607

Notes to the Financial Statements continued

7 Income Tax Expense continued

173 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

9 Goodwill and Other Intangible Assets

	Brands	Goodwill	Software	Other	Total
	£m	£m	£m	£m	£m
Cost
At 1 January 2022	13,448	10,212	547	266	24,473
Additions	–	–	77	4	81
Arising on business combinations	–	(2)	–	7	5
Disposals	(59)	(6)	(3)	–	(68)
Reclassifications	–	–	16	(16)	–
Exchange adjustments	1,136	832	16	17	2,001
At 31 December 2022	14,525	11,036	653	278	26,492
Additions	–	–	101	–	101
Arising on business combinations	–	17	–	39	56
Disposals	(1)	–	–	–	(1)
Reclassification from tangible fixed
assets	–	–	4	–	4
Reclassifications to held for sale	(124)	–	–	–	(124)
Exchange adjustments	(583)	(660)	(5)	(4)	(1,252)
At 31 December 2023	13,817	10,393	753	313	25,276
Accumulated amortisation and impairment
At 1 January 2022	342	4,884	252	127	5,605
Amortisation and impairment	21	167	68	19	275
Disposals	–	–	(1)	–	(1)
Reclassifications	–	–	8	(8)	–
Exchange adjustments	16	376	8	10	410
At 31 December 2022	379	5,427	335	148	6,289
Amortisation	20	–	79	8	107
Impairment	–	810	2	–	812
Disposals	(1)	–	–	–	(1)
Reclassifications to held for sale	(77)	–	–	–	(77)
Exchange adjustments	(10)	(422)	(4)	(6)	(442)
At 31 December 2023	311	5,815	412	150	6,688
Net book value
At 31 December 2022	14,146	5,609	318	130	20,203
At 31 December 2023	13,506	4,578	341	163	18,588

The amount stated for brands represents the fair value of brands acquired since 1985 at the date of

acquisition. Other includes product registration, distribution rights, capitalised product development

costs and customer contracts.

Software includes intangible assets under construction of £88 million (2022: £40 million).

The net book values of significant brand intangible assets acquired through business combinations are

as follows:

	Acquisition	2023	2022
Acquisition	year	£m	£m
Mead Johnson Nutrition Company	2017	4,480	4,740
SSL International	2010	1,847	1,918
Boots Healthcare International	2006	1,405	1,440
Adams Respiratory Therapeutics	2008	1,210	1,275
Schiff Nutrition International	2012	1,032	1,088
L&F Household	1994	834	877
Lanai Holdings	2021	644	680
American Home Products Corporation	1990	439	459
Bristol-Myers Squibb OTC	2013	362	338
K-Y	2014	280	280

The majority of brands, all of goodwill and certain other intangible assets are considered to have

indefinite lives (see Note 1) and therefore are subject to an annual impairment review. The MJN global

brand and acquired customer relationships are deemed to have a finite life and are amortised

accordingly. Amortisation is recognised in net operating expenses or cost of goods sold depending

on the use of the asset.

The net book values of indefinite and finite life intangible assets are as follows:

	2023	2022
Net book value	£m	£m
Indefinite life assets
Brands	13,415	14,034
Goodwill	4,578	5,609
Other	107	65
Total indefinite life assets	18,100	19,708
Finite life assets
Brands	91	112
Software	341	318
Other	56	65
Total finite life assets	488	495
Total net book value of intangible assets	18,588	20,203

Notes to the Financial Statements continued

174 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Cash Generating Units

Goodwill and other intangible assets with indefinite lives are allocated to either individual cash

generating units (CGUs), or groups of cash generating units (together GCGUs). The goodwill and

intangible assets with indefinite lives are tested for impairment at the level at which identifiable cash

inflows are largely independent. Generally, this is at a GCGU level, but for certain intangible assets this

is at a CGU level.

After considering all the evidence available, including how brand and production assets generate cash

inflows and how management monitors the business, the Directors have concluded that for the purpose

of impairment testing of goodwill and other intangible assets, the Group’s GCGUs are Health, Hygiene

and IFCN.

An analysis of the net book value of indefinite life assets and goodwill by GCGU/CGU is shown below:

		2023
	Indefinite
	life assets	Goodwill	Total
GCGU/CGU	£m	£m	£m
Health	7,258	3,849	11,107
Hygiene	1,844	45	1,889
IFCN	4,420	684	5,104
	13,522	4,578	18,100

1. Indefinite lived intangible assets and goodwill for VMS, and goodwill for Biofreeze, were transferred to the Health GCGU in 2023

		2022
	Indefinite
	life assets	Goodwill	Total
GCGU/CGU	£m	£m	£m
Health	5,779	3,556	9,335
Hygiene	1,924	45	1,969
IFCN	4,661	1,570	6,231
VMS	1,089	277	1,366
Biofreeze	646	161	807
	14,099	5,609	19,708

Within the Health GCGU, the cash flows associated with Intimate Wellness and Biofreeze brands are

separately identifiable. As a result, the carrying values of these indefinite life assets have been tested

for impairment as separate CGUs. This is in addition to the impairment testing performed over the

Health GCGU.

Indefinite life assets excluding goodwill

	2023	2022
	£m	£m
Intimate Wellness	2,143	2,213
Biofreeze	613	646

Annual Impairment Review

Goodwill and other indefinite life intangible assets must be tested for impairment on at least an annual

basis. An impairment loss is recognised when the recoverable amount of a GCGU or CGU falls materially

below its net book value at the date of testing.

The determination of recoverable amount, being the higher of value-in-use and fair value less costs to

dispose, is inherently judgemental and requires management to make multiple estimates, for example

around individual market pressures and forces, future price and volume growth, future margins, terminal

growth rates and discount rates.

When forecasting the annual cash flows that support the recoverable amount, the Group generally uses

its short-term budgets and medium-term strategic plans, with additional senior management and

Board-level review. Cash flows beyond the five-year period are projected using terminal growth rates.

These rates do not exceed the long-term average growth rate for the products and markets in which

the GCGU or CGU operates.

The cash flows are discounted back to their present value using a pre-tax discount rate considered

appropriate for each GCGU and CGU. These rates have been derived from management’s views

on the relevant weighted average cost of capital, subsequently converted to the pre-tax equivalent

discount rate.

For the Health and Hygiene GCGUs, and the Intimate Wellness and Biofreeze CGUs, as at 31 December

2023 any reasonably possible change in the key valuation assumptions would not imply possible

impairment. The recoverable amount for each of these GCGUs and CGU was determined utilising the

value-in-use basis (2022: value-in-use basis) with key assumptions including a pre-tax discount rate of

11% for Health, Hygiene and Intimate Wellness (2022: 9% for Health, Hygiene and Intimate Wellness with

10% for VMS), 11% for Biofreeze (2022: 12%) and a terminal growth rate of either 2.5% for Health, Intimate

Wellness and Biofreeze (2022: 2.5% for Health, Intimate Wellness, Biofreeze and VMS), or 2% for Hygiene

(2022: 2%).

IFCN

Since the disposal of the IFCN China business in September 2021, the IFCN CGU has represented the

Group’s remaining IFCN business principally in North America, Latin America and ASEAN. In impairment

assessments conducted in both 2021 and 2022, management determined that the recoverable amount

of IFCN was higher than its’ carrying value such that no impairment was required.

Notes to the Financial Statements continued

9 Goodwill and Other Intangible Assets continued

175 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

During 2023 the market environment for IFCN continued to be influenced by the infant formula supply

shortages in the US which resulted from the temporary closure of a major factory belonging to a

competitor. The infant formula supply shortages have resulted in an evolving regulatory environment,

which developed over the course of 2023. Compliance with enhanced regulatory requirements

is expected to increase the capital requirement for the IFCN business and to impact the cost of

manufacture in future periods.

As a result of these regulatory factors which developed over the course of 2023, and to incorporate the

effect of higher interest rates, management has increased the pre-tax discount rate used to determine

the value-in-use of the IFCN CGU.

This resulted in the IFCN net book value exceeding its recoverable amount, therefore management has

recorded an impairment loss against IFCN goodwill of £810 million to record the IFCN CGU at its

recoverable amount of £4,615 million.

The recoverable amount for IFCN has been calculated on a value-in-use basis (2022: value-in-use basis).

The value-in-use of IFCN was determined utilising a discounted cash flow approach with future cash

flows derived from a detailed five-year financial plan. Cash flows beyond the five-year plan are

projected using a terminal growth rate. The valuation used a pre-tax discount rate of 11% (2022: 9%)

and an IFCN specific terminal growth rate of 2.0% (2022: 2.0%).

The determination of the recoverable amount for IFCN at 31 December 2023 incorporates certain

assumptions, some of which are subject to considerable uncertainty. These assumptions include but are

not limited to the costs of complying with the evolving regulatory landscape, the level at which US

market shares stabilise, net revenue growth rates, the commercial success of new product launches and

the expansion of specialty nutrition. The value in use does not include any possible net cash outflows in

respect of current and future NEC litigation (note 20 and 33). As no headroom exists between the IFCN

recoverable amount and net book value, any changes to these assumptions (including relating to the NEC

litigation), or any deterioration in other macro or business-level assumptions supporting the IFCN

recoverable amount could necessitate the recognition of impairment losses in future periods.

The key assumptions used in the estimation of value-in-use of IFCN are outlined below.

	2023
Pre-tax discount rate	11%
Terminal growth rate	2.0%
Net revenue compound annual growth rate (CAGR) for the period 2023-2028	1.5%
Gross margin CAGR for the period 2023-2028	2.2%

1. The net revenue CAGR for the period 2024-2028 is circa 4%, following rebasing of Nutrition net revenue in 2024

The key estimates incorporated within the determination of the IFCN recoverable amount are

summarised below:

Key estimates Commentary

Market In the US, management expects birth rates to be relatively stable. Tendering

for WIC contracts continues to be highly competitive.

Within LATAM and ASEAN, management expects conditions to stabilise after

recent inflationary price increases.

Net Revenue In the short to medium term, the valuation model assumes a five-year CAGR

of 1.5%. This is expected to be achieved through ongoing premiumisation,

inflationary price increases and revenues from new products/category

launches including the expansion of speciality nutrition.

Margins In the short to medium term, the valuation model assumes IFCN margins

(both gross and operating) to increase over the medium term as IFCN drives

efficiencies and improved product mix.

Discount rate Management determined an IFCN-specific weighted average cost of capital

(WACC) and the implied pre-tax discount rate with the support of a third-party

expert. In addition, management performed benchmarking against other

comparable companies.

Terminal growth rate Management engaged a third-party expert to help calculate an IFCN-specific

terminal growth rate. Management is satisfied with the reasonableness of the

terminal growth rate when compared against independent market growth

projections and long-term country inflation rates.

The table below shows the sensitivity of the recoverable amount to reasonably possible changes in key

assumptions. The table assumes no related response by management (for example, to drive further cost

savings) and is hence theoretical in nature.

	2023
	£m
Expected Net Revenue growth rates (2024 to 2028) adjusted by 100bps	+410/-400
Expected EBIT growth rates (2024 to 2028) adjusted by 100bps	+/-260
Terminal growth rate (applied from 2029) adjusted by 50bps	+290/-250
Pre-tax discount rate adjusted by 50bps	+270/-240

Notes to the Financial Statements continued

9 Goodwill and Other Intangible Assets continued

176 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Biofreeze

On 12 July 2021, the Group acquired 100% of the equity interests in Lanai Holdings, owner of the Biofreeze

and TheraPearl brands, for cash consideration of $1,060 million (£766 million). Biofreeze is a leader in

over-the-counter topical pain relief, with a strong footprint in the North America retail and clinical

channels and a growing international presence.

During 2022, Biofreeze performed below expectations following a short-term category slowdown,

in part due to macroeconomic conditions. This underperformance, together with the macroeconomic

environment, introduced additional uncertainty into future Biofreeze cash flows. To reflect this

uncertainty, management increased the pre-tax discount rate used to determine value-in-use to 12.0%.

This resulted in the book value of the Biofreeze CGU exceeding its recoverable amount at 31 December

2022, therefore in 2022 management recorded a goodwill impairment of £152 million to record Biofreeze

at its recoverable amount of £698 million ($843 million). Following this impairment, at 31 December 2022

no headroom remained between the Biofreeze recoverable amount and net book value.

During the second half of 2023, the integration of Biofreeze into the Health business was completed.

Following this integration, Biofreeze goodwill is monitored at the Health GCGU level and Biofreeze

goodwill has accordingly been transferred to the Health GCGU. An impairment review of the Biofreeze

CGU inclusive of goodwill was performed immediately prior to the transfer of the goodwill, with this

review performed as at 30 September 2023. Biofreeze goodwill was deemed recoverable immediately

prior to transfer to the Health GCGU.

The recoverable amount for the Biofreeze CGU has been determined on a value-in-use basis using

a discounted cash flow approach, with future cash flows derived from a detailed five-year plan.

Cash flows beyond the five-year plan have been projected using a terminal growth rate of 2.5%.

The determination of the recoverable amount for Biofreeze in the 2023 impairment assessment

incorporates certain key assumptions, some of which are subject to considerable uncertainty.

These assumptions include but are not limited to anticipated market share improvement,

the commercial success of new product launches and international market expansion.

The key assumptions used in the estimation of value-in-use of Biofreeze at 30 September 2023 and

31 December 2022 are outlined below:

	30 September 2023
Pre-tax discount rate	11%
Terminal growth rate	2.5%
Net revenue compound annual growth rate (CAGR) for the period 2023-2028	11%
Gross margin CAGR for the period 2023-2028	12%

	31 December 2022
Pre-tax discount rate	12%
Terminal growth rate	2.5%
Net revenue compound annual growth rate (CAGR) for the period 2022-2027	11%
Gross margin CAGR for the period 2022-2027	14%

They key estimates incorporated within the determination of the Biofreeze recoverable amount

at 30 September 2023 and 31 December 2022 are summarised below:

Key estimates Commentary

Net Revenue In the short to medium term, the valuation model assumes a five-year CAGR

of 11% (2022: 11%), to be delivered through category growth and market share

growth driven by a mix of innovation arising from format expansion of existing

products and international expansion.

Margins In the short to medium term, the valuation model assumes Biofreeze margins

(both gross and operating) to increase from current levels as Biofreeze

benefits from productivity initiatives on integrating into Reckitt. In the year

ended 31 December 2022, there were temporary factors which negatively

impacted margins.

Discount rate Management determined the Biofreeze-specific weighted average cost

of capital (WACC) and the implied pre-tax discount rate with the support

of a third-party expert.

Terminal growth rate Management is satisfied with the reasonableness of the terminal growth

rate when compared against independent market growth projections and

long-term country inflation rates.

Notes to the Financial Statements continued

9 Goodwill and Other Intangible Assets continued

177 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The table below shows the percentage movement in the 2023 key assumptions that (individually)

would be required to reach the point at which the Biofreeze value in use approximates its carrying value.

	30 September 2023
Expected Net Revenue growth rates (2024-2028)	180bps decrease
Expected EBIT growth rates (2024-2028)	290bps decrease
Terminal growth rate	100bps decrease
Pre-tax discount rate	100bps increase

VMS

During the year to 31 December 2023 the integration of VMS into the Health GBU was completed,

and as a result the VMS indefinite lived intangible assets and goodwill were included in the Health

GCGU. Prior to integration an impairment review was performed. No separate impairment review for VMS

has therefore been performed at 31 December 2023. In the year to 31 December 2022 the recoverable

amount of the VMS CGU was determined utilising the value-in-use basis with key assumptions including

a pre-tax discount rate of 10%, and a terminal growth rate of 2.5%.

10 Property, Plant and Equipment

	Land and	Plant and	Right of	Assets under
	buildings	equipment	use assets	construction	Total
	£m	£m	£m	£m	£m
Cost
At 1 January 2022	1,220	2,073	461	408	4,162
Additions	26	80	137	256	499
Disposals	(19)	(75)	(58)	(6)	(158)
Reclassifications (including held for sale)	91	168	(1)	(293)	(35)
Exchange adjustments	91	122	41	29	283
At 31 December 2022	1,409	2,368	580	394	4,751
Additions	13	38	56	301	408
Disposals	(17)	(48)	(53)	(6)	(124)
Reclassifications (including held for sale)	92	231	11	(349)	(15)
Exchange adjustments	(34)	(59)	(27)	(11)	(131)
At 31 December 2023	1,463	2,530	567	329	4,889
Accumulated depreciation and impairment
At 1 January 2022	482	1,341	156	5	1,984
Charge for the year	62	184	83	–	329
Disposals	(12)	(66)	(45)	(4)	(127)
Impairment	–	1	–	2	3
Reclassifications (including held for sale)	(6)	(18)	(3)	–	(27)
Exchange adjustments	30	69	15	2	116
At 31 December 2022	556	1,511	206	5	2,278
Charge for the year	68	199	96	–	363
Disposals	(16)	(42)	(28)	–	(86)
Impairment	4	4	–	–	8
Reclassifications (including held for sale)	(1)	(3)	–	–	(4)
Exchange adjustments	(16)	(41)	(11)	(1)	(69)
At 31 December 2023	595	1,628	263	4	2,490
Net book value
As at 31 December 2022	853	857	374	389	2,473
As at 31 December 2023	868	902	304	325	2,399

Notes to the Financial Statements continued

9 Goodwill and Other Intangible Assets continued

178 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

At 31 December 2023, the Group’s right of use assets included land and buildings of £276 million

(2022: £350 million) and other assets of £28 million (2022: £24 million). The depreciation charged on

the right of use assets comprises £82 million (2022: £70 million) on the land and buildings and £14 million

(2022: £13 million) on the other assets.

At 31 December 2023, the Group has commitments to purchase property, plant and equipment

of £69 million (2022: £76 million).

11 Equity Instruments

			2023				2022
		Fair value	Fair value			Fair value	Fair value
		through	through other			through	through other
	Equity	profit or	comprehensive		Equity	profit or	comprehensive
	method	loss	income	Total	method	loss	income	Total
	£m	£m	£m	£m	£m	£m	£m	£m
Equity
investments	–	45	69	114	–	–	82	82
Investments in associates	4	–	–	4	4	–	–	4
	4	45	69	118	4	–	82	86

Equity investments at 31 December 2023 and 2022 is composed of a number of listed and unlisted equity

investments in which the Group has a minority stake.

In 2023, equity investments includes investments of £45 million principally in equity mutual funds which

are made in the name of the Group, but the proceeds of which are provided to employees as part of their

compensation arrangements. In 2022 these equity investments were previously included in non-current

receivables. The related liability is included in other non-current liabilities (Note 21) .

The Group also holds a number of individually immaterial investments in associates over which it

exercises a significant influence. In 2023, there are no impairments and gains or losses associated

with equity accounted investments are less than £1 million. In 2022, investments accounted for using

the equity method relate predominantly to the Group’s investment in Your.MD AS (trading as Healthily)

which was fully impaired. In 2022, the Group’s share of the result of Healthily amounted to a loss of

£2 million and the Group recognised an impairment charge of £19 million within the Group Income

Statement with respect to this investment.

12 Deferred Tax

Deferred tax

	Accelerated		Short-term		Retirement
	capital	Intangible	temporary		benefit
	allowances	assets	differences	Tax losses	obligations	Total
	£m	£m	£m	£m	£m	£m
At 1 January 2023	(54)	(3,274)	503	46	(14)	(2,793)
Credited/(charged) to the Income Statement	(10)	11	39	19	(7)	52
Credited/(charged) to other comprehensive income	–	–	(11)	–	16	5
Arising on business
combinations	–	–	(1)	–	–	(1)
Exchange differences	4	142	(19)	(1)	(1)	125
At 31 December 2023	(60)	(3,121)	511	64	(6)	(2,612)

	Accelerated		Short-term		Retirement
	capital	Intangible	temporary	Tax	benefit
	allowances	assets	differences	losses	obligations	Total
2023	£m	£m	£m	£m	£m	£m
Deferred tax assets	16	(38)	237	62	10	287
Deferred tax liabilities	(76)	(3,083)	274	2	(16)	(2,899)
Deferred tax	(60)	(3,121)	511	64	(6)	(2,612)

	Accelerated		Short-term		Retirement
	capital	Intangible	temporary	Tax	benefit
	allowances	assets	differences	losses	obligations	Total
Deferred tax	£m	£m	£m	£m	£m	£m
At 1 January 2022	(49)	(3,023)	442	27	(6)	(2,609)
Credited/(charged) to the Income Statement	2	1	16	15	(9)	25
Credited/(charged) to other comprehensive income	–	–	8	–	(5)	3
Exchange differences	(7)	(252)	37	4	6	(212)
At 31 December 2022	(54)	(3,274)	503	46	(14)	(2,793)

	Accelerated		Short-term		Retirement
	capital	Intangible	temporary		benefit
	allowances	assets	differences	Tax losses	obligations	Total
2022	£m	£m	£m	£m	£m	£m
Deferred tax assets	20	(36)	221	28	11	244
Deferred tax liabilities	(74)	(3,238)	282	18	(25)	(3,037)
Deferred tax	(54)	(3,274)	503	46	(14)	(2,793)

Notes to the Financial Statements continued

10 Property, Plant and Equipment continued

179 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Deferred tax assets and liabilities have been offset where they relate to income taxes levied by the same

taxation authority.

Unrecognised deferred tax assets

The Group has reviewed its treatment of unrecognised corporation tax losses subject to recapture and

will now disclose these amounts in the notes to the financial statements, resulting in the disclosure of

incremental losses totalling £1,889 million gross at 31 December 2023. The amount of unrecognised

corporation tax losses subject to recapture that were not included in the disclosure at 31 December 2022

was £1,736 million gross.

Deferred tax assets on certain corporation tax losses and other short term temporary differences

totalling £4,734 million gross (2022: £3,029 million gross) have not been recognised at 31 December 2023

as the likelihood of future economic benefit is not sufficiently assured. These assets will be recognised if

utilisation of the losses and other temporary differences become probable.

Unrecognised deferred tax liabilities

The aggregate amount of gross temporary differences associated with investments in subsidiaries,

branches and associates and interest in joint ventures, for which deferred tax liabilities have not been

recognised at 31 December 2023 is £7,833 million (2022: £7,630 million).

Deferred tax on short-term temporary differences of £511 million (2022: £503 million) are comprised of

accrued expenses deductible for tax on a cash basis of £404 million (2022: £418 million), other short–term

temporary differences of £140 million (2022: £143 million) and net of deferred tax liabilities on unremitted

earnings of £33 million (2022: £58 million).

13 Inventories

	2023	2022
	£m	£m
Raw materials and consumables	401	471
Work in progress	82	88
Finished goods and goods held for resale	1,154	1,266
Total inventories	1,637	1,825

The total cost of inventories recognised as an expense and included in cost of sales amounted to

£5,577 million (2022: £5,810 million). This includes inventory write-offs and losses of £111 million

(2022: £184 million).

The Group inventory provision at 31 December 2023 was £108 million (2022: £164 million).

14 Trade and Other Receivables

Amounts falling due within one year Note

		2023	2022
		£m	£m
Trade receivables		1,741	1,766
Less: Provision for impairment of receivables		(36)	(42)
Trade receivables – net		1,705	1,724
Other receivables	14b	266	264
Prepayments and accrued income		91	94
Trade and other receivables		2,062	2,082

The carrying amounts of the Group’s trade and other receivables are denominated in the

following currencies:

Currency analysis

	2023	2022
	£m	£m
US dollar	575	678
Euro	302	289
Sterling	173	165
Brazilian real	170	132
Other currencies	842	818
Trade and other receivables	2,062	2,082

The maximum exposure to credit risk at the year end is the carrying value of each class of receivable

mentioned above.

12 Deferred Tax continued

Notes to the Financial Statements continued

180 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

a. Trade receivables

Trade receivables consist of amounts due from customers. The Group’s customer base is large

and diverse and consequently there is limited concentration of credit risk. Credit risk is assessed

at a subsidiary and Group level and takes into account the financial positions of customers, past

experience, future expectations and other relevant factors. Individual credit limits are established

based on those factors.

The following table provides an ageing analysis of trade receivables at year end:

	2023	2022
	£m	£m
Not overdue	1,455	1,543
Up to 3 months overdue	250	157
Over 3 months overdue	36	66
Trade receivables	1,741	1,766

At 31 December 2023, a provision of £36 million (2022: £42 million) was recorded against certain trade

receivables based on a forward-looking assessment of the lifetime expected credit loss as required by

IFRS 9. This assessment considered the ageing profiles of specific trade receivable balances along with

the risk of future customer defaults.

As at 31 December 2023, trade receivables of £250 million (2022: £181 million) were past due but not

impaired. These receivables were not impaired because having considered their nature and historical

collection, recovery of the unprovided amounts is expected in due course.

b. Other receivables

Other receivables includes recoverable indirect tax of £187 million (2022: £191 million) .

Notes to the Financial Statements continued

c. Other non-current receivables

Other non-current receivables consists of:

	2023	2022
	£m	£m
Other receivables	72	73
Equity mutual funds (Note 11)	–	42
Prepayments	20	25
Non-current tax recoverable	30	17
Derivative financial instruments	50	–
Other non-current receivables	172	157

In 2023, the amount in relation to Equity mutual funds was reclassed from receivables to equity

instruments (Note 11)

d. Financial instruments (Note 15)

At 31 December 2023, £1,836 million (2022 restated

: £1,879 million) of the current and non-current

receivables totalling £2,234 million (2022: £2,239 million) are financial assets. These mainly related to

amounts owed from customers or government bodies and are typically non-interest bearing. Amounts

that are not financial assets are mostly prepayments, recoverable sales tax and employee benefit assets.

1. Restated to exclude £192 million of recoverable sales tax assets that were previously included within financial assets

14 Trade and Other Receivables continued

181 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

15 Financial Instruments and Financial Risk Management

Financial instruments by category

				At 31 December 2023					At 31 December 2022
					Fair value					Fair value
			Derivatives	Fair value through other				Derivatives	Fair value through other
		Amortised	used for	through	comprehensive	Carrying	Amortised	used for	through	comprehensive	Carrying
		cost	hedging	profit or loss	income	value total	cost	hedging	profit or loss	income	value total
	Note	£m	£m	£m	£m	£m	£m	£m	£m	£m	£m
Assets as per the Balance Sheet
Current and non-current trade and other receivables	14d	1,836	–	–	–	1,836	1,879	–	–	–	1,879
Derivative financial instruments
FX forward exchange contracts	17	–	48	16	–	64	–	34	25	–	59
Cross currency interest rate swaps	17	–	50	–	–	50	–	–	–	–	–
Equity instruments	11	–	–	45	69	114	–	–	–	82	82
Cash and cash equivalents	16	1,387	–	–	–	1,387	1,157	–	–	–	1,157
Liabilities as per the Balance Sheet
Current and non-current trade and other payables	21	5,276	–	–	–	5,276	5,344	–	–	–	5,344
Share repurchase liability	24	296	–	–	–	296	–	–	–	–	–
Borrowings (commercial paper, loans and overdrafts and other non-current borrowings)	17	43	–	–	–	43	1,252	–	–	–	1,252
Lease liabilities	19	327	–	–	–	327	389	–	–	–	389
Senior notes	17	1,292	–	–	–	1,292	1,369	–	–	–	1,369
Bonds	17	6,875	–	–	–	6,875	5,874	–	–	–	5,874
Derivative financial instruments
FX forward exchange contracts	17	–	20	58	–	78	–	22	34	–	56
Interest rate swaps	17	–	115	–	–	115	–	164	–	–	164
Cross currency interest rate swaps	17	–	72	–	–	72	–	84	–	–	84
1. Restated (see Note 14d)

The categories in this disclosure are determined by IFRS 9. Lease liabilities are outside the scope of IFRS 9, but they remain within the scope of IFRS 7, and therefore have been shown separately. In 2023 borrowings largely relate to bank loans and overdrafts

(2022: commercial paper). As at 31 December 2022, the Group had commercial paper in issue amounting to €841 million (nominal value) at rates between 0.92% and 2.74% with maturities ranging from 6 January 2023 to 30 June 2023, and $550 million (nominal value)

at rates between 4.55% and 4.95% with maturities ranging from 3 January 2023 to 23 March 2023.

The fair value measurement hierarchy levels have been defined as follows:

– Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1)

– Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (level 2). If all significant inputs required to fair

value an instrument are observable, the instrument is included in level 2

– Inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs) (level 3)

Notes to the Financial Statements continued

182 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The following table categorises the Group’s financial assets and liabilities held at fair value by the

valuation methodology applied in determining their fair value.

			At 31 December 2023				At 31 December 2022
	Level 1	Level 2	Level 3	Total	Level 1	Level 2	Level 3	Total
	£m	£m	£m	£m	£m	£m	£m	£m
Assets as per the Balance Sheet
Derivative financial instruments
FX forward exchange
contracts	–	64	–	64	–	59	–	59
Cross currency interest
rate swaps	–	50	–	50	–	–	–	–
Equity instruments	22	45	47	114	29	–	53	82
Liabilities as per the Balance Sheet
Derivative financial instruments
FX forward exchange
contracts	–	78	–	78	–	56	–	56
Interest rate swaps	–	115	–	115	–	164	–	164
Cross currency interest
rate swaps	–	72	–	72	–	84	–	84

The fair value of forward foreign exchange contracts was determined using forward exchange rates

derived from market sourced data at the Balance Sheet date, with the resulting value discounted back

to present value (level 2 classification). The fair value of the interest rate swap contracts and the cross

currency interest rate swaps was calculated using discounted future cash flows at floating market rates

(level 2 classification).

The fair value of equity instruments at 31 December 2023 and 31 December 2022 was determined using

quoted share price information (level 1 classification), other observable market data (level 2 classification)

and other non-market information (level 3 classification).

Except for the bonds and senior notes, the carrying values of other financial assets and liabilities held

at amortised cost approximate their fair values. The fair value of the bonds as at 31 December 2023 is

a liability of £6,788 million (2022: £5,612 million) and the fair value of the senior notes as at 31 December

2023 is a liability of £1,203 million (2022: £1,250 million). The fair value of the bonds and senior notes was

derived using quoted market rates in an active market (level 1 classification).

Offsetting financial assets and financial liabilities

The majority of the Group’s derivative agreements are entered into under International Swaps and

Derivatives Association (ISDA) master netting agreements. In certain circumstances – for example,

when a credit event such as a default occurs – all outstanding transactions under the agreement are

terminated, the termination value is assessed and only a single net amount is payable in settlement

of all transactions.

The ISDA agreements do not meet the criteria for offsetting in the statement of financial position. This is

because the Group does not currently have any legally enforceable right to offset recognised amounts,

because the right to offset is enforceable only on the occurrence of future events such as a default event.

The following table sets out the carrying amounts of recognised financial instruments that are subject to

the above agreements.

	Gross amounts of
	recognised financial	Related financial
	assets/liabilities in the	instruments that
	Balance Sheet	are not offset	Net amount
At 31 December 2023	£m	£m	£m
Financial assets
Derivative financial instruments	114	(39)	75
Financial liabilities
Derivative financial instruments	(265)	39	(226)

At 31 December 2022

	Gross amounts of
	recognised financial	Related financial
	assets/liabilities in the	instruments that
	Balance Sheet	are not offset	Net amount
	£m	£m	£m
Financial assets
Derivative financial instruments	59	(36)	23
Financial liabilities
Derivative financial instruments	(304)	36	(268)

Financial risk management

The Group’s multinational operations expose it to a variety of financial risks that include the effects of

changes in foreign currency exchange rates (foreign exchange risk), market prices, interest rates, credit

risks and liquidity. The Group has in place a risk management programme that uses foreign currency

financial instruments, including debt, and other instruments, to limit the impact of these risks on the

financial performance of the Group.

Notes to the Financial Statements continued

15 Financial Instruments and Financial Risk Management continued

183 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The Group’s financing and financial risk management activities are centralised into Group Treasury (GT)

to achieve benefits of scale and control. GT manages financial exposures of the Group centrally in a

manner consistent with underlying business risks. GT manages only those risks and flows generated

by the underlying commercial operations; speculative transactions are not undertaken.

The Board of Directors reviews and agrees policies, guidelines and authority levels for all areas of

Treasury activity and individually approves significant activities. The GT function is subject to periodic

independent reviews and audits, both internal and external.

1. Market risk

(a) Currency risk

The Group operates internationally and enters into transactions in many currencies and as such is

exposed to foreign exchange risk arising from various currency exposures. Foreign exchange risk

arises from future commercial transactions, recognised assets and liabilities and net investments

in foreign operations.

The Group’s policy is to align interest costs and operating profit of its major currencies in order to provide

some protection against the translation exposure on foreign currency profits after tax. The Group may

undertake borrowings and other hedging methods in the currencies of the countries where most of its

assets are located.

It is the Group’s policy to monitor and, where appropriate, hedge its foreign currency transaction

exposure. These transaction exposures arise mainly from foreign currency receipts and payments for

goods and services and from the remittances of foreign currency dividends and loans. Where the Group

enters into hedges and applies hedge accounting, hedges are documented and tested for effectiveness

on an ongoing basis with any ineffectiveness recorded in the Income Statement.

The local business units enter into forward foreign exchange contracts with GT to manage these

exposures where practical and allowed by local regulations. GT matches the Group exposures, and

hedges the position where possible, using spot and forward foreign currency exchange contracts.

The Group’s strategy is to minimise Income Statement volatility by monitoring foreign currency balances,

external financing, and external hedging arrangements. The Group’s hedging profile is regularly reviewed

to ensure it is appropriate and to mitigate these risks as far as possible.

The notional principal amount of the outstanding forward foreign exchange contracts at 31 December

2023 was £8,426 million receivable (2022: £5,395 million) and £8,440 million payable (2022: £5,376 million).

The Group held forward foreign exchange contracts designated as cash flow hedges primarily in Euro,

Sterling, US dollar, Canadian dollar, Australian dollar, Mexican peso and Turkish lira. The notional value of

the payable leg resulting from these financial instruments was as follows:

Cash flow hedge profile

	2023	2022
	£m	£m
Euro	434	343
Sterling	258	247
US dollar	227	218
Canadian dollar	110	96
Australian dollar	92	92
Mexican peso	78	74
Turkish lira	58	73
Other	392	394
	1,649	1,537

These forward foreign exchange contracts are mainly expected to mature over the period January 2024 to

December 2024 (2022: January 2023 to December 2023). Of the total amount, £12 million (2022: £20 million)

is due between January 2025 and January 2026 (2022: January 2024 and January 2026).

Cash flow hedging is applied with the economic relationship and expected effectiveness being assessed

at inception, with any ineffectiveness recognised in the Income Statement. The ineffective portion

recognised in the Income Statement arising from cash flow hedges is immaterial (2022: immaterial).

Gains and losses recognised in other comprehensive income and the hedging reserve on forward exchange

contracts in 2023 of £39 million loss, net of tax (2022: £2 million gain, net of tax) are recognised in the Income

Statement in the periods in which the hedged forecast transaction affects the Income Statement .

Notes to the Financial Statements continued

15 Financial Instruments and Financial Risk Management continued

184 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

At 31 December 2023, the Group had forward contracts used for cash flow hedging with total fair value

of £1 million liability (2022: £12 million asset). These contracts are denominated in a diverse range of

currency pairings, where a fluctuation of 5% in any one of the contract pairings, with all others remaining

constant, would have a maximum effect of £4 million (2022: £7 million) on shareholder equity, until the

point at which the contracts mature and the forecast transaction occurs. The four largest contract

pairings in order of nominal value were Euro/Polish zloty, US Dollar/Thai Baht, Euro/Australian Dollar

and Euro/Canadian Dollar.

Where the Group is exposed to currency risk on its borrowings, the Group seeks to minimise the impact

of foreign exchange on the Income Statement through placing debt within a net investment hedge

or using financial instruments.

During the year, the US dollar bond totalling $500 million (2022: $500 million) which was used as the

hedging instrument in a net investment hedge matured and was replaced by forward currency swap

contracts totalling $500 million as the hedging instruments in a net investment hedge.

At 31 December 2023, the Group had designated a 2030 Euro bond totalling €850 million (2022: Euro bond

totalling €850 million) and forward currency swap contracts totalling €1,479 million (2022: commercial

paper totalling €750 million) as the hedging instruments in a net investment hedge relationship. During

the year commercial paper of €750 million (2022: forward currency swap contracts of €750 million) were

also in a hedge relationship. During 2023, the commercial paper contracts matured and were replaced

with the forward currency swap contracts. Possible sources of ineffectiveness include any impairments

to the Group’s net investments in Euros. The hedges are documented and are assessed for effectiveness

on an ongoing basis.

The net gain or loss under these arrangements is recognised in other comprehensive income. The net

effect on other comprehensive income for the year ended 31 December 2023 was a £42 million gain

(2022: £115 million loss). If Sterling weakens by 5% against the US dollar and Euro, the maximum impact

on shareholders’ equity due to the net investment hedging on US dollar forward currency swap contracts

and Euro bond/forward currency swaps would be £20 million loss and £101 million loss respectively

(2022: £22 million loss and £75 million loss respectively).

In 2020, the Group issued a €850 million bond due in 2026. Concurrent with the issue of the bond, the

Group entered into a €850 million cross currency interest rate swap on similar terms to the 2026 bond

to mitigate foreign exchange currency risk, for which hedge accounting has been applied. Sources

of ineffectiveness on this hedge relationship will come from a difference in credit ratings between

the counterparties.

In 2023, the Group issued a €650 million bond due in 2028 and a €750 million bond due in 2033.

Concurrent with the issue of these bonds, the Group also entered into a cross currency interest rate

swap on similar terms to the 2028 bond and the 2033 bond, to mitigate foreign exchange currency risk,

for which hedge accounting has been applied. Sources of ineffectiveness on these hedge relationships

will come from a difference in credit ratings between the counterparties and modifications to the terms

of either hedged item or instrument. At 31 December 2023 no material ineffectiveness (2022: no material

ineffectiveness) has been recognised in the Income Statement. The interest rate element of the swap is

discussed in interest rate risk below.

The remaining major monetary financial instruments (liquid assets, receivables, interest and non-interest

bearing liabilities) are either denominated in the functional currency of the Group or the functional

currency of the local entity.

The gains and losses from fair value movements on derivatives held at fair value through profit or loss,

recognised in the Income Statement in 2023, was a £109 million loss (2022: £443 million gain). These

derivatives are used to hedge foreign exchange gains and losses on non-Sterling financing assets and

financing liabilities between the Group’s treasury company and fellow Group subsidiaries.

(b) Cost inflation risk

Due to the nature of its business the Group is exposed to commodity, freight and other inflation

risks. Short-term volatility in pricing of these products is mitigated through medium-term contracts,

inventories of key materials and financial hedging. Over the medium and long term, the Group mitigates

the impact of inflation through: implementing pricing and revenue growth management; identifying

productivity and efficiencies; and improving sales mix.

Notes to the Financial Statements continued

15 Financial Instruments and Financial Risk Management continued

185 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The Group has both interest-bearing and non-interest bearing assets and liabilities. The Group monitors

its interest income and expense rate exposure on a regular basis. The Group sets its desired level of fixed

and floating rate exposure as part of its interest risk management strategy. The mix of fixed and floating

exposure on interest-bearing assets or liabilities is managed by using a mixture of fixed and floating rate

deposits, borrowings and interest rate derivatives.

In 2020 the Group issued two €850 million bonds due in 2026 and 2030. In order to maintain a level

of floating rate debt in line with the Group’s interest management strategy the Group entered into

a €850 million cross currency interest rate swap on similar terms to the 2026 bond and an interest rate

swap on the coupon payments due on the 2030 bond. The accounting for the foreign exchange element

of the cross currency swap is described above. The interest rate element swaps the fixed coupon

payments on the bond for floating rate (the cross currency interest rate swap with reference to adjusted

reference rates following GBP LIBOR cessation, and the interest rate swap with reference to EURIBOR).

The interest rate swaps have been placed into a fair value hedge relationship with the related bonds.

During 2023, the Group entered into a £747 million nominal value floating-to-fixed interest rate swap

due in 2026 to reduce the level of exposure to floating interest rates. This interest rate swap has been

designated as a cash flow hedge against the payments made on the floating leg of the Group’s existing

cross-currency interest rate swap. Sources of ineffectiveness on this hedge relationship may come from

a difference in credit ratings between the counterparties and modifications to the terms of either the

hedged item or the hedging instrument. At 31 December 2023 no material ineffectiveness has been

included in the Income Statement.

In 2023 the Group issued a €650 million bond due in 2028 and a €750 million bond due in 2033. In order to

maintain a level of fixed or floating rate debt in line with the Group’s interest management strategy the

Group entered into €650 million of cross currency interest rate swaps on similar terms to the 2028 bond

and €750 million cross currency interest rate swaps on similar terms to the 2033 bond. The accounting for

the foreign exchange and interest rate element of the cross currency swaps have been described above.

On the €650 million bond due in 2028, the cross currency interest rate swaps the fixed Euro coupon

payments on the bond for fixed GBP payments. On the €750 million bond due in 2033, the cross currency

interest rate swap swaps the fixed coupon payments on the bond for a GBP floating rate (with reference

to SONIA) payments. The €650 million cross-currency interest rate swap has been placed into a cash flow

hedge relationship with the bond due in 2028, and the €750 million has been placed into a fair value

hedge relationship with the bond due in 2033.

Sources of ineffectiveness on these hedge relationships will come from a difference in credit ratings

between the counterparties and modifications to the terms of either the hedged item or the hedging

instrument. At 31 December 2023 no material ineffectiveness (2022: no material ineffectiveness)

has been recognised in the Income Statement.

Various scenarios are simulated taking into consideration refinancing, renewal of existing positions,

alternative financing and hedging. Based on these scenarios, the Group calculates the impact on the

Income Statement of a defined interest rate shift. For each simulation, the same interest rate shift is used

for all currencies, calculated on a full-year and pre-tax basis.

The scenarios are only run for liabilities that represent the major interest-bearing positions. Based on the

simulations performed, the impact on the Income Statement of a 50 basis-point shift in interest rates

would be a maximum increase of £11 million (2022: £13 million) or decrease of £11 million (2022: £13 million),

respectively for the liabilities covered. The simulation is done on a periodic basis to verify that the

maximum loss simulated is within the limit given by management. There is also an impact on the Income

Statement of a 50 basis-point shift of £4 million (2022: £nil) on an asset that is inherently linked to a liability

included above, resulting in a net impact of £7 million.

2. Credit risk

The Group has no significant concentrations of credit risk. Credit risk arises from cash and cash

equivalents, derivative financial instruments, deposits with banks and financial institutions, as well as

credit exposures to customers. The assessment of lifetime expected credit losses relating to trade and

other receivables is detailed in Note 14. Financial institution counterparties are subject to approval under

the Group’s counterparty risk policy and such approval is limited to financial institutions with a BBB rating

or above. The Group uses BBB and higher rated counterparties to manage risk and only uses sub-BBB

rated counterparties by exception. The amount of exposure to any individual counterparty is subject to

a limit defined within the counterparty risk policy, which is reassessed annually by the Board of Directors.

Derivative financial instruments are only traded with counterparties approved in accordance with the

approved policy. Derivative risk is measured using a risk weighting method.

Notes to the Financial Statements continued

15 Financial Instruments and Financial Risk Management continued

186 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The Group has counterparty risk from asset positions held with financial institutions. This is comprised

of short-term investments, cash and cash equivalents and derivative positions. For risk management

purposes the Group assesses the exposure to major financial institutions by looking at the deposits,

cash and cash equivalents and a percentage of the nominal amount of derivative contracts taking into

account the time to maturity and the nature of the product. The following table summarises the Group’s

assessment of its exposure. The financial institutions listed in the tables are not comparable year on year.

Counterparty

		2023
		Limit	Exposure
	Credit rating	£m	£m
Financial institution A	A+	250	151
Financial institution B	A	200	149
Financial institution C	A+	250	149
Financial institution D	A+	250	143
Financial institution E	A+	250	128
Financial institution F	A+	250	108
Financial institution G	A	200	106
Financial institution H	A+	250	106
Financial institution I	AAAm	200	100
Financial institution J	A	200	99

Counterparty

		2022
		Limit	Exposure
	Credit rating	£m	£m
Financial institution A	A+	250	187
Financial institution B	A+	250	179
Financial institution C	A+	250	162
Financial institution D	A+	250	145
Financial institution E	A	200	108
Financial institution F	A	200	100
Financial institution G	A+	250	87
Financial institution H	BBB+	125	83
Financial institution I	AA-	275	63
Financial institution J	A	200	59

3. Liquidity risk

Liquidity risk is the risk that the Group cannot repay financial liabilities as and when they fall due.

The Group’s liquidity risk is concentrated towards bond and senior note principal repayments due

between 2024 and 2044.

At the end of 2023, the Group had long-term debt excluding lease liabilities of £6,609 million

(2022: £6,852 million), of which £6,010 million (2022: £5,196 million) is repayable in more than two years.

In addition, the Group has committed borrowing facilities totalling £4,500 million (2022: £4,500 million),

of which £4,450 million (2022: £4,450 million) expires after more than two years. These facilities are

provided by high-quality international banks, are undrawn at year end and contain a financial covenant

which is not expected to restrict the Group’s future operations. The committed borrowing facilities,

together with central cash and investments, are considered sufficient to meet the Group’s projected

cash requirements.

All borrowing facilities are at floating rates of interest.

The facilities have been arranged to cover general corporate purposes, including support for commercial

paper issuance. All facilities incur commitment fees at market rates.

The Group’s borrowing limit at 31 December 2023 calculated in accordance with the Articles of

Association was £25,344 million (2022: £28,329 million).

The following table analyses the Group’s financial liabilities and derivatives into relevant maturity

groupings based on the remaining period at the Balance Sheet date to the contractual maturity date. The

amounts disclosed in the table are the contractual undiscounted cash flows which have been calculated

using spot rates and interest rates at the relevant Balance Sheet date, including interest to be paid.

		Less than	Between	Between	Over
	Total	1 year	1 and 2 years	2 and 5 years	5 years
At 31 December 2023	£m	£m	£m	£m	£m
Bonds	(7,983)	(1,731)	(138)	(3,586)	(2,528)
Senior notes	(1,858)	(56)	(645)	(96)	(1,061)
Trade and other payables	(5,276)	(5,208)	(68)	–	–
Share repurchase liability	(296)	(296)	–	–	–

		Less than	Between	Between	Over
	Total	1 year	1 and 2 years	2 and 5 years	5 years
At 31 December 2022	£m	£m	£m	£m	£m
Commercial paper	(1,200)	(1,200)	–	–	–
Bonds	(6,650)	(554)	(1,757)	(3,026)	(1,313)
Senior notes	(2,017)	(59)	(59)	(747)	(1,152)
Trade and other payables	(5,344)	(5,270)	(74)	–	–

Notes to the Financial Statements continued

15 Financial Instruments and Financial Risk Management continued

187 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The table below analyses the Group’s derivative financial instruments which will be settled on a gross

basis into relevant maturity groupings based on the remaining period between the Balance Sheet date

and the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted

cash flows which have been calculated using spot rates at the relevant Balance Sheet date.

	Less than	Between	Between	Over
	1 year	1 and 2 years	2 and 5 years	5 years
At 31 December 2023	£m	£m	£m	£m
FX forward exchange contracts
Outflow	(8,428)	(6)	(6)	–
Inflow	8,414	6	6	–
Cross currency interest rate swaps
Outflow	(116)	(116)	(1,534)	(824)
Inflow	48	48	1,440	776
Interest rate swaps
Outflow	(67)	(67)	(126)	(55)
Inflow	44	44	35	11

	Less than	Between	Between	Over
	1 year	1 and 2 years	2 and 5 years	5 years
At 31 December 2022	£m	£m	£m	£m
FX forward exchange contracts
Outflow	(5,356)	(7)	(13)	–
Inflow	5,376	7	12	–
Cross currency interest rate swaps
Outflow	(25)	(25)	(785)	–
Inflow	3	3	758	–
Interest rate swaps
Outflow	(21)	(21)	(63)	(53)
Inflow	6	6	17	17

Cash flow forecasting is performed by the local business units and on an aggregated basis by GT. GT

monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet

operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities.

Funds over and above those required for short-term working capital purposes by the local businesses are

generally remitted to GT. The Group uses the remittances to settle obligations, repay borrowings, or, in

the event of a surplus, invest in short-term instruments issued by institutions with a BBB rating or above.

4. Capital management

The Group considers capital to be net debt plus total equity. Net debt is calculated as total financing

liabilities less cash and cash equivalents and short-term deposits. Total equity includes share capital,

reserves and retained earnings as shown in the Group Balance Sheet.

Note

		2023	2022
		£m	£m
Cash and cash equivalents including overdrafts		1,380	1,156
Financing liabilities	17	(8,670)	(9,140)
Net debt		7,290	7,984
Total equity		8,469	9,483
		15,759	17,467

The objectives for managing capital are to safeguard the Group’s ability to continue as a going concern,

in order to provide returns for shareholders and benefits for other stakeholders and to maintain an

efficient capital structure to optimise the cost of capital.

In 2023, the Group provided returns to shareholders in the form of dividends and through buying back

shares. Refer to Note 24 for further details.

The Group monitors net debt which at year end was £7,290 million (2022: £7,984 million). In 2023 the

Group began a share buyback programme funded by surplus free cash flow (see Note 24) in line with

the Group’s capital allocation policy of returning surplus cash to shareholders.

Supply chain finance

The Group participates in a supply chain finance programme (SCF) under which certain suppliers to

the Group are able to access an SCF arrangement that enables them to fund their working capital. The

principal purpose of this programme is to facilitate efficient payment processing and enable the willing

suppliers to sell their receivables due from the Group to a bank before their due date. The Group does

not incur any additional interest towards the bank on the amounts due to the suppliers. As part of this

facility the Group has confirmed to certain financial institutions that it will make payments of £358 million

(2022: £330 million) to these suppliers as they fall due. These amounts are recorded within trade payables

on the Balance Sheet and all cash flows associated with the programme are included within operating

cash flows as they continue to be part of the normal operating cycle of the Group and their principal

nature remains operating, being payments for the purchase of goods and services .

Notes to the Financial Statements continued

15 Financial Instruments and Financial Risk Management continued

188 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

16 Cash and Cash Equivalents

	2023	2022
	£m	£m
Cash at bank and in hand	647	662
Short-term bank deposits	740	495
Cash and cash equivalents	1,387	1,157

The Group operates in a number of territories where there are either foreign currency exchange

restrictions, or where it is difficult for the Group to extract cash readily and easily in the short-term.

As a result, £229 million (2022: £276 million) of cash included in cash and cash equivalents is restricted

for use by the Group, yet available for use in the relevant subsidiary’s day-to-day operations.

17 Financial Liabilities – Borrowings

Note

		2023	2022
		£m	£m
Current
Bank loans and overdrafts		30	40
Commercial paper		–	1,190
Bonds		1,571	413
Lease liabilities	19	78	78
Total short-term borrowings		1,679	1,721
Non-current
Bonds		5,304	5,461
Senior notes		1,292	1,369
Other non-current borrowings		13	22
Lease liabilities	19	249	311
Total long-term borrowings		6,858	7,163
Total borrowings		8,537	8,884
Derivative financial instruments – as shown below Less overdrafts presented in cash and cash equivalents in the		140	257
Cash Flow Statement		(7)	(1)
Total financing liabilities		8,670	9,140

1. Bank loans are denominated in a number of currencies: all are unsecured and bear interest based on market short-term

interest rates

The Group uses derivative financial instruments to hedge certain elements of interest rate and exchange

risk on its financing liabilities. The split between these items and other derivatives on the Balance Sheet

is shown below:

		Assets		Liabilities
2023 (£m)	Current	Non-current	Current	Non-current
Derivative financial instruments (financing liabilities)	45	50	(58)	(177)
Derivative financial instruments
(non-financing liabilities)	19	–	(20)	(10)
At 31 December 2023	64	50	(78)	(187)

1. Included within other non-current receivables on the balance sheet

	Assets			Liabilities
2022 (£m)	Current	Non-current	Current	Non-current
Derivative financial instruments (financing liabilities)	25	–	(34)	(248)
Derivative financial instruments
(non-financing liabilities)	34	–	(21)	(1)
At 31 December 2022	59	–	(55)	(249)

Reconciliation of movement in financing liabilities to the Cash Flow Statement

	2023	2022
	£m	£m
At 1 January	9,140	9,637
Proceeds from borrowings	1,638	2,274
Repayment of borrowings	(1,855)	(3,807)
Other financing cash flows	(84)	383
Total financing cash flows	(301)	(1,150)
New lease liabilities	44	134
Exchange, fair value and other movements	(213)	519
Total non-cash financing items	(169)	653
At 31 December	8,670	9,140

Notes to the Financial Statements continued

189 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Maturity of borrowings (excluding lease liabilities)

	2023	2022
	£m	£m
Bank loans and overdrafts repayable:
Within one year or on demand	30	40
Other borrowings repayable:
Within one year:
Commercial paper	–	1,190
Bonds	1,571	413
After one year and in less than five years:
Bonds	3,205	4,381
Senior notes	599	636
After five years or longer:
Bonds	2,099	1,080
Senior notes	693	733
Other non-current borrowings	13	22
	8,180	8,455
Gross borrowings (unsecured)	8,210	8,495

18 Provisions for Liabilities and Charges

	Legal	Other	Total
	provisions	provisions	provisions
	£m	£m	£m
At 1 January 2022	180	55	235
Charged to the Income Statement	62	15	77
Utilised during the year	(8)	(3)	(11)
Released to the Income Statement	(17)	(12)	(29)
Reclassifications	(3)	5	2
Exchange adjustments	7	5	12
At 31 December 2022	221	65	286
Charged to the Income Statement	7	14	21
Utilised during the year	(63)	(1)	(64)
Released to the Income Statement	(17)	(11)	(28)
Reclassification	1	(2)	(1)
Exchange adjustments	(12)	(3)	(15)
At 31 December 2023	137	62	199

Provisions have been analysed between current and non-current as follows:

	2023	2022
	£m	£m
Current	142	227
Non-current	57	59
	199	286

Provisions are recognised when the Group has a present or constructive obligation as a result of past

events, it is more likely than not that there will be an outflow of resources to settle that obligation,

and the amount can be reliably estimated. As at 31 December 2023, the Group recognised legal

provisions of £137 million (2022: £221 million) in relation to a number of historical regulatory and other

matters in various jurisdictions.

These provisions relate to matters where the Group is currently involved with, or potentially will be

involved in, litigation. The provision represents the Group’s best estimate of the likely settlement. Due

to the uncertain nature of the resolution of the majority of these matters, £109 million (2022: £184 million)

is recorded as a current provision as it is possible the matters could be settled in the next 12 months;

however, it is possible that they may not be.

Other provisions include environmental obligations throughout the Group, the majority of which are

expected to be utilised within five years.

19 Lease Liabilities

Maturity analysis – contractual undiscounted cash flows

	2023	2022
	£m	£m
Within one year	81	80
Later than one and less than five years	199	253
After five years	103	135
Total undiscounted lease liabilities at 31 December	383	468
Lease liabilities included in the statement of financial position at 31 December	327	389
Current	78	78
Non-current	249	311

Interest charged on lease liabilities amounted to £14 million (2022: £16 million).

Notes to the Financial Statements continued

17 Financial Liabilities – Borrowings continued

190 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

20 Contingent Liabilities and Assets

Humidifier Sanitiser issue

The Humidifier Sanitiser (HS) issue in South Korea was a tragic event. The Group continues to make both

public and personal apologies to the victims who have suffered lung injury as a result of the Oxy HS

product and the role that the Oxy HS product played in the issue.

As previously reported, over the last several years the South Korean government has designated a

number of diseases as HS injuries, in addition to the HS lung injury for which Reckitt Korea’s compensation

plan was established. These include asthma, toxic hepatitis, child interstitial lung disease (ILD), bronchitis,

upper airway disease, pneumonia, skin disease (accompanied by respiratory injuries) and depression

(accompanied by respiratory injuries).

The Korean National Assembly passed a bill on 6 March 2020 to amend the HS law with the main changes

in the amendment relating to: (i) the definition of HS injury; (ii) the legal presumption of causation

(shifting the burden of proof for causation to the defendant if the plaintiff demonstrates ‘epidemiological

correlation’ between HS exposure and their injury), and (iii) amendments to the fund set up by the

government and funded by the government and HS companies (the Special Relief Fund (SRF), now called

the Injury Relief Fund (IRF)) to provide expanded support payments to HS victims which would cover

all elements of court awarded damages except mental distress, aside from KRW 100 million consolation

payments for death cases, and partial lost income.

The Group currently has a provision of £27 million (2022: £77 million) in relation to the HS issue in

South Korea. In addition, there are further potential costs that are not considered probable and cannot

be reliably estimated at the current time. The impact of the HS law amendments will require further

monitoring and analysis, in particular those which will be subject to court interpretation, such as the new

epidemiological correlation standard, any limitation applied by courts to damage awards, the interest

rate applied by individual courts to damage awards and external factors such as the rate of future IRF

applications/recognitions. Accordingly, it is not possible to make any reliable estimate of liability for

individuals recognised by the government as having HS injuries.

Necrotizing Enterocolitis (NEC)

Product liability actions relating to NEC have been filed against certain Group subsidiary companies, or

against Group subsidiary companies and Abbott Laboratories, in state and federal courts in the United

States. The actions allege injuries relating to NEC in preterm infants. Plaintiffs contend that human milk

fortifiers (HMF) and preterm formulas containing bovine-derived ingredients cause NEC, and that

preterm infants should receive a diet exclusively of breast milk. The Company has denied the material

allegations of the claims. It contends that its products provide critical tools to expert neonatologists for

the nutritional management of preterm infants for whom human milk, by itself, is not available or

nutritionally sufficient. The products are used under the supervision of medical doctors. Any potential

costs relating to these actions are not considered probable. Given the uncertainty on the number of

cases, their validity and range of possible outcomes on each valid case, the possible economic outflow

cannot be reliably estimated, but may be significant (see note 33).

Phenylephrine

Starting in September 2023, putative class action lawsuits have been filed against the Group and

competitor companies in various United States jurisdictions that generally allege that the defendants

made misrepresentations about the effectiveness of products containing phenylephrine. In December

2023, the Judicial Panel on Multidistrict Litigation (JPML) transferred all currently pending federal court

cases and any similar, subsequently filed cases to a coordinated multi-district litigation (MDL) in the

Eastern District of New York for pre-trial purposes. The Group is defending these cases, which all remain

in preliminary stages. Potential costs relating to these actions are not considered probable and cannot

be reliably estimated at the current time.

Other

From time to time, the Group is involved in discussions in relation to ongoing tax matters in a number

of jurisdictions around the world. Where appropriate, the Directors make provisions based on their

assessment of each case (see Note 7).

21 Trade and Other Payables

	2023	2022
	£m	£m
Trade payables	2,194	2,366
Other payables	118	123
Forward share purchase liability	158	–
Other tax and social security payable	163	172
Interest accrued on tax balances	122	105
Indemnity provisions for disposed businesses	48	–
Accruals	2,703	2,781
Trade and other payables	5,506	5,547

1. During the year, the £167 million (Note 30) recognised through equity has been re-estimated to £158 million at 31 December

2023, resulting in a £9 million credit to other finance income

Included within accruals is £1,125 million (2022: £1,137 million) in respect of amounts payable to trade

customers and government bodies for trade spend.

Other non-current liabilities

	2023	2022
	£m	£m
US employee-related payables	45	42
Indemnity provisions for disposed businesses	–	51
Other	22	23
Other non-current liabilities	67	116

Notes to the Financial Statements continued

191 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Financial instruments (Note 15)

At 31 December 2023, £5,276 million (2022: £5,344 million) of the current and non-current trade and

other payables totalling £5,573 million (2022: £5,663 million) are financial liabilities. These mainly relate

to amounts owed to suppliers in respect of goods or services and are typically non-interest bearing.

Amounts that are not financial instruments comprise employee-related liabilities, social security liabilities

and accrued interest.

22 Current and Non-current Tax Liabilities

	2023	2022
	£m	£m
Current tax liabilities	620	791
Non-current tax liabilities	28	54
Total current and non-current tax liabilities	648	845

Certain tax positions taken by us are based on industry practice, tax advice and drawing similarities

from our facts and circumstances to those in case law. In particular, international transfer pricing is an

area of taxation that depends heavily on the underlying facts and circumstances and generally involves

a significant degree of judgement.

Tax assets and liabilities are offset where there is a legally enforceable right to do so. Included within

current tax liabilities is an amount of £619 million (2022: £722 million) relating to uncertain tax positions

primarily in respect of transfer pricing. Within this, £187 million (2022: £194 million) relates to amounts

recognised using the most likely outcome method, where the resolution of the uncertainty is concentrated

on one binary outcome. There is no individual tax uncertainty calculated with this method that is material

to the Financial Statements.

Also within uncertain tax positions is an amount of £432 million (2022: £528 million) recognised using

the expected value method. The liabilities calculated using this method are not material in isolation,

are individually assessed and cover multiple jurisdictions and issues. Therefore, it is not meaningful to

provide aggregated sensitivity estimates. The sources of estimation uncertainty underlying this amount

are shown in Note 1.

The recognition of uncertain tax positions is reviewed regularly for changes in circumstances and

estimates are updated as potential resolutions for the tax uncertainties are encountered through specific

audits or wider case law. As a result, given the size, possible range of outcomes and timing of resolution,

there is a significant risk of material adjustment to the aggregate carrying amount of these liabilities

within the next financial year.

The disputes underlying the liability recognised in respect of uncertain tax positions may take

several years to resolve (see Note 1). Notwithstanding this, the carrying amount of £619 million

(2022: £722 million) has been presented as a current liability. The associated interest accrued on

uncertain tax positions of £122 million (2022: £105 million) also is presented as a current liability.

23 Pension and Post-Retirement Commitments

Plan details

The Group operates a number of defined benefit and defined contribution pension plans around the

world covering many of its employees, which are principally funded. The Group’s most significant pension

plan (UK) is set up under Trust and is a separate entity from the Group. It has two sections, a defined

contribution section which remains open and a defined benefits section, which closed to accrual from

31 December 2017. Members have a normal retirement age of 65. Trustees of the plan are appointed by

the Group, active members and pensioner membership, and are responsible for the governance of the

plan, including paying all administrative costs of the defined benefit section and compliance with

regulations. The defined benefit section of the plan is funded by the payment of contributions as

required, following each Triennial Valuation.

For the principal UK plan, a full independent actuarial valuation is carried out on a triennial basis.

The most recent valuation was carried out as at 5 April 2022 and as the plan was in surplus on its

technical provisions funding basis, no contributions are required to be paid by the Group in 2024

(2023: £nil). Funding levels are monitored on an annual basis.

The Group continues to monitor the impact of UK High Court rulings clarifying the requirements to

equalise the Guaranteed Minimum Pension element of benefits for men and women within the UK

Pension schemes from Guaranteed Minimum Pension accrued from post 17 May 1990 pensionable

service. A method has been agreed with the pension trustees from all defined benefit schemes

in the UK and no benefit changes or back payments have yet been made to members.

The Group also operates a number of other post-retirement plans in certain countries. The two

major plans are the US Retiree Health Care Plan and the Mead Johnson & Company, LLC Medical Plan

(together, the US (Medical) plans). In the US Retiree Health Care Plan, salaried participants become

eligible for retiree healthcare benefits after they reach a combined ‘age and years of service rendered’

figure of 70, although the age must be a minimum of 55. This plan closed to new members in 2009. In the

Mead Johnson & Company, LLC Medical Plan, acquired as part of the acquisition of MJN on 15 June 2017,

participants become eligible for retiree healthcare benefits if they leave employment after the age of 65,

leave after the age of 55 and have completed 10 years of service, or have their employment involuntarily

terminated after the age of 55. A Benefits Committee is appointed by the Group for both of these plans,

responsible for the governance of the US plans, including paying all administrative costs and compliance

with regulations. Both of these plans are unfunded.

Notes to the Financial Statements continued

21 Trade and Other Payables continued

192 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

For the US (Medical) plans, a full independent actuarial valuation is carried out on an annual basis.

The most recent valuation was carried out on 1 January 2024. For both of these plans, funding levels

are monitored on an annual basis with contributions made equal to the claims made each year.

It is expected that the combined contributions in 2024 will be £8 million (2023: £7 million).

For the purpose of IAS 19, the projected unit valuation method was used for the UK and US plans,

as per the principal UK plan triennial valuation results (at 5 April 2022) and the US (Medical) plan annual

valuations to 31 December 2023. The UK plans have a weighted average duration of the deferred benefit

obligation of 12.4 years (2022: 13.5 years). This decrease is predominantly driven by significant rises

in bond yields over the year to 31 December 2023.

Significant actuarial assumptions

The significant actuarial assumptions used in determining the Group’s net liability for the UK and US

(Medical) plans as at 31 December were:

	2023		2022
	UK	US (Medical)	UK	US (Medical)
	%	%	%	%
Rate of increase in pensionable salaries	N/A	–	N/A	–
Rate of increase in deferred pensions during deferment	2.8	–	3.4	–
Rate of increase in pension payments	3.05	–	3.25	–
Discount rate	4.7	4.9	5.0	5.2
Inflation assumption – RPI	3.2	–	3.4	–
Annual medical cost inflation	–	5.0-8.0	–	5.0-8.0

Assumptions regarding future mortality experience are set in accordance with published statistics and

experience in each territory. The expected lifetime of a participant aged 60 and the expected lifetime

of a participant who will be aged 60 in 15 years (20 years in the US) are detailed below:

	2023		2022
	UK years	US years	UK years	US years
Number of years a current pensioner
is expected to live beyond 60:
Male	27.2	25.3	27.5	25.2
Female	28.8	27.4	29.0	27.3
Number of years a future pensioner
is expected to live beyond 60:
Male	28.4	27.0	28.8	26.9
Female	30.0	28.9	30.4	28.9

For the principal UK plan, the mortality assumptions were based on the standard SAPS mortality table

3NMA for males (scaled by 98%) and table 3NFA for females (scaled by 117%). Allowance for future

changes is made by adopting the 2022 edition of the CMI series with a long-term improvement trend of

1.5% per annum from 2013 onwards. Allowance is made for future improvements in mortality by adopting

the CMI’s published 2022 improvement tables with a long-term improvement trend of 1.5% per annum

from 2013 onwards, an initial addition to mortality improvements of 0.25% pa, the core period smoothing

parameter of 7.0 and a default weighting of 0% / 0% / 25% applied to 2020 / 2021 / 2022 calendar year

data. For the US plan the mortality assumptions were determined using the Pri-2012 Total Dataset and

projected with Mortality Improvement Scale MP-2021.

While COVID-19 has had an impact on mortality in the year ended 31 December 2022 and 2023, the

long-term impact on future mortality trends is currently unknown and consequently no adjustment

has been made to mortality assumptions in this regard, beyond adjusting the weighting in the mortality

tables described above.

Amounts recognised on the Balance Sheet

The amounts recognised on the Balance Sheet are as follows:

	2023	2022
	£m	£m
Balance Sheet liability for:
US (Medical)	(73)	(81)
Other	(160)	(159)
Liability on Balance Sheet	(233)	(240)
Balance Sheet assets for:
UK	206	241
Other	64	53
Asset on Balance Sheet	270	294
Net pension asset	37	54

The UK surplus of £206 million (2022: £241 million) relates mainly to the Reckitt Benckiser Pension Fund.

This surplus has been recognised as the Group has concluded it has an unconditional right to a refund of

any surplus once all member benefits have been paid. The Group’s judgement is based on legal advice

that the Trustees would be unable to unconditionally wind up the plan or enhance members’ benefits

without the Group’s consent.

Notes to the Financial Statements continued

23 Pension and Post-Retirement Commitments continued

193 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The funded and unfunded amounts recognised on the Balance Sheet are determined as follows:

		2023				2022
		US				US
	UK	(Medical)	Other	Total	UK	(Medical)	Other	Total
	£m	£m	£m	£m	£m	£m	£m	£m
Present value of funded
obligations	(969)	–	(400)	(1,369)	(941)	–	(373)	(1,314)
Fair value of plan assets	1,178	–	443	1,621	1,186	–	426	1,612
Surplus of funded plans	209	–	43	252	245	–	53	298
Present value of unfunded
obligations	–	(73)	(139)	(212)	–	(81)	(159)	(240)
Irrecoverable surplus	(3)	–	–	(3)	(4)	–	–	(4)
Net pension surplus/
(liability)	206	(73)	(96)	37	241	(81)	(106)	54

Group plan assets are comprised as follows:

		2023				2022
		US				US
	UK	(Medical)	Other	Total	UK	(Medical)	Other	Total
	£m	£m	£m	£m	£m	£m	£m	£m
Equities	60	–	99	159	134	–	92	226
Government bonds	136	–	108	244	167	–	157	324
Corporate bonds	290	–	150	440	265	–	135	400
Real estate/property –
unquoted	28	–	11	39	82	–	19	101
Insurance contracts	273	–	–	273	272	–	–	272
Other assets – unquoted	391	–	75	466	266	–	23	289
Fair value of plan assets	1,178	–	443	1,621	1,186	–	426	1,612

Notes to the Financial Statements continued

23 Pension and Post-Retirement Commitments continued In 2021 and 2020, the Trustees of three of the UK pension plans entered into annuity buy-in agreements

which cover, in aggregate, £273 million of pension liabilities valued under IAS 19 at 31 December 2023

(£272 million of pension liabilities valued under IAS 19 at 31 December 2022). The agreements involved

the purchase of bulk annuity policies under which the insurer will pay the UK pension funds amounts

equivalent to the benefits payable to members. These purchases were conducted by the trustees to

ensure the pension fund had an asset that would match its obligation to members. The policies are

valued in accordance with IAS 19 by the plans’ actuary such that the fair value on the annuity policies is

deemed to be the present value of the related obligation measured using the assumptions underpinning

the valuation of the defined benefit obligation. The pension liabilities remain with, and the matching

annuity policies are held within, the UK pension funds. As this was an investment decision by the trustees,

the immaterial reduction in the valuation of plan assets (due to the difference between the purchase

price of the annuity policy and the accounting value of the buy-in asset) arising on each buy-in was

recorded within other comprehensive income. The Trustees have not entered any such buy-in

agreements in 2022 or 2023.

At 31 December 2023 the Group has not committed to any buy-out arrangements in respect of any

of the UK pension schemes.

Included in other assets are £319 million (2022: £235 million) relating to liability driven investment funds.

This is a bespoke pooled investment vehicle with underlying listed bonds, equities and structured notes.

The fair value of the vehicle is provided by the fund manager based on the underlying value of the

securities held within the vehicle. The trustees purchased these investments in 2021 to lower risk within

the portfolio without reducing potential returns. These investments have a low leverage percentage and

sufficient capital collateral in place. The remaining other assets are cash.

The present value of obligations for the combined UK plans and the US (Medical) plans at last valuation

date is attributable to participants as follows:

	2023		2022
	UK	US (Medical)	UK	US (Medical)
	£m	£m	£m	£m
Active participants	(1)	(19)	(1)	(34)
Participants with deferred benefits	(334)	(1)	(307)	(1)
Participants receiving benefits	(634)	(53)	(633)	(46)
Present value of obligation	(969)	(73)	(941)	(81)

194 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The movement in the Group’s net surplus/(deficit) is as follows:

		Present value of obligation					Fair value of plan assets
	UK	US (Medical)	Other	Total	UK	US (Medical)	Other	Total
	£m	£m	£m	£m	£m	£m	£m	£m
At 1 January 2022	1,486	107	650	2,243	(1,788)	–	(496)	(2,284)
Current service cost	–	1	8	9	–	–	–	–
Administrative costs	3	–	–	3	–	–	–	–
Interest expense/(income)	27	4	12	43	(34)	–	(14)	(48)
	30	5	20	55	(34)	–	(14)	(48)
Remeasurements:
Return on plan assets, excluding amounts included in interest income	–	–	–	–	565	–	96	661
(Gains) from changes in demographic assumptions	(2)	(11)	–	(13)	–	–	–	–
(Gains) from change in financial assumptions	(518)	(22)	(151)	(691)	–	–	(2)	(2)
Experience (gains)/losses	16	(3)	3	16	–	–	–	–
	(504)	(36)	(148)	(688)	565	–	94	659
Exchange differences	–	12	54	66	–	–	(41)	(41)
Contributions – employers	–	–	–	–	–	(7)	(13)	(20)
Benefit payments	(71)	(7)	(44)	(122)	71	7	44	122
As at 31 December 2022	941	81	532	1,554	(1,186)	–	(426)	(1,612)
Current service cost	–	–	10	10	–	–	–	–
Administrative costs	3	–	3	6	–	–	–	–
Interest expense/(income)	47	4	12	63	(58)	–	(13)	(71)
	50	4	25	79	(58)	–	(13)	(71)
Remeasurements:
Return on plan assets, excluding amounts included in interest income	–	–	–	–	5	–	10	15
(Gains) from changes in demographic assumptions	(16)	–	(1)	(17)	–	–	–	–
Losses from change in financial assumptions	34	2	(15)	21	–	–	–	–
Experience (gains)/losses	21	(5)	7	23	–	–	–	–
	39	(3)	(9)	27	5	–	10	15
Exchange differences	–	(4)	(20)	(24)	–	–	20	20
Contributions – employers	–	–	–	–	–	(5)	(23)	(28)
Benefit payments	(61)	(5)	(26)	(92)	61	5	26	92
Scheme assets and obligations previously presented net	–	–	37	37	–	–	(37)	(37)
As at 31 December 2023	969	73	539	1,581	(1,178)	–	(443)	(1,621)

1. During the year, the Group identified one country where the pension assets and obligation was presented net, the presentation has been corrected to show gross presentation

Notes to the Financial Statements continued

23 Pension and Post-Retirement Commitments continued

195 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Amounts recognised in the Income Statement

The charge for the year ended 31 December is shown below:

	2023	2022
	£m	£m
Defined contribution plans	44	49
Defined benefit plans (net charge excluding interest)
UK	3	3
US (Medical)	–	1
Other	13	8
Total pension costs included in operating profit (Note 5)	60	61
Pension net finance income included in net finance expense (Note 6)	(8)	(5)
Income Statement charge included in profit before income tax	52	56
Remeasurement gains/(losses) for 2 :
UK	(44)	(61)
US (Medical)	3	36
Other	(1)	54
	(42)	29

1. The Income Statement charge recognised in operating profit includes current service cost, past service cost and

administrative costs

2. Remeasurement gains excludes £1 million (2022: £nil) recognised in OCI for irrecoverable surplus

Sensitivity of significant actuarial assumptions

The sensitivity of the UK defined benefit obligation to changes in the principal assumptions is shown below:

		Change in defined
2023	Change in assumption	benefit obligation
Discount rate	Increase 0.1%	Decrease by 1.2%
Discount rate	Increase 1.0%	Decrease by 10.7%
RPI increase	Increase 0.1%	Decrease by 1.0%
RPI increase	Increase 1.0%	Increase by 8.9%
Life expectancy	Members live 1 year longer	Increase by 3.3%

		Change in defined
2022	Change in assumption	benefit obligation
Discount rate	Increase 0.1%	Decrease by 1.3%
Discount rate	Increase 1.0%	Decrease by 11.5%
RPI increase	Increase 0.1%	Increase by 0.7%
RPI increase	Increase 1.0%	Increase by 9.2%
Life expectancy	Members live 1 year longer	Increase by 3.2%

The above sensitivity analyses are based on a change in an assumption while holding all other

assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions

may be correlated.

Impact of medical cost trend rates

A 1% change in the assumed healthcare cost trend rates would have an immaterial impact on the service

cost, interest cost and post-retirement benefit obligation.

Risk and risk management

Through its defined benefit pension plans and post-employment medical plans, the Group is exposed

to a number of risks, the most significant of which are detailed as follows:

Asset volatility: The plan liabilities are calculated using a discount rate set with reference to corporate

bond yields. If plan assets underperform this yield, this will create a deficit/reduce the surplus. The US

plans hold a significant proportion of equities, which are expected to outperform corporate bonds in

the long term while providing volatility and risk in the short-term. However, the Group believes that

due to the long-term nature of the plan liabilities and the strength of the supporting group, a level of

continuing equity investment is an appropriate element of the Group’s long-term strategy to manage

the plans efficiently .

Notes to the Financial Statements continued

23 Pension and Post-Retirement Commitments continued

196 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Changes in bond yields: An increase in government and corporate bond yields will decrease plan

liabilities, although this will be partially offset by a decrease in the value of the plans’ bond holdings.

For example, following the increase in market bond yields in the year ended 31 December 2022, the UK

plans’ liabilities reduced by £545 million, offset by a reduction in the plans’ bond holdings by £602 million,

resulting in a £57 million net decrease to the plans’ surplus.

Inflation risk: Some of the Group’s pension obligations are linked to inflation, and higher inflation will

lead to higher liabilities (although, in most cases, caps on the level of inflationary increases are in place

to protect the plan against extreme inflation). In order to manage inflationary risks, the Trustees’

investment strategy within the UK plan provides a high level of protection against higher expected

long-term inflation through investments in index-linked gilts, liability driven investments and insurance

contracts. In the US plans, the pensions in payment are not linked to inflation, so this is a less material risk.

Life expectancy: The majority of the plans’ obligations are to provide benefits for the life of the member.

Whilst the plans allow for an increase in life expectancy, increases above this assumption will result in an

increase in the plans’ liabilities. This is particularly significant in the UK plan, where inflationary increases

to benefits result in higher sensitivity to improvements in life expectancy. In 2020 the principal UK

scheme reduced its exposure by purchasing an insurance product that will pay the pensions of some

of the plan’s pensioners. In 2021 two other UK pension schemes purchased a similar insurance policy

covering 100% of their members’ benefits.

Change in regulations: The Group is aware that future changes to the regulatory framework may impact

the funding basis of the various plans in the future. The Group’s pensions department monitors the

changes in legislation and analyses the risks as and when they occur.

Investments are well diversified, such that the failure of any single investment would not have a material

impact on the overall level of assets. A portion of assets consists of unit linked insurance policies with

underlying investments in quoted equities and quoted bonds, although the Group also invests in property

and cash. The Group believes that quoted equities offer the best returns over the long term with an

acceptable level of risk. The Trustees of all the UK funds have moved the majority of their assets to

low-cost investment funds in consultation with the Group whilst maintaining prudent diversification and

appropriate interest and inflation hedging. The Trustees and the Group have aligned goals in respect of

climate risk which includes a 50% reduction in carbon footprint ambition by 2030.

24 Share Capital

		Nominal
	Equity ordinary	value
Issued and fully paid	shares number	£m
At 31 December 2022	736,535,179	74
At 31 December 2023	736,535,179	74

The holders of ordinary shares (par value 10 pence) are entitled to receive dividends (Note 28) as

declared from time to time and are entitled to one vote per share at meetings of the parent company.

Repurchase of ordinary shares

In October 2023, the Group announced a share buyback programme of an initial amount of £1 billion to be

effected over 12 months. During 2023, as part of this share buyback programme, the Group entered into

commitments to purchase £500 million of ordinary shares.

A share repurchase liability of £296 million has been recognised in the balance sheet as at 31 December 2023

(2022: £nil), reflecting contractual obligations to purchase ordinary shares (including associated costs).

During the year to 31 December 2023, 3,782,835 shares have been purchased at a total cost of

£207 million. Repurchased ordinary shares have been included in the treasury shares (see below).

Allotment of ordinary shares and release of treasury shares

During the year nil ordinary shares (2022: nil ordinary shares) were allotted, 2,047,518 ordinary shares

were released from Treasury (2022: 1,351,767) and 3,782,835 ordinary shares (2022: nil ordinary shares)

were bought back, to satisfy vesting/exercises under the Group’s various share schemes as follows:

Ordinary shares of 10p

			2023		2022
	Number of		Consideration	Number of	Consideration
	shares		£m	shares	£m
Released from Treasury
Executive Share Options – exercises	380,348		19	372,711	18
Restricted Shares Awards – vesting	1,037,96	0	–	313,293	–
Total under Executive Share Option
and Conditional Award Schemes		1,418,308	19	686,004	18
Savings-related Share Option Schemes
–exercises		629,210	29	665,763	36
Total released from Treasury		2,047,518	48	1,351,767	54
Bought into Treasury
Repurchase of shares		(3,782,835)	(207)	–	–
Total		(1,735,317)	(159)	1,351,767	54

Notes to the Financial Statements continued

23 Pension and Post-Retirement Commitments continued

197 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

In 2023, 2,047,518 Treasury shares were released (2022: 1,351,767) and 3,782,835 ordinary shares

(2022: nil ordinary shares) were bought back, leaving a balance held at 31 December 2023 of 22,506,530

(2022: 20,771,213). Proceeds received from the reissuance of Treasury shares to exercise share options

were £48 million (2022: £54 million).

25 Share-Based Payments

The Group operates a number of incentive schemes, including a Long-Term Incentive Plan (LTIP), and

various other share schemes. All schemes are equity-settled. The total charge for share-based payments

for the year was £102 million (2022: £78 million).

Executive share awards

Executive share awards granted to the senior management team under the LTIP consist of Performance

Share Options, Performance Shares, and Time-Vested Shares. For Performance Share Options and

Performance Shares, vesting is conditional on achievement of specified performance targets over

a three-year period as well as continued employment. For Time-Vested Shares, vesting is conditional

only on three years of continued employment. For Performance Share Options, the exercise price is

determined on the grant date and becomes payable on exercise, which may be up to seven years after

the options have vested. Performance Shares and Time-Vested Shares entitle the recipient to receive

shares at no cost following satisfaction of the vesting conditions.

The performance metrics and associated weightings for the 2022 and 2023 LTIP awards are as follows:

LTIP performance metrics – 2022 and 2023 awards	Weighting
Like-for-like Net Revenue growth	40%
Return on Capital Employed (ROCE)	25%
Relative Total Shareholder Return (TSR)	25%
ESG	10%

LTIP awards with a market-based TSR performance condition were first granted in 2022. For LTIP awards

granted before 2022, LTIP awards included only non-market-based performance conditions.

For the Executive Committee and members of the Group Leadership Team, vesting conditions must be

met over the three-year performance period and are not retested. For awards granted to other members

of the senior management team before 2021, the targets can be retested in years four or five of the

scheme. If any target has not been met, any remaining shares or options which have not vested will

lapse. For awards granted in May 2021 and thereafter, vesting conditions must be met over the three-

year period and are not retested.

Other share awards

Other share awards include savings-related share options (offered to all staff within the relevant

geographic area) and a number of Senior Executive Share Ownership Policy Plan (SOPP) awards.

Other share awards have contractual lives of between three and eight years and are generally not

subject to any vesting conditions other than the employee’s continued employment.

Individual tranches of these other share awards are not material for detailed disclosure and therefore

information about these awards is presented only on an aggregated basis.

Valuation of share awards

The fair value of share options granted is calculated using a Black-Scholes model. Performance Share

Options and Performance Shares which include the market-based TSR performance target are valued

by a third-party expert using a Monte Carlo model. For Performance Shares with non-market-based

performance conditions and for Time-Vested Shares, the fair value is the share price on the date of

grant. From 2022 onwards, no adjustment to the market price at grant is required because all new

Performance Shares and Time-Vested Shares accrue dividend equivalents. Performance Options do

not accrue dividend equivalents.

The weighted average fair value of the LTIP Performance Share Options granted in the year and the key

assumptions made in arriving at that fair value were as follows:

		Performance Share Options
	2023	2022
Exercise price	£58.28	£63.32
Performance period	2023-25	2022-24
Share price on grant date	£59.18	£62.42
Volatility	22.6%	22.5%
Dividend yield	3.1%	2.2%
Expected life	6.6 years	4 years
Risk-free interest rate	3.2%	1.3%
Weighted average fair value per award	£10.49	£8.32

An estimate of future volatility is made with reference to historical volatility over a similar time period to

the performance period of the option. Historical volatility is calculated based on the annualised standard

deviation of the Group’s daily share price movement, which approximates the continuously compounded

rate of return on the share.

The weighted average fair value of the LTIP Performance Shares granted in the year was £51.38 per

award (2022: £57.73 per award).

Notes to the Financial Statements continued

24 Share Capital continued

198 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Movements in the year

The following table shows movements in the total number of outstanding awards across all award types:

		Year ended		Year ended
	31 December 2023			31 December 2022
		Weighted		Weighted
		average		average
	Number of	exercise	Number of	exercise
	awards	price	awards	price
Outstanding at 1 January	18,707,602	£44.99	17,985,398	£45.14
Granted	4,806,191	£36.92	5,717,048	£41.77
Exercised	(2,084,209)	£23.51	(1,388,034)	£38.56
Lapsed	(2,866,834)	£45.48	(3,606,810)	£43.09
Outstanding at 31 December	18,562,750	£45.24	18,707,602	£44.99
Exercisable at 31 December	3,009,018	£61.36	1,631,807	£57.54

The weighted average share price for the year was £58.38 (2022: £61.09).

Summary of outstanding awards

For awards outstanding at the year end the weighted average remaining contractual life is 5.3 years

(2022: 4.6 years) and the range of exercise prices is as follows:

	Price to be paid			Number of awards
	£			outstanding
			at 31 December	at 31 December
	From	To	2023	2022
LTIP – performance share options	38.06	78.00	11,522,463	10,545,453
LTIP – performance shares	–	–	3,584,219	3,815,827
LTIP – time-vested shares	–	–	861,596	655,717
SOPP	–	–	150,200	177,400
Savings-related share options	44.56	62.44	2,444,272	3,513,205
Total			18,562,750	18,707,602

For LTIP awards with non-market performance conditions, assumptions regarding the number of awards

that will eventually vest are based on the Directors’ expectations in light of the Group’s business model

and relevant published targets.

Under the terms of the schemes, early exercise may only be granted in exceptional circumstances and

therefore the effect of early exercise is not incorporated into the calculation of the charge.

No material modifications have occurred requiring revision to the share-based payment charge for the

outstanding awards.

26 Other Reserves

		Foreign
		currency	Total
	Hedging	translation	other
	reserve	reserve	reserves
Attributable to owners of the parent	£m	£m	£m
Balance at 1 January 2022	11	(1,200)	(1,189)
Other comprehensive income/(expense):
Fair value gains on cash flow hedges, net of tax	(32)	–	(32)
Reclassification of cash flow hedges to the income statement	34	–	34
Net exchange losses on foreign currency translation, net of tax	–	1,064	1,064
Losses on net investment hedges, net of tax	–	(115)	(115)
Reclassification of foreign currency translation reserves on disposal or liquidation of foreign operations, net of tax	–	(56)	(56)
Total other comprehensive income/(expense) for the year	2	893	895
Balance at 31 December 2022	13	(307)	(294)
Other comprehensive income/(expense):
Fair value losses on cash flow hedges, net of tax	(16)	–	(16)
Reclassification of cash flow hedges to the income statement	(23)	–	(23)
Net exchange losses on foreign currency translation, net of tax	–	(638)	(638)
Gains on net investment hedges, net of tax	–	42	42
Reclassification of foreign currency translation reserves on disposal or liquidation of foreign operations, net of tax	–	(131)	(131)
Total other comprehensive expense for the year	(39)	(727)	(766)
Balance at 31 December 2023	(26)	(1,034)	(1,060)

The hedging reserve comprises the effective portion of the cumulative net change in fair value of cash

flow hedging instruments related to hedge transactions that are extant at year end.

The foreign currency translation reserve contains the accumulated foreign exchange differences from

the translation of the Financial Statements of the Group’s foreign operations arising when the Group’s

entities are consolidated. The reserve also contains the translation of liabilities that hedge the Group’s

net exposure in a foreign currency.

During the year ended 31 December 2023, a net gain of £131 million (2022: £56 million net gain) was

reclassified to the Income Statement from foreign currency reserves following the disposal or liquidation

of foreign operations, of which a net gain of £130 million (2022: £69 million net gain) related to the

liquidation of subsidiaries (see Note 6 for further details) and a gain of £1 million (2022: £13 million loss)

comprised of £1 million (2022: £20 million) arising from the disposal of certain businesses (see Note 29),

less related tax credits of £nil (2022: £7 million) (see Note 7) .

Notes to the Financial Statements continued

25 Share-Based Payments continued

199 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

27 Related Party Transactions

The Group has related party relationships with its Directors and key management personnel (Note 5).

28 Dividends

		2023	2022
		£m	£m
Cash dividends on equity ordinary shares:
2022	Final paid: 1 1 0. 3p (2021: Final paid 1 0 1 . 6p) per share	790	726
2023	Interim paid: 76. 6p (2022: Interim paid: 73p) per share	549	523
Total dividends for the year		1,339	1,249

The Directors are proposing a final dividend in respect of the financial year ended 31 December 2023

of 11 5 .9 pence per share which will absorb an estimated £828 million of shareholders’ funds. If approved

by shareholders it will be paid on 24 May 2024 to shareholders who are on the register on 12 April 2024,

with an ex-dividend date of 11 April 2024.

29 Acquisitions and Disposals

Acquisitions

On 25 September 2023, the Group acquired a business distributing Reckitt products in the Kingdom of

Saudi Arabia. This has been accounted for as a business combination with the purchase consideration

£79 million, of which a preliminary fair value of £56 million has been allocated to goodwill and intangible

assets, and a preliminary fair value of £23 million to inventories acquired.

During 2022, the Group did not complete any acquisitions.

Disposals

During 2022, the Group completed the disposals of Dermicool and E45 on 25 March 2022 and 1 April 2022,

respectively, with combined net cash proceeds of £243 million. The net assets disposed primarily

comprised goodwill and other intangible assets at a book value of £204 million. In addition, cumulative

foreign exchange losses of £10 million have been reclassified to the Income Statement.

The Group recognised a net pre-tax gain of £14 million upon disposal of these brands, recorded within

net operating expenses in the Income Statement. Both Dermicool and E45 formed part of the Health

operating segment.

There were no disposals during 2023.

30 Forward Purchase of Shares Held by Non-Controlling Interest

On 25 May 2023 the Group entered into an agreement pursuant to which it will proceed to acquire the

remaining interests associated with the Company’s majority owned activities in mainland China and Hong

Kong (“RB Manon”) from its existing minority shareholders. The aggregate percentage interest of the

minority shareholders in each of the three relevant Reckitt subsidiaries is currently between 20% and

24.95%. RB Manon undertakes non-exclusive distribution of certain Reckitt brands in mainland China,

Hong Kong and other Asian Pacific countries. The transaction will be implemented through the purchase

of the non-controlling shareholdings in three subsidiaries of Reckitt held by the minority shareholders.

This will occur in multiple stages, which are expected to take place through to 31 December 2038,

although the agreement contains provisions for the purchase of shares to be made sooner.

The amounts payable to the minority shareholders take the form of consideration for the shares and

dividends that may be paid on the shares prior to their acquisition. Amounts payable to the minority

shareholders are dependent on the business performance of RB Manon. As at 25 May 2023, the estimated

present value of the total amounts payable under the agreement was £298 million based on projections

of future revenues and profitability of the RB Manon business, using a discount rate of 5.5% based on the

Group’s borrowing costs in China.

The agreement has different elements which are accounted for separately. As there are no specific

accounting standards prescribing the allocation of value in this arrangement, judgment is required to

allocate the total amount payable. The main elements relate (1) to a forward contract for the purchase

of a non-controlling interest in RB Manon and (2) services provided by the minority shareholders in

relation to the transition of leadership and shares in RB Manon. The amount allocated to the forward

purchase of shares has been based on its estimated value, with the residual amount allocated to the

services to transition the leadership and shares as the value of these services are not estimable on

a standalone basis.

An amount of £167 million has been allocated to the forward purchase of shares, which represents the

minimum exit value under the agreement that minority shareholders could realise for their shares absent

any transitional arrangements. This amount has been recorded as a liability with £143 million charged

to retained earnings and the remaining £24 million to extinguish the existing non-controlling interest.

Any future changes to the present value of this liability will be recorded to the Income Statement.

The Group considers that any reasonable possible change in key assumptions would not lead to a

material adjustment to this estimated present value in the next year. The remaining £131 million has

been allocated to the transitional services element, which will be recognised as a liability and charged

to the Income Statement over the performance period for these services.

Notes to the Financial Statements continued

200 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

31 Assets Held For Sale

Assets and liabilities held for sale of £55 million, principally intangible assets, relate to the anticipated

disposal of certain brands within the Health Operating Segment for which the relevant sale progress

is ongoing. The relevant disposal is expected to complete in the first half of 2024 and contribute c.0.5%

revenue into the Group’s 2023 Net Revenue.

32 Discontinued Operations

The income from discontinued operations of £9 million (2022: £7 million loss) relates to the Group’s

disposal of the RB Pharmaceuticals business (now Indivior plc).

33 Post Balance Sheet Events

On 13 March 2024, a state court jury in Belleville, Illinois awarded $60 million to a mother of a child who

was born prematurely and died 25 days later from Necrotizing Enterocolitis (NEC). Reckitt believe the

allegations from the plaintiff’s lawyers in this case were not supported by the science or the experts in

the medical community. Reckitt are actively considering all options, and at this time an economic outflow

is not considered probable. There is a possible outcome that may be unfavourable, however, the Group

may benefit from relevant product liability insurance subject to limits and deductibles that the Group

considers to be reasonable. All policies contain exclusion and limitations and there can be no assurance

that insurance will be available or adequate to cover this case. More details on NEC claims generally can

be found in Note 20.

Notes to the Financial Statements continued

201 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

The five-year summary below is presented on an IFRS basis. The years ending 31 December 2019, 31 December 2020, 31 December 2021, 31 December 2022 and 31 December 2023 show the results for

continuingoperations.

Income Statement

2023

£m

2022

£m

2021

£m

2020

£m

2019

£m

Net Revenue 14,607 14,453 13,234 13,993 12,846

Operating profit/(loss) 2,531 3,249 (804) 2,160 (1,954)

Net finance (expense)/income (130) (161) 547 (286) (153)

Share of loss and impairment of equity-accounted investees, net of tax – (21) (3) (1) –

Profit/(loss) before income tax 2,401 3,067 (260) 1,873 (2,107)

Income tax (charge)/credit (753) (711) 208 (720) (665)

Attributable to non-controlling interests (14) (19) (11) (16) (13)

Net profit/(loss) attributable to owners of the parent company from continuing operations 1,634 2,337 (63) 1,137 (2,785)

Balance Sheet

Net assets 8,469 9,483 7,453 9,159 9,407

Key Statistics – IFRS basis

Operating margin 17. 3% 22.5% (6.1%) 15.4% (15.2%)

Diluted earnings per share, continuing 227. 4p 325.7p (8.8p) 159.3p (393.0p)

Declared total dividends per ordinary share 192.5p 183.3p 174.6p 174.6p 174.6p

Five Year Summary (Unaudited)

202 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Note

2023

£m

2022

£m

Fixed assets

Investments 2 15,174 15,078

Current assets

Debtors due within one year 3, 6 185 40

Debtors due after more than one year 4, 6 14 21

199 61

Current liabilities

Creditors due within one year 5, 6 (5,361) (7,846)

Share repurchase liability 8 (296) –

Net current liabilities (5,458) (7,785)

Total assets less current liabilities 9,716 7,293

Provisions for liabilities and charges 7 (26) (44)

Net assets 9,690 7,249

EQUITY

Share capital 8 74 74

Share premium 254 254

Retained earnings 9,362 6,921

Total equity 9,690 7,249

Reckitt Benckiser Group plc has made a profit of £4,135 million (2022: £4,276 million) for the financial year.

The Financial Statements on pages 202-217 were approved by the Board of Directors and signed on its

behalf on 21 March 2024 by:

Christopher Sinclair Kris Licht

Director Director

Reckitt Benckiser Group plc Reckitt Benckiser Group plc

Company Number: 06270876

capital

£m

premium

£m

Retained

earnings

£m

Total

equity

£m

Balance at 1January2022 74 253 3,763 4,090

Comprehensive income

Profit for the financial year – – 4,276 4,276

Total comprehensive income – – 4,276 4,276

Transactions with owners

Treasury shares reissued – 1 53 54

Share-based payments 1 1

Capital contribution in respect of share-based payments – – 77 77

Cash dividends – – (1,249) (1,249)

Total transactions with owners – 1 (1,118) (1,117)

Balance at 31 December 2022 74 254 6,921 7,249

Comprehensive income

Profit for the financial year – – 4,135 4,135

Total comprehensive income – – 4,135 4,135

Transactions with owners

Treasury shares reissued – – 48 48

Purchase of ordinary shares by employee share

ownership trust – – (2) (2)

Repurchase of shares – – (503) (503)

Share-based payments – – 6 6

Capital contribution in respect of share-based payments – – 96 96

Cash dividends – – (1,339) (1,339)

Total transactions with owners – – (1,694) (1,694)

Balance at 31 December 2023 74 254 9,362 9,690

Reckitt Benckiser Group plc has £8,521million (2022:£6,182million) of its retained earnings available for

distribution. Details of Treasury shares and other equity transactions are included in Note24 of the Group

Financial Statements.

Parent Company Balance Sheet

As at 31 December 2023

Parent Company Statement of Changes in Equity

For the year ended 31 December 2023

203 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

1 Parent Company Accounting Policies

The principal accounting policies are summarised below. They have all been applied consistently

throughout the year and the preceding year.

General information and basis of accounting

Reckitt Benckiser Group plc is a company incorporated in the United Kingdom, registered in England and

Wales under the Companies Act 2006, and is a public limited company. The address of the registered

office is given on page 230.

The Company is the parent of the Reckitt Benckiser Group and its principal activity is to act as a holding

company for the Group. The nature of the Group’s operations and its principal activities are set out in the

Strategic Report on pages 2 to 61.

New standards, amendments and interpretations

The following amended standards and interpretations were adopted bythe Company during the year

ending 31 December 2023. This amended standard has not had a significant impact on the Company

Financial Statements.

– Amendments to FRS 102 – International tax reform – Pillar Two model rules

Statement of compliance

The Financial Statements have been prepared under the historical cost convention and in compliance

with United Kingdom Accounting Standards, including Financial Reporting Standard 102, The Financial

Reporting Standard applicable in the United Kingdom and the Republic of Ireland (FRS 102) and the

Companies Act 2006.

The functional currency of Reckitt Benckiser Group plc is considered to be Pounds Sterling because that

is the currency of the primary economic environment in which the Company operates.

As permitted by s408 of the Companies Act 2006, a Statement of Comprehensive Income is not

presented for Reckitt Benckiser Group plc.

Going concern

Having assessed the principal risks and other matters discussed in connection with the Group’s Viability

Statement as set out on page 61 of the Group Annual Report, the Directors considered it appropriate

toadopt the going concern basis of accounting in preparing the Company Financial Statements.

Whenreaching this conclusion, the Directors took into account the Company’s overall financial position

and exposure to principal risks.

Financial Reporting Standard 102 – Reduced Disclosure Exemptions

FRS 102 allows a qualifying entity certain disclosure exemptions, subject to certain conditions, which have

been complied with.

The Company has taken advantage of the following exemptions:

(i) from preparing a Statement of Cash Flows, on the basis that it is a qualifying entity and the Group

Cash Flow Statement, included in these Financial Statements, includes the Company’s cash flows; and

(ii) from disclosing the Company key management personnel compensation, as required by FRS 102

paragraph 33.7.

The Company’s results are included in the publicly available consolidated Financial Statements of

ReckittBenckiser Group plc and these Financial Statements may be obtained from 103-105 Bath Road,

Slough, Berkshire SL1 3UH or at www.reckitt.com.

Foreign currency translation

Transactions denominated in foreign currencies are translated using exchange rates prevailing at the

dates of the transactions. Foreign exchange gains and losses resulting from the settlement of foreign

currency transactions and from the translation at year end exchange rates of monetary assets and

liabilities denominated in foreign currencies are recognised in the Statement of Comprehensive Income.

Taxation

The tax charge/credit is based on the result for the year and takes into account taxation deferred due

totiming differences between the treatment of certain items for taxation and accounting purposes.

Deferred tax liabilities are provided for in full and deferred tax assets are recognised to the extent that

they are considered recoverable.

A net deferred tax asset is considered recoverable if it can be regarded as more likely than not that there

will be suitable taxable profits against which to recover carried forward tax losses and from which the

future reversal of underlying timing differences can be deducted.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at

the Balance Sheet date, where transactions or events that result in an obligation to pay more tax in the

future or a right to pay less tax in the future have occurred at the Balance Sheet date.

Deferred tax is measured at the average tax rates that are expected to apply in the periods in which the

timing differences are expected to reverse, based on tax rates and laws that have been enacted or

substantively enacted by the Balance Sheet date. Deferred tax is measured on an undiscounted basis.

The Company has applied the temporary mandatory exception from accounting for deferred taxes

arising from the Pillar Two model rules as set out in ‘International Tax Reform – Pillar Two Model Rules

(Amendments to FRS102)’ issued by the FRC in July 2023.

Notes to the Parent Company Financial Statements

204 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Fixed asset investments

Fixed asset investments are stated at the lower of cost or their recoverable amount, which is determined

as the higher of net realisable value and value-in-use. A review of the potential impairment of an

investment is carried out by the Directors if events or changes in circumstances indicate that the

carrying value of the investment may not be recoverable. Such impairment reviews are performed

inaccordance with FRS 102 Section 27 ‘Impairment of assets’.

Employee share schemes

Incentives in the form of shares are provided to employees under equity-settled share option and

restricted share schemes, which have various combinations of market-based and non-market

performance conditions, service conditions, and non-vesting conditions.

The fair value determined at the award grant date takes into account the probability of any relevant

market-based performance conditions and non-vesting conditions being satisfied and is subsequently

expensed on a straight-line basis over the vesting period, based on the Company’s estimate of equity

instruments that will eventually vest. This estimate takes into account the expected outcome for relevant

non-market performance conditions and service conditions but assumes satisfaction of all market-based

performance conditions and non-vesting conditions. At each Balance Sheet date, the Company revises its

estimate of the number of equity instruments expected to vest. The impact of the revision of the original

estimates, if any, is recognised in the Statement of Comprehensive Income such that the cumulative

expense reflects the revised estimate, with a corresponding adjustment to equity reserves.

Additional employer costs, including social security taxes, in respect of options and awards are charged to

the Statement of Comprehensive Income over the same period with a corresponding liability recognised.

The grant by the Company of options over its equity instruments to the employees of subsidiary

undertakings in the Group is treated as a capital contribution. The fair value of employee services

received, measured by reference to the grant date fair value, is recognised over the vesting period as an

increase to investment in subsidiary undertakings, with a corresponding credit to equity in the Company

Financial Statements.

Financial instruments

The Company recognises financial instruments when it becomes a party to the contractual obligations

ofthe instrument.

(i) Financial assets

Basic financial assets are initially recognised at transaction price, unless the arrangement constitutes

afinancing transaction, where the transaction is measured at the present value of the future receipts.

Such assets are subsequently carried at amortised cost.

At the end of each reporting period financial assets measured at amortised cost are assessed for

objective evidence of impairment. If an asset is impaired the impairment loss is the difference between

the carrying amount and the present value of the estimated cash flows discounted at the asset’s original

effective interest rate. The impairment loss is recognised in comprehensive income or expense.

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire

or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred

to another party, or (c) control of the asset has been transferred to another party who has the practical

ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.

(ii) Financial liabilities

Basic financial liabilities, including loans from fellow Group companies, are initially recognised at

transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument

is measured at the present value of future payments. Debt instruments are subsequently carried at

amortised cost.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual

obligation is discharged, cancelled or expires.

(iii) Derivative Financial Instruments

Derivatives, including forward foreign exchange contracts, are not basic financial instruments.

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and

subsequently re-measured at their fair value.

The Company designates certain derivative financial instruments as fair value hedges against certain

debtors in USD. Gains or losses arising from changes in the foreign exchange retranslation of the hedged

item and instrument are netted in profit or loss in the period in which they arise.

Provisions

Provisions are recognised when the Company has a present legal or constructive obligation as a

resultofpast events; it is more likely than not that there will be an outflow of resources to settle that

obligation; and the amount can be reliably estimated. Provisions are valued at the present value of the

Directors’ best estimate of the expenditure required to settle the obligation at the Balance Sheet date.

Where it ispossible that a settlement may be reached or it is not possible to make a reliable estimate

ofthe estimated financial impact, appropriate disclosure is made but no provision recognised.

Where a company enters into a financial guarantee contract to guarantee the indebtedness of other

companies within its Group, the Company treats the guarantee contract as a contingent liability until

such a time as it becomes probable that the Company will be required to make a payment under

theguarantee.

Share capital transactions

When the Company purchases equity share capital, the amount of the consideration paid, including

directly attributable costs, is recognised as a charge to equity. Purchased shares are either held in

Treasury in order to satisfy employee options, or cancelled and, in order to maintain capital, an equivalent

amount to the nominal value of the shares cancelled is transferred from retained earnings.

Notes to the Parent Company Financial Statements continued

1 Parent Company Accounting Policies continued

205 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Repurchase and reissuance of ordinary shares

When shares recognised as equity are repurchased, the amount of the consideration paid, including

directly attributable costs, is recognised as a charge to equity. Repurchased shares are classified as

Treasury shares and are presented in retained earnings. When Treasury shares are sold or reissued

subsequently, the amount received is recognised as an increase in equity and the resulting surplus

ispresented within share premium.

Dividend distribution

Dividends to owners of the parent company are recognised as a liability in the period in which the

dividends are approved by the company’s shareholders. Interim dividends are recorded in the period

inwhich they are approved and paid.

Accounting estimates and judgements

In preparing these Financial Statements, management has made judgements and estimates that affect

the application of the Company’s accounting policies and the reported amounts of assets, liabilities,

income and expenses. Actual amounts and results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting

estimates are recognised in the period in which the estimate is revised if the revision affects only

thatperiod, or in the period of the revision and future periods if the revision affects both current

andfuture periods.

Key sources of estimation uncertainty

Each year, management is required to make a number of assumptions regarding the future. The related

year end accounting estimates will, by definition, seldom equal the final actual results. The estimates

andassumptions that have a significant risk of causing a material adjustment to the carrying amounts

ofassets and liabilities within the next financial year are addressed below.

Tax provisions

Current tax liabilities include an amount of £156million (2022:£132million) relating to uncertain tax

positions in respect of tax deductibility of management expenses. The exposure recognised is

calculated based on the expected value method and the most likely amount method. The accounting

estimates and judgements considered include:

– status of the unresolved matter;

– clarity of relevant legislation and related guidance;

– advice from related party specialists and unrelated third parties;

– range of possible outcomes; and

– statute of limitations.

The recognition of uncertain tax positions is reviewed regularly for changes in circumstances and

estimates are updated as potential resolutions for the tax uncertainties are encountered through specific

audits or wider case law. As a result, given the size, possible range of outcomes and timing of resolution,

there is a significant risk of material adjustment to the aggregate carrying amount of these liabilities

within the next financial year.

Legal provisions

The Company recognises legal provisions in line with the Company’s provisions policy. The level of

provisioning in relation to civil and/or criminal investigations is an area where management and legal

judgment is important, with individual provisions being based on best estimates of the probable loss,

considering all available information, external advice and historical experience. As at 31 December 2023,

the Company recognised legal provisions of £26million (2022:£44million) in relation to a number of

historical regulatory matters. Refer to Note7 of the Company Financial Statements for further information.

The Company’s Directors are of the opinion that there are no other judgements and no further key

sources of estimation uncertainty in applying the Company’s accounting policies.

2 Investments

Shares in

subsidiary

undertakings

£m

Cost

At 1January2022 15,001

Additions during the year 77

At 31 December 2022 15,078

Additions during the year 96

At 31 December 2023 15,174

Provision for impairment

At 1January2022 –

At 31 December 2023 –

Net book value

At 31 December 2022 15,078

At 31 December 2023 15,174

The Directors believe that the carrying value of the investments is supported by their underlying

netassets.

The subsidiary undertakings as at 31 December 2023, all of which are included in the Group Financial

Statements, are shown in Note12 of the Company Financial Statements.

Notes to the Parent Company Financial Statements continued

1 Parent Company Accounting Policies continued

206 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

With the exception of Reckitt Benckiser Limited, none of the subsidiaries are directly held by Reckitt

Benckiser Group plc. All subsidiaries have a financial year ending 31 December with the exception of:

Reckitt Benckiser (India) Private Limited, Reckitt Benckiser Healthcare India Private Limited, Mead

Johnson Nutrition (India) Private Limited, RB Hygiene Home India Private Limited, Reckitt Piramal Private

Limited and Scholl Latin America Limited which have a year ending 31 March; Reckitt Benckiser Health

Kenya Limited which has a year ending 30 April; Reckitt Benckiser (Czech Republic) spol. s r.o which has

ayear ending 31 May; Lloyds Pharmaceuticals which has a year ending 24 August; RBHCR Health Reckitt

Costa Rica Sociedad Anónima which has a year ending 30 September and Pt Reckitt Benckiser Indonesia

which has a year ending 29 October.

Additions during the year, and in 2022, relate to the grant by the Company of options over its equity

instruments to the employees of subsidiary undertakings in the Group.

3 Debtors Due Within One Year

2023

£m

2022

£m

Amounts owed by Group undertakings 178 30

Other debtors 7 10

185 40

Amounts owed by Group undertakings are unsecured, interest free and are repayable on demand

(2022:same).

4 Debtors Due After More Than One Year

2023

£m

2022

£m

Deferred tax assets 1 1

Other receivables 13 20

14 21

Deferred tax assets consist of short-term timing differences.

5 Creditors Due Within One Year

2023

£m

2022

£m

Amounts owed to Group undertakings 5,196 7,707

Taxation and social security 157 133

Derivative liabilities 1 2

Other creditors 7 4

5,361 7,846

Included in the amounts owed to Group undertakings is an amount of £5,123million (2022:£7,609million)

which is unsecured, carries interest at the official ISDA fallback rate and is repayable on demand

(2022:same). All other amounts owed to Group undertakings are unsecured, non-interest bearing

andare repayable on demand (2022:same).

Included within taxation and social security creditors is an amount recognised in respect of uncertain

taxpositions may take several years to resolve (Note 1). Notwithstanding this, the presentation of

corporation tax liabilities has been assessed to reflect that there is not an unconditional right to defer

settlement of these liabilities and the carrying amount of £156 million (2022: £132 million) has been

presented as a current liability.

6 Financial instruments

2023

£m

2022

£m

Financial assets measured at amortised cost

Amounts owed by Group undertakings 178 30

Other receivables – current and non-current 20 30

198 60

Financial liabilities

Derivative financial instruments measured at fair value through profit or loss

Derivative liabilities (1) (2)

Financial liabilities measured at amortised cost

Amounts owed to Group undertakings (5,196) (7,707)

Share repurchase liability (296) –

Other payables (7) (4)

(5,500) (7,713)

Notes to the Parent Company Financial Statements continued

2 Investments continued

207 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

7 Provisions for Liabilities and Charges

Legal

provisions

£m

Total

provisions

£m

At 1January2022 41 41

Charged to the Statement of Comprehensive Income 14 14

Utilised during the year (7) (7)

Released to the Statement of Comprehensive Income (4) (4)

At 31 December 2022 44 44

Charged to the Statement of Comprehensive Income 1 1

Utilised during the year (18) (18)

Released to the Statement of Comprehensive Income (1) (1)

At 31 December 2023 26 26

Provisions have been analysed between current and non-current as follows:

2023

£m

2022

£m

Current 26 43

Non-current – 1

26 44

Provisions relate to legal provisions in relation to a number of historical matters.

8 Share Capital

Issued and fully paid

Equity

ordinary

Nominal

value

£m

At 31 December 2022 736,535,179 74

At 31 December 2023 736,535,179 74

The holders of ordinary shares (par value 10 pence) are entitled to receive dividends as declared from

time to time and are entitled to one vote per share at meetings of the Parent Company. Dividends

proposed and paid are disclosed in Note28 of the Group Financial Statements.

The allotment of ordinary shares and release of Treasury shares are disclosed in Note24 of the Group

Financial Statements.

In addition, the Company announced a share buyback programme also disclosed in Note 24 of the Group

Financial Statements.

9 Related Party Transactions

There were no transactions with related parties other than wholly owned companies within the Group

10 Contingent Liabilities

The Company has issued a guarantee to the trustees of the Reckitt Benckiser Pension Fund covering the

obligations of certain UK subsidiaries of the Group who are the sponsoring employers of the UK defined

benefit pension fund. The guarantee covers any amounts due to the pension fund from these subsidiaries

if they fail to meet their pension obligations.

The Company issued a guarantee on behalf of Reckitt Benckiser Treasury Services plc in relation to the

issuance of a $4,500 million bond (2022: $5,000 million bond), made up of one tranche of $2,500 million

and one tranche of $2,000 million (2022: one tranche of $2,500 million, one tranche of $2,000 million and

one tranche of $500 million). The Company has issued a further guarantee in relation to the issuance of

a£500 million bond (2022: £500 million). Details are included in Note 15 of the Group Financial Statements.

During the year, the Company issued a guarantee on behalf of Reckitt Benckiser Treasury Services plc in

relation to the issuance of a €1,400 million bond, made up of one tranche of €750 million and one tranche

of €650 million. The Company has issued a further guarantee in relation to the issuance of a £300 million

bond. Details are included in Note 15 of the Group Financial Statements.

The Company issued a guarantee on behalf of Reckitt Benckiser Treasury Services plc in relation to

committed borrowing facilities totalling £4,500 million (2022: £4,500 million). Details of the facilities

areincluded in Note 15 of the Group Financial Statements.

The Company issued a guarantee on behalf of Mead Johnson Nutrition Company in relation to

outstanding senior notes of $1,550 million (2022: $1,550 million) issued by Mead Johnson Nutrition

Company prior to acquisition. The senior notes consist of one tranche of $750 million, one tranche

of$500 million and one tranche of $300 million (2022: same).

The Company has also issued a guarantee on behalf of Reckitt Benckiser Treasury Services (Nederland)

BV in relation to the issuance of two €850 million bonds (2022: two €850 million bonds). Details are

included in Note 15 of the Group Financial Statements.

The Company has provided a guarantee to certain subsidiary undertakings to exempt them from audit

under Section 479a of the Companies Act 2006. The companies to which a guarantee has been issued

forthis purpose are highlighted in Note 12.

Other contingent liabilities are disclosed in Note 20 of the Group Financial Statements.

11 Post Balance Sheet Events

There are no events subsequent to the balance sheet date that require disclosure.

Notes to the Parent Company Financial Statements continued

208 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings

In accordance with Section 409 of the Companies Act 2006

(the‘CA2006’) and Schedule 4 of The Large and Medium-sized

Companies and Groups (Accounts and Reports) Regulations 2008,

afull list of related undertakings as at 31 December 2023 is disclosed

below. All undertakings are indirectly owned by Reckitt Benckiser

Group plc, unless otherwise stated. All shares detailed below are

100% owned, unless specified otherwise. The percentage held by

the Group reflects both the proportion of nominal capital and voting

rights unless stated otherwise.

From time to time, management reviews the Group structure

andseeks to remove redundant, dormant or non-trading entities.

During the year ended 31 December 2023, five legal entities were

dissolved, liquidated or otherwise disposed of (2022: 17 legal entities).

The removal of legal entities ultimately allows management to focus

on the core business, reduces compliance obligations and cost,

andimproves transparency of the Group to external parties.

All subsidiary undertakings of Reckitt Benckiser Group plc are

included in the consolidated Financial Statements of the Group.

Thesubsidiary undertakings marked with * are exempt from the

requirements under section 479A of the CA 2006 relating to the

audit of their individual accounts, as Reckitt Benckiser Group plc

hasguaranteed them under Section 479C of the CA 2006.

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Argentina

Bucarelli 2608 PB “A”, Ciudad Autonoma de Buenos Aires, Argentina

Reckitt Benckiser Argentina S.A. Ordinary

Reckitt Benckiser Health Argentina

S.A.

Ordinary

Australia

King & Wood Mallesons, ‘Governor Phillip Tower’ Level 61, 1 Farrer Place, Sydney

NSW 2000, Australia

Mead Johnson Nutrition (Australia)

Pty Ltd

Ordinary

Level 47, 680 George Street, Sydney NSW 2000, Australia

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

RB (Hygiene Home) Australia Pty

Limited

Ordinary

Reckitt Benckiser (Australia) Pty

Limited

Ordinary,

Preference

Reckitt Benckiser Healthcare

Australia Pty Limited

Ordinary

SSL Australia Pty Ltd Ordinary

Austria

Guglgasse 15, 1110, Vienna, Austria

RB Hygiene Home Austria GmbH Ordinary

Reckitt Benckiser Austria GmbH Ordinary

Bahamas

c/o 103-105 Bath Road, Slough, Berkshire SL1 3UH, United Kingdom

Scholl Latin America Limited + – Ordinary

Bahrain

Building 330, Road 1506, Block 115, Bahrain International Investment ParK, Hidd.

Kingdom of Bahrain, Bahrain

Reckitt Benckiser Bahrain W.L.L Ordinary

Bangladesh

58-59 Nasirabad Industrial Area, Chittagong 4209, Bangladesh

Reckitt Benckiser (Bangladesh) PLC 82.9612 Ordinary

Belarus

of. 166, 66, K Liebknekhta st., Minsk, 220036, Belarus

Reckitt Benckiser BY LLC Charter

Capital

Belgium

20 Allée de la Recherche, 1070 Anderlecht, Belgium

RB Hygiene Home Belgium SA/NA Ordinary

Reckitt Benckiser (Belgium) SA/NV Ordinary

Bermuda

Clarendon House, Church Street, Hamilton HM11, Bermuda

Suffolk Insurance Limited Common

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Brazil

Av Guarapari, S/N, Galpao1 – Modulos 05 Ao 14cond Log Vianaii Bus/Park, Viana,

Es, 29.136-344, Brazil

Reckitt Benckiser (Brasil) Comercial

de Produtos de Hygiene, Limpeza e

Cosméticos Ltda. – Branch Viana

# –

Av. Portugal, nº 1.100, Setor Rua 6 Parte A12, Bairro Itaqui, Itapevi, São Paulo,

06696-060, Brazil

Reckitt Benckiser Health Comercial

Ltda

# –

Avenida Presidente Juscelino Kubitschek, n° 1909, 24° andar, Parte B, Torre Norte,

Condomínio São Paulo Corporate Towers, Vila Nova Conceição, Sao Paulo – SP,

CEP 04.543-907, Brazil

Reckitt Benckiser (Brasil) Comercial

de Produtos de Hygiene, Limpeza e

Cosméticos Ltda.

Ordinary

Mead Johnson do Brasil Comércio e

Importação de Produtos de

Nutrição Ltda.

Ordinary

Reckitt Benckiser Health Comercial

Ltda

Ordinary

Est Dona Maria Jose Ferraz Prado, 1481, Cond Dist. Park Embu, Brazil

Reckitt Benckiser (Brasil) Comercial

de Produtos de Hygiene, Limpeza e

Cosméticos Ltda. – Branch Embu

# –

Estm Maria Margarida Pinto Dona Belinha, 742, GalpaO3, Bloco I/A, Brazil

Reckitt Benckiser (Brasil) Comercial

de Produtos de Hygiene, Limpeza e

Cosméticos Ltda. – Branch Extrema

# –

Estrada Fukutaro Yida, n. 930, Bairro Cooperativa, Sao Bernardo Do Campo, Sao

Paulo, 09852-060, Brazil

Apenas Boa Nutrição Indústria de

Alimentos Ltda.

Ordinary

Rod Dom Gabriel Paulino Bueno Couto, 1606, Brazil

Reckitt Benckiser (Brasil) Ltda

– Branch Itupeva

# –

Rod Governador Mario Cova, 7270, KM 264 Parte RB, Brazil

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

209 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Notes to the Parent Company Financial Statements continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser (Brasil) Comercial

de Produtos de Hygiene, Limpeza e

Cosméticos Ltda. – Branch Serra

# –

Rodovia Antonio Heil, SC 486, km 4, Bairro Itaipava, “Armazém 1B”, Itajaí, São

Paulo, CEP 88316-003, Brazil

Mead Johnson Do Brasil Comércio E

Importação De Produtos De

Nutrição Ltda.

# –

Rodovia Raposo Tavares, 8015 km 18, Jardim Arpoador, Sao Paolo, CEP 05577-900,

Brazil

Fenla Indústria, Comércio e

Administração Ltda

Ordinary

Reckitt Benckiser (Brasil) Ltda Ordinary

Bulgaria

22 Zlaten rog Street, Floor 3, Office 4, District of Lozenets, City of Sofia, Bulgaria

Reckitt Benckiser Romania,

representative office

# –

Canada

Suite 600, 1741 Lower Water Street, Halifax NS B3J 0J2, Canada

Mead Johnson Nutrition (Canada)

Co.

Common

Suite 2300, 550 Burard Street, Vancouver BC V6C 2B5, Canada

RB Health (Canada) Inc. Common

1680 Tech Avenue, Unit 2, Mississauga ON L4W 5S9, Canada

Reckitt Benckiser (Canada) Inc. Common

Cayman Islands

PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands

Reckitt Benckiser (Cayman Islands)

Limited

Ordinary

Chile

Avenida Presidente Kennedy Lateral 5454, Oficina 1602, Vitacura, Región

Metropolitana, Chile

Reckitt Benckiser Chile S.A. Ordinary

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

China

16/F, Xu Jia Hui International Plaza, No.1033 Zhao Jia Bang Road, Shanghai, China

RB & Manon Hygiene Home

(Shanghai) Limited

+ 80.0000 Ordinary

B01, Suite 401, Unit 2, No. 9 Dongdaqiao Road, Chaoyang District, Beijing, China,

China

RB (China) Holding Co. Limited Capital

Contribution

C6-8 Site 6F, No.333 Futexi Road, Waigaoqiao Free Trade Zone, Shanghai City,

China

Reckitt Benckiser Home Chemical

Products Trading (Shanghai) Co.

Limited

Ordinary

Dangtu Economic Development District, Maanshan City, Anhui Province, China

Guilong Health Technology (Anhui)

Co., Limited

Capital

Contribution

Anhui Guilong Pharmaceutical

Trading Company Limited

Capital

Contribution

Guilong Pharmaceutical (Anhui)

Company Limited

Capital

Contribution

Ketian Aquatic Science and Technology Industrial Park, No. 3949 Kunlunshan

Avenue, Lanzhou New Area, Lanzhou City, Gansu Province, China

Lanzhou Keshi Xixili Healthcare

Technologies Co. Ltd

80.0000 Ordinary

No. 3, Canglian 1 road, ETDZ, Guangzhou, China

Reckitt & Colman (Guangzhou)

Limited

Ordinary

No. 34 East Beijing Road, Jingzhou, Hubei, 434001, China

Reckitt Benckiser Household

Products (China) Company Limited

Capital

Contribution

No. 99, Changjiang Da Road, Fuqiao Town, Taicang City, China

RB (Suzhou) Co. Ltd Capital

Contribution

No.1-13 Shangma, Aodong Road, High-tech Industrial Development Zone, Qingdao

City, Shandong Province, China

Qingdao London Durex Co., Limited Ordinary

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Qingdao New Bridge Corporate

Management Consulting Company

Limited

Ordinary

Room 1605, No.660 Shangcheng Road, Pudong District, Shanghai City, China

SSL Healthcare (Shanghai) Limited Ordinary

Room 1701, No. 1033, Zhao Jia Bang Road, Xuhui District, Shanghai, China

RB & Manon Business Co. Limited 75.0000 Capital

Contribution

Room 2109, Floor 2, No.10 Chaoyangmenwai Street, Chaoyang District, Beijing City,

China

Tai He Tai Lai Culture

Communication Co Limited

Ordinary

Unit 02, 11/F, Tower A Hedonic Center, 6 Songyue Road, Siming District, Xiamen,

China

Guilong Pharmaceutical (Anhui) Co.

Ltd – Xiamen branch

# –

Colombia

Calle 76 No 11-17, Edificio Torre, Los Nogales Piso 2, Bogota, CO, Colombia

Mead Johnson Nutrition Colombia

Ltda

Ordinary

RB (Health) Colombia S.A.S. Ordinary

Carrera 6 #45-105, Cali, Colombia

Reckitt Benckiser Colombia S.A Ordinary

Costa Rica

San Jose-Escazu En Escazu Corporate Center, Setimo Piso, Costado Sur De

Multiplaza Escazu, Costa Rica

RBHCR Health Reckitt Costa Rica

Sociedad Anónima

Common

Reckitt Benckiser (Centroamérica)

S.A.

Ordinary

Croatia

Ulica Grada Vukovara 269d, 10 000 Zagreb, Hrvatska, Croatia

Reckitt Benckiser d.o.o. Ordinary

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

210 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Cyprus

1 Lampousas Street, P.C. 1095, Nicosia, Cyprus

Gainbridge Investments (Cyprus)

Limited

Ordinary

Czech Republic

Vinohradská 2828/151, 130 00 Praha 3-Žižkov, Czech Republic

RB (Hygiene Home) Czech Republic,

spol. s.r.o.

Ordinary

Reckitt Benckiser (Czech Republic)

spol s.r.o.

Partnership

Interest

Denmark

Vandtårnsvej 83 A, 2860, Søborg, Denmark

RB Health Nordic A/S Ordinary

RB Hygiene Home Nordic A/S Ordinary

Dominican Republic

Av. Winston Churchill No. 1099 Torre Acrópolis, Piso 12, Santo Domingo, República

Dominicana

Mead Johnson Nutrition

(Dominicana), S.A.

# –

Ecuador

Av CoruñaN27-88 y Orellana, Edificio Coruña Plaza 7mo Piso, Quito, 170150,

Ecuador

RB Health Ecuador Cía. Ltda Ordinary

Oficina 4C, Av. 12 de Octubre, #26-48 y Orellana, Edificio Mirage, Piso 4, Quito,

170525, Ecuador

Reckitt Benckiser Ecuador S.A. Ordinary

Egypt

Polyom Building, 22 Off Road 90, Fifth District, Fifth Settlement, New Cairo, Cairo,

Egypt

Reckitt Benckiser Egypt Limited Ordinary

Building A1, Second Floor, Plot #A14b01, Cairo Festival City, First District, Fifth

Settlement, New Cairo, Cairo, Egypt

Reckitt Benckiser Hygiene Home

Egypt Limited

+ Ordinary

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Estonia

Harju maakond, Rae vald, Rae küla, Raeküla tee 5, 75310, Estonia

Reckitt Benckiser (Latvia) SIA Eesti

filiaal

# –

Finland

Itsehallintokuja 6, 02600 Espoo, Finland, Finland

RB Health Nordic A/S sivuliike

Suomessa

# –

RB Hygiene Home Nordic A/S,

sivuliike Suomessa

# –

France

38 rue Victor Basch- 91300 Massy, France

Airwick Industrie SAS Ordinary

RB Holding Europe Du Sud SAS Ordinary

RB Hygiene Home France SAS Ordinary

Reckitt Benckiser Chartres SAS Ordinary

Reckitt Benckiser France SAS Ordinary

Reckitt Benckiser Healthcare

France SAS

Ordinary

Germany

Darwinstrasse 2-4, 69115, Heidelberg, Germany

RB Hygiene Home Deutschland

GmbH

Capital

Contribution

Reckitt & Colman Sagrotan

Verwaltungsgesellschaft GmbH

Common

Reckitt Benckiser Detergents

GmbH

Ordinary

Reckitt Benckiser Deutschland

GmbH

Common

Reckitt Benckiser Holding GmbH &

Co KG

Capital

Contribution

Heinestrasse 9, 69469, Weinheim, Germany

Kukident GmbH Common

Robert-Koch-Straße 1, 69115, Heidelberg, Germany

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Propack Produkte fur Haushalt und

Korperpflege GmbH

Ordinary

Reckitt Benckiser Global R&D

GmbH

Common

Greece

7 Taki Kavalieratou Street, Kifissia, 145 64, Greece

Reckitt Benckiser Hellas Healthcare

S.A.

Ordinary

Reckitt Benckiser Hellas Hygiene

Home S.A.

Ordinary

Guernsey

1st and 2nd Floors, Elizabeth House, Les Ruettes Brayes, St Peter Port, GY1 1EW,

Guernsey

Reckitt Benckiser Holdings

(Channel Islands) Limited

Bonus,

Ordinary

Hong Kong

Room 2001, 20/F, Greenfield Tower, Concordia Plaza, No.1 Science Museum Road,

Tsim Sha Tsui, Kowloon, Hong Kong

RB & Manon Hygiene Home Limited 80.0000 Ordinary

Rooms 2206-11, 22 Floor, Chubb Tower, Windsor House, 311 Gloucester Road,

Causeway Bay, Hong Kong

London International Trading (Asia)

Limited

Ordinary

Oriental Medicine Company Limited Ordinary

Reckitt Benckiser Hong Kong

Limited

Ordinary

Unit 2001, 20/F, Greenfield Tower Concordia Plaza, No. 1 Science Museum Road,

Kowloon, Hong Kong

RB & Manon Business Limited 75.0000 Ordinary

Hungary

Bocskai út 134-146, Budapest, H-1113, Hungary

RB (Hygiene Home) Hungary Kft Ordinary

Reckitt Benckiser Kereskedelmi Kft Partnership

Interest

Reckitt Benckiser Tatabánya Kft Ordinary

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

211 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

India

DLF Cyber Park, 6th & 7th Floor (Tower C), 405 B, Udyog Vihar Phase III, Sector 20,

Gurugram, Haryana, 122016, India

RB Hygiene Home India Private

Limited

Ordinary

Reckitt Benckiser (India) Private

limited

Equity

Reckitt Benckiser Healthcare India

Private Limited

99.9999 Ordinary

Unit No. 54, 5th Floor, Kalpataru Square, Andheri-Kurla Road, Andheri (East),

Mumbai, Maharashtra, 400059, India

Mead Johnson Nutrition (India)

Private Limited

Ordinary

Reckitt Piramal Private Limited 99.9999 Ordinary

Indonesia

Jl. Raya Narogong, Chamber A.I, Kel. Pasirangin, Kec Cileungsi, Kab. Bogor.

Provinsi. Jawa Barat, 16820, Indonesia

PT Reckitt Benckiser Trading

Indonesia

Ordinary

Treasury Tower 58th Floor, District 8, SCBD, Jalan Jendral Sudirman Kav 52-53,

Jakarta, 12190, Indonesia

PT Mead Johnson Indonesia 90.1000 Ordinary

PT Reckitt Benckiser Indonesia Ordinary

Pt. Reckitt Benckiser Hygiene

Home Indonesia

+ Ordinary

Pt. Reckitt Benckiser Hygiene

Home Trading Indonesia

+ Ordinary

Iran, Islamic Republic of

1st Floor, unit 11, No.88 Baran Building, Sayed Road, Opposite Mellat Park,

Vali-e-Asr Avenue, Tehran, Iran, Islamic Republic of

Reckitt Benckiser Pars PJSC Ordinary

Ireland

c/o TMF Group, Ground Floor, Two Dockland Central, Guild Street, North Dock,

Dublin 1, D01 K2C5, Ireland

Dorincourt Holdings (Ireland)

Limited

Ordinary

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser Ireland Limited Ordinary

Reckitt Benckiser Management

Services Unlimited Company

Ordinary-A,

B, C, D, E, F, G,

H, I, J K

6th Floor, 2 Grand Canal Square, Dublin 2, Ireland

RB Ireland Hygiene Home

Commercial Limited

Ordinary

Israel

6A Hangar Street, PO Box 6440, I.Z., Neve Nee’man B, Hod Hasharon, 457703, Israel

Reckitt Benckiser (Near East)

Limited

Ordinary

Italy

Via Spadolini 7, 20141, Milano, Italy

Reckitt Benckiser Commercial

(Italia) Srl

Quota

Reckitt Benckiser Healthcare (Italia)

S.p.A.

Ordinary

Reckitt Benckiser Holdings (Italia)

Srl

Quota

Reckitt Benckiser Italia SpA Ordinary

Japan

3-20-14 Higashi Gotanda, Shinagawa-ku, Tokyo, 141-0022, Japan

Reckitt Benckiser Asia Pacific

Limited

# –

Sumitomo Fudosan Takanawa Park Tower 14F, 3-20-14 Higashi-Gotanda,

Shinagawa-ku, Tokyo, 141-0022, Japan

Reckitt Benckiser Japan Ltd Ordinary

Jersey

44 Esplanade, St Helier, JE4 9WG, Jersey

SSL Capital Limited Ordinary

IFC 5, St. Helier, JE1 1ST, Jersey

Reckitt & Colman (Jersey) Limited Ordinary

Reckitt & Colman Capital Finance

Limited

Ordinary-A,

Ordinary-B

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser Jersey (No.3)

Limited

Ordinary

Reckitt Benckiser Jersey (No.5)

Limited

Ordinary

Reckitt Benckiser Jersey (No.7)

Limited

Ordinary,

Redeemable

Preference

– Class A/C/D

Kazakhstan

Bld. 15/A, Koktem-1, Almaty, 050040, Kazakhstan

Reckitt Benckiser Health

Kazakhstan LLP

Charter

Capital

Office 302, Building 15a, Koktem-1, Micro District, Almaty City, Kazakhstan

Reckitt Benckiser Kazakhstan LLP Ordinary

Kenya

14 Riverside Drive, Arlington Building, 3rd Floor, Nairobi, 209/19, Kenya

Reckitt Benckiser Health Kenya

Limited

Ordinary

LR.NO.1870/1/569, 2nd Floor, Apollo Centre, Ring Road Westlands, Kenya

Reckitt Benckiser Services (Kenya)

Limited

Ordinary

Plot 209/2462, Likoni Road, Nairobi, Kenya

Reckitt Benckiser East Africa

Limited

99.9899 Ordinary

Korea, Republic of

24th Floor, Two IFC, 10 Gukjegeumyung-ro, Youngdeungpo-gu, Seoul, 07326, Korea,

Republic of

Oxy Reckitt Benckiser LLC Capital

Contribution

Latvia

Strēlnieku iela 1A – 2, Rīga, LV-1010, Latvia

Reckitt Benckiser (Latvia) SIA Ordinary

Lithuania

Vilniaus m. sav. Vilniaus m. Olimpiečių g. 1A, Lithuania

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

212 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser (Latvia) SIA LT

filialas

# –

Luxembourg

1 Rue de la Poudrerie, Leudelange, L-3364, Luxembourg

Canterbury Square Holdings S.à.r.l Ordinary-A

RB Holdings (Luxembourg) S.à.r.l Ordinary-A

RB Holdings Luxembourg (2018)

S.à.r.l

Ordinary

Reckitt Benckiser Investments (No.

1) S.à.r.l

Ordinary

Reckitt Benckiser Investments (No.

2) S.à.r.l

Ordinary

Reckitt Benckiser Investments (No.

4) S.à.r.l

Ordinary

Reckitt Benckiser Investments (No.

5) S.à.r.l

Ordinary

Reckitt Benckiser Investments (No.

7) S.à.r.l

Ordinary

Reckitt Benckiser Investments (No.

8) S.à.r.l

Ordinary

Reckitt Benckiser S.à.r.l. Ordinary-A

Reigate Square Holdings S.à.r.l. Ordinary

Reckitt Benckiser N.V. # –

Reckitt Benckiser Holdings (USA)

Limited

# –

Malaysia

Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara,

Damansara Heights 50490, Wilayah Persekutuan, Kuala Lumpur, Malaysia

Mead Johnson Nutrition (Malaysia)

Sdn Bhd

Ordinary

RB (Health) Malaysia Sdn Bhd Ordinary

Reckitt Benckiser (Malaysia) Sdn

Bhd

Ordinary

Mexico

Av de las Granjas 972, Col. Santa Barbara, Azcapotzalco, CDMX, 02230, Mexico

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Manufactura MJN, S. de R.L. de C.V. Ordinary

Av. Ejército Nacional No.769, Corporativo Miyana Torre B, Piso 6, Alcaldía Miguel

Hidalgo, Colonia Granada, CP 11520, Mexico

Mead Johnson Nutricionales de

México, S. de R.L. de C.V.

Ordinary

RB Health México, S.A. de C.V. Ordinary-A,

Ordinary-B

RB Health Services, S.A. de C.V. Ordinary

Reckitt Benckiser Mexico, S.A. de

C.V.

Ordinary

Servicios Nutricionales Mead

Johnson S.de R.L. de C.V.

Ordinary

Calzada de Tlalpan No. 2996, Col. Ex Hacienda Coapa, Del. Coyoacán, Cd. de

México, C.P. 04980, Mexico

RB Salute Mexico S.A. de C.V. Ordinary

Circuito Dr Gustavo Baz, 7, No. 7, Fracc Industrial El Pedregal, Atizapan de

Zaragoza, Edomex, Mexico

Reckitt Benckiser Services S.A. de

C.V.

Ordinary

Morocco

59 Boulevard Zerktouni, Residence Les Fleurs 6eme étage, Casablanca, Morocco

Reckitt Benckiser Morocco SARL/

Ordinary

Netherlands

225 North Canal Street, Floor 25, Chicago IL IL 60606, United States

Mead Johnson One C.V. ◊ Membership

Interest

Mead Johnson Two C.V. ◊ Membership

interest

Schiphol Boulevard 267, 1118 BH, Schiphol, Netherlands

Reckitt Benckiser (ENA) B.V. Ordinary

Reckitt Benckiser Treasury Services

(Nederland) B.V.

Ordinary

Siriusdreef 14, 2132 WT, Hoofddorp, The Netherlands

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Beleggingsmaatschappij Lemore

B.V.

Ordinary

Central Square Holding B.V. Ordinary

Grosvenor Square Holding B.V. Ordinary

Hamol NL B.V. Ordinary

Maddison Square Holding B.V. Ordinary

MJN Global Holdings B.V. Ordinary

MJN Holdings (Netherlands) B.V. Ordinary

MJN Innovation Services B.V. Ordinary

New Bridge Holdings B.V. Ordinary

RB Hygiene Home Netherlands BV Ordinary

RB NL Brands B.V. Ordinary

Reckitt Benckiser (South America)

Holding B.V.

Ordinary

Reckitt Benckiser (Spain) B.V. Ordinary

Reckitt Benckiser Brands

Investments B.V.

Ordinary

Reckitt Benckiser Calgon BV Ordinary

Reckitt Benckiser Fabric Treatment

B.V.

Ordinary

Reckitt Benckiser Finish B.V. Ordinary

Reckitt Benckiser FSIA B.V. Ordinary

Reckitt Benckiser Healthcare B.V. Ordinary

Reckitt Benckiser Laundry

Detergents (No. 1) B.V.

Ordinary

Reckitt Benckiser Laundry

Detergents (No. 2) B.V.

Ordinary

Reckitt Benckiser Lime-A-Way B.V. Ordinary

Reckitt Benckiser Marc B.V. Ordinary

Reckitt Benckiser N.V. Ordinary

Reckitt Benckiser Oven Cleaners

Ordinary

Reckitt Benckiser Power Cleaners

B.V.

Ordinary

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

213 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser Tiret B.V. Ordinary

Reckitt Benckiser Vanish B.V. Ordinary

RB LATAM Holding B.V. Ordinary

Reckitt Benckiser Hygiene Home

Brands B.V.

Ordinary

New Zealand

2 Fred Thomas Drive, Takapuna, Auckland, 0622, New Zealand

RB (Hygiene Home) New Zealand

Limited

Ordinary

Reckitt Benckiser (New Zealand)

Limited

Ordinary

SSL New Zealand Limited Capital

contribution

Nigeria

12, 11th Floor Heritage Place, 21 Lugard Avenue Ikoyi, Ikoyi, Lagos State, Nigeria

Reckitt Benckiser Nigeria Limited Ordinary

Norway

Henrik Ibsens gate 60A, 0255 Oslo, Norway

RB Health Nordic, NUF # –

RB Hygiene Home Nordic NUF # –

Pakistan

Tenancy 04 & 05, 3rd Floor, Corporate Office Block, Dolmen City, HC, Block 4,

Scheme 5, Clifton, Karachi, 75600, Pakistan

Reckitt Benckiser Pakistan Limited 98.6846 Ordinary

Panama

Apartment 6G, 6th Floor, Edificio Bladex, Calle Avenida La Rotonda. Business Park,

Corregimiento de Juan Diaz, Urbanización Costa Del Este, Provincia De Panamá,

Distrito de Panama, Panama

Mead Johnson Nutrition (Panama),

S.de R.L.

Ordinary

Peru

Av. Republica de Panama # 2577, Urb. Santa Catalina, La Victoria, Lima, Peru

Reckitt Benckiser Peru S.A. Ordinary

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Calle Dean Valdivia No. 148, Torre 1, Ofic. 501, Urb. Jardín, San Isidro, Lima, Peru

RB Health Peru S.R.L Ordinary

Philippines

2309 Don Chino Roces Avenue Extension, Makati City, PH 1321, Philippines

2309 Realty Corporation 44.6606 Ordinary-A,

Ordinary-B

Mead Johnson Nutrition

(Philippines), Inc.

99.9996 Ordinary

Sphinx Holdings Company, Inc. 32.8125 Common,

Preference

3rd Floor Mead Johnson Nutrition Philippines Inc., 2309 Don Chino Roces Extension,

Makati City, 1231, Philippines

Reckitt Benckiser Healthcare

(Philippines), Inc.

99.9978 Common,

Preference

Poland

Nowy Dwór Mazowiecki, Ul. Okunin 1, 05-100, Poland

RB (Hygiene Home) Poland Sp.

Z.o.o.

Ordinary

Ul. Okunin 1, 05-100 Nowy Dwor Mazowiecki, Poland

Reckitt Benckiser (Poland) S.A. Ordinary

Reckitt Benckiser Production

(Poland) SP Z.o.o.

Ordinary

Ul. Wołoska 22, 02-675, Warsaw, Poland

Reckitt Business Services Sp. z.o.o. Partnership

Interest

Mead Johnson Nutrition Trading

Poland S.p z.o.o.

Membership

Interest

Portugal

Estrada Malhada dos Carrascos, 12, Porto Alto, 2135-061, Samora Correia, Portugal

Reckitt Benckiser Porto Alto Lda Quota

Rua D. Cristóvão da Gama, n.º 1, 1º, C/D, 1400-116, Lisboa, Portugal

Reckitt Benckiser (Portugal), S.A. Ordinary

Reckitt Benckiser Healthcare, Lda Quota

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Puerto Rico

Los Frailes Industrial Park, Ave. Esmeralda, Calle C # 475, Guaynabo, 00969,

Puerto Rico

Mead Johnson Nutrition (Puerto

Rico) Inc.

# –

Romania

Iancu de Hunedoara Boulevard, Nr. 48, 11th Floor, Crystal Tower Building, 1st

District, Bucharest, 011745, Romania

Reckitt Benckiser (Romania) S.R.L Partnership

Interest

Str. Grigore Alexandrescu 89-97, Aripa Vest, Et. 5, Finish room, Sect. 1, Bucuresti,

010624, Romania

RB (Hygiene Home) Romania S.R.L. Ordinary

Russian Federation

3rd Floor, 4 Shluzovaya emb., Zamoskvorechye Municipal district, Moscow, 115114,

Russia

Reckitt Benckiser Healthcare LLC Charter

Capital

Reckitt Benckiser IP LLC Charter

Capital

4 Shluzovaya emb., Zamoskvorechye Municipal district, Moscow, 115114, Russia

Reckitt Benckiser LLC Charter

Capital

Klin City, Tereshkovoy Street, 1, 14160052 /1, Moscow Region, Russian Federation

Branch of Reckitt Benckiser LLC in

city Klin, Moscow region, Russia

# –

Saudi Arabia

Office number 51, Fifth floor, Mukmal Plaza Center, Al Hamra District Palestine

Street, Jeddah City, Saudi Arabia

Reckitt Sanabil for Trading Co LLC 51.0000 Ordinary

Singapore

12 Marina Boulevard, #19-01 Marina Bay Financial Centre, 018982, Singapore

Mead Johnson Nutrition (Asia

Pacific) Pte. Ltd.

Ordinary

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

214 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Mead Johnson Nutrition (Singapore)

Pte. Ltd.

Ordinary

Mead Johnson Nutrition Holdings

(Singapore) Pte. Ltd.

Ordinary

Reckitt Benckiser (Singapore) Pte.

Limited

Ordinary

Slovakia

Drieňová 3, 821 08 Bratislava,

Slovakia

RB (Hygiene Home) Slovakia spol.

s.r.o

Ordinary

Reckitt Benckiser (Slovak Republic),

spol s.r.o.

Partnership

Interest

South Africa

Ground Floor, North Wing, Allandale Building, 39 Magwa Crescent, Waterfall City,

Midrand, Gauteng, 2090, South Africa

Reckitt Benckiser Pharmaceuticals

(Proprietary) Limited

Ordinary

Reckitt Benckiser South Africa

Health Holdings (Pty) Limited

Ordinary

Reckitt Benckiser South Africa

Proprietary Limited

Ordinary

Spain

Carrer de Mataró, 28, 08403, Granollers, Barcelona, Spain

Reckitt Benckiser Healthcare S.A.U. Ordinary-A,

Ordinary-B

Norwich Square Holdings S.L.U. Ordinary

RB Square Holdings (Spain) S.L. Ordinary-A,

Ordinary-B

Reckitt Benckiser (España), S.L.U Ordinary

Reckitt Benckiser (Granollers) SL Ordinary

Fray Carbo, 24, 08400, Granollers, Spain

Relcamp Aie + Ordinary

No. 151, Avda. Can Fatjó, Rubi, Barcelona, Spain

SSL Healthcare Manufacturing S.A.U + Ordinary

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Sri Lanka

No.25, Shrubbery Garden, COLOMBO-04, Sri Lanka

Reckitt Benckiser (Lanka) Limited 99.9991 Ordinary

Sweden

Box 190, 101 23 Stockholm, Sweden

SSL Healthcare Sverige AB Ordinary

c/o Reckitt Benckiser Nordic A/S, Danmark Filial, Regeringsqatan 29, 111 53,

Stockholm, Sweden

RB Health Nordic A/S, filial # –

Vretenvägen 2, 4th Floor, 171 54 SOLNA, Sweden

RB Hygiene Home Nordic A/S, filial # –

Switzerland

Richtistrasse 5, 8304 Wallisellen, Switzerland

RB Hygiene Home Switzerland AG Ordinary

Reckitt Benckiser (Switzerland) AG Ordinary

Reckitt Benckiser AG Ordinary

Taiwan

6F, No. 136, Sec. 3, Ren-Ai Rd., Da-An Dist., Taipei City 10, 10657, Taiwan

Reckitt Benckiser HK Limited

Taiwan branch

# –

8 of 6F, No. 205, Section 1, Dunhua South Road, Da’an District, Taipei, Taiwan

(Province of China)

RB & Manon Business Limited

Taiwan Branch

# –

Thailand

100 Moo 5, Bangsamak Sub-District, Bangpakong District, Chachoengsao Province

24180, Thailand

SSL Manufacturing (Thailand)

Limited

44.9999 Ordinary-A,

Ordinary-B

65 Moo 12 Lardkrabang-Bangplee Road, Bangplee Yai District, Bangplee,

Samutprakarn, 10540, Thailand

Reckitt Benckiser Healthcare

Manufacturing (Thailand) Limited

45.0000 Ordinary,

Preference

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

No. 388 Exchange Tower, 14th Floor, Sukhumvit Road, Klongtoey, Bangkok, TH 10110,

Thailand

Reckitt Benckiser (Thailand)

Limited

44.9999 Ordinary

Reckitt Benckiser Holding

(Thailand) Limited

45.0000 Common,

Preference

RB Hygiene Home (Thailand)

Limited

99.5749 Common

Mead Johnson Nutrition (Thailand)

Ltd

Common/

Equity

Turkey

Esentepe Mah., Büyükdere Cad., Tekfen Blok No:209/2, Şişli, İstanbul, Turkey

Reckitt Benckiser Ev ve Hijyen

Ürünleri Levent Şubesi

# –

Esentepe Mahallesi Büyükdere Caddesi Tekfen, Tower No: 209 A Blok D:2 34394 4.,

Levent, Şişli, İstanbul, Turkey

Reckitt Benckiser Temizlik

Malzemesi Sanayive Ticaret A.S.

Capital

Contribution

Orta Mahallesi Demokrasi, Caddesi Benckiser Sitesi No.92, Tuzla, Istanbul, Turkey

Reckitt Benckiser Ev ve Hjyen

Ürünleri A.Ş.

Capital

contribution

Ukraine

28A Stepana Bandery Prospect, Bld.G, Office 80., Kiev, 04073, Ukraine

Reckitt Benckiser Household and

Health Care Ukraine LLC

Charter

Capital

Reckitt Benckiser Hygiene Home

Ukraine LLC

Charter

Capital

40-Richchia Zhovtnia avenue, 120, 1 Block, Kyiv, 03127, Ukraine

Medcom Marketing and Prodazha

Ukraine LLC

Charter

Capital

United Arab Emirates

309, Floor 3, Dubai Science Park Labrotory Complex, Dubai, United Arab Emirates

Reckitt Benckiser Arabia # –

Al Seer Corporate Office, Behind Al Tayer Motors, Sheikh Zayed Road, Al Quoz

Industrial Area 3, Dubai, 31587, United Arab Emirates

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

215 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser Arabia Trading

LLC

48.6897 Ordinary

Level 27, Tower B, JAFZA One,Jebel Ali Free Zone, Dubai, PO Box 16834, United

Arab Emirates

RB Hygiene Home Arabia FZE Ordinary

Reckitt Benckiser Arabia FZE 51.2555 Ordinary

Office 1801, 1803, 1804, Emaar Real Estate Burj Khalifa, Dubai, United Arab

Emirates

Reckitt Benckiser (RUMEA) Limited

– Dubai Branch

# –

Unit 05, Level 3, Gate Village Building 04, Dubai Investment Financial Centre, PO

BOX 677, United Arab Emirates

RB Investment Company Limited 0.5000 Ordinary-A,

Ordinary-B

United Kingdom

103-105 Bath Road, Slough, Berkshire, SL1 3UH, United Kingdom

103-105 Bath Road Limited

(Company number: 07415344)

* Ordinary

Access VC Limited 70.5900 Ordinary,

Preference

Benckiser Ordinary,

Bonus

Crookes Healthcare Limited Ordinary,

Bonus

Cupal, Limited Ordinary,

Bonus

Dakin Brothers Limited Ordinary,

Bonus

Durex Limited Ordinary

eRB Trading Limited Ordinary

FF Homecare & Hygiene Limited 70.5882 Ordinary,

Preference

Glasgow Square Limited Ordinary,

Bonus

Green,Young & Company Limited Ordinary,

Bonus

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Hamol Limited Ordinary,

Bonus

Helpcentral Limited Ordinary,

Bonus

Howard Lloyd & Company,Limited

(Company number: 00124747)

* Ordinary

LI Pensions Trust Limited Ordinary

Linden Germany A Limited Ordinary

Linden Germany B Limited Ordinary

Lloyds Pharmaceuticals Ordinary,

Bonus

London International Group Limited

(Company number: 00488344)

* Ordinary B

LRC Products Limited Ordinary

LRC Secretarial Services Limited Ordinary

MJ UK Holdings Limited Ordinary

MJN International Holdings (UK),

Ltd.

(Company number: 10773207)

* Ordinary

Nurofen Limited Ordinary

Optrex Limited

(Company number: 00301618)

* Ordinary

Pharmalab Limited Ordinary,

Bonus

R&C Nominees Limited

(Company number: 03646801)

* Ordinary

R&C Nominees One Limited Ordinary

R&C Nominees Two Limited Ordinary

RB (China Trading) Limited 80.0000 Ordinary

RB Asia Holding Limited Ordinary

RB Holdings (Nottingham) Limited

(Company number: 04367123)

* Ordinary,

Bonus

RB Luxembourg (2016) Limited

(Company number: 10490698)

* Ordinary

RB Luxembourg Holdings (TFFC)

Limited

Ordinary

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

RB Mexico Investments Limited

(Company number: 10141275)

* Ordinary

RB Reigate (2019) Ltd. Ordinary

RB Reigate (UK) Limited Ordinary,

Bonus

RB UK Commercial Limited Ordinary

RB UK Hygiene Home Commercial

Limited

Ordinary

RB USA (2019) Ltd. Ordinary

Reckitt & Colman (Overseas) Health

Limited

Ordinary

Reckitt & Colman (Overseas)

Hygiene Home Limited

Ordinary

Reckitt & Colman (Overseas)

Limited

(Company number: 00593047)

* Ordinary

Reckitt & Colman (UK) Limited

(Company number: 00341605)

* Ordinary,

Irredeemable

Cumulative

Preference

Reckitt & Colman Holdings Limited Ordinary,

Bonus

Reckitt & Colman Pension Trustee

Limited

Ordinary

Reckitt & Sons Limited

(Company number: 00561576)

* Ordinary

Reckitt Benckiser (Brands) Limited Ordinary

Reckitt Benckiser (Grosvenor)

Holdings Limited

(Company number: 05698731)

* Bonus

Reckitt Benckiser (Health) Holdings

Limited

Ordinary

Reckitt Benckiser (Hygiene Home)

Holdings Limited

Ordinary

Reckitt Benckiser (RUMEA) Limited Ordinary

Reckitt Benckiser (UK) Limited Ordinary

Reckitt Benckiser (USA) Limited Ordinary

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

216 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser Asia Pacific

Limited

Ordinary

Reckitt Benckiser Corporate

Services Limited

Ordinary

Reckitt Benckiser Expatriate

Services Limited

Ordinary

Reckitt Benckiser Finance (2005)

Limited

Ordinary,

Bonus

Reckitt Benckiser Finance (2007) Ordinary

Reckitt Benckiser Finance (2010)

Limited

(Company number: 07415340)

* Ordinary,

Bonus

Reckitt Benckiser Finance Company

Limited

(Company number: 04749202)

* Ordinary

Reckitt Benckiser Health Limited Ordinary

Reckitt Benckiser Healthcare

(Central & Eastern Europe) Limited

(Company number: 03368448)

* Ordinary

Reckitt Benckiser Healthcare (CIS)

Limited

(Company number: 03376759)

* Ordinary

Reckitt Benckiser Healthcare

(MEMA) Limited

Bonus

Reckitt Benckiser Healthcare (UK)

Limited

Ordinary

Reckitt Benckiser Healthcare

International Limited

Ordinary

Reckitt Benckiser Holdings

(Channel Islands) Limited

# –

Reckitt Benckiser Holdings

(Luxembourg) Limited

Ordinary

Reckitt Benckiser Holdings

(Overseas) Limited

(Company number: 04617051)

* Ordinary

Reckitt Benckiser Holdings (TFFC)

Limited

Ordinary,

Bonus

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser Holdings (USA)

Limited

(Company number: 04906543)

* Ordinary

Reckitt Benckiser Jersey (No.3)

Limited

# –

Reckitt Benckiser Jersey (No.5)

Limited

# –

Reckitt Benckiser Investments

Limited

Ordinary,

Bonus

Reckitt Benckiser Limited Ordinary

Reckitt Benckiser Luxembourg

(2010) Limited

(Company number: 07323959)

* Ordinary

Reckitt Benckiser Luxembourg

(No.1) Limited

Ordinary

Reckitt Benckiser Luxembourg

(No.2) Limited

Ordinary

Reckitt Benckiser Luxembourg

(No.3) Limited

Ordinary,

Bonus

Reckitt Benckiser Luxembourg

(No.4) Limited

Ordinary,

Bonus

Reckitt Benckiser Service Bureau

Limited

(Company number: 03605068)

* Ordinary

Reckitt Benckiser Treasury (2007)

Limited

(Company number: 06365837)

* Ordinary-B

Reckitt Benckiser Treasury Services

plc

Ordinary

Reckitt Benckiser Treasury Services

(Nederland) B.V.

# –

Reckitt Benckiser USA (2010) LLC # –

Reckitt Benckiser USA (2013) LLC # –

Reckitt Benckiser USA Finance

(No.1) Limited

(Company number: 04902703)

* Ordinary

Reckitt Benckiser USA Finance

(No.2) Limited

(Company number: 04902747)

* Ordinary

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Reckitt Benckiser USA Finance

(No.3) Limited

(Company number: 04902776)

* Ordinary

Reckitt Colman Chiswick (OTC)

Limited

(Company number: 00593046)

* Ordinary,

Bonus

Reckitt Seton Limited

(Company number: 01914860)

* Ordinary,

Convertible,

Cumulative

Preference

Reckitt Sonet (UK) Limited

(Company number: 02285039)

* Ordinary

Scholl Consumer Products Limited Ordinary

Sonet Dormant Company No.1

Limited

(Company number: 00220272)

* Ordinary,

Deferred

Sonet Investments Limited Ordinary,

Bonus

Sonet Overseas Investments

Limited

Ordinary,

Bonus

Sonet Prebbles Limited

(Company number: 00710779)

* Ordinary

Sonet Products Limited Ordinary

Sonet Seton UK Limited Ordinary

SSL (MG) Polymers Limited Ordinary

SSL (RB) Products Limited Ordinary

SSL International plc Ordinary

SSL Products Limited

(Company number: 01026788)

* Bonus

Tubifoam Limited Ordinary,

Bonus

W.Woodward, Limited Ordinary

United States

2400 W. Lloyd Expressway, Evansville IN 47721, United States

Mead Johnson & Company, LLC Ordinary

Mead Johnson Nutrition Company Ordinary

399 Interpace Parkway, Parsipanny NJ 07054, United States

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

217 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTSSTRATEGIC REPORT GOVERNANCE OTHER INFORMATION

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Biofreeze IP Holdings, LLC Membership

Interest

Blisa, LLC Ordinary

Exponential Health LLC Ordinary

Lanai Holdings 1.5, Inc. Common

Mead Johnson Nutrition

(Dominicana) S.A.

Ordinary

Mead Johnson Nutrition

(PuertoRico) Inc.

Ordinary

Mead Johnson Nutrition

(Venezuela) LLC

Ordinary

Mead Johnson Nutrition Nominees

LLC

Membership

Interest

MJ USA Holdings LLC Ordinary

MJN Asia Pacific Holdings LLC Ordinary

MJN U.S. Holdings LLC Ordinary

RB Health (US) LLC Ordinary

RB Health Manufacturing (US) LLC Ordinary

Reckitt Health Pain (US) LLC Ordinary

TheraPearl LLC Ordinary

Corporation Service Company, 251 Little Falls Drive, Wilmington, New Castle

County DE 19808, United States

LRC North America Inc. Common/

Equity,

Preference

RB Manufacturing LLC Ordinary

RB USA Holdings LLC Ordinary

Reckitt Benckiser LLC Ordinary

Reckitt Benckiser USA (2010) LLC Ordinary

Reckitt Benckiser USA (2012) LLC Membership

Reckitt Benckiser USA (2013) LLC Ordinary

SSL Holdings (USA) Inc. Ordinary

Notes to the Parent Company Financial Statements continued

12 Subsidiary Undertakings continued

Entity name Key

Overall % owned by

Group, if not 100%

Share class

name(s)

Venezuela, Bolivarian Republic of

251 Little Falls Drive, Wilmington DE 19808, United States

Mead Johnson Nutrition Venezuela

SCA

# ◊ –

Avenida Mara con Calle San José, Centro Comercial Macaracuay Plaza, Nivel C3,

Locales 5 y 12. Urb. Colinas de la California., Caracas, Venezuela, Bolivarian

Republic of

Reckitt Benckiser Venezuela S.A. Ordinary

Urb. Las Mercedes, Av. Orinoco cruce con Mucuchies Torre Nordic, Piso 1, Oficina 1 y

2, Municipio Baruta Caracas, Venezuela, Bolivarian Republic of

Mead Johnson Nutrition Venezuela,

S.C.A.

Partnership

Interest

Vietnam

Suite 402, 4th Floor, No. 235 Dong Khoi Street, Ben Nghe Ward, District 1, Ho Chi

Minh City, Vietnam

The Representative Office of

Reckitt Benckiser (Thailand) Ltd in

Ho Chi Minh City

# –

Unit 401, 4th Floor, Metropolitan Building, No. 235 Dong Khoi Street, Ben Nghe

Ward, District 1, Ho Chi Minh City, Vietnam

Mead Johnson Nutrition (Vietnam)

Company Limited

Capital

Contribution

+ In liquidation * Audit exemption # Branch ◊ Registered office different to country of registration

Key

218 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Climate-Related Financial Disclosures

In addition to these Climate-related Financial Disclosures, we provide further information on our

environmental performance and greenhouse gas emissions on page 48. We consider the potential

financial impacts of climate change in the scenario modelling within our Viability Statement on page 61

and impairment/intangibles note on page 173-177. Comprehensive detail on our scenario modelling can

befound in our Basis of Reporting Criteria available at www.reckitt.com/reporting-hub.

Governance

Board oversight

The Board, supported by the Corporate Responsibility, Sustainability, Ethics and Compliance (CRSEC)

Committee, oversees sustainability, including climate-related risks and opportunities. The Board

receivesquarterly updates on sustainability matters from the CRSEC Committee, including progress and

performance against Reckitt’s climate targets. Sustainability, including climate risk, is considered as part

of the Board’s annual review of our principal and emerging risks alongside at least an annual review of our

Sustainability Ambitions. In November, the Board also held a listening session on the impacts of climate

change on global health.

for more detail on our governance framework and mechanisms, remuneration policy and the CRSEC Committee’s activities during the year.

See pages 71-82 See pages 96-99

Management’s role

Our CEO is accountable for sustainability matters, including climate-related risks and opportunities.

TheGroup Risk, Sustainability and Compliance Committee (RSCC) is chaired by the CEO and supported

by business unit-level committees who meet and report quarterly.

Our sustainability ambitions are delivered through the Group Executive Committee (GEC) and

management team who are responsible for ensuring adequate action plans and investment are in place.

The Corporate Affairs and Sustainability function leads sustainability-related strategy development and

compliance. Programmes to meet our operational and product footprint targets are implemented by our

Brands, Supply Chain, R&D, and Safety, Quality and Regulatory Compliance teams. Following Kris Licht’s

appointment as CEO on 1 October, the GEC conducted a deep dive on Reckitt’s carbon footprint to build

awareness and understanding across the Group and agree the key steps needed to deliver on Reckitt’s

Sustainability Ambitions, specifically on Scope 3 emissions. We identified three cross-functional priorities

across IT and Data, Procurement and R&D/Innovation to help accelerate progress. These include the

enhanced capture and visibility of supplier and materials carbon data, conducting feasibility studies

onthe use of alternative and new materials, and further developing our carbon reduction roadmaps.

We conduct monthly environmental reporting at site, regional and functional level. Progress against our

targets is reviewed monthly at supply chain leadership forums and quarterly through business unit and global

business risk reviews, enabling us to manage activity and deal with emerging issues on an ongoing basis.

Supporting these formal management structures are cross-functional steering committees who provide

governance and oversight across key transition risks and sustainable product activities.

Risk management

Reckitt operates an integrated company-wide risk management process for financial and non-financial

risks performed at the functional, business unit and corporate levels. Sustainability, including the risk

ofclimate-related impacts, was first identified as a principal risk in 2019 and is considered in our annual

Group risk assessment within ‘ESG transition risk’, which includes the identification and monitoring

ofpotential impacts, mapping current controls and developing action plans.

The Group principal and emerging risk assessment is part of our integrated risk management

framework,identifying the principal and emerging risks with the greatest potential to have a substantive

or strategic impact on the Group. The assessment is completed annually in advance of the business

unitand corporate strategic planning process, taking into consideration the outcomes of detailed risk

assessments conducted in specific areas throughout the year, for example, climate-related physical and

transition risk scenario analysis. Additionally, through our ESG issues materiality assessment, sustainability

risks are reviewed every two to three years. Operational risks are assessed across sites through annual

global asset and environmental risk reviews. Our progressive work on decarbonisation, product

innovation and supply chain resilience help mitigate these risks. Within specific climate-related financial

risks we undertake arange of analysis, evaluation and mitigation activities summarised in this report.

for more detail on the group’s risk management approach and updates during the year.

See pages 55-56

Since 2018, we have conducted scenario analyses to consider the longer-term impacts of climate change

on our business and support our modelling of climate risks in greater detail (see below). We consider

physical and transition risks from climate change over the short term (up to three years) in line with our

Group risk assessment, over the medium term (three to five years) in line with our strategic planning

cycle, and over the longer term (10 years+) in line with the useful life of the brand intangible assets,

through our work with Risilience and Cambridge Centre for Risk Studies. The Risilience climate and

enterprise analytics technology provides quantitative analytics that inform risk management and

decision-making across our brands and wider organisation. This has helped extend existing corporate

risk management activity on business continuity, which might be created in terms of extreme weather

events and which are also considered in our climate risk activity.

The Risilience analysis provides quantitative earnings value at risk estimations across risk categories

overa five- and 10-year timeframe which supports financial and operational planning. We focus

activitythrough routine business and financial planning within our brands and supply chain, in annual

andthree-year cycles, in order to manage risks and deliver against our Sustainability Ambitions.

Monitoring emerging policy and regulatory frameworks, together with financial tracking of fiscal

policyrequirements on taxation, informs our planning activity and response to address transition

risksfrom climate-related policy. We continue to track litigation, functionally and within our

businessunits and markets, and are monitoring emerging regulations on climate-related reporting

anddisclosurerequirements.

219 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Climate-Related Financial Disclosures continued

During the year, we continued to enhance and refine our climate risk analysis by increasing the breadth

and depth of data in the digital twin of our business, specifically in relation to our product categories

andraw materials footprint, while also further embedding the management of climate-related risks

andopportunities into our enterprise risk management processes. We have reviewed the Group’s

physical and transition risks and opportunities, and quantified the financial values at risk.

Strategy

We remain committed to delivering our science-based targets and working towards becoming net zero

by 2040. Our Sustainability Ambitions are embedded into our business strategy for growth, and support

both resilience and opportunity for our operations and brands.

Climate scenario analysis

Our approach to understanding climate-related risks and opportunities is underpinned by our scenario

analysis. In partnership with Risilience, we continued to develop our internal data-driven model of the

business (or ‘digital twin’) which captures Reckitt’s commercial and physical footprint and allows us to

assess the impact of the five climate scenarios specified by the Intergovernmental Panel on Climate

Change’s (IPCC) Sixth Assessment Report for both physical and transition risks (SSP1–SSP 8.5). SSP1-1.9

(1.5°C) represents the most rapid transition pathway as extreme actions are taken to reduce emissions

globally with widespread policy changes to achieve net zero by 2050. SSP3-7.0 (3°C) is defined by

theclimate-related policies in place today i.e. if no further policy action is taken. These two pathways

highlight the variation in risks and opportunities in meeting our science-based targets by 2030 and

netzero ambition by 2040.

for detail on the modelled pathways used at reckitt.com/reporting-hub.

See our Basis of Reporting Criteria

We modelled the potential impact of five transition risks derived from policy development, consumer

preference change, investor sentiment, asset liabilities, climate activism and litigation, together with

acute and chronic physical risks to the value chain, including disruption to our direct and upstream

operations and the supply of natural raw materials. Specifically, we model the potential financial impacts

of climate change by region, product, facility and hazard i.e. drought, flooding, heatwave. The output

provides a five-year, quantitative earnings value at risk estimation across risk categories and a long-term

qualitative risk outlook up to 20 years. For the purposes of our disclosure, we aggregate and present

consolidated results for the Group global business. The potential material earnings value at risk is quoted

as a range reflecting the uncertainty and assumptions associated with climate-related modelling.

Climate-related risks and opportunities over the short, medium and long term

We assume that all aspects of our value chain will be susceptible to climate-related transition and

physical risks to varying degrees. This is accounted for within our potential earnings value at risk

estimations which represent gross risk for the Group as a whole.

Short to medium term

From our analysis over the past three years, two of the modelled transition risk categories (consumer

market and policy risk) consistently emerge as having the greatest potential impact in the short to

medium term, specifically from changing consumer preference in favour of low impact products and

policy-driven carbon price increases, both of which are greatest in a 1.5°C scenario. Potential risks and

opportunities identified include energy and commodity cost rises across our operations, upstream and

downstream value chain. A more likely phased policy approach and changes in consumer preference,

alongside our ongoing mitigation activity to reduce emissions across our supply networks and innovation

in more sustainable products, would not be material for Reckitt. Physical risk represents a significantly

smaller proportion of total earnings value than transition risk.

Long term

In the longer term, we expect increases in the frequency and severity of extreme weather events, water

stress and higher ambient temperatures to impact our global sites, supply networks and consumer value

chains. Changes to regional climates may lead to a reduction in the availability of natural raw materials

and associated costs and the nature of products that are most viable in certain regions may change.

Theaggregate impact of all modelled physical risks is currently not material.

The tables on page 220 summarise the potential earnings value at risk associated with our modelled risks

over the short to medium term (up to five years) and a qualitative assessment of how these risks could

evolve over the longer term (10 to 20 years). The modelled impacts are based on a 1.5°C pathway aligned

to the Paris Ambition and a 3°C pathway aligned to current policy which are considered to represent

abest and worst case scenario.

Consumer market risk

This risk models the impact of changing consumer preferences and sustainable purchasing trends.

Itconsiders the potential uptake rates of consumers transitioning from conventional to less emissions-

intensive products and services, including single use vs reusable packaging, organic vs chemical

cleaners, concentrates, and dairy vs alternative proteins. The 1.5°C pathway assumes a fast adoption of

sustainable alternatives and a significant reduction in consumer demand for less sustainable and more

carbon intensive products, whereas the 3°C pathway assumes a limited reduction in current demand.

There is potential for Reckitt brands to be variably exposed to demand loss, depending on the

environmental impact of products (including raw material composition, manufacturing and consumer

use). While we continue to see increased consumer interest in more sustainable products, there remains

a ‘say-do’ gap for the vast majority, with consumers remaining focused primarily on value and efficacy.

This exposure therefore has negligible current impact. Nonetheless, our sustainable product innovation

programme continues to inform our product development pipeline and supports our ambition for 50%

ofnet revenue to be derived from more sustainable products by 2030. Using our Sustainable Innovation

Calculator to inform new and existing product development helps us design for lower carbon and water

footprints in use, which mitigates physical risks in the marketplace and helps us to meet emerging

consumer preferences. Further details on our approach to innovation can be found on pages 22-24.

220 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Climate-Related Financial Disclosures continued

The risk values below represent gross risk to the Group and assume none of the mitigating actions

outlined above are in place.

Pathway

Unmitigated

potential

annual impact

5-year horizon

5–10-year modelled scenario impacts

andassumptions

10–20-year modelled scenario impacts

andassumptions

3°C Not material – Conventional shopping preferences continue, with existing levels of

uptake for sustainable options continuing, resulting in only minimal

decline in demand for conventional products

1.5°C £0–£130m – Consumers increasingly switch

from non-sustainable products

tomore sustainable options

– Low-carbon alternative

productsprogressively increase

market share, supported by

policy frameworks including

carbon labelling

– Market demand for sustainable

products and services

becomesmainstream

– As we move towards 2050,

consumer habits have to shift

more dramatically to meet global

emissions reduction targets

Other transition and physical risks

Other modelled risk categories include:

– Policy risk – an increase in future carbon pricing where carbon pricing policies (either emissions

trading systems or carbon taxes) are implemented variably in all jurisdictions

– Technology risk – the risk of asset impairment under different climate-related economic transitions

– Investor sentiment – the risks and effects stemming from changes to the discount rate, relative

totheeconomic sector, transition pathway, debt and equity structure

– Litigation/Reputation – the potential for litigation or civil/criminal penalties for a company’s

climate-related activities, including greenwashing and pollution, and the risk of consumer boycotts

– Market disruption – the disruption to sales due to customer demand fluctuations induced by

regional-scale climate threats including heatwaves, droughts and freezes

– Facility disruption risk – the risk of physical damage to assets from extreme weather events, financial

losses from stock, contents and buildings damage, and operational disruption due to the reduction

incapacity

– Raw materials supply risk – changes in the supply of raw materials under the influence of a changing

climate and the potential impact of decreases in yield

Individually, these modelled risk categories are not material to our business under the five

scenariosassessed. The aggregate potential impact of these risks manifesting in a 1.5°C pathway

(whichrepresents a worst-case-scenario) is outlined below. The risk values below represent gross

risktothe group and assume no mitigating actions are in place.

Pathway

Unmitigated

potential

annual impact

5-year horizon 5–10-year modelled scenario impacts andassumptions

10–20-year modelled scenario

impacts and assumptions

3°C Not

material

– Carbon prices remain between $5-8 ($/tCO

e) up to 2050, with inconsistent

global implementation. Sectors covered by policies today remain static and

arenot expanded

– Inaction by governments and corporates results in an acceleration of climate

change, increasing public and consumer activism is used as a mechanism for

corporate accountability

– Exposure to climate-related litigation varies depending on historical emissions

responsibility and the extent of current commitment and action on addressing

future emissions

– The ‘consumer staples’ sector experiences relatively low exposure to risk

capital flight during economic transition

– Local distribution of goods from warehouse to point of sale is disrupted and/or

consumer demand fluctuates as a result of climate-related weather events

– Increase in the severity of climate hazards and extreme weather events

including heatwaves, freezes, droughts, flooding and windstorms

– Raw materials production fluctuates as a result of climate variability

andlong-term climate change

1.5°C £0–£130m – Carbon prices increase to $83 ($/tCO

e) over the

next five years, radical action by governments to

reduce emissions, driven by carbon price mechanisms

– Assets intrinsically linked to the use of fossil fuels

become impaired in direct proportion to the rate

atwhich fossil fuels are phased out

– Public sentiment towards climate change remains

strong and persistent and decarbonsation pathways

are met or exceeded without major disruption to

economic activity. ‘Consumer staples’ sector

experiences relatively low exposure to risk capital

flight during economic transition

– Radical action by

governments to

reduce emissions,

driven by carbon

price mechanisms.

Carbon prices

increase significantly,

with rapid adoption

across developed

economies

221 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Climate-Related Financial Disclosures continued

Impact on business, strategy and financial planning

The rate of global decarbonisation and implementation of associated policy frameworks are critical

determinants of the magnitude of climate-related impacts on Reckitt.

We are actively working to reduce our GHG emissions in line with our 2030 reduction targets for

Scopes1and 2 and our total product carbon footprint, and our commitment to achieving net zero by

2040. Our net zero roadmap identifies where we are targeting decarbonisation opportunities in our

operations, products and value chain. Raw materials and packaging account for around 60% of Reckitt’s

carbon footprint. Downstream logistics in our control account for 12% and retail (including customer

operations, customer travel and e-commerce) accounts for 17%. The complexity of our global value

chainrequires multiple interventions with our suppliers and customers to decarbonise. Specifically,

weare focusing on several initiatives to reduce CO

e in materials by:

– targeting suppliers to use renewable energy in their operations;

– using less ingredients while maintaining the efficacy of products;

– using alternative ingredients with a lower CO

e footprint. Such substitution may take longer ifdifferent

ingredients require qualification, particularly in regulated products;

– reducing the water in our products by developing concentrates which reduces the transport footprint

and packaging use; and

– using recycled materials – our targeted switch to 25% PCR and using less virgin plastic will deliver CO

savings that we will model across the value chain.

This activity contributes to reducing our exposure to increases in carbon pricing and other transition

related risks. We have assumed that together with shifts in consumer behaviour and general market

pricing we are able to mitigate the risks identified above.

Our strategy concentrates on three key areas:

1. Our operations

Optimising our processes to reduce carbon emissions through continued and increasing support for

renewable electricity and low-carbon energy

For Scopes 1 and 2, we are targeting progressive improvements in carbon reduction. Switching from gas

in low-mid thermal energy needs is a near-term focus alongside the continued sourcing of renewable

electricity. Energy efficiency is now considered a business-as-usual focus more than a driver of carbon

reduction. Capital allocation for environmental improvements on carbon are built into current planning

and progress is reviewed monthly.

Potential damage to assets and the frequency of such events arising from extreme weather and other

potential climate-related events (including associated remediation costs) are reviewed through our risk

management and business continuity programmes, and connect into our financial programmes on

insurance. Site location planning and building design considers temperature, adverse weather and water

stress risks. Additionally, water stress risks are mitigated by our water efficiency and catchment area

management activity, which aims for all sites in water-stressed locations to be water positive by 2030.

Further details on our wider environmental targets and performance can be found on pages 48-50.

2. Product innovation

Meeting emerging consumer demand for more sustainable products, developing products that are

well placed for a low-carbon, low-water policy and physical environment, alongside increased use

ofrecycled and recyclable materials

A range of tools assesses climate-related factors across the product lifecycle from material sourcing to

consumer use, as part of our innovation process. These provide insights into the climate-related risks and

opportunities associated with our products via our Sustainable Innovation Calculator, which help steer

our R&D teams during development of new, more sustainable products. The calculator considers water

and carbon footprint, plastics and packaging, and ingredients metrics. Such product innovation provides

opportunity for growth, by meeting emerging consumer demands and expectations and developing

products that are well placed for emerging fiscal policy and physical environments.

3. Supply chain resilience

Building more resilient supply chains at site level and for key natural raw materials, and engaging

oursuppliers to help measure, track and reduce supplier-related carbon emissions

Our procurement teams continually review supply chains to mitigate the impact of commodity cost rises.

In the longer term, this may also involve the use of alternative ingredients and materials with evaluation

and development through our R&D function. We are also working directly with copackers through our

partnership with Manufacture 2030 to help them measure and progressively reduce their emissions

which will build resilience to physical and transition risks from climate change both within our supply

chain, and for our suppliers. Further details on how we’re building supply chain resilience can be found

onpages 25-27.

Our overall carbon footprint has reduced year-on-year reflecting changes in volume and product mix,

alongside a review of the modelled footprint in our retail channels. Overall, our principle remains to abate

first, and offset last, meaning that we remain focused on reducing the footprint of our operations and

products in the first instance. We are however, considering appropriate carbon market management

approaches for the longer term. Our existing Trees for Change programme was our first step in this

programme, securing four million tonnes of carbon via afforestation projects. We will evaluate similar

opportunities during 2024.

222 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONGOVERNANCESTRATEGIC REPORT

Resilience of strategy to different climate scenarios (including 2°C or lower)

Collective climate change impacts may present risks to Reckitt’s activity, however our strategy, targets,

activity and progress help mitigate these risks, build resilience and create opportunities. Our targets

for50% of net revenue to be derived from more sustainable products, 50% product footprint reduction,

and 65% reduction in operational carbon emissions, all by 2030, collectively enable Reckitt’s brand

portfolio and supply chain to become more resilient.

We have assessed that the modelled scenarios and associated climate-related risks outlined above are

not material to ongoing business operations, and that our business has an increasingly strong resilience

across a spectrum of scenarios, including one where warming is limited to 1.5°C. This assessment is

based on a number of factors, which include:

– the strength of our market-leading portfolio of health, hygiene and nutrition products and core

capabilities in adapting and innovating our existing ranges while launching new products to meet

emerging consumer demands;

– an active programme to improve the carbon, water, plastic, chemical and packaging footprint of our

products (more sustainable products) which accounts for 29.6% of net revenue and which we continue

to grow; and

– an extensive global and geographically diverse sourcing base characterised by strong and established

strategic relationships with suppliers, which gives us a natural hedge against weather extremities.

Metrics and targets

We have considered all cross-industry climate-related metrics set out in the TCFD All Sector guidance.

The metrics set out below are those considered to be material.

GHG emissions

Reckitt has established sustainability metrics and targets to drive performance on climate change in

areas both directly controlled and across our value chain, including two science-based targets (SBT):

1. reduce our product carbon footprint by 50% by 2030 versus 2015

2. reduce absolute Scope 1 and 2 GHG emissions by 65% by 2030 versus 2015

Supporting these goals is our commitment to RE100 and increasing the use of renewable electricity

to100% by 2030, improving energy efficiency for gas use across our operations.

for more information on our net zero, emissions, energy, water, waste and packaging performance, and our GHG emissions data,

including Scopes 1, 2 and selected Scope 3 disclosures.

See pages 48-50

Climate-related physical and transition risks and opportunities

Please refer to pages 219-220.

Capital deployment and internal carbon pricing

We are currently considering an internal carbon pricing approach, which will allow us to strengthen the

assessment of climate impact in future investment decisions.

Remuneration

Since 2022, our Long Term Incentive Plan (LTIP) has included net revenue from more sustainable products

(which includes our product carbon footprint and reduction in GHG emissions from our operations,

seepage 125). The CEO and CFO’s bonus opportunities are based on the delivery of Reckitt’s strategy,

including progress against our 2030 Sustainability Ambitions as a whole, see pages 112-114. For more

information on remuneration measures see page 104.

Other metrics

– We track stakeholder sentiment through routine dialogue and engagement with our key

stakeholdersincluding investors, customers and NGOs. See more in the stakeholder section on

pages37-40. We strive to maintain and improve our performance in external benchmarks and ratings,

including MSCI, Sustainalytics and CDP Climate

– We track consumer spending patterns through sales data and broader consumer insight and research

at brand and sector level, which informs our product innovation programme and R&D pipeline

Next steps

Our priorities in 2024 will include further in-depth analysis of consumer market risk across our product

categories and markets, increasing the breadth and depth of data-driven analysis across the supply chain

to better identify and mitigate emissions-intensive activities, and continued development of internal

capabilities. Our product innovation programme has a heightened focus on product carbon emissions

reduction and we are using the Transition Plan Taskforce framework, Science Based Targets initiative

(SBTi) and Forest, Land and Agriculture (FLAG) guidance to guide our actions.

Listing Rule 9.8.6R Compliance Statement

Reckitt plc has complied with the requirements of LR 9.8.6R by including applicable and material

climate-related financial disclosures in this section (and by reference as indicated), consistent

withtheTCFD recommendations. We consider our disclosure to be consistent with all the TCFD

Recommendations and Recommended Disclosures including section C of the 2021-TCFD Annex entitled

‘Guidance for all Sectors’ and section E of the TCFD Annex entitled ‘Supplemental Guidance for Non-

Financial Groups’.

Climate-Related Financial Disclosures continued

223 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Alternative Performance Measures

The Annual Report and Accounts include financial information prepared in accordance with International

Financial Reporting Standards (IFRS Accounting Standards) as well as information presented on an

adjusted (non-IFRS) basis.

Financial information presented on an adjusted basis excludes certain cash and non-cash items. These

items have a pattern of recognition that is largely uncorrelated with the trading performance of the

business. Management reviews the business on this basis for the purpose of making operating decisions

and showing these adjusted measures in addition to the IFRS measures provides useful additional

information on trading performance to the users of the Financial Statements. These adjusted measures

should not be considered in isolation from, as substitutes for, or superior to the financial measures

prepared in accordance with IFRS.

The following items (adjusting items) are excluded from IFRS earnings in calculating adjusted earnings.

– Impact of business combinations, and similar purchases of equity, where IFRS accounting results

intherecognition of certain costs that are not comparable with those for internally generated assets,

(although the net revenues and other costs of these business combinations are not adjusted for):

• amortisation of (a) acquired brands, trademarks and similar assets and (b) certain other intangible

assets recorded as the result of a business combination;

• inventory fair value adjustments;

• professional and advisor costs recorded as the result of a business combination;

• changes in the amount of consideration paid or expected to be paid (including changes in fair value)

and associated tax impacts; and

• changes to deferred tax liabilities relating to (a) acquired brands, trademarks and similar assets and

(b) certain other intangible assets recorded as the result of a business combination as the

amortisation or profit on disposal of these brands would be treated as an adjusting item

– Profits or losses relating to the sale of brands and related intangible assets as the continued active

management of our portfolio results in the recognition of profits or losses relating to disposals of

brands and related intangible assets which are largely uncorrelated with the trading performance

ofthe business

– Re-cycled foreign exchange translation reserves upon the sale, liquidation, repayment of share

capital or abandonment of a subsidiary previously controlled by the Group, as the gain or loss relates

tomainly exchange movements in previous periods rather than the current period

– The reclassification of finance income/(expenses) on tax balances into income tax expense, to align

with the Group’s tax guidance. As a result, the income/(expenses) are presented as part of income tax

expense on an adjusted basis

– Other individually material items of expense or income. Some of these items are resolved over

aperiod of time such that the impact may affect more than one reporting period

Adjusted measures

– Adjusted Operating Profit and Adjusted Operating Profit margin: Adjusted operating profit reflects

the IFRS operating profit excluding items in line with the Group’s adjusted items policy. See page 226

for details on the adjusting items and a reconciliation between IFRS operating profit and adjusted

operating profit. The adjusted operating profit margin is the adjusted operating profit expressed

asapercentage of net revenue

– Adjusted tax rate: The adjusted tax rate is defined as the adjusted continuing income tax expense

asa percentage of adjusted profit before tax

– Adjusted diluted EPS: Adjusted diluted EPS is the IFRS diluted EPS excluding items in line with the

Group’s adjusted items policy. See page 226 for details on the adjusting items and a reconciliation

between IFRS net income and adjusted net income. The weighted average number of shares for

theperiod is the same for both IFRS diluted EPS and adjusted diluted EPS

– Adjusted EBITDA (earnings before interest, tax, depreciation and amortisation): Adjusted operating

profit less depreciation and amortisation (excluding adjusting items)

Other non-GAAP measures

– Like-for-like (LFL): Net revenue growth or decline at constant exchange rates (see below) excluding the

impact of acquisitions, disposals and discontinued operations. Completed disposals are excluded from

LFL revenue growth for the entirety of the current and prior years. Acquisitions as at the balance sheet

date are included in LFL revenue growth twelve months after the completion of the relevant acquisition.

LFL growth also excludes countries with annual inflation greater than 100% (Venezuela and Argentina).

LFL policy will be updated in 2024 to exclude low margin manufacturing revenues agreed at the time of

sale of a brand or business. In 2023, net revenue included £10 million of such low margin revenues

– Constant exchange rate (CER): Net revenue and profit growth or decline adjusting the actual consolidated

results such that the foreign currency conversion uses the same exchange rates as were applied in the

prior year, and excludes the effect of applying hyperinflation accounting in the relevant subsidiaries

– Brand Equity Investment (BEI): BEI is the marketing support designed to capture the voice, mind and

heart of our consumers

– Net working capital (NWC): NWC is the total of inventory, trade and other receivables and trade and

other payables less interest accrued on tax balances, indemnity provisions for disposed businesses

and forward purchase liabilities. NWC is calculated as a % of last twelve months net revenue to

compare changes in NWC to the growth of the business

– Net Debt: The Group’s principal measure of net borrowings being the total of cash and cash equivalents,

short-term and long-term borrowings, lease liabilities and derivative financial instruments on debt

– Free Cash Flow and Free Cash Flow Conversion: The Group’s principal measure of cash flow defined as

net cash generated from continuing operating activities less net capital expenditure. A reconciliation of

cash generated from operations to Free Cash Flow is shown on page 225. The Group tracks Free Cash

Flow as a % of adjusted net income to understand the conversion of adjusted profit into cash

224 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Alternative Performance Measures continued

Other definitions and terms

– Category Market Unit (CMU): Reckitt analyses its market share by CMUs, which represent country

andeither brand or category, e.g., US Lysol. This allows us to analyse the components of market share

growth taking into account both geography and brand/category. Management has identified those

Core CMUs that are the most strategically important. The list of Core CMUs is kept under continual

review and will change over time based on strategic decisions. Currently, Core CMUs cover c.65%

ofGroup net revenue and between c.55% to c.80% of each Global Business Unit’s (GBU) net revenue.

As a measure of competitiveness, management tracks the percentage of Core CMUs holding or

gaining market share, weighted by net revenue

– E-commerce: E-commerce channel net revenue is direct sales from Reckitt to online platforms or

directly to consumers. Estimates of total E-commerce sales as a percentage of Group net revenues are

calculated by adding E-commerce channel net revenue to an estimate of E-commerce sales achieved

by our brands through omnichannel distributors and retailer websites

– Discontinued operations: Includes credits or charges related to the previously demerged RB

Pharmaceuticals business that became Indivior plc. Net profit/(loss) from discontinued operations

ispresented as a single line item in the Group Income Statement

– Return on Capital Employed (ROCE): Defined as adjusted operating profit after tax divided by

monthly average capital employed. Capital employed comprises total assets less current liabilities

other than borrowings-related liabilities. Total assets exclude cash, retirement benefit surplus, current

tax and a technical gross-up to goodwill that arises because of deferred tax liabilities recorded against

identified assets acquired in business combinations. Total assets have been adjusted to add back

impairments of Goodwill except where the impaired asset has been disposed or partially disposed.

Current liabilities exclude the share repurchase liability, legal provisions recorded as a result of

adjusting items and current tax

– Net revenue attributable to ‘more sustainable’ products: A product is defined as ‘more sustainable’

when it scores a total of 10 or more points across five parameters (carbon, water, plastics, packaging

and ingredients) at time of launch using our Sustainable Innovation Calculator (a streamlined Lifecycle

Assessment tool that models the environmental impacts of products). The net revenue from ‘more

sustainable’ products is expressed as a percentage of total net revenue. The calculation is done on

thebasis of a 12 month period ending September (to allow for the assembling of the related data)

Reconciliation of IFRS to Like-for-Like Net Revenue (by GBU)

For the year ended 31 December

Net revenue

Hygiene

£m

Health

£m

Nutrition

£m

Group

£m

2022 IFRS 5,960 5,992 2,501 14,453

M&A – (40) (12) (52)

Exchange and hyperinflation (37) (7) 1 (43)

2022 Like-for-like 5,923 5,945 2,490 14,358

2023 IFRS 6,135 6,062 2,410 14,607

M&A – (8) (7) (15)

Exchange and hyperinflation 93 190 (13) 270

2023 Like-for-like 6,228 6,244 2,390 14,862

Like-for-like growth 5.1% 5.0% (4.0%) 3.5%

Like-for-Like Net Revenue Growth

% Hygiene Health Nutrition Group

2020 19.5% 13.9% 0.1% 13.9%

2021 7.5% (0.8%) 2.7% 3.5%

2022 (3.1%) 14.7% 22.9% 7.6%

2023 5.1% 5.0% (4.0%) 3.5%

4 year Compound Annual Growth Rate (CAGR) 6.9% 8.0% 4.9% 7.0%

This shows net revenue growth since Reckitt set out our strategy for rejuvenating sustainable growth

inFebruary 2020 to rebuild like for like revenue growth to the mid-single digit range.

225 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Alternative Performance Measures continued

Reconciliation of Operating Cash Flow to Free Cash Flow

31 Dec 2023

£m

31 Dec 2022

£m

Cash generated from continuing operations 3,829 3,430

Less: net interest paid (263) (209)

Less: tax paid (922) (831)

Less: purchase of property, plant & equipment (348) (362)

Less: purchase of intangible assets (101) (81)

Plus: proceeds from the sale of property, plant & equipment 63 84

Free cash flow 2,258 2,031

Free cash flow conversion 97% 83%

12 months Adjusted EBITDA to Net Debt

Adjusted EBITDA

31 Dec 2023

£m

31 Dec 2022

£m

Operating profit 2,531 3,249

Excluding: adjusting items 842 190

Adjusted operating profit 3,373 3,439

Excluding: adjusted depreciation and amortisation 444 402

Adjusted EBITDA 3,817 3,841

Net debt

31 Dec 2023

£m

31 Dec 2022

£m

Cash and cash equivalents (inc. overdrafts) 1,380 1,156

Financing liabilities (8,670) (9,140)

Net debt (7,290) (7,984)

Net debt/Adjusted EBITDA (times) 1.9 2.1

Dividend Cover

31 Dec 2023

£m

31 Dec 2022

£m

Interim dividend paid in year 549 523

Final dividend proposed 828 789

Total dividends 1,377 1,312

Adjusted net income 2,323 2,452

Dividend cover (times) 1.7 1.9

Net Working Capital

31 Dec 2023

£m

31 Dec 2022

£m

Inventories 1,637 1,825

Trade and other receivables 2,062 2,082

Trade and other payables (5,506) (5,547)

Less: Forward purchase liability 158 –

Less: Interest accrued on tax balances 122 105

Less: Indemnity provisions for disposed businesses 48 –

Net working capital (1,479) (1,535)

Net working capital as percentage of 12-month net revenue (10%) (11%)

ROCE Calculation

31 Dec 2023

£m

31 Dec 2022

£m

Adjusted operating profit 3,373 3,439

Less: taxation on adjusted operating profit (850) (753)

Adjusted net operating profit after tax 2,523 2,686

IFRS total assets 27,136 28,742

IFRS total current liabilities (8,338) (8,341)

IFRS total assets less current liabilities 18,798 20,401

Excluding IFRS items not included in capital employed:

Short-term borrowings 1,679 1,721

Current tax liabilities 620 791

Legal provisions 30 90

Interest accrued on tax balances 122 105

Share repurchase liability 296 –

Cash and cash equivalents (1,387) (1,157)

Current tax recoverable (80) (155)

Retirement benefit surplus (270) (294)

IFRS balances included in capital employed 19,808 21,502

Add back: impact of unrealised impairments 4,078 3,490

Less: goodwill due to deferred tax on intangibles (4,265) (4,385)

Impact of average in year vs closing balance 531 (289)

Average capital employed 20,152 20,318

Return on capital employed 12.5% 13.2%

226 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Alternative Performance Measures continued

1 EPS is calculated using 716.7 million shares (basic) and 718.3 million shares (diluted)

The table below reconciles the Group’s IFRS measures to its adjusted measures for the year ended 31 December 2023.

Adjusting items

IFRS

£m

Impact of

business

combinations

£m

Gain on

disposal of

brands

£m

Reclassified

foreign

exchange

translation on

liquidation of

subsidiaries

£m

Finance

income

reclass

£m

Other

individually

material items

of income and

expense

£m

Adjusted

£m

Net revenue 14,607 – – – – – 14,607

Cost of sales (5,847) – – – – – (5,847)

Gross profit 8,760 – – – – – 8,760

Net operating expenses (6,229) 28 1 – – 813 (5,387)

Operating profit 2,531 28 1 – – 813 3,373

Net finance expense (130) (9) – (130) 22 – (247)

Profit before income tax 2,401 19 1 (130) 22 813 3,126

Income tax charge (753) (4) (9) – (22) (1) (789)

Net income from continuing operations 1,648 15 (8) (130) – 812 2,337

Less: Attributable to non-controlling interests (14) – – – – – (14)

Net income from continuing operations

attributable to owners of the parent company 1,634 15 (8) (130) – 812 2,323

Net profit from discontinued operations 9 – – – – (9) –

Total net income attributable to owners of the

parent company 1,643 15 (8) (130) – 803 2,323

Earnings per share (EPS)

Continuing operations

Basic 227.9 2.1 (1.1) (18.1) – 113.3 324.1

Diluted 227.4 2.1 (1.1) (18.1) – 113.1 323.4

Discontinued operations

Basic 1.3 – – – – (1.3) –

Diluted 1.3 – – – – (1.3) –

Total operations

Basic 229.2 2.1 (1.1) (18.1) – 112.0 324.1

Diluted 228.7 2.1 (1.1) (18.1) – 111.8 323.4

Impact of business combinations comprises:

– £27 million relates principally to amortisation of certain

intangible assets recognised as a result of historical

business combinations and a related £4 million tax

credit;and

– £9 million finance credit relating to reduction in the liability

under the agreement to purchase the non-controlling

interest in RB Manon (note 30), and£1million of related

professional fees.

Net gain on disposal of brands includes charge of £2 million

relating to remeasurement on held for sale of certain small

developing market brands (note 31), a related £9 million tax

credit and £1 million of residual income relating to previous

brand sales.

Reclassified foreign exchange translation on liquidation

ofsubsidiaries of £130 million relates to a gain following

theliquidation of legal entities as part of simplification

oftheGroup’s legal entity structure.

Reclassification of finance income of £22 million relates

tothe reclassification of net interest expense on income

taxbalances from net finance expense to income tax.

Other individually material items of income and

expensecomprise:

– £810 million impairment of goodwill in IFCN (note 9);

– £3 million expense relating to costs incurred in relation

tothe Korean HS issue; and

– £9 million income from discontinued operations which

relates to the DoJ settlement in 2019.

227 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Alternative Performance Measures continued

The table below reconciles the Group’s IFRS measures to its adjusted measures for the year ended 31 December 2022.

Adjusting items

IFRS

£m

Impact of

business

combinations

£m

Gain on

disposal of

brands

£m

Reclassified

foreign

exchange

translation on

liquidation of

subsidiaries

£m

Finance

income

reclass

£m

Other

individually

material items

of income and

expense

£m

Adjusted

£m

Net revenue 14,453 – – – – – 14,453

Cost of sales (6,092) – – – – – (6,092)

Gross profit 8,361 – – – – – 8,361

Net operating expenses (5,112) 33 (14) – – 171 (4,922)

Operating profit 3,249 33 (14) – – 171 3,439

Net finance expense (161) – – (69) (26) – (256)

Share of loss and impairment of

equity-accounted investments (21) – – – – – (21)

Profit before income tax 3,067 33 (14) (69) (26) 171 3,162

Income tax charge (711) (11) (7) – 26 12 (691)

Net income from continuing operations 2,356 22 (21) (69) – 183 2,471

Less: Attributable to non-controlling interests (19) – – – – – (19)

Net income from continuing operations

attributable to owners of the parent company 2,337 22 (21) (69) – 183 2,452

Net loss from discontinued operations (7) – – – – 7 –

Total net income attributable to owners of the

parent company 2,330 22 (21) (69) – 190 2,452

Earnings per share (EPS)

Continuing operations

Basic 326.7 3.1 (2.9) (9.6) – 25.5 342.8

Diluted 325.7 3.1 (2.9) (9.6) – 25.4 341.7

Discontinued operations

Basic (1.0) – – – – 1.0 –

Diluted (1.0) – – – – 1.0 –

Total operations

Basic 325.7 3.1 (2.9) (9.6) – 26.5 342.8

Diluted 324.7 3.1 (2.9) (9.6) – 26.4 341.7

Impact of business combinations of £33 million relates

principally to amortisation of acquired intangible assets

recognised through historical business combinations.

Incometax relates to an £11 million tax credit in relation

tothis amortisation.

Gain on disposal of brands and related intangible assets

of£14 million relates to the disposal of Dermicool (£49 million

loss) and E45 and related brands (£63 million gain). Included

within income tax expense is a deferred tax credit of

£28million arising on the derecognition of deferred tax

liabilities, offset by a £21 million tax charge incurred in

relation to the disposals.

Reclassified foreign exchange translation on liquidation

ofsubsidiaries of £69 million is the gain following the

liquidation of legal entities as part of simplification of

theGroup’s legal entity structure.

Reclassification of finance income of £26 million relates

tothe reclassification of net interest income on income

taxbalances from net finance expense to income tax.

Other individually material items of income and expense

of £171 million is composed of:

– £152 million expense relating to the impairment

ofBiofreeze goodwill;

– £14 million expense relating to the reorganisation

oftheNutrition business subsequent to the disposal

ofIFCNChina in 2021; and

– £5 million expense relating to costs incurred in relation

tothe Korean HS issue.

Included within income tax expense is a £12 million net tax

charge in relation to the IFCN China strategic review.

1 EPS is calculated using 715.3 million shares (basic) and 717.5 million shares (diluted)

228 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Shareholder Information

Annual General Meeting

Our Annual General Meeting (AGM) will be held on Thursday 2 May 2024 at 14:00 at the London Heathrow

Marriott Hotel, Bath Road, Hayes, Middlesex UB3 5AN.

The Notice convening the AGM meeting, together with the business to be considered at the meeting,

iscontained in a separate document for shareholders and is available on our website at

www.reckitt.com/investors/annual-general-meetings.

2024 financial calendar and key dates

Announcement of Quarter 1 trading statement 24 April 2024

Annual General Meeting 2 May 2024

Record date for 2023 final dividend 12 April 2024

Payment of 2023 final ordinary dividend 24 May 2024

Announcement of 2024 interim results 24 July 2024

Record date for 2024 interim dividend 2 August 2024

Payment of 2024 interim ordinary dividend 13 September 2024

Announcement of Quarter 3 trading statement 23 October 2024

Dividend

The Directors recommend a final dividend of 115.9 pence per share for the year ended 31 December

2023. Subject to shareholder approval at the 2024 AGM, payment of the final dividend will be made on

24 May 2024 to all shareholders on the register as at 12 April 2024. The latest date for receipt of new

applications to participate in the Dividend Reinvestment Plan (DRIP) in respect of the 2023 final dividend

is 2 May 2024. Details on how to join the DRIP can be found below.

Dividend Reinvestment Plan (DRIP)

Shareholders participating in the DRIP receive additional shares purchased in the market instead of

receiving a cash dividend. You can elect to join the DRIP by registering on the Computershare Investor

Centre at www.investorcentre.co.uk. Alternatively, you can request a DRIP mandate form and terms and

conditions by contacting Computershare on +44 370 703 0118.

Mandatory direct credit

We no longer pay dividends by cheque. Instead, cash dividends are now paid directly to shareholders’

bank accounts. This is known as ‘mandatory direct credit’. Receiving dividends this way means that

shareholders receive dividend funds quicker. It also means the Company reduces its environmental

impact, incurs lower administration costs and reduces the risk of cheque fraud.

To have your dividends paid directly into your bank account, please provide your bank details to our Registrar,

Computershare, either by accessing Computershare’s Investor Centre at www.investorcentre.co.uk or by

telephone on +44 370 703 0118. We will hold your dividends for you until you provide valid bank details and

charges may be applied to reissue any outstanding dividend payments.

If you are based overseas, Computershare can offer an international payment option to have your

dividends paid into your local account in a preferred currency. Please register online by visiting

www.investorcentre.co.uk, where you can review the full details and associated fees.

Share dealing facility

The Company’s shares can be traded through most banks, building societies, stockbrokers or ‘share

shops’. In addition, UK-based shareholders can buy or sell the Company’s shares using a share dealing

facility made available by Computershare, which includes internet and postal share dealing.

Internet share dealing

Internet share dealing is available to shareholders residing in the UK. This service offers shareholders a

straightforward way to buy or sell the Company’s shares on the London Stock Exchange. The commission

is 1.4%, subject to a minimum charge of £40. In addition, stamp duty, currently 0.5%, is payable on

purchases. Real-time dealing is available during UK market hours (08:00 to 16:30). In addition, you can

place a sale instruction outside of market hours.

To access the service, log on to www.computershare.com/dealing/uk. Shareholders must have their

Shareholder Reference Number (SRN) available. The SRN appears on share certificates. Internet share

dealing is only available to residents in either the UK, Channel Islands or Isle of Man.

Postal share dealing service

The postal share dealing service offers a way to sell or purchase shares (subject to availability). To use

theservice you must be a resident of the UK or one of the permitted jurisdictions. A full list of permitted

jurisdictions can be found at www.computershare.com/dealing/uk. If you wish to use the service, you can

download a postal share dealing form and the terms and conditions at www.computershare.com/dealing/uk.

The fee for this service is 1.4% of the value of each sale or purchase and is subject to a minimum charge of

£40. Stamp duty of 0.5% may be payable on purchases.

Detailed terms and conditions for both internet and postal dealing are available upon request by calling

+44 370 702 0000.

229 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Shareholder Information continued

Electronic shareholder communications

We encourage all shareholders to receive an email notification when shareholder documents become

available online, to reduce our impact on the environment. An election to receive electronic shareholder

communications will:

– result in cost savings to the Company since less paper documentation will need to be produced

andposted;

– allow for quicker and more effective communications with shareholders; and

– support Reckitt’s corporate responsibility profile.

Shareholders can register for electronic communications by registering at www.investorcentre.co.uk.

Shareholders who have elected for electronic communications will receive an email whenever

shareholder documents are available on the Company’s website. Shareholders who have elected by

deemed consent, in accordance with the CA 2006, will receive a hard copy notice of availability of a

document on the Company’s website and are entitled to request a hard copy of any such document,

atany time, free of charge from Computershare. Shareholders can revoke their consent to receive

electronic communications at any time by contacting Computershare.

The Company’s 2023 Annual Report and Notice of the 2024 AGM are available to view at www.reckitt.com.

The Investor section of the website also contains up-to-date information for shareholders to view

throughout the year, including:

– detailed share price information;

– financial results;

– regulatory announcements;

– dividend history, payment dates and amounts;

– access to shareholder documents including the Annual Report and Notice of AGM; and

– share capital information.

Analysis of shareholders as at 31 December 2023

Distribution of shares by type of shareholder No. of holdings Shares

Nominees and institutional investors 2,948 728,445,231

Individuals 9,948 8,089,948

Total 12,896 736,535,179

Size of shareholding No. of holdings Shares

1–500 7,324 1,391,393

501–1,000 2,032 1,473,968

1,001–5,000 2,006 4,167,361

5,001–10,000 310 2,226,412

10,001–50,000 541 13,290,266

50,001–100,000 202 14,190,441

100,001–1,000,000 371 123,087,357

1,000,001 and above 108 576,707,981

Total 12,896 736,535,179

American Depositary Receipts (ADRs)

ADRs are dollar-denominated securities that represent the ownership of ordinary shares in a non-US

company, quoted and traded in US dollars in the US securities market. ADRs facilitate the purchase,

holding and sale of non-US shares by US investors. Dividends are paid to investors in US dollars.

Reckitt Benckiser Group plc ADRs are traded on the over-the-counter (OTC) market under the symbol

RBGLY. Five ADRs represent one ordinary Reckitt share. J.P. Morgan Chase Bank N.A. is the Depositary.

The table below provides details of the identification of Reckitt securities on the US market place and

the London Stock Exchange.

Symbol Security Listing/Trading CUSIP/ISIN

RBGLY US security (ADR) OTC Pink 756255204

RKT.L. Ordinary share London Stock Exchange GB00B24CGK77

230 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Shareholder Information continued

ADR Depositary Bank

J.P. Morgan Chase Bank N.A. sponsors and administers the Reckitt ADR facility.

J.P. Morgan ADR shareholder services can be contacted as follows:

J.P. Morgan Chase Bank N.A.

383 Madison Avenue, Floor 11, New York, NY 10179

Telephone number for general queries: +1 800 990 1135

Telephone number from outside the US: +1 651 453 2128

Website: www.shareowneronline.com

Company Secretary

Catheryn O’Rourke

Registered office

103-105 Bath Road, Slough, Berkshire SL1 3UH, United Kingdom

Telephone: +44 1753 217800

Registered in England and Wales, No. 6270876

Company status

Public Limited Company

Auditor

KPMG LLP

Solicitors

Slaughter and May

Registrar

The company’s Registrar, Computershare, is responsible for maintaining and updating the shareholder

shareholding, please contact Computershare.

Computershare Investor Services PLC

The Pavilions, Bridgwater Road, Bristol BS99 6ZZ

Shareholder helpline

Telephone: +44 370 703 0118

Website: www.computershare.com/uk

Charity donation

ShareGift is a UK registered charity (No.1052686) which specialises in realising the value locked up in

smallshareholdings for charitable purposes. The resulting proceeds are donated to a wide range of

charities, reflecting suggestions received from donors. If you have only a small number of Reckitt

shareswhich areuneconomic to continue holding, you may wish to consider donating them to ShareGift.

Please visit www.sharegift.org/donate-shares or telephone +44 207 930 3737 for more information.

Unsolicited mail

We are legally obliged to make our register of shareholders available to the public, subject to a proper

purpose test. As a result, some shareholders might receive unsolicited mail. Shareholders wishing to limit

the amount of such mail should write to the Mailing Preference Service, MPS FREEPOST 29 LON20771,

London W1E 0ZT or register online at www.mpsonline.org.uk.

Share fraud and ‘boiler room’ scams

Share fraud is a deceptive practice that induces investors to make sales and purchases based on

inaccurate information and in violation of security laws. In boiler room scams, fraudsters will entice

investors into scams through increased persuasion and high-pressure tactics through cold calling or

random contact.

Reckitt is aware of these deceptions and urges shareholders who are offered unsolicited investment

advice, discounted shares, a premium price for shares, or free company or research reports to investigate

thoroughly before making any decision.

If you receive any form of unsolicited investment advice, please take the following steps:

– Confirm the name of the person and/or organisation

– Check the Financial Conduct Authority’s (FCA) Financial Services Register at www.register.fca.org.uk/

toensure they are authorised

– Use the details on the Financial Services Register to contact the firm

– Call the FCA Consumer Helpline on +44 800 111 6768 (freephone) or 0300 500 8082 (from the UK),

ifthere are no contact details on the Register or if they are out of date

– Search the FCA’s list of unauthorised firms and individuals at

www.fca.org.uk/consumers/unauthorised-firms-individuals to avoid doing business with

reportedoffenders

– If you are approached by fraudsters please contact the FCA using its helpline, or share fraud

reportingform

– Consider getting independent financial advice

Using an unauthorised firm to buy or sell shares or other investments will prohibit access to the

FinancialOmbudsman Service or Financial Services Compensation Scheme (FSCS) should the

investmentbe unsuccessful. Remember: if it sounds too good to be true, it probably is. If you

thinkyouhave been a victim of these scams, the matter should be reported to the Police

andtoActionFraud. For more information, please visit the Serious Fraud Office website at

www.sfo.gov.uk/contact-us/reporting-serious-fraud-bribery-corruption.

231 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Shareholder Information continued

Cautionary note concerning forward-looking statements

This Annual Report and Financial Statements contains statements with respect to the financial condition,

results of operations and business of Reckitt Benckiser Group plc and the Reckitt group of companies

(the Group) and certain of the plans and objectives of the Group that are forward-looking statements.

Words such as ‘intends’, ‘targets’, or the negative of these terms and other similar expressions of future

performance or results, and their negatives, are intended to identify such forward-looking statements.

Inparticular, all statements that express forecasts, expectations and projections with respect to future

matters, including targets for net revenue, operating margin and cost efficiency, are forward-looking

statements. Such statements are not historical facts, nor are they guarantees of future performance.

By their nature, forward-looking statements involve risk and uncertainty because they relate to events

and depend on circumstances that will occur in the future. There are a number of factors that could

cause actual results and developments to differ materially from those expressed or implied by these

forward-looking statements, including many factors outside the Group’s control. Among other risks and

uncertainties, the material or principal factors which could cause actual results to differ materially are:

the general economic, business, political, geopolitical and social conditions in the key markets in which

the Group operates; the Group’s ability to innovate and remain competitive; the Group’s investment

choices in its portfolio management; the ability of the Group to address existing and emerging

environmental and social risks and opportunities; the ability of the Group to manage regulatory, tax and

legal matters, including changes thereto; the reliability of the Group’s technological infrastructure or that

of third parties on which the Group relies including the risk of cyber-attack; interruptions in the Group’s

supply chain and disruptions to its production facilities; economic volatility including increases in the

costof labour, raw materials and commodities; the execution of acquisitions, divestitures and business

transformation projects; product safety and quality, and the reputation of the Group’s global brands;

andthe recruitment and retention of key management.

These forward-looking statements speak only as of the date of this Annual Report and Financial

Statements. Except as required by any applicable law or regulation, Reckitt expressly disclaims any

obligation or undertaking to release publicly any updates or revisions to any forward-looking statements

contained herein to reflect any change in the Group’s expectations with regard thereto or any change

inevents, conditions or circumstances on which any such statement is based.

Any information contained in the 2023 Annual Report and Financial Statements on the price at which

shares or other securities in Reckitt Benckiser Group plc have been bought or sold in the past, or on the

yield on such shares or other securities, should not be relied upon as a guide to future performance.

232 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Notes

233 Reckitt Annual Report and Accounts 2023 FINANCIAL STATEMENTS OTHER INFORMATIONSTRATEGIC REPORT GOVERNANCE

Notes

reckitt.com

Reckitt Benckiser Group

Registered office

103-105 Bath Road

Slough, Berkshire

SL1 3UH, UK

Registered in England and Wales

No 6270876

Reckitt Annual Report and Accounts 2023