Virgin Money Modern Slavery Statement

What do we mean by Modern Slavery?

Modern slavery is a very real and present threat to society, harming some of the most vulnerable people in society.

The term covers all forms of slavery, servitude, forced labour, human trafficking, and exploitation for personal or commercial gain. That includes appalling, unacceptable practices like child labour, forced marriage and sex trafficking.

Sadly, it’s all around us but often hidden from sight, as it can be difficult to spot, and many victims don’t identify that way.

This makes it hard to measure the true impact, which is likely much larger than we’re aware of.

This statement shares the actions we’ve taken so far to tackle modern slavery, and our commitments on how we intend to help combat this offence.

Fast Facts

• In 2021, an estimated globally 49.6 million people lived in modern slavery, with 27.6 million in forced labour, although measuring impact is difficult so numbers could be higher. ^[1]
• There were 12,727 potential victims of modern slavery referred to the UK home office in 2021. ^[2]
• 2021 saw the highest number of referrals in the UK since records began, with trends showing 23% tend to be female and 43% affecting children. ^[2]

Who is Virgin Money?

We are the UK’s 6th largest bank, offering an innovative digital platform, with products and services to meet the full range of around 6.6 million customers’ retail and business banking needs. Our online and mobile services for customers are supported by an innovative digital platform and a national network of stores, contact centres and relationship managers. We have hubs in Glasgow and Newcastle Upon Tyne and satellite locations in Leeds and London.

You can find more information on who we are and what we do on our website.

Being a Force for Good

Our ambition at Virgin Money is to drive positive social and environmental impact through everything we do.

As a purpose-led business dedicated to Making you happier about money, we’re focused on where we can make the biggest difference to the environment and society.

We are committed to the delivery of Sustainable Development Goals (SDGs), including the eradication of forced labour, modern slavery and human trafficking and the protection of labour rights, as described in SDG Goal 8.7. Signing up to the United Nations’ Principles for Responsible Banking guides our strategy by providing a framework to enable us to continually improve our impact and contribution to society. Our latest Annual Report and Accounts provides more information on our progress so far.

Human rights, fair treatment, and a world free from slavery, persecution and exploitation should be a given. But they’re not, so we all need to step up and drive the change we want to see.

At Virgin Money we take this responsibility seriously. We’ve set ourselves goals and bold aspirations as part of our ESG strategy, and we’re embedding these in all areas of our business with robust targets, tracking and disclosures. An important aspect of this is managing social and environmental challenges, such as modern slavery.

Virgin Money has a zero-tolerance approach to modern slavery, and we are committed to doing business with honesty and integrity. We believe in treating everyone with dignity and respect and are committed to raising awareness and understanding of these offences to eliminate the practice from our supply chain, customer base and other stakeholder relationships.

This statement is made pursuant to the UK’s Modern Slavery Act 2015 and applies to all of our group companies (Virgin Money UK PLC and its subsidiaries) and all employees and officers of our group companies. It was approved by the Board of Directors of Virgin Money UK PLC and its principle operating subsidiary Clydesdale Bank PLC on 29th March 2023.

Copies of previous statements, including those predating the combination of Virgin Money and Clydesdale Bank are available here.

What are we doing about Modern Slavery?

Culture and Strategy

Modern slavery is firmly on our Board and Senior Management agenda, driving our zero-tolerance approach to modern slavery from the top down through all of Virgin Money.

Our goal is to consider modern slavery at every significant decision point or gateway, ensuring every colleague is empowered and committed to acting on any concerns they identify. This means building the risks of modern slavery into how we assess, manage, and protect customers, stakeholder relationships and suppliers.

Detect and Disrupt

We comply with the relevant laws and practices on how we should treat colleagues, customers, and stakeholders. However, our role extends beyond that, to the business practices and behaviours of everyone in our entire business ecosystem.

Modern slavery could appear in our suppliers’ businesses, or further down the supply chain through the suppliers of our suppliers.

Our products and services could be used by modern slavery offenders, like slavery gangs and people traffickers.

Criminals may try to exploit our colleagues or customers in their efforts to launder their money and engage in financial crime.

It’s vital that everyone in our business knows when, where and how to look for signs of modern slavery, supported with the right processes, systems, and controls to make sure we do everything possible to stamp it out for good, wherever it exists.

Policies, Process and Risk

We give our people a framework of policies, processes, and technical standards to run Virgin Money safely and effectively.

There are measures and guidance designed to help us identify, assess, and combat all aspects of financial crime, including money laundering, which is sometimes linked to modern slavery.

We reviewed our Group Anti-Money Laundering & Counter Terrorist Financing Policy Standard this year to ensure we have the right controls in place for mitigating Financial Crime Risks. These controls support the mitigation of modern slavery-related offences in our operations.

We manage modern slavery risks in our customer relationships by doing our due diligence while onboarding and then refreshing the customer data we hold periodically throughout the customer lifecycle.

We monitor customer account activity to identify suspicious activity which might indicate modern slavery. Where there’s cause for concern, we make extra checks and follow the necessary reporting. This might be escalating to the National Crime Agency or the Banking Protocol – an initiative between banks, the police and trading standards which aims to identify vulnerable victims or suspicious activity, helping prevent crimes such as modern slavery. It could even be both, depending on the situation.

We work closely with external agencies and law enforcement, as well as attending industry meetings to stay on top of emerging modern slavery trends. The intelligence we get from this helps us strengthen our capabilities to recognise red flags in customers’ transactional behaviours.

We continue to monitor existing, and emerging modern slavery risks in our business, updating and establishing new processes and policies, such as developing our credit policy this year to include reference to modern slavery - all which help us to conduct business ethically and react appropriately. Building on the work done in previous years, we will undertake a risk assessment this year of our key functions to ensure the controls we have in place continue to be robust. This will inform future direction and enable us to help further eradicate modern slavery-related crimes.

Training and Awareness

We committed last year to focus on educating our people, and we’ve been engaging them throughout the year to raise awareness of the crime and the role we play, celebrating events such as Anti-Slavery day. We also provide a suite of learning tools to educate colleagues on the knowledge, approaches, and best practices to dealing with modern slavery that are important to a purpose-led business like ours.

Our mandatory ‘Risks in Banking’ training represents an all-encompassing online risk course educating our people on financial crime, fraud awareness, market abuse and whistleblowing. It includes a financial crime training module, raising awareness of all financial crime risks, where guidance on spotting red flags in relation to modern slavery is covered.

We have also created a stand-alone modern slavery training module this year that educates our people on what we mean by modern slavery, drawing on real examples. It covered how to spot signs of the offence with case studies, the role we play in mitigating these crimes, and how we build a safe space for our customers, including our escalation process. This was delivered in July 2021 and completed by over 90% of our colleagues.

We review the modules annually to ensure they remain aligned with legislative requirements and market practices, along with internal policy and process changes.

Everyone should have knowledge and awareness of these offences, as covered in the mandatory training, but our front-line operations and risk functions play a vital role in the identification and escalation of modern slavery. To build on the training delivered this year, we will be working with those business units to provide additional bespoke training on modern slavery. This ensures our colleagues have the right tools and are best equipped to spotting any potential signs of modern slavery-related activity as they support our customers.

Suppliers

We function in a responsible, ethical, open, and transparent way, so it’s no surprise that we expect the same from the suppliers and stakeholders we work with. We want to ensure they uphold the same standards as we do, encouraging greater transparency within company supply chains to stamp out modern slavery-related offences.

Virgin Money has an extensive supplier base. We operate a risk-based approach to initial and ongoing due diligence which includes a review of suppliers’ ethical and social responsibility credentials. Our sourcing and due diligence processes are continually reviewed to ensure they are fit for purpose and reflective of current risks.

Our Supplier Code of Conduct sets out the standards, principles and behaviours we expect from our suppliers. Above all, we want to do right by our people. We protect and respect human rights and essential labour standards, including the International Labour Organisation Core Conventions. We expect our suppliers to be as committed as we are in embracing vital regulation such as the Modern Slavery Act 2015. Our top tier suppliers must positively affirm they’ve read and will comply with our code. We’re ready and waiting to work through any challenges our suppliers are facing.

Compliance relies on teamwork and, as a member of the ‘Financial Services Qualification System’ community, we’ve agreed with other banks a standardised approach to information-gathering to ensure policy compliance. We invite all our key suppliers to join this service. Currently, over 180 of our suppliers share information with us as part of the system, and the level of information requested and shared by each supplier varies based on the risk classification of the products and services they provide. We use this as part of our Supplier Relationship Management process, providing oversight of each supplier’s compliance with our internal policies and governance controls.

When we work with recruitment services, we make sure our suppliers apply the same high standards that Virgin Money does. Verifying ID, the right to work in the UK, and running criminal background and credit checks helps us learn who we’re employing to identify whether someone is connected to modern slavery-related activities, as perpetrator or victim.

We want everyone to feel happier about money, but we rely on the people we work with (like our suppliers) to make it happen. We know that by working closely together with a shared purpose and values, better things are bound to follow.

Our Commitments

We want to take the same approach to combating modern slavery as we do for delivering exceptional customer experiences that go beyond banking. That means being straight up, offering heartfelt service and staying red hot relevant.

We are always searching for new ways to tackle modern slavery, challenging everyone we interact with to take action, and use all opportunities to achieve best practice. Transparency is key to eradicating modern slavery and we welcomed the launch of the Government’s Modern Slavery Statement Registry – a central source to enhance accessibility and clarify company action. Our 2023 statement application details the positive steps we’re taking for this cause.

We’ve previously engaged with the Independent Anti-Slavery Commissioner, who published her findings on ‘The role of the financial sector in eradicating modern slavery: CEOs respond to the Independent Anti-Slavery Commissioner.’We continue to develop our approach, aligned to evolving recommendations and guidance.

Modern slavery is a distressing reality. We believe it’s everyone’s responsibility to change that, and we know that Virgin Money and its people can be a positive force in that cause.

Looking forward

Our focus is on actions that move towards best practice following our recent risk assessment, and to continue educating the people we identified as playing a vital role in the identification and mitigation of modern slavery-related crimes. This will give them the tools to best support our customers, businesses, and suppliers. Our re-launched modern slavery working group will continue to drive action throughout the organisation to maintain the positive progress we’re making.

It’s vital that Virgin Money responds to modern slavery in a way that reflects our Purpose of ‘Making you happier about money’ and our values. That means being honest about the prevalence of modern slavery in our ecosystem, taking responsibility for doing something about it, and following through on those commitments.

We’re proud to report we’re continuing to make good progress with initiatives such as our aspiration to ensure that by 2030 none of our customers will be paying the poverty premium. This is the extra cost that low-income households pay to access basic services. We know how important it is to support and protect those that have been exploited and we must do away with the premium to remove additional burdens forced upon victims on their road to recovery. However, we know there’s still much more to do.

On behalf of the Virgin Money Board, we confirm our commitment to working with not just colleagues but also our suppliers, customers, and many other stakeholders to continue to drive change and help make modern slavery a thing of the past.

David Duffy, Group Chief Executive Officer

For and on behalf of the boards of Virgin Money UK PLC and Clydesdale Bank PLC

29 March 2023

What do we mean by Modern Slavery?

Modern slavery is a very real and present issue right now, harming some of the most vulnerable people in society.

The term covers all forms of slavery, servitude, forced labour, human trafficking, and exploitation for personal or commercial gain. That includes appalling, unacceptable practices like child labour, forced marriage and sex trafficking.

Sadly, it’s all around us but often hidden from sight, as it can be difficult to spot, and many victims don’t identify that way. This makes it hard to measure the true impact, which is likely much larger than we’re aware of.

This statement shares the actions we’ve taken so far to tackle modern slavery, and our commitments on what we intend to do to help combat this offence.

Fast Facts

• 2018’s Global Slavery Index estimated that 40.3 million people lived in modern slavery, with 24.9 million in forced labour^[1]. Measuring the impact is hard, so this number could be much higher.
• There were 8,730 modern slavery crimes recorded by UK police in the year to March 2021. That’s 5% up on cases recorded a year earlier.^[2] The Covid-19 pandemic is believed to have negatively impacted referral numbers as a result of the restrictions.^[2]
• Since the Modern Slavery Act became law, the number of live police operations has increased from 188 in December 2016 to 3,335 in August 2021.^[2]

Who is Virgin Money?

We are the UK’s 6th largest bank, offering an innovative digital platform, with products and services to meet the full range of nearly 6.5 million customers’ retail and business banking needs. Our leading online and mobile services are supported by telephone and store banking, with a national network of stores and business banking centres. We have hubs in Glasgow and Newcastle Upon Tyne and satellite locations in Leeds, and London.

You can find more information on who we are and what we do on our website.

Being a Force for Good

Our ambition at Virgin Money is to drive positive social and environmental impact through everything we do.

We’re focused on where we can make the biggest difference to the environment and society, as a purpose-led business dedicated to Making you happier about money.

We are committed towards the delivery of Sustainable Development Goal 8.7, which calls for the eradication of forced labour, modern slavery, and human trafficking because we believe in stamping out this crime. Signing up to the United Nations’ Principles for Responsible Banking guides our strategy by providing a framework to enable us to continually improve our impact and contribution to society. Our latest Annual Report and Accounts provides more information on our progress so far.

Human rights, fair treatment, and a world free from slavery, persecution and exploitation should be a given. But they’re not, so we all need to step up and drive the change we want to see.

At Virgin Money we take this responsibility seriously. We’ve set ourselves goals and bold aspirations as part of our ESG strategy, and we’re embedding these in all areas of our business with robust targets, tracking and disclosures. An important aspect of this is managing social and environmental challenges, such as modern slavery.

Virgin Money has a zero-tolerance approach to modern slavery, and we are committed to doing business with honesty and integrity. We believe in treating everyone with dignity and respect and are committed to raising awareness and understanding of these offences to eliminate the practice from our supply chain, customer base and other stakeholder relationships.

This statement is made pursuant to the UK’s Modern Slavery Act 2015 and applies to all of our group companies (Virgin Money UK PLC and its subsidiaries) and all employees and officers of our group companies. It was approved by the boards of directors of Virgin Money UK PLC and its principle operating subsidiary Clydesdale Bank PLC on 23rd March 2022.

Copies of previous statements, including those predating the combination of Virgin Money and Clydesdale Bank are available here.

What are we doing about Modern Slavery?

Culture and Strategy

Modern slavery is firmly on our Board and Senior Management agenda, driving our zero-tolerance approach to modern slavery from the top down through all of Virgin Money.

Our goal is to consider modern slavery at every significant decision point or gateway, ensuring every colleague is empowered and committed to acting on any concerns they identify. This means building the risks of modern slavery into how we assess, manage, and protect customers, stakeholder relationships and suppliers.

Detect and Disrupt

We comply with the relevant laws and practices on how we should treat colleagues, customers, and stakeholders. However, our role extends beyond that, to the business practices and behaviours of everyone in our entire business ecosystem.

Modern slavery could appear in our suppliers’ businesses, or further down the supply chain through the suppliers of our suppliers.

Our products and services could be used by modern slavery offenders, like slavery gangs and people traffickers.

Criminals may try to exploit our colleagues or customers in their efforts to launder their money and engage in financial crime.

It’s vital that everyone in our business knows when, where and how to look for signs of modern slavery, supported with the right processes, systems, and controls to make sure we do everything possible to stamp it out for good, wherever it exists.

Policies, Process and Risk

We give our people a framework of policies, processes, and technical standards to run Virgin Money safely and effectively.

There are measures and guidance designed to help us identify, assess, and combat all aspects of financial crime, including money laundering, which is sometimes linked to modern slavery.

We reviewed our Group Anti-Money Laundering & Counter Terrorist Financing Policy Standard this year to ensure we have the right controls in place for mitigating Financial Crime Risks. These controls support the mitigation of modern slavery-related offences in our operations.

We manage modern slavery risks in our customer relationships by doing our due diligence while onboarding and then refreshing the customer data we hold periodically throughout the customer lifecycle.

We monitor customer account activity to identify suspicious activity which might indicate modern slavery. Where there’s cause for concern, we make extra checks and follow the necessary reporting. This might be escalating to the National Crime Agency or the Banking Protocol – an initiative between banks, the police and trading standards which aims to identify vulnerable victims or suspicious activity, helping prevent crimes such as modern slavery. It could even be both, depending on the situation.

We work closely with external agencies and law enforcement, as well as attending industry meetings to stay on top of emerging modern slavery trends. The intelligence we get from this helps us strengthen our capabilities to recognise red flags in customers’ transactional behaviours.

We continue to monitor existing, and emerging modern slavery risks in our business, updating and establishing new processes and policies, such as developing our credit policy this year to include reference to modern slavery - all which help us to conduct business ethically and react appropriately. Building on the work done in previous years, we will undertake a risk assessment this year of our key functions to ensure the controls we have in place continue to be robust. This will inform future direction and enable us to help further eradicate modern slavery-related crimes.

Training and Awareness

We committed last year to focus on educating our people, and we’ve been engaging them throughout the year to raise awareness of the crime and the role we play, celebrating events such as Anti-Slavery day. We also provide a suite of learning tools to educate colleagues on the knowledge, approaches, and best practices to dealing with modern slavery that are important to a purpose-led business like ours.

Our mandatory ‘Risks in Banking’ training represents an all-encompassing online risk course educating our people on financial crime, fraud awareness, market abuse and whistleblowing. It includes a financial crime training module, raising awareness of all financial crime risks, where guidance on spotting red flags in relation to modern slavery is covered.

We have also created a stand-alone modern slavery training module this year that educates our people on what we mean by modern slavery, drawing on real examples. It covered how to spot signs of the offence with case studies, the role we play in mitigating these crimes, and how we build a safe space for our customers, including our escalation process. This was delivered in July 2021 and completed by over 90% of our colleagues.

We review the modules annually to ensure they remain aligned with legislative requirements and market practices, along with internal policy and process changes.

Everyone should have knowledge and awareness of these offences, as covered in the mandatory training, but our front-line operations and risk functions play a vital role in the identification and escalation of modern slavery. To build on the training delivered this year, we will be working with those business units to provide additional bespoke training on modern slavery. This ensures our colleagues have the right tools and are best equipped to spotting any potential signs of modern slavery-related activity as they support our customers.

Suppliers

We function in a responsible, ethical, open, and transparent way, so it’s no surprise that we expect the same from the suppliers and stakeholders we work with. We want to ensure they uphold the same standards as we do, encouraging greater transparency within company supply chains to stamp out modern slavery-related offences.

Virgin Money has an extensive supplier base. We operate a risk-based approach to initial and ongoing due diligence which includes a review of suppliers’ ethical and social responsibility credentials. Our sourcing and due diligence processes are continually reviewed to ensure they are fit for purpose and reflective of current risks.

Our Supplier Code of Conduct sets out the standards, principles and behaviours we expect from our suppliers. Above all, we want to do right by our people. We protect and respect human rights and essential labour standards, including the International Labour Organisation Core Conventions. We expect our suppliers to be as committed as we are in embracing vital regulation such as the Modern Slavery Act 2015. Our top tier suppliers must positively affirm they’ve read and will comply with our code. We’re ready and waiting to work through any challenges our suppliers are facing.

Compliance relies on teamwork and, as a member of the ‘Financial Services Qualification System’ community, we’ve agreed with other banks a standardised approach to information-gathering to ensure policy compliance. We invite all our key suppliers to join this service. Currently, over 180 of our suppliers share information with us as part of the system, and the level of information requested and shared by each supplier varies based on the risk classification of the products and services they provide. We use this as part of our Supplier Relationship Management process, providing oversight of each supplier’s compliance with our internal policies and governance controls.

When we work with recruitment services, we make sure our suppliers apply the same high standards that Virgin Money does. Verifying ID, the right to work in the UK, and running criminal background and credit checks helps us learn who we’re employing to identify whether someone is connected to modern slavery-related activities, as perpetrator or victim.

We want everyone to feel happier about money, but we rely on the people we work with (like our suppliers) to make it happen. We know that by working closely together with a shared purpose and values, better things are bound to follow.

Our Aspirations

We want to take the same approach to combating modern slavery as we do for delivering exceptional customer experiences that go beyond banking. That means being straight up, offering heartfelt service and staying red hot relevant.

We are always searching for new ways to tackle modern slavery, challenging everyone we interact with to take action. Transparency is key to eradicating modern slavery and we welcomed the launch of the Government’s Modern Slavery Statement Registry – a central source to enhance accessibility and clarify company action. Our 2021 statement application details the positive steps we’re taking for this cause.

We’ve engaged with the Independent Anti-Slavery Commissioner throughout the year, who published her findings on ‘The role of the financial sector in eradicating modern slavery: CEOs respond to the Independent Anti-Slavery Commissioner.’ We continue to develop our approach, aligned to evolving recommendations and guidance.

Modern slavery is a distressing reality. We believe it’s everyone’s responsibility to change that, and we know that Virgin Money and its people can be a positive force in that cause.

Looking forward, our focus is on further educating the people we identified as playing a vital role in the identification and mitigation of modern slavery-related crimes. This will give them the tools to best support our customers, businesses, and suppliers. We will also perform a risk assessment to test our controls and inform our future approach.

It’s vital that Virgin Money responds to modern slavery in a way that reflects our Purpose of ‘Making you happier about money’ and our values. That means being honest about the prevalence of modern slavery in our ecosystem, taking responsibility for doing something about it, and following through on those commitments.

We’re proud to report we’ve already made a good start, with initiatives such as our aspiration to ensure that by 2030 none of our customers will be paying the poverty premium. This is the extra cost that low-income households pay to access basic services. We know how important it is to support and protect those that have been exploited and we must do away with the premium to remove additional burdens forced upon victims on their road to recovery. However, we know there’s still much more to do.

On behalf of the Virgin Money Board, we confirm our commitment to working with not just colleagues but also our suppliers, customers, and many other stakeholders to continue to drive change and help make modern slavery a thing of the past.

Group Chief Executive Officer

For and on behalf of the boards of Virgin Money UK PLC and Clydesdale Bank PLC

23 March 2022

What do we mean by Modern Slavery?

Modern slavery is a very real and present issue right now, harming some of the most vulnerable people in society.

The term covers all forms of slavery, servitude, forced labour, human trafficking and exploitation for personal or commercial gain. That includes appalling, unacceptable practices like child labour, forced marriage and sex trafficking.

Sadly, it’s all around us but often hidden from sight, as it can be difficult to spot, and many victims don’t identify that way. This makes it hard to measure the true impact, which is likely much larger than we’re aware of.

This statement shares the actions we’ve taken so far to tackle modern slavery, and our commitments on what we intend to do to help combat this offence.

Fast Facts

• 2018’s Global Slavery Index estimated that 40.3 million people lived in modern slavery, with 24.9 million in forced labour.^[1] Measuring the impact is hard, so this number could be much higher.
• There were 7,779 modern slavery crimes recorded by UK police in the year to March 2020. That’s 59% up on the 4,897 cases recorded in the year to March 2019.^[2]

Who is Virgin Money?

We serve over 6.4 million customers across the UK through a digital-first approach. Our leading online and mobile services are supported by telephone and store banking, with a national network of stores and business banking centres. We have hubs in Glasgow and Newcastle Upon Tyne and satellite locations in Leeds, Chester and London.

We offer a full range of products and services for consumers and small and medium sized businesses, delivered through our leading technology platform to provide a consistently world class experience for customers.

We have strong historic brands that we’re bringing together as Virgin Money. We currently trade as Virgin Money, Clydesdale Bank and Yorkshire Bank; however, the Clydesdale and Yorkshire brands are being retired as we introduce customers to our refreshed Virgin Money propositions.

You can find more information on who we are and what we do on our website.

Being a Force for Good

Our ambition at Virgin Money is to drive positive social and environmental impact through everything we do to disrupt the status quo.

We’re focused on where we can make the biggest difference to the environment and society, as a purpose-led business dedicated to Making you happier about money.

As a signatory to the United Nations’ Principles for Responsible Banking, we are committed to aligning our business with the Sustainable Development Goals (and the Paris Agreement on Climate Change). In line with that commitment, we are taking steps to enable us to continually improve our impact and contribution to society and will publicly report on our progress later this year.

Human rights, fair treatment and a world free from slavery, persecution and exploitation should be a given. But they’re not, so we all need to step up and drive the change we want to see.

At Virgin Money we take this responsibility seriously. We’ve set ourselves goals and bold aspirations as part of our ESG strategy, and we’re embedding these in all areas of our business with robust targets, tracking and disclosures. An important aspect of this is managing social and environmental challenges, such as modern slavery.

Virgin Money has a zero-tolerance approach to modern slavery, and we are committed to doing business with honesty and integrity. We believe in treating everyone with dignity and respect and are committed to raising awareness and understanding of these offences to eliminate the practice from our supply chain, customer base and other stakeholder relationships.

This statement is made pursuant to the UK’s Modern Slavery Act 2015 and applies to all of our group companies (Virgin Money UK PLC and its subsidiaries) and all employees and officers of our group companies. It was approved by the boards of directors of Virgin Money UK PLC and its principle operating subsidiary Clydesdale Bank PLC on 24th March 2021.

We’re always evolving and improving how we tackle modern slavery, so we refresh this statement each year (as we are legally required to do). Up until March 2019 our Group published two separate statements, reflective of our corporate structure before the businesses of Virgin Money and Clydesdale Bank came together.

What are we doing about Modern Slavery?

Culture and Strategy

Modern slavery is firmly on our Board and Senior Management agenda, driving our zero-tolerance approach to modern slavery from the top down through all of Virgin Money.

Our goal is to consider modern slavery at every significant decision point or gateway, ensuring every colleague is empowered and committed to acting on any concerns they identify. This means incorporating the risks of modern slavery into how we assess, manage and protect customers, stakeholder relationships and suppliers.

Detect and Disrupt

We comply with the relevant laws and practices on how we should treat colleagues, customers and stakeholders (such as paying the voluntary living wage). But our role extends beyond that, to the business practices and behaviours of everyone in our entire business ecosystem.

Modern slavery could appear in our suppliers’ businesses, or further down the supply chain through the suppliers of our suppliers.

Our products and services could be used by modern slavery offenders, like slavery gangs and people traffickers.

Criminals may try to exploit our colleagues or customers in their efforts to launder their money and engage in financial crime.

It’s vital that everyone in our business knows when, where and how to look for signs of modern slavery, supported with the right processes, systems and controls to make sure we do everything possible to stamp it out for good, wherever it exists.

Policies, Process and Risk

We give our people a framework of policies, processes and technical standards to run Virgin Money safely and effectively.

There are measures and guidance designed to help us identify, assess and combat all aspects of financial crime, including money laundering, which is sometimes linked to modern slavery.

We’re committed to reviewing our Group Anti-Money Laundering & Counter Terrorist Financing Policy Standard this year to ensure we have the right controls in place for mitigating Financial Crime Risks. These controls support the mitigation of modern slavery-related offences in our operations.

We manage modern slavery risks in our customer relationships by doing our due diligence while onboarding and then refreshing the customer data we hold periodically throughout the customer lifecycle.

We monitor customer account activity to identify suspicious activity which might indicate modern slavery. Where there’s cause for concern, we make extra checks and follow the necessary reporting. This might be escalating to the National Crime Agency or the Banking Protocol – an initiative between banks, the police and trading standards which aims to identify vulnerable victims or suspicious activity, helping prevent crimes such as modern slavery. It could even be both, depending on the situation.

We work closely with external agencies and law enforcement, as well as attending industry meetings to stay on top of emerging modern slavery trends. The intelligence we get from this helps us strengthen our capabilities to recognise red flags in customers’ transactional behaviours.

We continue to monitor existing, new and emerging modern slavery risks in our business, updating and establishing new policies and processes to help us react appropriately.

Training and Awareness

We provide a suite of learning showing the knowledge, behaviours and practices that are important to a purpose-led business like ours.

Our mandatory ‘Risks in Banking’ learning is an all-encompassing online risk course educating our people on financial crime, fraud awareness, market abuse and whistleblowing.

‘Risks in Banking’ includes an anti-money laundering training module, raising awareness of all financial crime risks. We updated it this year to cover modern slavery, with guidance on spotting red flags. It includes an example of modern slavery to bring the topic to life for colleagues, before they complete an assessment at the end of the module to make sure they’ve fully understood the training. We’ll share the revised module with c.8,400 employees in spring of this year to raise awareness across our organisation of modern slavery and the ways in which we may recognise it. We review the module every year, so it stays aligned with legislative requirements and market practices, along with internal policy and process changes.

We’ve also identified several business units in Virgin Money where additional bespoke training on modern slavery is appropriate. Everyone should have knowledge and awareness of these offences, as covered in the mandatory training, but our front-line operations and risk functions play a vital role in the identification and escalation of modern slavery. We’re committed to ensuring our processes are fit for purpose, helping us create bespoke learning that best equips new and existing front-line colleagues to identify, manage and report suspicious related activity.

Suppliers and Stakeholders

We function in a responsible, ethical, open and transparent way, so it’s no surprise that we expect the same from the suppliers and stakeholders we work with. We want to ensure they uphold the same standards as we do, encouraging greater transparency within company supply chains to stamp out modern slavery-related offences.

Suppliers

Virgin Money has an extensive supplier base. We operate a risk-based approach to initial and ongoing due diligence which includes a review of suppliers’ ethical and social responsibility credentials. Our robust sourcing and due diligence processes are continually reviewed to ensure they are fit for purpose and reflective of current risks.

Our Supplier Code of Conduct sets out the standards, principles and behaviours we expect from our suppliers. Above all, we want to do right by our people. We protect and respect human rights and essential labour standards, including the International Labour Organisation Core Conventions. We expect our suppliers to be as committed as we are in embracing vital regulation such as the Modern Slavery Act 2015. Our top tier suppliers must positively affirm they’ve read and will comply with our code. We’re ready and waiting to work through any challenges our suppliers are facing.

Compliance relies on teamwork and, as a member of the ‘Financial Services Qualification System’ community, we’ve agreed with other banks a standardised approach to information-gathering to ensure policy compliance. We invite all our key suppliers to join this service. Currently, 180 of our suppliers share information with us as part of the system, and the level of information requested and shared by each supplier varies based on the risk classification of the products and services they provide. We use this as part of our Supplier Relationship Management process, providing oversight of each supplier’s compliance with our internal policies and governance controls.

We are also a member of Slave Free Alliance Link opens in a new window, a membership scheme for businesses to improve transparency across their supplier base. As we’ve said, compliance relies on teamwork, and we’ve been engaging with them to increase our own awareness and to understand how best we can support our supplier base.

Other Stakeholders

When we work with recruitment services, we make sure our suppliers apply the same high standards that Virgin Money does. Verifying ID, the right to work in the UK, and running criminal background and credit checks helps us learn who we’re employing to identify whether someone is connected to modern slavery-related activities, as perpetrator or victim.

We want everyone to feel happier about money, but we rely on the people we work with (like our suppliers) to make it happen. We know that by working closely together with a shared purpose and values, better things are bound to follow.

Our Aspirations

We want to take the same approach to combating modern slavery as we do for delivering exceptional customer experiences that go beyond banking. That means being straight up, offering heartfelt service and staying red hot relevant.

We should always search for new ways to tackle modern slavery, and really challenge everyone we interact with to take action. That’s why we welcome the Independent Anti-Slavery Commissioner’s review within the financial services sector on ‘Preventing Modern Slavery and Human Trafficking Link opens in a new window’. We’re closely reviewing the outputs of the recommendations and will evolve our approach, aligned to these.

Modern slavery is a distressing reality. We believe it’s everyone’s responsibility to change that, and we know that Virgin Money and its people can be a positive force in that cause.

During the next year, our focus will be on educating our people, equipping them with the tools to best support the customers, businesses and suppliers we work with.

We’ve mobilized a working group focused on solving these issues and will update you later this year on our progress.

It’s vital that Virgin Money responds to modern slavery in a way that reflects our Purpose of ‘Making you happier about money’ and our values. That means being honest about the prevalence of modern slavery in our ecosystem, taking responsibility for doing something about it, and following through on those commitments.

We’re proud to report we’ve already made a good start, with initiatives such as our aspiration to ensure that by 2030 none of our customers will be paying the poverty premium. This is the extra cost that low income households pay to access basic services. We know how important it is to support and protect those that have been exploited and we must do away with the premium to remove additional burdens forced upon victims on their road to recovery. However, we know there’s still much more to do.

On behalf of the Virgin Money Board, we confirm our commitment to working with not just colleagues but also our suppliers, customers and many other stakeholders to continue to drive change and help make modern slavery a thing of the past.

Group Chief Executive Officer

For and on behalf of the boards of Virgin Money UK PLC and Clydesdale Bank PLC

24 March 2021

Virgin Money UK PLC (‘Virgin Money UK’ or ‘the Bank’), together with its subsidiary undertakings (which together comprise ‘the Group’), is an independent banking group operating under the Clydesdale Bank, Yorkshire Bank, and Virgin Money brands. This statement relates to the subsidiaries Virgin Money PLC and Clydesdale Bank PLC.

CYBG PLC (now Virgin Money UK PLC, following a name change on 31 October 2019) acquired Virgin Money PLC on 15 October 2018 and is in the process of unifying and integrating the operations of the two heritage banks. On 21 October 2019, the Group completed the legal process to operate under a single authorised and regulated banking entity, at which point all policies were unified. Until that point, CYBG PLC and Virgin Money PLC adhered to each entity’s separate policies as described in the 2018 Modern Slavery statement. The 2019 statement reflects the total operations under Virgin Money UK PLC during 2019 (pre and post attaining the single banking licence) and the approach for 2020 and beyond.

Our Business

We serve over six million customers across the UK through a multi-channel model of online, mobile and telephone banking. Our ambition is to offer the best service in UK banking, providing customers with market-leading functionality and innovative products, supported by robust technology and a first class, personal customer experience.

We have offices in Glasgow, Leeds, Newcastle upon Tyne, Edinburgh, London, Norwich and Chester.

Our Customers

The bank executes due diligence processes to mitigate risks in our relationships with both new and existing customers who open and maintain bank accounts and other financial products and services with us. These processes include anti-money laundering Know Your Customer (KYC) checks made both at the point of account opening and periodically throughout the customer relationship.

Policies and Controls

Virgin Money UK complies with legislation and good employment practices when engaging and on-boarding employees. This is reflected in our commitment to pay the voluntary living wage to our employees. All relevant policies and processes are regularly reviewed to ensure we are compliant with legislation and good practice when engaging and on-boarding employees and suppliers.

We are participants in the Banking Protocol with two main aims; making sure our customers are protected from fraud and helping to identify customers who could be exposed to potential fraud or modern slavery activity. Throughout 2019, Virgin Money UK continued to ensure colleagues benefitted from business wide communications raising awareness of these issues and the actions in place to address the challenges and will maintain this focus moving forward.

We are currently creating a combined approach in all business areas which will be adopted during this period of integration to enforce effective systems and controls to mitigate risk and minimise the impact of slavery and human trafficking within our business and across our supplier base.

Identifying Modern Slavery and Human Trafficking

Virgin Money UK is an active member of the Financial Services Qualification System, which all key suppliers will be invited to join. Contained within the initial risk assessment that suppliers complete are questions on compliance with the Modern Slavery Act including requesting confirmation from relevant suppliers that they have or intend to publish their own modern slavery statement. Throughout 2020, we will continue to gather collateral, create dashboard reporting and take action where necessary based on information provided by suppliers.

Training

Virgin Money UK ensures that colleagues who have direct contact with customers understand what modern slavery is and can identify the signs of someone who may be involved in slavery. This training has been completed by numerous colleagues including those in our store and lounge network and our fraud and financial crime team.

During 2020 and beyond, colleagues across the bank will receive training on our updated policies and processes impacting or informing our approach to modern slavery.

Our Supplier Base

Virgin Money UK relies on suppliers to support the delivery of high-quality services to our customers and the Group and, in doing so, we expect all our suppliers to operate in a responsible, ethical, open and transparent way and in compliance with all applicable laws and regulations.

Virgin Money UK has an extensive supply base. We adopted a unified approach to initial and ongoing due diligence on 21 October 2019 which ensures we undertake a deep review of our suppliers’ ethical and socially responsible credentials. Prior to this, CYBG PLC and Virgin Money PLC both adhered to due diligence processes as covered in previous Modern Slavery Statements. Our robust sourcing and due diligence processes are continually reviewed to ensure they are reflective of the relevant and current risks.

Our Supplier Code of Conduct sets out the standards, principles and behaviours we expect from third party providers to the banks. This places the expectation on our suppliers to operate ethically and with integrity in all our business dealings and relationships and to implement and enforce effective systems and controls.

We take a risk-based approach to supplier management which results in certain suppliers completing a questionnaire on their approach to identifying and managing Modern Slavery risks within their business. The questionnaire includes establishing information on any risk assessments they conduct, their own terms and conditions with their own suppliers and employee training. Where responses highlight a higher degree of risk then additional information is requested in respect of establishing if there are relevant policies and procedures in place to ensure compliance with the Modern Slavery Act

Raising Awareness

Suppliers

We continue to raise awareness of modern slavery with our suppliers and local businesses.

We routinely issue a questionnaire to our key suppliers that includes a link to our Supplier Code of Conduct. These suppliers must positively affirm that they have read and comply with the Code. The Code sets out our expectations with regard to Modern Slavery.

Virgin Money UK works with suppliers on an ongoing basis to ensure they are aware of the importance of the issue and that they are taking appropriate action, irrespective of whether they are a small business, or a large company required to publish a modern slavery statement.

Other Stakeholders

When we work with recruitment services, we make sure our suppliers apply the same high standards that Virgin Money does. Verifying ID, the right to work in the UK, and running criminal background and credit checks helps us learn who we’re employing to identify whether someone is connected to modern slavery-related activities, as perpetrator or victim.

We want everyone to feel happier about money, but we rely on the people we work with (like our suppliers) to make it happen. We know that by working closely together with a shared purpose and values, better things are bound to follow.

Colleagues

Training is central to identifying the risk of modern slavery and taking appropriate action, both during the sourcing process and throughout the contractual relationship. Training is available for all colleagues through the online training portal.

In 2020 we will deliver a further awareness campaign to our customer facing colleagues and supplier relationship managers on modern slavery. We will review training opportunities in sectors deemed as heightened risk to both raise awareness of the Modern Slavery Act and help suppliers achieve a higher standard of compliance.

Looking to the Future

We will continue to use our influence to bring attention to modern slavery amongst our suppliers and colleagues. Virgin Money UK is a member of Slave Free Alliance, a membership scheme for businesses to improve transparency across their supplier base. Benefitting from their experience, we will focus at a deeper level of the supplier base and provide ongoing training to colleagues to demonstrate ethical best practise.

This statement has been published pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes Virgin Money UK’s slavery and human trafficking statement for the 2019 financial year. It has been approved by the Board of Directors and will be reviewed annually.

Group Chief Executive Officer

CEO CYBG PLC GROUP

March 2020

Both Virgin Money PLC (since October 2018) and Clydesdale Bank PLC are part of CYBG PLC. CYBG PLC is an independent banking group. This statement reflects the achievements of both Clydesdale Bank PLC (trading through the Clydesdale Bank, Yorkshire Bank and B Brands), its subsidiaries Yorkshire Bank Home Loans Limited and Clydesdale Covered Bonds No 2 LLP and Virgin Money PLC (trading through the Virgin Money Brand) during 2018 and the combined vision for the CYBG PLC banking group for 2019 and beyond. We will now refer to both Clydesdale Bank PLC and Virgin Money PLC collectively as ‘the banks’.

Our Business

We serve over six million customers across the UK through an omni-channel model of online, mobile and telephone banking and we have a national network of 250 branches and business banking centres. Our ambition is to offer the best service in UK banking, providing customers with market-leading functionality and innovative products, supported by robust technology and a first class, personal customer experience.

Our main offices are in Glasgow, Leeds, Newcastle upon Tyne, Edinburgh, London, Norwich and Chester

Socially responsible business operations should be the intrinsic foundation in which banking operates. This is reflected in Virgin Money’s recent accreditation as a Living Wage Employer, paying a wage that is calculated according to the basic cost of living in the UK to all colleagues, contractors and suppliers who work on Virgin Money sites. Clydesdale Bank has, since 2016, paid all salaries above the pay recommended by the Living Wage Foundation.

Our Customers

The banks currently have separate due diligence processes in place to mitigate risks in our relationships with both new and existing customers who open and maintain bank accounts with us. These processes include Industry-wide Anti- Money Laundering Know Your Customer (KYC) checks made both at the point of account opening and periodically throughout the customer relationship. These processes will be harmonised across the banks during integration.

Policies and Controls

In 2018, the banks separately built on existing policies and controls. As an example, Virgin Money introduced a cross- functional Modern Slavery Network, drawing on expertise from across the business to drive co-ordination and oversight of modern slavery activity. This network is the forum to share knowledge and identify and initiate any additional opportunities to strengthen our approach to combat modern slavery.

The banks are committed to complying with legislation and good employment practices when engaging and on- boarding employees. All relevant policies and processes will be reviewed to ensure we deliver against the combined organisation’s commitment to compliance with legislation and good practice when engaging and on-boarding employees and suppliers.

The banks are participants in the Banking Protocol with two main aims; making sure our customers are protected from fraud and helping to identify customers who could be exposed to potential fraud or modern slavery activity. Throughout 2018 the banks separately ensured colleagues benefitted from business wide communications raising awareness of these issues and the actions in place to address the challenges.

In the future, a combined approach will be adopted across the banks to enforce effective systems and controls which minimise the risk of slavery and human trafficking within our business and across our supplier base

Identifying Modern Slavery and Human Trafficking

Virgin Money is a member of the Joint Money Laundering Intelligence Taskforce which has a number of operational priorities including ‘understanding and disrupting the funding flows linked to organised immigration crime, human trafficking and modern slavery.’ In line with this we have a number of mechanisms in place to help us identify and highlight customers and employees of suppliers who may be involved in modern slavery including: colleague training; procedures for raising concerns to the Financial Crime team; referrals to the National Crime Agency (NCA).

Clydesdale Bank is an active member of the Financial Services Qualification Scheme, which all key suppliers have been invited to join. Contained within the initial risk assessment that suppliers complete are questions on compliance with the Modern Slavery Act including requesting confirmation from relevant suppliers that they have or intend to publish their own modern slavery statement. We are now gathering collateral, creating dashboard reporting and taking action where necessary based on information provided by suppliers.

Training

During 2018, Virgin Money extended the reach of our training programme, ensuring that colleagues who have direct contact with customers understand what modern slavery is and can identify the signs of someone who may be involved in slavery. This training has been completed by numerous colleagues including those in our branch and Lounge network and our Fraud and Financial Crime team.

Clydesdale Bank include modern Slavery content within Financial Crime learning which all front office customer facing staff complete to develop their awareness of what constitutes criminal activity and the indications of this. This training is specifically tailored to audience needs and has been delivered through different mediums depending on requirements.

During 2019 and beyond, colleagues across the banks will receive training on our updated policies and processes impacting or informing our approach to modern slavery

Our Supplier Base

The banks rely on the use of suppliers to support the delivery of high quality services to our customers and the Group, and in doing so we expect all our suppliers to operate in a responsible, ethical, open and transparent way and in compliance with all applicable laws and regulations.

The ongoing integration of the supply bases of Virgin Money and Clydesdale Bank will change the composition of third parties working with the banks. In turn, this will require a further risk assessment to ensure any exposures are fully understood and appropriately addressed. This gives us the opportunity for a deep review of our suppliers’ ethical and socially responsible credentials.

The banks separately have robust sourcing and due diligence processes. These are continually reviewed to ensure they are reflective of the relevant risks. Moving forward, a single approach across the banks will ensure a consistent and thorough assessment of a supplier’s approach to modern slavery, both at sourcing and throughout the life of our relationship with critical, strategic and outsource suppliers.

Our respective supplier codes of conduct set out the standards, principles and behaviours we expect from third party providers to the banks. This places the expectation on our suppliers to operate ethically and with integrity in all our business dealings and relationships and to implement and enforce effective systems and controls. From 2019, the banks will adopt a single supplier code of conduct.

Raising Awareness

We continue to raise awareness of modern slavery with our suppliers and local businesses. In 2018 Virgin Money held an awareness event with a group of businesses in the construction industry, drawing attention to the risk of modern slavery across industries and providing information to support them in driving change.

To recognise Anti-Slavery Day, Virgin Money held a series of educational events for the wider business to learn more about the issue and how Virgin Money are tackling it, and we published an article to help colleagues understand how they can make a difference both at work and at home.

Clydesdale Bank implemented a supplier communication and verification programme to confirm that suppliers have received and understood the bank’s position regarding modern slavery and are additionally aware of our supplier code of conduct. A series of training communications was directed to internal staff highlighting the issues of modern slavery and human trafficking and how we mitigate potential concerns to look for within our supply chain engagement.

The banks work with suppliers on an ongoing basis to ensure they are aware of the importance of the issue and that they are taking appropriate action, irrespective of whether they are a small business, or a large company required to publish a modern slavery statement

Measuring Our Success

We measure our success in delivering on our priorities around modern slavery against the following indicators:

Supply Chain Risk Assessment

The annual risk assessment at Virgin Money identifies a number of suppliers for whom further information is required to satisfy ourselves that appropriate action is being taken to address the modern slavery risks inherent to their business. During 2018, the risk assessment focused on a deeper understanding of a small number of key suppliers. This remains ongoing.

The banks will align and further develop supply chain due diligence, related human rights programme and auditing process in order that any instances of modern slavery can be identified, and remedial action taken.

Colleague Awareness

Training is central to identifying the risk of modern slavery and taking appropriate action, both during the sourcing process and throughout the contractual relationship. A total of 616 Virgin Money colleagues received training through the online training portal during 2018, and supplier relationship managers and procurement colleagues received face to face training.

In the future the banks will deliver a further internal focused awareness campaign to our supplier relationship managers on modern slavery. We will review training opportunities in sectors deemed as heightened risk to both raise awareness of the Modern Slavery Act and help suppliers achieve a higher standard of compliance.

Looking to the Future

We will continue to use our influence to bring attention to modern slavery amongst our suppliers and colleagues. Clydesdale Bank has recently become a member of Slave Free Alliance, a membership scheme for businesses to improve transparency across their supplier base. Benefitting from their experience, the banks will focus at a deeper level of the supplier base and provide ongoing training to colleagues, turning an emerging business threat into a demonstration of ethical best practise.

This statement has been published pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes Clydesdale Bank and Virgin Money’s slavery and human trafficking statement for the 2018 financial year. It has been approved by the Board of Directors and will be reviewed annually.

Group Chief Executive Officer

CEO CYBG PLC GROUP

March 2019