sustainability Report 2017

Pacific Aria

Table of Contents 1 sustainability Report For P&O CRUISES 2017 Fiscal Year

Table of Contents

3 Message from the President 4 Introduction 5 Regulatory Landscape 7 Employees 11 Safety, Security and Health 14 Environment 19 Community 21 Performance Summary 26 Report Parameters 27 Glossary 30 GRI Table

Table of Contents 2 Message from the President

After more than 85 years of cruising from Australia, P&O Safe practices to protect the environment are a given, Cruises Australia has expanded its horizons while setting but we also see economic opportunity from cruising as the foundation for cruise tourism in our region and its central to the sustainability proposition. In Australia, it is remarkable growth over more than a decade. P&O Cruises about P&O Cruises making a significant contribution to is quintessentially and proudly Australian in reflecting the national economy each year and opening up regional the values of a people renowned for their easygoing and destinations to this positive economic activity. engaging manner. This combines with a deep love of the environment, not only of the areas in which they live but The approach is just as diverse in the South Pacific. For also of the places they visit while cruising and the oceans New Caledonia, as an example, it has involved supporting on which they sail. the Lifou community’s efforts to safeguard the fragile environment of Jinek Bay, even when it meant limiting our Like us, they understand that our ships take them to idyllic guests’ access to its wonderful biodiversity. destinations, particularly in the South Pacific, where the environment is pristine and where guests have contact with In the developing island nation of Vanuatu, we see an people whose cultures, traditions and way of life are truly added dimension to environmental protection and fostering special and should be safeguarded. And again like us, our economic opportunity locally. Here we work in partnership guests wish to leave the smallest possible environmental with Save the Children on community-sustaining programs footprint in communities that continue to welcome us to through the P&O Pacific Partnership. It enables our guests their homes. to each make a small but overall valuable contribution to people they have grown to love over our years of cruising. For P&O Cruises, engaging in sustainable tourism to protect Programs of this kind are now also finding their way to the land and sea is integral to what we do as a business. Papua New Guinea and the Solomon Islands. It involves more than simply ticking the boxes. We take our responsibilities very seriously. Our commitment to We also step forward when island communities are in achieving constant improvement can be seen in the context distress following natural disasters in these remote but of P&O Cruises being the people’s choice in being named beautiful parts of the world. It is part of a bond that has Australia’s most trusted cruise brand over multiple years. been growing since that first P&O cruise from Australia in We also know that such a level of trust must be earned on a December 1932. daily basis in everything we do. Thank you for taking the time to read and understand how Our approach is linked fundamentally to the destinations P&O Cruises’ approach to sustainability brings together and communities with which we come in contact. Whether many strands, with each placing people and communities at it is destinations in the South Pacific, New Zealand, the forefront of all that we do in this regard. Southeast Asia or Australia itself, we want the welcome sign to always be there for our ships and guests. This is why Sture Myrmell our approach to sustainability is multifaceted. President, Carnival Australia and P&O Cruises

Table of Contents 3 Introduction

History: Five years ago, we began making extensive systemic We’re happy to announce our newest and largest ship, improvements to our company’s performance tracking. Pacific Adventure™ will join the family in October 2020. P&O Cruises Australia cruising story began more than 85 In collaboration with our parent company, Carnival years ago, when the P&O Cruises Australia’s mail steamer Corporation & plc, we established a working framework On January 1, 2016, Sture Myrmell was appointed Strathaird sailed from Sydney, Australia. The six-day to target areas where improvement was needed and to President of P&O Cruises, reflecting the brand’s massive cruise to Brisbane and Norfolk Island — where guests measure our progress. growth in 2015 and its position as Australia’s homegrown traveled ashore in the ship’s lifeboats — had created so cruise line. CEO Ann Sherry, who had been leading the day­ much excitement that it was fully booked in just 24 hours, We released this data as the beginning of an ongoing to-day activities of P&O Cruises for the previous eight years inspiring P&O Cruises’ sister company, Orient Line, to conversation with our stakeholders via our first corporate as well as driving strategy for the region’s multiple cruise offer a cruise on the Oronsay departing the following day responsibility report in 2009. All of our sustainability brands, became Carnival Australia’s executive chairman. from Sydney for Nouméa in New Caledonia. These sailings reports detail our efforts to strengthen management In 2017, Sture Myrmell became President of Carnival marked the birth of the Australian cruise industry and the systems and performance aligning with a multi-year Australia. start of P&O Cruises’ close bond with the Pacific Islands. corporate restructuring designed to increase operational efficiency. Learn more about the history of our fleet. Fast forward to November 25, 2015, when all five ships in the P&O Cruises fleet, including newcomers Pacific Aria Organization structure: Opportunities: and Pacific Eden, sailed in formation into Sydney Harbor as we celebrated a record year in carrying almost half a P&O Cruises is the region’s largest and longest- As our company has grown, we have made operational million holidaymakers. The expansion of the fleet opened serving cruise operator and leads the way in cruising as adjustments to accommodate the shifting business up new opportunities and itineraries sailing from Sydney, Australasia’s only “home brand” and its favorite cruise line. climate. Regulatory changes and the fluctuating global Brisbane, Melbourne, Adelaide, Fremantle and Cairns We have been sailing in the region for more than 85 years economy and fuel prices continued to pose challenges in Australia, Auckland in New Zealand and Singapore in and have pioneered new itineraries around Australia, the during this reporting period. We’re proud to have addressed Southeast Asia. While the Pacific Islands remain, as ever, Pacific and Southeast Asia, along with Papua New Guinea, these challenges while continuing to drive improvement. popular cruise destinations, P&O Cruises has also led a as reported in The New York Times’ 52 top destinations for Specifically, we maintained our already excellent track big increase in Australian domestic cruises, opening up a 2015. record for safety and continued improvement in critical number of regional destinations around the country to the indicators such as fuel efficiency, greenhouse gas emissions benefit of cruise tourism. Learn more about us. and waste recycling. In addition, we found new ways to expand the impact of our employee development, Learn more about the history of P&O Cruises Organizational changes: community giving and volunteerism efforts.

Commitment to sustainability: In May 2014 Carnival Corporation announced that We are focused on achieving our 2020 corporate Statendam and Ryndam would be transferred from Holland sustainability goals as well as selecting and developing the We have established true partnerships with local America Line to the P&O Cruises fleet in 2015 next set of targets. communities in the Pacific Islands in line with P&O Cruises pledge to share the economic benefits of cruising in this after being refurbished to tailor them for Australian and Building upon the insights from our previous sustainability special part of the world. We have worked together in a New Zealand guests. The new names for the two ships, report, this report will continue to help us measure against variety of ways, protecting pristine environments through Pacific Eden and Pacific Aria, were revealed on July 11, existing goals and position us for continued success. We the development of destination management plans and 2014, with the ships joining the fleet in November 2015. appreciate your interest in our efforts. If you have any encouraging employment and business opportunities questions or ideas you’d like to share with us, please associated with cruising. In particular, we have helped to In October 2015, Carnival Corporation announced that the contact us at [email protected]. develop shore tour ventures and sustainable marketing of Dawn Princess would transition from Princess Cruises to locally made handicrafts. P&O fleet in 2017. The Dawn Princess was refurbished for the Australian and New Zealand market and renamed Pacific Explorer. She joined the P&O fleet in May 2017, following the departure of the Pacific Pearl in April 2017.

Table of Contents 4 regulatory landscape

We adhere to all international, national and state regulations applicable to our vessel operations. Our ships The ISM Code is an international standard for the safe are registered in the United Kingdom, giving the country the management and operation of ships and for pollution ultimate authority and responsibility to enforce laws and prevention. It requires all ship operating companies and regulations pertaining to our fleet operations. Additionally, ships to develop, implement and obtain certification of their Safety Management System (“SMS”). The SMS covers both governments in all of the port locations we visit have the shipboard and shore-based activities and must include authority to inspect our ships, including the Australian • a company safety and environmental protection policy; Maritime Safety Authority when our ships call on Australian • instructions and procedures to ensure the safe ports. Our safety, security, health and environmental operation of ships and protection of the environment; practices are based in international convention as • procedures for preparing for and responding to established through the International Maritime Organization emergencies; (IMO) and the International Labour Organization (ILO). • defined levels of authority and lines of communication between shore and shipboard personnel, and IMO’s Convention for identification of a designated person ashore the Safety of Life at responsible for ISM Code compliance; SOLAS contains safety • procedures for reporting accidents and ISM Code non­ Sea (SOLAS) specifies requirements for design, conformities; and minimum standards construction, equipment, • procedures for internal and external audits and for the construction, operations, safety management reviews. equipment and operation management, and security. of ships. Under SOLAS, It includes 12 Chapters, the International Safety seven of which apply to Management (ISM) Code P&O Cruises. requires that all ships IMO also introduced the Convention for the Prevention of implement a safety Pollution from Ships, more commonly known as MARPOL, management system (SMS), and the International Ship and to protect the maritime environment from pollution that Port Facility Security (ISPS) Code prescribes measures to is either accidental or the result of routine operations. enhance the security of ships and port facilities. MARPOL has in total six Annexes, four of which are applicable to P&O Cruises. We also abide by regulations such as the Great Barrier Reef Marine Park Act 1975 prohibiting the discharge of all food waste. We follow The ISPS Code: rules about discharge of water waste in the Great Barrier • defines security standards, requirements, arrangements Reef Marine Park and in Victoria State Waters and do not and procedures for ships, ports, and governments; and discharge any waste in the New Zealand Fiords or Komodo • prescribes responsibilities for governments, shipping companies, shipboard personnel, and port/facility National Park. personnel, among others, to develop security plans, detect security threats and take preventative measures against potential security incidents affecting ships or port facilities.

Table of Contents 5 regulatory landscape - continued

Other core international conventions include IMO’s In collaboration with our parent company, Carnival Convention on Standards of Training, Certification, and STCW requirements include Corporation & plc, we continue to strive and focus on Watchkeeping for Seafarers (STCW), which establishes • standards for the training, qualification and certification reducing our footprint. In order to manage our greenhouse consistent minimum requirements across borders, and of seafarers; gas footprint, we must manage the source of the emissions. ILO’s Maritime Labour Convention 2006 (MLC 2006), which • specific standards of competency of crew members; and There are multiple aspects of climate change that influence • methods for demonstrating competency. All eight aims to protect seafarers’ rights and to secure economic our strategy, including regulatory changes, stakeholder chapters of STCW apply to interests through fair competition. Carnival Corporation & plc’s operations influence and economic efficiencies, specifically as it Entered into force in 2013, MLC 2006 was designed to Chapter I: General provisions relates to our dependence on fossil fuels. Shipboard fuel become the fourth pillar of the international regulatory Chapter II: Master and Deck Department consumption is the most significant contributor to our regime for quality shipping alongside SOLAS, STCW and Chapter III: Engine Department carbon footprint, as our shipboard operations far exceed our MARPOL. MLC 2006 establishes standards for seafarers’ Chapter IV: Radio-communication and radio personnel shoreside operations. rights to decent conditions of work and helps to create Chapter V: Special training requirements for personnel conditions of fair competition for ship owners. P&O Cruises on certain types of ships We are constantly working to reduce our air emissions and complied with all MLC 2006 requirements prior to the Chapter VI: Emergency, occupational safety, medical to improve air quality by evaluating new and established convention’s enforcement. care and survival functions technological solutions. Further information about the Chapter VII: Alternative certification maritime regulatory landscape can be found in the Carnival Chapter VIII: Watchkeeping As a long-standing member of the Cruise Lines Corporation & plc 2017 Annual Sustainability Report (page International Association (CLIA), Carnival Corporation & plc 145). 2016 Annual Sustainability Report (page 85) we adhere to a corresponding set of stringent standards that are designed to keep our guests and employees safe, secure and healthy while protecting the environment and providing an industry- MLC 2006, which was ratified in August 2012, entered leading workplace. into force August 2013, consolidates and updates the International Labor Organization standards into a single document. It • provides comprehensive rights and protection at work for seafarers on a global basis; • aims to be globally applicable, easily understandable, readily updatable and uniformly enforced; and • was designed to become the “fourth pillar” of the international regulatory regime for quality shipping (SOLAS, MARPOL and STCW). The MLC establishes standards regarding the working conditions of seafarers including • minimum requirements for seafarers to work on a ship; • conditions of employment; • accommodation, recreational facilities, food and catering; • health protection, medical care, welfare; and • social security protection.

Table of Contents 6 employees

At P&O Cruises Australia our team members are Of our more than 350 shoreside employees who work in our greatest assets. We recruit top talent, provide our offices in Sydney, Australia, a majority are in full-time comprehensive training, create opportunities for positions, while approximately 10 percent are in part-time development and advancement, and offer a competitive or seasonal positions. Many of our shoreside employees pay and benefits package. In keeping with our high ethical are responsible for selling cruises and tours, taking standards, we follow the complex employment laws and reservations and completing the financial and accounting regulations that apply to our global operations. transactions required for internal and external controls.

WORKFORCE SNAPSHOT DIVERSITY

We have a diverse workforce of approximately 3,000 As an employer that offers equal opportunity to its team skilled team members who are committed to working members, P&O Cruises hires both men and women for together toward our common mission. We have a long-term every department on board our ships and in our shoreside commitment to source at least 5 percent of our crew from offices. A majority of our shipboard employees are men, the Pacific Islands and actively recruit through agents, reflecting a gender imbalance in the applicant pool for by attending fairs and building partnerships with training officer and crew positions. colleges and universities. The gender distribution within our shoreside team has A majority of our team members work on board our ships, greater balance, with approximately 60 percent of the and approximately 12 percent are based in our shoreside business represented by females. Women hold 46 percent offices. of all managerial positions, and 46 percent of all vice president positions and roles above (executive) are held by Each of our shipboard team members works within one of women. three departments, all of which are ultimately under the supervision of the ship’s Master: As a truly global company, we embrace cultural diversity. We believe a variety of backgrounds and perspectives • Our Deck Department is comprised of officers and strengthen every area of our operations, from our crew who ensure the safe conduct of our ships, engagement in port communities to our interactions with provide security, respond to health needs and manage guests. exterior maintenance. • Our Engine Department sources officers and crew Approximately 82 percent of our shipboard employees are who are responsible for the engine room as well as from Asia, specifically Indonesia and the Philippines, where the technical and interior maintenance of our ships— we have long-term relationships with local employment from power, propulsion and environmental systems to agencies. While many of our shoreside team members are heating, ventilation and air conditioning. from Australia, which aligns with the location of our Sydney, • Our Hotel Department consists of team members New South Wales, office, we have representation from all who manage guest accommodations, restaurants and over the world. entertainment.

Table of Contents 7 employees - continued

RECRUITMENT & RETENTION Shoreside Recruitment: Among shipboard team members, our turnover rate remained steady over the past two years at an average of Our values determine how we behave at P&O Cruises. We have an established shoreside recruitment team and 23 percent, due in large part to structural changes within These values form the basis of our behavioral key very rarely need to rely on the assistance of a third-party our company and the addition of two ships. Our turnover performance indicator (KPI), an integral part of our overall recruitment agency when it comes to shoreside talent. We rate for shoreside employees has been steady over the past employee KPIs (performance plans) and our reward and source directly through digital platforms and a successful two years, averaging around 16 percent. recognition program, The Globe Awards. referral program. Employee Engagement We Stand Tall Retention: Being courageous and acting with integrity, holding yourself We believe good communication, recognition, our accountable and being a proud company representative. We strive to promote from within and offer opportunities for commitment to an ethical corporate culture, opportunities advancement in order to keep our best performers. Many to give back and reduced-rate continuing education all We Think Big of our employees have long tenure. The average length of significantly enhance our employees’ experience with the It’s constant innovation, thinking about big ideas and aiming service is approximately five years, and around 15 percent company and contribute to employee retention. We conduct higher to reach our goals. of our people have more than 10 years of service. We employee engagement surveys quarterly for the shoreside proudly celebrate key employment milestones on a regular team and every two years on board. The data we collect We Play to Win basis. helps to identify and prioritize where to direct funding and It’s about teamwork and partnerships and the relentless resources to improve the employee experience. drive for success. Performance Review Shipboard Recruitment: We all work better when we have a clear understanding of The recruitment of officers for our shipboard positions is what’s expected of us in our roles and how our performance particularly challenging due to intense competition for is measured against our set objectives. Through our annual skilled labor in the maritime industry. To recruit strong talent management cycle, team members and managers candidates, we often partner with global talent partners to work collectively to establish a number of Key Performance help us find the best talent. Indicators (KPIs), and throughout the year they have regular informal catch-ups to discuss progress. Twice a year all We hire a majority of our crew members through these employees will be engaged with a formal performance employment agencies that act on our behalf. Though many appraisal. We are measured against four key categories: nationalities are represented among our crew, our company financial, customer, people and behavior. has worked with the same primary employment agencies in Indonesia, India, Vanuatu and the Philippines for several All employees have the opportunity to create a personal decades. We require our employment agencies to be Development Plan with their manager to help identify certified in line with the Maritime Labour Convention (MLC) training needs and guide career progression. 2006. We also perform our own audits of these agencies on a regular basis, monitoring their job assignment processes, TRAINING & DEVELOPMENT recordkeeping, pre-employment screening and post- employment follow-up. We are committed to safety and sustainability, and this is reflected in our training and development programs. Detailed crew employment records are maintained in local Shaped in accordance with the International Maritime recruiting offices and at our Seattle headquarters. The Organization’s (IMO) Convention on Standards of Training, minimum age of employment within our fleet is 21, with the Certification and Watchkeeping for Seafarers (STCW), these exception of cadets in training, new officers coming from programs also address security, health and sanitation, the cadet program who must be 18 or over. ethics, company policies and procedures, regulatory requirements and job-specific skills.

Table of Contents 8 employees - continued

As graduates of merchant marine academies, our deck training that is specific to their job responsibilities and Our officers and crew members work under contract, and engine officers are knowledgeable about all aspects of exposure and are timely informed of changes to policies and typically seven days per week, between three and 10 maritime safety and crisis management. They participate procedures through our communication methods. months in duration with typically two to three months in our training programs alongside the rest of our team off between contracts. We have formal systems on members in order to stay current with our policies COMPENSATION, BENEFITS & WELLNESS board our ships to ensure we properly compensate crew and procedures, which are regularly updated based on We provide a competitive pay and benefits package that members for the hours they work and that they receive enhancements to our vessels and changes in regulatory focuses on performance and results, rewarding employees adequate time for rest and recreation. We also make every requirements. for meeting specific goals. effort to help them strike a positive work-life balance by providing comfortable living quarters, nutritious meals, Our training efforts leverage classroom sessions, For both our shipboard and shoreside team members, merit transportation, onboard recreation facilities, shore leave supervisory guidance, e-learning programming and pay increases are tied to performance discussions which and shore excursion opportunities. We also promote events toolbox discussions to ensure employees are informed and are conducted at the end of each contract or within an and activities designed to cultivate personal development, a prepared. This training is augmented by frequent drills that annual cycle, respectively. Wages for some of our shipboard sense of community, health, spirituality and other aspects enhance skills and assess readiness. officers and crew are negotiated through their unions, and of wellness. we pay competitive wages. Leveraging scenarios, games and visuals, systems provide LABOR RELATIONS & FAIR EMPLOYMENT standardized training courses in personal and professional A large suite of benefits is available to our shoreside team. development for every employee at every location and skill These include health and well-being programs, cruise In keeping with our commitment to integrity, honesty and level. discounts, medical insurance discounts and coverage, high ethical standards, we follow the complex employment salary continuance and flexible working practices. laws and regulations that apply to our global operations, Carnival Corporation, P&O Cruises’ parent company, owns including all of the provisions of the International Maritime and operates the Arison Maritime Center, home of the Beyond pay and these benefits, another important aspect of Conventions (IMO and ILO) and Flag Administration Center for Simulator Maritime Training Academy (CSMART our compensation package for shoreside employees is the regulations that are in effect for seafarers. We also Academy). Opened in July 2009 and located in Almere, opportunity for an annual incentive cash bonus and long­ recognize our employees’ rights to freedom of association Netherlands, outside Amsterdam, the CSMART Academy term incentives paid in company shares. and participation in collective bargaining. All individuals on is a world-class training center for safety and excellence a crew agreement have a collective bargaining agreement. in maritime operations. It features the most advanced We believe all employees should experience our cruise simulator equipment, technology, instructional tools and offerings from the guest’s perspective, so we encourage We maintain excellent working relationships with the curriculum, which provide participants with a superior onboard crew to apply for free or reduced-fare cruises of up unions that represent our team members. The employees’ maritime training experience that emphasizes team-based to 14 days anywhere we sail when space is available. Our trade union organizations Federazione Italiana Transporti- critical thinking, problem solving and decision-making. shipboard officers may bring family and friends on board as CISL (FIT-CISL) and Federazione Italiana Lavoratori The Center provides rigorous safety training for bridge our guests at no charge. These guests stay with officers in Transporti – CIGL (FILT-CGIL) represent the majority of our and engineering officers responsible for the navigation and their cabins and enjoy all of the officers’ privileges, such as crew. Nautilus International represents our British deck operation of the world’s largest fleet of cruise ships. For access to gyms and other amenities. and engine officers and crew. more information please visit www.csmartalmere.com All of our shoreside employees are eligible to participate Our long-standing policy is to afford equal opportunity for Our training program includes e-learning and instructor- in our education assistance program, which offers employment to all individuals regardless of race; creed; led courses on ethical conduct, as well as topics related opportunities to expand job-related knowledge and skills color; religion; national origin; gender; sexual orientation; to human rights, labor relations, customer privacy and by providing reimbursement for tuition, fees and associated gender identity and expression; age; marital status; veteran social issues such as fraud and corruption, among others. material. These employees are also eligible for paid study status; or mental, sensory or physical disability. On board We abide by the Cruise Lines International Association’s leave. Our officers on board are eligible to participate in our our ships we have complaints procedures posted in all crew (CLIA) anti-corruption principles. We have adopted and seagoing study leave program, which covers 100 percent of areas which explain to our crew how issues can be raised implemented policies and procedures to prevent bribery the cost of maritime courses. on these topics. and corruption. Our officers and team members receive

Table of Contents 9 employees - continued

ETHICS

We strive to provide a workplace that is fair to all. All We occasionally receive grievances about labor practices, of our employees are required to complete our Code of human rights, impacts on society (climate impacts), the Business Conduct and Ethics training, which serves as a environment, guest privacy and guest relations, among guide to ethical business conduct and covers a wide range others. We evaluate all grievances that we receive. Our of business practices and procedures including employee goal is to complete their evaluation within a reasonable responsibilities, anticorruption, conflicts of interest, etc. Our timeframe based on circumstances and legal complexity. employees also receive training on how to recognize and However, thorough investigation may require an extended report misconduct. All employees are encouraged to report period of time to close some complaints. any harassment or discrimination concerns immediately to their direct supervisor, the Human Resources Department Discrimination claims filed internally by shipboard or or the Legal Department. Employees making a report in shoreside employees or through an external agency, good faith are safeguarded from retaliation. In the event an are investigated thoroughly by the Human Resources employee wishes to make a report anonymously, we have Department, assisted by the Legal Department. provided the ability to do so online or by phone. All reports of misconduct are thoroughly investigated and resolved. Concerns and questionable behavior must be reported. In 2017 P&O Cruises was awarded the Ethics Inside® You can reach the Carnival Corp. Hotline within the United Certification from the Ethisphere® Institute, which is States by calling 888-290-5105, or internationally by calling valid for two years. This highly regarded seal is the +1-305-406-5863. If you would prefer to make a report only independent verification of a company’s ethics and online, you may do so by going to www.carvivalcompliance. compliance program and practices. The seal is awarded com. Reports may be made anonymously (without giving exclusively to companies that can demonstrate a superior your name) where allowed by local law. However, keep in employee and leadership culture that promotes ethical mind that doing so makes it more difficult for our company business practices and that have adequate compliance to conduct a thorough investigation. systems and programs in place to reasonably prevent compliance failures.

Table of Contents 10 Safety, Security and Health

We are committed to maintaining a safe and secure 2006 (MLC 2006), workplace safety, resource conservation To ensure structural integrity, our five ships have double environment on board our ships to enable everyone to enjoy and our dedication to high quality and performance. It’s tanks and a cofferdam and are constructed with a collision a great cruise and to take home only wonderful holiday also subject to ongoing internal and external audits and bulkhead near the bow. Subdivided into multiple watertight memories. Our policies, procedures, staffing and security inspections to ensure the effectiveness of our policies, compartments, our ships can sustain flooding in up to two arrangements are designed so that all our stakeholders procedures and continuous improvement initiatives. adjacent compartments and still remain afloat. As part of can be confident our top priority is ensuring their safety our everyday operations, we leverage computerized stability and security. We conduct regular shipboard and shoreside In 2015 we updated a significant number of our HESS systems to support ship safety. We also have contracts with safety committee meetings which help monitor and advise MS policies and procedures (P&P) after going through a partners who can provide stability expertise from the shore on occupational health and safety programs across the diligent review process led by Carnival Corporation which on an as-needed basis. organization, representing 100 percent of our employees. included all sister companies. This was done not only to In March 2016 the Health, Environment, Safety, Security standardize a significant number of key procedures but Our ships are equipped with automated fire detection and and Sustainability ‘HESSS’ Policy Statement was also to allow each sister company to benefit from the suppression systems in all staterooms, galleys, control announced. This policy is required by the regulations that others’ best practices. The compilation of all revised P&P rooms, mooring decks and public areas. Galley exhaust, govern safety and environmental operations such as the is called the Health, Environment, Safety and Security water mist and CO2 suppression systems on our ships are International Safety Management (ISM) Code and the ISO (HESS) management system (MS), which aims to ensure specially designed to isolate, contain and extinguish fires. Standard for Environmental Management Systems, ISO the consistent application of best practices across all sister We continue to invest in adding new fire safety systems and 14001. The policy commits P&O Cruises Australia to act in companies. improving existing systems, leveraging proven technologies accordance with the following high standards: such as infrared detectors and infrared handheld cameras. • Safeguarding the health of guests, crew, contractors As the HESS MS evolves, P&P will be constantly reviewed and shoreside employees and updated, and shipboard management will be provided Additionally, advanced navigational, weather monitoring • Protecting the environment, using resources efficiently with resources and time to successfully implement any and communication technologies are critical components and sustainably revised P&P. of our ship design. For example, in the event of inclement • Operating all ships and land-based assets safely to weather, our ship performance optimization system enables prevent damage, injury or loss of life Ship Design: the captain to adjust route calculations based on forecast • Ensuring the security of all information and the ship’s specific characteristics. We’ve Lloyd’s Register, our maritime classification society, also invested in a fleet-wide satellite phone system to Learn about our regulatory landscape (pages 127-140). establishes and maintains guidelines for the construction ensure constant global coverage. and maintenance of our ships. Adherence to these SAFETY guidelines is monitored in part through the implementation Employee Training: of regulatory surveys such as the Passenger Ship Safety Safety, security and environmental protection are of prime Survey, which is administered by Lloyd’s Register on an Accident prevention at our company is built on a solid concern to our company. Due to the recent world events, annual basis. Our vessels are registered under the flag of workplace safety program called “Sail Safe” that uses job we continue taking even more rigorous measures to ensure the United Kingdom and are inspected by the Maritime hazard analyses and toolbox discussions to evaluate and the safety and security of our ships, crew and guests. & Coastguard Agency (MCA). Since our ships mainly manage risk. We foster a strong safety culture that allows operate around Australia and New Zealand, our local port our officers and crew members to learn from accidents Management System: state region is governed by the Australian Maritime Safety when they do occur, reducing the likelihood of recurrences. Authority (AMSA) & Maritime New Zealand (MNZ). Our Safety Management System (SMS), called the HESS MS (Health, Environment, Safety and Security, Management System) is core to our company operations. It goes beyond the requirements of the International Safety Management (ISM) Code to address broader considerations such as compliance with the Maritime Labour Convention

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Our commitment to safety is reflected throughout our SECURITY The STCW Manila Amendments became effective Jan. training and development programs. Shaped in accordance 1, 2012, with a transition period until 2017, when all with the Convention on Standards of Training, Certification As is the case with our safety programs, we’ve developed seafarers must be certified and trained according to these and Watchkeeping for Seafarers (STCW), these programs security standards that go beyond regulatory requirements new standards. In 2015 we required all of our shipboard also address emergency preparedness, security, health to protect our guests and employees. We will not go to a employees to participate in mandated security awareness and sanitation, ethics, company policies and procedures, port where our guests or crew would be presented with an training. This training was approved by our flag state and regulatory requirements and job-specific skills. unreasonable risk to their safety and security. Nonetheless, conducted on board by our experienced security teams. we are operating in a changing world which can at times A significant portion of our employee training program present situations where we will be compelled to cancel a Technology & Tools: content is dedicated to the prevention of shipboard port call or re-route a ship. This is done only after careful accidents. Any injury sustained by a shipboard employee or consideration and in an abundance of caution to ensure We regularly upgrade our shipboard screening contractor must be reported according to our guidelines, the continued safety and security of our guests, crew and surveillance systems to leverage technology whether it occurs during working or rest hours, on board and vessels. Our security operations are managed and advancements. These systems enable us to effectively the ship or during shore excursions. In 2017 a total of 49 coordinated by our shoreside Fleet Security team. Fleet monitor and control ship access and screen guests, crew incidents were reported among our shipboard employees, Security is composed of a group with significant law members and luggage. impacting less than 1 percent of our workforce. We enforcement, military and analytical experience. They continue to strive for improvement in this area, and we provide support and guidance to the fleet in dealing with We also ensure all ships are equipped with the necessary won’t be satisfied until incidents are reduced to zero. general security issues on board, monitor and review global tools for internal and external communication in the event security issues and provide security-related information of a security incident. Emergency Preparedness: and recommendations to various corporate departments and executives. Privacy: Our contingency plans are designed to handle shipboard emergencies with immediate and effective support. In case Shipboard Security Teams: We respect the privacy of our guests and crew, and we of an actual emergency, our ships are equipped with life have implemented policies and procedures designed to jackets, lifeboats and emergency supplies for every guest Our ships are staffed with dedicated security teams safeguard their personal information. We are compliant and every crew member on board. In addition, all of our responsible for managing systems and enforcing policies with Australian, New Zealand and European Union ships are equipped with emergency location lighting and around the clock. Led by officers who have extensive requirements, including standards for protecting broadcast communication equipment, including the Global experience in law enforcement and maritime security as information related to the acceptance of credit and debit Maritime Distress Safety System (GMDSS). well as specialized training in investigations and emergency cards for payment. We also take steps to ensure the privacy planning, our shipboard security teams are fully certified of our pocruises.com.au website users. Our online privacy To improve ship safety and ship-to-shore coordination, in accordance with the provisions of STCW, the Maritime policy discloses how we collect, protect, use and share we recently opened a new Fleet Operations Center (FOC) Transportation Security Act (MTSA), the International Ship information gathered on our website. to provide 24/7 operational support to the entire Holland and Port Facility Security (ISPS) Code, the Crimes at Sea America Group fleet. The FOC operates as part of the Act 2000 (Cth) and the UK Merchant Shipping Act 1995. HEALTH Emergency Response Center in Seattle. The FOC is manned by a team of six Fleet Support Officers, who have worked In addition to the specialized training we provide for security Our public health program is built around worldwide public as Navigation Officers. They have access to ship systems, teams, we require each and every shipboard employee health and sanitation regulations and best practices. The shoreside personnel and outside resources to deal with to participate in security training in accordance with the program and its implementation are monitored internally by onboard situations including weather delays, technical provisions of STCW and ISPS, which includes Human public health specialists and externally by national and port problems and issues during shore excursions, local Rights training. We also conduct regular security drills and health authorities. disturbances and security events. exercises in coordination with government agencies.

Learn about our shipboard Safety & Security protocols.

Table of Contents 12 Safety, Security and Health - continued

Health emergencies and communicable disease outbreaks Vessel Sanitation: can affect passengers’ vacations, disrupt onboard services and shorten shipboard careers. Therefore, the capability to The South Eastern Sydney Public Health Unit conducts manage evidence-based health interventions is essential. two comprehensive public health programs for cruise The need for robust health programs at sea is further ships visiting the Port of Sydney: the Cruise Ship Health highlighted by the ever-increasing complexity of the cruise Surveillance Program and the Vessel Inspection Program. industry business model. Ships have become larger and These programs provide operational public health response now carry populations that equal the size of small cities. to infectious disease cases, outbreaks and other incidents Itineraries have become more remote, which can decrease of concern and conduct routine environmental health access to well-equipped shoreside health facilities. Markets inspections of vessels. Other states in Australia or have expanded, potentially exposing guests and crew to New Zealand do not conduct public health inspections at new illnesses. this time. To ensure consistency of standards throughout our fleet, public health standards are incorporated in our Furthermore, guests and crew have become increasingly organization’s Health, Environment, Safety and Security sophisticated in terms of their expectations for evidence- (HESS) management system (MS) system. based, patient-centered and culturally sensitive health services and facilities. Responding to these new challenges requires highly qualified onboard health practitioners as well as shoreside professionals with expertise in multiple health disciplines.

With regard to public health, our certified and well-trained subject matter experts focus on continually improving disease surveillance, outbreak reporting and data analytics and promoting high public health standards on board our vessels. This team responds to norovirus and influenza activity and is also prepared for other public health threats. As is the case in all other areas of the Health Services Department, the public health team is currently working toward the standardization of disease prevention and control activities. Plans also include standardizing internal vessel inspection programs and public health training.

Table of Contents 13 Environment

P&O Cruises Australia is determined to contribute to We have aligned our EMS with the comprehensive We adhere to local, national and international positive environmental change. We work hard to protect the management system established by our parent company, environmental laws and regulations in the jurisdictions places our guests love to visit by minimalizing the impact Carnival Corporation & plc. This system, known internally where our ships sail. Our environmental practices comply of our operations where possible. As a corporate citizen as the Health, Environment, Safety and Security (HESS) with or exceed the requirements of the International we manage the environmental aspects of our operations, Management System, aims to ensure the consistent Maritime Organization (IMO). The Convention for the and it’s one of the most important actions we can take application of best practices across all corporate lines. Prevention of Pollution from Ships — also known as to ensure our business and our industry will continue to MARPOL — establishes regulations to protect the maritime thrive in the years to come. We’re partnering with our team We’re working to integrate sustainable solutions into all environment from pollution that is either accidental or the members, suppliers, peers and other stakeholders across areas of our business, with a strategic focus on optimizing result of routine operations. our value chain to develop innovative solutions and share our operations to maximize efficiency; exploring new ideas best practices that will enable us to collectively conserve and technology to improve performance; and strengthening Learn about our regulatory landscape (Pages 126–140). energy and water, reduce waste and atmospheric emissions our data collection, analysis and management processes. and protect biodiversity.

MANAGEMENT SYSTEM

All of our shipboard team members have environmental In 2017 P&O Cruises established the following environmental goals with a target date of 20201: responsibilities incorporated into their duties. They receive environmental training during their first day on Objectives and Targets board and are supported by our shoreside team members who develop policies and procedures and facilitate Target Units of measure Results communication on an ongoing basis across the fleet. Meet or beat the planned fuel quantity metric tonnes of fuel J ACHIEVED In addition, each ship in our fleet has a full-time Environmental Officer who oversees environmental Reduce non-recycled waste by 5% liters of non-recycled waste per person per day 4 ON TRACK compliance and implementation of procedures. The below 2016 by 2020 Environmental Officer reports to the ship’s Captain and has a direct line of communication to our shoreside Reduce water consumption by 5% liters per person per day 4 ON TRACK environmental management team. We share common below best performing year by 2012. goals, despite the many miles that separate our team members, and we embrace opportunities for continuous improvement through annual corporate conferences and training at the Center for Simulator Maritime Training 1 Data rolls into the Carnival Corp 2020 Sustainability goals, but (CSMART), senior management meetings, our quarterly this table represents the P&O Cruises© performance. The objective HESS & Sustainability Newsletter, monthly phone calls changed from Fuel Consumption Rate measured in grams of fuel used/available lower berth (ALB)* nautical miles traveled (NMT) with Environmental Officers and numerous informal in 2015 to “Meet or beat the planned fuel quantity” measured in communications. metric tonnes of fuel.

We manage the environmental aspects of our operations through our ISO 14001:2015 certified Environmental Management System (EMS). The EMS provides a framework for the fleet’s interactions with the environment, and the Environmental Management System Manual illustrates how we meet the requirements of ISO 14001 and provides a road map to all required procedures.

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ENERGY & EMISSIONS Greenhouse Gas (GHG) Emissions: Indirect Energy — Electricity Purchases:

Responsible energy management is an important The greenhouse gas (GHG) emissions generated by our We purchase electricity for our office use, and in 2017 we component of our sustainability strategy — it’s one of the operations are primarily from fuel burned by ships. These purchased 431 megawatt-hours of electricity. most powerful levers we have to reduce our environmental emissions include greenhouse gases, nitrogen oxides (NOx), footprint while supporting the bottom line. We’re making sulfur oxides (SOx) and particulate matter (PM). We have updated our Scope 2 reporting to reflect The progress in this area by ensuring our ships are designed Greenhouse Gas Protocol’s recently released amended and operated as efficiently as possible while identifying Recognizing that GHG emissions are a significant threat, in Scope 2 guidance, which requires the reporting of location- opportunities to reduce emissions through the use of new 2015 Carnival Corporation & plc set 2020 targets for P&O based emissions and market-based emissions. We have technology. Cruises and our sister cruise lines to reduce the intensity of historically reported location-based emissions, which emissions from shipboard operations by 25 percent against reflect grid-average emission factors. The market-based Direct Energy — Fuel Use: the 2005 performance. Carnival Corporation & plc met this method requires an emission factor that characterizes the goal in 2017. emission rate of untracked or unclaimed energy to prevent We strive to save fuel — the primary source of energy double counting of GHG emission rates among electricity used by our fleet — by purchasing new, more fuel-efficient In 2017 our operations generated emissions equivalent to consumers. We now also include market-based emissions, ships, investing in fuel efficiency technology in the existing about 420,000 metric tonnes of carbon dioxide. The vast which reflect residual mix emissions or emissions from fleet, selecting itineraries that allow optimum ship speed, majority were direct GHG emissions from our ships’ fuel electricity purchases, where available. maintaining equipment in accordance with manufacturers’ consumption. Our indirect emissions were generated by specifications, circulating monthly fuel use data to support electricity purchased for our offices. Energy Reduction Innovations: awareness across ships and sharing fuel conservation best practices. In November 2015, Pacific Ariaand Pacific Eden joined the Over the past two years, P&O Cruises began using its P&O Cruises fleet, increasing the total quantity of GHGs Neptune system to track trends in energy use. This has led Our ships are propelled by diesel electric generators emitted from our ship operations. to a wealth of information to help us decide the best course which are inherently more efficient than traditional marine to reduce energy use. propulsion systems because we can optimize the load between propulsion and other operational needs. A majority Our HVAC systems use about 30 percent of our energy in of the electricity we generate on board our ships is used to port. Because of this, we are implementing a wide range operate our propulsion system, while the remainder is used of HVAC energy efficiency projects. In 2017 we updated to power our lighting, heating, ventilation, air conditioning our HVAC control systems, replaced chillers and installed and refrigeration systems. In 2017 our five-ship fleet used variable-speed drivers which allow the air conditioning to about 130,000 metric tonnes of fuel, generating over 5 be used at less than 100 percent capacity. We are also million gigajoules of energy. piloting demand control ventilation sensors to detect when guests are in a space and we need to bring in fresh air. We We use high-sulfur fuel oil (HSFO), low-sulfur fuel oil will continue to emphasize energy savings through HVAC (LSFO) and marine gas oil (MGO) to power our ships. LSFO improvements throughout our ships. and MGO generate fewer sulfur oxide emissions, and we use these fuels in emission control areas as required. In 2017 97.4 percent of the fuel we used was HSFO, while 2.6 percent of fuel used was MGO.

Exhaust Gas Cleaning Systems (EGCS) are designed to remove sulfur compounds from exhaust before it is emitted into the atmosphere. The Pacific Aria installed EGCS in 2016. All ships will be compliant with Australia’s and New Zealand’s low sulfur standards by 2020.

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WATER Wastewater from Ships:

Fresh water is vital to our shipboard operations. We use All water that is produced or loaded onto our ships is water to prepare food, sanitize kitchen tools and surfaces, used for its intended purpose and then discharged in wash linens and clothes, and clean engine room equipment accordance with — or often exceeding — local, national as well as staterooms and public areas. Additionally, and international laws and regulations. This wastewater is water is available in guestrooms for bathing and hygiene separated into three broad categories named gray water, purposes. black water (permeate/treated black water, biomass/ sewage sludge and untreated black water) and bilge water. Sources & Use: In 2017, we generated over 1 million metric tonnes of wastewater. Our fresh water comes from three different sources: Gray water is wastewater drained from cabin sinks and produced water (seawater that is either evaporated and showers, galleys, salons and laundry facilities. It represents re-condensed or produced by a reverse osmosis plant the largest volume of wastewater generated by our ships, and treated with minerals and chlorine); bunkered water, and it may be treated or untreated prior to discharge, which is purchased from port communities and stored in depending upon ship capabilities. It is always discharged designated potable water holding tanks; and condensate, in full compliance with applicable laws and regulations. In which on some ships is collected from our air-conditioning 2017, we discharged approximately 671,000 metric tonnes units and used for technical cleaning purposes. We bunker of untreated gray water, which accounted for 66 percent of water from ports where we know water is plentiful, high all wastewater discharged from our fleet. in quality and costs less than the fuel needed to produce water on board. Bilge water is wastewater collected in the lower part Black water is waste from toilets and medical facility sinks. of the ship, known as the bilge. This water contains oils In 2017, we generated just over 331,000 metric tonnes of released from equipment in engine compartments. To treated black water, which accounted for 33 percent of all In 2017 our fleet consumed over 900,000 metric tonnes of treat bilge water we use a cascade bilge water treatment wastewater discharged from our fleet. All five ships are water. Eighty-four percent was produced on board, and 16 system, which circulates and recirculates fluid through equipped with advanced wastewater purification systems percent was bunkered or purchased from shore. Because increasingly efficient oil-water separators until the oil that treat black water. Some of these systems treat gray the quantity of condensate generated can’t be measured for content is reduced to below 15 parts per million. In 2017, water as well. These systems use primary filtration, bio all ships in the fleet, it is not reflected in our data. we generated approximately 8,000 metric tonnes of treated digestion, ultrafiltration and ultraviolet light technology to bilge water, which accounted for less than one percent of produce a discharge — called permeate — that is superior in In 2017 our operations used 220 liters of water per all wastewater discharged from our fleet. The total volume quality to effluent discharged from municipal wastewater person per day. While this is 36 percent less than the 340 of bilge water discharges increased by 53 percent between treatment plants in most communities. liters used per person per day in the average Australian 2015 and 2017 due to the addition of Pacific Aria and household, it represents a 2.5 percent increase in our Pacific Eden to the P&O Cruises’ fleet at the end of 2015. On occasion, as a result of equipment malfunction or consumption rate since 2014. We continue to strive storage limitations, a ship may need to discharge untreated for future improvement by leveraging water-saving black water directly overboard where legally permitted to technologies and educating our guests and crew members do so (outside 12 miles from shore, traveling at a rate in about water conservation. We are also identifying high- excess of four knots and not within any protected areas). performing ships and share best practices. Except in the case of emergency, our policy requires a ship to first obtain permission from shoreside management before proceeding with a discharge of untreated black water. Such discharges are prescreened to remove plastics and other similar solids.

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Accidental Releases: SOLID WASTE

We work hard to protect water quality and prevent In 2017 our fleet generated approximately 15,000 metric accidental spills. When spills occur, they most often contain tonnes of solid waste. Excluding recycling, this represents water, fuel, hydraulic fluid or lubricating oil. These materials 2.9 kilograms of waste per person per day. We are reducing are necessary for the operation of shipboard mechanical this amount by identifying high-performing ships to share systems which are inspected, monitored and maintained best practices. We also engage shoreside vendors to find by our employees. If leaks occur, they typically range more recycling opportunities. from a few drops to a few pints or liters. Our crews are required to report any incident in which a sheen is observed In FY2016, we commenced a comprehensive evaluation on seawater. For internal reporting purposes, corporate of our waste management accounting practices and standards require us to report any release of fluid that is in introduced a new approach for sustainability reporting excess of 0.5 liter (500 ml). purposes. Operating on a global scale presents challenges for reporting waste consistently since countries have No fines occured for non-compliance with environmental different definitions and categories of waste, as well laws and regulations related to accidental releases in 2016 as different reporting requirements. With the goal of or 2017. continuous operational improvement, we refocused our efforts to standardize waste definitions and units of TOTAL NUMBER & VOLUME OF REPORTABLE SPILLS measure across our global brands. This approach allows for consistent trend analysis and reporting. For regulatory Measure Units 2015 2016 2017 reporting purposes, we comply with the requirements of the particular country where waste is landed. At present, when recycling services aren’t available in port Total Number of Number 1 5 4 communities, we incinerate solid waste on board our ships Reportable Spills Our waste management approach focuses on reducing or dispose of it at local landfills. Shipboard incinerators the volume and toxicity of waste we generate. Whenever substantially reduce the volume of combustible materials Total Volume of Liters 0 0 56 possible, we reuse existing materials and equipment, and such as paper and cardboard, transforming them into non­ Reportable Spills we recycle where recycling infrastructure is available at hazardous waste in the form of ash. our ports of call. We collaborate with stakeholders across our value chain to advance these efforts, donating reusable The amount of hazardous waste generated slightly Grievances: goods from our ships to nonprofit organizations and working increased by 200 metric tonnes between 2016 and 2017. with port authorities to identify additional vendors who are Our new accounting practices established in 2016 regard We occasionally receive grievances about labor practices, capable of recycling cruise ship waste. oil sludge as hazardous waste only in jurisdictions where it human rights, impacts on society, environment, guest is classified as hazardous waste. In both cases the waste is privacy and guest relations, among others. We evaluate Solid waste generated by our shipboard operations is recycled. and manage all grievances we receive within a reasonable recycled or disposed of on shore or incinerated on board. timeframe. Between FY2015 and FY2017 we did not receive Recyclable materials are separated from trash and In 2017 the only solid waste discharged to sea from our any sanctions for non-compliance with non-environmental collected on all of the ships in our fleet. Our efforts to ships was food waste, which accounted for nine percent of laws and regulations. increase recycling include an assessment of some of our the total solid waste generated by the fleet. most frequently visited port communities in the Pacific region. By following P&O Cruises waste from the pier to recycling facilities and landfills, we learned about local regulations and infrastructure challenges as well as opportunities to expand and optimize our recycling efforts in the future.

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BIODIVERSITY The very nature of our itineraries mitigate the potential for hull biofouling. Our ships are rarely in port for more than As an extension of our commitment to sustainability, we 12 hours at a time, limiting the time marine species have strive to protect the earth’s biodiversity by minimizing to attach to the hull. Additionally, sailing speeds between water and air pollution and by responsibly disposing of ports are typically fast enough to ‘scrub’ the hull of any solid waste. Below are a few examples of our other major marine species. initiatives to protect biodiversity. Hull husbandry is another way that P&O Cruises Biofouling: prevents biofouling. Hull husbandry includes application of antifouling hull coatings, hull cleaning, maintenance Biofouling occurs when marine organisms such as mussels, and the use of active Marine Growth Prevention Systems. barnacles, algae or other living organisms attach to Special silicon-based underwater coatings are designed to ships. Preventing biofouling minimizes the potential of maintain a smooth surface which inhibits marine growth transporting non-native species to other locations where attachment. Periodic hull cleaning removes the incidental they could overwhelm native populations. Biofouling growth that does occur, and periodic maintenance of prevention thus preserves biodiversity in the places we internal seawater pipes and systems removes any sail. P&O Cruises employs several strategies to prevent accumulated biofouling in our internal seawater systems. biofouling or remove marine organisms from the hull such Active Marine Growth Prevention Systems employ cathodic as holding ballast water management/treatment and hull or ultrasonic systems that also inhibit marine growth in husbandry. those internal surfaces. These methods reduce the risk of introducing non-native species to sensitive marine areas Ballast water is seawater that is pumped into dedicated and have the added benefit of reducing fuel consumption, tanks on a ship to provide weight—or ballast—at the bottom with the consequent reduction in engine emissions. of the ship, enhancing stability. When properly managed, the risk of introducing non-indigenous invasive species The Nature Conservancy: when ballast water is discharged is reduced. In 2014 our parent company, Carnival Corporation and plc, P&O Cruises has IMO-approved ballast water treatment launched a five-year, $2.5 million support commitment systems on four of its five ships. For the ship without ballast with The Nature Conservancy. The Nature Conservancy water treatment, our current practice is to hold ballast is one of the world’s leading conservation organizations, water while in port whenever possible. If a discharge is working across all sectors of industry and society to help anticipated, ballast water from one location is exchanged in advance its mission to protect the natural world and deep waters in transit, prior to arriving in another location. develop relationships that best align to produce clear This avoids the transfer of non-indigenous species between conservation benefits with lasting, measurable outcomes. two different nearshore marine environments and has been This partnership is supporting The Nature Conservancy’s shown to minimize potential impacts. We record and report Mapping Ocean Wealth (MOW) program. This program all ballast water exchanges and discharges as required by creates maps that show the extent and distribution of local, national and international laws and regulations. benefits that habitats like coral reefs and mangroves provide, including fish production, flood mitigation, erosion control and recreation.

Table of Contents 18 community

As the leading cruise line operating in the Pacific region, we According to Cruise Lines International Association (CLIA), are mindful of our potential to positively impact the social, cruise passengers spent a total of AUD 1.2 billion at economic and environmental health of the communities Australian cruise ports in 2016/17, an increase of 20% where we operate. over 2015/16.

With our guests, we established the P&O Pacific Partnerships: Partnership program to help give back to the communities which have been so warmly welcoming to us. When Cruise Lines International Association (CLIA) is the choosing a community-based partner with which to work, world’s largest cruise industry trade association, with P&O Cruises Australia looks for organizations that are representation in North and South America, Europe, already working in the regions that our ships visit and that Asia and Australasia. We continue to support CLIA in are part of the fabric of a community. establishing policies and practices that foster a safe, secure, healthy and sustainable cruise ship environment. The P&O Pacific Partnership has raised about AUD 1 million in voluntary contributions from guests and special A recent economic impact study commissioned by CLIA donations over four years. In this period, our principal Australasia revealed that the cruise industry contributed charity partner has been Save the Children Australia , with a record AUD $4.6 billion to the Australian economy in a particular focus on projects in Vanuatu Papua New Guinea 2015/16. The study also highlighted the positive impact of and the Solomon Islands. a record number of ships being homeported in Australia, along with nearly 19,000 jobs linked to cruising — an OUR COMMUNITIES increase of 23 percent. The addition of Pacific Aria and Pacific Eden to the P&O Cruises fleet was identified as Port Communities: one of the two major factors in the stunning 45 percent increase in the number of home port ship visit days. In 2017, our five ships visited more than 90 ports in the Pacific region. In addition to the ports we visit, we had eight SUPPLY CHAIN home ports during the year: In Australia they were Adelaide, Brisbane, Cairns, Fremantle, Melbourne and Sydney. P&O In 2014, we released our Business Partner Code of Conduct Cruises also homeported from Auckland in New Zealand, and Ethics. This Code is intended to help our business as well as Singapore. We visit ports of call with varying partners within our supply chain more fully understand frequency and adjust itineraries based on consumer and comply with our expectations for legal compliance and demand and our ability to ensure the safety, security and ethical behavior, as this is a fundamental aspect of our core health of our guests and employees. values.

One of the most significant ways our business can make We interact with thousands of suppliers every year a positive impact in port communities is by supporting globally. Before we engage with vendors, we complete jobs in the tourism industry. In 2017 P&O Cruises ships all documentation, perform reputational research and carried about 470,000 guests to developed and emerging complete a vetting process. We regularly conduct supplier destinations. Our operations supported demand for hotels, visits while engaging in special projects or when purchases tour operators, taxis, restaurants and cafés, shopping and reach certain thresholds. entertainment as well as local producers of milk, eggs, fresh fruit and vegetables as well as beef and lamb.

Table of Contents 19 community - continued

At P&O Cruises, we have two supply chain streams: wish or donate more through the onboard donation boxes. Disaster Relief: technical purchasing (parts and services) and consumable In addition, the navigational chart from each voyage is purchasing (food and beverage items and housekeeping auctioned at the end of every cruise. The Pacific Islands on occasion are affected by natural supplies). Due to the significant amount of “on-the-spot” disasters that can be particularly challenging for developing purchasing in the technical supply chain, we achieve The partnership has seen the creation of two kindergartens, economies. At times of crisis, the P&O Pacific Partnership competitive pricing while ensuring quality by actively five health aid posts and a larger health dispensary in has assisted with funds for essential healthcare supplies identifying key vendors that we acquire through a Vanuatu. In 2016 the program donated two Toyota Hilux and supported the establishment of temporary learning vigorous vetting process. We achieve competitive pricing 4x4 motor vehicles to Save the Children’s Vanuatu-based centers and health aid posts. The partnership has while ensuring quality in the consumable supply chain team to assist with the distribution of aid and to manage previously provided support following Typhoon Haiyan by participating in global bids through AllBrands Global program quality. By the end of 2016 work had begun on (Philippines, 2013), Cyclone Pam (Vanuatu, 2015) and Sourcing, a department within Carnival Corporation & plc. two new projects to support maternal health in Papua Cyclone Winston (Fiji, 2016). By consolidating information through AllBrands Global New Guinea and early childhood education in the Solomon Sourcing, we are better able to manage and control our Islands. Following Cyclone Winston, the Partnership donation of supply chain processes since we are collectively working AUD 50,000 to support Save the Children in establishing together with our sister brands. AllBrands Global Sourcing Carnival Australia, through its homegrown P&O Cruises 12 temporary learning spaces, allowing children to identifies key vendors through a vigorous vetting process. brand, has always sought to support the communities resume their education as soon as possible and to help which it visits. In February 2016 a Category 5 tropical them recover from the sense of displacement through the From our vendors, we require a 100 percent commitment cyclone, Cyclone Winston, hit the South Pacific island restoration of routine and normality. to improving the quality and accuracy of the deliveries. We nation of Fiji. Carnival Australia responded by contributing continuously work with our vendors to improve the use of AUD 125,000 to Save the Children Australia’s disaster relief Learn more about our disaster relief efforts. carton and pallet manifesting and documentation. We no in Fiji. This was comprised of AUD 50,000 from Carnival longer accept wooden pallets on board, as we transitioned Corporation’s Carnival Foundation; AUD 50,000 from the to plastic pallets which are reused. P&O Pacific Partnership passenger contributions; and AUD 25,000 from Princess Cruises. GIVING & VOLUNTEERISM Learn more about P&O Pacific Partnership. Partnerships: Lifeline Partnership P&O Pacific Partnership Since 2010, P&O Cruises has partnered with Lifeline to Save the Children Australia and P&O Cruises have been donate furnishings which are no longer needed on board partners since 2013, working together to help children and but are still in good condition. Lifeline is a national charity families in Pacific countries. More than AUD 1 million has providing Australians with 24-hour crisis and suicide been donated to Save the Children’s work in the Pacific, prevention support through a free phone counseling allocated across five countries to support the areas of service. A network of more than 200 Lifeline retail outlets greatest need involving health, education, child protection across Australia that sell quality used goods funds the and natural disaster response. phone counseling service. Surplus items that P&O Cruises gives Lifeline include furniture, bedding and cutlery. P&O The P&O Pacific Partnership is funded by a voluntary Cruises has also traditionally contributed a cruise as part of one dollar contribution by guests on each P&O Cruises Lifeline’s major annual fundraising event. booking. This donation applies to guests over the age of 18 on all cruises. Guests can opt out of the program if they Learn more about Lifeline Australia.

Table of Contents 20 Performance summary

Environmental Data Footnotes 1) Carnival Corporation & plc data independently verified by Lloyd’s Register Quality Assurance (LRQA) P&O Cruises Units 2015 2016 2017 in accordance with ISO 14064-3:2006, “Greenhouse gases – Part 3: Specification with guidance for the validation and verification of greenhouse gas assertion.” Total Ships Number 3 5 5 2) Revised FY2017 emission factors in accordance with The Climate Registry Intergovernmental Panel Greenhouse Gas Emissions (GHGs)1 on Climate Change (IPCC) Fourth Assessment Report (AR4). 3) The conversion factors to obtain the amount of CFC-equivalent from the various types of refrigerant Total GHG Emissions - Location Based Metric Tonnes CO2e 281,565 428,856 419,781 gases given in the Montreal Technical Papers. FY2016 increase was due to accidental releases of a gas with a high ODS value into the environment. Total GHG Emissions - Market Based Metric Tonnes CO2e 281,565 428,856 419,781 4) The SOx weight calculations take into account the weighted-average sulfur content of the fuel Direct GHG Emissions Metric Tonnes CO2e 281,039 428,435 419,464 consumed and the default emission factors. The default emission factor used for calculating SOx value is %S x 20 x 0.96, where S is the fuel sulfur content. This calculation has not been adjusted to Ship Direct GHG Emissions Metric Tonnes CO2e 280,957 428,339 419,371 account for the exhaust gas cleaning systems (EGCS) used. 5) The NOx weight is calculated based on default emission factors. The default emission factor used Ship Fuel GHG Emissions Metric Tonnes CO2e 265,529 409,689 406,034 for calculating NOx value for HFO/LFO is 78 kg, MGO is 80 kg, and LNG is 7 kg of NOx per tonne of fuel consumed. Ship Refrigerant GHG Emissions2 Metric Tonnes CO2e 15,427 18,650 13,337 6) PM2.5 refers to particles with diameters between 2.5 and 10 micrometers. The PM2.5 weight is calculated based on default emission factors. The default emission factor used for calculating PM Shore Direct GHG Emissions Metric Tonnes CO2e 82 95 93 2.5 value for HFO is 0.82 kg, LFO is 0.75 kg, MGO is 0.15 kg, and LNG negligible kilograms of PM2.5 per tonne of fuel consumed. This calculation has been adjusted to account for EGCS use in FY2016 and FY2017. Indirect GHG Emissions - Location Based Metric Tonnes CO2e 527 421 317 This adjustment was made based on PM2.5 emissions reduction resulting from planned HFO fuel consumption during EGCS operations. Shore Indirect GHG Emissions - Location Based Metric Tonnes CO2e 527 421 317 7) Independently verified by Lloyd’s Register Quality Assurance (LRQA) Ship Indirect GHG Emissions - Location Based Metric Tonnes CO2e 0 0 0 8) Treated black water discharges include treated black wastewater, treated gray wastewater and black and gray wastewater mixtures. Indirect GHG Emissions - Market Based Metric Tonnes CO2e 527 421 317 9) Carnival’s policy is to treat all black water prior to discharge to sea. These volumes are the result of Shore Indirect GHG Emissions - Market Based Metric Tonnes CO2e 527 421 317 accidental/ equipment failure discharges. 10) In FY2016, we commenced a comprehensive evaluation of our waste management accounting Ship Indirect GHG Emissions - Market Based Metric Tonnes CO2e 0 0 0 practices and introduced a new approach for sustainability reporting purposes. With the goal of continuous operational improvement, we refocused our efforts to standardize waste definitions, units Ship Fuel Greenhouse Gas Emission Rate Grams CO2e/ ALB-Km 289 296 307 of measure and densities across our global brands. This approach allows for consistent trend analysis and reporting. For regulatory reporting purposes, we comply with the requirements of the particular Air Emissions country where waste is landed. FY2016 and FY2017 reflect this new approach, therefore FY2015 has not been included as it is not comparable. It should be noted that during this transition process, some Ship Fugitive Refrigerant Releases1 Kilograms 9,745 11,114 7,376 data was not available or classified appropriately and therefore certain assumptions were made to reflect performance. Ship Ozone Depleting Substances (ODS) Emissions1,3 Kg CFC-11e 35 0 0 11) As of FY2016, Carnival Corporation & plc’s definition of hazardous waste is in accordance with 4 most recognized waste management practices worldwide, though some countries may have Total SOx Emissions Metric Tonnes 4,416 6,611 6,723 somewhat different definitions. For regulatory purposes, Carnival Corporation & plc complies with the requirements of the particular country where waste is landed. Carnival Corporation & plc uses the SOx Emissions Rate Kg SOx/NM 14.2 13.0 14.1 most inclusive definition of hazardous waste for sustainability reporting purposes, which standardizes 5 waste reporting quantities independent of how the wastes are classified when landed ashore, thus Total NOx Emissions Metric Tonnes 6,588 10,163 10,074 potentially resulting in higher reported aggregate quantities of hazardous waste but allowing for more consistent trend analysis. NOx Emissions Rate Kg NOx/NM 21.2 20.0 21.1 12) A significant spill is defined as a spill for which the monetary sanctions are $100,000 or greater, Total Particulate Matter (PM2.5) Emissions6 Metric Tonnes 68 102 104 and which is reportable in the Carnival Corporation & plc Annual Report on Form 10-K. 13) Carnival has defined a reportable spill for internal reporting purposes as a release of soot as well Particulate Matter (PM2.5) Emission Rate Kg PM/NM 0.22 0.20 0.22 as a release of oil/grease/chemicals that is in excess of 0.5 liters (500 ml). However, in U.S. waters a spill that causes oil sheen is also reported and included in the total number of spills reported, even though the volume may be less than 0.5 liters.

Table of Contents 21 Performance summary - continued

Environmental Data - Continued Footnotes 1) Carnival Corporation & plc data independently verified by Lloyd’s Register Quality Assurance (LRQA) P&O Cruises Units 2015 2016 2017 in accordance with ISO 14064-3:2006, “Greenhouse gases – Part 3: Specification with guidance for the validation and verification of greenhouse gas assertion.” Total Ships Number 3 5 5 2) Revised FY2017 emission factors in accordance with The Climate Registry Intergovernmental Panel Energy & Electricity on Climate Change (IPCC) Fourth Assessment Report (AR4). 3) The conversion factors to obtain the amount of CFC-equivalent from the various types of refrigerant Total Direct Energy Consumption7 Gigajoules 3,446,907 5,326,572 5,272,466 gases given in the Montreal Technical Papers. FY2016 increase was due to accidental releases of a gas with a high ODS value into the environment. Ship Direct Energy Consumption Gigajoules 3,445,720 5,325,197 5,271,117 4) The SOx weight calculations take into account the weighted-average sulfur content of the fuel Shore Direct Energy Consumption Gigajoules 1,187 1,375 1,348 consumed and the default emission factors. The default emission factor used for calculating SOx value is %S x 20 x 0.96, where S is the fuel sulfur content. This calculation has not been adjusted to Total Direct Energy Consumption Rate Kilojoules/ ALB-Km 3,752 3,849 3,985 account for the exhaust gas cleaning systems (EGCS) used. 5) The NOx weight is calculated based on default emission factors. The default emission factor used Total Ship Fuel Consumption7 Metric Tonnes 84,423 130,127 129,064 for calculating NOx value for HFO/LFO is 78 kg, MGO is 80 kg, and LNG is 7 kg of NOx per tonne of fuel consumed. Ship Fuel Consumption Rate7 Grams Fuel/ ALB-Km 91.9 94.0 97.6 6) PM2.5 refers to particles with diameters between 2.5 and 10 micrometers. The PM2.5 weight is calculated based on default emission factors. The default emission factor used for calculating PM Total Purchased Electricity MWh 640 573 431 2.5 value for HFO is 0.82 kg, LFO is 0.75 kg, MGO is 0.15 kg, and LNG negligible kilograms of PM2.5 per tonne of fuel consumed. This calculation has been adjusted to account for EGCS use in FY2016 and FY2017. Shore Purchased Electricity MWh 640 573 431 This adjustment was made based on PM2.5 emissions reduction resulting from planned HFO fuel consumption during EGCS operations. Ship Purchased Electricity MWh 0 0 0 7) Independently verified by Lloyd’s Register Quality Assurance (LRQA) 1 Ship Fuel 8) Treated black water discharges include treated black wastewater, treated gray wastewater and black and gray wastewater mixtures. High Sulfur Fuel Oil (HSFO) Percent 98.2 94.8 97.4 9) Carnival’s policy is to treat all black water prior to discharge to sea. These volumes are the result of Low Sulfur Fuel Oil (LSFO) Percent 0.0 0.0 0.0 accidental/ equipment failure discharges. 10) In FY2016, we commenced a comprehensive evaluation of our waste management accounting Marine Diesel Oil/Marine Gas Oil (MDO/MGO) Percent 1.8 5.2 2.6 practices and introduced a new approach for sustainability reporting purposes. With the goal of continuous operational improvement, we refocused our efforts to standardize waste definitions, units Liquefied Natural Gas (LNG) Percent 0.00 0.00 0.00 of measure and densities across our global brands. This approach allows for consistent trend analysis and reporting. For regulatory reporting purposes, we comply with the requirements of the particular Potable Water country where waste is landed. FY2016 and FY2017 reflect this new approach, therefore FY2015 has not been included as it is not comparable. It should be noted that during this transition process, some Total Water Consumption7 Metric Tonnes 582,454 918,360 904,212 data was not available or classified appropriately and therefore certain assumptions were made to reflect performance. Water Purchased (From Shore) Metric Tonnes 69,991 105,745 146,872 11) As of FY2016, Carnival Corporation & plc’s definition of hazardous waste is in accordance with most recognized waste management practices worldwide, though some countries may have Water Produced (From Sea) Metric Tonnes 512,463 812,615 757,340 somewhat different definitions. For regulatory purposes, Carnival Corporation & plc complies with the requirements of the particular country where waste is landed. Carnival Corporation & plc uses the Water Consumption Rate Liters/Person-Day 208 215 220 most inclusive definition of hazardous waste for sustainability reporting purposes, which standardizes waste reporting quantities independent of how the wastes are classified when landed ashore, thus potentially resulting in higher reported aggregate quantities of hazardous waste but allowing for more consistent trend analysis. 12) A significant spill is defined as a spill for which the monetary sanctions are $100,000 or greater, and which is reportable in the Carnival Corporation & plc Annual Report on Form 10-K. 13) Carnival has defined a reportable spill for internal reporting purposes as a release of soot as well as a release of oil/grease/chemicals that is in excess of 0.5 liters (500 ml). However, in U.S. waters a spill that causes oil sheen is also reported and included in the total number of spills reported, even though the volume may be less than 0.5 liters.

Table of Contents 22 Performance summary - continued

Environmental Data - Continued Footnotes 1) Carnival Corporation & plc data independently verified by Lloyd’s Register Quality Assurance (LRQA) P&O Cruises Units 2015 2016 2017 in accordance with ISO 14064-3:2006, “Greenhouse gases – Part 3: Specification with guidance for the validation and verification of greenhouse gas assertion.” Total Ships Number 3 5 5 2) Revised FY2017 emission factors in accordance with The Climate Registry Intergovernmental Panel Wastewater on Climate Change (IPCC) Fourth Assessment Report (AR4). 3) The conversion factors to obtain the amount of CFC-equivalent from the various types of refrigerant Bilge Water Discharge to Sea7 Metric Tonnes 5,484 10,624 8,385 gases given in the Montreal Technical Papers. FY2016 increase was due to accidental releases of a gas with a high ODS value into the environment. Bilge Water Sea Discharge Rate7 Liters/NM 17.61 20.89 17.57 4) The SOx weight calculations take into account the weighted-average sulfur content of the fuel consumed and the default emission factors. The default emission factor used for calculating SOx Total Gray Water Discharged Metric Tonnes 573,693 587,764 671,076 value is %S x 20 x 0.96, where S is the fuel sulfur content. This calculation has not been adjusted to Gray Discharged to Sea Metric Tonnes 572,811 587,336 669,625 account for the exhaust gas cleaning systems (EGCS) used. 5) The NOx weight is calculated based on default emission factors. The default emission factor used Gray Discharged to Shore Metric Tonnes 882 428 1,451 for calculating NOx value for HFO/LFO is 78 kg, MGO is 80 kg, and LNG is 7 kg of NOx per tonne of fuel consumed. Gray Water Discharge Rate Liters/Person-Day 204.89 137.67 163.64 6) PM2.5 refers to particles with diameters between 2.5 and 10 micrometers. The PM2.5 weight is calculated based on default emission factors. The default emission factor used for calculating PM Total Black Water Discharged Metric Tonnes 156,638 330,596 332,173 2.5 value for HFO is 0.82 kg, LFO is 0.75 kg, MGO is 0.15 kg, and LNG negligible kilograms of PM2.5 per tonne of fuel consumed. This calculation has been adjusted to account for EGCS use in FY2016 and FY2017. Treated Black Water Discharged to Sea8 Metric Tonnes 156,638 326,049 325,856 This adjustment was made based on PM2.5 emissions reduction resulting from planned HFO fuel consumption during EGCS operations. Treated Black Water Discharged to Shore8 Metric Tonnes 0 0 6,092 7) Independently verified by Lloyd’s Register Quality Assurance (LRQA) 9 Untreated Black Water Discharged to Sea Metric Tonnes 0 4,534 225 8) Treated black water discharges include treated black wastewater, treated gray wastewater and black and gray wastewater mixtures. Untreated Black Water Discharged to Shore Metric Tonnes 0 13 0 9) Carnival’s policy is to treat all black water prior to discharge to sea. These volumes are the result of Black Water Discharge Rate8 Liters/Person-Day 55.9 77.4 81.0 accidental/ equipment failure discharges. 10) In FY2016, we commenced a comprehensive evaluation of our waste management accounting Waste Disposal10 practices and introduced a new approach for sustainability reporting purposes. With the goal of continuous operational improvement, we refocused our efforts to standardize waste definitions, units Total Waste Metric Tonnes - 14,978 14,494 of measure and densities across our global brands. This approach allows for consistent trend analysis and reporting. For regulatory reporting purposes, we comply with the requirements of the particular Hazardous Waste11 Metric Tonnes - 5,336 5,580 country where waste is landed. FY2016 and FY2017 reflect this new approach, therefore FY2015 has not been included as it is not comparable. It should be noted that during this transition process, some Non-Hazardous Waste Metric Tonnes - 9,642 8,913 data was not available or classified appropriately and therefore certain assumptions were made to reflect performance. Waste Recycled Kilograms/Person-Day - 2.9 2.9 11) As of FY2016, Carnival Corporation & plc’s definition of hazardous waste is in accordance with most recognized waste management practices worldwide, though some countries may have Waste Rate (Excluding Recycling) Percent - 16.2 18.2 somewhat different definitions. For regulatory purposes, Carnival Corporation & plc complies with the 7 requirements of the particular country where waste is landed. Carnival Corporation & plc uses the Spills & Fines most inclusive definition of hazardous waste for sustainability reporting purposes, which standardizes waste reporting quantities independent of how the wastes are classified when landed ashore, thus 2 Total Number of Significant Spills1 Number 0 0 0 potentially resulting in higher reported aggregate quantities of hazardous waste but allowing for more consistent trend analysis. Total Number of Reportable Spills13 Number 1 5 4 12) A significant spill is defined as a spill for which the monetary sanctions are $100,000 or greater, Total Volume of Reportable Spills Liters 0 0 56 and which is reportable in the Carnival Corporation & plc Annual Report on Form 10-K. 13) Carnival has defined a reportable spill for internal reporting purposes as a release of soot as well Total Number of Non-monetary Sanctions Number 0 0 0 as a release of oil/grease/chemicals that is in excess of 0.5 liters (500 ml). However, in U.S. waters a spill that causes oil sheen is also reported and included in the total number of spills reported, even Monetary Value of Fines US Dollars($) 0 0 0 though the volume may be less than 0.5 liters.

Table of Contents 23 Performance summary - continued

Social Data - Shipboard Workforce Average Crew Number 2,143 2,976 2,801 Diversity Labor Sourcing Region1: Africa Percent 2.1 1.2 1.7 Asia Percent 71.0 77.3 82.7 Australia Percent 10.3 10.1 9.0 Europe Percent 8.4 8.0 5.1 North & Central America Percent 1.3 2.9 1.2 South America Percent 0.1 0.6 0.4 Gender Distribution - Female Percent 22.7 21.9 19.9 Gender Distribution - Male Percent 77.3 78.1 80.1 Injuries & Fatalities Total Injuries Number 27 52 49 Minor Injuries Number 13 18 22 Serious Injuries Number 5 11 10 Major Injuries Number 9 23 17 Accidental Deaths Number 0 0 0 Other Statistics Footnotes Employee Turnover2 Percent 54.5 23.7 22.8 1) For FY2017 enhanced data control processes to improve consistency.

Employees Covered by Collective Bargaining Agreements (CBA)2 Percent 0.2 100.0 100.0 2) In FY2017, we identified and corrected data entry errors regarding collective bargaining agreements (CBA) and turnover for FY2016. In the internal data verification process an error was Employees Represented by Health & Safety (H&S) Committees Percent 100.0 100.0 100.0 detected and thereby fixed for this reporting cycle.

Table of Contents 24 Performance summary - continued

Social Data - Shoreside Unit 2015 2016 2017 Workforce Average Number of Full Time Employees Number 325 349 351 Average Number of Part Time/Seasonal Employees Number 39 40 37 Shoreside Employee Status - Full Time Percent 89.3 89.7 90.5 Shoreside Employee Status - Part Time Percent 10.7 10.3 9.5 Diversity Gender Distribution - Female Percent 60.7 58.6 59.5 Gender Distribution - Male Percent 39.3 41.4 40.5 Employees by Brand Headquarter Region3 Australia Percent 100.0 100.0 100.0 Europe Percent 0.0 0.0 0.0 North America Percent 0.0 0.0 0.0 Injuries & Fatalities Injuries4 Number 0 3 0 Accidental Deaths Number 0 0 0 Training & Performance Footnotes Total Training Hours 126 209 188 2) In FY2017, we identified and corrected data entry errors regarding collective bargaining Other Statistics agreements (CBA) and turnover for FY2016. In the internal data verification process an error was detected and thereby fixed for this reporting cycle. Employee Turnover2 Percent 24.5 16.5 16.2 3) In addition to our headquarter locations, other offices are located worldwide. Due to varying Employees Covered by Collective Bargaining Agreements (CBA)3 Percent 54.7 41.6 40.2 legal requirements worldwide, further detail on employee base is limited.

Employees Represented by Health & Safety (H&S) Committees Percent 100.0 100.0 100.0 4) For FY2017 enhanced data control processes to improve consistency.

Table of Contents 25 report parameters

We work closely with all other operating lines under Reporting History & Cadence Terminology Carnival Corporation & plc. Together with key stakeholders, we address sustainability issues in the cruise industry, in This report is our second Sustainability Report, focusing In this report we attempt to avoid the use of industry jargon the broader maritime industry and with companies in other on fiscal year (FY) 2017 (December 1, 2016–November 30, and provide definitions for terms that aren’t commonly used industries. 2017). outside of our industry. Select definitions can be found in the Glossary. This Sustainability Report covers and prioritizes information Beginning with 2017, our goal is to report on our on the basis of materiality, sustainability context and sustainability performance on a biennial basis. Materiality Assessment & Matrix stakeholder inclusiveness. It includes entities that meet the criteria of being subject to our operational control. The Information Integrity P&O Cruises adopted the materiality assessment of information in this Sustainability Report includes significant our parent company, Carnival Corporation & plc. This actions or events in the reporting period, and it does not Information provided in this report was compiled in assessment is conducted every two years by Carnival intentionally exclude relevant information that would management systems, extracted from databases and Corporation & plc. During this evaluation process, Carnival influence or inform stakeholder assessments or decisions verified by our management for accuracy. We believe this Corporation & plc analyzed issues that are important or that would reflect significant economic, environmental or information fairly represents our corporate responsibility to the company and stakeholders. The materiality social impacts. activities and performance results for the reporting period. assessment helps determine areas of focus for this report Lloyd’s Register Quality Assurance, Inc. (LRQA), an affiliate and our sustainability work. As greenhouse gas (GHG) emissions represent one of of Lloyd’s Register North America, Inc., was commissioned our main operational impacts, we include purchases of by Carnival Corporation & plc to assure its Greenhouse Gas shipboard and shoreside energy (fuel and electricity). (GHG) Emissions Inventory and GHG Assertion for the fiscal We have normalized the majority of our indicators to take year 2017 (December 1, 2016– into account the changes in fleet size as well as changes in November 30, 2017). P&O Cruises’ itineraries and guest capacity. data was verified as part of this process. Carnival Corporation & This report is part of our initiative to better understand our plc 2017 Annual Sustainability impacts, to improve our performance wherever possible Report (pages 142–143). and to maximize the benefits of our activities where appropriate, with the aim of managing our company for Throughout the report we’ve long-term sustainability. It specifically focuses on fiscal included links to helpful year (FY) 2017 (December 1, 2016–November 30, 2017), information that is available unless otherwise noted. on P&O Cruise and Carnival Corporation & plc websites, as All references to currency are in AUD unless otherwise well as third-party websites. noted.

This report was developed in accordance with the core level of the Global Reporting Initiative’s (GRI) Standards. We’ve shared performance information related to indicators that we selected in collaboration with our parent company, Carnival Corporation & plc.

Table of Contents 26 Glossary

Audit CO2 (Carbon Dioxide) Exhaust Gas Cleaning System (EGCS) Systematic, documented, periodic and objective A naturally occurring chemical compound composed of two Abatement technology used to reduce the concentration of assessment of an organization’s performance, management oxygen atoms covalently bonded to a single carbon atom. air pollutants in engine exhaust gauges. systems and processes. It is a gas at standard temperature and pressure, and it exists in Earth’s atmosphere in this state, as a trace gas at a Footprint Available Lower Berth (ALB) concentration of 0.39 percent by volume. The amount of environmental impact related to a specific Guest beds available on a cruise ship, assuming two people resource. occupy a stateroom. CO2e (Carbon Dioxide Equivalent) A measure used to compare the emissions from various Global Reporting Initiative (GRI) Ballast Water greenhouse gases based on their global warming A network-based organization that produces a Seawater that is taken on board a ship and stored in tanks potential (GWP). The CO2 equivalent for a gas is derived by comprehensive sustainability reporting framework that to control draft, list, trim and stability. multiplying the tonnes of the gas by the associated GWP. is widely used around the world. GRI is committed to the framework’s continuous improvement and application Bilge Water Direct Emissions (Scope 1 Emissions) worldwide. GRI’s core goals include the mainstreaming Water from equipment maintenance and minor leaks that Emissions from sources that are owned or controlled by of disclosure on environmental, social and governance collects in the lowest part of the ship. the reporting organization. For example, direct emissions performance. related to combustion would arise from burning fuel for Bionomics energy within the reporting organization’s boundaries. Global Warming Potential (GWP) The science of the relationships between organisms and A relative measure of how much heat a greenhouse gas their environments. Energy Saved traps in the atmosphere. It compares the amount of heat The reduced amount of energy needed to carry out the trapped by a certain mass of the gas in question to the Black Water same processes or tasks. The term does not include amount of heat trapped by a similar mass of carbon dioxide. Wastewater from toilets, urinals and medical sinks. overall reduction in energy consumption from reduced A GWP is calculated over a specific time interval, commonly organizational activities. 20, 100 or 500 years. Bunkered Water Potable water that is purchased from a municipal or private Environmental Aspect Governance system at a port and stored on board in tanks. Element of Company activities that may have a significant The set of rules (laws and corporate regulations), impact on the environment directly and/or indirectly. organizational structures, processes and relationships that CFC-11 Equivalent affect the way a company is directed and administered. The A measure used to compare various substances based on Environmental Impact concept of governance also embraces the structure used to their relative ozone depletion potential. The reference level How an environmental aspect may affect the environment. decide corporate objectives and the means to achieve and of 1 is the potential of CFC-11 and CFC-12 to cause ozone measure results. depletion. Environmental Management System (EMS) An EMS refers to the management of an organization’s Gray Water Chlorofluorocarbons (CFCs) environmental programs in a comprehensive, systematic, Wastewater that is generated from activities such as Commonly known by the trade name “freon,” used primarily planned and documented manner. It includes the laundry, bathing, cooking and dishwashing. as a refrigerant in air-conditioning and refrigeration systems organizational structure, planning and resources for and equipment. CFCs are known to have destructive effects developing, implementing and maintaining policy for on the ozone layer. For this reason their use has now been environmental protection. banned by legislation.

Table of Contents 27 Glossary - continued

Greenhouse Gas (GHG) Indirect Emissions (Scope 2 Emissions) International Labour Organization (ILO) A gas in the atmosphere that absorbs and emits radiation Emissions that result from the activities of the reporting The United Nations agency that seeks the promotion of within the thermal infrared range. This process is the organization but that are generated at sources owned social justice and internationally recognized human and fundamental cause of the greenhouse effect, which many or controlled by another organization. In the context of labor rights. believe is the cause of global warming. The primary this indicator, indirect emissions refer to greenhouse greenhouse gases in the Earth’s atmosphere are water gas emissions from the generation of electricity, heat or International Maritime Organization (IMO) vapor, carbon dioxide, methane, nitrous oxide and ozone. steam that is imported and consumed by the reporting The United Nations agency responsible for improving Greenhouse gases greatly affect the temperature of the organization. maritime safety and preventing pollution from ships. Earth; without them, Earth’s surface would be on average about 33 degrees C (59 degrees F) colder than at present. Indirect Energy International Organization for Standardization (ISO) The greenhouse gases thought to be major contributors Energy produced outside the reporting organization’s An international standard-setting body composed to global warming are carbon dioxide (CO2), methane and boundary that is consumed to supply energy for the of representatives from various national standards biomethane emissions (CH4), nitrogen oxide (N2O) and organization’s energy needs (e.g., electricity, or for heating organizations. An ISO Standard is an international chlorofluorocarbons (CFC). and cooling). The most common example is fuel consumed specification that establishes a common framework of outside the reporting organization’s boundary in order to reference or a common technical language between Greenhouse Gas (GHG) Protocol Initiative generate electricity to be used inside the organization’s suppliers and customers, thus facilitating trade and the The Greenhouse Gas Protocol Initiative’s vision is to boundary. transfer of technology. harmonize greenhouse gas emission accounting and reporting standards internationally. It aims to provide Injury Severity Levels International Safety Management (ISM) Code a multi-stakeholder framework ensuring that different Work-related crew member and contractor injuries are International code for the safe management and operation trading schemes and other climate-related initiatives adopt classified as major, serious or minor, based on the following of ships and for pollution prevention. consistent approaches to GHG accounting. criteria: • Major injury: Any fracture, loss of any body part, loss ISO 14001 Heating, Ventilation and Air-Conditioning (HVAC) of vision (temporary or permanent), dislocation of a Global standards for the Environmental Management System joint or a ruptured ligament or tendon, hypothermia or System developed by the ISO. The technology used for indoor environmental climate hyperthermia secondary to environmental exposure that control. requires medical treatment, an injury resulting in trauma International Ship and Port Security (ISPS) Code that requires advanced life support or any other injury A part of SOLAS that prescribes responsibilities of Heavy Fuel Oil (HFO) requiring hospitalization on board or on shore for more governments, shipping companies, shipboard personnel and A type of blended oil used in ships’ engines, made from than 24 hours following the injury. port/facility personnel to “detect security threats and take the residues from various refinery distillation and cracking preventative measures against security incidents affecting processes. • Serious injury: Any injury, other than a major injury, ships or port facilities used in international trade.” which results in time off work for more than three Indicator consecutive days following the injury or that results in Liquefied Natural Gas (LNG) A means used to measure the effects of sustainability disembarkation without return on board. Liquefied natural gas or LNG is natural gas (predominantly management initiatives or the condition of environmental, • Minor injury: Any injury that is not a serious or major methane, CH4) that has been converted to liquid form for social or governance issues. injury and that results in time off work of 24 hours or ease of storage or transport. more following the injury.

Table of Contents 28 Glossary - continued

Marine Sanitation Devices (MSD) Primary Source Significant Spills A system that employs filtration, maceration and The initial form of energy consumed to satisfy the A significant spill is defined as a spill for which the chlorination technologies to treat black water. reporting organization’s energy demand. This energy is monetary sanctions are $100,000 or greater and which is used either to provide final energy services (e.g., space reportable in the Annual Report on Form 10-K. Maritime Labour Convention 2006 (MLC 2006) heating, transport) or to produce intermediate forms of Solid Waste An international treaty that provides comprehensive rights energy, such as electricity and heat. All used and discarded solid material produced on board and protection at work for the world’s seafarers. The during ship operations. convention sets out seafarers’ rights to decent conditions Protected Area of work on a wide range of subjects and aims to be globally A geographically defined area that is designated, regulated SOx applicable, easily understandable, readily updatable and or managed to achieve specific conservation objectives. Oxides of sulfur are a family of gases produced by the uniformly enforced. combustion of fuel which contains sulfur. The quantity of Refrigerants oxides of sulfur is proportional to the quantity of sulfur in MARPOL Gases that are used in HVAC systems on board. the fuel. The International Convention for the Prevention of Pollution from Ships. MARPOL was designed to minimize pollution of Renewable Energy Stakeholder the seas. Renewable energy is derived from natural processes Any individual or group, within or outside a company, that are replenished constantly. This includes electricity that has an interest in or may be impacted by that Metric Tonne and heat generated from solar, wind, ocean currents, company and that, accordingly, has expectations, requires 1 metric tonne = 2,204.62 pounds (lbs.) = 1,000 kilograms. hydropower, biomass, geothermal resources or biofuels, information or holds legitimate economic interests. as well as hydrogen derived from renewable resources. NOx STCW Oxides of nitrogen that are a family of gases released from Safety Management System (SMS) The International Convention on Standards of Training, the combustion of fuel. ISM code-certified system that informs employees how Certification and Watchkeeping for Seafarers, which sets to perform their duties in accordance with all safety and qualification standards for masters, officers and watch Ozone-depleting Potential (ODP) environmental laws. personnel on seagoing merchant ships. The relative potential of various gases to deplete the ozone in the atmosphere. Safety of Life at Sea (SOLAS) Convention Total Water Withdrawal The most important and comprehensive international The sum of all water drawn into the boundaries of the Ozone-depleting Substance (ODS) treaty governing the safety of merchant ships. reporting organization from all sources (including surface Any substance with an ozone depletion potential greater water, ground water, rainwater and municipal water than zero that can deplete the stratospheric ozone layer. Significant Air Emissions supply) for any use over the course of the reporting period. Most ozone-depleting substances are regulated under the Air emissions that are regulated under international Montréal Protocol and its amendments and include CFCs, conventions and/or national laws or regulations, including Turnover HCFCs, halons and methyl bromide. those listed on environmental permits for the reporting The ratio of the number of terminations to the average organization’s operations. employee count during the reporting period.

Table of Contents 29 gri table

General Standard Disclosures

102-1 Name of the organization Ý Introduction 102-2 Activities, brands, products, and services Ý Introduction 102-3 Location of headquarters Ý Sydney, New South Wales 102-4 Location of operations Ý Plan a cruise 102-5 Ownership and legal form Ý Introduction; Carnival Corporation & plc 2017 Annual Sustainability Report (page 19) 102-6 Markets served Ý About 102-7 Scale of the organization Ý Performance Summary — Social; Carnival Corporation & plc 2017 Annual Sustainability Report (page 19) 102-8 Information on employees and other workers Ý Employees; Performance Summary — Social 102-9 Supply chain Ý Community; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 30–35, 38–43, 78–80, 98–101) 102-10 Significant changes to the organization and its supply chain Ý Introduction; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 20-22) 102-11 Precautionary Principle or approach Ý Report Parameters; Carnival Corporation & plc 2017 Annual Sustainability Report (page 38–40) 102-12 External initiatives Ý Regulatory Landscape; Safety, Security & Health; Environment; Employees; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 34, 126–140)

102-13 Membership of associations Ý Carnival Corporation & plc 2017 Annual Sustainability Report (pages 145–147) 102-14 Statement from senior decision-maker Ý Message from the President 102-15 Key impacts, risks, and opportunities Ý Introduction; Regulatory Landscape; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 38–43) 102-16 Values, principles, standards, and norms of behavior Ý Introduction; Community: Supply Chain; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 30–35, 98–101)

102-18 Governance structure Ý Carnival Corporation & plc Corporate Governance; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 30–35) 102-40 List of stakeholder groups Ý Carnival Corporation & plc 2017 Annual Sustainability Report (page 116) 102-41 Collective bargaining agreements Ý Performance Summary - social shipboard 102-42 Identifying and selecting stakeholders Ý Carnival Corporation & plc 2017 Annual Sustainability Report (page 116)

102-43 Approach to stakeholder engagement Ý Carnival Corporation & plc 2017 Annual Sustainability Report (page 116) 102-44 Key topics and concerns raised Ý Carnival Corporation & plc 2017 Annual Sustainability Report (page 116) 102-45 Entities included in the consolidated financial statements Ý Carnival Corporation & plc 2017 10K 102-46 Defining report content and topic Boundaries Ý Report Parameters; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 12–13, 116–119) 102-47 List of material topics Ý Report Parameters; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 116-119) 102-48 Restatements of information Ý Report Parameters; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 116-119) 102-49 Changes in reporting Ý Report Parameters; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 116-119) 102-50 Reporting period Ý FY2017 (December 1, 2016–November 30, 2017) 102-51 Date of most recent report Ý Report Parameters; FY2009 102-52 Reporting cycle Ý Biennial 102-53 Contact point for questions regarding the report Ý [email protected] 102-54 Claims of reporting in accordance with the GRI Standards Ý Core 102-55 GRI content index Ý GRI Standards KEY 102-56 External assurance Ý Carnival Corporation & plc 2017 Annual Sustainability Report (pages 142–143) Ý = Full = Partial

Table of Contents 30 gri table - continued

Management Approach

103-1 Explanation of the material topic and its Boundary Ý Report Parameters; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 116–119) 103-2 The management approach and its components Ý Report Parameters, Environment: Management System, Safety, Security & Health: Management System; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 14–15, 18–35, 38–43, 56–106, 109, 126–140)

103-3 Evaluation of the management approach Ý Report Parameters; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 14–15, 18–35, 38–43, 56–106, 109, 126–140)

Economic Performance

201-1 Direct economic value generated and distributed Ý Carnival Corporation & plc 2017 10K Carnival Corporation & plc 2017 Annual Sustainability Report (pages 18–29, 88–97) 201-2 Financial implications and other risks and opportunities Safety, Security & Health: Management System; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 38–43) due to climate change

203-1 Infrastructure investments and services supported Ý Community; Carnival Corporation & plc 2017 Annual Sustainability Report (pages 88–97) 203-2 Significant indirect economic impacts Ý Community; Environment; Carnival Corporation & plc 2016 Annual Sustainability Report (pages 66–71)

Environmental Performance

Energy

302-1 Energy consumption within the organization Ý Environment: Energy & Emissions; Performance Summary — Environmental 302-2 Energy consumption outside of the organization Ý Environment: Energy & Emissions; Performance Summary — Environmental 302-3 Energy intensity Ý Environment: Energy & Emissions; Performance Summary — Environmental 302-4 Reduction of energy consumption Ý Environment: Energy & Emissions; Performance Summary — Environmental 302-5 Reductions in energy requirements of products and services Ý Environment: Energy & Emissions; Performance Summary — Environmental Water

303-1 Water withdrawal by source Ý Environment: Water; Performance Summary — Environmental 303-2 Water sources significantly affected by withdrawal of water Ý Environment: Water; Performance Summary — Environmental Biodiversity

304-1 Operational sites owned, leased, managed in, or adjacent to, Ý Community: Giving and Volunteerism; Environment: Biodiversity protected areas and areas of high biodiversity value outside protected areas

304-2 Significant impacts of activities, products, and services Ý Community: Giving and Volunteerism; Environment: Biodiversity on biodiversity 304-3 Habitats protected or restored Community: Giving and Volunteerism; Environment: Biodiversity Emissions

305-1 Direct (Scope 1) GHG emissions Ý Environment: Energy & Emissions; Performance Summary — Environmental 305-2 Energy indirect (Scope 2) GHG emissions Ý Environment: Energy & Emissions; Performance Summary — Environmental 305-3 Other indirect (Scope 3) GHG emissions Ý Environment: Energy & Emissions; Performance Summary — Environmental 305-4 GHG emissions intensity Environment: Energy & Emissions; Performance Summary — Environmental Ý KEY 305-5 Reduction of GHG emissions Ý Environment: Energy & Emissions; Performance Summary — Environmental Ý = Full 305-6 Emissions of ozone-depleting substances (ODS) Ý Environment: Energy & Emissions; Performance Summary — Environmental = Partial 305-7 Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions Ý Environment: Energy & Emissions; Performance Summary — Environmental

Table of Contents 31 gri table - continued

Environmental Performance - Continued

Effluents and Waste

306-1 Water discharge by quality and destination Ý Environment: Water; Performance Summary — Environmental 306-2 Waste by type and disposal method Ý Environment: Solid Waste; Performance Summary — Environmental 306-3 Significant spills Ý Environment: Accidental Releases; Performance Summary — Environmental Environmental Compliance

307-1 Non-compliance with environmental laws and regulations Ý Introduction

Social Performance

Employment

401-1 New employee hires and employee turnover Ý Employees: Retention; Performance Summary — Social Labor/Management Relations

402-1 Minimum notice periods regarding operational changes Ý Employees: Labor Relations & Fair Employment Occupational Health and Safety 403-1 Workers representation in formal joint management–worker health and safety committees Safety, Security & Health: Employee Training; Performance Summary — Social 403-2 Types of injury and rates of injury, occupational diseases, lost days, and absenteeism, and Safety, Security & Health: Employee Training; Performance Summary — Social number of work-related fatalities Training and Education

404-1 Average hours of training per year per employee Ý Employees: Training & Development; Performance Summary — Social 404-2 Programs for upgrading employee skills and transition assistance programs Ý Employees: Training & Development 404-3 Percentage of employees receiving regular performance and career development reviews Ý Employees: Recruitment & Retention Non-Discrimination

406-1 Incidents of discrimination and corrective actions taken Ý Employees: Ethics Freedom of Association and Collective Bargaining 407-1 Operations and suppliers in which the right to freedom of association and collective Employees: Labor Relations & Fair Employment; Performance Summary — Social; Carnival bargaining may be at risk Corporation & plc 2017 Annual Sustainability Report (pages 98–101, 114–115) Child Labor 408-1 Operations and suppliers at significant risk for incidents of child labor Community: Supply Chain Forced or Compulsory Labor 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labor Community: Supply Chain Security Practices

410-1 Security personnel trained in human rights policies or procedures Ý Safety, Security & Health: Security

KEY

Ý = Full = Partial

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Social Performance - Continued

Human Rights Assessment

412-2 Employee training on human rights policies or procedures Ý Employees: Ethics Local Communities 413-1 Operations with local community engagement, impact assessments, and development programs Community Anti-corruption

205-2 Communication and training about anti-corruption policies and procedures Ý Employees: Training & Development 205-3 Confirmed incidents of corruption and actions taken Ý Employees: Ethics Customer Health and Safety

416-1 Assessment of the health and safety impacts of product and service categories Ý Carnival Corporation & plc 2017 Annual Sustainability Report (pages 44-55) Customer Privacy 418-1 Substantiated complaints concerning breaches of customer privacy and losses of customer data Safety, Security & Health: Security; Carnival Corporation & plc 2017 Annual Sustainability KEY Report (pages 106-109) Ý = Full Socioeconomic Compliance = Partial 419-1 Non-compliance with laws and regulations in the social and economic area Carnival Corporation & plc 2017 Annual Sustainability Report (page 31)

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