Mastercard : 2023 Environmental, Social and Governance Report

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MASTERCARD 2023 ESG REPORT

INTRODUCTION

ENVIRONMENT

OUR PEOPLE

SUPPLIERS

CUSTOMERS

COMMUNITIES

GOVERNANCE

DATA TABLES

APPENDIX

INTRODUCTION

CEO letter

About Mastercard

Our ESG strategy

Our ESG governance Stakeholder engagement

ESG materiality

Recognition

Environment

ENVIRONMENT

Operational environmental footprint

Climate resilience

Environmentally focused solutions

Social

OUR PEOPLE

CUSTOMERS

Culture

Use of our network

Talent attraction	Privacy, data
		responsibility and
		security
Equity and inclusion in
COMMUNITIES
the workplace
		Financial inclusion
Talent development
		Inclusive product
Rewards, benefits and	design
well-being
		Community giving
Workplace experience
and volunteerism
SUPPLIERS
Human rights
Responsible sourcing

Governance

GOVERNANCE

DATA TABLES

Ethics and compliance

General

Policy engagement	Environmental
and political activity
	Social

Governance

APPENDIX

About this report

Assurance letters

Sustainable Development Goals

SASB index

GRI index

TCFD index

Mastercard's ESG disclosures:

Forward-looking statements and other disclaimers are available on page 87 of this report.

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Aspiration by itself does not become a reality. It takes a plan, passion and commitment.

Our company's aspiration is to power economies and empower people, building a sustainable economy where everyone prospers. Every day, our dedicated teams around the world are focused on addressing real needs and building toward this goal. They bring their creativity, their knowledge and their unique perspectives to drive innovation and our business in meaningful ways.

Our network connects billions of people and businesses to the digital economy - from multinational corporations to small mom- and-pop shops in the Global South. Our services help businesses build loyalty, make smarter decisions and deliver the security and peace of mind all of us expect. Our strong partnerships - with like-minded companies, academic institutions, nonprofits and public sector agencies - add to our innovations, scale and impact.

All three of these elements - our network, services and partnerships - drive our commitment of doing well by doing good. For example, smallholder farmers in Africa and India are using our Community Pass digital platform to access loans and receive better prices for their crops through a network of financial institutions and agricultural partners. We also tapped into our partnerships across many industries to help small businesses thrive through our Strive programs, providing restaurants, retailers

and many others with payments tools, funding, cybersecurity and e-commerce capabilities. These initiatives support social good and strengthen our business - not just one or the other.

We know that we can only prosper when the world prospers. That comes when growth is sustainable and inclusive and when prosperity is shared.

That is why reports like this one are valuable. They allow us to reflect on our impact and the progress we've made against our goals. As importantly, reports like this give us a view into where there is an opportunity to do more.

The following pages illustrate the journey we are on and the standards we hold ourselves to. We invite you to explore these details, share your thoughts and identify areas where we may work together to have an even greater impact. How we deliver on our

purpose and aspirations makes us a better company for our customers, partners, governments, consumers and

our stockholders.

This work has never been more challenging or more important. We are committed to it because it is the right thing to do for our business and for the world. We embrace that responsibility.

MICHAEL MIEBACH

CEO, MASTERCARD

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Our ESG strategy

At Mastercard, we're powering economies and empowering people, building a sustainable economy where everyone prospers. Environmental, social and governance (ESG) matters are core to our business strategy and are fundamental for driving long-term value for our stockholders. We leverage

our employees, technology, resources, partnerships and expertise to drive positive, lasting impact while at the same time creating markets for the future. Our ESG strategy is expressed through three pillars - People, Prosperity and Planet - and all the

People

Empowering people to reach their

full potential

We are creating an inclusive workplace where everyone has an opportunity to succeed, enabled by a culture of inclusion and belonging and reflective of the diverse communities

we serve.

Prosperity

Fostering prosperity around

the world

We are focused on

helping everyone participate

equitably in the digital

economy, connecting people to the tools and resources that can help them chart pathways to prosperity for their families, communities and beyond.

Planet

Preserving the planet for

future generations

We are driving our business

toward net zero emissions and accelerating the transition to a low-carbon, regenerative economy, because we all need a healthy planet to succeed.

work we do is grounded in strong governance principles.

Governance principles

Securing trust

We are committed to a culture of ethics and compliance that is grounded in honesty, decency, trust and personal

accountability, and we are committed to adhering to the highest standards in protection and use of data.

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Our ESG goals and progress

To further our ESG strategy and drive impact, we have set ambitious goals focused on People, Prosperity and Planet, including achievable steps toward our long-term vision of a sustainable economy where everyone prospers.

		GOAL	PROGRESS
	Equity and inclusion in	Close the gap between female and male global median pay at Mastercard.	We increased the global median pay for female employees to 96.4% of the
	the workplace		median pay for male employees, up 1.7% from 2022.1
People	Equity and inclusion in	Toward our In Solidarity aspirational goal, grow U.S. Black leadership at the	We grew the number of U.S. Black leaders at vice president level and above
the workplace	vice president level and above at Mastercard by 50% by 2025, from 2020.	from 72 to 80 - a year over year increase of 11% - in 2023. Since 2020,
community giving	in the U.S. to help close the racial wealth and opportunity gap by 2025,	than $511 million in Black communities in the U.S., exceeding our goal two
			the percentage of Black representation in leadership has grown by 13%.
	Responsible sourcing,	As part of our In Solidarity initiative, invest $500 million in Black communities	Since we launched our In Solidarity initiative in 2020, we have invested more
		from 2020.	years early.
	Community giving	Educate 5 million girls, ages 8-16, in STEM through our Girls4Tech™ program	We have educated 6.8 million girls through our Girls4Tech curriculum since
		by 2025, from 2014.	the program's launch in 2014, exceeding our goal two years early.
	Financial inclusion	Connect 1 billion people to the digital economy by 2025.	Working with our partners, we connected more than 85 million people to the
			digital economy in 2023 and more than 870 million since 2015.
Prosperity	Financial inclusion	Connect 50 million micro, small and medium enterprises (MSMEs) to the	We connected 13 million MSMEs to the digital economy through card
	digital economy through card acceptance by 2025, from 2020.	acceptance in 2023 and 48 million since 2020.
	Financial inclusion	Provide 25 million women entrepreneurs with solutions that can help them	Through 2023, we provided 37 million women entrepreneurs with solutions
		grow their businesses by 2025, from 2020.	that can help them grow their businesses, exceeding our goal early.
	Financial inclusion	Register 30 million users on the Community Pass platform by 2027.	We registered 5 million users on the Community Pass platform through 2023.
	Financial inclusion	Through our global Strive initiative to support small businesses, reach 18	We reached 12 million micro and small businesses via our Strive initiative
		million micro and small businesses to help build their capacity, unlock access	through 2023.
		to capital and drive adoption of digital tools.
Planet	Operational	Reduce Mastercard's absolute emissions by our science-based targets of 38%	In 2023, Mastercard's Scope 1 and 2 emissions were 48% less than in 2016,
environmental	for Scope 1 and 2, and 20% for Scope 3 by 2025, from our 2016 base year.	Scope 3 emissions were 40% less than in 2016, and total Scope 1, 2, and 3
	footprint		emissions were 41% less than in 2016.
	Environmentally	Through our Priceless Planet Coalition, fund the restoration of 100 million	Working with our partners, through 2023, we have funded the restoration of
	focused solutions	trees by 20302.	17 million trees, of which 12 million are now planted.

• The gender pay median increase shown above uses a 2022 baseline median pay of 94.7% for women compared to men. The resulting 2023 median pay of 96.4% (+1.7 ppt) for women compared to men uses data as of September 30, 2023 and neutralizes for currency fluctuations over the measurement period by using 2022 foreign exchange (FX) rates.

• Refer to page 26 for information on our revised Priceless Planet Coalition goal.

• MASTERCARD 2023 ESG REPORT

INTRODUCTION	ENVIRONMENT	OUR PEOPLE	SUPPLIERS	CUSTOMERS	COMMUNITIES	GOVERNANCE	DATA TABLES	APPENDIX

Our ESG

BOARD OF DIRECTORS

The Board oversees our ESG strategy as well as discrete sustainability matters like cybersecurity and talent management.

Board diversity in 20231

governance

Sustainability at Mastercard is driven from the top by our Board of Directors and CEO and is embedded at every level of our organization.

Embedding ESG in executive and employee compensation

Nominating and

Corporate Governance

Committee

Oversees significant ESG activities, policies and programs including:

• Corporate responsibility
• Environmental stewardship
• Human rights
• Public policy activities

Audit

Committee

Oversees financial and operational risk exposures, and compliance with legal and regulatory requirements and disclosures, including:

• Tax practices
• Compliance with Code of Conduct

Risk

Committee

In coordination with Audit Committee, oversees risk assessment and risk management, including:

• Enterprise risk management
• Privacy, data responsibility and information security

Human Resources

and Compensation

Committee

Reviews people and culture strategy, including:

• DEI initiatives
• Compensation and benefits frameworks
• Human resources policies and practices, including those related to organizational effectiveness and employee development programs

33%

of our directors identify as female

58%

of our directors identify as racially or ethnically diverse

67%

of our directors are non-U.S. citizens and/or have international experience

To help further align our actions with our ESG goals, and to help ensure that all Mastercard employees share in the responsibility to uphold these goals, we link our annual incentive programs for executives and employees to ESG performance measures, including quantitative objectives for financial inclusion, gender pay equity and greenhouse gas emissions reductions.

• Reflects diversity metrics as of December 31, 2023

q

MANAGEMENT

Under the Board's oversight, the Management Committee implements the company's strategic direction including on sustainability matters. The Management Committee consists of our executive leadership team and additional members of management. Members of our management team report regularly to the Board and its relevant committees on ESG matters. Our senior management works together to assess and manage our sustainability efforts across the organization.

The ESG Executive Steering Committee, made up of leaders from each of our business units and managed by the Chief Sustainability Officer, meets approximately quarterly to review performance, provide strategic direction and support company-wide alignment on key ESG matters.

The Chief Sustainability Officer is tasked with developing sustainability goals in coordination with the business units and working with them to leverage sustainability as an enterprise-wide driver of growth. The Chief Sustainability Officer reports to the President of the Mastercard Center for Inclusive Growth & Executive Vice President of Sustainability, who is on the Management Committee. The President of the Mastercard Center for Inclusive Growth & Executive Vice President of Sustainability reports to the President of Strategic Growth, who is on the Management Committee and reports directly to the CEO.

Management

Committee diversity in 20231

27%

identified as female

27%

identified as racially or ethnically diverse

30%

were located in non-U.S. offices

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Application of our enterprise risk management framework for ESG

Effective risk management and oversight are essential to the success of our business strategy and continue to be an important element of our ESG strategy. Mastercard's Enterprise Risk Management (ERM) program seeks to ensure risks to the business are identified, escalated

and managed.

To foster organizational resilience and commercial success, we take a disciplined and consistent approach to risk management responding to new, existing and emerging risks, such as changing market trends, external events and the global regulatory environment. ERM works with the business to help ensure adequate identification, escalation and management of the most material potential risks to the company that may have a significant impact on our ability to execute our strategy and meet our objectives, and may adversely impact our brand and reputation.

As our business and the broader ESG landscape continues to evolve, so does our risk profile. The company maintains a risk taxonomy that describes the comprehensive set of risks to which Mastercard is exposed, including ESG-related risks. These risks are considered within our ongoing ERM risk identification, assessment and mitigation process and risk appetite framework, which feed into periodic updates to senior management, the Board and its committees on our consolidated risk profile.

Our ERM program allows management to consider the full range of risks and opportunities it faces, better informing decision-making as we pursue our ESG and overall strategy.

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Stakeholder engagement

At Mastercard, we regularly engage with our stakeholders on a wide range of topics. Everyday, across the globe, we interact with a variety of stakeholders in both structured and ad hoc ways. This engagement is an essential part of how we shape our ESG strategy and deliver on being a responsible business. Through open and ongoing dialogue with our stakeholders, we gain insight into their interests and perspectives, which helps inform our ESG strategy and efforts to drive positive, lasting impact. Throughout the year, we proactively engage with a wide range of stakeholders, including:

STAKEHOLDER GROUP

Our people

Employees of Mastercard

Why we engage:

Our people are our greatest asset and integral to our business success. We support employee engagement year-round to promote an inclusive, purposeful and productive workplace experience.

How we engage:

• Share company updates and discuss strategic priorities via quarterly Town Halls and through business unit/regional communication channels
• Obtain direct feedback from employees on their workplace experience via surveys used to inform our people strategy
• Conduct annual performance appraisals and career development discussions

Suppliers

Our network of suppliers

Why we engage:

Our business success depends on a reliable, resilient, transparent and inclusive supply chain that supports our objectives, drives development and innovation, and minimizes negative environmental impact.

How we engage:

• Collaborate with suppliers and provide supplier-specific education materials to support Mastercard priorities, including reducing greenhouse gas emissions and conducting business with integrity
• Communicate through two-way channels to support the proposal process and contract renewals

Customers

Financial institutions, merchants, governments, digital players and consumers

Why we engage:

Our customers are vital to our business success. They provide consumers access to Mastercard solutions and play a key role in upholding the rules and standards that help preserve the integrity of the payment system and promote reliable, simple and safe commerce.

How we engage:

• Build trust via a standard set of franchise rules
• Work proactively and collaboratively with our customers to grow business while minimizing risk
• Promote the Mastercard brand and offer consumers priceless experiences

Civil society and governments

Global communities, NGOs and nonprofit organizations, foundations, governments and regulatory bodies

Why we engage:

Our business does well when the communities we serve do well. Working with institutions that drive equitable and sustainable economic growth and the rule of law helps ensure that we are active participants in being a force for good.

How we engage:

• Monitor government and regulatory activity to ensure compliance with laws and regulatory obligations, and submit required disclosures and filings
• Partner with nonprofits, governments, NGOs and community organizations to advance social and environmental impact
• Activate and empower our Mastercard employees to share their skills via volunteerism
• Advance and inform public policy

Investors and other stakeholders

Stockholders and lending institutions

Why we engage:

Engaging with the investor community is an important way in which we advance awareness of our business strategy

and performance as well as garner feedback from this stakeholder group.

How we engage:

• Share business priorities and performance via annual reports, quarterly results briefings, Mastercard website, etc.
• Engage in continuous two-way dialogue including through quarterly investor meetings and conferences, Annual Shareholder Meeting, and various roadshows and investor days