North West : 2023 Sustainability Report

Thriving together

Sustainability Report

2023

1 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

Table of contents

About this report	2
A Message from our CEO	3
About The North West Company	4
Our Value Chain	5
Our approach to ESG	6
Our ESG Strategy	7
Our Promise to Indigenous People	9
ESG Governance	10
Engaging our partners	11
Highlights of this Report	12
People	13
Community Impact & Engagement	14
Customer Health & Nutrition	15
Diversity, Equity and Inclusion (DEI)	17
Human Capital Development	19
Health, Safety & Wellness	20
Planet	21
Climate Action	22
Food Waste	24
Waste Management	25
Partnerships	26
Responsible Business & Supply Chains	27
Data Privacy	28
Cyber Security	29
Looking forward	30
Forward-Looking Statements	31

Gilbraltar House, Winnipeg, Manitoba

Cover photo: Wade Maring, Inuvik, NT

2 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

About this report

WE ARE PLEASED to share the latest progress on The North West Company Inc. ("North West" or "the Company") Sustainability Report 2023 with our partners. Through this report, we provide accountability and transparency related to our strategies and actions to address core material Environment, Social and Governance (ESG) topics. The information included in this report is based on topics that are deemed material to the sustainability performance of North West and future plans on developing our progress on ESG and sustainability topics.

This report covers our fiscal year 2023, from February 1, 2023, to January 31, 2024. The information in this report relates to our corporate operations, which include our retail stores, distribution centres, subsidiaries and offices. Unless otherwise noted, all financial amounts in this report are presented in Canadian dollars.

3 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

1. Message from our
   CEO

WE BELIEVE NORTH WEST has a responsibility to make a positive impact in the communities we serve. This is central to our company's purpose. As we reflect on the last year, our teams demonstrated commitment to enhance our capabilities and ESG performance across our entire business. Through "Our Promise to Indigenous Peoples", we advanced our work towards Reconciliation and enhanced collaborative relationships with Indigenous Peoples in Canada. We are proud of the partnerships we have forged with Indigenous Peoples including partners, vendors and service providers, with whom we contributed $54 million in 2023. In addition, we supported community events and causes ranging from traditional and cultural celebrations to sports teams with over $2.9 million in monetary donations and employee volunteer time. Taking the momentum of this work, and the results obtained from our ESG materiality assessment, we developed our first Enterprise ESG Strategy

that will guide North West to achieve our aspiration to co-create an equitable and sustainable future with our partners.

At North West, we work hard to deliver on that ambition while creating business value and bringing essential products and services to underserved communities in northern Canada, Alaska, the Caribbean and the South Pacific. We have a unique opportunity to improve our business operations, while listening to the communities we serve and fostering collaboration opportunities with our partners. There is no doubt in my mind that engaging in meaningful dialogue and offering transparency are essential to achieving transformative change and building stronger partnerships.

I would like to extend my gratitude to our valued employees, customers and the communities we serve for their support and partnership on our journey towards sustainability, and allowing us to thrive together.

"We believe that listening to the communities we serve, meaningful dialogue and transparency are essential to achieving transformative change and building stronger partnerships, securing trust and ensuring the loyalty of our customers."

Daniel G. McConnell

President and Chief Executive Officer

4 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

About The

North West

Company

THE NORTH WEST COMPANY is a leading retailer to rural and developing small population communities in the following regions: northern Canada, rural Alaska, the South Pacific and the Caribbean. Our stores offer a broad range of products and services with an emphasis

on food and a compelling value offer of being the best local shopping choice for everyday household and lifestyle needs. North West has a rich enterprising legacy as one of the longest continuing retail enterprises in the world. The Company traces its roots back to 1668 and many of our stores in northern Canada have been in operation for over 200 years.

STORES:

227

OUR PURPOSE:

To help make

1. positive difference within each community we serve.

COMMUNITIES:

187

OUR VISION:

To bring to

communities products and services that help people live better.

COLLEAGUES:

7,382

OUR MISSION:

To be a trusted community store.

5 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

Our Value

Chain

THE NORTH WEST COMPANY offers a broad range of products and services across geographically and culturally diverse markets. The organization's leadership continuously assesses the strength of its customer value offer to ensure that specific markets, products and services are financially attractive.

North West delivers its products and services through the following retail, wholesale and complementary businesses in Canadian and International operations:

• Canadian operations include Northern stores, NorthMart stores, Quickstop convenience stores, Giant Tiger ("GT") junior discount stores, Valu Lots, Solo Market store, Pharmacy and Convenience stores, NWC Motorsports dealership, Crescent Multi Foods ("CMF"), North West Telepharmacy Solutions, Transport Nanuk Inc. and North Star Air Ltd. ("NSA").
• International operations include Alaska Commercial Company ("AC"), Quickstop convenience stores within rural Alaska, Pacific Alaska Wholesale ("PAW"), Cost.U.Less ("CUL") in the South Pacific and Caribbean and RiteWay Food Markets ("RTW") in the British Virgin Islands."

Sourcing

We procure products and finished goods from manufacturers and distributors in our global supply chain (including Indigenous and local products). North West also manages indirect sourcing for services, technology and supplies needed to run our business operations. North West owns warehouses to centralize goods, manage inventory and logistics.

North West adapts its product sourcing to the varied community preferences and priorities of local communities.

Distribution

North West relies on a complex and elongated outbound supply chain due to the remoteness of its stores (northern Canada, rural Alaska, the South Pacific and the Caribbean). The delivery of merchandise to a substantial portion

of the Company's stores involves multiple carriers and multiple modes of transportation including trucks, trains, aircraft, ships and barges through various ports and transportation hubs.

Retail

Based on customer needs and preferences, North West sells a broad range of products and services across geographically remote and culturally diverse markets.

North West also offers quality health and telepharmacy solutions in northern communities.

Consumer

North West attends underserviced, rural and remote developing small population communities, providing customers with products and services such as food, family apparel, housewares, appliances, outdoor products and services such as fuel, post offices, pharmacies, income tax return preparation, quick-service prepared food, prepaid card products, ATMs, cheque cashing and proprietary credit programs.

6 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

Our approach to ESG

ESG MATTERS CAN significantly affect our business operations, reputation and financial outcomes. Addressing ESG in our operations, policies and strategy is foundational to ensure business success and long-term value creation. ESG goes beyond minimizing risks; it is an opportunity to innovate and create value for our business and the communities where we operate.

Materiality & Engagement

We recognize the importance of engaging with partners on the path to improving our business operations. Listening to and learning from groups that are impacted by our activities is an essential component of our continuous improvement process and defining ESG material topics1. In the first quarter of 2023, we conducted an assessment to determine which ESG topics have the greatest impact on our business and which of those are most important to our partners. The survey included material topics from the SASB Standard "Food Retailers

• Distributors", as well as topics that are relevant for other retail companies. To perform

this materiality assessment, we launched an ESG survey with internal and external partners, including local community members, employees and non-government organizations (NGOs),measuring the level of importance and perception for each sustainability topic. The material topics represent the main

ESG topics in our ESG Strategy Framework, highlighting risks and opportunities that can reasonably be expected to influence North West's performance.

Kathy Laliberte, Ile a la Crosse, Saskatchewan

Contributing to the United Nations Sustainable Development Goals (UN SDGs): North West recognizes the importance of the United Nations (UN) 2030 Agenda for Sustainable Development, and the UN's ambition to provide a shared blueprint for peace and prosperity for people and the planet, now and into the future. Our purpose and our efforts look forward to contribute to 10ofthe 17 SDGs.

1 Material topics are environmental, social or governance topics on which North West has an impact, or may be impacted by.

7 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

Our ESG

Strategy

OUR ESG STRATEGY aims to achieving positive change through a shared-value framework that benefits people, our planet and supporting on creating strong partnerships for the future.

Community and employee experience are at the heart of the ESG strategy, representing an opportunity to secure and enhance trust and loyalty of our partners, while also delivering business value. Through our ESG Strategy we

seek to improve the community experience by advancing positive changes in the communities we serve, supporting their journey for improved health, nutrition and overall quality of life. Also, employee experience supports to enhance a more diverse, equitable and inclusive working environment, where employees can further develop their skills and grow their careers to succeed in the organization.

Our ESG Strategy is embedded across our business operations and influences our unique business model to support underserved communities in remote geographical locations. Recognizing that we have a responsibility

to promote health and nutrition in the communities we serve, supporting social equality and inclusion, and protecting the natural environment, we have identified and

selected material ESG topics for our ESG Strategy Framework. Our ESG Strategy defines a clear pathway to drive our efforts towards a more sustainable and equitable future, accelerating progress to benefit people, the planet and our business partnerships.

North West's

ESG Strategy

Framework

						P
	E					L
					N
	L
	P					A
O	Community	E
	T
E		Experience
P
		Employee
		Experience
	P
	A				P
	R
		T		I	S
			H
			NERS

PEOPLE	PLANET	PARTNERSHIPS
To help employees and local	To protect the environment and	To maintain trust with
communities to advance towards	address climate change	our partners
a healthier, inclusive and	• Climate Action	• Responsible Business & Supply
equitable future	• Food Waste	Chains
• Community Impact	• Waste Management	• Data Privacy & Security
• Customer Health & Nutrition
• DEI & Human Capital
Development
• Health & Safety

8 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

The ESG strategy represents the start of our journey towards a more just, equitable and sustainable future. For North West, ESG is about increasing our positive impact for people and our planet while creating business value. As we start developing and implementing our action plans, we recognize that this is a continual learning process and that there are challenges we will need to overcome across our business operations.

North West ESG vision and ambitions

PEOPLE

Help employees and community members advance towards a healthier, inclusive and equitable future, creating meaningful relationships and positive impacts in the communities we serve. We seek to promote food security, contribute

to health and nutrition and accelerate diversity, equality and inclusion.

PLANET

Protect the environment and address climate change by striving to reduce Green House Gas ("GHG") emissions and waste across our business operations.

PARTNERSHIPS

Maintain trust with our business partners by ensuring ethical and safe business practices in our supply chains and operations, including protecting personal and company information.

Our ESG Vision

To co-create an equitable and sustainable future with our partners

Shannon Wood - Gods River, Manitoba

9 | 2023 Sustainability Report

Introduction

People

Planet

Partnerships

Looking Forward

Our Promise to Indigenous People

Our Promise to Indigenous Peoples is a cornerstone of our ESG Strategy. At North West, we acknowledge the company's longstanding relationship with Indigenous Peoples, our shared history and our responsibility in advancing Reconciliation.

Our Promise to Indigenous Peoples is a reaffirmed commitment to building more collaborative relationships that will enhance the inclusion and social well-being of Indigenous People of Canada. We fully commit to the spirit of reconciliation reflected in the Truth and Reconciliation Commission's Calls to Action and final report.

The Pillars of "The Promise" are the following:

• Well-being& Security: North West commits to working collaboratively with Indigenous Peoples to advance health and well-being in the communities we serve
• Stronger Community Bonds: North West commits to developing stronger community bonds by recognizing the past and committing to a better future
• Inclusion & Economic Success: North West commits to improving Indigenous inclusion in store and head office management while encouraging Indigenous economic development

At North West, we continuously work towards the accomplishment of these goals and embed "The Promise" in everything that we do.