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Code of ethics

Purpose of Code of Ethics
Introduction
Conflicts of Interest
Bribery
Accurate Periodic Reports and Other Public Communications
Consultation, Disclosure and Approval

Appendix A: Gifts and Hospitality Policy

1. Purpose of Code of Ethics

The purpose of this Code of Ethics is:

to promote the honest and ethical conduct of our corporate employees, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
to promote full, fair, accurate, timely and understandable disclosure in periodic reports required to be filed by Mitchells & Butlers plc (the "Company");
and to promote compliance with all applicable rules and regulations that apply to the Company and its officers.

2. Introduction

This Code of Ethics is applicable to all corporate employees and Licensed House Managers. References in this Code of Ethics to the Company means the Company or any of its subsidiaries.

We expect honest and ethical conduct in all aspects of our business from all of our employees who are expected to foster a culture of transparency, integrity and honesty. As a good corporate citizen, the Company expects the highest standard of behaviour at all times. No individual should be party to any transaction or communication which is considered to breach, or is likely to breach, any law or regulation irrespective of whether there is either any direct impact on the Company or personal gain. Compliance with this Code is a condition of employment and any violations of the Code may result in disciplinary action, up to and including termination of your employment.

3. Conflicts of Interest

A conflict of interest occurs when your private interests interfere, or appear to interfere, in any way, with the interests of the Company as a whole. Conflicts of interest can also arise when you take action or you or a member of your family have interests that may make it difficult for you to perform your duties to the Company effectively.

Although it is not possible to list every conceivable conflict, the following are some common examples that illustrate actual or apparent conflicts of interest that should be avoided:

Improper Personal Benefits from the Company

Conflicts of interest arise when an employee or a member of his or her family receives improper personal benefits as a result of his or her position in the Company. You may not accept any benefits from the Company that have not been approved pursuant to Company policy and procedure, including any Company loans or guarantees of your personal obligations. Any gifts or hospitality from existing or potential third party suppliers of goods of services to the Company should only be accepted in accordance with the Company's policy on such which can be found at Appendix A.

Financial Interests in Other Businesses

You should avoid having an ownership interest in any other enterprise if that interest compromises or appears to compromise your loyalty to the Company. For example, you may not own an interest in a company that competes with the Company or that does business with the Company (such as a supplier) unless you obtain approval before making any such investment. Please see paragraph 6 below for details of the appropriate procedure that should be followed. However, it is not typically considered, and the Company does not consider it, a conflict of interest (and therefore prior written approval is not required) to make investments in competitors, customers or suppliers that are listed on a national or international securities exchange so long as the total value of the investment is less than one percent (1%) of the outstanding share capital of that company and the amount of the investment is not so significant that it would affect your business judgment on behalf of the Company.

Business Arrangements with the Company

Without prior written approval, you may not participate in a joint venture, partnership or other business arrangement with the Company.

Company Opportunities

If you learn of a business or investment opportunity through the use of Company property or information or your position at the Company, such as from a competitor or actual or potential supplier or business associate of the Company (including a principal, officer, director or employee of any of the above), you may not participate in the business or make the investment without prior written approval. Such an opportunity should be considered an investment opportunity for the Company in the first instance.

Outside Employment or Activities with a Competitor

Simultaneous employment with, or serving as a director of a competitor of the Company, is strictly prohibited, as is any activity that is intended to or that you should reasonably expect could advance a competitor's interests at the expense of the Company's interests. You may not market products or services in competition with the Company's current or potential business activities. It is your responsibility to obtain approval to determine whether a planned activity will compete with any of the Company's business activities before you pursue the activity in question.

Outside Employment with a Supplier

Without prior written approval, you may not be a supplier or be employed by, serve as a director of or represent a supplier to the Company. Without prior written approval, you may not accept money or benefits of any kind from a third party as compensation or payment for any advice or services that you may provide to a client, supplier or anyone else in connection with its business with the Company.

Family Members Working in the Industry

If your spouse or partner, your children, parents, or in-laws, or someone else with whom you have a family relationship is a competitor of, or supplier to the Company or is employed by one, you must disclose the situation so that the Company may assess the nature and extent of any concern and how it can be resolved. You must carefully guard against inadvertently disclosing Company confidential information and being involved in decisions on behalf of the Company that involve the other enterprise.

If you have any doubt as to whether or not conduct would be considered a conflict of interest, please consult with the Company Secretary and General Counsel.

Private Use of Company Suppliers

The use of Company Suppliers¹ of goods and services for private use must be approved in accordance with paragraph 6 below, unless such use is on retail terms that are widely available to the general public.

Confidential Information

Confidential information received should not be used for personal gain and information given should be accurate and not misleading.

4. Bribery

The company takes a zero tolerance approach to bribery and all employees are required to comply with the Bribery Policy which is available on the intranet or on request from the Company Secretary & General Counsel.

5. Accurate Periodic Reports and Other Public Communications

As you are aware, full, fair, accurate, timely and understandable disclosure in our periodic reports and in our other public communications is required and is essential to our continued success. Please exercise the highest standard of care in preparing such materials. We have established the following guidelines in order to ensure the quality of our periodic reports.

All Company accounting records, as well as reports produced from those records, must be kept and presented in accordance with the laws of each applicable jurisdiction.
All records must fairly and accurately reflect the transactions or occurrences to which they relate.
All records must fairly and accurately reflect in reasonable detail the Company's assets, liabilities, revenues and expenses.
The Company's accounting records must not contain any false or intentionally misleading entries.
No transaction may be intentionally misclassified as to accounts, departments or accounting periods or in any other manner.
All transactions must be supported by accurate documentation in reasonable detail and recorded in the proper account and in the proper accounting period.
No information may be concealed from the internal auditors or the independent auditors.
Compliance with Generally Accepted Accounting Principles and the Company's system of internal accounting controls is required at all times.

6. Consultation, Disclosure and Approval

Where this Code requires you to consult, disclose, or obtain approval for any transaction or circumstance the following procedure should be followed:

Executive Committee members should consult with, disclose to, or obtain the written approval of the Chief Executive Officer.
All other employees should consult with, disclose to, or obtain the written approval of the Company Secretary.

Appendix A: Gifts and Hospitality Policy

The provision of gifts and hospitality are relatively common when doing business and are not unlawful. However, gifts, hospitality and political or charitable donations will be bribes if they are given or received with the intention of influencing business decisions.
It is therefore important for Mitchells & Butlers to clearly set out its policy on what is and what is not acceptable, taking into account the particular nature of its business, accepted practice within the industry and the countries in which it operates.
You should assume that all dealings will become public knowledge and must be capable of standing up to rigorous scrutiny.
Except as described in paragraphs 12, 13 and 15 or in support of approved charitable events, the soliciting of gifts and / or hospitality is prohibited.
Except as described in paragraph 15, gifts and / or hospitality should not be offered to, or accepted from any third party that is not currently a supplier of goods or services to Mitchells & Butlers.
Gifts / hospitality should not be offered to, or accepted from, government officials or representatives, or politicians or political parties, without the prior approval of the Company Secretary & General Counsel.
During any negotiations with existing or potential suppliers, service providers, local or central government agencies or any other third party no hospitality, gifts or entertainment whatsoever should be accepted or given to ensure that Mitchells & Butlers can not be said to have been influenced or perceived to have been influenced in making a business decision as a consequence.
All gifts or hospitality must be approved in writing by the immediate line manager.
All gifts received should be provided to Mitchells & Butlers for disposal, typically by raffle or auction, with all proceeds to be provided to an approved charity supported by the Company.
Subject to paragraphs 3 to 19, a gift should only be given or received if all of the following requirements are met:
- it is not made with the intention of influencing a third party to obtain or retain business or a business advantage, or to reward the provision or retention of business or a business advantage, or in explicit or implicit exchange for favours or benefits;
- it does not include cash or a cash equivalent (such as gift certificates or vouchers);
- it is appropriate in the circumstances. For example, it is customary for small gifts to be given at Christmas time;
- taking into account the reason for the gift, it is of an appropriate type and value and given at an appropriate time;
- it is given openly, not secretly; and
- it is only of small intrinsic value.
The receipt or giving of modest hospitality, whilst it is an accepted courtesy, should not be of a frequency or scale significantly greater than that which would be provided in return.
Subject to paragraphs 3, 5 to 10 it is acceptable for third parties to sponsor or fund (in whole or in part) incentive awards to our employees (including the provision of accommodation and hospitality greater than the employee would be expected to provide in return) provided that:
- the event provides a clear and justifiable commercial benefit to Mitchells & Butlers, and
- written approval has been obtained from the relevant Executive Committee member (and from the Chief Executive where an Executive Committee member attends the event).
Subject to paragraphs 3, 5 to 10, it is acceptable for third parties to sponsor or fund (in whole or in part) internal conferences, team meetings, awards events and trade shows (including the provision of hospitality greater than would be provided in return) provided that prior written approval has been obtained from the Commercial Director (and from the Chief Executive Officer in respect of such events outside of the United Kingdom).
Subject to paragraphs 3 to 11, it is acceptable to attend industry events such as conferences, annual dinners or awards evenings at the invitation of third parties (including the provision of accommodation for the employee only for one night only) provided that prior written approval has been obtained from the Commercial Director (and from the Chief Executive Officer in respect of such events outside of the United Kingdom).
Subject to paragraphs 3 and 6 to 11, it is acceptable to perform trade visits to experience relevant industry products, services or customer offerings at the invitation of third parties provided that:
- accommodation is not provided by the third party;
- attendance at the trade visit provides a clear and justifiable commercial benefit to Mitchells & Butlers, and
- written approval has been obtained from the relevant line manager.
Subject to paragraphs 3 to 11 the test to be applied is whether in all the circumstances the gift or hospitality is reasonable and justifiable. The intention behind the gift or hospitality should always be considered.
Employees must ensure that all gifts and hospitality received or given are approved in accordance with this Policy prior to the giving or receiving of the gift or hospitality. Each Executive Committee member is responsible for maintaining a log of all gifts and hospitality received or given for all individuals in their respective functions.
It is not necessary to obtain approval for and to log low value hospitality that is incidental to a normal business activity. Examples include:
- employees may be invited to attend training courses or seminars as part of their continuing professional development at no charge at which breakfast or lunch are provided.
- employees may provide or receive modest meals or drinks to and from third parties including suppliers or service providers.
Finally, given the diverse nature of business relationships, it is neither possible nor appropriate to document every eventuality. However, it should be understood that employees shall never use their position or authority for personal gain and should reject any business practice which might reasonably be deemed improper.
Failure to comply with the policy and practice set out above may result in disciplinary action being taken against the employee

¹ Examples include Building Contractors and Suppliers of Equipment, Furniture, Fixtures & Fittings

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