Diversity and Inclusion 2018 · 6 2018 Diversity and Inclusion Report The D&I Principles I. Banco...

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Diversity and Inclusion Report 2018

2 2018 Diversity and Inclusion Report

By being responsible, we build loyalty

I´m loyal to Santander because...

... Santander treats me responsibly

... Santander acts responsibly in society

In our day-to-day businesses, we ensure that we do not simply meet our legal and regulatory requirements, but we exceed people s expectations by being Simple, Personal and Fair in all we do.

We focus on areas where, as a Group, our activity can have a major impact on helping people and businesses prosper.

People

Shareholders Communities

Customers

“ By delivering on our purpose, and helping people and businesses prosper, we grow as a business and we can help society address its challenges too. Economic progress and social progress go together. The value created by our business is shared – to the benefit of all.

Communities are best served by corporations that have aligned their goals to serve the long term goals of society. ”Ana Botín

Our approach

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We have obtained the highest score out of the

230 companies, from different sectors, that form part of the Bloomberg Gender Equality Index (which covers employees and customers) for 2018 and 2019.

85% of employees believe Santander treats them fairly regardless of their age, family, marital status, gender identity, expression, disability, race, colour, religion or sexual orientation.(Global Engagement Survey +4 vs 2017).

603 scholarships for university students with disabilities.

1. What is Diversity and Inclusion and why is it important? ........................................04

2. D&I is a priority for Santander ............06

Our purpose .........................................................06

Our D&I Principles ...............................................07

Our Governance ...................................................08

Our Commitments on D&I .................................09

3. How Santander supports D&I through our key stakeholderst ..............................10

People ...................................................................10

Gender ..............................................................11

Disability ...........................................................14

Cultural diversity .............................................16

LGBTI .................................................................17

Employee networks ........................................18

Customers .....................................................................19

Consumer Protection Policy Principles ........ 19

Vulnerable customers ....................................20

Gender: providing solutions for women ........20

Disability: making our branches more accessible .........................................................21

Shareholders ...............................................................22

A Diverse Board ...............................................22

Transparency and Communication .............. 23

Communities ...............................................................24

Suppliers ...........................................................24

Fundación Universia .......................................25

4. Santander contributes to the United Nations Sustainable Development Goals ......................................................................27

Managing diversity in an inclusive way that reflects our values, will enable us to understand modern society and foster the best relationships with our stakeholders

Diversity and Inclusion ReportIndex

2018 highlights

Overview


1. What is Diversity and Inclusion and why is it important?Diversity is about empowering people by respecting and appreciating what makes them different, in terms of age, gender, ethnicity, religion, disability, sexual orientation and national origin. Inclusion is a sense of belonging. Inclusive cultures make people feel respected and valued as who they are as an individual or group. In simple terms, Diversity is the mix, and Inclusion is getting the mix to work well together. (Source: Global Diversity Practice)

There are many circumstances that make the human kind diverse. Some of them are visible, such as gender or race, and others might be invisible, such as values, religion or education.

Successful businesses incorporate diversity and inclusion in their entire value chain. Having a diverse workforce enables companies to understand and reflect modern society, which is critical to business success.

Promoting diversity and inclusion at all levels attracts, develops and retains the best talent, is a strong contributor to innovation, organisational performance, trust in companies and meeting all of the stakeholders’ expectations.

“Companies in the top quartile for gender diversity outperform their competitors by 15% and those in the top quartile for ethnic diversity outperform their competitors by 35%.” Embracing Diversity And Fostering Inclusion Is Good For Your Business. Forbes 2018.

“Deloitte’s research reveals that high-performing teams are both cognitively and demographically diverse”. The diversity and inclusion revolution: Eight powerful truths. Deloitte. 2018.

“When employees “think their organisation is committed to and supportive of diversity, and they feel included,’ their ability to innovate increases by 83%.” Embracing Diversity And Fostering Inclusion Is Good For Your Business. Forbes. 2018.

Organizations with inclusive cultures are:

2xas likely to meet or

exceed financial targets

3xas likely to be

high-performing

6xmore likelyt to be

innovative and agile

8xmore likelyt to achieve

better business outcomes

Source: Juliet Bourke, Wich Two Heads Are Better Than One? How Diverse Teams Create Breakthrough Ideas and Make Smarter Decicions (Australian Institute of Company Directors, 2016).Deloitte Insights / deloitte.com/insights

17 sustainable development goals

NO POVERTY

ZERO HUNGER

GOOD HEALTH AND WELL-BEING

QUALITY EDUCATION

GENDER EQUALITY

CLEAN WATER AND SANITATION

AFFORDABLE AND CLEAN ENERGY

DECENT WORK AND ECONOMIC GROWTH

INDUSTRY, INNOVATION AND INFRASTRUCTURE

REDUCED INEQUALITIES

SUSTAINABLE CITIES AND COMMUNITIES

RESPONSIBLE CONSUMPTION AND PRODUCTION

Climate ACTION

LIFE BELOW WATER

LIFE ON LAND

PEACE, JUSTICE AND STRONG INSTITUTIONS

PARTNERSHIPS FOR THE GOALS

Santander’s focus on Diversity and Inclusion is aligned with the UN Sustainable Development Goals...

Promotes university education to help the communities in which it is present to prosper.

QUALITY EDUCATION

Promotes equal opportunities between men and women.

Educate various groups so they can obtain a decent job.

GENDER EQUALITY

Collaborates with many social institutions to improve the quality of life of people and meet their needs.

Helps people and businesses prosper to support the sustainable growth of communities.

REDUCED INEQUALITIES

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2. Diversity and Inclusion is a priority for Santander

Santander’s purpose is to help people and businesses prosper and our values are to be Simple, Personal and Fair in everything we do. These values and purpose are reflected at every level of the organization, which is why Diversity and Inclusion are such an important part of the Santander culture. We believe that by upholding our values, we are appealing to our stakeholders at a personal level and earn their trust.

“ Diversity is not just good for women. It is good for men, it is good for society, and it is good for Santander and for the world. And so, achieving that diversity in gender, and in many other areas also like race, background, age, disability, is key to succeeding in today’s world. ”Ana Botín, Group executive chairman.

Our purpose

A strong sense of purpose helps us to create a loyal workface...

...which helps us build customer loyalty

...while helping us build community loyalty...

...which enables us to build shareholder loyalty...

• Millenials are 5 times likely to stay with employers when they feel a strong connection with their employer´s purpose

• 70% of global workforce want to work for an organisation with a powerfull social conscience

• 33% of consumers would now choose to buy from brands based on their social and environment impact

• 67% of people would be willing to try a brand for the first time because its position on social issues

• 80% would tell friends and family about a company´s CSR efforts

• 72% would volunteer for a cause supported by a company they trust

• The market size of sustainable responsible and impact investing in the United States alone in 2016 was $8.72 trillion

1 2

4 3


The importance of our purpose

Helping people andbusinesses

prosper

“Without a sense of purpose, no company, either public or private, can achieve its full potential.”Larry Fink, Blackrock


The D&I Principles

I. Banco Santander is committed to offering Equal Opportunities to all our employees. Our leaders and our employees (shared responsibility) follow this as a key leadership principle. Employees are selected, remunerated and promoted based on meritocracy without any type of discrimination. Our leaders promote inclusive working environments in which individual differences are valued and respected. This equality of opportunities is part of our Group’s Employee Value Proposition as part of the strategy for attracting and retaining talent.

II. Ensuring that the Group’s people management policies, processes, systems and tools do not entail any bias that may lead to discrimination of any kind.

III. Diverse talent management with inclusive leadership is an element that adds value and enriches our employees, our customers, our shareholders and communities, constituting a competitive advantage that helps us to attain our business objectives.

IV. Our customers are diverse (in terms of gender, race, age, beliefs….) and our employees must reflect this. The new kind of digital customer we are targeting will also require us to have diverse profiles.

V. Compliance with the prevailing international and local diversity, inclusion and equal opportunities legislation in each country will be ensured.

VI. Recognition of the contribution each person can make based on difference.

VII. The support of the leaders and managers of the Group, who will play an active role in diversity management.

VIII. Pay equality is ensured in total workforce, consistently with the positions, responsibilities and functions. The process is properly monitored to correct any detected pay inequality, based on the Equal Opportunities principle.

Our Diversity and Inclusion PrinciplesWe have defined our Diversity and Inclusion Principles, aimed to serve as an ‘umbrella’ for all local initiatives and to set minimum standards for countries in their action plans, which will further improve diversity and inclusion in Santander. These general principles have been incorporated into our Board-approved Corporate Culture Policy as an enabler of cultural transformation and can serve as a guide for the Group.

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Our GovernanceWe have created a Responsible Banking, Sustainability and Culture Committee (RBSCC) to help the Group progress towards its goal of being a more responsible bank. The RBSCC is the highest governance body for Corporate Culture, which is supported by the Culture Steering Group and the Inclusive & Sustainable Banking Steering Group.

The Culture Steering Group, which meets monthly, provides direction, approval and oversight to help embed a consistent culture throughout Santander. To ensure appropriate management and promote diversity and inclusion at Group level we have created two specific working groups that support the Culture Steering Group:

A Global D&I Executive Working Group

Main function: develop and give direction to Group Diversity and Inclusion Strategy for successfully tackling the challenges faced by the Group. Specific functions:•Act as ambassadors of D&I principles inside the Group. •Identify challenges – review and decide on proposals regarding global D&I and initiatives.•Engage and follow up regularly on decisions taken, KPIs and metrics.•Drive and support D&I initiatives internally and externally Members: Business influencers and decision makers from different geographies and functions.

A Global Network of D&I experts

Main function: implement the actions identified as priority areas in local units, share best internal and external practices and act as focal contact point for reportingI.

Specific functions:

• Share best internal and external practices.

• Identify and propose priority areas for action at a global level.

• Transmission of the D&I Principles at local level.

• Focal contact point for reporting results and KPIs to relevant entities.

Members: Local experts on D&I, representatives from the countries of 12 different geographies, global CSR (Corporate Social Responsibility) and Fundación Universia.

Training on Diversity and Inclusion

In order to foster an inclusive leadership and to help to raise awareness, the Bank has launched a global D&I online training based on learning experiences where participants will develop new skills.

This training is essentially given through eWorkouts, following a learning method in which employees get to explore topics independently. We are currently focusing on 4 programmes:

Diversity and Inclusion

Knowing me

knowing you

Breaking bias

The In-crowd

Micro- messages

How are others different like

me?

Are you controlling your mind or is your mind

controlling you?

Are the people you like, like you?

It is not enough to think big. Do

you know how to think small?



Our commitments on Diversity and Inclusion

2018

2018

2018

2018

2021

2025

2025

2025

Women in the BoardWe aim for more female representation at the Board level, well above the average for large listed companies in Europe.

Women in senior management positionsBeing open and inclusive is one of our four Leadership Commitments, therefore, embracing differences and promoting diversity is fundamental to achieving our cultural transformation.

Equal pay gap in all subsidiaries1

We are committed to identifying unjustified gender imbalances.

Cultural diversity2

A group that is culturally diverse, with different educational background, experience, race and age reflects the different needs of our customers and our other stakeholders.

DisabilityWe are constantly searching opportunities to leverage talent without any discrimination.

Meet or exceed the local legal requirement and contribution to people with disabilities access to labour market

33%

20,5%

3%

50%

40-60%

30%

0%

70%

1. Compares employees of the same job, level and function.2. Includes different educational background, experience in different sectors, international experience, country of origin, race and age

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Promoting Diversity and Inclusion across the Group is a key way to transform our culture.Therefore, we foster diverse teams (in terms of profiles, origins, gender, age, beliefs) and inclusive leadership ensuring that all employees enjoy genuine equal opportunities. We recognize and support all existing sources of diversity, both visible and invisible.

People

3. How Santander supports Diversity and InclusionSantander strongly believes that D&I is fundamental to our cultural transformation, and delivering our strategy.

Empl

oyee

s who

ar

e more motivated

and c

ommitte

d...

People

• Gender• Disability• Cultural diversity• LGBTI • Employee networks

1

Communities

Simple Personal Fair

People

• Gender• Disability• Cultural diversity• LGBTI • Employee networks

1

• Suppliers• Fundación Universia

4

...which results in more

Empl

oyee

s who

ar

e more motivated

and c

ommitte

d...

investment in communities....which driv

es pr

of ta

bilit

y

and sustainab

le gr

owth

...

...make our customers

more satisf ed and loyal...

Customers

• Consumer Protection Policy Principles

• Vulnerable customers• Gender: providing solutions for

women• Disability: making our branches

more accessible

2

Shareholders

• A Diverse Board• Transparency and

Communication

3

Diversity and Inclusion touches on many topics and drives loyalty as shown below:

We have defned 3 main areas in relation to the Santander´s employees diversity:

1. Gender

2. Disability

3. Cultural **Includes different educational background,

experience in different sectors, international experience, country of origin, race and age.

3. How Santander supports Diversity and Inclusion


GenderEqual opportunities between men and women is a priority throughout the Group. We are promoting multiple initiatives in order to achieve effective equality between men and women at all levels.

Progress on gender balance• In 2008, 51% of employees were women. In

2018, 54.5% of our workforce were women.

• At the Board level, 11% of members were women in 2008. In 2018, 33% were women.

• In 20131, 16,7% senior managers were women. In 2018, women represented 20,5% in senior management positions.

• There was a 3% equal pay gap and 31% gender pay gap in 2018. Ver video

“ Although Banco Santander leads the Bloomberg Gender-Equality Index, last year we issued guidelines to ensure that building a diversified workforce is a priority across the Group. Our aim is to have women in 30% of leadership positions by 2025. In addition, the Board recognises the important benefits of having an appropriately balanced board composition. It has therefore adopted the aim of achieving an increased female representation on the Board between the range of 40% to 60% ” Ana Botín, Group executive chairman.

1. 2008 data not available

For the second consecutive year Santander has obtained the highest score out of the 230 companies that form part of the Bloomberg Gender-Equality Index, which evaluates the performance of companies in gender equality.

Banco Santander leads the Bloomberg Gender-Equality Index made up of 230 companies from different sectors

95.32points out to 100

https://www.youtube.com/watch?v=N77e9NaTd4A&feature=youtu.be

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In order to achieve a more diverse workforce, we have included measures to facilitate a better work-life balance for both men and women. Our Global Engagement survey shows that 82% of employees indicate that their direct manager helps them reach a reasonable balance between personal and professional life.

Flexible working

We believe that flexible working helps find the right balance between personal and professional life. That is why our corporate Flexiworking policy, applicable to the entire Group, includes a set of measures such as flexible schedules or the possibility to work remotely. Also, every country has initiatives related to flexible working especially for childcare reasons. For example:

Mexico offers flexible work hours for nursing mothers & the afternoon off on a child´s first birthday.

In Spain, pregnant women can request to change their workplace after their sixth month of pregnancy in order to reduce commuting.

Maternity and paternity leave

The different policies regarding maternity / paternity paid leave are adapted to local legislation. In all the geographies where the Bank operates there is minimum fully paid maternity leave available for the employees. The global minimum leave offered by the Bank in all countries is 6 weeks for maternity leave (as US & Portugal) and 1 week for paternity leave (as Chile & Brazil).

Notwithstanding the legal requirements, there are good practices that exceed the legal requirement across the Group:

In Mexico, the maternity leave period consists of 12 weeks for biological mothers and 6 weeks for adoption. The Bank also provides biological mothers up to 8 weeks in the event that the baby has a disability or requires hospitalization, so that maternity leave may be extended after childbirth. Biological or adoptive fathers receive 2 weeks paternity leave.

In Germany, employed women are exempt from work for six weeks before the date of delivery, and eight weeks after birth. In the case of twins, the employee will have 12 weeks instead of 8. Male employees can also request a leave of absence of 8 weeks after the birth.

Further measures have been developed in order to facilitate maternity returners:

In Spain, the Bank offers the “progressive reincorporation after maternity”, after maternity and lactation. Employees can return to work for 50% of the day during the first month and 75% of the day during the second month, without any reduction in their salary.

In Santander Brazil, “PAPE”, Personal Support Specialist Program, supports women to return to work after maternity leave.

Care subsidy:

In the UK Childcare vouchers are part of employee benefits. In addition, the Bank offers financial support for childcare (day care aid or baby-sitter): until the child reaches 5 years and 11 months.

In Brazil, employees who have a child or legal guardianship or custody of a child up to 6 years old, are eligible to receive a refund for babysitting, daycare or private school. Also, employees may request a scholarship for children intellectual disabilities.

On-site care (child care):

•The Corporate Headquarters, as other corporate facilities, are equipped with an infant education centre for up to 500 children, designed to help bridge the gap between family and working life.

•Also, there is a medical centre, which offers pediatric, dentistry & ophthalmologist to employee´s children.

•There are breastfeeding rooms available in Argentina, Mexico, Uruguay, Brazil and Corporate Headquarters to promote the wellbeing of women in this stage of motherhood. The Reception Centre and the Nursing team supports mothers.

Our InitiativesWork-life balance



Gender Pay Equality

We have established a methodology based on best practices, setting common guidelines for both the Group and local units. We aim to achieve Gender Pay Equality and eliminate biased paid practices. Likewise, local action plans are being promoted with periodic monitoring and control plans.

Communication and awareness

Santander Women’s Week: In the Corporate Center we celebrated International Women’s Day with different activities that lasted throughout the week:

•Talent by Santander: dedicated to enhancing and promoting female talent.

•”speed-dating” and learning: using the informal learning method “speed-dating”, 4 thematic corners were formed, promoting reflection and debate on relevant content: blockchain, gender inclusion, leadership and machine learning.

•Inspira futuro: activity to promote the debate on how women see Santander’s future.

Talent selection and identifcation

Banco Santander’s recruitment strategy consists of having gender balanced shortlists to guarantee women are equally represented at all organization levels. To do so, female interviewers are included for senior roles to provide a balanced view of potential candidates and avoid any bias.

For all selections for leadership positions, we replicate male/female representation in divisions.

Additionally, there is 28% women representation in the pipeline for top senior management.

Gender pay gap measures the difference in pay, regardless of the work´s nature, in an organisation, a business, an entire industry or the economy in general.

GPG is calculated as the difference of the median of the compensation paid to male and female employees expressed as a percentage of the median of the male compensation. For this calculation, compensation includes base salary and variable remuneration, excluding benefits/in kind remuneration or local allowances.

Reported figures are from a study conducted in 2018 (on the basis of 90% of the workforce), based on full-year 2017 compensation data updated to include 2018 compensation projections.

Gender pay gap

31% Calculation of equal pay gap compares employees of the same job, level and function. This allows to compare like for like jobs.

Factors included in the Group’s local policies which may impact compensation gap between male and female such as tenure in position, years of service, previous experience or background have not been considered to mitigate the reported figures.

Equal pay gap

3%

Poland: Female Side Of Business

In Poland, we have defined a 2019 action plan in cooperation with the biggest external female leadership communities, which include projects like:• “Women in Tech” with women from on top positions sharing their leadership experience in the Bank and externally.• “Mentoring programme for female successors” to boost women’s chance for taking specific positions in the future.-“Successful Women Week” where we show our top female leaders and educate young female students on potential career paths in the Bank and also in stereotypical male roles.• “My mummy works in a bank” with our women’s testimonials on how it feels to be a working mum, what benefits they appreciate and how they manage work-life balance.

•Additionally, Ana Botín, met with Corporate Centre and Openbank employees on International Women’s Day to discuss the main challenges women face at Santander Group in their daily work.

Santander Women Network: a network of professional women from different areas across the Santander Group. In Spain, there already 350 members. The objective is to share knowledge and experiences, and strengthen leadership and empowerment in order to promote gender diversity in the financial world.

Mexico “Equally Different”: this Diversity and Inclusion Campaign aims to acknowledge the value of diversity among professionals and creating a culture of inclusion. It focuses on four main pillars: female talent, Young talent, work-life balance and inclusive leadership.

Also, we have mentoring and development programmes to support women and help broaden the pipeline of female talent.

‘Accelerating You’: A nine-month leadership-development programme for talented women focused on networking and personal brand-development. With 289 participants, the programme has already proved successful: 9% of last year’s attendees have been promoted and 7% are above the organisational promotion baseline.

Argentina Programa Inspira: Inspira is the first programme in Santander Río related to leadership for women of high potential, with the diversity as a central axis. It is intended for passionate women with growth potential, who are encouraged to rethink aspects related to their professional development.

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Santander Group believes that the inclusion of people with disabilities is a question of talent, ethics and responsibility. Employing people with disabilities defends and promotes their independence, freedom and dignity. It also gives an opportunity to improve productivity, innovation, connection with society and employee engagement.

In 2018, 1.7% of our total workforce were people with a disability.

Disability

Our Initiatives

Continental Europe

1.24United Kingdom Group totalLatin America and other regions

Employees with a disability* ratio by region1 %

1.61 1.612.09

Senior management

6Other management Other staff

Average number of employees with a disability* 2018

64 3,4363,366

1. United States and Mexico data not included.

*An employee with disabilities is considered to be a person who is recognised by the State or the company in each jurisdiction where the Group operates and that entitles them to receive direct monetary assistance, or other types of aid such as, for example, reduction of their taxes. In the case of Spain, employees with disabilities have been considered to be those with a degree of disabilities greater than or equal to 33%. The amount does not include enployees in the United States.

Poland “Differently Abled”: this project is focused on creating a diverse and inclusive work environment

by preparing the organization to hire people with different disabilities. It is aligned with the Diversity Charter and Group Diversity Policy. Since 2018 actions have been undertaken to raise of the needs of people with disabilities, to overcome their employment barriers and create favourable conditions. For example, we have developed different educational campaigns directed at managers and employees and Human Resources staff has been trained on the process as recruitment and employment of people with disabilities.

Portugal: “Integraçao Laboral de Pessoas com Síndrome de Asperger”: Banco Santander supports the Associação Portuguesa de Asperger’s Syndrome (APSA), recognized by this Association as “Receivable Company” because of its promotion of social integration of people with Asperger´s Syndrome contributing to its integration on society.

Chile. Hiring people with disabilities through our partnerships with Fundación Tacal and Fundación Luz.

Talent selection and identifcation

Fundación Universia is a private non-profit organisation that promotes research, higher education and quality employment for people with disabilities. It is a key institution for helping Banco Santander on the aim of being a more inclusive bank.

The Foundation carries out initiatives that facilitate the progress and autonomy of people with disabilities, such as scholarships, internships and employment programmes.

To know more about the activities of Fundación Universia, see our section “Support to the community on disability with Fundación Universia” on page 25



Awareness

• Corporate Centre: “Abre tus sentidos” is an initiative in cooperation with Fundación Universia to promote a meeting space for awareness on disability. It consists in an awareness gymkhana with different games and activities that encompass all kinds of disability.

Argentina #ponteenmilugar, created by Baccigalupo Foundation, promotes integration in companies and raises diversity awareness. It consists of a day of sports games and reflection about the values of teamwork, and on how to empathize with the problems of co-workers. The event is conducted by students with disabilities of the Foundation who are graduates of the sports course.

Accessibility at the workplace

• Corporate centre’s Accessibility project: We aim to guarantee accessibility so any person can move with the greatest autonomy, eliminating the possible barriers in the buildings and in the transport of the Corporate Centre, which has obtained the Solidun seal (Universal Design Innovation Solution).

Chile. Sign language course:it is available for Bank employees who wish to learn Chilean Sign Language.

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Globalisation has led to a great cultural diversity in companies’ workforces..

Santander has defined cultural diversity as different educational background, experience in different sectors, international experience, country of origin, race and age.

Cultural diversity

Our Initiatives

Uruguay: Tu hijo es un crack

An internship program for the children of employees who are between 15 and 20 years old. Through this initiative, young people can work between one and two months in the summer period and have their first work experience. It is also an opportunity for parents to share their work experiences with their children.

Global: Young leaders

Launched in 2018, this professional global development programme has involved 280 young employees from 22 countries. Participants were chosen by their peers. They engage directly with our top executives, giving them the chance to share new ideas and perspective and contribute to the Group strategy. The programme actively promotes geographical, gender and professional diversity.

47% 53%

Brazil: Promoting racial diversity

In 2017, we launched our four Diversity priorities which included (1) gender, 2) race, 3) people with disabilities and diversity of training , 4) experiences and generation.

In 2018 in order to further promote racial diversity, we successfully increased our total black ethnia employees to 23% of our total workforce. By 2019, our goal is to reach 24%.

25%

17%

8%6%6%

5%

5%

4%

4%

4%

4%

11%

Commercial /Retail Banking

Corporate and Investment Banking

Techonology & Operations Santander Digital Risk Strategy Human Resources Accounting & Control

Young leaders

22Countries



Mexico:

Linkers is a 9 month programme that attracts young talent, and provides valuable learning experiences to high potential individuals.

Talento Joven is one of Mexico’s obkectives regarding diversity. It implies the development of possible collaborators, as well as the expansion of diversity in the Bank. We have four strategies to encourage the retention and development of young talent:

1. Awareness of generational diversity.2. A Social Responsibility Programme to engage

with the community.3. Bidirectional mentoring and strengthening

“Role Models”.4. Supporting development of career plans.

International Mobility As a global business, we need to develop future leaders who have a global perspective; attract and retain talent by offering people the chance to work abroad; develop a global mind-set.

We have defined four categories of mobility with different conditions and benefits:

Global Job PostingThis corporate platform offers all employees the chance to apply for global vacancies in other countries, companies or divisions. The aim is to

encourage employee mobility, development and transparent internal selection processes.

Since its launch in 2014, over 4,000 positions have been published globally.

Santander WorldOur people can work for several months on a project in another country, promoting the exchange of best practices and broadening their global vision. Since its launch to 2019 February, 1,912 people in 28 different countries have taken part.

Volunteer

Permanent transfer available for all employees

Expatriation

Long-term assignment to develop special tasks or at special destinations

Global Development

Long-term transfer for demonstrated high- talented employees

Agile Project based Assignment *

Short term deployment of specialized talent to

participate in international projects

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UK: supporting LGBT+ community

Embrace Network: Embrace is Santander UK’s LGBT+ Network. The network provides leadership, support and insight on LGBT+ related matters and aims to reflect and celebrate diversity in the workplace in order to create a supportive and inclusive culture. Currently in the UK, the network has over 3,000 staff members.

The Gender Identity and Expression Policy supports those employees going through transgender and gender dysphoria. A male to female employee was been featured on the cover of our quarterly health & wellbeing magazine to raise awareness on transgender issues and has become a transgender role model for the organization.

Our ExCo sponsor for LGBT+ was ranked as a top LGBT+ female ally in the Financial Times (FT) in 2017 and 2018; and our female co-chair of the LGBT+ network was recognised as a future LGBT+ leader in the FT.

Among other initiatives, we sponsor Diversity Role Models, which is a charity that tackles homophobia and bullying in schools. A number of female colleagues have volunteered to run diversity role model workshops in schools to raise awareness of these issues among young people.

Santander supports the UN- created standard of global conduct for the protection of LGBTI people in companies created by the United Nations Organization in order to support companies promote the equality of lesbian, gay, transgender, bisexual and intersex people beyond their jobs.

Lesbian, gay, bisexual, transgender and intersexual (LGBTI)*

We support LGBTI in all the countries where we are present. For example, Santander USA sponsored marches for the Pride in Boston and New York. Openbank Spain, launched its Open & Out employee network and used its Instagram account to show its support.

“ Santander, with more than 200,000 employees and 133 million customers worldwide, welcomes diversity in all its forms, and we are proud to support the UN’s LGBTI standards for companies ”Ana Botín, Group executive chairman.



For more information on our UK networks

1. Lesbian, gay, bisexual, transgender and queer.

Employee networksIn UK, a core initiative to embed diversity

and inclusion across our business has been the creation of the employee-led diversity networks focused on women, LGBT+ (Lesbian, Gay, Bisexual, Transgender +), BAME (Black, Asian and

We want to encourage a more balanced representation of women at Santander and enable female colleagues feel more empoewre to fulfil their true potential.

Embrace provides a community for lesbian, gay, bisexual and transgender employees to come together to share information, personal experience, hold discussions and support one another.

Ethnicity@Work aims to celebrate and embrace different cultures, raising awareness about race diversity and different culture, providing a place to share information and experiencies based on traditions, ethnicity, heritage and customs.

Millions of people in the UK have a disability, and many of our colleagues are either or indirectly affected by disability. Our Enable! Network provides employees with a platform to share, learn, discuss and support.

The aim of this network is build a community for employees who are parents and/or carrers, providing a platform to engage on a number of topics with a vision for everyone to maintain a healthy work-life balance and reach their full potential regardless of personal circumstances.

The Network encourages positive mental wellbeing and supports this by promoting awareness, openness and understanding at all levels of the Bank.

In the USA our employee networks are helping people feel valued and connected since 2018:

Women’s Employee Network: Longest standing network with regional leads and appointed committees in eight US regions.

Embrace Network: Providing a supportive community for Santander’s LGBTQ1 employees and their allies with a range of events and communications keying on June’s Pride month designation.

Black Employee Network: Its members and committee are present across eight US regions overseeing the design and execution of the celebrations during Black History month (February) and organizing mentoring initiatives.

Conexion: Newest Employee Network, unites the Hispanic and Latina population held its kickoff leadership meeting in Dallas in April.

In 2019 we are launching a Veterans Group, a Group for Caregivers (families) and Abilities (for people with disabilities). Of the four initiatives already in place, we have enlisted more than 20% of our employee population.

Minority Ethnic), Disability, Parents and Carers and Mental Wellbeing. Each network is actively sponsored by an Executive Committee member.

www.santanderjobs.co.uk/diversity

19

Customers

...make our customers

more satisf ed and loyal...

• Consumer Protection Policy Principles

• Vulnerable customers• Gender: providing solutions for

women• Disability: making our branches

more accessible

2

CustomersTo achieve our aim of earning customers’ lasting loyalty, we must develop products and services that meet the demands of a diverse society.

We are proactive in adapting our services to reflect the diversity of our customers. We have developed our Consumer protection Principles within our Consumer Protection Policy.

Consumer Protection Policy Principles

Treat Customer fairly

Safeguarding of assets

Transparent communication

Customer-centric design of products and services

Responsible pricing

Data protection

Consideration of special customers’ circumstances

and prevention of over-indebtedness

Complaints handling

Responsible innovation

Financial education

Treat customers fairly: Customers have a right to be treated respectfully, honestly, and fairly. They are entitled to high ethical standards, clear, and non-discriminatory language, and the assurance that any requests, dissatisfactions, incidents or complaints they make will be dealt with rapidly, diligently, and effectively.

Consideration of special customer´s circumstances and prevention of over-indebtedness: The Group must act considering special circumstances and/or financial difficulties of customers, in order to proceed in their best interest and offer viable solutions whenever possible.

Customer-centric design of products and services: we offer products and services to customers based upon the strict assessment of their needs and characteristics; consideration of special circumstances and the customer’s capacity of over-indebtness; a reasonable balance between risks, costs, and expected profits and competitive positioning; availability of the minimum information customers need for a clear, appropriate, and unequivocal understanding of the terms and conditions, potential risks and benefits of the product or service.

Responsible innovation Customers must be considered in the process of developing new products, services, channels, business and organisational models.

There are 4 principles particularly related to the D&I matter...



Spain:

Argentina: Banca Women

In 2018 we launched the Generation 81, a programme committed to helping accelerate the progress of women. Its products and services are focused on three lines:

Financial autonomy: specialized financial products such as an exclusive life insurance for women to protect them in the event of gynecological cancer.

In Santander Rio, Argentina, the Banca Women programme consists of different initiatives to support women around 3 axes:

Community: promoting financial inclusion of women through special facilities such as the financing for women entrepreneurs through with advantageous conditions.

Social commitment: Santander makes alliances with consolidated entities such as Vogue or Disney in order to raise awareness about unconscious bias and break stereotypes.

Employment and education: scholarships, academic counselling and financial education.

Internal measures: flexible working and longer paternity permits than any other bank in the country in order to facilitate the balance between professional and personal life for women.

Clients: we offer products such as credit cards with specific benefits for women or a special insurance in the event of gynecological cancer.

For more information about Generación 81, visit their website

For more information about Banca Women, visit their website

A vulnerable customer is someone who, due to their personal circumstances, is especially susceptible to suffer a financial and / or personal damage or loss. Customers can be considered vulnerable for a large array of reasons like gender, age, incapacities, disabilities or impairments, limited access to education and illiteracy.

Vulnerable customers

Gender: providing solutions for women

We aim to create a consistent approach to the identification and treatment of vulnerable customers; to preventing over-indebtedness; and ensure that they are treated fairly according to their particular circumstances.

For this reason, we have created guidelines for the entire Group, which define who is a vulnerable customer, facilitate the consideration of their circumstances and help ensuring their protection.

https://www.bancosantander.es/es/particulares/generacion-81

https://www.santander.com.ar/banco/online/banca-women#beneficios

21

Poland: Barrier-Free Service Programme

Brasil and México Microfnance initiatives

For more than 9 years, Santander Bank Polska has been implementing and developing the Barrier-free Service programme to ensure convenient access to our products and services to customers with special needs (people with disabilities, elderly people and pregnant women. Santander Bank Polska offers its customers:

A network of certified branches without architectural barriers. Video service in the Polish Sign Language provided by advisors from the Contact Centre. Biometric solutions facilitating customer identification. ‘Talking’ ATMs which can be used by people with visual impairments.

Prospera, in Brazil, promotes the growth of small businesses, helping the most disadvantaged people and those with a lower standard of living to escape poverty.

Online and mobile banking services certified for accessibility by customers with disabilities. Advertising communication adapted to the needs of persons with visual impairments (audio description) and hearing impairments (subtitles and a sign language translator). The videos are available on the website of the Barrier-Free Service program (www.santander.pl/obb) and on the Bank’s YouTube channel.

In 2018 the Bank received an honorary mention in the competition ”Wielkopolska Open to Persons With Disabilities” for its activities counteracting social exclusion of people with disabilities and ensuring equal access to banking services.

Tuiio is a financial inclusion programme developed in Mexico for people with low incomes which aims to have a measurable social impact through a broad and expanding range of interconnected products.

Total 260.743

benefciaries

Total 22.318

benefciaries

2018 Prospera 2018 Tuiio

Through our microfinance programmes, we help people who are on low incomes, or are “underbanked”, to set up small businesses. As most of these entrepreneurs are woman, this is a way to contribute to their financial empowerment.

Improving accessibility to the products and services offered by the Bank is an important element of Santander’s commitment to being Simple, Personal and Fair.

We are renovating our branches so they are accessible to all, removing architectural barriers and increasing investment in technology to provide a more agile and personalised service.

*A core way to build a more inclusive society is to ensure every citizen has access to, and can use financial services. See our Financial Empowerment 2018 Report for details on how we are financially empowering citizens in all our markets

Disability: making our branches more accessible

67%women174.698

91%women20.309

33%men86.045

9%men2.008


https://www.santander.com/csgs/Satellite/CFWCSancomQP01/en_GB/pdf/Financial_Empowerment_2018.pdf

https://www.santander.com/csgs/Satellite/CFWCSancomQP01/en_GB/pdf/Financial_Empowerment_2018.pdf


Shareholders

2. On the disclosure of non-financial and diversity information and with EBA and ESMA guidelines on suitability assessment of board members and key functions holders.

Shareholders

...which driv

es pr

of ta

bilit

y

and sustainab

le gr

owth

...

• Diverse Board• Transparency and

Communication

3

If we are to meet the needs of the societies in which we operate, our Board must be diverse and reflect those societies. We seek a balance of technical skills, experiences and perspectives.

Our Policy governing the selection, suitability assessment and succession of directors promotes diversity on the Board, and non-discrimination on grounds of gender, sexual orientation, race, religion, origin, marital status, age or social condition.

This Policy was amended in July 2018 in line with the European legislation . The Bank applies this Policy when selecting or replacing Board members.

The Selection Policy promotes diversity in the board of directors from different standpoints:

• Geographical provenance or background diversity.

• Gender diversity.

• Education and professional background.

• The Policy has no implicit bias that could lead to discrimination by age, race, disability and/or ethnic origin.

The functioning, effectiveness and results of the execution of our Diversity Policy can be evidenced by the breadth of skills, experience and diversity on the Board and its committees.

A Diverse Board

Geographical provenance / international education

Europe73.3%

Latam20%

Others6.7%

US/UK46.7%

Board composition

Independent non-executive directors60%

Executive directors20%

Other external directors (non-

proprietary and non-independent)

20%

Diversity

Male66,7%

Female33,3%

23

In February 2019, the Board agreed to increase our current objective of women representation of 30% (which we have had since 2015) to equal presence (between 40% and 60%) in 2021.

We seek the lasting trust and loyalty of our more than 4,1 million shareholders in 170 countries. As a responsible bank, transparency and engagement with investors and shareholders is our key priority.

Transparency is vital to earn the trust of our shareholders and other stakeholders; we are proactive in aligning our reporting and disclosure with their expectations.

The Bank is at the forefront of the best practices in engagement with shareholders and institutional investors, focusing in earning their lasting loyalty and driving profitability and sustainable growth to their investments, in a Simple, Personal and Fair way and according to our

We strive to encourage our shareholders engagement wherever they are based. To acheive that, we have adopted measures to facilitate the participation of shareholders at the Annual General Meeting (AGM); relevant information is made available to them as required by law. We answer all questions that shareholders send before the AGM , related to the agenda.

Santander aims to provide the maximum level of accessibility to all users of www.santander.com. Santander is working on the development and maintenance of the webpage in accordance with international accessibility directives1. We have adopted some measures like adapting the text size, using the same structural layouts or the interpretation of graphic resources.

Transparency and communication

Banco Santander has obtained the AENOR certificate on Sustainable Events management system, which proves the sustainability of its General Shareholders’ Meeting. Santander is the first financial organization to receive this recognition from AENOR, based on the UNE-ISO 20121 Standard. This certifies that all the processes of the General Shareholders’ Meeting, from its planning until the end, follow sustainable criteria; supports the hiring of local suppliers and personnel at risk of exclusion; as well as the use of collective transport.

1. We follow the Accessibility directives defined by the working group Web Accessibility Initiative (WAI), of the Consortium for the World Wide Web (W3C), at level AA. We also take in account WCAG rules (Web Content Accessibility Guidelines) of the W3C (World Wide Web Consortium), at intermediate level (AA), Web Content Accessibility Guidelines 2.0, a recommendation by the W3C on the Cascading Style Sheets, Level 2 (CSS 2.1) and the recommended standard in using the HTMLcode, verifying the XHTML 1.0 Transitional recommendations.

Skills and experience Board Tenure

0 to 3 years20%

4 to 11 years53,3%

12 years or more

26,7%

Thematic skill Horizontal skillsBanking 93.3%

Other fnancial services 73.3%

Accounting, auditing & fnancial literacy 93.3%

Retail 93.3%

Digital & information technology 33.3%

Risk management 86.7%

Business strategy 86.7%

Responsible business & sustainability 86.7%

Human resources, culture, talent & remuneration 93.3%

Legal 26.7%

Governance & control 93.3%

International experience: Europe 93.3%

US/UK 80%

Latam 66.7%

Others 33.3%

Top management 93.3%

Government, regulatory & Public policy 40.0%

Academia & education 60%

Signifcant directorship tenure 100%



* Global Compact: voluntary initiative based on CEO commitments to implement universal sustainability principles and to take steps to support UN goals.

Communities

Our suppliers throughout the world also have an impact on communities and the environment. We expect our suppliers to operate in a responsible way, upholding certain ethical, social and sustainable standards, as we do.

In 2018, we strengthened the principles of responsible behaviour for suppliers, which have been included in our Supplier Certification Policy. These principles, aligned with the ten principles of Global Compact* , establish the minimum standards that we expect from our suppliers on social matters, including diversity and inclusion. Our suppliers must therefore treat all their employees fairly and equally and not to discriminate on the basis of birth, race, sex, religion, opinion or any other personal or social condition or circumstances.

Fundación Universia and the Global Vendors Team have sent out a Diversity and Inclusion questionnaire to vendors in an attempt to:

1- Understand the situation of our vendor base regarding Diversity and Inclusion.

2- Extend our corporate values beyond the Bank´s boundaries.

We ask suppliers the questions regarding D&I, sometimes amended to reflect local circumstances, insome of our biggest markets: Brazil, Spain, Germany and Uruguay.

This questionnaire will help us clarify whether a company meets our Corporate Social Responsibility Standards, thereby encouraging suppliers to become more diverse and inclusive.

Suppliers

Communities

...which results in more

investment in communities.

• Suppliers• Fundación Universia

4

25

To know more about Universia’s activities

Fundación Universia is the world’s largest university cooperation network, with the sponsorship of Banco Santander. It is driven by the desire to promote inclusion and professional development of people with disabilities.

The Foundation endorses the inclusion of people with disabilities through initiatives

like scholarships, internships, and special employment programmes. It also raises awareness through cultural and sports initiatives.Fundación Universia supports Banco Santander in the real and qualified inclusion of people with disabilities.

Fundación Universia

2018 highlights

19.475 people reached through different programmes

4.224 new university students with disabilities registered

153 people with disabilities hired in companies

78 free of charge tech-assistance products for university students with disabilities

603 scholarships for university students with disabilities

26 entrepreneurs with disabilities supported in starting their businesses

1.152 associations and foundations connected in order to improve inclusive projects

12.872 people attended inclusive Arts and Culture activities

151 Santander HQ’s interns played wheelchair basketball lead by the sub22 European MVP

14.779 followers on social media


https://www.youtube.com/user/FundacionUniversia/videos


Santander IncluyeAt its corporate headquarters and with the support of Fundación Universia, Banco Santander launched a new edition of “Santander Includes”, an internship programme for university students with disabilities. This initiative promotes inclusive education and employment opportunities through the development of their talent.

Since 2017 “Santander Includes” has helped 30 university students with disabilities to carry out their internships in various business areas.This offers a very valuable work experience to complement their training and the support from a professional that helps them on the development of skills and abilities for their future.

Sumando TalentoIn our “Adding Talent” initiative, female leaders and young university students with disabilities join forces in a job training meeting in our Corporate Centre.

The aim is for the new generation of women to know first-hand the reality of disability, overcoming any bias and discovering talent.

For young the young students, it is an opportunity to create contacts within the group and to receive job training advice, which can help them achieve their professional goals.

STEM Talento MujerIn 2018 we launched the second call for the STEM Woman Talent Scholarships for STEM profiles.Through this programme, we have granted 30 financial grants of up to 5,000 euros to women who study a postgraduate or master’s degree in STEM subjects - science, technology, engineering and mathematics -. In addition, this initiative includes conducting training practices in different areas of the Bank.

Our D&I initiatives which help communities

Santander W50Banco Santander, via Santander Universities, runs the Santander W50 programme, on international training for female management personnel with leadership potential.

With the support of the Anderson School of Management at the University of California (UCLA), it offers 45 scholarships for women managers with 15 to 25 years of professional experience. Since 2011, when the programme was first launched, more than 680 professionals from 33 countries on 4 continents have participated.

De mujer a mujerIn 2018 we have also launched the third edition of the program “From women to women”, to support women victims of gender violence, helping to improve their employability and increasing their chances of getting out of their vulnerable situation. The participants are women with a qualified profile who seek to return to the labor market and have the opportunity to start a new life.

27

We invest more in education than any other private company in the world through our scholarship programmes. We believe education is key to an open and inclusive society.

• We maintain agreements with more than 1,200 universities.

• We have awarded more than 70000 scholarships and grants to students in 2018.

Santander X, our international university entrepreneurship project, chosen as good practice by the Spanish Network of the Global Compact to achieve the SDGs in 2030.

We promote a diverse and inclusive workforce that reflects society and allows us to face future challenges.

• New general principles on diversity and inclusion that provide global guidelines and minimum standards.

• 54.5% of women in the workforce, 20.5% of women in management positions.

For the second consecutive year, Santander has obtained the highest score among the 230 companies that are part of the Bloomberg Gender-Equality Index.

We have a prepared and committed team that allows us to respond and meet the needs of customers, help entrepreneurs to create businesses and employment, and strengthen local economies.

• We encourage flexible working to facilitate the balance of personal and professional life.

• In 2018 we received the Top Employers Europe 2018 certification and occupied one of the first three positions in the ranking of the best financial institutions to work for in Latin America in 2018, according to Great Place to Work.

We protect the most vulnerable in society by developing products that give them access to fnancial services.

• We have developed our Corporate Guidelines for the protection of vulnerable Customers, which take into account diversity criteria.

• Our microfinance initiatives Prospera and Tuiio have helped over 195.000 women in 2018.

We believe that innovation and the good use of new technologies are enablers of a more inclusive society.

• Our Corporate Centre has obtained the Solidun seal (Universal Design Innovation Solution), which certifies that our premises are barrier free.

• We are renovating our branches so they are accessible to all, removing architectural barriers and increasing investment in technology to provide a more agile and personalized service.

4. Santander contributes to the United Nations Sustainable Development GoalsWhilst we acknowledge the progress made to date, we know that there is more to do.Our commitments reflect the importance we give to Diversity and Inclusion and our initiatives are aligned to the achievement of the SDG’s.

4. Santander contributes to the United Nations Sustainable Development Goals

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