Duckhorn Portfolio : Responsibility and Sustainability Report

	RESPONSIBILITY
	AND
	SUSTAINABILITY
	REPORT
Postmark Vineyard	2022
Paso Robles, CA

Photo by: Bob McClenahan Photography

Mt. Harlan AVA Hollister, CA

C ON T E N TS
Building a Foundation ....................................................	2
Welcome to Duckhorn ...................................................	3
ESG Framework and Oversight ..................................	8
ENVIRONMENTAL ..................................................	11
Climate Risk Management and
TCFD Reporting...........................................................	12
Energy Management.................................................	18
Carbon Reduction Initiatives.................................	20
Water Stewardship.....................................................	22
Responsible Packaging and Waste......................	25
Biodiversity and Land Stewardship.....................	27
Grower Partners.........................................................	29
SOCIAL ..................................................................	30
Human Capital Management..................................	31
Professional Development.....................................	34
Diversity, Equity and Inclusion..............................	36
Human Rights and Labor Practices....................	38
Health and Safety .....................................................	39
Promoting Responsible Enjoyment ...................	42
Contributing to Our Communities......................	44
Quality Management................................................	46
GOVERNANCE ......................................................	47
Board of Directors.....................................................	48
Our Management Team...........................................	49
Enterprise Risk Management
and Strategic Execution............................................	51
Committee Oversight and Structure .................	52
Data Security and Customer Privacy ................	54
APPENDIX
Performance Data Tables........................................	56
Climate-Related Risks and Opportunities........	60
Notes for Our Readers..............................................	61

Photo by: Bob McClenahan Photography

BUILDING A FOUNDATION

ALEX RYAN

President,

Chief Executive Officer

and Chairman

Last year, in our inaugural Responsibility and Sustainability Report, I stressed the importance of quantifying our company's environmental and social impact as an integral first step towards creating performance benchmarks and making positive, evergreen changes for our business and surrounding communities. Being at the forefront of climate risk management and corporate responsibility is an ongoing journey. The baselines we establish serve as a compass, guiding us as we strive to be good stewards of the land, champions of our employees and positive agents of change for our industry.

By our initial measures, the past year has been extremely positive and productive. From the baseline quantification of our Scope One and Two greenhouse gas emissions and energy usage to gender diversity, employee retention and employee safety, we now have a much more detailed understanding of our strengths and opportunities for growth. This information is pivotal as we set short- and long-term targets for improvement.

Photo by: Wildly Simple Productions

Towards a Better Environment

As part of our goal of reducing emissions, we continue to transition our forklift fleet to electric vehicles, contributing to our carbon credit eligibility from e-Mission Control's Green Fleet Pioneer Program. For the first time, we piloted a third-party verified Carbon Offset Program for the international transport emissions associated with Kosta Browne's Burgundy Series wines. Given our focus on land stewardship, our carbon offset program will support the restoration of the old-growth Klamath National Forest. To further decrease our environmental footprint and bring greater stability to our supply chain, we contracted with a new glass supplier based in Mexico, which helps us close in on our goal of sourcing 100% North American glass and decreases emissions from shipping. We also have internal targets to "lightweight" or reduce the weight of some bottles and continue to make environmentally conscious packaging choices. Midway through fiscal year 2022, we began formal water monitoring at all production facilities to capture baseline consumption metrics. While this process is ongoing, we have already started the work to reduce water usage-one of our most precious resources.

A Culture of Equality and Excellence

Our acclaimed team of more than 430 full-time employees continues to be the engine of our success. While our company culture already puts us at the forefront of human capital management, celebrating and supporting our diverse workforce and championing equality and employee wellbeing pays dividends. Beyond offering highly competitive employee benefits, we actively work to enhance employee wellbeing on numerous fronts. These include internal and external training, professional development, talent attraction, tuition reimbursement and a health and safety program.

These investments have yielded numerous successes; the retention rate at our ISO 9001 certified Waterfowl Winery-our largest facility-was 99% last year. We hosted more than 150 safety tailgates across all properties, saw increased participation in our tuition reimbursement program and in fiscal year 2022, 56% of our leadership positions were held by women, reflecting our company's overall gender parity.

A Foundation for Good Governance

Today, our ESG practices are woven into every layer of our business, from our Board of Directors ("Board") through every employee. With the continued advancement of our data collection and reporting processes, we are dedicated to transparency in providing concrete, accurate and verifiable information to our investors, consumers and employees.

Dynamic change creates its own powerful momentum. At The Duckhorn Portfolio, we have built a foundation that allows us to continue to make significant gains in every area of operations, from climate risk management to the good governance practices that are integral to a successful business. This collective effort empowers all of our employees to make sustainable choices on both environmental- and social-related fronts. In turn, this commitment to change, innovation and excellence will unlock the power within our people as we pursue our mission of creating a healthier planet and a more fair, equitable and inclusive wine industry.

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WELCOME TO

DUCKHORN

The Duckhorn Portfolio is the premier scaled producer of luxury wines in North America. We have delighted millions of consumers with authentic, high-quality, approachable wines for over four decades. Founded by our namesakes Dan and Margaret Duckhorn in 1976, we began by pioneering Merlot wines in Napa Valley and now produce a curated and comprehensive portfolio of highly acclaimed luxury wines across multiple winery brands, varietals, appellations and price points.

MISSION

To have our wines poured and enjoyed wherever fine wines are served throughout North America and the world.

Photo by: Nat & Cody Photography

Welcome		Environmental		Social		Governance	The Duckhorn Portfolio Responsibility and Sustainability Report	3

It is with a heavy heart that we remember our late co-founder, Margaret Duckhorn, who recently passed away. Margaret carried an active role in the company, from day-to-day operations to later specializing in marketing and public relations. A pioneering woman in the Napa Valley wine industry and gracious leader at Duckhorn, she was deeply loved and universally respected, and we will miss her dearly.

"We recognize the importance of taking care of this remarkable place, and giving back to the community that has given us so much. In addition, we make certain that our practices at the winery and in our vineyards are sustainable."

Margaret Duckhorn

Co-Founder

OUR VALUES AND COMMITMENT TO SUSTAINABILITY

Duckhorn values supporting our people, protecting our planet and operating our business to be best positioned for longevity. From the beginning, our founders instilled a sense of ownership and pride in the company.

Over the past year, we have committed to unearthing what makes Duckhorn so special and where we have room to grow, and have focused on highlighting those areas that contribute to the enhancement of our company and community. In fiscal year 2022, we concentrated on the collection and analysis of data, so that we can understand our baseline and determine the most fruitful areas of emphasis. To that end, we are proud to include data this year with respect to Scope One and Two emissions, water management, health and safety and supply chain management, among other areas.

OUR BRAND

Underpinning our success is a relentless focus on quality that has been ingrained in our culture since the inaugural harvest of our iconic Three Palms Vineyard in 1978. The Duckhorn Portfolio has consistently received exceptional reviews across varietals, geographies and price points from the industry's top critics and publications. Two of our wines, Kosta Browne Sonoma Coast Pinot Noir and Duckhorn Vineyards Napa Valley Merlot Three Palms Vineyard, have received one of the industry's most prestigious awards, Wine Spectator magazine's Wine of the Year.

2022 Recognition

In April of this year, we were honored to be presented with two awards from the Social Impact Awardsorganization, which highlights companies making strides in corporate social responsibility and diversity, equity and inclusion initiatives.

• Winner: 2022 ESG Program
• Honorable Mention: 2022 Community Affairs

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