Exhibit 99.1 2022 SUSTAINABILITY REPORT Making a Premier Impact
TABLE OF CONTENTS LETTER FROM OUR PRESIDENT AND CEO 3 OVERVIEW 4 ABOUT US 5 OUR APPROACH TO SUSTAINABILITY 6 ABOUT THIS REPORT 9 2022 ESG HIGHLIGHTS 10 2022 AWARDS AND RECOGNITION 11 ETHICS AND COMPLIANCE 12 ETHICS AND COMPLIANCE 13 ENTERPRISE RISK MANAGEMENT AND BUSINESS CONTINUITY 14 CYBER RISK MANAGEMENT, DATA SECURITY AND CUSTOMER PRIVACY 15 GOVERNMENT AFFAIRS AND ADVOCACY 17 OUR PEOPLE AND CULTURE 18 OUR PEOPLE FIRST PHILOSOPHY 19 RECRUITMENT, ENGAGEMENT AND RETENTION 20 TALENT DEVELOPMENT 21 DIVERSITY, EQUITY, INCLUSION AND BELONGING 22 EMPLOYEE HEALTH AND SAFETY 24 IMPROVING COMMUNITY HEALTH 25 IMPROVING PATIENT OUTCOMES COST-EFFECTIVELY 26 HEALTH EQUITY PLANNING INITIATIVE AND COLLABORATIVE 26 SUPPORTING THE MEDICALLY UNDERSERVED 27 IMPROVING HEALTH THROUGH COMMUNITY DEVELOPMENT 27 RESPONSIBLE SUPPLY CHAIN 30 SUPPLY CHAIN SERVICES 31 ETHICS AND COMPLIANCE 32 PRODUCT QUALITY AND SAFETY 32 SUPPLY CHAIN ENVIRONMENTAL CONSIDERATIONS 34 SUPPLIER DIVERSITY 35 SUPPLIER RESILIENCY AND DISASTER RESPONSE 36 FORWARD-LOOKING STATEMENTS ENVIRONMENTAL MANAGEMENT 37 This report contains forward-looking statements that are based on Premier’s current expectations and beliefs. All statements, other than statements of historical MANAGING OUR CLIMATE IMPACT 38 fact, are statements that could be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward- looking statements involve known and unknown risks, uncertainties, and other factors that may be out of the company’s control and could cause actual results to APPENDIX 41 ESG DATA TABLE 42 differ materially from future results expressed or implied by those statements. Premier disclaims any intention or obligation to update or revise forward-looking SUSTAINABILITY ACCOUNTING STANDARDS BOARD (SASB) 44 statements, whether as a result of new information, future events or otherwise. U.N. SUSTAINABLE DEVELOPMENT GOALS (SDGS) 49 ESG MATERIALITY ASSESSMENT DEFINITIONS 50 All metrics in this report are based on internal company data and estimates unless otherwise noted. 2
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management a materiality assessment to better understand the ESG actions that encourage our teams to think bigger and We continue to strengthen our risk management and factors that our stakeholders believe are most relevant work as diverse teams to solve complex challenges, data privacy programs. Overseen directly by our Board, to our business success and value creation. The analysis execute with excellence and ardently self-manage our risk management and data security programs are helped identify the ESG topics that we believe require performance. In addition, we scaled our commitment guided by a robust plan designed to minimize disruptions greater resources and measurement to ensure that we to diversity by partnering with 27 health system and ensure privacy protection in the event of a natural are accountable for advancing our sustainability members in a new supplier diversity pledge, committing disaster, cyber attack or other emergency. Key business practices. In addition, Premier’s Board of Directors made to measure and aggressively improve purchasing continuity and infrastructure recovery capabilities are the decision to include certain ESG measures as part of through diverse companies. validated through security drills, third-party audits, our annual incentive compensation plan – linking cyber maturity assessments and mock event drills progress on core ESG goals to all employees’ Premier is committed to sourcing safe, effective, that are run at least annually to ensure changing with potential compensation. high-quality products. Premier works hard to offer our the current risk environment. members a broad array of environmentally friendly LETTER FROM What follows are highlights of the numerous ways ESG products. As part of that commitment, Premier collects Building on a solid foundation, we made good progress in practices guide us in our newly defined priority areas, a host of data points to help members pinpoint and 2022, and we know we have much more to do. We are OUR PRESIDENT how they are embedded in our business and enable us avoid products that may contain potentially harmful fully committed to further embedding ESG practices into to create value by better supporting our members and chemicals or other environmentally damaging our business practices to transform healthcare and make AND CEO other stakeholders, including the communities we serve. components. In addition, we vet suppliers' safety and the world a better place. On behalf of Premier’s 2,600 employees and our Board regulatory compliance records and product performance of Directors, I am delighted to present Premier’s 2022 Integrity and business ethics are fundamental to as part of our bid process. For products we directly Sincerely, Sustainability Report. Premier. Our Board sets exacting standards for our source, we deploy a rigorous quality and inspection employees, contractors, suppliers, members and program that leverages industry best practices to deliver Environmental, social and governance (ESG) practices directors based upon our philosophy regarding the safe and effective, high-quality products, all while driving are core to who we are as a company and interwoven importance of sound corporate governance. Named tangible savings. Michael J. Alkire ® with our mission to improve the health of communities. as one of the World’s Most Ethical Companies by the President and CEO ® Together with our values, ESG practices are the Ethisphere Institute for the 15th consecutive year, We strive to reduce our environmental impact. Premier October 19, 2022 guideposts we use to ensure that our strategy to deliver we have been repeatedly recognized for our continually works toward sustainable operations, as long-term growth and value creation also results in a commitment to achieve Premier’s growth goals demonstrated by our environmental policy, newly positive and sustainable global impact. through ethical best practices. adopted in 2022. We also recently assessed our greenhouse gas (GHG) emissions to baseline our carbon Underscoring this point, in October 2021, Premier Premier is committed to health and wellness solutions footprint for Scope 1 and 2 GHG emissions. As part of established a formal, Board-driven process for managing for a diverse world. Our Diversity, Equity, Inclusion and our ongoing focus to minimize our environmental and reporting how we are incorporating and leveraging Belonging (DEIB) program focuses on a two-pronged impact, we will continue to enhance GHG measurement ESG practices across our business. In elevating ESG, or approach: (1) developing talent with a greater diversity of to assess Scope 3 GHG emissions in 2023 to advance sustainability, to the highest levels of our company, we thought and perspectives, and (2) multiplying our efforts our environmental efforts. believe we are sending a clear message to our by harnessing the collective power of our members. In stakeholders about the importance of these practices. 2022, Premier rolled out the One Premier Growth In 2022, we advanced our efforts further by undertaking Mindset, a system of agreements, values, skillsets and
IN THIS SECTION ABOUT US OUR APPROACH TO SUSTAINABILITY ABOUT THIS REPORT 2022 ESG HIGHLIGHTS 2022 AWARDS AND RECOGNITION Making a Premier Impact At Premier, we’re reinventing the next generation of healthcare, using every tool in our arsenal to improve health outcomes and lower costs. OVERVIEW
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management COMMITTED TO MAKING A DIFFERENCE Sustainability is at the heart of our mission, culture and business practices. Transforming healthcare is more than our goal — it’s in our DNA. At Premier, we’re dedicated to ensuring better healthcare and making a positive impact on society. ABOUT US OUR OUR MISSION VISION PREMIER AT A GLANCE Premier is a leading healthcare improvement company uniting an alliance of more than 4,400 U.S. hospitals and health To improve the health of communities. Through the collaborative power of the systems and nearly 250,000 other providers and organizations to transform healthcare from the inside out – making it Premier alliance, we will lead the transformation to smarter, faster and better. With integrated data and analytics, collaboratives, supply chain solutions, and consulting and high-quality, cost-effective healthcare. other services, we enable better healthcare and outcomes at lower costs. We play a critical role in the rapidly evolving healthcare industry, helping to shape everything from healthcare policy for populations to quality of life for patients. We do this by collaborating with our members and leveraging the power of our data and technology and consulting platform to co-develop innovative, long-term solutions that are reinventing and improving the way care is delivered to patients nationwide. OUR VALUES Innovation Integrity MORE THAN MORE THAN APPROXIMATELY Seeking breakthrough opportunities, taking risks Integrity of the individual, the enterprise and the alliance. DATA ON MORE THAN and initiating meaningful change. Focus on People Passion for Performance U.S. hospitals and annual group Demonstrating respect for all, and mutual commitment to alternate A passion for performance and a bias for action, creating the success of the alliance, our employees, our business health systems are sites/other U.S. HOSPITAL purchasing real value for all stakeholders and leading the pace. 1 partners and the communities we serve. provider 2 PREMIER DISCHARGES volume 1 1 organizations MEMBERS 1 As of June 30, 2022. 5 2 For CY2021.
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management OUR APPROACH TO SUSTAINABILITY We believe that our commitment in these strategic areas agencies, industry norms and peer best practices, By applying in-depth analysis of the insights that we MAKING A PREMIER IMPACT will create long-term value for our stakeholders, achieve and stakeholder surveys. The assessment identified 24 gained through the materiality assessment, we believe Premier’s sustainability strategy reflects the intersection sustainable business success, and, ultimately, improve high-priority topics for our stakeholders. The results of Premier is well positioned to execute our commitment of our mission to improve the health of communities the health of our communities. Our 2022 Sustainability this materiality assessment will help guide our approach to better understand and improve environmental, social and our business strategy anchored in revolutionizing Report details the work we do every day to advance our to ESG and ensure that we effectively allocate resources and economic progress within the key focus areas of healthcare. Our approach is centered on the ESG initiatives and highlights the progress we made over to the areas that matter most to our stakeholders and our ESG program. We plan to review and enhance the environmental, social and governance (ESG) areas most the past year thanks to the dedication of our employees. are most relevant to the long-term success of our program as appropriate based on the evolution of our critical to our stakeholders and guides how we aim to business and value creation. business and feedback from our stakeholders. See the make a sustainable, positive impact for our communities, Appendix for a complete list of definitions for all 24 IDENTIFYING OUR employees, partners, suppliers and the environment ESG factors. ESG PRIORITIES – a Premier Impact. We believe that our long-term financial success and our sustainability strategy are Our sustainability strategy is informed by insights interdependent and start with our unique culture gleaned from a recent materiality assessment of various ETHICS AND We are committed to strong corporate governance, ethical behavior and responsible – one that is committed to making a difference in ESG factors and our engagement with stakeholders COMPLIANCE business practices that build trust and promote the long-term interests of our stakeholders. all that we do. inside and outside Premier. Throughout this report, we provide information on relevant governance and initiatives related to these priority areas as part of our To effectively transform healthcare, we aim to build a culture of high-performing individuals, leaders CREATING SUSTAINABLE VALUE OUR PEOPLE continued commitment to ESG. and teams with a “People First Growth Mindset,” living our core values and maintaining a high level of AND CULTURE By leveraging the powerful combination of our unique employee engagement and retention. Materiality Assessment of ESG Priorities partnerships with health systems and our unmatched In early 2022, Premier conducted a materiality data and technology and services platform, we aim to Our mission is to improve the health of communities. We enable our member healthcare providers IMPROVING assessment, led by a third-party sustainability expert, lead the transformation to higher quality, more cost- and other customers to deliver higher-quality healthcare by leveraging our data and analytics COMMUNITY to better understand the ESG topics most relevant to effective healthcare. capabilities, resulting in improved health outcomes and lower costs. HEALTH our long-term operational and financial success and Our core ESG principles are embedded in how we to inform long-term our strategic approach in managing We enable our members to provide better healthcare and improved outcomes at a lower cost for patients operate and empower our members and other these areas. The materiality assessment began with RESPONSIBLE by improving the quality, efficiency, sustainability and resiliency of the healthcare supply chain and customers to deliver better healthcare, advance social a list of hundreds of ESG factors and ultimately SUPPLY CHAIN leveraging our industry-leading technology capabilities powered by one of the nation’s largest repositories responsibilities and improve environmental impacts. narrowed these down to the most relevant to of clinical, operational and financial data. Premier and our industry. Our ESG priorities are aligned with five strategic pillars: As part of our efforts to improve the health of our communities, we pursue both eco-friendly (i) Ethics and Compliance, (ii) Our People and Culture, The importance of each ESG factor to both external and ENVIRONMENTAL practices throughout our operations and advance solutions to help our members minimize (iii) Improving Community Health, (iv) Responsible Supply internal stakeholders was then assessed to incorporate STEWARDSHIP their environmental footprint. Chain, and (v) Environmental Stewardship. leading ESG frameworks and standards, ESG rating 6
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management As part of our approach to sustainability, we engage with a variety of internal and external stakeholders LEARNING FROM whose support is critical to the long-term success of our business or who are materially impacted by Engaging with Our Key Stakeholders our business operations. Our stakeholders' perspective and feedback help to inform, prioritize and OUR STAKEHOLDERS An essential aspect of managing our ESG initiatives is continuously improve our ESG strategy. the comprehensive approach we take to stakeholder engagement. We believe that creating value for all stakeholders — both internal and external — is critically important for our long-term business success. Healthcare Provider Members Political Regulators and Other Customers and Advocates We frequently engage with our stakeholders to help build a deeper understanding of key ESG topics and We continually engage with our healthcare provider members and other Our Government Affairs team engages with legislators, regulators and accelerate progress on our initiatives. Our engagement customers to solicit feedback across several critical ESG topics, including key government decision-makers on ESG-related issues and seeks includes a mix of open dialogue, collaboration and product quality and safety, climate change and environmental risks, supply opportunities to provide regular input into government reviews related transparent disclosure. We listen and learn from our chain resiliency and diversity, customer privacy and business continuity. We to healthcare policies. stakeholders and use their input to inform, shape and engage with our members and other customers through industry advance our ESG strategy. We value stakeholder views conferences, newsletters, surveys, forums and advisory groups. and insights and believe that positive, two-way conversation builds informed relationships that promote transparency and accountability. Group Purchasing Organization Communities and Direct Sourcing Suppliers We engage and partner with community members and non-profit organizations to align their needs with Premier’s philanthropic support, Whether through committee gatherings, industry conferences or in-person employee volunteerism and innovative solutions to support and provide meetings, we diligently engage with group purchasing organization (GPO) underserved communities with healthcare improvements, economic and direct sourcing suppliers to help us identify innovative, sustainable empowerment and health equity. sourcing options, foster a diverse supply chain, and conduct due diligence As part of our overall stewardship that assesses environmental considerations, human rights, cybersecurity engagement efforts, we meet with and other ESG factors. our stockholders to discuss our ESG practices and initiatives. Over the Financial Community Employees past year, we reached out to We regularly communicate with investors and equity research analysts Our employees are foundational to Premier’s success and their feedback stockholders representing through industry conferences, earnings calls and one-on-one meetings and helps shape our business decisions and advance our purpose-led strategy website disclosures to discuss our ESG initiatives and progress in the areas to improve the health of our communities. We are intentional in creating approximately 52% of our total of climate change, cybersecurity and data privacy, executive compensation opportunities for employees at all levels to provide input into our ESG Class A common shares outstanding, and board composition, talent management, and employee diversity as well practices and strategy on topics such as workplace flexibility, DEIB and as other ESG- and business-related topics that are important to the professional development. We gather valuable feedback through frequent and our stewardship team met with financial community. employee engagement throughout the year with surveys, newsletters, stockholders representing more than employee resource groups and team meetings. 37% of our common stock. 7
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management The Nominating and Governance Committee (NGC) has The ESG Steering Committee plays a key role in ESG GOVERNANCE primary responsibility for ESG oversight and periodically championing and governing our overall sustainability As a whole and through its standing committees, our Board of Directors (Board) works closely with our executive reports to the full Board regarding ESG matters, such as: strategy and priorities. The ESG Steering Committee is management team to oversee our ESG initiatives and sustainable business practices. Our Board is committed to directed by our Vice President of Investor Relations and + Monitoring and evaluating programs and policies ensuring proper governance and management accountability of policies and operational processes to effectively is comprised of cross-functional leaders who meet relating to ESG matters. manage relevant ESG matters in a manner that advances the long-term success of our business, as outlined below. quarterly to develop and drive Premier’s sustainability objectives. The ESG Steering Committee provides + Periodically reviewing performance related to ESG quarterly updates to the NGC on our ESG program, issues, including progress toward the achievement RESPONSIBLE PARTY OVERSIGHT AREAS FOR ESG MATTERS emerging trends and stakeholder engagement. of ESG goals. All enterprise risk management of ESG-related areas (strategic, operational, For more information, please see our Board committee Board of Directors + Overseeing corporate communication plans and financial, legal, information technology and reputational). composition and charters under Corporate Governance any sustainability or similar reports in connection in the Investors section of our corporate website. Nominating and Corporate governance and ESG oversight of programs and policies, progress of initiatives, with ESG initiatives. Governance Committee external disclosures, and shareholder trends. + Considering and monitoring trends, shareholder Audit and Financial, legal and regulatory compliance and cybersecurity and ethical risks, concerns and emerging issues related to ESG that Compliance Committee including metrics and disclosures of ESG-related matters. affect Premier and its industry; consulting with management; and making recommendations to Corporate compensation philosophy and structure at all employee levels and Compensation Committee the Board regarding overall ESG matters. policies relating to ESG matters. 8
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management semi-annual employee engagement survey that Risk Management of ESG Factors Integration of ESG into Executive Compensation ABOUT THIS REPORT incorporates diversity-related topics and questions. One of our Board’s responsibilities includes playing an The Compensation Committee approved the inclusion of The Board believes that these elements are additive active role in effective governance and management two ESG-related metrics in our annual incentive plan This report covers the progress of our ESG strategy to supporting our mission to improve the health of of our environmental and social risks inherent in our beginning in FY2023. First, as part of our strategic goals, and initiatives during our fiscal year ending June 30, communities and achieve our vision to lead the business model and industry. The leadership structure Premier is targeting an increase in GPO member spend 2022 (FY2022). We have aligned our report with the transformation to high-quality, cost-effective healthcare. of our Board is intended to support and promote through diverse suppliers. Second, to help foster a Sustainability Accounting Standards Board (SASB) effective enterprise risk management and oversight high-performance culture, we are including an overall Standards related to Health Care Distributors and to of areas related to information security and privacy, employee engagement score target based on our relevant topics from Medical Equipment and Supplies supply chain management, human capital and Software and IT Services. We also identified several management, and business ethics and compliance. U.N. Sustainable Development Goals (SDGs) that we For more information, please see the Risk believe are supported by our business activities and key Management and Business Continuity section of this priority areas. AVERAGE BOARD TENURE: report or our Proxy Statement which can be found in BOARD OF the Investors section of our website. Unless otherwise noted, all quantitative company DIRECTORS >5 years data provided throughout this report covers FY2022, 7 Governance and Board Diversity 10 Directors reflecting data for the period from July 1, 2021, through Our Board is comprised of talented and dedicated June 30, 2022. Some information corresponds to the < 5 years 3 directors with a diverse mix of experience, skills and calendar year of 2021 (CY2021) for the period of backgrounds that reflect the strategic needs of our January 1, 2021, through December 31, 2021, and will business and the nature of the environment in which be noted as such. We have also included certain Women 30% AVERAGE BOARD MEMBER AGE: we operate. We recognize and value the benefits that subsequent initiatives that occurred after the end of diversity can bring to our Board, our organization and FY2022 and have endeavored to note them as such. 40% our stockholders. As of June 30, 2022, 40% of our African-American 10% 63 Throughout the report, we also guide readers to DIVERSE Board is comprised of diverse directors. additional sources of information on our corporate website and other website references for convenience. Diversity is an important factor considered by the NGC BOARD MEMBERS WITH Please see our forward-looking statement on page 2 in recruiting new directors, consistent with our ESG SKILLSET: of this report for more information. Corporate Governance Guidelines and Proxy Statement, which can be found in the Investors section 3 of our corporate website. We believe diversity on our As of June 30, 2022 Board also helps to advance our corporate leadership diversity and overall DEIB strategy. For more information, please see the Our People and Culture section of this report. 9
v Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management 2022 ESG HIGHLIGHTS IMPROVING RESPONSIBLE ENVIRONMENTAL ETHICS AND COMPLIANCE OUR PEOPLE AND CULTURE COMMUNITY HEALTH SUPPLY CHAIN STEWARDSHIP Continued achievement of Launched Advocated for Launched greenhouse gas (GHG) DEIB strategic pillars data-driven policies 100% employee Scope 1 and Scope 2 that help solve poor health outcomes to guide, accelerate and measure how we completion emissions assessment. and disparities in maternal-infant care. provide health and wellness solutions to an of our compliance education courses increasingly diverse world. including anti-corruption and human trafficking, fraud, waste and abuse, Advocated for men who identify as and Health Insurance Portability and Launched our LGBTQ+ to donate blood, Accountability Act (HIPAA). resulting in FDA ONE PREMIER to review its blood GROWTH MINDSET donation rules. initiative to enhance our culture. Sought federal support for elderly in nursing homes to implement electronic health records and Adopted an electronic clinical surveillance Environmental Policy. technology to enable better and Advanced DEIB through a safer care for one of our nation’s member-led commitment to our most vulnerable populations. Supplier Diversity Pledge. of the Board of In CY2021, Premier members spent over Directors is diverse. 40% $1 billion with diverse companies and small business enterprises.
v Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management 2022 Premier and our leaders were recognized in many ways this past year, and we are proud to share a few awards and recognition here. To learn more, please see the Awards and Recognition section of our website. AWARDS AND RECOGNITION 2022 World’s Most Ethical 2021 Achievers 50 Most 2021 Diversity Impact Charlotte Business ® ® Companies Honoree by Engaged Workplaces Awards™ Top 10 Journal’s “Healthiest ® Ethisphere Institute Enterprise-Wide Employee Employers of Greater – Resource Group Award Charlotte” Award 2022 th 15 – Consecutive 1st Year Place President and Chief Executive Officer named to The CEO Forum’s “Top 10 CEOs Fast Company’s World Bringing Predictive Analytics Transforming Healthcare” ® Changing Ideas, AI and Healthiest Employers to Healthcare, selected by the Data, 2021 for Syndromic Top 100 Healthiest Agency for Healthcare 2021 LinkedIn’s Top Surveillance Workplaces in America Research and Quality (AHRQ) Companies in Charlotte – – – Best Places to Work in Honorable Ranked 1st ® Healthcare for Conductiv , rd Mention 23 Place a Premier Company Chief Diversity and Inclusion Officer named to Business Beyond magazine’s “The Top 10 Most Influential D&I Leaders” in 2022 11
IN THIS SECTION ETHICS AND COMPLIANCE ENTERPRISE RISK MANAGEMENT AND BUSINESS CONTINUITY CYBER RISK MANAGEMENT, DATA SECURITY AND CUSTOMER PRIVACY GOVERNMENT AFFAIRS AND ADVOCACY Value of Integrity We recognize the value of integrity as the underpinning of our business operations and relationships. 2022 HIGHLIGHTS ETHICS AND ® + Named as one of the World’s Most Ethical Companies ® by the Ethisphere Institute for the 15th consecutive year. + Continued to work to shape federal and state laws, regulations and policies that reflect our commitment to improving healthcare quality and safety and reducing costs. COMPLIANCE
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management At Premier, we recognize the value of integrity, and our approach to ethics and compliance begins at the highest level of our company. Our Board sets high standards for our directors and workforce members, which includes employees and contractors, based upon our philosophy regarding the importance of sound corporate governance. regulatory requirements and best practices. In addition, apparent or potential conflicts of interest between guidance for Medicare Parts C and D plan sponsors. ETHICS AND we benchmark our ethics and compliance program personal and professional relationships. For more During CY2021, 100% of employees completed COMPLIANCE through an independent third party every two years. information on the Board Code of Ethics and Conflict this education. Our next workplace ethical culture assessment is of Interest Policy, please see the Governance Our accomplishments over the past year demonstrate Our directors annually attest to their compliance with the expected to be conducted in FY2023. Documents section of our website. the continued collaboration between business leaders Code of Conduct, the Board Code of Ethics, the Board and the Corporate Compliance team toward achieving Code of Conduct Conflict of Interest Policy and Disclosure Statement, and Premier’s growth goals through a safe and secure Premier maintains a Code of Conduct (Code) that EDUCATION, AWARENESS the Group Purchasing Organization Code of Conduct process. Named as one of the World’s Most Ethical applies to all workforce members and directors. AND ACKNOWLEDGMENTS (GPO Code). All sourcing committee and advisory ® ® Companies by the Ethisphere Institute for the 15th Workforce members who violate our Code may be subcommittee members receive education annually All employees complete an interactive course that consecutive year, our continued success reflects our subject to disciplinary action, up to and including on our GPO Code, Confidentiality Policy, Conflict of provides an overview of our Code as part of our annual commitment to integrity and meeting the highest termination of employment, subject to applicable laws. Interest Policy, and Insider Trading Policy. During compliance education. The CY2021 course included ethical standards. For more information on our For more information on the Code as well as related CY2021, 100% of directors and committee and compliance content about business ethics, bullying, compliance program, please see our most recent ethical business policies — including but not limited to subcommittee members completed this education abusive conduct, intellectual property, modern slavery, Annual Compliance Report. conflict of interest, confidentiality, and human and related acknowledgments. antitrust issues, and dealing with competitors and trafficking — please see the Ethics and Compliance customers. During CY2021, 100% of our employees Whistleblower Policy section of our website. BOARD GOVERNANCE completed this education, which includes attestation The Audit and Compliance Committee (ACC) established AND OVERSIGHT that they recognize and understand the Code. Premier maintains Supplier Standards that a Whistleblower Policy that includes our confidential and communicate our values and expectations and anonymous reporting helpline designed to promote It is the duty of our Board to serve as prudent Employees and contractors also complete annual emphasize the responsibilities and obligations of open communication of concerns regarding potentially fiduciaries for our stockholders and oversee the awareness education on the Health Insurance suppliers when doing business with us and our unethical or illegal business. We provide whistleblowers management of our business. It is our goal to advance Portability and Accountability Act (HIPAA) and on how alliance members. Suppliers are expected to uphold with protection from loss of employment status and the highest standard of ethical behavior and integrity to properly obtain, use, share, maintain and transfer these standards. workplace harassment. For more information on these and to ensure compliance with all applicable laws, protected data. During CY2021, 100% of employees procedures, please see our Whistleblower Policy and rules and regulations. Our corporate governance completed this education. Our Board is also subject to a Board Code of Ethics our corporate compliance guidelines that are a part of practices are established, monitored and regularly and a Board Conflict of Interest Policy and Disclosure the ACC charter. Premier did not experience any assessed by our Board, with assistance from the NGC. As part of our annual compliance education, employees Statement. These documents are intended to focus whistleblower-related events in FY2022. For more information, please see our Corporate also complete several online courses to meet regulatory the Board and each director on areas of ethical risk, Governance Guidelines. requirements, including programs to satisfy the annual provide guidance to directors to help them recognize fraud, waste and abuse education requirements per the and deal with ethical issues, and promote honest and We regularly assess our policies, programs and Code of Federal Regulations (CFR) and sub-regulatory ethical conduct, including the handling of actual, initiatives to ensure compliance with the latest 13
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management Premier has established a robust framework and Industry-Leading Ethical Business Standards Intellectual Property and Competitive Behavior ENTERPRISE RISK continues to build capacity to complement our We are a founding member of the Healthcare Group We offer our members a range of products to which we sustainability-conscious enterprise risk management MANAGEMENT AND Purchasing Industry Initiative (HGPII), a voluntary have intellectual property rights, including online program, enabling: association dedicated to ethical conduct and business services, best practices content, databases, electronic BUSINESS CONTINUITY practices of GPOs. HGPII is based on a set of principles tools, web-based applications, performance metrics, + A thorough organizational knowledge of sustainability, Our Board plays an active role in overseeing the including the creation of and adherence to a written business methodologies, proprietary algorithms, promoting the capture of emerging sustainability risks. management of our risks. The committee structure of code of business conduct that establishes high ethical software products and consulting services. We the Board supports and promotes effective enterprise values, high-quality healthcare, cost effectiveness, an vigorously protect our intellectual property by relying on + Assessments revealing sustainability opportunities risk management (ERM) and oversight. open and competitive purchasing process, sound and, if need be, enforcing our federal, state and common as well as risks. business practices, and public accountability. Premier’s law rights as well as contractual arrangements. For Enterprise Risk Management + Measurement (qualification and quantification) Senior Vice President of Supply Chain is the current more information, please see our 2022 Annual Report on Our Board retains ultimate oversight of ERM and of sustainability risks. chair of the HGPII Steering Committee. For a complete Form 10-K which can be found in the Investors section remains informed through regular reports and updates, list of our professional associations related to of our corporate website. + Common language and standards across enterprise including a standing ERM update at every quarterly compliance best practices, please see our most recent functions increasing collaboration, coverage, rigor, board meeting. Furthermore, each board committee Annual Compliance Report. consistency in management and reporting. evaluates and oversees the management of risks within its area of responsibility. In addition, our Board and committees receive regular reports from our President BUSINESS CONTINUITY and Chief Executive Officer (CEO), Chief Administrative AND DISASTER RECOVERY and Financial Officer (CAO/CFO), General Counsel, Chief Ethics and Compliance Officer, and other members of Our Business Continuity and Disaster Recovery Plan our leadership team regarding areas of significant risk. (BCDRP) is designed to minimize disruption in the For more information, please see our recent Proxy quality of our service delivery in the event of a natural Statement which can be found in the Investors section disaster, cyberattack or other emergency. Key business of our website. continuity and infrastructure recovery capabilities are validated through third-party audits, cyber maturity Through a risk management approach that continuously assessments, and executive- and Board-level assesses and improves our information technology and companywide tabletop exercises at least annually. In cybersecurity risk deterrence capabilities, our addition, the BCDRP is periodically subject to internal Information Security, Privacy, Risk Management and audit to confirm that it remains applicable to the current Compliance groups have formed a functional risk environment. Adjustments are routinely made to the collaboration to provide leadership and oversight when BCDRP to assure recovery of business operations and managing privacy, compliance and cybersecurity risks. infrastructure in accordance with business commitments and other requirements. 14
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management The ACC oversees our cyber risk management program. DATA PRIVACY ADDRESSING CYBER THREATS CYBER RISK Our Chief Information Security Officer (CISO) and Chief As part of our services and solutions offered to As the capabilities and level of sophistication of hackers MANAGEMENT, Privacy Officer (CPO) plan, implement and administer customers, we collect and process various types of become more advanced, so do the threats they pose. our information security and privacy initiatives, including DATA SECURITY AND data. This data is used to provide certain contracted To effectively tackle this increasing risk, we have providing quarterly updates on information security and services and is collected, stored and maintained in operationalized a series of measures that are designed CUSTOMER PRIVACY privacy to the ACC and continuous updates to our accordance with applicable privacy laws and to prevent hackers from penetrating our systems leadership and executive teams and IT Steering We rely on digital technology to conduct our business regulations. Certain of our customer agreements provide (cybersecurity) and trigger containment and recovery Committee. The CISO’s and CPO’s teams jointly operations and engage with our members and business for secondary data rights, such as permitting the capabilities should they penetrate our systems collaborate on the response and investigation of partners. Through a risk management approach that de-identification of protected health information (PHI), (cyber resilience). suspected information security and privacy incidents. continually assesses and seeks to improve our which is done in accordance with HIPAA. Our Privacy Our CISO has a documented Incident Response Policy information technology (IT) and cybersecurity risk Policy addresses the use and disclosure of data for the identification and escalation of security breaches deterrence capabilities, our Information Security, Privacy, collected outside our customer agreements, including SECURITY AWARENESS and other cyber incidents. The policy details guidelines for Risk Management and Compliance groups have formed the requirements of the California Consumer Privacy Act TRAINING PROGRAM incident response and communication responsibilities. a cross-functional collaboration to provide leadership (CCPA), such as the categories and types of personal We promote a strong culture of security awareness Customers are contractually responsible for informing us and oversight when managing our privacy, compliance information we may obtain, what we do with that data, among our employees through ongoing training and of potential security breaches. There were no significant and cybersecurity risks. with whom we share it, and its related purpose. We also regular communication. We have a formal Security data breaches requiring disclosure during FY2022. continuously monitor the regulatory landscape to ensure Awareness Training Program for all employees that that we are compliant with new and changing privacy- SECURITY, GOVERNANCE addresses purpose, scope, roles, responsibilities and related laws and regulations that may be applicable to AND OVERSIGHT management commitment. Training, including “phishing” our business. For more information, please see our exercises, is provided at orientation and at least annually Privacy Policy on our website. Premier’s Board and leadership team are committed to thereafter for all employees. During CY2021, 100% ensuring that information security risks are adequately of employees completed our Security Awareness managed, and appropriate procedures are applied Training Program. throughout the organization to effectively monitor, mitigate and respond to cyber risks, threats and incidents. 15
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management CERTIFICATIONS AND Management and Budget (OMB) Circular A-130, THIRD-PARTY AUDITS Appendix III, Security of Federal Automated Information Resources; National Institute of Standards and High-quality and objective assessments are critical to Technology (NIST) Special Publication 800-37, Guide for the continued effectiveness of cybersecurity controls. the Security Certification and Accreditation of Federal Premier’s third-party audits and certifications, Information Systems; NIST Special Publication 800-53A, documentation, and legal commitments help support Assessing Security and Privacy Controls in Federal customer compliance. Our products regularly undergo Information Systems and Organizations; and NIST independent verification of their security, privacy and Special Publication 800-53, Security and Privacy compliance controls, achieving certifications, Controls for Information Systems and Organizations. attestations of compliance, or audit reports against stringent standards. As a part of the independent verification process, third-party auditors examine SECURITY ASSESSMENT AND Premier’s end-to-end security practices — including COMPLIANCE REQUIREMENTS data centers, infrastructure and operations — at a FOR THIRD-PARTY SUPPLIERS regular cadence. Prior to onboarding third-party vendors, we ensure that We routinely engage with a reputable, objective and such vendors provide attestations from objective, licensed third party to perform a comprehensive reputable and licensed assessors as to the caliber of the assessment of our controls, capabilities and programs vendor’s security controls relative to stringent industry against stringent standards, such as: standards, which are appropriate to their access privileges and scope of services provided. Further, third + Federal Information Security Management parties are required to agree to commercially reasonable Act (FISMA) security, confidentiality and privacy contractual terms. Vendors are reassessed depending on risk level to better + System and Organization Control (SOC) 2 Type 2 ensure compliance with legal and regulatory requirements, monitor control design, and continually + System and Organization Control (SOC) 1 Type 2 develop and update response plans that support + Payment Card Industry Data Security Standard organizational risk tolerance. (PCI DSS) Technology Vendor Compliance + Sarbanes-Oxley Act of 2002 We directly conduct all data processing activities required to provide our services. However, we may Upon request, our Vice President of Risk and engage third-party vendors to provide services related to Compliance can provide our Security Assessment our solutions. We outsource our data center needs to Report (SAR) and Security Compliance Letter of third-party providers utilizing cloud-based platforms and Attestation (LOA). These documents not only serve as leveraging their physical and data security infrastructure. prima facie evidence of our security measures but also They are contractually required to comply with our as official attestation that a comprehensive assessment third-party vendor and security protocols as well as was performed based on criteria relative to the Federal other policies, processes and procedures, in addition to Information Security Management Act (FISMA); Office of all applicable data privacy laws and regulations. 16
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management This includes shaping federal policies to better prepare shifting the incentives in our health system from POLITICAL CONTRIBUTIONS GOVERNMENT AFFAIRS hospitals and other providers for the impact of climate sickness-based to wellness-based. Premier is Our political contributions are made through a voluntary, AND ADVOCACY change and propelling efforts to reduce healthcare’s advocating for federal policies to address the underlying eligible employee-funded PAC: the Premier, Inc., carbon footprint. To this end, Premier submitted social and economic inequities as well as systemic Our Washington, D.C.-based Government Affairs team Employees’ Civic Action Fund (FEC ID: C00346288). recommendations to the White House on ways to create barriers and biases that drive disparities in care. acts as an advocate for our members and the The PAC’s mission is to raise funds to support federal incentives to drive greener choices. communities they serve. Premier educates federal and lawmakers who share the vision, values and commitment Premier also drew attention to the inequity that exists state lawmakers and the executive branch about our to improve healthcare quality and safety and reduce Promoting Community Health Initiatives for men who identify as LGBTQ+ and their eligibility to members and industry, and the issues that affect our costs. The PAC is voluntary and bipartisan, contributing Reducing Disparities in Maternal Health donate blood and advocated for action in this space, business. We accomplish this by meeting with to both political parties. Contributions are received and Premier is working with Congress and the Biden which led to Congress pressing the U.S. Food and Drug lawmakers and federal administration staff; activating disbursed pursuant to internal contribution guidelines administration to advance data-driven policies that help Administration (FDA) to revise its policy. In response, the our members to reach out to their lawmakers through and in accordance with applicable election laws. solve poor outcomes and disparities in maternal-infant FDA has launched a review of blood donation rules for our Government Affairs Network, which is comprised of care. We are proud to support the Black Maternal Health gay men and a study to evaluate alternatives to what executives from our member healthcare providers; and The PAC is overseen by the Employee PAC Advisory Omnibus Act of 2021 (S. 346/H.R. 959) and the Premier has identified as a discriminatory policy. working through our Employee Political Action Committee, comprised of a subset of contributors to the bipartisan Maternal Health Quality Improvement Act of Committee (PAC). Our policy positions are developed PAC. We share information on all contributions made Protecting Vulnerable Populations in Nursing Homes 2021 (H.R. 4387/S. 1675) and has urged Congress to and approved by a policy committee comprised of from the PAC with its contributors biannually. The PAC The COVID-19 pandemic brought to the forefront the pass this legislation. These bills aim to comprehensively leaders in our Government Affairs Network. only contributes funds to federal lawmakers. It does not specific challenges nursing homes face in containing the improve every dimension of maternal-infant health in make any contributions to state policymakers or to spread of infectious disease. The digital divide between America. In cooperation with the Congressional Black organizations that are recognized under Section 527 of acute care and nursing home settings and the lack of Maternal Health Caucus, we held a briefing that OUR POLITICAL ADVOCACY EFFORTS the U.S. federal tax code and registered with the Federal real-time intelligence to prevent and manage a spread highlighted the HHS Perinatal Improvement Election Commission. Every day, we work to shape laws and regulations that are at the root of this problem. As such, Premier is Collaborative — an initiative sponsored by the reflect our commitment to improving the cost, quality seeking federal support for nursing homes to implement Department of Health and Human Services (HHS) Office The PAC abides by all applicable federal lobbying and safety of healthcare and advance our mission of electronic health records and electronic clinical on Women’s Health in partnership with Premier to disclosure requirements. Premier’s previous Federal improving the health of communities. Below, we surveillance technology to enable better, safer care for advance maternal and infant healthcare. The briefing Election Commission and Form LD-2 lobbying highlight a selection of notable advocacy initiatives over our nation’s most vulnerable populations. bolstered the support of these legislative efforts and activity disclosure reports may be found at the the past year. For more information, please see the enhanced the congressional knowledge base of this following websites: Advocacy section of our website. innovative work. Federal Election Commission (FEC) FY2022 POLITICAL-RELATED SPENDING BY OUR PAC: Aligning Policies with Environmental Principles Regular Lobbying Disclosures Advancing Health Equity and We are committed to helping our members and others in Social Determinants of Health Clerk of U.S. House of Representatives $109,114 $155,000 the healthcare industry promote the health of their Reducing disparities in care and achieving health equity LD-2 Lobbying Disclosure Reports Total Employee Total Political patients, workers, communities and the environment. across communities requires a holistic approach, Contributions Contributions 17
IN THIS SECTION OUR PEOPLE FIRST PHILOSOPHY RECRUITMENT, ENGAGEMENT AND RETENTION TALENT DEVELOPMENT DIVERSITY, EQUITY, INCLUSION AND BELONGING EMPLOYEE HEALTH AND SAFETY Guided by our values, our employees work every day to make meaningful differences in healthcare. At the core of what we do is our most valuable resource — our people. 2022 HIGHLIGHTS + Our Chief Diversity and Inclusion Officer was named in the Top 100 Diversity Officers and Top 10 DEI Influencers by the National Diversity Council for the past three years and, in CY2022, was recognized as one of the Top 10 Most Influential D&I Leaders by Beyond Exclamation magazine. OUR PEOPLE + 55% of our workforce identified as women, and 28% of our employees are racially/ethnically diverse. + 96% of our employees participated in professional development programs, which helped bolster career path opportunities and promotion of over 16% of employees. AND CULTURE
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management Our values — integrity, innovation, passion for performance and focus on people — guide our business decisions and the manner in which we make them and are what make our solutions stand out. Without our employees’ focus on our mission and willingness to serve, our ability to deliver value would be vastly diminished. We also provide a variety of resources from our OVERSIGHT Premier uses a myriad of evaluation methods, including OUR PEOPLE Employee Assistance Program to support the health external market surveys, geographic cost of living and As part of the Board’s risk assessment and and well-being of our employees and their families FIRST PHILOSOPHY cost of labor assessors, and external experts to ensure management responsibilities, the Compensation during challenging times, such as: that our compensation programs are competitive, We aim to build a culture of high-performing leaders and Committee reviews compensation policies and equitable and reasonable. teams with a “people first” mindset for evolving our + Let’s Talk about Mental Health and programs on an annual basis. Our Human Resources culture and organization, living by our values, and Emotional Well-Being Compensation team is led by our Senior Vice President We comply with all equal-opportunity laws and maintaining a high level of employee engagement and of People and reports directly to the CEO. This team regulations and continuously review compensation + Weathering the Storm: The Value of retention. Our ability to attract, engage, train, develop prepares a risk assessment report that addresses the levels to ensure fair and equal pay for all employees. Mindfulness in Times of Stress and retain top talent is critical to our success and the incentive compensation structure, plans and processes We also have a thoughtful and well-structured process value delivered to our members, customers, for annual review by the Compensation Committee. for strategic organizational reviews when restructuring + Finding Balance in a Digitally Driven World stockholders and other stakeholders. For a description of Premier’s executive compensation is necessary. program, refer to our Proxy Statement which can be + Managing Mental Health during Times of To meet these objectives, our people strategy is found in the Investors section of our corporate website. Social Change anchored upon three foundational goals: HEALTH AND WELLNESS Our wellness strategy provides financial incentives for Attract the best people through effective workforce We provide customizable benefits coverage, fitness and COMPENSATION AND BENEFITS employees who participate in certain wellness activities, planning and recruiting strategy. wellness programs, and healthy living incentives. We such as a personal health assessment, preventive Our Total Rewards Program combines competitive offer a Choice Flexible Benefits Program that provides screenings, and activity goals. Maintain a high-performing workforce with clearly compensation packages with health and wellness an array of health, dental and vision coverage along with defined goals, strong leadership and aligned incentives. resources, employee experiences, talent development, life and disability insurance, flexible spending, and paid and recognition opportunities. Our Total Rewards family leave offerings. Create a compelling work environment where philosophy and programs are designed to attract and employees feel valued and able to contribute to the retain exceptional talent at all levels of our organization. success of the business through fostering innovation, collaboration and growth. 19
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management In August 2021, Premier received the Achievers 50 Most Our leadership team outperformed global benchmarks RECRUITMENT, ® Engaged Workplaces award for our commitment to for its response to the pandemic and in areas related ENGAGEMENT employee-centered programs. We were also recognized to diversity, equity, inclusion and belonging in EMPLOYEE ENGAGEMENT for the outstanding achievements of our employee the workplace. AND RETENTION SCORE VS. GLOBAL resource groups (ERGs) with the 2021 Diversity Impact 1 BENCHMARK To maintain a People First culture, we have taken steps Our employees are our most critical asset. The success Awards™ Top 10 Enterprise-Wide ERG Award as well to act on our 2022 survey results in many ways, and growth of our business depends on our ability to as Executive Sponsor of the Year by the Global ERG including the following: attract, reward, retain and develop diverse, talented Network. Please visit the Awards and Recognition and high-performing employees at all levels of our section of our website for a full listing. AUG 2019 70 + Implemented programming that centers on growth, organization while sustaining a positive environment Benchmark - 72 diversity, equity, inclusion and belonging in the of anti-discrimination that ensures equal access to workplace, such as launching an all-employee OUR PEOPLE FIRST ENGAGEMENT opportunities. To succeed in an ever-changing and podcast, publishing an opportunity graph to automate competitive labor market, we continue to: Our continuous listening strategy is centered around our visibility for growth and development opportunities, “People First” engagement survey, which is conducted FEB 2020 and deploying mentorship opportunities across 72 + Develop and enhance human capital management biannually by a well-regarded, third-party employee the enterprise. strategies, objectives and measures that drive Benchmark - 72 engagement survey firm. It allows employees to share recruitment and retention. their voice and for the company to listen and learn from + Launched Phase 1 of our cultural initiative “One AUG 2020 79 employees’ experiences with a “One Premier Growth Premier Growth Mindset,” which is our intentional + Enhance our business performance. Benchmark - 74 Mindset.” The survey provides us with opportunities to way to continually enhance our culture in the same + Advance innovation. assess our employees’ experience, ensure alignment way would any other critical business objective. The with our mission and goals, and explore the factors that initiative focuses on enhancing our existing culture by + Foster employee development. influence a high-performance culture. The survey data introducing a cultural blueprint of agreements. Phase MAR 2021 81 provides valuable information about our workplace 1 introduced the first two agreements — Self-Mastery + Support our vision, mission and values. Benchmark - 74 culture and employee morale, which may be used to and Real Talk — encouraging an individual growth develop or refine our culture and to drive informed action mindset and open and honest feedback between For more information, please see our 2022 Annual SEPT 2021 79 planning at a local team level. We believe our strength is individuals and within teams. Report on Form 10-K which can be found in the Benchmark - 75 in our people, and we remain committed to making Investors section of our corporate website. + Began hosting a monthly enterprise leadership Premier a great place to work by aligning our People meeting to drive connection and communication We are focused on demonstrating strong practices First culture to our strategic priorities. By leveraging with executive leadership. aligned with our ethical, respectful and accountable employees’ perspectives and feedback, we develop MAR 2022 culture, resulting in positive employee experience. We 78 actionable plans at the local team and organizational + Introduced the Leadership Excellence at Premier believe that this goal is best supported by our emphasis level to support our vision and mission. Benchmark - 76 (LEAP) Program, delivering a leadership development on giving back to our communities; increasing well-being opportunity to select participants. In FY2022, employee engagement remained strong, and mental health awareness and support; and creating 1 Employee engagement scores and benchmarks were provided with increases in all major drivers of engagement. Our a thoughtful, inclusive culture where everyone can + Expanded discussion, education and connection by our third-party provider which uses a proprietary survey and employee engagement score was 78 as of March 2022, contribute and grow. scoring system. Benchmarks are refreshed every six months regarding employee networking through ERGs. above the global engagement benchmark of 76. We based on robust data sets that include employees from over 600 organizations across more than 150 countries. outperformed global benchmarks in all benchmarked questions and produced strong scores in other areas. 20
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management In FY2022, 90 mentors and mentees gained Developing Our Premier Leaders We use internally developed processes for career-level TALENT DEVELOPMENT opportunities for on-the-job growth, new connections, We also provide a Leading at Premier Program for our framework and talent and succession planning to We provide an assortment of instructor-led courses for visibility and personal success, while Premier gains a leaders who have direct reports, providing relevant provide employees with growth and advancement job-specific training as well as access to online learning highly engaged talent pipeline of inclusive future leaders learning topics to issues managers are facing in real opportunities which, in turn, drive the economic mobility platforms such as Workday Learning and LinkedIn with diverse backgrounds and experiences. In FY2022, time across our business. During FY2022, on a monthly of our workforce. Learning. Our online curriculum includes a selection of approximately 17% of mentors and mentees found new basis, approximately 25% of our leaders participated in over 9,000 internally developed and LinkedIn Learning We promoted 430 employees during FY2022 and 259 opportunities at Premier, and all program participants this program. All employees who become managers for courses, grouped categorically with topic areas such as employees in FY2021, representing more than 16% and were either satisfied or very satisfied with their mentor the first time are invited to join a new manager program leadership and management; productivity and time 10% of our total employees, respectively. Overall, we or mentee pair and the overall program experience. designed to orient those new to our management management; project management; diversity, inclusion believe our internal development initiatives are integral in philosophies, requirements and resources and provide and belonging; personal and business acumen; data In support of early-career talent, Premier sponsors a bolstering career path opportunities and advancements support in transition to this increased responsibility. analytics; and growth-mindset behaviors. In FY2022, our summer internship program. Of the summer 2021 intern for employees. employee participation rate was 96% in these programs. class, 41% were hired in a full-time capacity. In the In addition, in FY2022, we introduced the Leadership Additionally, tuition scholarships totaling nearly summer 2022 program, 35 students from undergraduate Excellence at Premier (LEAP) Program, delivering a $160,000 were provided during FY2022 to 41 qualifying to post-graduate programs from colleges and leadership development opportunity to 32 high-potential employees to aid in advancing their higher and universities across the country became contributing leaders. Designed to leverage a comprehensive needs continuing education. employees by working on meaningful projects that analysis, this program encourages bold thinking, provided an opportunity to build their resumes and have develops leadership skills, and builds a cross-functional We have a partnership with Professional Through Premier’s quarterly check-in practice, measurable success on key deliverables over a 12-week network. LEAP offers virtual classroom learning through employees are asked to set self-mastery objectives that Women in Healthcare (PWH), an period. Each student was paired with a supervisor and external training providers, networking with program support a growth mindset at the individual level. mentor to guide their professional development during alumni, cross-collaborative cohort meetings to enrich organization that provides a national Self-mastery objectives ensure that every employee at the summer. In addition to exposure within their learning, and a real-world project where individuals can voice and progressive leadership for Premier is intentionally working to develop department, students had ongoing education sessions apply their knowledge and newly gained skills toward competencies, skills and knowledge in support of the and community and social events to learn more about strategic business initiatives in the organization. women. During FY2022, a group of 69 company’s mission and individual aspirations. Virtually Premier, the healthcare industry and the impact on Premier employees, both women and all our employees set and made progress toward their communities we serve. Of the 2022 summer intern objectives in FY2022. TALENT PERFORMANCE men, participated in a PWH-curated class, 94% were recommended for hire, creating a strong AND RECOGNITION pipeline of diverse talent to join Premier. Furthering our development program supplemented by commitment to diversifying our workforce, 46% of our We provide an online rewards program, Values in Action, MENTORING AND LEADERSHIP internal complimentary education and interns were of ethnically diverse backgrounds and 50% to strengthen our culture of recognition by promoting Our mentoring program supports our learning culture, were female, thus supplementing our diverse talent pool mentorship to empower women to lead peer-to-peer appreciation. Recognized employees can provides career path guidance, and encourages personal of qualified candidates. award and/or accumulate points that can be used to and succeed in their careers, while growth and development across the enterprise. purchase merchandise, gift cards or tickets or make continuing to support a growing pipeline charitable donations. of female leaders in healthcare. 21
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management OUR MISSION: TO IMPROVE THE HEALTH OF COMMUNITIES Prioritizing Diverse Leadership Composition For purposes of our Board Diversity Policy, diversity DIVERSITY, EQUITY, We recognize and value the benefits that diversity can includes gender, ethnicity, age, persons with disabilities, The positive impact of our DEIB approach is far reaching INCLUSION bring to our Board, and our Corporate Governance sexual orientation, status as a diverse director under any not only within our company but also with the communities, members and other customers we serve. Guidelines include a formal Board Diversity Policy. The NASDAQ requirements, and other personal characteristics AND BELONGING Board believes that promoting the inclusion of different that would contribute to diverse viewpoints on the Board. Improving the health of communities is more than an perspectives and ideas helps mitigate group thinking For more information, please see the Governance and OUR FIVE STRATEGIC DEIB PILLARS ambitious goal; it is our mission. We believe that solving and improves oversight, decision-making and Board Diversity section of this report or our Proxy complex challenges requires a greater diversity of thought, governance. Diversity on the Board also demonstrates Statement on the Investors page of our website. cross-cultural representation, and engagement. We know our commitment to diversity at all levels within our Build a culture of high-performing leaders and that a diversity of perspectives, experiences and company. While all appointments to the Board are based LEADERSHIP teams with a mindset for evolving our culture and backgrounds is a powerful way to unlock new ideas and maintaining a high level of employee engagement AND CULTURE on merit, the Board considers the benefits of diversity in and retention and organizational growth. better understand the needs of others. identifying potential directors. At all times, we seek to maintain a Board comprised of talented and dedicated Our Chief Diversity and Inclusion Officer was named in the directors with a diverse mix of experience, skills and Top 100 Diversity Officers and Top 10 DEI Influencers by backgrounds who can collectively reflect the strategic Build a diverse workforce by identifying, the National Diversity Council for the past two consecutive needs of the business and the nature of the environment attracting and retaining a pipeline of diverse and years and, in CY2022, was recognized as one of the Top PEOPLE AND qualified candidates through targeted outreach, in which we operate. recruitment, employee development and 10 Most Influential Diversity and Inclusion Leaders by WORKPLACE selection in an anti-discriminatory environment Business Beyond magazine. that ensures equal access to opportunities. OUR STRATEGY Design and implement coordinated We believe the positive impact of our Diversity, Equity, community development initiatives in COMMUNITY Inclusion and Belonging (DEIB) approach is far reaching, partnership with employees, health system HEALTH members and life science partners to address not only within our company, but also for the communities the drivers of health that achieve health equity. and members we serve. Our Chief Diversity and Inclusion Officer manages our DEIB strategy and reports to our CEO with oversight by our Compensation Committee and Evolve strategies to continue the focus on Board. Our DEIB Council is comprised of cross-functional socioeconomic development and growth of employees and leaders and is the governing committee communities through minority- and women-owned that defines, drives and supports our five strategic DEIB SUPPLIER business enterprises (MWBE+). Use mass and volume of these programs to drive better DIVERSITY pillars. These strategic pillars act as the key performance healthcare outcomes, strengthen local economies, indicators of our DEIB strategy and are designed to and develop a more robust supplier-diversity accelerate how we provide health and wellness solutions ecosystem for the healthcare industry. to an increasingly diverse world. Create a Chief Diversity and Inclusion Collaborative with member-hospital PARTNERS AND chief diversity and inclusion officers to share MEMBERS 22 best practices and discuss the future of DEIB in healthcare.
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management EMPLOYEE DIVERSITY METRICS + Heightening our social media presence to enhance our employment brand and drive DEIB is part of our organization’s cultural DNA and awareness of our culture. critical to our success. As of June 30, 2022 EMPLOYEE DIVERSITY METRICS + Engaging with colleges, universities and professional Our vision is to maintain a workforce that represents the affinity organizations with a higher population of populations we serve. All our employees are located TOTAL EMPLOYEES ethnic representation. within the U.S., and 53 employees qualified as foreign nationals as of June 30, 2022. + Enhancing our internship program search. (We Employee Gender Representation Race and Ethnicity Representation (Percentage of Total Employees) (Percentage of Total Employees) achieved our goal of at least 46% ethnically diverse The data to the right reflects our workforce diversity and 50% gender-diverse intern hires for our summer metrics as of June 30, 2022. We assess workforce 2022 internship program.) White - 72.3% diversity as part of a broader effort to identify areas of continuous improvement to ensure that we are building Asian - 10.9% + Utilizing artificial intelligence (AI) to provide data on Female - 55% and retaining a diverse workforce while also leveraging identifying school, industry and geographic statistics Black or African American - 10.0% Male - 45% the importance of different knowledge areas and for the highest numbers of qualified ethnically diverse Hispanic of Latino - 3.6% perspectives to drive innovation, productivity and talent by providing real-time population data. excellence. We also analyze this data to determine how Other* - 2.7% best to attract and develop a pipeline of diverse and + Engaging our ERG members and recruiting more than qualified candidates and promote an inclusive, anti- 100 “employee ambassadors” to create a talent discriminatory environment of belonging that ensures outreach team that engages colleges and universities equal access to opportunities. with special programs such as hack-a-thons, essay MANAGER-LEVEL EMPLOYEES contests, career fairs, problem-solving projects, guest lecturers and guest professors, and other activities Employee Gender Representation Race and Ethnicity Representation RECRUITING DIVERSE TALENT to engage ethnically diverse talent and attract them (Percentage of Total Employees at Manager Level) (Percentage of Total Employees at Manager Level) to Premier. We have been very successful in fostering gender parity between our total workforce representation and + Creating programs such as our mentoring program, White - 80.7% management-level representation. We have identified LEAP (Leadership Excellence at Premier) Program opportunities to drive more parity in our racial and ethnic Asian - 7.6% and other connection opportunities to ensure career Female - 52% representation across the organization. As such, we Black or African American - 6.2% growth in the organization. Male - 48% have enhanced our approaches by addressing Hispanic of Latino - 3.2% recruitment sources and development programs as well + Offering a continuous stream of learning and Other* - 2.1% as engaging hiring managers in understanding the need development programs for all employees, all year to grow a more diverse pool of available and qualified long, through multimedia communication. talent by creating targeted initiatives and investing in * Includes full-time employees who self-identify as Native Hawaiian, Pacific Islander, American Indian, Alaskan Native, or two or more races. tools to engage diverse employees. Improvements to our activities include: 23
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management + Premier also has an Emergency Response Program EMPLOYEE RESOURCE GROUPS Our ERGs provide a way to channel information that Our ERGs aim to bring their spirit of inclusion and for all staff to provide guidance in the event of enhances our employees’ ability to network with peers belonging to transform our communities through both situations that may impact employee safety or normal We support ERGs as a vital part of our culture, helping of similar interest and fosters a sense of belonging volunteering and charitable donations. Over the past business operations. We leverage the Emergency us build an environment of diversity, equity, inclusion throughout the company, even while many of us are year, we supported various nonprofits aligned with each Response Program to provide all-staff alerts and and belonging and a sense of company pride. These working from home. We have nine ERGs with more than ERG’s particular area of focus. For example, our senior engage in regular testing and training to make sure groups provide opportunities to listen, learn, mentor, 400 employee representatives (15% of our employee vice president of supply chain sponsored an event for our workforce is familiar with Premier’s process in the grow and assist leadership with the cultural population) that operate together across business units the Wounded Warrior Project (WWP), leading Premier's event of an emergency. development of the organization and provide critical and locations around the country: Military Veterans and Allies ERG to being named by feedback on their workplace experiences and passion WWP as their top-contributing team in CY2021. Premier has maintained a robust and flexible response + Asian Employees and Allies around community development. Our ERGs act as the to the COVID-19 pandemic. We continually evaluate employee voice in helping leadership define the + Asian Indian Professionals for Excellence (APEX) public health guidance as well as state and federal law employee experience and leverage their knowledge EMPLOYEE HEALTH to ensure our practices are up to date with the changing + Black Professionals and Allies Connect for broader organizational success. nature of the COVID-19 pandemic. Premier has staff that AND SAFETY + Disabled Employees and Allies visit and work with our healthcare members. Any staff that performs work on a member site are also subject to Premier is proud of its commitment to employee health + Latin Employees and Allies member safety protocols. and safety. We take a multi-pronged approach to safety + LGBTQ+ Employees and Allies programs in the workplace to provide a healthy work environment for all employees. + Member Field Services Advisory Council PREMIER'S LEADERSHIP on Diversity and Inclusion + Premier maintains health and safety policies that COMMITMENT TO DEIB cover all aspects of the work environment, from + Military Veteran Employees and Allies Demonstrate commitment and accountability day-to-day office expectations to disease for modeling behavior that drives diversity, equity, + Premier W.O.M.E.N. preparedness and natural disaster response. Policies inclusion and belonging. are communicated to employees and available for Demonstrating our focus on nurturing a culture of review on our compliance portal. Cultivate and support a values-driven culture that diversity, equity, inclusion and belonging, every member promotes inclusiveness, innovation, openness, of our executive team acts as a sponsor for one or more + Premier also has a Corporate Emergency Response listening, learning and compassion. ERGs, leads the strategic pillars of DEIB, and sits on the Team (CERT) responsible for coordination and Build and maintain a diverse workforce at all levels Leadership Committee of the DEIB Council. management of emergency situations such as of our organization and identify, attract and retain a disruptive weather events, safety incidents, building pipeline of diverse and qualified candidates through In FY2022, our ERGs held over 25 workshops, disruption, public health concerns, and technology targeted outreach, recruitment, employee lectures, fireside chats, lunch and learns, and other and communication issues. Together with the Premier development and selection. events to further educate, relate, interact and network Continuity Management team, CERT helps ensure a with one another to form bonds and build a culture of return to business as usual as soon as possible. Create a work environment that assures equal understanding that helps us to provide a high- access to opportunities for professional growth performing workplace and truly embody a culture and advancement. of belonging. 24
IN THIS SECTION IMPROVING PATIENT OUTCOMES COST EFFECTIVELY HEALTH EQUITY PLANNING INITIATIVE AND COLLABORATIVE SUPPORTING THE MEDICALLY UNDERSERVED IMPROVING HEALTH THROUGH COMMUNITY DEVELOPMENT Our mission is quite simple: to improve the health of communities. We view this as not only our mission but our social responsibility. IMPROVING 2022 HIGHLIGHTS + Presented the Premier Cares Award to recognize exemplary COMMUNITY efforts by nonprofit community organizations to improve the health of populations in need. + Delivered upon our social responsibility through financial donations and employee volunteer efforts to support nonprofits dedicated to improving community health. HEALTH
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management HEALTH EQUITY PLANNING INITIATIVE AND COLLABORATIVE In CY2023, Premier's Strategic Collaborative team anticipates launching a health equity collaborative to support members in meeting and exceeding new regulatory and payer requirements that are designed to reduce health disparities. Through this new collaborative, efforts will focus on the following areas with a goal of providing data our members need to address the health equity issues pertinent to the communities they serve. Premier’s role will be to act as a convener of three specific areas to provide solutions: + Real-world evidence councils (RWECs) and ideation labs to engage patients and community: • Engage to gather insights, foster peer-to-peer knowledge sharing, and center patient and community voices. • Build capacity of patients for inclusion as subject-matter experts. • Include a seat on any RWEC for patient voices. • Develop white papers and webinars to disseminate learning across member network. • Cocreate solutions. + Research and dissemination to improve equity outcomes: IMPROVING PATIENT OUTCOMES • Support collection of accurate equity-related drivers of health data. Develop dashboards. AND LOWERING COSTS • Study what works. Share insights on strategies that advance equity that are scalable and sustainable. Premier plays a critical role in the rapidly evolving healthcare industry by collaborating with members to co-develop • Assist with implementation of clinical transformation with a focus on advancing equity. long-term innovations that reinvent and improve the way care is delivered to patients nationwide. With our differentiated combination of integrated data and analytics, collaboratives, supply chain solutions, and advisory and other services, we • Improve delivery of care using real-world and community-informed evidence. are uniquely positioned to enable better care and outcomes at a lower cost. • Integrate patient, partner, family and community voices. In order to strengthen our ability to have a positive impact, we apply our comprehensive technology and services • Commit to disseminate and share results with patients and communities. platform, PINC AI™, with its more than 20 years’ worth of quality, cost and operational data points gleaned from more than 45% of U.S. hospital discharges as well as approximately 812 million hospital outpatient and clinic encounters and + Clinical trials to increase representation and diversity: nearly 132 million physician office visits. PINC AI provides a unique opportunity to use real-world data to conduct • Identify populations that are underrepresented proportionate to burden of disease in clinical trials. evidence-based and population-based analyses of drugs, devices, treatments, disease states, epidemiology, resource utilization, healthcare economics and clinical outcomes. PINC AI delivers robust, real-world data to drive informed • Design and implement strategies that increase representation of patients proportionate to burden of disease. decisions that are actionable to improve quality, lower costs, reduce risks, and help ensure patient safety. • Facilitate multisite participation to increase access to clinical trials. 26
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management diverse hospitals from every state and the District of SUPPORTING IMPROVING HEALTH Columbia, largely caring for the underserved to THE MEDICALLY THROUGH COMMUNITY implement and scale standardized, evidence-based practices to identify and reduce factors that are proven UNDERSERVED DEVELOPMENT to contribute to adverse outcomes. To advance our mission, we provide our members with We aim to lead the transformation to high-quality, many of the tools needed to support the communities in cost-effective healthcare by supporting the medically EMPLOYEE COMMUNITY OUTREACH which they operate. We also believe it is our social underserved throughout our communities. Through our responsibility to do our part in directly improving the data and analytics capabilities, collaboratives, and other In collaboration with our ERGs, our businesses focus health of communities. In this spirit, community tools, we help healthcare providers better understand on several initiatives that help us drive our mission development is one of the four strategic pillars of our underserved populations, the severity of health-related to improve the health of our communities, including: DEIB strategy. We drive coordinated organizational problems, and the root causes of disparate outcomes, community development initiatives to address the root + The Women and Maternal Health Initiative – In connecting providers to best practices and care bundles causes of social determinants of health disparities such partnership with HHS, identify areas of opportunity to for remediation. Some of the initiatives we have in place as social justice, education, nutrition, poverty, maternal recognize health issues for women of all backgrounds to help address the medically underserved include health and homelessness. to ensure better birth outcomes. those dedicated to maternal health, opioid abuse, disparity gaps, social determinants of health, and We deliver upon our social responsibility through + Health Equity Planning Council – Identify the areas in chronic health conditions. financial donations and employee volunteer efforts to which Premier can best support members using data support nonprofits dedicated to improving community and evidence-based research to solve health equity health. Our employees care about taking responsibility to issues in member communities. IMPROVING MATERNAL HEALTHCARE contribute to our mission because, by virtue of our IN UNDERSERVED COMMUNITIES + Premier Employee Food Security in the Community footprint, we live in the communities we serve. We We are partnering with the U.S. Department of Health Initiative – Engage employees in their local believe that our commitment to support these nonprofit and Human Services (HHS) Office on Women’s Health communities to help solve hunger, malnutrition, organizations in helping the underserved is a (OWH) to work toward a better understanding of the nutrition education and food deserts. cornerstone of our mission and social responsibility. current state of maternal-infant harm and death to + Community Outreach Talent Initiative – Intentionally improve the quality of care, particularly in hospitals that connect and build relationships with schools, colleges, serve vulnerable populations. OWH is leveraging our affinity organizations, and other communities of talent data to scientifically examine the root causes of to support hiring interns, employees, and other types maternal-infant mortality and morbidity, including of talent to help diversify our employee base and significant and persistent racial and ethnic disparities, mollify the challenges caused by talent shortages. and translate these findings into evidence-based care delivery. This effort unites a cohort of more than 200 27
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management Our Social Responsibility Program reflects our commitment to nurturing the communities in which we live OUR SOCIAL and work. Since launching our Social Responsibility Program in 1998, Premier employees have supported local and national organizations, global nonprofits and each other through various volunteering efforts and financial RESPONSIBILITY donations. The program’s framework includes volunteering and financial support for those organizations and causes important to our employees during FY2022, as outlined. PROGRAM Volunteering During Work Hours Corporate Gift-Matching We provide each employee up to four hours of paid time off to volunteer Employees may also contribute toward a monthly Jeans Days to support an quarterly. In FY2022, employee volunteer hours totaled 329. employee-nominated, national healthcare-related charitable organization, such as COVID-19 relief efforts. In CY2021, our employees donated nearly $28,950 Volunteering Outside Work Hours through this program to the following organizations: For every eight hours an individual employee volunteers during non-work January Hands for Holly Memorial Fund hours, we will donate $100, up to a maximum of $200 per employee per February American Heart Association fiscal year, to the charitable organization. In FY2022 we donated $2,700 to various charities to match our employees’ volunteer support. March Autism Speaks April The Guthy-Jackson Charitable Foundation Corporate Gift-Matching May Child’s Play Employees may donate a minimum of $50 to an eligible charitable June Barbells for Boobs organization to receive a 50% matching gift up to $2,500 per employee per fiscal year. Last year, we matched $130,315 of our employees’ charitable July Neuroendocrine Tumor Research Foundation donations. Additionally, over $35,000 was donated between employees and August Huntington’s Disease Society of America employer gift-matching to benefit disaster relief efforts for Kentucky September CurePSP tornado victims and Ukraine. October Scott Hamilton CARES Foundation We believe it is important to be a good neighbor. ERG Social Responsibility Initiatives November JDRF (Juvenile Diabetes Research Foundation) We encourage employees to volunteer with various In total, our ERGs helped spur donations of $17,800 to the Wounded nonprofits and give back via our corporate polices as December Dogs for Better Lives ® Warrior Project and helped raise $368,405 for Family Reach as well as mentioned in the above chart. We also have many ERGs over $1,000 for Stop AAPI Hate. ERG donations also provided over 3,200 and corporate-sponsored charitable events. Our largest items for the North Carolina USO Snack Pack drive. For more information, event this year was a hands-on half-day event for the please see the ERG section of this report. nonprofit Crayon Initiative. The Crayon Initiative supports over 240 hospitals across the U.S., many of whom are Premier members, by collecting used crayons and recycling them into new ones that are uniquely designed to be easier to hold and not roll off tables as children are receiving treatment or coloring in their hospital beds. Our amazing efforts were a great first step in The Crayon Initiative’s recycling process. 28
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management 2022 The BreakAway PREMIER CARES AWARD A nonprofit to help women recover from the disease of addiction.* Each year, we present the Premier Cares Award to recognize exemplary efforts by nonprofit community organizations to improve the health of populations in need. We have presented the Cares Award annually 2021 since 1991, when it was created by Dr. Monroe E. Trout, Community former CEO of American Healthcare Systems, one of our Enhancement Collaboration, Inc. heritage organizations. Applications for this $100,000 award are rigorously judged on innovation, outcomes, A nonprofit dedicated to ease of replicability, financial impact, and future vision. eradicating food insecurity. We honor qualifying programs that support populations excluded from, or underserved by, the mainstream health delivery system. 2020 Call to Freedom A nonprofit focused on navigating a healthy path for CARES AWARD CRITERIA victims of human trafficking. + Suffer severely limited access to medical, dental or mental 2019 healthcare providers. Lifehouse Maternity Home + Bear high infant mortality. A nonprofit for high-risk pregnant + Face low income and women and their babies. extreme poverty. + Experience high levels of drug abuse. 2018 + Are economically or Hildegard House medically vulnerable. A nonprofit providing a home and + Possess a unique care need that is not compassionate care for individuals at the end of life. being met through traditional means. * Please visit our Newsroom for further information on the 2022 Care Award recipient. 29
IN THIS SECTION SUPPLY CHAIN SERVICES ETHICS AND COMPLIANCE PRODUCT QUALITY AND SAFETY ENVIRONMENTAL CONSIDERATIONS IN SUPPLY CHAIN SUPPLIER DIVERSITY SUPPLIER RESILIENCY AND DISASTER RESPONSE We believe we play a critical role in the rapidly evolving healthcare industry, collaborating with members and other customers to co-develop long-term innovative solutions that reinvent and improve the way care is delivered to patients nationwide. 2022 HIGHLIGHTS + Maintained a portfolio with over 3,000 contracts and more than 1,460 suppliers through our GPO for a total purchasing volume of more than $82 billion in CY2021. + Gathered extensive information from our suppliers on environmentally preferable policies and practices, guided RESPONSIBLE by our Environmentally Preferred Purchasing (EPP) Advisory Council. + 11% of our contract portfolio was comprised of diverse suppliers and included agreements with diverse companies and small business enterprises in FY2022. SUPPLY CHAIN
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management Our supply chain approach is designed to provide our members with valuable access to scale efficiencies, actionable data intelligence and information resources to help them deliver higher-quality and more cost-effective healthcare. We believe that our partners throughout the supply chain rely on our integrity, expertise and professionalism. We aim to provide our members with high-quality products and services at the lowest price, and suppliers count on us to maintain competitive bidding processes that are fair, timely and understandable. We partner with a third-party supply chain management GPO Supplier Selection Process severely limited access to medical, GROUP PURCHASING provider for ongoing supplier and site assessment and Sourcing Committees ORGANIZATIONS monitoring of a broad range of environmental and social SUPPLY CHAIN We facilitate service line-specific sourcing On behalf of our members, we negotiate over 3,000 issues, including identifying chemical spills; committees to determine which suppliers are awarded SERVICES contracts with more than 1,460 suppliers through our environmental hazards; regulatory changes; labor group purchasing contracts. More than 430 individuals GPO, providing our members with access to a wide disruptions or violations; fines; legal actions; and actions – collectively representing more than 135 of our U.S. Our Supply Chain Services business supports our range of products and services, including medical and under the FDA, European Medicines Agency (EMA), or hospital members – sit on one of our 29 strategic members in managing their non-labor expenses and surgical products, pharmaceuticals, laboratory supplies, Occupational Safety and Health Act (OSHA). We also sourcing committees. These committees advise on capital spend through a combination of products, capital equipment, IT, facilities and construction, food incorporate risk scoring into our supply chain ways to improve the development, quality and value services and technologies. These include our GPO and nutritional products, and purchased services (such management processes to analyze trends, identify risky of our products and services. serving acute, non-acute and non-healthcare, supply as clinical engineering and document shredding suppliers or parts, and mitigate risks where possible. chain co-management, and direct sourcing activities. Clinical Councils and Selection Criteria services). Total purchasing volume by all GPO members For more information on our supplier selection criteria, Our supplier selection criteria vary by category and are was more than $82 billion for CY2021. Supply Chain Services leverages the collective buying please visit the Suppliers page on our website. created by our internal Clinical Councils with member power of our members that represent many of the Through our GPO programs, we aggregate member subject-matter expertise on the product category being country’s most progressive and forward-thinking purchasing power to negotiate pricing discounts and reviewed. Our Clinical Councils are comprised of healthcare organizations. The participation of these DIRECT SOURCING improve contract terms with suppliers. We do not take multidisciplinary members with backgrounds including healthcare providers gives us additional insights into title to the underlying equipment or products purchased pharmacy, laboratory, nursing, surgical and We offer our members the opportunity to purchase industry challenges and innovative best practices that by members through our GPO supplier contracts. cardiovascular areas. Clinical Councils establish the core products that are directly sourced in the healthcare we can share broadly. evaluation framework that best accounts for safety space through our subsidiary, S2S Global (S2S), primarily Our contracting process is guided by what we believe is regulations, clinical trials, product reviews and applicable Our contract portfolio includes more than 540 distinct for commodity items such as patient gowns, exam the industry’s most comprehensive GPO Code, which certifications related to key assessment factors such as: supplier partners in over 300 categories. These suppliers gloves, lab coats, masks and incontinence products. supports healthy competition while encouraging new manufacture in diverse locations outside of China, We believe that our direct sourcing activities help our + Quality + Environmental impact and innovative products to enter the market. Our including in the United States, elsewhere in North members and other customers access a diverse product sourcing process ensures that factors beyond price are + Safety + Diversity America, South America, Europe, Africa and other parts portfolio and provide transparency related to given serious and appropriate consideration. Clinical + Clinical impact + Breakthrough potential of Asia. Premier is committed to contracting with manufacturing costs and competitive pricing. We efficacy and improved patient care are especially + Cost effectiveness + Member input suppliers that demonstrate manufacturing resiliency, market our direct sourcing activities primarily under the important to us and to our members. ® redundancy and quality investments while also adhering + Physician preference PREMIERPRO brand. to our labor law policies. 31
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management and, through them, the patients and communities they evaluation of potential risks is monitored by our Legal ETHICS AND PRODUCT QUALITY serve. Foremost among those interests are good clinical and Compliance departments. Our anonymous third- COMPLIANCE AND SAFETY outcomes for patients and cost effectiveness in care party reporting portal, Premier’s WorkSmart Integrity processes and resource utilization of supplies, Helpline, is available to anyone to report unethical Integrity forms the basis of our successful business We act as a trusted connection point for healthcare pharmaceuticals and equipment. behavior, misconduct, and suspected criminal or operations and underpins all our business relationships. providers, suppliers and the government by seeking illegal activity. Our members rely on our integrity, expertise and to promote access to safe, high-quality products We seek to act ethically, accountably and fairly with professionalism to receive the best products and throughout our supply chain. respect to all participants in the healthcare marketplace. services at the lowest price. Likewise, suppliers count on Each GPO is bound by the terms outlined in our GPO VENDOR GRIEVANCE PROCESS us to maintain competitive bidding processes that are Code. During CY2021, 100% of our GPO Member SECURE PRODUCTS AND SERVICES fair, timely and understandable. Our success is firmly rooted in developing mutually Committee participants completed their annual conflict beneficial relationships with our vendors. We take Premier is committed to providing secure products of interest attestations. All suppliers are expected to uphold our high standards vendor grievances seriously and offer several ways to and services that meet compliance and reporting and comply with their responsibilities and obligations resolve possible issues. We have our own vendor In addition, it is the responsibility of all sourcing needs. We share our best practices and provide easy when doing business with us, including responsible grievance process to ensure a vendor’s ability to access committee and advisory subcommittee members to access to compliance documentation. Premier’s business practices related to human rights and anti- our contracting staff and leadership to address concerns administer our corporate matters honestly and efficiently security, third-party audits and certifications, bribery and anti-corruption standards. For more or complaints relating to the contracting award process and to exercise the best care, skill and judgment for the documentation, and legal commitments help support information, please see the Supplier Standards and or decisions. Concerns, grievances and complaints are benefit of our company, consistent with our ethical customer compliance and products regularly undergo Suppliers sections of our website. reviewed by the Vendor Grievance Review Panel. Their standards. For more information, please see our independent verification of their security, privacy, and recommendations and suggested courses of action Member Committee Conflict of Interest Policy . compliance controls, achieving certifications, During FY2022, we improved our vendor management (after approval by a member sourcing committee) are attestations of compliance, or audit reports against with a centralized risk management and compliance considered final. stringent standards. As a part of the independent cloud-based platform. The solution provides advanced S2S GLOBAL COMPLIANCE verification process, third-party auditors examine our capabilities to ensure vendor compliance with laws In addition to our vendor grievance process, a vendor end-to-end security practices, including data centers, and regulations. Given the global footprint of our contract manufacturing may request further review of any outstanding concerns infrastructure and operations, at a regular cadence. suppliers, our corporate social responsibility practices at through the Healthcare Group Purchasing Industry S2S are paramount. S2S has adopted strong anti-bribery Initiative (HGPII) Independent Evaluation Process, GPO AND MEMBER standards and seeks to identify and prevent the ® facilitated by the American Arbitration Association COMMITTEE COMPLIANCE occurrence of forced labor and human trafficking in our (AAA). For CY2021, there were no grievances filed by supply chain through training. In CY2021, 100% of S2S In providing our group purchasing services, we serve the suppliers. For more information, please see our employees and other personnel who work with S2S interests of our member hospitals and health systems Vendor Grievance Policy. completed this education. An ongoing internal 32
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management found to be defective, could pose a risk to health, or are capabilities are facilitated throughout the supply chain regulations. We offer supplier contracts for members GPO QUALITY AND in violation of FDA regulations. This includes notification fulfilment process by utilizing identifiers on packaging with three DSCSA track-and-trace technology solutions SAFETY ASSURANCE to the FDA as well as collaboration with our GPO and (both inner and outer) such as printed lot numbers, date to assist our members in assuring the integrity of the Our GPO operational contracting analysis is designed to subject-matter experts to notify members, provide of manufacture, and unique device identifiers. S2S offers drug supply chain. ensure that products provided by GPO suppliers are support and advice regarding safety incidents or safety data sheets for some of the product offerings FDA-approved as required and perform as intended in a We contract with distributors that purchase recalls, and conduct follow-up checks to assure provided to members. It also provides customer training safe and effective manner. Several resources are used to pharmaceuticals for our GPO members directly from successful resolutions. and counseling for all product offerings to members. gather information about products, including the manufacturer, thus minimizing the chance for randomized controlled trials published in peer-reviewed diversion or counterfeiting. In addition, with respect to professional journals, case studies, market guides or S2S QUALITY ASSURANCE AND COUNTERFEIT DRUGS 503B suppliers that are under contract with Premier and product comparisons, field trials, clinical staff surveys, TRACEABILITY IN DIRECT SOURCING AND TRACEABILITY supply drug-shortage products to our members, we have quality monitors, customer satisfaction data, and a process whereby we inspect each supplier over the The Quality Assurance program for our S2S direct Our portfolio of pharmacy contracts covers more than financial data. In addition, our GPO may evaluate course of the life of the contract. sourcing option incorporates industry best practices to 180 pharmaceutical suppliers and over 15,000 products product-related information involving patient and worker deliver high-quality products, traceability and tangible distributors that are authorized to do business with our If a healthcare provider has a question or concern safety as well as environmental issues. The Premier savings. S2S’s internal Quality Assurance team, along suppliers. Distributors engaged in known gray-market about a pharmaceutical product they purchased from GPO does not independently test any products. with the Quality Inspection team from our overseas activity (e.g., selling Premier private-label products when the manufacturer or wholesaler/distributor and that exclusive sourcing agent, conduct both supplier and they are not under contract with Premier) or price concern is shared with us, we put that provider in touch product validation throughout the manufacturing gouging on shortage-impacted drugs will not be RECALL POLICIES AND PROCEDURES with the appropriate individuals to discuss the concern process. Members conduct product validation and awarded a contract with us. and any appropriate action that needs to be taken. Our Quality and Safety assurance begins with the initial pre-production evaluation via our S2S Clinical supplier bid submission. During the kickoff stage of our Through our pharmacy program, we contract with Committee. Member feedback also drives product In addition, we are on a variety of FDA and other industry Supplier Selection Process, we require that each supplier manufacturers of both commercially manufactured improvements throughout the contract cycle. mailing lists and receive immediate notification of any disclose information related to product category pharmaceuticals and 503B-manufactured pharmaceutical recalls. This allows us to understand the regulations, including FDA inspection and clearance. Supplier validation includes third-party auditing covering pharmaceuticals. These manufacturers either deliver nature of the recall, if it is a product and/or manufacturer Additionally, each supplier must provide its recall policies manufacturing specifications and facility capabilities their products directly to the healthcare provider or ship with which we are under contract, and if there is a need and procedures, including management of recall (e.g., ISO 9001, ISO 13485, GMP, etc.). Products are through authorized wholesalers and distributors who to take action. notifications, customer engagement, order substitution, inspected during production through random sampling abide by Drug Supply Chain Security Act (DSCSA) and expectations regarding turnaround-time thresholds. prior to shipment and via inbound and random regulations for tracking and tracing the ownership and Our members are alerted to shortages, recalls and other This information is reviewed by our service line-specific distribution center inspections to monitor product delivery of pharmaceuticals. Upon receipt, the provider safety incidents through a weekly pharmacy newsletter. Sourcing Committees and Clinical Committees. quality and consistency over time. of a pharmaceutical product can track its movement Time-sensitive updates on pharmaceuticals are provided throughout the supply chain. Our members and to members through email. Contracted suppliers are expected to comply with FDA S2S will develop and deploy formal internal product contracted distributors abide by DSCSA rules and requirements for actions to be taken related to products portfolio training for all S2S employees as it relates to (medical devices, drugs, biologic products) that are product quality and product safety. Traceability 33
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management Our sourcing process includes questions about the TRANSPORTATION AND LOGISTICS SUPPLY CHAIN existence of chemicals of concern, recyclable or We provide our GPO members with direct sourcing recycled packaging, and responsible product resources. ENVIRONMENTAL options through our subsidiary, S2S. While most of The Chemical Footprint Project (CFP) provides an these direct-sourced items are produced by suppliers CONSIDERATIONS independent assessment solution to help track and in Southeast Asia, we continue to explore opportunities encourage the use of safer chemicals. As a CFP We are committed to supplying our members with to create a more resilient healthcare supply chain by signatory, and through the support of our individual products that support the health of their patients, staff partnering with healthcare providers and suppliers to members, we help accelerate the adoption of safer and communities. As part of this commitment, our increase domestic and near-shore production of PPE and environmentally sustainable chemicals by Sourcing Committees include data on environmental and other critical supplies. industry suppliers. impact in their contracting decisions. Enabled by our We rely on third-party transportation providers who use data-driven approach, forward-thinking supply chain Recent updates to our supplier questionnaires include fuel and energy on our behalf to transport our directly teams are driving continued green innovations in questions specifically addressing suppliers’ Scope 1 and sourced goods via various modes of transportation, healthcare that cut costs over the long-term, reduce Scope 2 emissions. These include whether suppliers are including air, ocean and road. We take a holistic environmental impact, and minimize negative measuring their emissions and reporting them publicly, if approach to optimize delivery efficiencies between our consequences on public health. they have been independently verified, and what their members and suppliers. emission reduction plans are. We expect the data we obtain to help Premier support its suppliers as well as its ENVIRONMENTAL members on their path to net zero. ASSESSMENT PROCESS Contracted products with environmental attributes We work with suppliers to ensure that environmental are highlighted in our product catalog for use by our sustainability information is made available before member health systems as part of our work to integrate purchasing decisions are made. We request extensive critical environmental impact data for medical and information from our suppliers on environmentally non-medical products into the purchasing process preferable policies and practices and are guided by our for hospitals, health systems and other Environmentally Preferred Purchasing (EPP) Advisory provider organizations. Council. The EPP Advisory Council is comprised of sustainability, supply chain and facilities specialists from a cross-section of member health systems. It reviews and advises on upcoming contracts from a sustainability perspective. The EPP Advisory Council also acts as a forum for members to discuss best practices to promote sustainability in healthcare, solve common challenges, and drive continuous improvement. 34
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management We also work with member health systems to advance their We employ eco-friendly practices at our leased SUPPLIER DIVERSITY PROGRAM own sustainability initiatives in a cost-effective and efficient distribution centers in Riverside, California, We appreciate the challenges that minority- and women- way, utilizing environmental analytics in the contracting and Charlotte, North Carolina: Premier’s GPO portfolio includes owned companies and small businesses have with reach process and offering a database with environmental and and access, therefore we created a Supplier Diversity + Cardboard and pallets reused human health impact data integrated at the product level. ~340 contracts Program to provide them the opportunity to partner for multiple shipments. We support members pursuing the elimination of chemicals with diverse companies and small with us. of concern from certain product categories in accordance business enterprises representing + Energy-efficient bulbs and natural light used with industry guidelines established by Practice Our Supplier Diversity Program supports our members by: throughout our facilities. 250+ suppliers. Greenhealth and HAN. Other member programs we help support include: + Ensuring that diverse suppliers are proactively + Electric forklifts used for loading and unloading. considered for contracting opportunities. In CY2021, Premier members spent over + Reducing waste through reprocessing. + Electronic scanners utilized to reduce paper use. + Encouraging contracted suppliers to support $1 billion + Using products with recyclable packaging and content and procure from diverse suppliers. with diverse companies and small SUPPORTING business enterprises. + Decreasing greenhouse gas (GHG) emissions. + Supporting and facilitating procurement from SUSTAINABILITY INITIATIVES diverse suppliers. + Lowering energy usage through the purchase Recognizing that the enormous challenge of improving Premier’s FY2023 goals include: of energy-efficient electronics. healthcare’s environmental footprint can only be solved + Including diverse suppliers in our contract portfolio. by close cooperation, we foster ties with all concerned Developing Access to Capital Strategy to offer The program is also a strategic pillar of our DEIB strategy. parties. Premier is a Premier Affiliate Partner of Practice 1 diverse businesses a high-level assessment of Combining member purchasing data within our GPO For further information, please see the DEIB section of Greenhealth, the foremost NGO operating in the market opportunities and approaches. supply chain with our EPP supplier information allows our this report. healthcare sustainability space. We have also members to track and monitor compliance with their Enhancing coaching and mentoring to help collaborated closely with Healthcare Anchor Network environmental objectives and sustainability goals. 2 minority- and women-owned companies scale (HAN), providing feedback on how GPOs can support their Premier contract with our members and HAN’s dual objectives of supporting local economies THE SEEDS PROGRAM the healthcare industry. and furthering environmental justice. Through these SUPPLIER DIVERSITY efforts, we are working to address the healthcare Premier’s Sourcing Education and Enrichment for Diverse Helping potential incubations that have sector’s role in climate change. and Small Suppliers (SEEDS) program aims to increase the As an organization built on the foundation of transforming 3 validated market opportunity. number of small, diverse and regional enterprises doing healthcare within communities across the country, we business with members of our healthcare alliance. It lends recognize that supplier diversity is an important component Premier’s FY2023 annual incentive plan includes a support to diverse and small business enterprises of our members’ success. Diverse suppliers help our strategic goal focused on increasing member spend including, coaching, mentoring, business educational tools hospitals create jobs and improve life in the communities through diverse suppliers in our GPO contract portfolio. and a stair-stepped approach to help them develop and they serve. grow strategic long-term relationships. Recent updates to our supplier questionnaires include questions specifically addressing suppliers’ Scope 1 and Scope 2 GHG emissions. These include whether suppliers are measuring their GHG emissions and reporting them publicly, if they have been independently verified, and what their GHG emission reduction plans are. We 35 expect the data we obtain to help Premier support its suppliers as well as its members on their path to net zero.
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management Hurricane Center (NHC), and the appropriate State In CY2021, Premier convened a member-led cohort to need to serve their patients. Guided by our member SUPPLIER RESILIENCY Emergency Management Agency during disasters. The begin developing strategies to rethink and rapidly evolve health systems, including our National Pharmacy communication about these events and disasters is AND DISASTER our inclusion, award and development criteria. We Committee, we are bringing an increased supply of distributed across our membership and posted to our believe that rising tides lift all boats and that all generic drugs back to market to fill hospitals’ critical RESPONSE Disaster Response Communities site. organizations in the supply chain must have aligned needs and help alleviate the drug shortage. Through our We have a program in place designed to promote goals and objectives so our entire industry can national drug initiatives, we have helped supply domestic and geographically diverse manufacturing and successfully address these long-standing inequities members with nearly 150 shortage drugs. Specifically, ® ensure a robust and resilient supply chain for essential across the nation. To demonstrate our collective we created ProvideGx to invest in innovative new medical products. It is intended to provide a means to commitment to action, Premier has begun propelling business models and partnerships to address drug The global supply chain continues to invest in businesses that can supply shortage products, this incredibly important initiative. shortages, including partnering with high-quality generic experience unprecedented disruptions, co-fund the development of affordable products that drug manufacturers that can supply shortage products, On a combined basis, our diverse supplier purchasing address specific market needs and create strategic which are affecting multiple economies co-funding the development of affordable products spend grew 4% in CY2021 compared with CY2020. In sourcing contracts to ensure continuous supply. We that address specific market needs, and securing and industries, including the U.S. CY2021, our diverse suppliers enjoyed 4% year-over-year believe this program is most successful when we can contracts for active pharmaceutical ingredients to healthcare industry. The rising costs of growth in purchasing spend compared to CY2020. We partner with our members on these initiatives, such as: ensure a continuous supply as well as strategic continue to evolve our strategies to focus on sourcing agreements. energy, transportation, food and labor + Partnered with our members to invest in Prestige socioeconomic development and growth of and the Russia-Ukraine War present Ameritech, a domestic manufacturer of masks and communities through minority- and other PPE, for a direct source of critical supplies. women-owned businesses. DISASTER RESPONSE additional challenges. Within this COMMUNITY TEAM + Created a joint venture with our members dynamic environment, Premier We believe the increased use of our Supplier Diversity Our dedicated Disaster Response Community team and DeRoyal Industries, Inc., a global medical Program will drive better healthcare outcomes, continues to arm our members with the ensures business continuity for our members during a manufacturer dedicated to the domestic strengthen local economies, and develop a more robust information, tools and support needed to hurricane, fire, tornado or other emergency. We serve as production of isolation gowns. supplier-diversity ecosystem for the healthcare industry. an extra set of hands and legs operating as conduits for To further support and expand our Supplier Diversity tackle cost imperatives and provide vital + Collaborated with Honeywell to expand information and preparedness. Our team constantly Program, Premier is a corporate member of the supplies to care for patients. Our team U.S. production of nitrile exam gloves. monitors all areas of the U.S. for earthquakes, wildfires, following advocacy organizations: hurricanes and other disruptive events that could remains committed to supporting + Partnered with leading health systems to invest in + National Minority Supplier Development Council potentially affect our members, suppliers or employees. Exela Pharma Sciences, LLC, to support U.S.-based healthcare providers and suppliers in We are frequently in contact with local, state and drug supply and manufacturing. + Women’s Business Enterprise National Council national government organizations such as Federal finding innovative ways to solve these Emergency Management Agency (FEMA), Cybersecurity We also partner with health systems to find ways to issues and enable health systems and + Healthcare Supplier Diversity Alliance and Infrastructure Security Agency (CISA), National deliver critical drugs that pharmacists and clinicians other healthcare providers access to + Healthcare Group Purchasing Industry Initiative critical supplies. 36
IN THIS SECTION MANAGING OUR CLIMATE IMPACT A healthy planet means healthy people. As a healthcare improvement company, we strive to reduce our environmental impact and are continually working toward sustainable business operations. 2022 HIGHLIGHTS + Conducted our inaugural greenhouse gas (GHG) assessment, baselining our carbon footprint by calculating our Scope 1 and Scope 2 emissions for FY2020 and FY2021. + Worked to develop a cadence of data collection from our property managers to enhance our future GHG assessments and better understand the impact of gas, power and water consumption at our facilities. + Developed an Environmental Policy Statement to signal full commitment to our sustainability initiatives to our internal and external stakeholders. ENVIRONMENTAL + Reduced our operational footprint by subleasing two facilities with a third facility being marketed for sublease and successfully repurposed or recycled over 90% of furniture, fixtures, IT equipment and other supplies from these facilities as our MANAGEMENT employees transitioned to fully remote work.
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management We are committed to protecting and enhancing the environment. As part of our efforts to improve the health of our nation’s communities, we pursue our mission as prudent stewards of the environment. We strive to identify products and services that not only help our members to protect the environment (as discussed in the section on Responsible Supply Chain) but also seek to integrate environmentally friendly practices into our own operations. The results of Premier's GHG assessment are shown MANAGING OUR 1 in the table to the right. U.S. EMISSIONS (IN MTCO E ) 2 CLIMATE IMPACT EMISIONS CATEGORY FY2020 FY2021 Based on our assessment, we found that approximately Premier recognizes that human health is inextricably 43% of our Scope 1 and Scope 2 emissions are from our Scope 1 Emissions 424.61 437.56 linked to the planet’s health. Climate change has and collocated data centers, while our corporate will continue to increase the incidence and complexity of 2 Location-based Scope 2 Emissions 2,052.46 2,012.81 headquarters in Charlotte comprises about another 28% many health issues like asthma, especially in vulnerable of emissions. Our total Scope 1 and Scope 2 emissions 3 Market-based Scope 2 Emissions 1,645.89 1,595.56 and disadvantaged populations. Climate change is also decreased from FY2020 to FY2021, primarily driven by expected to trigger physical and economic impacts, Total Scope 1 and Location-based reduced electricity consumption in Premier’s 2,477.06 2,450.37 including infrastructure and supply chain disruptions. Scope 2 Emissions headquarters building and a reduction in overall operating space. We also reduced our GHG intensity We are cognizant of our duty to reduce the Total Scope 1 and Market-based 2,070.50 2,033.12 by revenue between FY2020 and FY2021. For more environmental impact of our operations in a fiscally Scope 2 Emissions information on how we are reducing our energy responsible manner and are taking steps to shore up consumption from our corporate offices and data Location-based GHG Intensity by Floor our own resilience and adaptability, as detailed in the 6.53 6.50 centers, please see the Energy Management section Area (MTCO e/1,000 square feet) Environmental Considerations in Supply Chain section 2 of this report. of this report. We are utilizing a phased approach to Location-based GHG Intensity by understand our baseline impact as an organization, 1.91 1.42 Premier faces certain limitations in reducing its Scope 1 Revenue (MTCO e/$1 million) establish effective governance and oversight structures, 2 and Scope 2 emissions as all our offices are leased. and identify the next steps to take to do our part in a Nevertheless, we will seek to continue to consolidate 1 Metric Tons of Carbon Dioxide equivalent. Total emissions numbers may not sum due to rounding. transition to a low-carbon economy. our real estate portfolio where feasible and partner with 2 Location-based emissions are those estimated based on local grid power sources. 3 Market-based emissions are those estimated after factoring in power purchase agreements and renewable energy certificates. our landlords to integrate environmentally friendly practices. We also recognize that our business in supply GREENHOUSE GAS ASSESSMENT chain services means that measuring our Scope 3 This year, Premier engaged an external consultant to Premier's 2021 Location-Based emissions will be integral to reducing our carbon Emissions Breakdown baseline our FY2020 and FY2021 greenhouse gas (GHG) footprint. We plan to calculate and report on Scope 3 emissions. Scope 1 and Scope 2 GHG emissions, as categories in the future. defined below, were calculated for our U.S. offices and stakeholders to develop a carbon reduction strategy and data centers: We are striving to standardize our processes to improve Data Centers - 42.7% goals, evaluate carbon offset options, align with the Task data collection for our greenhouse gas assessment, Scope 1 – direct emissions from Premier-owned Premier HQ (Charlotte) - 27.8% Force on Climate-Related Financial (TCFD) framework in closing data gaps to enhance year-over-year reporting. or controlled assets. future sustainability reporting, and complete the CDP Using the insights gleaned from the initial baseline GHG Other Facilities - 29.4% (formerly the Carbon Disclosure Project) questionnaire. assessment, we also plan to collaborate with our Scope 2 – indirect emissions from purchased electricity. 38
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management Premier’s HQ in Charlotte, North Carolina is LEED-CS Gold Certified, ENERGY STAR Certified and WELL Health-Safety Rated. ENVIRONMENTAL POLICY ENERGY MANAGEMENT ONGOING EFFORTS We incorporate LED lighting requirements in all new AT OUR CHARLOTTE HQ AT OTHER FACILITIES leases that cover future build-out or space renovations This year, Premier developed and published an and install motion-sensor lighting with auto-shutoff Environmental Policy to continue to build organizational Our HQ building is managed by Northwood Office and is At our other office facilities, we have taken several steps features when possible. We also work with our landlords ® alignment on environmental issues. The policy was LEED -CS Gold certified, with LEED-CI principles applied to promote energy conservation. Premier has occupancy to provide special parking for fuel-efficient cars, electric affirmed by Premier’s Board and senior management within the interior build-out design. Northwood utilizes sensors in most of our office locations, allowing us to vehicles and carpools. In addition, when scheduling ® and represents a clear step toward a broader Trane Tridium Niagara Framework technology for its reduce power consumption if there is no occupancy on external meetings and conferences, we strive to pursue climate strategy. energy management system. the floors or in the buildings. We are currently evaluating contracts with facilities that integrate green offerings converting our light switches to light sensors in our within their building operations and customer service, For the second straight year, Northwood Office also Washington, D.C. location. In addition, our landlord at our such as recycling and water and energy conservation. ENERGY MANAGEMENT received the 2022 ENERGY STAR Partner of the Year Hudson, Ohio location is evaluating our space and other Award from the U.S. Environmental Protection Agency As a national organization, we seek to optimize our tenant spaces in the building for conversion to light and the U.S. Department of Energy. To earn the energy usage across our operations. Where feasible, sensors, timers, and or LED fixture replacements with ENERGY USE FOR DATA CENTERS certification, Northwood Office made several we support a remote work environment for our projected timeline of FY2023. We currently have an enhancements to our HQ, including: We eliminated our on-site data center from our HQ in employees. Today, most of our employees are fully ongoing initiative to replace all interior lighting with LED 2019, which reduced our equipment and related annual remote, lowering our energy demands and decreasing bulbs where possible and provide LED fixtures for any + Optimized the building HVAC run times, setpoints power needs by nearly 40%. By switching to colocated our carbon footprint. To that end, we are also piloting a fixture replacements. and staggered starts via the Building Automation data centers, we leverage economies of scale offered hybrid work schedule in which employees may elect a System (BAS). by third-party data center providers to maximize Where applicable, in conjunction with our property combination of work from home, work in a Premier energy efficiency and minimize electricity-related management teams, Premier participates in electricity office, or work elsewhere. + Serviced all HVAC equipment three times a year GHG emissions. curtailment events. During these events, Premier through preventative maintenance contracts with We lease all our office space, including our corporate turns off any devices that are not in use and top-rated mechanical contractors. Moreover, the third-party data center providers are headquarters (HQ) in Charlotte, North Carolina, and nine minimizes lighting to only what is necessary evolving to integrate ESG considerations and reduce smaller satellite office locations across the U.S., two of + Continued its commitment to installing only LED for safety and productivity. their own operational footprints. Premier’s primary which are subleased through the remaining lease term. lighting since 2017, resulting in a 100% conversion production data center in Culpeper, Virginia, is 100% rate to LED. covered by Renewable Energy Certificates (RECs) from U.S. wind Virtual Power Purchase Agreements (VPPAs) ® and Green-e wind RECs. 39
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management WASTE AND WATER ELECTRONIC WASTE RECYCLING We are environmentally conscious in the acquisition, Electronic waste (e-waste) recycling is an ongoing use, maintenance, reuse, recycling and disposal of process, and we have recycled over 12 tons of IT products and services used throughout our operations. equipment in the past six years. We are a member of We work with our landlords and suppliers to implement e-Stewards Enterprise, which recognizes electronics eco-friendly best practices as part of advancing our recyclers that meet certified standards for responsible environmental management strategy, such as: recycling practices. We also offer a computer drawing twice a year to our employees for the opportunity to + Requesting cleaning vendor partners to support purchase refurbished, previously used Premier “green” practices such as using eco-friendly products, computers with a portion of the proceeds being donated HEPA-filter vacuums, recycling implements, and to a nonprofit organization. energy- and water-efficient cleaning equipment. As we decommissioned our on-site data center in 2019 + Repurposing office furnishings to local charitable and transitioned to outsourced data centers, we recycled organizations, schools, churches, community and/or repurposed 49 server racks, 200 UPS batteries, organizations and our employees (by auction). 22 in-line CRAC (HVAC) units, a 1,000 kW Caterpillar generator and enclosure, and 5,800 pounds of copper As some of our employees have transitioned to fully cabling and piping. remote work, we have been able to reduce our operational footprint and sublease three facilities. During this process, we successfully repurposed or recycled WASTE REDUCTION over 90% of furniture, fixtures and supplies from these IN MEMBER HOSPITALS facilities. We were also able to repurpose or recycle Reducing waste produced by our members reduces 100% of our dedicated IT equipment from those facilities the impacts from the entire product lifecycle. We through qualified e-waste partners. facilitate waste reduction through the contracts we The facilities service company for our Charlotte HQ offer. Reprocessing, both as a standalone contract building was awarded the Cleaning Industry and in the form of blended codes, eliminates significant Management Standard (CIMS)-Green Building quantities of waste for our members. For example, Certification with Honors by ISSA, the World Cleaning one reprocessing contract alone at Premier saved a Industry Association. The award is given to those million pounds of waste from going to a landfill last companies that demonstrate a commitment to the year. We also offer items on contract, such as reusable delivery of environmentally preferable services designed waste disposal or sterilization containers, which have to meet customer needs and expectations. the potential to eliminate hundreds or even thousands of pounds of unrecyclable waste at any system that deploys them. 40
IN THIS SECTION ESG DATA TABLE SUSTAINABILITY ACCOUNTING STANDARDS BOARD (SASB) U.N. SUSTAINABLE DEVELOPMENT GOALS (SDGs) ESG MATERIALITY ASSESSMENT DEFINITIONS APPENDIX
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management ESG DATA TABLE For additional reference, the following table highlights key ESG metrics and resources related to our operations: FY2022 FY2021 FY2022 FY2021 1 ETHICS AND COMPLIANCE ETHICS AND COMPLIANCE Board ESG Oversight Nominating and Governance Committee Charter Government Relations Board Composition As of 10/19/2022 As of 10/20/2021 Total Employee Contributions: Total Employee Contributions: $109,114 $123,334 Total Directors 10 10 Political Contributions through Employee PAC Average Age (Years) 63 62 Total Political Contributions: Total Political Contributions: $56,500 $152,500 Average Tenure (Years) 5 5 Independent Directors (#) 9 9 Total Lobbying Expenditures $1,070,000 $3,540,000 Independent Directors (%) 90% 90% OUR PEOPLE AND CULTURE Women (#) 3 3 Total Head Count (#) ~2,600 ~2,600 Women (%) 30% 30% Total Employee Turnover Rate (%) 18% 11% Underrepresented Minorities (#) 1 1 Voluntary Employee Turnover Rate (%) 14% 9% Underrepresented Minorities (%) 10% 10% Involuntary Employee Turnover Rate (%) 4% 2% Employee Diversity 2021 Annual Compliance Report Total Employee Diversity (%) Code of Conduct Women 54.6% 53.3% Conflict of Interest Policy Asian 10.9% 10.7% Anti-Bribery Policy Ethics and Compliance Policies Black or African American 10.0% 9.6% Human Trafficking Policy Hispanic or Latino 3.6% 3.8% Whistleblower Policy White 72.3% 73.2% WorkSmart Integrity Hotline 2 Other 2.7% 2.7% Reports to 0 0 Whistleblower Hotline (#) 1 For additional information on Premier’s ethics and compliance programs and practices, please see the Ethics and Compliance and Types of Whistleblower Reports Not Applicable Not Applicable Governance Documents sections of our website. 2 Includes full-time employees who self-identify as Native Hawaiian, Pacific Islander, American Indian, Alaskan Native, or two or more races. 42
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management ESG DATA TABLE For additional reference, the following table highlights key ESG metrics and resources related to our operations: FY2022 FY2021 FY2021 FY2020 OUR PEOPLE AND CULTURE ENVIRONMENTAL MANAGEMENT 5 Diversity by Role (%) U.S. Greenhouse Gas (GHG) Emissions (MTCO e ) 2 Manager Level and Above Scope 1 Emissions 437.56 424.61 6 Women 51.7% 51.9% Location-based Scope 2 Emissions 2,012.81 2,052.46 7 Asian 7.6% 7.3% Market-based Scope 2 Emissions 1,595.56 1,645.89 Black or African-American 6.2% 5.7% Total Scope 1 and Location-based 2,450.37 2,477.06 Scope 2 Emissions Hispanic or Latino 3.2% 3.4% Total Scope 1 and Market-based 2,033.12 2,070.50 White 80.7% 81.4% Scope 2 Emissions 3 Other 2.1% 2.1% Location-based GHG Intensity Employees Eligible for 401(k) (%) 99.0% 99.0% by Floor Area (MTCO e/1,000 6.50 6.53 2 square feet) 100% of first 3% 100% of first 3% Employer 401(k) Match (%) Location-based GHG Intensity by and 50% of next 2% and 50% of next 2% 1.42 1.91 Revenue (MTCO e/$1 million) 2 Employee Resource Groups (#) 9 10 IMPROVING COMMUNITY HEALTH 3 Includes full-time employees who self-identify as Native Hawaiian, Pacific Islander, American Indian, Alaskan Native, or two or more races. 4 Total Charitable Giving $208,894 $278,751 4 Includes cash donations, matched donations, and Volunteer Hours Program. 5 Metric tons of carbon dioxide equivalent. Total emissions numbers may not sum due to rounding. Total Employee Volunteer Hours 329 288 6 Location-based emissions are those estimated based on local grid power sources. 7 Market-based emissions are those estimated after factoring in power purchase agreements and renewable energy certificates. RESPONSIBLE SUPPLY CHAIN Group Purchasing Code of Conduct Supplier Standards Contract Portfolio Comprised of Diverse Suppliers (including agreements with minority-, women- 11% 12% and veteran-owned companies and small business enterprises) (%) 43
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management SUSTAINABILITY ACCOUNTING STANDARDS BOARD The tables below incorporate accounting standards from the SASB related to Health Care Distributors (HC-DI) as well as relevant topics from Medical Equipment and Supplies (HC-MS) and Software and IT Services (TC-SI). It includes references to sections within this report where specific topics are discussed in further detail. SUSTAINABILITY DISCLOSURE TOPICS AND SUSTAINABILITY DISCLOSURE TOPICS AND ACCOUNTING METRICS: HEALTHCARE DISTRIBUTORS ACCOUNTING METRICS: HEALTHCARE DISTRIBUTORS SASB SASB SASB TOPIC ACCOUNTING METRIC RESPONSE SASB TOPIC ACCOUNTING METRIC RESPONSE CODE CODE We rely on third-party transportation providers who use fuel and energy on Description of methods and our behalf to transport our directly technologies used to HC-DI- sourced goods via various modes of maintain traceability of HC-DI- See the Counterfeit Drugs and Payload fuel economy. 110a.1 transportation and therefore do not products throughout the 260a.1 Traceability section of this report. have operational control of the fuel distribution chain and consumption needed to calculate prevent counterfeiting. this metric. FLEET FUEL We exercise a process of continual MANAGEMENT feedback and refinement to optimize Discussion of due diligence practices that minimize the time, cost process to qualify suppliers HC-DI- See the Product Quality and Safety Description of efforts to and environmental impact of our order HC-DI- COUNTERFEIT of drug products and medical 260a.2 section of this report. reduce the environmental fulfillment operations. DRUGS 110a.2 equipment and devices. impact of logistics. For more information, see the Transportation and Logistics section of this report. Total amount of monetary In FY2022, Premier incurred no Discussion of process losses as a result of legal HC-DI- monetary losses that resulted from for alerting customers proceedings associated with 250a.1 legal proceedings associated with and business partners HC-DI- See the Counterfeit Drugs and product safety. product safety. of potential or known 260a.3 Traceability section of this report. risks associated with PRODUCT Description of efforts to counterfeit products. SAFETY minimize health and safety risks of products sold HC-DI- See the Product Quality and Safety associated with toxicity/ 250a.2 section of this report. chemical safety, high abuse potential or delivery. 44
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management SUSTAINABILITY ACCOUNTING STANDARDS BOARD The tables below incorporate accounting standards from the SASB related to Health Care Distributors (HC-DI) as well as relevant topics from Medical Equipment and Supplies (HC-MS) and Software and IT Services (TC-SI). It includes references to sections within this report where specific topics are discussed in further detail. SUSTAINABILITY DISCLOSURE TOPICS AND SUSTAINABILITY DISCLOSURE TOPICS AND ACCOUNTING METRICS: HEALTHCARE DISTRIBUTORS ACCOUNTING METRICS: MEDICAL EQUIPMENT AND SUPPLIES SASB SASB SASB TOPIC ACCOUNTING METRIC RESPONSE SASB TOPIC ACCOUNTING METRIC RESPONSE CODE CODE Discussion of process to Discussion of strategies to assess and manage reduce the environmental HC-DI- See the Supply Chain Environmental environmental and human PRODUCT DESIGN HC-MS- See the Supply Chain Environmental impact of packaging 410a.1 Considerations section of this report. AND LIFECYCLE health considerations 410a.1 Considerations section of this report. throughout its lifecycle. MANAGEMENT associated with chemicals in PRODUCT products and meet demand LIFECYCLE This data is not collected at this time. for sustainable products. MANAGEMENT Amount (by weight) of See the Supply Chain Environmental Percentage of (1) entity’s products accepted for HC-DI- Considerations section of this report facilities and (2) Tier I take-back and reused, 410a.2 for more information on how we suppliers’ facilities recycled or donated. incorporate environmental HC-MS- See the Supply Chain Services participating in third-party considerations into our services. 430a.1 section of this report. audit programs for manufacturing and Description of efforts to product quality. minimize conflicts of interest HC-DI- See the Ethics and Compliance and unethical business 510a.1 section of this report. practices. Description of efforts to HC-MS- See the Counterfeit Drugs and SUPPLY CHAIN maintain traceability within BUSINESS ETHICS 430a.2 Traceability section of this report. MANAGEMENT Total amount of monetary the distribution chain. In FY2022, Premier did not incur any losses as a result of legal HC-DI- losses as a result of legal proceedings proceedings associated with 510a.2 associated with bribery, corruption or bribery, corruption or other other unethical business practices. unethical business practices. Description of the management of risks HC-MS- See the Supply Chain Services associated with the use of 430a.3 section of this report. critical materials. 45
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management SUSTAINABILITY ACCOUNTING STANDARDS BOARD The tables below incorporate accounting standards from the SASB related to Health Care Distributors (HC-DI) as well as relevant topics from Medical Equipment and Supplies (HC-MS) and Software and IT Services (TC-SI). It includes references to sections within this report where specific topics are discussed in further detail. SUSTAINABILITY DISCLOSURE TOPICS AND SUSTAINABILITY DISCLOSURE TOPICS AND ACCOUNTING METRICS: SOFTWARE AND IT SERVICES ACCOUNTING METRICS: MEDICAL EQUIPMENT AND SUPPLIES SASB SASB SASB TOPIC ACCOUNTING METRIC RESPONSE SASB TOPIC ACCOUNTING METRIC RESPONSE CODE CODE (1) Total energy consumed, For FY2021: TC-SI- Number of users whose (2) percentage grid electricity, TC-SI- The use of user information is 130a.1 1 information is used for 1) 6,781,056 kWh, (2) 100%, (3) 20.4% (3) percentage renewable. 220a.2 described in our Privacy Policy. secondary purposes. (1) Total water withdrawn, (2) total water consumed, Total amount of monetary In FY2022, Premier did not incur percentage of each in TC-SI- ENVIRONMENTAL This data is not tracked at this time. losses as a result of legal TC-SI- any losses, fines or penalties resulting regions with high or 130a.2 FOOTPRINT OF HARDWARE proceedings associated with 220a.3 from legal proceedings related to extremely high baseline INFRASTRUCTURE user privacy. user privacy. water stress. Discussion of the integration In FY2022, Premier’s Chief Privacy of environmental Officer did not receive any requests TC-SI- See the Energy Management section (1) Number of law considerations into strategic DATA PRIVACY from government or law enforcement 130a.3 of this report. enforcement requests for AND FREEDOM planning for data center related to user information. user information, (2) number OF EXPRESSION needs. TC-SI- of users whose information Consequently, there were no users 220a.4 was requested, (3) Premier aligns digital activities with the whose information was requested and percentage resulting in laws of the nations in which we no resulting disclosures. This response disclosure. operate. Premier’s Privacy Statement is excludes requests, if any, that Premier Description of policies and reviewed and updated with reference to is prohibited from disclosing by law. DATA PRIVACY practices relating to TC-SI- standardized processes and tools to AND FREEDOM behavioral advertising and 220a.1 help us comply with applicable laws. In Premier’s products and services are OF EXPRESSION user privacy. addition, Premier maintains a number List of countries where core subject to customer oversight and of internal privacy-related policies to products or services are contract terms but are not otherwise TC-SI- ensure that we have a comprehensive subject to government- subject to government-required 220a.5 approach to privacy management. required monitoring, blocking, monitoring (other than applicable content filtering or censoring. regulatory requirements), blocking, 1 Approximately 20.4% of Premier’s energy use is from our primary production data center in Culpeper, content filtering or censoring. VA, (owned and operated by Equinix) which is 100% covered by renewable Energy Certificates (RECs). 46
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management SUSTAINABILITY ACCOUNTING STANDARDS BOARD The tables below incorporate accounting standards from the SASB related to Health Care Distributors (HC-DI) as well as relevant topics from Medical Equipment and Supplies (HC-MS) and Software and IT Services (TC-SI). It includes references to sections within this report where specific topics are discussed in further detail. SUSTAINABILITY DISCLOSURE TOPICS AND SUSTAINABILITY DISCLOSURE TOPICS AND ACCOUNTING METRICS: SOFTWARE AND IT SERVICES ACCOUNTING METRICS: SOFTWARE AND IT SERVICES SASB SASB SASB TOPIC ACCOUNTING METRIC RESPONSE SASB TOPIC ACCOUNTING METRIC RESPONSE CODE CODE Employee engagement score vs. global (1) Number of data breaches, benchmark as of March 2022: 78 (2) percentage involving See the Cyber Risk Management, TC-SI- (benchmark: 76). personally identifiable Data Security and Customer Privacy Employee engagement as a TC-SI- 230a.1 information (PII), section of this report. percentage. 330a.2 For more information, see the (3) number of users affected. Recruitment, Engagement and RECRUITING AND MANAGING A Retention section of this report. GLOBAL, DIVERSE Premier maintains a formal AND SKILLED Percentage of gender and Information Security Risk Management WORKFORCE racial/ethnic group Program to continually identify, assess, representation for (1) TC-SI- mitigate, report, and monitor security DATA SECURITY See ESG Data Table above. management, (2) technical 330a.3 risks across the enterprise. Premier’s Description of approach to staff and (3) all other Information Security Risk Management identifying and addressing TC-SI- employees. and Compliance (ISRMC) team reviews data security risks, including 230a.2 and evaluates the risks identified in the use of third-party program at least annually. cybersecurity standards. Total amount of monetary INTELLECTUAL In FY2022, Premier did not experience losses as a result of legal PROPERTY For more information see the Cyber TC-SI- a monetary loss as a result of legal PROTECTION AND proceedings associated with Risk Management, Data Security 520a.1 proceedings associated with anti- COMPETITIVE anti-competitive behavior and Customer Privacy section of BEHAVIOR competitive behavior regulations. regulations. this report. RECRUITING AND Percentage of employees MANAGING A TC-SI- GLOBAL, DIVERSE that are (1) foreign nationals For FY2022: 1) 2% 2) 0% 330a.1 AND SKILLED and (2) located offshore. WORKFORCE 47
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management SUSTAINABILITY ACCOUNTING STANDARDS BOARD The tables below incorporate accounting standards from the SASB related to Health Care Distributors (HC-DI) as well as relevant topics from Medical Equipment and Supplies (HC-MS) and Software and IT Services (TC-SI). It includes references to sections within this report where specific topics are discussed in further detail. SUSTAINABILITY DISCLOSURE TOPICS AND ACCOUNTING METRICS: SOFTWARE AND IT SERVICES SASB SASB TOPIC ACCOUNTING METRIC RESPONSE CODE In FY2022, Premier did not experience Number of (1) performance a performance or downtime issue that issues, (2) service TC-SI- had a material impact on the business disruptions, (3) total 550a.1 that required regulatory reporting to customer downtime. authorities or incurred financial penalties. Risks and potential risks are identified and incidents (man-made disasters, extreme weather, epidemics/ MANAGING pandemics, natural disasters) are SYSTEMIC RISKS FROM tracked that could result in either TECHNOLOGY short- or long-term disruptions. DISRUPTIONS Continuity measures are implemented Description of business TC-SI- and monitored as appropriate across continuity risks related to 550a.2 business and information technology disruptions of operations. operations to mitigate identified potential materially adverse impacts. For more information, see the Enterprise Risk Management and Business Continuity section of this report. 48
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management UN SUSTAINABLE DEVELOPMENT GOALS The U.N. Sustainable Development Goals (SDGs) are a collaborative, global effort to achieve a better and more sustainable future for all. Represented by 17 global goals and 169 targets, the SDGs address challenges of poverty, inequality, climate change, environmental degradation, and peace and justice. Below we have identified the SDGs we believe have the greatest influence and impact through our business strategy, products and services. REPORT REPORT GOAL DESCRIPTION PREMIER'S ALIGNMENT GOAL DESCRIPTION PREMIER'S ALIGNMENT SECTION SECTION Through our data and analytics capabilities, Ensure healthy Premier is driven by our mission to improve the health Improving collaboratives and other tools, we help healthcare lives and promote Improving of communities. We are uniquely positioned to enable Community providers better understand underserved populations, well-being for all at Community better care and outcomes at a lower cost. Health the severity of health-related problems and the root all ages. Health Reduce inequality causes of disparate outcomes, connecting providers within and among to best practices and care bundles for remediation. Our People We believe the positive impact of our Diversity, Equity, countries. Some of the initiatives we have in place to help and Culture Inclusion and Belonging (DEIB) approach is far address the medically underserved include those Achieve gender reaching, not only within our company, but also for Responsible dedicated to maternal health, opioid abuse, disparity equality and Our People the communities and members we serve. Premier is Supply Chain gaps, social determinants of health and chronic empower all and Culture committed to equal opportunity and pay equity in the health conditions. women and girls. workplace and has various programs in place to ensure women thrive in our professional environment. This report constitutes Premier’s second year of Environmental Through our Sourcing Education and Enrichment for Ensure sustainable ESG reporting. We have also established ESG Management Diverse and Small Suppliers (SEEDS) program, we consumption and structures, including an ESG Steering Committee aim to increase the number of small, diverse and production patterns. that meets quarterly to ensure progress toward our Ethics and regional enterprises doing business with members of sustainability goals. Compliance our healthcare alliance; support diverse and small business enterprises; enable them to grow; and Promote sustained, provide coaching, mentoring, and business This year, Premier completed our inaugural GHG inclusive and educational tools to help them develop strategic assessment, baselining our carbon footprint by sustainable long-term relationships with our members. Environmental Take urgent Responsible calculating our Scope 1 and Scope 2 emissions for economic growth; Management action to combat Supply Chain FY2020 and FY2021. Premier’s commitment to a safe and healthy work full and productive climate change environment extends to our overseas supply chain Responsible employment; and Our Environmentally Preferred Purchasing (EPP) and its impacts. operations. Through our work with Bureau Veritas, Supply Chain decent work for all. Advisory Council helps our GPO members identify an international social compliance audit organization, sustainable products, packaging and services. Premier has established criteria for our contracted manufacturing factories in East and Southeast Asia that require factories to ensure a safe, healthy work environment, compensation that adheres to local law and at no time permits indentured service. 49
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management ESG MATERIALITY ASSESSMENT DEFINITIONS HUMAN CAPITAL The following table lists the definitions of each of the 24 key ESG factors that surfaced through our ESG Materiality Assessment completed during FY2022. Please see page 6 for more information regarding this assessment and how Providing a work environment that promotes diversity of gender, ethnicity, Premier is incorporating it into its approach to ESG. Diversity, Equity and Inclusion sexual orientation, physical ability, age, religious or personal beliefs and socioeconomic background. Employee Engagement, Training Implementing programs and policies that attract and retain talent. and Development BUSINESS MODEL AND INNOVATION Labor Practices and Employee Upholding fair labor practices for all employees. Business Model Resilience and Well-Being Preparing for and managing potential crises and risks that may impact the business. Systemic Risk Management ENVIRONMENT Researching, developing and offering products that integrate environmental, social ESG Impacts of Products and governance considerations and take advantage of consumer trends and interests Measuring and minimizing the usage and impacts from the company’s data centers and Services Energy Management in sustainability. and energy consumption. Establishing strategies to reduce the environmental impacts and risks throughout the Understanding and minimizing the risks associated with climate change and their Environmental Management Impacts of Climate Change company’s operations and facilities. impacts on the company. Greenhouse Gas Measuring and minimizing greenhouse gas emissions wherever feasible throughout the (GHG) Management company’s operations and facilities. Management of the Legal Ensuring compliance with applicable laws and regulations and upholding ethics and Regulatory Environment and values when engaging in activities that may influence public policy. Recycling and Waste Measuring and minimizing the production of waste wherever feasible throughout the lifecycle Management of the company’s products and services. Supply Chain Management Understanding and ensuring that the entire value chain, including suppliers, aligns with the and Human Rights company’s business ethics, including social and environmental performance. Measuring and minimizing the usage and impacts from water consumption wherever feasible Water Management throughout the company’s operations and facilities. GOVERNANCE AND LEADERSHIP SOCIAL CAPITAL Board Independence Promoting and accurately sharing the structure of the company’s Board to ensure and Diversity effectiveness and representation of stockholder values. Access and Affordability Taking measures to ensure the accessibility and inclusiveness of products and services. Ensuring that the company’s values, standards and norms are ethical and managed Protecting and mitigating the risks associated with personally identifiable Business Ethics Customer Privacy throughout business operations. information (PII) and user data. Data Security Establishing an information and cybersecurity system that is secure, resilient and reliable. Ensuring oversight and management of environment, social and governance topics Governance of “ESG” throughout the company’s operations. Customer Welfare Promoting and protecting customer well-being by minimizing the health and Product Safety and safety risks of product offerings. Intellectual Property and Anti- Implementing anti-competitive practices and behaviors that address the issues associated Competitive Behavior with monopolies. Philanthropy and Volunteerism Supporting and establishing positive relations with communities. Actively seeking input from stakeholders to incorporate Product Quality and Supply Establishing and sustaining processes to ensure that products meet quality Stakeholder Engagement into business strategies and priorities. Chain Integrity standards in accordance with regulatory requirements. 50
Ethics and Our People Improving Responsible Environmental Overview Appendix Compliance and Culture Community Health Supply Chain Management