In this report

Our performance

STRATEGIC REPORT

What we do 2

Why invest in us? 3

Our purpose and strategy 4

Delivering cash 6

Delivering resilience 8

Delivering growth 10

Chairman's statement 12

Group Chief Executive Officer's report 14

Market trends 18

Our business model 20

Our strategic priorities and KPIs 26

Business review 46

Stakeholder engagement 58

Task Force on Climate-related Financial Disclosures 67

SECR statement 77

Risk management 79

Viability statement 90

CORPORATE GOVERNANCE

Chairman's introduction 92

The Board as a guardian of our purpose and values 94

Our leadership 95

Board activities for 2020 96

Board composition, experience and biographies 98

Executive management team 101

The Board's COVID-19 response 102

The Board Sustainability Committee 103

Board engagement with colleagues 104

ReAssure case study - our M&A strategy in action 106

Our stakeholders and the Board's application of section 172 108

Division of responsibilities 112

Independence of Directors 112

Meeting attendance 112

Board education 113

Board Risk Committee report 114

Board Audit Committee report 116

Nomination Committee report 122

Directors' remuneration report 124

Directors' report 159

Statement of Directors' responsibilities 163

FINANCIALS

Independent auditor's report 164

IFRS consolidated financial statements 177

Notes to the consolidated financial statements 184

Parent company financial statements 290

Notes to the parent company financial statements 293

Additional Life Company asset disclosures 303

Additional capital disclosures 307

Alternative performance measures 309

ADDITIONAL INFORMATION

Shareholder information 311

Glossary 313

Forward-looking statements 318

The Strategic Report was approved by the Board of Directors on 7 March 2021 and signed on its behalf by

Andy Briggs

Group Chief Executive Officer

Visit our website atthephoenixgroup.com

KEY PERFORMANCE INDICATORS

£1,713m

(2019: £707m)

Operating companies' cash generation

APM REM

£5.3bn

(2019 pro forma: £4.4bn) Group Solvency II surplus (estimated)

164%

(2019 pro forma: 152%) Group shareholder capital coverage ratio (estimated)

APM REM

£766m

(2019: £483m) Incremental new business long-term cash generation

APM REM

47.5p

2020 total ordinary dividend per share

£1,199m

(2019: £810m)

Operating profit

APM

94%

(2019: 94%) Customer satisfaction score - telephony REM Phoenix Life only

90%

(2019: N/A) Customer satisfaction score - telephony

REM Standard Life only

OTHER PERFORMANCE INDICATORS

£834m

(2019: £116m)

IFRS profit after tax

£13.4bn

2020 pro forma*

(2019 pro forma: £14.1bn) Group long-term free cash

APM

£362m

(2019: £199m)

New business contribution

APM REM

£338bn

(2019: £248bn)

Assets under administration

APM

28%

(2019: 22%)

Fitch financial leverage ratio

APM REM

All amounts throughout the report marked with REM are KPIs linked to Executive remuneration. See Directors' remuneration report on page 124.

All amounts throughout the report marked with APM are alternative performance measures. Read more on page 309.

* 2020 pro forma Group long-term free cash includes £(0.2)bn adverse impact of disposal of Wrap SIPP, Onshore Bond and TIP products to Standard Life Aberdeen and £(0.3)bn adverse impact in relation to the expected increase in the rate of corporation tax from April 2023 to 25% announced in the March 2021 budget.

Read more about our strategic priorities and KPIspage 26 to 45

HELPING PEOPLE SECURE A LIFE OF POSSIBILITIES

STRATEGIC REPORT

Today, there is no longer a typical life and people's pensions needs are therefore evolving.

Phoenix has a pivotal role to play as the country navigates the shifting pensions landscape.

That's why our purpose is helping people secure a life of possibilities. This means providing the right guidance and products, at the right time, to support the right choices.

Our vision is to grow a strong and sustainable business to help more people on their journey to and through retirement.

We will focus on delivering against our strategic priorities and managing the business to deliver cash, resilience and growth.

Phoenix Group Holdings plc Annual Report & Accounts 2020

1

What we do

PHOENIX AT A GLANCE

Phoenix is the UK's largest long-term savings and retirement business with £338 billion of assets under administration and c.14 million customers. We are a constituent of the FTSE 100 with c.7,500 colleagues and offer a broad range of products to support people across all stages of the savings life cycle. We are a growing and sustainable business with a clear purpose - helping people secure a life of possibilities.

Our businessMain brands

HERITAGE

Our Heritage business, where we are the market-leader, is focused on the safe and efficient management of insurance policies. It comprises products that are no longer actively marketed to new customers and where we have stepped in as the custodian of these policies. We have built this business through the consolidation of over 100 legacy insurance brands and have a proven track record of improving customer outcomes.

OPEN

Our Open business operates products that are actively marketed to new and existing customers.

The Open business comprises five separate business units including our Workplace pensions and Customer Savings & Investments ('CS&I') units both of which operate under the Standard Life brand, the Retirement Solutions unit that includes both vesting annuities and our Bulk Purchase Annuity ('BPA') business, as well as our over-50s brand 'SunLife' and our European business operating in Ireland and Germany.

Read more about our operating structurepage 22

2

Phoenix Group Holdings plc Annual Report & Accounts 2020

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Phoenix Group Holdings plc published this content on 29 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 March 2021 17:36:06 UTC.