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NIELSEN NON-FINANCIAL MATERIALITY ASSESSMENT

UPDATED RESPONSIBILITY & SUSTAINABILITY NON-FINANCIAL MATERIALITY ASSESSMENT HIGHLIGHTS NIELSEN’S COMMITMENT TO PROACTIVE ENGAGEMENT WITH ITS STAKEHOLDERS

Non Financial Materiality Assessment

Executive Summary

As part of our commitment to meaningful continuous improvement across our business, we have engaged our stakeholders within and beyond Nielsen to create our third non-financial materiality assessment. These opportunities to proactively listen to our stakeholders are key to our strategic and evolving understanding of Nielsen’s ability to directly and indirectly create value through our business and in our communities, today and into the future; we’re committed to incorporating their feedback into our overall processes, business strategy, and global responsibility and sustainability programs. Beyond seeking to better understand how stakeholders view Nielsen today, we also use this feedback to identify future potential risks and opportunities, including any emerging issues that could affect Nielsen’s business success and stakeholder relationships. In order to conduct this assessment, we engaged stakeholders directly or through proxies across all aspects of our value chain.

The results of this assessment inform our strategic approach in a variety of ways: our ongoing communications about Nielsen’s overall commitments; how we proactively respond to environmental, social and governance (ESG)-related inquiries from investors, clients, and other stakeholders; and how we allocate resources to areas of greatest impact and importance to Nielsen. These issues cut across all aspects of our business, operations, and value creation through our client and industry relationships, our employee base, and our communities.

The issue areas highlighted through this materiality assessment are naturally interconnected with the ESG issues that matter most to our business, such as our commitment to employee engagement and development; diversity across our workforce and approach to measurement; Nielsen Cares projects that leverage our data and associates’ talents to make a social impact; our work to ensure our suppliers operate sustainably; and our commitment to helping our clients embed sustainability into their product and consumer engagement strategies. Through responsible, sustainable business practices, we’re committed to connecting key ESG best practices with our core purpose as a company to deliver greater value for all of our stakeholders. The responsibility to deliver on our key ESG commitments, aligned with the material priority areas identified in this assessment, is shared by all of our functional teams and leaders across our global business.

We collected stakeholder feedback over the course of this assessment through in-depth interviews and focus groups, as well as reviews of existing documentation; web commentary; surveys; feedback from ESG standards-setters, raters and rankers; social and traditional media content; and webinars. Our key stakeholder groups include, but are not limited to: employees, clients, industry trade groups and influencers, regulators and policymakers, community organizations and nonprofits, investors, suppliers, and strategic business partners. We sought to balance internal and external input across multiple geographies. Feedback was documented, and our internal team and outside experts identified hundreds of relevant topic areas. These issues were then ranked, with consideration given to factors including intensity, frequency of mentions across stakeholder groups, and relative impact on stakeholders, society and our business. Prioritization was given to areas where Nielsen could most uniquely or directly act to address areas of interest to stakeholders and of importance to our business.

We’ve linked our ESG strategy and external reporting efforts as part of a cohesive cycle focused on continuous improvement, enabling us to transparently share our ongoing journey through our Nielsen Global Responsibility Report and regular updates. Our next Nielsen Global Responsibility Report, planned for publication in 2020, will cover each of these material topic areas in greater depth. We will continue to publish regular updates on these and other priorities via Nielsen News Center and other outlets.

Our Strategic Approach

As with our previous two assessments, we intend to use this information to guide both how we prioritize and resource continuous improvement efforts, and how we publicly report on these ongoing initiatives. This is our third non-financial materiality assessment; the most recent previous assessment was published in 2017. Going forward, we are committed to continuing this practice of conducting these assessments on a periodic basis.

We’ve decided to use a new visual format to distill our priority issue areas for this assessment, as we feel this more appropriately conveys the overlapping and dynamic interactions among our most material issue areas. Rather than the traditional horizontal/vertical axes we’ve used in previous years, we chose instead to use a Venn diagram format to show how these key strategic areas are inherently interconnected and interdependent. Much has changed in our business and operating environment since we published our last assessment in 2017. Shifting market and industry dynamics, increased pressure on our clients’ business models, new and emerging data privacy regulations, and the rapid pace of technological innovation are some of the key factors that we’ve highlighted with our stakeholders as forces of change for our business. While change creates opportunities for evolution, we also recognize the enduring importance of foundational elements of our brand—integrity, trust, transparency, and quality data representative of all consumer populations—aligned with the key areas that came out of this most recent assessment.  

Although this graphic does not include the traditional axes of “importance to stakeholders” and “importance to society,” we have applied these fundamental considerations to our analysis and issue prioritization per the Global Reporting Initiative (GRI) Sustainability Reporting Standards. Each issue area contains a myriad of nuanced topics that were specifically cited by our stakeholders, which we recognize as critical for Nielsen to monitor and lead on as we seek to create economic, social and environmental value within and beyond our business, both today and over the long term. We have included definitions for each issue area below to reflect our stakeholders’ feedback and to clarify their unique meaning in the context of our business.

While the most material topic areas highlighted in this narrative are those that ranked highest among the hundreds of inputs we received from our stakeholders, all should be considered important. Topics at the center of the diagram—“Data,” “Trust,” “Transparency,” and “Diversity & Inclusion”—were recognized across stakeholder groups as the foundation on which all of the other issues are based.

At the center, “Data” was most prominently and frequently cited by all stakeholder groups. Data is at the core of our business, and it is fundamental to how we create value across all the other issue areas. Given the nature of our business across more than 90 years, the central importance of data is no surprise. The data we collect, analyze and share with the clients and industries we support each day is the lifeblood of our business. Our clients expect our data to be unbiased, accurate, trustworthy, and collected according to the highest standards of privacy, security, and integrity so they can rely on our insights for their important business decisions. Our shareholders expect us to continue to adapt our use of innovative new technology to the rapidly-changing end-markets in which we work. Our data must also represent all consumers, and we are similarly focused on ensuring that our own workforce represents the communities we seek to measure in order to harness the power of diversity to drive better business outcomes. We also recognize the unique opportunity for data to help communities and nonprofits more effectively deliver on their missions; we seek to contribute to these efforts through our Data for Good initiatives.  

For many of our stakeholders, certain topics are seen as fundamental “table stakes” for any successful, sustainable company to operate responsibly. For Nielsen, these include, but are not limited to:

  • Sustaining our economic performance and growth over the long-term;
  • Addressing climate change-related issues that impact our global footprint;
  • Mitigating any negative ethical, social or environmental impacts that flow through our end-to-end business and supply chain; and
  • Engaging with our communities, particularly through employee volunteerism and in-kind giving of our unique insights through Data for Good projects that make a positive social impact.

Key Issue Areas Defined

Our Venn diagram format shows how all of our material topics are complementary and interdependent. For example, we build and maintain trust in our data by acting with integrity, complying with regulations, and communicating transparently with our stakeholders. Diversity and inclusion support our drive for talent retention, attraction, and engagement, which ultimately helps our business model continually evolve to reflect all consumers across geographies and cultures. Transparency gives our clients and shareholders confidence that our business model (and the data we deliver) is sound and that we are compliant with current and emerging regulations that affect our data collection and use. Given the inherent interconnections among these priority areas, they all are equally important and essential to our future growth.

As illustrated through our graphic, our stakeholders helped us identify the following priority non-financial material topic areas:

Data

For close to a century, Nielsen has provided data and analytics based on scientific rigor and cutting-edge innovation, continually developing new ways to answer the most important questions facing the media, advertising, retail and fast-moving consumer goods industries. Since data powers Nielsen’s business, it must be of the highest quality: consistent, reliable, and representative of all consumers and channels. The business of data creates responsibilities—a responsibility to protect the consumer, a responsibility to protect the marketing ecosystem, and a responsibility to manage it all with integrity and transparency.

Clients, in particular, expressed interest in how Nielsen ensures that the consumers who provide information to us are representative of a broad range of perspectives, with a special focus on multicultural consumers. On the analytics side, they expect transparency on how we confirm that our insights are unbiased, and that consumers’ privacy is protected through our approach to privacy by design. All stakeholder groups emphasized the importance of protecting the confidentiality of the data and information we collect, and utilizing the latest technology and practices to secure it. We will continue to invest in wide-ranging data privacy, security and integrity safeguards to ensure quality and security are never compromised.

Additionally, stakeholders across the board see continued opportunities for Nielsen’s data to be used for societal and environmental good. To deliver on this, we plan to continue to focus on Data for Good projects where we can make a unique impact through our data, insights, and capabilities, as part of our $10 million annual commitment to pro bono work and our overarching Nielsen Cares volunteer platform.

We believe that our commitment to high-quality, science-backed data is an essential service to the marketplace. The ability to provide useful data, independent of bias towards buyer or seller, will only become more crucial. We also anticipate our ability to make a positive social impact will grow as we continue to work with key nonprofits across our priority cause areas.

Trust

Our mission is to provide the most complete and trusted view available of consumers and markets worldwide. For consumers to willingly share information with us, they have to trust us. We take seriously our commitment to keep all personal and confidential data private.

Trust underpins all that we do at Nielsen and remains critical to our social license to operate, particularly as changing consumer expectations and regulatory environments impact all companies’ ability to collect, use, and sell consumer information. The foundation of trust that we’ve built and must maintain across our operations, products, and people remains a key competitive differentiator. We recognize the critical role we play for our clients to ensure that the data we deliver to them is representative, accurate, and useful for their own predictive analyses as they use our insights to direct their resources and shape markets for advertising, consumer goods, media and more.

As it is critical to providing independent measurement services for the industries we support, trust is also a key aspect of our talent engagement and retention strategy. Our employees are especially interested in the future evolution of our business as it aligns with their own unique opportunities for career growth. We’re committed to openly sharing new opportunities for learning and development as we seek new ways for our associates to be engaged and grow in their careers alongside our company’s continued evolution.

Transparency

Transparency is key to our ability to showcase the differentiating value of our data, and to share our progress on how we innovate to better meet the imperatives of our world today by connecting with existing and new clients, entering new measurement channels and evolving into a new phase of Nielsen’s overall growth. Specifically, stakeholders expect continued transparency around data collection methodologies and analysis, strategy and future plans, financial reporting, leadership changes and ambitions, and diversity representation. Employees, too, want to continue to be engaged in our long-term growth plans and the resulting opportunities for career development.

Media buyers and advertisers need transparency in order to effectively negotiate and trade in an open marketplace. In using rigorous, independent measurement that provides a source of truth, they want to understand just how effective their efforts are and how they can improve upon them. More clarity ultimately means more trust that they are getting exactly what they paid for. The consumers who provide this data—with every click, every like, and every transaction—also want to know that they are protected. Consumers are more aware and concerned about how data about them is being captured and used today than ever before.

Our success is dependent on stakeholders’ confidence that our data, business practices, forecasting, and financial reporting are unimpeachable. Our business practices, professional behavior, approach to corporate governance, codes of conduct, Global Responsibility Report, public filings, Insights and News Center, are all a part of our focus on transparency toward our commitment to build and maintain trust across all of our stakeholder groups.

Diversity & Inclusion

Diversity & Inclusion remains critical to our business, in terms of our ability to include all consumers across our measurement solutions, to ensure that our workforce represents the changing demographics around the world, and to enable all associates to perform to their full potential. As artificial intelligence and machine learning evolve and present new use cases for measurement, we recognize the importance of ensuring that these tools are used in a responsible way that is representative of all consumers.

The importance of nurturing a diverse and inclusive workplace touches every aspect of Nielsen’s business. A diverse talent pool creates a more productive environment with a broad range of thoughts and experiences that spurs innovation. Clients expect Nielsen to consistently evolve and deliver to provide new insights about multicultural consumers, audiences and media. We can’t effectively measure these audiences without ensuring that our own workforce also reflects a diversity of viewpoints, backgrounds, and life experiences. Outreach to diverse communities also gives us access to new talent pools and a deeper understanding of multicultural communities as we expand our consumer panels.

We also expect all of our suppliers and business partners to embody a multicultural approach and reflect the world we seek to measure.

Beyond our own value chain, our recent public position opposing the proposed citizenship question in the 2020 U.S. Census was cited by various stakeholder groups as a welcome example of leadership in support of upholding strong data science principles and representing diverse populations.

Business Model Evolution & Innovation

Business Model Evolution & Innovation reflects the importance of continuing to evolve our approach to measurement and the ways that we deliver our data and services across the industries and clients we support. Our data helps clients around the world understand what’s happening now and what’s happening next; to that end, our measurement capabilities and technology must innovate to stay ahead of the rapid pace of change all companies and industries are experiencing today.

We also must provide a view of the total market and measure all channels through which consumers purchase goods and consume media. As this ecosystem continues to rapidly evolve and grow, Nielsen’s position as an independent provider of data that is consistent and comparable will only grow more important. We are committed to continuously improving our technology and expanding our measurement capabilities through constant innovation with a spirit of open, nimble collaboration and with a focus on the velocity that will help our clients and industries achieve shared goals.

Clients and investors are focused on opportunities for Nielsen to stay ahead of the curve through innovation on the cost-side of our business by growing more efficient and developing streamlined ways to collect and synthesize data in an increasingly complex world. Innovation is key to our ability to succeed, and we recognize the importance of protecting our innovations and intellectual property across our entire footprint. Protecting innovation by promptly seeking patent protection on both the revenue-generating side of the business through new products and services and the cost-side of our business through efficiency-generating processes will remain a hallmark of Nielsen’s innovation strategy.

Nielsen’s innovation imperative encompasses the need to leverage artificial intelligence and machine learning to grow our measurement capabilities in new ways, how we engage with our clients, and how we ensure that all channels, categories and consumers are reflected in our coverage. To more seamlessly deliver for our clients and the industries we support, we’ve simplified our organization into two core platforms: Nielsen Global Media and Nielsen Global Connect.

Our focus on innovation also includes opening up to new clients and new end-users of Nielsen data and services as we become more product- and technology-focused as a company. One of these new opportunities is a focus on the sustainability related intelligence we can provide our clients, particularly in the consumer packaged goods and retail spaces.

Talent Engagement

Nielsen’s future relies on a skilled and stable talent pool. Ensuring that all Nielsen associates feel engaged and supported throughout their career journeys—regardless of race, gender, background or any of the other factors covered by our global non-discrimination statement—remains critical to our ability to attract, maintain, and grow top talent at our company in order to create and deliver better solutions to the marketplace.

As it is especially critical that our employees remain engaged throughout their time at Nielsen, in recent years we’ve invested in growing employee engagement in new ways across a variety of different dimensions, such as regular employee engagement “pulse checks,” encouraging associates and their managers to connect through regular check-ins, and expanding the capacity of our internal mentoring and leadership development programs. Employee engagement is the emotional and psychological connection our associates feel about their workplace and the work that we do. It’s about belonging, commitment, growth, and teamwork. And ultimately, it helps lead to both individual and business success.

Current employees indicated that they value job security, a culture that supports diversity, and transparency around future career growth and promotion opportunities. Associates cited continued, ongoing training and leadership development opportunities as key ways to retain and engage employees.

At Nielsen, our talent strategy aligns directly with our long-term business strategy. That is, our focus on innovation, technology, and efficiency—and the associated transformation of our organization to continue to deliver on our purpose to help our clients and the markets we serve to operate more efficiently—drives our talent development and strategic workforce planning.

Compliance & Integrity

Compliance & Integrity complements our cross-cutting focus on trust and transparency. This includes our internal engagement with employees on the need to protect Nielsen’s brand and reputation; the way we engage with our panelists and the consumers we measure; the protections we maintain in our relationships with third-party partners and suppliers; and the end-deliverables we share with our clients. Integrity encompasses good governance, regulatory compliance, and responsible business practices.

As an independent data and measurement company, our clients—and the industries we support—depend on us to be an unbiased arbiter. To serve as a source of truth, integrity must be part of the foundation of all that we do at Nielsen. Maintaining such a culture helps protect the integrity of our data across the clients and markets we serve around the globe, builds a better workplace where employees feel respected and engaged, and increases our stakeholders’ trust in our business and brand. This connection between a strong culture of integrity and increased trust has been critical to our ability to foster a supportive work environment, effectively engage with consumers, provide cutting-edge measurement services, and ultimately to help our clients and markets grow.

The compliance landscape is becoming more complex with the evolution of data privacy, cybersecurity disclosure requirements, and regulations around the globe. We will continue to invest in these important areas to ensure we meet and exceed these requirements.