Universal
Music Group
Annual Report
2024
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
CONTENTS
ABOUT UMG 3
We are Universal 4
Profile 6
Mission & Vision 7
Our Values 8
2024 Chart Highlights 11
Summary of Investment Highlights 18
Key Figures 2024 19
Financial Data For The Last Three Years 20
Global Impact Highlights 21
How UMG Adds Value 24
Year in Review 25
BOARD REPORT 26
Introduction 27
Strategy 37
Organizational and Reporting Structure 46
Financial Review 50
Corporate Governance 59
Shareholder Information 78
Risk and Risk Management 82
Sustainability Statement 103
NON-EXECUTIVE DIRECTORS' REPORT 153
Non-Executive Directors' Report 154
Remuneration Report 163
FINANCIAL STATEMENTS 179
Consolidated Statements 180
Company Statements 236
OTHER INFORMATION 254
Distribution of Profits 255
Independent Auditor's Report 256
Limited assurance report of the independent auditor on the
sustainability statement
267
APPENDIX 271
Biographies of the Corporate Executives 272
Biographies of the Board of Directors 276
Definitions 280
Cautionary Notice 283
MUSIC IS UNIVERSAL Annual Report 2024
| 2
About UMG
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
FOREWORD
WE ARE UNIVERSAL
Dear Fellow Shareholders:
It is with great pleasure that I write to you about your company’s accomplishments for the year
past. In fact, we not only accomplished so much in 2024 but we have also positioned ourselves for
another great year of success in 2025 and beyond.
Our company’s fundamental building block is artist development and in 2024, our work with, and
investment in, new talent continued to produce spectacular results around the world. Consider the
following facts: UMG broke the two biggest artists in the world last year in Sabrina Carpenter and
Chappell Roan—artists each with a unique creative vision and career journey who were supported
and developed by UMG’s teams globally; Taylor Swift was the most streamed artist globally on Spotify,
Amazon and Deezer; and Apple Music named Billie Eilish its Artist of the Year. And that a UMG
recording artist who is also signed to UMPG as a songwriter had the No. 1 song globally on the
year-end lists for both Apple Music (Kendrick Lamar) and Spotify (Sabrina Carpenter). As you’ll see
throughout this report, our achievements were not only from a few superstars, but from hundreds
of artists around the world—both developing and established—performing in multiple genres, styles
and languages.
Achievements like these don’t just happen. They are the culmination of maintaining a
clear
vision
of who we are, what we do and where we’re going, then
executing on that vision
,
maintaining
momentum
and, of course, at the heart of it all, having some
absolutely incredible music
to work
with. And last year those achievements were greatly assisted by our continuing self-reinvention,
reshaping our organizational structure, rebuilding our teams and refining our strategy. A vision
which boldly and, when necessary, quickly adapts to an ever-changing world. For example, in early
2024 we executed on our vision to realign our U.S. label structure, and within months we were
operating with greater agility and efficiency. We then saw something exceptional take place: UMG
had its best U.S. performance in six years, according to Luminate.
In 2024, we continued to lead the media industry in our embrace and advancement of “Responsible
AI”. Three recent examples of that initiative include our agreements with SoundLabs, ProRata and
KLAY—companies that are taking unique approaches to the rapidly evolving AI space through new
technologies that provide accurate attribution and tools to empower and compensate artists.
Our leadership also includes our commitment to the enactment of Responsible AI public policies,
fighting back against so-called Text and Data Mining copyright exceptions and other misguided
proposals that would enable the unauthorized exploitation of creators’ work. Instead, we will work
towards legislative “guardrails” to ensure the healthy evolution and growth of AI that mutually
serves creators, consumers and responsibly innovative technology players.
In my note last year, I said that 2024 would see us once again attracting the brightest entrepreneurs,
expanding our existing relationships with other such talents and investing more resources into
providing a full suite of artist services businesses to independent labels around the world. And we
did exactly that. We acquired the remaining share of [PIAS] two years after taking an initial stake in
the company, and we grew our geographic footprint
, for example by partnering with and investing
in Mavin Global in Nigeria. The reason so many independent music entrepreneurs actively seek to
partner with UMG when they have more alternatives than ever before is that we provide what they’re
seeking: the most innovative creatives and finest resources that will advance the careers of their
artists and achieve their financial goals within a culture that respects artists and their music. After
all, we’re not a financial institution that views music as an “asset”. And we’re not an aggregator that
views music as “content”. We are a
music
company built by visionary music entrepreneurs. For us,
music is a vital—perhaps
the
vital—art form.
And finally, one of 2024’s announcements of which I am proudest is the formation of our Global
Impact Team, whose mission is to enact positive change in our industry and in the communities
in which we serve. This cross-functional group of executives brings a deep understanding of our
global organization and will develop and execute strategies to tackle a variety of critical issues,
including: equality; mental health and wellness; food insecurity and the unhoused; the environment;
and education.
Now to 2025 … starting with our artist-centric strategy:
MUSIC IS UNIVERSAL
Annual Report 2024 | 4
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When we introduced that strategy two years ago, we immediately went to work with our partners
to make it a reality. In a matter of months, we reached agreements in principle on a number of
issues: increasing the monetization of artists’ music; limiting the gaming of the system by protecting
against fraud and content saturation; and focusing on the value of authentic artist-fan relationships,
inspiring the development of more engaging consumer experiences, including specially designed
new products and premium tiers for superfans. Platforms as diverse as Deezer, Spotify, TikTok,
Meta and most recently Amazon, have adopted artist-centric principles in a wide variety of ways
—principles that benefit the
entire
music industry from DIY to independent to major label artists
and songwriters.
Our work in driving these artist-centric principles will continue in 2025. Not only do we want to
ensure that artists are protected and rewarded, but we’re also going after bad actors who are actively
engaged in nefarious behavior such as large-scale copyright infringement. To that end, we’re setting
forth the best practices that every responsible platform, distributor and aggregator should adopt:
content filtering; checks for infringement across streaming and social platforms; penalty systems for
repeat infringers; chain-of-custody certification and name-and-likeness verification.
In September, during our Capital Markets Day presentation, I described what would constitute the
next era of streaming—Streaming 2.0. Built on a foundation of artist-centric principles, Streaming
2.0 will represent a new age of innovation, consumer segmentation, geographic expansion, greater
consumer value and ARPU growth.
I’m pleased to report that the Streaming 2.0 era has arrived. We recently announced a new
agreement with Amazon that includes many of these elements, and in early 2025, we announced
a multi-year agreement with Spotify.
In 2025, we’ll also be reaching out in new ways to engage fans. In addition to listening to their
favorite artists’ music, fans want to build deeper connections to artists they love. Some of this will be
done through our current partners and some through our own direct-to-consumer (D2C) channels,
which we will continue scaling to meet the massive appetite of fans.
The work that lies ahead of us will bring challenges, no doubt about that. But we will meet those
challenges with pride and a sense of privilege, because no other form of creative expression is more
fundamental to human existence than music. Our vision and our ability to consistently execute
gives us the momentum to continue to succeed and grow.
I can’t wait to see and
hear
what this year brings.
Lucian
SIR LUCIAN GRAINGE, CHAIRMAN AND CEO,
UNIVERSAL MUSIC GROUP
MUSIC IS UNIVERSAL Annual Report 2024 | 5
FOREWORD
MUSIC MERCHANDISING
>220
ARTISTS / BRANDS
RECORDED MUSIC
>3.4 MILLION
RECORDINGS
MUSIC-BASED VISUAL ENTERTAINMENT
A LIBRARY OF MORE THAN
>3,500 TITLES
OF LONG-FORM MUSIC-BASED
AUDIOVISUAL CONTENT
MUSIC PUBLISHING
5 MILLION
OWNED & ADMINISTERED TITLES
1
N
º
1
N
º
1
N
º
2
N
º
WE HAVE A RICH HISTORY AND HAVE BUILT AN UNPARALLELED CATALOG OF SONGS AND RECORDINGS
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
PROFILE
MUSIC IS UNIVERSAL Annual Report 2024 | 6
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
MISSION & VISION
Mission
More music to more people in more ways
We are Universal Music Group, the world’s leading music company.
We exist to shape culture through the power of artistry.
We are a community of entrepreneurs committed to creativity and innovation.
We own and operate a broad array of businesses engaged in recorded music, music publishing,
merchandising, and audiovisual content in more than 60 territories around the world.
We identify and develop recording artists and songwriters, and we produce, distribute and promote
the most critically acclaimed and commercially successful music to inspire and entertain fans
around the world.
Our vast catalog of recordings and songs stretches back over a century and comprises the largest,
most diverse and culturally rich collection of music ever assembled.
As technology refashions the world, our unmatched commitment to lead in developing new services,
platforms and business models for the delivery of music and related content empowers innovators
and allows new commercial and artistic opportunities to flourish.
Knowing that music, a powerful force for good in the world, is unique in its ability to inspire people
and bring them together, we work with our artists and employees to serve our communities.
We are the home to music’s greatest artists, innovators and entrepreneurs.
TOGETHER, WE ARE UNIVERSAL MUSIC GROUP
Vision
Putting artists and songwriters first
Artists and songwriters are at the heart of everything we do at Universal Music Group (UMG). Focused
on their long-term development, our company is built to serve their unique needs throughout their
careers. Successfully producing and marketing music requires a significant upfront investment and
an ongoing collaboration. UMG invests more in developing talent, and does so with greater expertise,
than any other music company. This investment, combined with our excellence in marketing and
promoting artists globally, means we consistently lead the industry in breaking new artists.
Putting artists first sets us apart. We turn art into hits and hits into careers. By building a continuum
of services and resources for artists, we've designed UMG so we can partner with artists at each
stage of their careers to provide them with all the services and resources they need. We start
by identifying the artists with whom we want to partner and presenting them with a world of
opportunities to accelerate their careers. We remain by their side with customized campaigns and
promotion, platform-integrated targeted marketing, top-tier data and insights, and global reach with
local activation.
We work side-by-side with them over the long-term to build and sustain their careers
through continuous engagement, improving lifetime fan value, and enabling unique access
to synchronization, brand partnerships, licensing opportunities and eCommerce capabilities to
monetize fandom.
Our artist-centric approach gives us an unrivalled track record in artist development and
commercial success.
MUSIC IS UNIVERSAL
Annual Report 2024 | 7
PLACEHOLDER
PAGE INSERT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
OUR VALUES
DRIVE
ALWAYS PUSH FOR THE NEXT LEVEL
OF GREATNESS
INSIGHT
SEE WHAT OTHERS DON'T SEE
AUTHENTICITY
EXPRESS WHO YOU TRULY ARE AND WHAT
YOU BELIEVE
CONNECTION
DRAW STRENGTH FROM DIVERSE AND
MEANINGFUL RELATIONSHIPS
BOLDNESS
ACT DECISIVELY WITH OWNERSHIP
AND CONVICTION
CREATIVITY
MEET A CHALLENGE IN NEW AND
UNEXPECTED WAYS
MUSIC IS UNIVERSAL Annual Report 2024 | 8
AFRICA
AMERICAS
ASIA
EUROPE
Chappell RoanSabrina Carpenter Kendrick Lamar
BadshahHanumankind
Andrea Bocelli Lewis Capaldi Loreen Sam Smith U2
The WeekndNoah Kahan
Jay Chou
Eason Chan
De MthudaAyra Starr DJ Stokie Rema Sam Deep Soolking Xolly Mncwango
Billie EilishKarol G
Mrs. GREEN APPLE BLACKPINK
Helene Fischer Stormzy
Ado
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UNIQUE ABILITY TO IDENTIFY AND SIGN THE WORLD'S BEST ARTISTS
AND SONGWRITERS
MUSIC IS UNIVERSAL Annual Report 2024 | 9
TOP 10 GLOBAL ARTISTS (2019-2024)
8/10
2019
9/10
2020
9/10
2024
8/10
2021
7/10
2022
9/10
2023
OF UMG’S TOP 10 GLOBAL ARTISTS, U.S./U.K. VS. NON-U.S./U.K.
8/8
U.S /U.K
9/9
U.S /U.K
2/8
Non
U.S /U.K
6/8
U.S /U.K
4/7
Non
U.S /U.K
3/7
U.S /U.K
4/9
Non
U.S /U.K
5/9
U.S /U.K
2/9
Non
U.S /U.K
7/9
U.S /U.K
Source: IFPI Global Charts (2019-2024)
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
UMG IS CONSISTENTLY HOME TO THE WORLD'S BEST-SELLING
RECORDING ARTISTS
MUSIC IS UNIVERSAL Annual Report 2024 | 10
GLOBAL
Spotify
Amazon Music
7 of the TOP 10 MOST REQUESTED
ARTISTS on Alexa
The
TOP ARTIST
was Taylor Swift
The TOP ALBUM
was Taylor Swift’s
The
Tortured Poets Department
#
1
6 of the TOP 10 ARTISTS with Taylor
Swift at No. 1 and The Weeknd at No. 2
5 of the TOP 10 SONGS
with Sabrina Carpenter’s “Espresso” at No. 1
8 of the TOP 10
ALBUMS with Taylor
Swift’s
The Tortured
Poets Department:
The Anthology
at No. 1
#
1
ARTIST of the YEAR
was Billie Eilish
6 of the TOP 10 SONGS
with Kendrick Lamar’s
“Not Like Us” at No. 1
Apple Music
UMPG
On Spotify, 7 of the TOP 10 ARTISTS
including ALL of the TOP 5
Interest in 4 of the TOP 5 ALBUMS
and 4 of the top 5 SONGS
On Apple Music, interest in
8 of the TOP 10 SONGS
4 of the TOP 5
ARTISTS
with
Taylor Swift
at No. 1
Deezer
#
1
8 of the TOP 10
ARTISTS
with Karol G
at No. 1 for the fourth
consecutive year
Vevo
#
1
U.S.
On Apple Music,
interest in 7 of the
TOP 10 SONGS
including ALL of the
TOP 5 with Kendrick
Lamar’s “Not Like Us”
at No. 1
On TikTok,
3 of the TOP 5 ARTISTS
On Billboard, 3 of the TOP 5 HOT 100
SONGWRITERS with Taylor Swift at
No. 1 and Jack Antonoff at No. 2
UMPG
6 of the TOP 10 ARTISTS
with Taylor Swift at No. 1
7 of the TOP 10
SONGS
with Sabrina
Carpenter’s
“Espresso” at No. 1
8 of the TOP 10 ALBUMS
with Taylor Swift’s
The Tortured Poets
Department: The Anthology
at No. 1
Spotify
8 of the TOP 10 ALBUMS including
ALL of the TOP 5
ALL of the
TOP 3 LABELS
including REPUBLIC
Collective at No. 1 for
the fourth consecutive
year
UMG also had the No. 2 and No. 3 label
groups with Interscope Capitol Labels Group
and Universal Music Enterprises
Billboard
COLLECTIVE
#
1
#
1
6 of the TOP 10 SONGS
with Kendrick Lamar’s “Not Like Us” at No. 1
YouTube
14 of the TOP 20
SONGS including
3 of the TOP 5
with Kendrick Lamar’s
“Not Like Us” at No. 1
Apple Music
#
1
#
1
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2024 CHART HIGHLIGHTS
MUSIC IS UNIVERSAL Annual Report 2024 | 11
REGIONAL
NO. 1 SONG
on Spotify by
Son Tùng M-TP
NO. 1 SONG on Apple
Music by Wren Evans
TOP 3 POSITIONS on
IFPI’s 2024 ARTISTS CHART
Vietnam
Biggest breakthrough
ARTIST of the
YEAR on Spotify
with Dionela
Philippines
According to Official
Charts Company:
7 of the TOP 10
ALBUMS including
ALL OF THE TOP 6
with Taylor Swift’s
The Tortured Poets
Department
at No. 1
6 of the TOP 10 SONGS
including
Noah Kahan’s
“Stick Season” at No. 1
EMI was the No. 1 LABEL
for the third consecutive year
UK
#
1
#
1
According to ARIA:
17 of the TOP 20
ALBUMS
including
ALL OF THE TOP 5
and Taylor Swift’s
The Tortured Poets Department
at No. 1
Australia
#
1
According to BMAT: TOP 2 SONGS of
the YEAR from
Felipe e Rodrigo
and Lauana Prado
THE TOP ARTIST
with Henrique
& Juliano
Brazil
Japan
5 of the TOP 10
SINGLES on
Billboard Japan’s
year-end Hot 100 chart,
including 4singles
from Mrs. GREEN APPLE
4 of the TOP 10 ARTISTS on Spotify,
including Mrs. GREEN APPLE at No. 1
According to Luminate:
14 of the TOP 20
ALBUMS including
ALL OF THE TOP 7
with Taylor Swift’s
The Tortured Poets
Department
at No. 1
No. 1
POSITION on the ALBUM chart
for 41 weeks of the year
5 of the TOP 10 SINGLES
Canada
#
1
According to GfK:
5 of the TOP 10
ALBUMS including
Taylor Swift’s
The Tortured
Poets Department:
The Anthology
at No. 1
and Billie Eilish’s
Hit Me Hard
and Soft
at No. 2
Germany
#
1
#
1
France
According to Official
Charts Company:
ALBUMS from
12 DIFFERENT
ARTISTS HIT NO. 1
throughout the year
4 of the TOP 10
ALBUMS including
Billie Eilish’s
Hit Me Hard and Soft
Zaho de Sagazan’s
La symphonie des éclairs
(Le dernier des voyages)
SDM’s
A LA VIE A LA MORT
Taylor Swift’s
The Tortured Poets Department
#
1
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MUSIC IS UNIVERSAL Annual Report 2024 | 12
Note: Influencer ranking based on number of instagram, X, TikTok and YouTube followers as of December 2024
Source: Instagram, X, TikTok, YouTube
10 musicians (7/10 UMG Artists) 5media personalities 4athletes 1actor
TOP 20
GLOBAL
INFLUENCERS
Selena Gomez
Katy Perry
Justin Bieber
Nicki Minaj
Ariana Grande
Rihanna
Taylor Swift
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MUSIC IS INFLUENTIAL
MUSIC IS UNIVERSAL Annual Report 2024 | 13
BRANDS & SPONSORS
HEALTH & WELLNESSFITNESS
RADIO, TV & CABLE NETWORKS FILM & TV PRODUCTION
SOCIAL MEDIA RETAIL & ECOMMERCE
VIDEO GAMING
VIDEO STREAMING MUSIC STREAMING
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MUSIC POWERS ENGAGEMENT ACROSS A VAST ECOSYSTEM
MUSIC IS UNIVERSAL Annual Report 2024 | 14
• ENHANCING
ARTISTS’ ABILITY
TO EXPERIMENT AND
BOOST CREATIVITY
• DEFENDING ARTISTRY
AND RIGHT TO FAIR
COMPENSATION
• ADAPTING MUSIC
TO NEW PRODUCTS
AND FORMATS
HEALTH AND
WELLNESS
SOUNDSCAPES
SOCIAL MUSIC
CREATION
GENERATIVE AI
CONTENT, ATTRIBUTION
AND COMPENSATION
SOLUTIONS
VOICE-TO-VOICE,
VOICE-TO-
INSTRUMENT AI
ECOSYSTEM FOR
AI-DRIVEN CONTENT,
INCLUDING ACCURATE
ATTRIBUTION
AI MUSIC INCUBATOR
PRINCIPLES FOR MUSIC
CREATION WITH AI
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EMBRACING RESPONSIBLE AI TO ADVANCE INNOVATION
MUSIC IS UNIVERSAL Annual Report 2024 | 16
Cornerstone partnership for launch of
YouTube Music subscription service
Landmark partnership to develop Dolby Atmos
Launch partner for the YouTube Music AI Incubator
Exclusive partner for first FDA-approved
prescription therapeutic music product
First music company to commercially
license a social media platform
Expand livestream agreements to
enhance artist-fan engagement
Industry-leading products with platform’s
largest music audiences
NTWRK/Complex
Strategic partner in a new venture
between NTWRK and Complex to create
a destination for “superfan” culture
One of “World’s 50 Most
Innovative Companies”
#1 in Music
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UMG'S INNOVATION PROMOTES INDUSTRY GROWTH
AND DEVELOPMENT
MUSIC IS UNIVERSAL Annual Report 2024 | 17
LEADING RECORDED MUSIC LABELS AND MUSIC PUBLISHING BUSINESS - EXPANDING ICONIC CATALOG
STRONG FREE CASH FLOW WITH IMPROVING OPERATING LEVERAGE
WORLD-CLASS MANAGEMENT TEAM
POWERING THE NEXT
ERA OF RECURRING
STREAMING GROWTH
(STREAMING 2.0)
UNLOCKING SUPERFAN
MONETIZATION
THROUGH INNOVATIVE
NEW PRODUCTS AND
EXPERIENCES
FUELING AN EXPANDING
ECOSYSTEM OF MUSIC
DRIVEN BUSINESSES
ATTRACTIVE
OPPORTUNITIES FOR
EXPANSION: HIGH-
POTENTIAL MARKETS,
INDEPENDENT LABEL
SERVICES
DRIVING INNOVATION AND EXPANDING TOTAL ADDRESSABLE
MARKET WITH LONG RUNWAY FOR HIGH GROWTH
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SUMMARY OF INVESTMENT HIGHLIGHTS
MUSIC IS UNIVERSAL Annual Report 2024 | 18
Note:
% YoY indicates % change year-over-year
% constant indicates % change year-over-year adjusted for constant currency
1
as defined in the Appendix to the Annual Report
Segment revenue is stated prior to elimination of intersegment transactions
EBITDA
1
2024 2023
2,332 1,808
YoY
+29.0% -10.8%
constant +31.3% -7.8%
ADJUSTED EBITDA
1
2024 2023
2,661 2,369
YoY
+12.3% +11.0%
constant +13.8% +14.6%
REVENUE 2024 2023
11,834 11,108
YoY
+6.5% +7.4%
constant +7.6% +11.1%
EBITDA MARGIN
1
2024 2023
19.7% 16.3%
YoY
+3.4pp -3.3pp
ADJUSTED EBITDA
MARGIN
1
2024 2023
22.5% 21.3%
YoY
+1.2pp +0.7pp
OPERATING PROFIT 2024 2023
1,775 1,418
YoY
+25.2% -11.4%
constant +28.0% -8.3%
UMG RESULTS (in € millions) YEAR ENDED DECEMBER 31
Results per business segment (in € millions) Year Ended December 31
REVENUE 2024 2023
8,901 8,461
YoY
+5.2% +6.6%
constant +6.4% +10.2%
YoY growth in constant currency
Subscription and Streaming Revenue +6.8% +10.4%
Downloads and Other Digital Revenue -11.8% -35.7%
Physical Revenue +1.1% +19.4%
License and Other Revenue +13.5% +13.6%
RECORDED MUSIC
REVENUE 2024 2023
842 706
YoY
19.3% +14.2%
constant 19.3% +17.9%
REVENUE 2024 2023
2,121 1,956
YoY
+8.4% +8.7%
constant +9.0% +12.3%
MUSIC PUBLISHING MERCHANDISING AND OTHER
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
KEY FIGURES 2024
MUSIC IS UNIVERSAL Annual Report 2024 | 19
Note: In millions of euros, number of shares in millions, data per share in euros.
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
FINANCIAL DATA FOR THE LAST THREE YEARS
Year ended December 31,
2024 2023 2022
Consolidated data
Revenues 11,834 11,108 10,340
EBITDA
1
2,332 1,808 2,028
Adjusted EBITDA
1
2,661 2,369 2,135
Operating profit 1,775 1,418 1,600
Net profit attributable to equity holders of the parent 2,086 1,259 782
Adjusted net profit
2
1,782 1,626 1,479
Net Cash Position/(Financial Net Debt)
1
(2,098) (1,689) (1,810)
Net cash provided by operating activities before income tax paid 2,104 2,278 1,987
Free Cash Flow
1
523 1,082 1,086
Dividends paid by UMG N.V. to its shareholders (933) (929) (798)
Per share data
Weighted average number of shares outstanding 1,827 1,819 1,813
Earnings attributable to UMG N.V. shareowners per share - basic 1.14 0.69 0.43
Earnings attributable to UMG N.V. shareowners per share - diluted 1.13 0.68 0.43
Adjusted net profit per share - basic
1
0.98 0.89 0.82
Adjusted net profit per share - diluted
1
0.96 0.88 0.81
1 Non-IFRS measures as defined in the Appendix to the Annual Report.
2 Following a change in the definition, the FY23 & FY22 Adjusted Net Profit have been restated to exclude the impacts of
restructuring expenses and related tax impacts.
MUSIC IS UNIVERSAL Annual Report 2024 | 20
GLOBAL IMPACT TEAM SCIENCE-BASED TARGETS OUR EMISSIONS
In 2024, we announced the formation of our
Global Impact Team to enact and amplify
our vision for positive change through
community engagement, environmental
sustainability, events, and special projects.
As the first major standalone music company
to announce science-based targets approved
by the Science-Based Targets initiative (SBTi),
we remain committed to reduce:
· Absolute scope 1 and 2 GHG emissions
58% by 2032 from a 2019 base year,
an ambition which is in line with a 1.5°C
trajectory; and,
· Scope 3 GHG emissions from purchased
goods and services, capital goods, fuel- and
energy-related activities, upstream
transportation and distribution, waste
generated in operations, business travel,
and employee commuting by 62% per EUR
value added
1
within the same timeframe.
We reduced our scope 1 and 2 (market-based)
emissions by 28% from 2019, our base year.
Additionally, we have reduced our scope 3
emissions intensity
2
by 38% from 2019.
See “Climate Change (E1)” section for
our target progress, GHG emissions data,
and methodology.
●
Scope 1: 1,797 tCO
2
e
●
Scope 2: (market-based) 6,467 tCO
2
e
●
Scope 3: 619,156 tCO
2
e
Total GHG
emissions
(market-based)
627,420
tCO
2
e
1 “Value added“ is defined as EBITDA plus all personnel costs. EBITDA is defined in the Appendix to the Annual Report.
2 In line with our science-based target, our scope 3 emissions intensity includes the following categories: purchased goods and services, capital goods, fuel-and energy-related activities, upstream transportation and distribution,
waste generated in operations, business travel, and employee commuting.
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
GLOBAL IMPACT HIGHLIGHTS
MUSIC IS UNIVERSAL Annual Report 2024 | 21
Physical
Streaming and Subscription
Downloads and Other Digital
Performance Rights
Synchronization
CD era Digital download era Streaming era
GLOBAL RECORDED MUSIC BY REVENUE STREAM ($B, ‘99-’24, NOMINAL)
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
21.9
20.6
21.8
20.4
18.9 18.9
18.4
17.8
16.6
15.3
14.3
13.6
13.5
13.5
13.3
12.9
13.3
14.5
15.6
17.2
18.5
19.8
23.5
25.6
28.2
29.6
* All reporting is translated at average CY 2024 exchange rates. Russia has been excluded from all years. Source: IFPI Global Music Report 2025
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
THE MUSIC INDUSTRY HAS EXPERIENCED A RETURN TO GROWTH,
PRIMARILY DRIVEN BY STREAMING
MUSIC IS UNIVERSAL Annual Report 2024 | 22
2024 TOP 10 MARKETS
1. USA +2.2% US$11.3bn
2. JAPAN -0.2% US$2.5bn
3. UK +4.9% US$2.0bn
4. GERMANY +4.1% US$1.7bn
5. CHINA +9.6% US$1.6bn
6. FRANCE +7.5% US$1.3bn
7. SOUTH KOREA -5.7% US$754m
8. CANADA +1.5% US$660m
9. BRAZIL +21.7% US$647m
10. MEXICO +15.6% US$549m
* All reporting is translated at average CY 2024 exchange rates. Russia has been excluded from all years. Source: IFPI Global Music Report 2025
10
9
7
2
4
3
6
5
1
8
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
RECORDED MUSIC INDUSTRY 2024 TOP 10 MARKETS
MUSIC IS UNIVERSAL Annual Report 2024 | 23
OUTPUTINPUT ADDED VALUE
HUMAN
• Employee headcount: 10,346
INTELLECTUAL
Intellectual Property
• World class Record Labels and Brands
• Recorded Music: >3.4 million recordings
• Music: Publishing: 5 million owned &
administrated titles
• >3,500 titles of long-form music-based
audiovisual content
Personal Intellect
• Industry advocacy
• Partnerships and JVs with independent
labels and entrepreneurs
• State-of-the art technology solutions
for streaming
SOCIAL & RELATIONSHIP
• Stakeholder engagement: artists, fans,
employees, shareholders, distribution
partners, government and elected officials
• Offices in 60 countries
• Covering nearly 200 markets
FINANCIAL
• Royalty advance payments,
net of recoupments: €186 million
• Net cash used for investing activities:
€1,051 million
FINANCIAL
• Revenue growth: 7.6%
(constant currency)
• Adjusted EBITDA growth: 13.8%
(constant currency)
ARTISTS
• Artist costs paid: €5,464 million
• Protect intellectual property and rights
EMPLOYEES
• Salaries & benefits paid: €1,788 million
FANS
• Connecting fans with artists they love
SHAREHOLDERS
• Total shareholders return: -0.4%
• Adjusted EPS growth: 10.1%
VISION
PUTTING
ARTISTS FIRST
MISSION
MORE MUSIC
TO MORE
PEOPLE
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
HOW UMG ADDS VALUE
MUSIC IS UNIVERSAL Annual Report 2024 | 24
Named to Fast Company’s prestigious list of
the World’s Most Innovative Companies of 2024,
ranking 45th overall and No.1 in the music category.
UMPG signed songwriter Yusuf/Cat Stevens, who is
responsible for timeless hits like “Father and Son,”
“Wild World,” “The Wind” and “Morning Has Broken”.
Expanded long-term agreement with HYBE, providing UMG
exclusive distribution rights across HYBE music for the next 10 years.
At the 2024 Japan Gold Disk Awards, King & Prince won Album of the Year
and Single of the Year; SEVENTEEN won Asian Album of the Year and Best
Asian Artist; ADO won Concept Album of the Year; The Beatles were named
Artist of the Year/International for the ninth time; Travis Japan was named
New Artist of the Year/Japanese; Mina Okabe was named New Artist of the
Year/International; and LE SSERAFIM was named New Artist of the Year/Asia.
MARCH
At the 66th Annual Grammy Awards, Taylor Swift’s
Midnights
won Album of the Year, making her the first artist
in history to win four Album of the Year honors and Billie
Eilish won Song of the Year for “What Was I Made For ?”
Acquired a 25.8% interest in Chord Music Partners, which
owns a catalog of premier music intellectual property, including
works from artists and songwriters such as The Weeknd, Ryan Tedder/
OneRepublic, David Guetta, Lorde, Kid Cudi, Diplo, Jimmy Jam & Terry Lewis,
Ellie Goulding, ZZ Top, John Legend, Twenty One Pilots and many more.
Majority investment in Mavin Global, the iconic Afrobeats
record label based in Lagos, Nigeria. The label is home to
a number of accomplished artists including Rema, whose
hit single “Calm Down” (featuring Selena Gomez) has
become the biggest Afrobeats song of all time.
Investor and strategic partner in a new venture between
NTWRK, the premium live-video shopping platform and
curated marketplace, and publisher Complex, aiming to
create a destination for “superfan” culture.
FEBRUARY
Landmark strategic
distribution agreement
with China’s leading
music label, Modern Sky,
to provide their extensive
catalog and roster of
artists with access to
UMG’s worldwide
distribution network,
while also opening doors
for expanded collabora-
tion between the two
companies, and to
elevate and introduce
China’s original music
and vibrant youth
culture to international
audiences.
NOVEMBER
Virgin Music Group entered into an
agreement to acquire Downtown
Music Holdings LLC (Downtown) for
cash consideration of $775 million.
The acquisition is expected to close in the second half
of 2025, pending regulatory approvals. With divisions
in artist and label services, distribution, royalty and
financial services and music publishing, Downtown’s
businesses include FUGA, Downtown Artist & Label
Services, Curve Royalties, CD Baby, Downtown Music
Publishing and Songtrust.
Expansion of global deal with Amazon to enable
further innovation, exclusive content with UMG
artists, and advancement of artist-centric principles
including increased fraud protection. Parties will
explore new and enhanced product opportunities
designed to benefit artists and enrich the experience
of their fans.
DECEMBER
Miranda Lambert, the
most awarded artist by
the Academy of Country
Music, signed with
Republic Records.
UMPG signed tenor Andrea
Bocelli, one of the most
successful classical
singers in modern history
with over 90 million
albums sold to date and
more than 16 billion
streams.
APRIL
JANUARY
UMPG signed Lana Del Rey
who has had 15 songs on
the Hot 100 Chart, including
two Top 10s: “Snow On
The Beach” by Taylor Swift
(ft. Lana Del Rey) and
“Summertime Sadness”
by Lana Del Rey and Cedric
Gervais. All nine of her
studio albums reached
the Top 10 on the U.S.
Billboard 200 albums chart.
Expanded global deal with Meta to further the creative
and commercial opportunities for UMG artists and UMPG
songwriters across Meta’s global network of social media
platforms including Facebook, Instagram, Messenger,
Horizon, Threads, and for the first time, WhatsApp. Meta
and UMG will work together to address unauthorized
AI-generated content that could affect artists and
songwriters.
Strategic agreement with ProRata, an AI startup that has
developed technology which enables generative AI
platforms to accurately attribute and share revenues
on a per-use basis with content owners.
Leading Punjabi music singer, rapper, and
producer AP Dhillon signed to Republic
Records in alliance with Universal Music
Canada. One of the biggest Indian artists
today, AP Dhillon has over 5 billion
streams worldwide, combining pop,
hip-hop and global influences.
AUGUST
Sir Lucian Grainge
introduced “Streaming
2.0” at UMG Capital
Markets Day, focusing
on maximizing value
through customer
segmentation driven by
product innovation,
while continuing to grow
the subscriber base.
SEPTEMBER
JUNE
Partnered with innovative
AI technology company
Soundlabs to provide
responsibly trained,
next-generation AI music
tools for UMG’s artists
and producers.
Jelly Roll entered into
a worldwide deal with
Republic Records to focus
on expanding his music
across multiple genres,
as well as marketing
into new territories.
Announced new strategic collaboration
with TikTok to deliver improved
remuneration for UMG’s songwriters
and artists, new promotional and
engagement opportunities for their
recordings and songs and industry-
leading protections with respect to
generative AI.
UK duo Good Neighbour signed with
Capitol and Polydor Records.
UMPG was awarded Publisher of the
Year at the 2024 ASCAP Pop Music
Awards, which honors the songwriters
and publishers of the most-performed
ASCAP pop songs of 2023.
MAY
Acquired the
remaining 51%
of [PIAS] two years
after taking a stake
in the company.
The [PIAS] Group
operates two core business divisions:
the [PIAS] Label Group, home to the group’s
own and associated record labels and
[Integral], the group’s services division, which
provides services to independent labels.
Strategic agreement with iQIYI, China’s
leading online entertainment platform,
to exclusively distribute new releases by
contestants featured on The “Rap of China”
2024, a show which has become a cultural
phenomenon in China.
Virgin Music Group acquired Outdustry,
an artist and label services and rights
management business focused on China,
India and other high-potential markets.
OCTOBER
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
YEAR IN REVIEW
MUSIC IS UNIVERSAL Annual Report 2024 | 25
Board Report
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
INTRODUCTION
A WORLD LEADER IN MUSIC-BASED ENTERTAINMENT
UNIVERSAL MUSIC GROUP is a world leader in music-based entertainment with a broad array
of businesses engaged in recorded music, music publishing, music-based merchandise and
audiovisual content. UMG has the broadest global reach of any music company with a local
presence in more than 60 territories covering nearly 200 markets. Everything we do revolves around
supporting artists, promoting innovation, entrepreneurship, sustainability, and bringing fans the
world’s most loved music. Our three core business segments work seamlessly to lead the dynamic
and ever-changing global music market:
OUR RECORDED MUSIC BUSINESS is dedicated to discovering and developing recording
artists at all stages of their careers and marketing, promoting, distributing, selling, and
licensing the music they create. Showcasing an impressive roster of recording artists,
a diverse range of labels and a catalog of timeless performers with a combined total
of more than three million recordings, our recorded music business is the partner of choice for
artists, innovators, and entrepreneurs around the globe. This business also incorporates our
commercial activity in film & TV, as well as independent artist and label services and distribution.
UNIVERSAL MUSIC PUBLISHING GROUP (UMPG) is committed to signing, administering and
acquiring rights to musical compositions and licensing them for use in multiple formats.
UMPG works closely with their songwriters at all stages in their careers from early
development to the stage where their songs are played for millions. As one of the world’s
largest and fastest-growing music publishing companies, UMPG has a catalog with more than
five million-owned and administered titles and enjoys partnerships with many of the world’s top
songwriters.
Bravado, our MERCHANDISING BUSINESS, represents the merchandising rights of artists
and entertainment brands and properties. Providing an end-to-end merchandising
ecosystem, Bravado offers services including sales, licensing, branding, marketing,
eCommerce, and creative resources for clients and innovative experiences and products
for fans and superfans worldwide.
MUSIC IS UNIVERSAL Annual Report 2024 | 27
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
RECORDED MUSIC
UMG’s recorded music business discovers and develops artists; supports the creation of audio and
audiovisual content by recording artists; and markets, distributes, sells, and licenses this content
across a broad range of formats and platforms. UMG owns and administers copyrights to the audio
and audiovisual recordings created by recording artists signed to UMG’s iconic labels. We generate
revenue through the physical sales of this content in formats such as vinyl records, and CDs and
from its distribution to music streaming and subscription platforms. Our recorded music content is
also distributed to consumers through multiple other platforms and formats, including social media,
health and wellness, theatrical films, home entertainment, television productions, and video games.
Home to a diverse set of labels, brands and content
UMG is a leading recorded music company. We’re home to both world renowned record labels and
groups, and premier studio facilities. Our roster of recording artists features a diverse portfolio of
both global superstars and leading local artists from around the world. Artists signed to UMG as
part of our recorded music business span all musical genres and generations and include many
of the greatest recording artists of all time. UMG’s legendary label brands include Capitol Records,
Def Jam Recordings, EMI Records, Interscope Geffen A&M, Island Records, Mercury Records, Motown
Records, Polydor Records, Republic Records, Universal Music Group Nashville and Universal Music
Latin Entertainment. Our label portfolio also encompasses the world’s leading classical and jazz
labels, including Blue Note Records, Decca Records, Deutsche Grammophon and Verve Records. In
2024, UMG acquired the remaining 51% of the [PIAS] Group which it did not previously own, bringing
the [PIAS] Label Group and its associated record labels to UMG. We continue to launch new labels
in certain key markets where we believe there to be significant untapped opportunity, including Def
Jam Sweden, EMI Philippines, and UMG India’s launch of wellness music label Vedam Records during
2024. We are also home to the world’s premier recording studios, including the legendary Abbey
Road in London and Capitol Studios in Los Angeles. In 2024, UMG formed a strategic partnership
with UAE-based DGMC to develop a “Music City” in the Middle East, with plans to build three new
Capitol Studios.
Through Virgin Music Group, we offer a diverse range of premium and flexible independent label
and artist services to entrepreneurs and artists. These services span the spectrum, from global
distribution, insights, data and marketing tools, to fully staffed artist development teams at both the
regional and global levels. This flexibility enables us to foster long-term partnerships, and forges
paths to global success for entrepreneurs, independent labels and artists. In 2024, [Integral], the
independent distribution and services division of [PIAS] was merged with Virgin Music Group.
In addition to recorded music content, UMG develops a wide spectrum of audiovisual content for
distribution across the globe. Our more than 4,300 hours of audiovisual content spans a diverse mix
of genres and eras and features legendary artists represented within our rich and storied catalog
of content and intellectual property. We have two content divisions at the heart of our audiovisual
operations: Mercury Studios, a multi-faceted content studio, distributor and administer of UMG's
audiovisual catalog, and Polygram Entertainment, a premium production company. Beyond these, we
also have content operations within our individual labels and other business units. Some of our key
film projects in 2024 included
Queen Rock Montreal
(Mercury Studios),
Stax: Soulsville USA
(Concord,
WME, Polygram),
Lady Gaga’s Chromatica Ball
(Interscope),
One to One: John & Yoko
(Mercury Studios),
Olivia Rodrigo: GUTS World Tour
(Interscope), and upcoming scripted series
The Greatest
(Polygram).
In 2024, Mercury Studios launched two fast channels – GIGS with partner Samsung TV Plus in the
U.K/E.U, now on Freeform, and a Def Jam channel with Tubi in the U.S. celebrating the music label’s
40th anniversary. The fast channels are exclusive, free, ad-supported streaming channels featuring
live performances and documentaries from across UMG’s audiovisual catalog.
All corners of the globe
Our recorded music business is both artistically and geographically diverse. We have offices in more
than 60 territories, covering nearly 200 markets. This means we operate in more territories and
markets than any other recorded music company. Our wide geographical presence enables us to
create diversified revenue streams. In 2024, North America accounted for 52% of our recorded music
revenue, while Europe, Asia, Latin America and the rest of the world represented 28%, 12%, 5% and
3% of the revenue, respectively. Our extraordinarily diverse roster of artists in turn means that our
business’ success is not reliant on one artist or even a small number of artists. The top 50 artists
accounted for 24% of UMG’s recorded music revenue in 2024.
MUSIC IS UNIVERSAL
Annual Report 2024 | 28
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Multi-label structure enables entrepreneurs and encourages artistic diversity
UMG is home to many of the world’s most iconic record labels. We believe that operating multiple
major frontline labels in markets around the world yields significant benefits and that our multi-
label structure empowers entrepreneurialism, artistry, and diversity. This is why we continue to
develop, revitalize and invest in our label brands.
UMG encompasses a collection of iconic and world-class labels, spanning all genres of music,
created and led by visionary entrepreneurs. Our shared passion for discovering recording artists
with the talent and potential to break through an increasingly competitive environment for audience
attention is at the core of who we are and what we do. Each one of these dynamic labels has a
common belief: that an artist they discover and develop will change and drive culture across their
domestic market, their region and around the world.
This approach produces many benefits. Our collection of dynamic enterprises enables us to
effectively cover the music market across all genres and styles, with each label having its own
unique culture and history. Decentralized talent-spotting across UMG, employing each label’s
distinctive identity and creative vision, means we can attract the widest variety of top talent.
Our multiple label structure creates a degree of competition even between and among UMG
labels. This healthy competition drives innovation and creativity and keeps our labels continuously
evolving to stay at the forefront of industry trends. This structure also alleviates short-term
performance pressure on any individual label. The fact that the different UMG labels will collectively
have a continuous flow of new content means each individual label can take a more long-term
approach to artist development.
Benefitting from UMG’s networks and expertise
While our multi-label structure gives each label the freedom to create and innovate, our labels still
benefit from the reach and expertise that comes with being part of UMG. This is because at UMG,
we negotiate with platform partners, provide in depth data and analytics, share best practices, and
centralize many back-office functions at a company-wide level. This lets us benefit from our scale
and drive efficiency, while maintaining the spirit of a quick-moving, innovative and entrepreneurial
company. In 2024, we realigned our U.S. and UK frontline label operations to supercharge our
efficiency efforts.
Expanding touchpoints with artists and entrepreneurs through distribution
UMG enjoys longstanding relationships with leading distribution partners, including, for example,
Concord, HYBE and Disney, to give our partners’ artists global reach and best-in-class services. In
2024, UMG announced a long-term extension and expansion of its exclusive distribution agreement
with HYBE, and expanded its multi-year deal with Big Loud Records. In late 2024, UMG’s distribution
alliance with BMG commenced as UMG became the distributor of BMG’s recorded music in physical
formats, including vinyl and CD. Further collaborations are also underway, including BMG partnering
with Republic Records to amplify future releases from singer songwriter Jelly Roll, maximizing his
impact across genres and expanding marketing into new territories.
Diversified revenue streams
Our recorded music business has diversified revenue streams derived from three main
sources, including:
DIGITAL: We generate subscription and streaming revenue through partnerships that
enable UMG’s content to be distributed by global, regional and local digital service
providers, including Spotify, Apple, YouTube, Amazon, Deezer, Tencent Music Entertainment
and NetEase, among an increasingly important number of other partners. Our music is
streamed on an ad-supported and paid subscription basis through these streaming services. Fans
are also able to purchase downloads of our music by album or individual tracks through download
services.
We also generate subscription and streaming revenues from social media and short-form video
platform partners ranging from Meta, YouTube and TikTok to digital fitness partners such as Peloton
and Apple Fitness+ and gaming platforms, among other emerging digital platforms. We partner with
MUSIC IS UNIVERSAL
Annual Report 2024 | 29
RECORDED MUSIC
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
both established and emerging digital music services to provide ever-greater access to fans, who are
engaging with our music in multiple ways.
PHYSICAL: Our physical recorded music products, including vinyl records, CDs, cassette
tapes, and DVDs, are sold through retailers and wholesalers both in-store and online. We
also sell our products directly to customers via our UMG websites and artist channels.
These D2C channels have shown strong growth and are an increasingly important area
of focus for UMG. In 2024, D2C sales represented 19% of all physical music sales for UMG.
LICENSING AND OTHER: We enter into agreements to license the use of sound recordings
in combination with visual images, such as in films, broadcast television or SVOD
streaming series, television commercials and video games. As a rightsholder, consistent
with local law, we receive royalties in most territories when sound recordings are
performed publicly through broadcast of music on radio (over the air and via satellite), television,
and in public spaces such as shops, workplaces, restaurants, bars and clubs. We also partner with
artists to develop their activities outside the traditional recorded music business, and generate
revenue through participation in these expanded rights, including sponsorship, fan clubs, artist
websites, touring, concert promotion, ticketing and artist and brand management. We also develop
and produce music-based audiovisual content, such as music documentaries, feature films,
theatrical musical productions, music-based television series and reality shows, which are then
licensed for distribution.
Continued growth across all major recorded music revenue streams in 2024
In 2024, UMG achieved growth across all of its major recorded music revenue streams. Recorded
music revenue in 2024 was €8,901 million, up 5.2% year-on-year compared to 2023, or 6.4% in
constant currency.
We have played a prominent role in driving the recorded music industry’s transition to recurring
and more predictable paid subscription streaming models from a model based solely on physical
and digital purchases. Streaming and subscription revenue grew 5.9% year-on-year, or 6.8% in
constant currency, and accounted for 68% of UMG’s 2024 recorded music revenues. Subscription
revenue saw growth of 8.2% year-over year, or 9.1% in constant currency, driven by the growth in
global subscribers as well as impact of price increases at certain platforms. Ad-supported streaming
revenues declined 0.8% year-on-year, but grew by 0.1% in constant currency, as the consumption
grows but continues to shift from better monetized video platforms to short-form platforms, which
are not yet as well monetized.
Physical revenue decreased by 1.6% year-on-year, but grew by 1.1% in constant currency. License
and other revenue improved 12.9% year-on-year, or 13.5% in constant currency, as a result of
improved live, brand sponsorship, neigbouring rights and synchronization income, as well as certain
legal settlements, whilst the prior year included the timing related benefit of a new licensing deal.
Importantly, UMG also prioritizes developing new and diverse revenue sources, partnering with
local and global entrepreneurs to derive income from as many new, innovative places as possible.
Driving groundbreaking formats for music consumption has not only benefited our songwriters,
artists, fans and shareholders, it has solidified our role as the industry leader. It’s also supercharged
marketing and revenue development via highly-bespoke partnerships, like ABBA Voyage (a live, life-
like performance of ABBA avatars), U2’s opening residency of the Los Vegas sphere, or medrhythms,
a music-based neuritherapuetic device redefining what’s possible in brain healthcare, to name only
a few.
Culture-defining global, regional and domestic superstars
Our recorded music business operates in more territories and markets than any other recorded
music company. The breadth and depth of our artist roster is unrivaled. We’re the destination of
choice for the world’s most successful stars and a clear partner for up-and-coming artists. We
help local artists succeed in their home market and grow their fan base to a global one. With
a roster featuring legends, global hitmakers, regional stars and breakthrough artists, our artists
span generations, genres, languages, continents and cultures. UMG’s best-selling artists include
global superstars such as J Balvin, Jon Batiste, Justin Bieber, Luke Bryan, BTS, Lewis Capaldi, Sabrina
Carpenter, J. Cole, Drake, Billie Eilish, Eminem, Cynthia Erivo, Selena Gomez, Ariana Grande, Imagine
MUSIC IS UNIVERSAL
Annual Report 2024 | 30
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Dragons, Lady Gaga, Noah Kahan, Kendrick Lamar, Lana Del Rey, Lil Baby, Post Malone, Shawn Mendes,
Metro Boomin, Nicki Minaj, Karol G, Katy Perry, Max Richter, Rihanna, Chappell Roan, Olivia Rodrigo,
Sam Smith, Chris Stapleton, Taylor Swift, Shania Twain, Morgan Wallen and The Weeknd. Our roster
of artists also includes hugely successful local artists such as The Cure, English Teacher, Glass
Animals, The Last Dinner Party and Stormzy in the UK, Angèle, Zaho de Sagazan and SDM in France,
Shirin David, Helene Fischer, Herbert Grönemeyer and Luciano in Germany, Ado, King & Prince and
Mrs. GREEN APPLE in Japan, Eason Chan and Jay Chou in China, Hanumankind in India and Anitta,
Feid, and Sebastián Yatra in Latin America. In addition, in 2024, we welcomed AP Dhillon, Kings of
Leon, Miranda Lambert, Carin León and Jelly Roll, among many others, to the UMG family.
Our recorded music artists once again topped the global charts in 2024. UMG had:
■
On Spotify
Wrapped
: Six of the Top 10 global artists, with Taylor Swift at No. 1 and the Weeknd at
No. 2, as well as Drake, Billie Eilish, Ariana Grande and Feid; five of the Top 10 songs with Sabrina
Carpenter’s “Espresso” at No. 1; and eight of the Top 10 albums with Taylor Swift at No. 1 with The
Tortured Poets Department.
■
On Apple Music: Six of the Top 10 most-streamed songs with Kendrick Lamar at No. 1, and Billie
Eilish named Artist of the Year.
■
On Deezer: Four of the Top 5 artists with Taylor Swift at No. 1.
■
On Vevo: Eight of the Top 10 artists, including Karol G at No. 1 for the fourth consecutive year.
■
On Amazon Music: Taylor Swift was the Top artist and The Tortured Poets Department was the Top
album. UMG also had seven of the Top 10 most requested artists on Alexa with Taylor Swift at No. 1,
followed by Eminem, Morgan Wallen, Olivia Rodrigo, Karol G, Billie Eilish and Drake.
Industry-leading catalog of timeless recordings
Our track record in identifying and partnering with the world’s best artists has given us the
industry-leading catalog of recordings and songs. These include timeless performers such as ABBA,
Aerosmith, Louis Armstrong, The Beatles, The Beach Boys, The Bee Gees, Andrea Bocelli, Bon Jovi,
James Brown, Nat King Cole, Neil Diamond, Marvin Gaye, Guns N’ Roses, Elton John, KISS, Bob Marley,
Paul McCartney, Nirvana, Luciano Pavarotti, Lionel Richie, The Rolling Stones, Frank Sinatra, Sting,
U2, The Who, Amy Winehouse and Stevie Wonder. This diverse catalog gives UMG strong and reliable
revenue from sales of prior years’ releases.
Catalog sales (defined as content older than three years) accounted for 66% of recorded music digital
and physical revenue in 2024, while frontline product (content less than three years old) accounted
for 34% of recorded music digital and physical revenue.
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RECORDED MUSIC
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MUSIC PUBLISHING
Universal Music Publishing Group (UMPG) is UMG’s global music publishing business and is home
to the world’s greatest songwriters and song catalog. We’re recognized as one of the leading
and fastest-growing music publishing companies globally. Our core activities include: discovering,
identifying, and developing some of the best songwriters in the world; publishing and acquiring
rights to musical compositions; and licensing them for use in different formats.
With a global roster of talent spanning genres and geographies, UMPG’s team works closely alongside
our artists to amplify their careers and build worldwide success. We license musical compositions
for use in sound recordings, films, television shows, advertisements, video games, concerts, and
other public performances and for use in printed sheet music and song folios. Our vast catalog
of original music and arrangements has incredible breadth and diversity. We enjoy longstanding
relationships with leading film and television studios, global brands and digital service providers
who use our music and arrangements in their content and products.
Creating best-in-class service for both global and local songwriters
Songwriters are at the heart of everything we do at UMPG. We are dedicated to giving them best-in-
class service and maximizing their royalty streams. To achieve this, we deploy both the hands-on
expertise of the industry’s best people and cutting-edge technology to maximize opportunity and
value for our songwriters both commercially and creatively. We combine global reach and a local
presence, with over 850 employees operating at 48 offices in 40 countries. These teams focus on
discovering, signing and developing talent and creating unique opportunities for success on a local,
regional or global scale. This physical presence is vital in maintaining relationships with collection
societies worldwide to ensure all generated income is accounted for and collected on behalf of
songwriters and copyright holders. As part of the world’s largest music company, we are uniquely
positioned to develop collaborative strategies between publishing and recorded music. All with one
aim: to bring value to our songwriters.
Embracing technology responsibly songwriters
We deploy cutting-edge technology and expert administration services to benefit our songwriters.
Through our highly advanced technology platform, UMPG Window, we provide our songwriters and
clients with real-time information on earnings, royalty and copyright data. This advanced system
reflects UMPG’s longstanding commitment to transparency, integrity and trust. UMPG Window uses
the latest in cloud-indexing technology to provide comprehensive views of where, when and how
songs are consumed around the world. UMPG Window also features: one-click, no-fee advances;
international royalty ‘pipeline’ income views; society registration information, status, and full
copyright details on all works; comprehensive film and TV information for works used and royalties
earned; and numerous other powerful tools to help our songwriters and clients.
Partnering with top film and TV content studios
We’re a leading publisher in the film and television business. UMPG partners with most major
film and TV content studios ranging from Warner Bros., NBCUniversal, Disney and HBO to Amazon,
MGM, Banijay, Paramount, Lionsgate and Univision, among others. In 2024, we completed a major
agreement with CBS and extended our deal with Warner Bros., among others. This leading position
means we represent some of the world’s most iconic film and TV theme songs.
Multiple revenue streams
Our music publishing business derives revenue from five main sources, including:
PERFORMANCE: The rightsholder receives revenues when the musical composition is
performed publicly through broadcasting of music on television or radio, and during a live
performance at a concert or other venues such as nightclubs, bars, restaurants, hotels and
retailers.
DIGITAL: The rightsholder receives revenues when musical compositions are distributed
through audio and visual streaming services, download services, social networks and
other digital music services.
MECHANICAL: The rightsholder receives revenues for musical compositions embodied
in recordings sold in any physical format or configuration such as CDs, vinyl and DVDs.
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SYNCHRONIZATION: The rightsholder receives revenues for the right to use the musical
composition in combination with visual images such as in films or television programs,
television commercials and video games as well as from other uses such as in toys or
novelty items and merchandise.
OTHER: The rightsholder receives revenues for use of the musical composition in sheet
music and other uses.
Music publishing is a recurring growth business
Music Publishing revenue amounted to €2,121 million in 2024, up 8.4% year-on-year, or 9.0% in
constant currency. Revenues benefited from the continued growth in subscription and streaming
and an improvement in performance income.
Another chart-topping year
Our songwriters continued to top the charts around the world in 2024.
■
On Spotify
Wrapped
, globally: UMPG had all of the Top 5 artists (Taylor Swift, The Weeknd, Bad
Bunny, Drake, Billie Eilish) and seven of the Top 10; an interest in four of the Top 5 albums (Taylor
Swift, Billie Eilish, Sabrina Carpenter, Ariana Grande) and eight of the Top 10; and four of the Top
5 songs.
■
On Apple Music: UMPG had an interest in eight of the Top 10 most-streamed songs globally and
seven of the Top 10 in the U.S.
■
On TikTok: UMPG had three of the Top 5 artists in the U.S. with Sabrina Carpenter, Ice Spice and
Billie Eilish.
■
On Billboard’s list of Hot 100 Songwriters in the U.S., UMPG had three of the Top 5 with Taylor Swift
(No. 1), Jack Antonoff (No. 2) and Kendrick Lamar.
Unparalleled collection of songs in every genre
UMG is home to the greatest songwriters in history. We have a global catalog containing more than
five million owned and administered copyrights. Our unrivaled catalog is a rich mosaic of songs
spanning myriad eras, generations, genres and languages. We take a portfolio approach to growing
and managing our catalog. As a result, we have a mix of songwriters from around the world, with
works in our catalog inclusive of every genre – from country to Latin to pop to urban to K-pop and
J-pop. Our catalog is filled with evergreen songs spanning generations from “Like a Rolling Stone” to
“Every Breath You Take” and from “All I Want for Christmas” to “Stayin' Alive”. This combines to create
an ever-evolving portfolio that is unmatched in terms of its richness and diversity.
Our music publishing catalog includes some of the world’s most popular songs from major
songwriters and artists such as ABBA, Adele, Jack Antonoff, ATL Jacob, Bad Bunny, J Balvin, Beach
Boys, Beastie Boys, Bee Gees, Louis Bell, Irving Berlin, Leonard Bernstein, Jeff Bhasker, Justin Bieber,
Benny Blanco, Nicholas Britell, Chris Brown, Tommy Brown, Mariah Carey, Brandi Carlile, Sabrina
Carpenter, Michael Chabon, Nija Charles, Kenny Chesney, Desmond Child, Cirkut, The Clash, Dave
Cobb, Coldplay, Luke Combs, Lana Del Rey, Alexandre Desplat, Neil Diamond, Disclosure, Drake, Dua
Lipa, Bob Dylan, Billie Eilish, Danny Elfman, Eminem, Gloria and Emilio Estefan, Omer Fedi, Feid,
Florence + the Machine, Fred again.., Future, Martin Garrix, Selena Gomez, Ariana Grande, Al Green,
Josh Groban, Kid Harpoon, Emile Haynie, Jimi Hendrix, Don Henley, H.E.R., Hit-Boy, Sam Hunt, Ice
Spice, Carly Rae Jepsen, Rodney Jerkins, Tobias Jesso Jr., Billy Joel, Elton John/Bernie Taupin, Joe
Jonas, Alicia Keys, David Kushner, Carin León, Steve Lacy, Kendrick Lamar, Lil Baby, Lil Yachty, Linkin
Park, Logic, Lorde, Demi Lovato, the Mamas & the Papas, Steve Mac, Maroon 5, Dave Matthews,
Megan Thee Stallion, Shawn Mendes, Metallica, Metro Boomin, Julia Michaels, Miguel, Maren Morris,
Mumford & Sons, Nas, Randy Newman, New Order, Pearl Jam, Post Malone, Elvis Presley, Prince,
Quavo, Otis Redding, R.E.M., Red Hot Chili Peppers, Rex Orange County, Lionel Richie, Maggie Rogers,
Rosalía, Carole Bayer Sager, Gustavo Santaolalla, Schoolboy Q, Carly Simon, Blake Slatkin, Britney
Spears, Stax (East Memphis Music), Sting, Harry Styles, Swedish House Mafia, Taylor Swift, SZA, Take a
Daytrip, Justin Timberlake, Shania Twain, U2, Keith Urban, Michael Uzowuru, The Weeknd, Jack White,
Yahritza, Frank Zappa and Zedd.
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Key signings in 2024 included Mark Ronson, Mark Ambor, Finneas, Aaron Dessner, Andrea Bocelli,
Yusuf/Cat Stevens, Lord Huron, Matraca Berg, Geovani Cabrera, Jerskin Fendrix and more. We also
completed major agreements with CBS, extended with Warner Bros. and, as of the end of 2024,
globally administer the Chord catalog on behalf of Chord Music Partners.
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MERCHANDISING
Developing innovative cultural and retail experiences for fans
Bravado is UMG’s global, full-service merchandise business. With a portfolio spanning over 220
artists and labels, we hold the leading position in music merchandise worldwide. Through Bravado,
we develop high-quality licensed consumer products that reflect and reinforce an artist’s brand
and identity and present them to a worldwide audience. Our artists and brands have access to a
unique end-to-end merchandising ecosystem that brings together creative design, production, and
distribution. We work closely with new and established clients to create innovative products that
are carefully tailored to the brand or artist. Our products include apparel and accessories, home
goods, toys, games, luxury goods, food and other retail merchandise. They are sold through selected
retail outlets and web-based stores, both directly and through third parties, and on live tours. By
tapping into UMG’s global network, we can offer a comprehensive range of services, including sales,
licensing, branding, marketing, eCommerce and creative resources.
Sparking connections with fans
With a focus on building connections between artists and their fans, our in-house creative
development team at Bravado works closely with new and established artist-clients to create
innovative products carefully tailored to the brand or artist. Our creative team operates at the
intersection of art, music and fashion – identifying key trends in all three areas and creating
compelling products and experiences that are in tune with today’s culture. As part of a world-
leading music-based entertainment company, we’re uniquely positioned to create fresh and exciting
products that match an artist’s brand and identity. For example, for her GUTS World Tour in 2024,
Olivia Rodrigo collaborated with Bravado to create hundreds of customized merch products authentic
to her wider GUTS world, including city specific T-shirts and posters collaborating with local artists,
and jewelry based on the set design from the GUTS World Tour.
Building our D2C business
We are excited about scaling our D2C capabilities and monetizing superfans. We are building our
"owned" audience and reinforcing our labels’ core artist brand building capabilities in consumer
products and live experiences. Our "owned" audience, which refers to the segment of customers
registered to receive marketing materials from our owned and operated websites, has grown to over
200 million fans, as we have expanded into additional territories. The growth of our D2C business
continues to be driven by our expanding global footprint of online artist stores, our developing
supply chain infrastructure, and our increasingly sophisticated customer data capabilities. In 2024,
36% of our merchandising revenue was sold through D2C channels.
Global retail
We have developed the most extensive global distribution network in the industry. Our strong
direct relationships in the retail sector and ability to curate a mix of products and experiences
hold the key to our success. Our global and in-market local teams work in close collaboration to
manage our brands consistently and effectively across all markets and countries. Thanks to this
localized approach, our activities are tailored to each individual market to achieve maximum reach
and results.
Licensing
Our licensing services extend the scale and scope of our brands into categories beyond apparel and
traditional consumer products. We leverage dynamic partnerships across a range of platforms and
categories from footwear and accessories to gaming and spirits. Working closely within an extensive
global network of best-in-class licensees, we develop dynamic brand partnerships that reach new
and diverse audience segments without diluting the artist’s brand.
Compelling fan experiences
Through pop-ups and unique experiential events, Bravado connects artists with fans around the
world, creating unforgettable moments that maximize fan engagement. In 2024, Bravado engineered
numerous compelling fan experience which included the exclusive “Bob Marley: One Love,” pop-up
experience at Outernet; Charing Cross Road in London; Anitta’s AVIP Experience in Madrid for Pride
Experience; Olivia Rodrigo’s GUTS World Tour Bus Experience; and Billie Eilish’s Hit Me Hard And Soft
pop up stores around the world including New York, Tokyo and Mexico City, along with so much more.
Multiple revenue streams
Our merchandising revenues are derived from four main sources:
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TOURING INCOME: Sales of physical merchandise products directly to consumers at
venues during tours. This also includes concession income, which is the sale of physical
merchandise products directly to consumers at concessions within venues. The right to
sell at concession is not limited to specific tours, Bravado signed artists or music events,
but can also encompass other events within venues.
RETAIL: Sales of physical merchandise products to wholesalers and retailers.
LICENSING: Fees received from third party licensees to use our merchandising rights in
products sold by or sub-licensed by the licensee.
ECOMMERCE/D2C: Sales of physical merchandise product through our more than 1,000
online D2C artist / brand stores. This also includes VIP events and fan clubs, which is
the sale of premium experiences and exclusive access through a D2C channel.
Strong growth in 2024
Bravado signs agreements with clients that provide for usage rights of the client’s name, image
and likeness across product categories and distribution channels. In 2024, Merchandising and other
revenue grew to €842 million, up 19.3%, both year-on-year and in constant currency, driven the
strong growth in D2C sales and touring merchandise sales.
Roster of clients with the greatest names in music
Our merchandising roster of clients includes some of the biggest names in music. We provide
merchandising services for leading artists including 21 Savage, Aerosmith, Anitta, Ariana Grande,
Billie Eilish, BLACKPINK, Bob Dylan, Bob Marley, Britney Spears, David Bowie, Elton John, Guns N’
Roses, Justin Bieber, Kali Uchis, KISS, Lady Gaga, Metro Boomin, Morgan Wallen, Olivia Rodrigo, Post
Malone. Queen, Selena Gomez, Taylor Swift, The Beatles, The Rolling Stones, Travis Scott, Shania Twain,
Shawn Mendes, The Weeknd and The Who.
In 2024, Bravado continued to broaden its global roster, signing, or beginning new relationships with
artists including; Blink-182, Kendrick Lamar, Karol G, Nine Inch Nails, Tim McGraw, Paramore and
many more.
A number of Bravado artists are also signed across other UMG businesses, allowing for synergies and
increased opportunities for artists. And for those Bravado clients who are not in the UMG-family, our
work holds potential to ultimately expand those relationships and bring them into the UMG family.
Commitment to sustainability
Bravado seeks to advance climate action across the industry and drive progress toward UMG’s
Science-Based Targets. We have created, produced and hosted UMG x Bravado Sustainability
Summits in Los Angeles, London, and New York, the first music industry sustainability summits. The
summit series brought together industry leaders and innovators in sustainable solutions to share
ideas and drive change.
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STRATEGY
CREATIVITY, INNOVATION, ENTREPRENEURSHIP
As the world leader in music, we are guided by our key principles of creativity, innovation and
entrepreneurship, and are driven by a commitment to help songwriters and artists thrive and
connect with their fans all over the globe.
UMG’s creative and commercial foundation has a proven track record of building sustainable long-
term value for our stakeholders and is built on a set of key pillars, most notably:
■
Continuing to discover and break new artists and songwriters and supporting them at every stage
of their career to help them achieve their greatest creative and commercial potential.
■
Maximizing and protecting the value of our extraordinary catalog, both now and in the future.
■
Driving growth in subscription and ad-supported streaming revenue around the world and
expanding our capabilities and repertoire in high-growth markets.
■
Building winning partnerships with tech innovators to create innovative new commercial
opportunities and explore how technology can be used to benefit our artists in creating product,
driving engagement and discovery, further fueling fandom and consumption.
■
Working to maximize the power, influence and impact of music to drive social conversation.
■
Progressing thought leadership on key industry issues and public policies to help maintain a
vibrant and growing music ecosystem.
■
Advancing data and insights, to help fuel discovery, furthering our ability to connect our artists
with their fans anywhere in the world, and to identify superfans.
■
Enhancing our capabilities to comprehensively serve and maximize the value of superfans
through D2C/eCommerce/product development, increasing monetization.
With each of these areas creating expansive opportunities, our artists and songwriters remain the
cornerstone for our labels, businesses, and brands. In addition, we are committed to sustainability
in our business and across our industry, working to reduce our environmental footprint and
generating a positive cultural handprint. For detailed sustainability-related information, see our
Sustainability Statement.
Throughout 2024, UMG continued to make progress in all of these strategic areas - redefining the
model for streaming, protecting artist and songwriter rights, building winning partnerships with
tech innovators, seizing upon the opportunities of new technologies like AI, boosting our presence
and capabilities in high-growth markets, discovering new ways to build audience using our data,
leveraging our unprecedented catalog even further, and leaning into consumer, commerce and
superfan monetization.
And, of course, we continue to break new artists, time and again, in all genres and categories and in
markets around the world. We are proud of the breadth and success of these strategic initiatives and
investments, as UMG remains best positioned to realize the extraordinary potential that lies ahead
for the industry.
Deepening our local-global approach
We are a global company built on expertise and relationships with local music communities around
the world. Local repertoire is historically the most successful repertoire in music markets spanning
the globe. In 2024, UMG continued to expand its repertoire, reach and capabilities in some of
the world’s most exciting and dynamic global music markets. We are committed to expanding
our presence and accelerating our growth in both high-growth potential markets and far-reaching
regions to discover exciting new music and artists globally, expand our catalog and repertoire, create
opportunities to connect with local music fans, help introduce new music to global audiences and
further benefit from the growth to come in these markets.
Why it matters: Our diverse and long track record of worldwide successes helps us continually
attract new talent to our roster. New talent will always be integral to our future success. The more
those artists reflect the local culture for the consumers and communities we serve, the more those
fans will connect to their music, including in high-potential markets like India, the Middle East, West
and Sub-Saharan Africa, and Greater China.
Expansion strategy: UMG continues to expand our global reach by investing in local markets. We are
doing that in three ways: local artist investment; local label partnerships; and acquisitions.
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Local artist investment: Through a multi-label frontline approach, we sign and develop local artists,
while building a roster of the best talent each region has to offer, just as we do in more established
music markets.
Partnerships: We partner strategically with leading local labels, artist managers and entrepreneurial
companies to support and boost them with global promotion, distribution and a full suite of
artist services.
Acquisitions: Through M&A, we acquire local labels, catalogs and artist services businesses.
In February 2024, we announced a majority investment in of one of the world’s most dynamic
and exciting independent record labels, Mavin Global (Mavin). The Lagos, Nigeria-based label is the
driving force behind many of the continent’s most successful Afrobeats artists. Founded in 2012
by renowned artist, producer, music executive and entrepreneur, Michael Collins Ajereh (aka Don
Jazzy), Mavin has played a pioneering role in breaking Afrobeats artists within Africa, and beyond. The
multi-award-winning label has enjoyed rapid growth, alongside commercial success – contributing
to the global rise of Afrobeats. The partnership accelerates Mavin’s strategic advancement, creates
more opportunities to break more talent globally, expands the reach of its existing roster and
continues building its business into a pan-African entertainment company.
Mavin is home to a number of accomplished artists including Ayra Starr, Lifesize Teddy and Rema,
whose hit single “Calm Down” [featuring Selena Gomez] is the biggest Afrobeats song of all time and
holds the record for the most viewed video of all time by an African artist on YouTube, as well as
being the first African artist-led track to surpass 1 billion Spotify streams and views on YouTube.
Founder and CEO Don Jazzy and CEO, Tega Oghenejobo continue to lead the company, which gives
UMG the opportunity to partner with proven local executives and experienced A&R professionals,
further strengthening UMG’s position in Africa.
In January 2024, UMG announced an agreement to purchase the catalog of iconic UK-based South
Asian record label Oriental Star Agencies (OSA), including all of the label’s recordings and publishing
rights. A slice of over 50 years of South Asian culture and heritage, the catalogue comprises
approximately 18,000 song, concert and video recordings, featuring legendary and genre defining
Pakistani and Indian artists.
In recent years, Virgin Music Group ("VMG") has partnered with some of the most dynamic artists and
labels in Latin music to achieve critical and commercial success, most notably with Eslabon Armado
(DEL Records), whose smash single “Ella Baila Sola” achieved chart-breaking success, becoming one
of the biggest global music stories of last year and kickstarting a phenomenal global breakout for
música Mexicana. In early 2024, VMG announced the acquisition of Saban Music Latin, including the
catalog and future albums by artists including: German Montero; Fuerza De Tijuana; Reykon; Jon Z;
Almighty; Jesus Mendoza; Banda Cruz De Oro; Michael Stuart; Abel Zazueta Y Los De Culiacan.
Then in July 2024, Socios Music, the record label of influential rising global artist Carín León,
announced the formation of a unique partnership with VMG and Island Records to release new
music. Carín León, an award-winning artist from Hermosillo (in northwestern Mexico’s state of
Sonora), has a discography of globally charting songs that seamlessly blend genres across a
discography boasting millions of streams, including the Latin Grammy winning song “Como Lo Hice
Yo,” and a string of massive hits like “Ni Me Debes Ni Te Debo” , “Te Lo Agradezco” , “No Es Por Acá”,
and more.
In Thailand, a key music market in Southeast Asia, UMG completed the full acquisition of RS Group,
which includes Thailand’s second largest music catalog with over 10,000 master recordings, 6,000
copyright ownerships, publishing rights, and licenses spanning four decades, as well as a leading
Thai music distributor and a management company.
Spotlight on China
In 2024, under the leadership of Timothy Xu, Chairman & CEO for Universal Music Greater China, we
continued to strengthen and grow our business operations across Greater China, one of the world’s
fastest growing and most dynamic music markets, with a series of new strategic partnerships, local
artist signings and the launch of a new strategic division, Universal Music China Greater Bay Area,
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covering China’s Greater Bay Area including Hong Kong and Macau. This pioneering initiative marks
the first time a major music company has established a division in China’s Greater Bay Area, the
world’s largest and most economically vibrant urban cluster, with its new headquarters in Shenzhen.
Universal Music Greater China now has offices in Beijing, Hong Kong, Shanghai, Shenzen and Taiwan
to fully support the next phase of growth across the region.
In November, we announced a landmark strategic distribution agreement with Modern Sky, China’s
prestigous independent music label that will provide Modern Sky’s extensive catalog and roster of
artists with access to UMG’s worldwide distribution network. It is also opening doors for expanded
collaboration between the two companies, elevating and introducing China’s original music and
vibrant youth culture to international audiences. Founded in 1997, Modern Sky is a pioneer in
China’s music scene and a trendsetter within the country’s youth culture. The label boasts a
massive catalog of original songs, with hundreds of new tracks added each year. For over two
decades, Modern Sky has been instrumental in shaping China’s indie music movement, producing
over 500 albums and working with some of the country’s most influential bands and artists.
Currently, Modern Sky is home to a roster of over 150 acts, including emerging talents who have
broken onto the scene in recent years with a diverse range of musical genres and an increasingly
global perspective, embodying the dynamic voices of China’s young generation.
In 2009, Modern Sky launched the Strawberry Music Festival, becoming China’s first large-scale
outdoor music festival. Today, the company organizes over 30 music festivals annually and more
than 1,000 performances across China.
During 2024, several other exciting agreements and signings were announced within Greater China,
including: iQIYI, China’s leading online entertainment platform, under which UMGC will exclusively
distribute worldwide the new releases from contestants of “The Rap of China 2024”, while providing
them with an integrated support network. Produced by iQIYI, “The Rap of China” series is the first
Chinese reality program to adopt a narrative-driven episodic format, focusing on young Chinese rap
talent. Since its debut in 2018, the show has become a cultural phenomenon in China, sparking a
nationwide rap craze. As one of China’s most successful youth culture brands in recent years, “The
Rap of China” series has successfully launched the careers of numerous outstanding rap artists.
In April, we announced a strategic agreement with TF Entertainment, the driving force behind China’s
premier idol sensations TFBOYS and Teens In Times, that includes global digital distribution for TF
Entertainment's roster of talent, targeting markets outside Mainland China to further elevate C-pop’s
prominence on a global stage. Since its inception in 2009, TF Entertainment has been a pioneer in
China’s pop culture landscape, introducing the trainee system to cultivate idol groups.
Additionally, in October, Virgin Music Group announced the acquisition of Outdustry, a leading
artist and label services and rights management business focused on China, India, and other
high-potential markets. The acquisition brings Outdustry’s decade-and-a-half experience in these
dynamic markets into VMG, where it will continue to operate its marketing services, publishing
company, and label businesses under the Outdustry brand.
Enhancing our capabilities to maximize the value of superfans
The deep and passionate connection between artists and their fans – “super-fandom” - is a core
component of music industry economics. Unlocking the power and maximizing the value of the
superfan has been at the heart of UMG’s growth strategy for many years, utilizing UMG’s best-in-
class data to expand our direct fan audiences and better understand fan behavior.
This has allowed us to innovate and better leverage our iconic catalog to continue to introduce
our artists to new audiences and markets. Consider also that superfans, a growing and influential
category of music enthusiasts, spend 80% more each month on music than the average listener,
based on Luminate data.
These fans drive increased activity both on platforms, but also through UMG’s rapidly growing D2C,
eCommerce and merchandising businesses, which represent a significant opportunity for UMG to
grow authentic engagement between fans and the artists they love.
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We are also engaging superfans with new products and experiences that unlock their
spending potential, and we are seeing dramatic growth in revenues that are complementary
to streaming. These include premium music and merchandise collectibles and innovative
superfan experiences.
We see an especially exciting opportunity to serve superfans through D2C channels and we are
expanding our capabilities to do so. We will identify and serve superfans across multiple channels
but more and more of this business, particularly in physical formats, will continue to be direct-to-
consumer.
In recent years, the launch of UMG’s own dynamic global eCommerce platform has enabled its
D2C, digital goods, merchandise and eCommerce divisions to accelerate and amplify artists’ ability
to create experiential, commerce and content offerings for their fans. The platform is already
supporting more than 1,000 artist stores globally, helping to rapidly grow UMG’s D2C revenues and
enabling us to build our owned audience of more than 200 million fans, as we have expanded into
additional territories. UMG is leaning further into eCommerce and focusing efforts towards building
an enhanced and holistic fan-centric ecosystem for UMG artists, providing them with a robust
network of tools and services to build comprehensive global campaigns that will help them reach
fans around the world.
UMG is actively increasing its global audience and customer footprint, connecting with music fans
and superfans around the world in order to retain and deliver subscribers and fans access to the
experiences and products they want the most.
The superfan D2C opportunity is not just a complementary, high growth revenue opportunity; it’s
also an important competitive advantage that is increasing our appeal to artists and giving us the
capability to do more for them than our competitors.
We are actively growing our global superfan business, introducing and developing more products
and experiences for our most passionate and engaged fans. Examples of these include physical
product collectibles, high-end merch collabs such as Billie Eilish’s ongoing collaboration with Nike x
Billie, and Olivia Rodrigo’s House Party on Roblox.
In 2024, UMG invested in NTWRK, the premium live-video shopping platform and curated
marketplace serving buyers and sellers. As part of this investment, NTWRK then acquired publisher
Complex to create a new destination for superfan culture that will define the future of commerce,
digital media, and music. The acquisition marks the next generation of Complex’s leadership as a
publication reaching young audiences about the trends, products, and styles they love. By marrying
an eCommerce platform anchored in sneakers, streetwear, and collectibles with content and music,
the new company will transform into a digital hub at the forefront of convergence culture. The
deal will allow Complex to leverage NTWRK’s marketplace and access culture-obsessed consumers
to create a one-of-a-kind experience for a highly engaged audience. This partnership will give
our artists access to a dynamic network to deepen connections with superfans through unique
collaborations and cultural moments.
Continuing to drive the music industry forward
Music as an industry is constantly evolving. We strongly believe we have the right formula to stay in
front of that evolution.
As part of our industry leadership, we are focused on helping to maintain a thriving and sustainable
global music ecosystem; continuing to redefine the streaming model in order to create greater
value for artists, fans, music companies and platforms; while protecting and reinforcing the value of
human artistry and creativity.
At our Capital Markets Day in September 2024, UMG once again distinguished itself with our thought
leadership and action, setting out a clear path for both UMG and the broader industry in the
coming years:
■
Ushering in the next era of streaming growth with “Streaming 2.0” and “Artist-Centric Phase 2”.
– Since first pioneering the “Artist-Centric approach” to streaming model innovation in 2023,
UMG has continued to explore the broader possibilities that it could unlock. “Phase One” saw
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the concept being embraced and adopted in various forms by digital service providers (DSPs),
social platforms, as well as other music companies. “Phase Two” will help bring in a new era of
premium-subscription and superfan engagement.
■
Continuing our industry-leading push to define and establish Responsible AI for the benefit of
all artists.
■
Exploring new creative and commercial avenues for monetizing music well into the future.
Introducing Artist-Centric Phase 2 and Streaming 2.0
The Artist-Centric principles first spearheaded by the company continued to progress in 2024, as
they became more broadly embraced by DSPs. The initial focus in Phase 1 was:
■
Ensuring that real artists with real fan bases are better recognized and rewarded for the platform
engagement they drive and value they create.
■
Protecting an artist’s music and royalties from systematic streaming fraud, manipulation
and misattribution.
■
Better differentiating music from the flood of noise that has accelerated in recent years,
all of which undermines the user experience, diminishing discovery and diluting authentic
fan engagement.
The first phase began in 2023 with streaming DSPs adopting and exploring Artist-Centric principles.
The engagement here included Deezer and Spotify, as well as Tidal and SoundCloud, as platforms
looked to better reward real engagement by creating a bespoke model that better reflects its own
fan-driven consumption and listening experience.
In 2024, UMG continued to lead the industry forward, innovating further with groundbreaking deals
and collaborations with Amazon, Meta, TikTok, Snap and others that helped apply “Artist-Centric
principles” beyond just subscription streaming and into social listening and other categories.
UMG is now actively advancing our artist-centric philosophy with a number of key partners to meet
the opportunities for future growth in paid streaming, and continuing to move the market forward by
building innovative new superfan focused product offerings with our partners. We call this focus on
growing revenue by harnessing high-value fan engagement “Artist-Centric Phase 2.”
UMG has been working closely with partners on the development of a compelling set of new features
that could form a Super-Premium subscription tier that will help elevate the listener experience and
further deepen artist-fan engagement. In the future, we expect Super-Premium tiers to be deployed
by most streaming platforms – enhancing the user experience, bringing fans closer to the artists
they love, and significantly increasing subscription revenue for artists. The best way to characterize
our vision for streaming’s transformation through innovation is to frame the evolution of the market
from Streaming 1.0 to Streaming 2.0.
Charting the transformation of our business over the past decade, it was essential to drive market
evolution by focusing on a simple and appealing value proposition for subscription streaming, with
services effectively marketing this clear and compelling Streaming 1.0 product. During Streaming 1.0,
market adoption has scaled dramatically. However, the simplicity of this model - with all streams
being equal - has precipitated problems with volume prioritized over value. We believe that the
Streaming models must adapt to embrace change.
Under Streaming 2.0, we elevate our focus on maximizing customer value, while also continuing to
grow the subscriber base. In Streaming 2.0, customer segmentation driven by product innovation is
critical. We are focused on how best to drive customer acquisition via free tiers while also improving
their economics, as we realign the subscription model around the core value driver of authentic
artist-fan relationships, and ultimately capture higher customer value through super premium tiers
of service.
Subscriptions and ad-funded streaming have been primary growth drivers of our business over the
last ten years and will continue to be engines of growth going forward – but growth in the years
ahead will also be driven by targeting the superfan opportunity and through our partnerships with
a broad array of businesses fueled by music. This is how we further address our goal of broadening
and deepening monetization in the era of Streaming 2.0.
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The big picture: The economics of streaming is a vastly more complex subject than it was at the
infancy of the format nearly two decades ago. Artist-Centric and Streaming 2.0 address many aspects
of the traditional streaming model that have come to need revision in order to create better equity
for the artists who drive value for digital service providers. Over the past two years, spearheaded by
UMG, the Artist-Centric approach has gained significant momentum as the driver for that change.
Why it matters: The work and value of artists has become increasingly diluted on digital platforms by
an oversupply of content, much of it merely noise and increasingly more of it associated with fraud.
This situation has become even more pronounced with the increased availability of unlicensed,
generative AI technology.
This has served to drown out the real music that fans actually want to hear. The principles of an
Artist-Centric approach to streaming were conceived by UMG to better reward music artists and
songwriters that inspire audiences and drive the most engagement, not the bots and white noise
diluting that experience.
The details: While there is a significant degree of consensus about core objectives and guiding
principles, each platform will decide how they implement their version of the Artist-Centric model.
Some examples of how platforms are approaching this include: rewarding songs or artists that
reach a certain threshold of listeners or streams; rewarding streams that reflect more active fan
engagement; limiting the impact of non-artist noise content on platforms; protecting the royalty
pool from generative AI dilution; improving fraud detection and attribution; cleaning up zero-value
content already on platforms; and removing incentives for bad actors. Artists at every stage of their
career will benefit from these moves since they are prioritizing authentic artist-fan engagement.
What’s ahead: We continue to work with every digital service provider to embrace Phase 1 & 2 Artist-
Centric approaches that will support all artists regardless of the scale at which they are operating
and regardless of the stage of their careers. Adoption of these core principles will enhance artist
discovery and will also significantly benefit the streaming services themselves by returning them to
their core mission of bringing great music to fans. As part of that process, it promotes subscriber
acquisition and retention.
Embracing AI for good
History has taught us that the emergence of new technologies comes with both transformative
opportunities and inherent risks to traditional business models. Generative artificial intelligence is
no exception. In order to address and harness the rapid acceleration of developments in AI, UMG has
developed a strategy that carefully choreographs offense and defense while placing artists’ interests
at the center of the conversation.
Fighting infringing AI-generated content, unlicensed training on our catalog of copyright-protected
artist content and new fraud vectors in order to protect the rights and integrity of artists both now
and in the future is imperative. At the same time, AI can be used to enhance human creativity in
music, enriching aspects of what we do for our artists and their fans. For that reason, UMG has been
exploring the opportunities emerging from this technology for many years, applying AI for advances
in data analytics, marketing tools, enhanced studio and audio production, while working to protect
the long-term value of artistic content. Indeed, UMG holds a number of AI patents itself.
Why it matters: Placed in a context where artists' rights and interests are embraced and advanced,
AI will amplify human imagination and enrich musical creativity in extraordinary new ways. We see
great potential in AI to inspire and empower a new generation of talent.
An example of this approach is our collaboration with YouTube, the world’s leading video platform,
to launch their first AI-related music experiment - Dream Track for Shorts and Music AI tools –
built in collaboration with Google DeepMind. The experiment was designed to help explore how the
technology could be used to create deeper connections between artists and creators, and ultimately,
their fans. The experiment included UMG signed artists Demi Lovato, John Legend, and Troye Sivan,
among others, who all chose to collaborate in this experiment to help shape the potential creative
and commercial future for AI in music.
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This followed our shared set of principles and best practices between YouTube and UMG around the
use of AI in the creation of music that were announced in 2023 alongside a Music AI Incubator,
bringing together a working group of leading UMG artists, songwriters and producers across multiple
genres to help inform how generative AI technology could potentially be employed in a responsible
and ethical manner. Central to this collective vision is building a safe, responsible and profitable
ecosystem for music and video as technology advances — one where artists and songwriters can
maintain their creative integrity and be compensated fairly.
As our AI strategy has progressed, we have seen many more companies committed to exploring
responsible AI development, working with us on solutions that respect artists’ rights and
interests, unlock creativity, explore new commercial opportunities for us, and compensate
artists appropriately.
Of note: Earlier this year, UMG entered into a groundbreaking strategic partnership with SoundLabs,
an innovative new AI technology company, to create official ultra-high fidelity vocal models for
artists, using their own voice data for training while giving them full artistic approval and control of
the output. In October 2024, Brenda Lee’s iconic holiday hit, “Rockin’ Around The Christmas Tree",
first recorded 66 years ago, was released in Spanish for the first time, thanks to an innovative use of
responsibly-trained AI technology, derived from her voice and fully approved by Lee. The track’s new
vocal was created with the help of SoundLabs AI’s MicDrop, a cutting-edge AI audio plug-in which
allows a user to transform their voice into another voice or instrument.
In October 2024, we announced a strategic collaboration with KLAY Vision Inc. on a pioneering
commercial ethical foundational model for AI generated music that works in collaboration with the
music industry and its creators. KLAY aims to be the backbone for a new era of innovation, powering
new products and experiences, committed to the premise that AI can bolster and grow musical
creativity and human artistry. At the core of this shared vision is the conviction that state-of-the-art
foundational AI models are best built and scaled responsibly through constructive dialogue and
consensus with those responsible for the artistry.
In August 2024, UMG also announced a strategic collaboration with Idealab Studio, a leading
technology incubator behind ProRata.ai, a company founded to enable generative artificial
intelligence platforms to fractionally attribute and compensate content owners. ProRata’s technology
is designed to enable generative AI platforms – for the first time – to help accurately attribute
and share revenues on a per-use basis with content owners. The company’s attribution technology
will help protect and reward creators while preventing unreliable content from driving AI
query responses.
In March 2024, UMG and Roland Corporation – the electronic musical instruments maker – published
the Principles for Music Creation with AI, a series of clarifying statements relating to the responsible
use of AI in music creation and advocating for their adoption across the music industry and
creative community. The principles highlight the opportunity for innovation with AI in music
production, composition, and songwriting while underscoring the need for transparency, equity,
and community involvement. Today, more than 90 prominent music companies, associations, and
institutions globally added their support to the Principles, underscoring UMG’s influence as the
industry leader in this space. Among the organizations endorsing the principles are: SoundLabs,
National Association of Music Merchants (NAMM), Sydney University, BandLab Technologies, Splice,
Native Instruments, Focusrite, Output, Beatport, Waves, Soundful, LANDR, Eventide, GPU Audio, and
many more.
In November 2023, UMG released “Now And Then”, the last song from The Beatles – written and
sung by John Lennon, developed and worked on by Paul McCartney, George Harrison and Ringo Starr,
and now finally finished by Paul and Ringo over four decades later with help from pioneering AI
source separation technology. The track was nominated for both the prestigious “Record of the Year”
and won “Best Rock Performance” Grammy Award, the first time any track utilizing innovative AI
technology has been recognized for its creativity, among the major categories.
Guarding against AI’s risks: Rapid technological advancements have enabled digital manipulation,
misappropriation and misattribution of an artist’s name, image, likeness, voice and style – the
very characteristics that differentiate them as performers with unique vision and expression. Our
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challenge and opportunity as an industry is to establish effective tools, incentives and rewards—
as well as rules of the road — that enable us to limit AI’s potential downside while promoting its
promising upside.
Since early 2023, UMG has led the industry in articulating the importance of establishing the
perimeters of copyright, to ensure that artists’ creative output continues to be respected for
generations to come. UMG supports the Human Artistry Campaign (HAC) and its principles – the HAC
is a global initiative formed in early 2023 to protect creators’ rights in the age of AI, with more than
170 supporting organizations from 40+ countries.
In addition to responsible and ethical AI industry collaborations and thought leadership, UMG
is pursuing the establishment of legislative and regulatory “guardrails” for AI, including backing
legislation that would establish a federal right of publicity in the United States protecting all
Americans’ image, likeness and voice – and helping to prevent deepfakes. We are vigorously
advocating for public policies furthering responsible AI with governments around the globe,
including through multi-stakeholder coalitions and trade bodies, as well as on our own.
We are also protecting creators’ rights in the AI environment through litigation. For example, UMPG,
alongside two other music publishers, filed a copyright infringement lawsuit against Anthropic for
its large-scale, wholesale copying of copyrighted lyrics, and UMG is part of the RIAA’s action against
unlicensed generative AI platforms Suno and Udio.
The bottom line: AI will never replace human creativity because it will always lack the essential
spark that drives the most talented artists to do their best work. Forging a path on behalf of and
in collaboration with the entire music community will enable us to empower this breathtaking
technology responsibly to the benefit of the entire creative ecosystem.
Embracing entrepreneurs to accelerate the next wave of transformation
With a view to our industry’s future, UMG continues to advance our role as industry leader in
promoting entrepreneurship. We do this through a wide range of digital innovation programs,
including Abbey Road REDD. In addition, we drive innovation through a broadly deployed Accelerator
Engagement Network. Since 2017, UMG’s multifaceted Digital Innovation programs — which include
20 leading partners (accelerators, incubators, affiliates, etc.) based in entrepreneurial centers around
the world — have nurtured and mentored 300+ media and entertainment music start-ups, enabling
them to raise over $238+ million in funding.
UMG’s core music DNA — conveyed through incubation, connectivity, mentorship and the strategic
partner network that we can provide startups and entrepreneurs — is the greatest asset we can
provide early-stage companies. Some examples of companies backed by UMG and its accelerator
program include innovators like Audoo, Medimusic, MedRhythms, soundBrilliance and Xone
among others.
In 2024, UMG launched UMusicLift – an online hub dedicated to supporting startups with learning
resources, news, spotlights, and pathways to connect with UMG's Digital Innovation team. Our
company values are deeply embedded in supporting creators of all kinds, including those focused
on digital technology. We are the home for music’s greatest artists, innovators and entrepreneurs.
Since the inception of the Digital Innovation program in 2017, UMG has been at the forefront
of nurturing the music-tech ecosystem globally, developing partnerships with key networks,
embracing and mentoring startups, and creating programs and collaboration opportunities to
support these emerging businesses. By advancing entrepreneurial innovation, these initiatives also
drive significant value for UMG and, by extension, our artists. As technology continues to transform
the media landscape, UMG’s ongoing commitment to bolstering this vital ecosystem is central to our
mission, and we look forward to supporting the entrepreneurs of tomorrow.
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Innovation and R&D
Innovation is a key element of how we continue to lead at UMG. We are not only maximizing existing
commercial opportunities for our labels and artists, but also evolving our broad range of businesses
to identify future opportunities, fan behaviors and consumption trends.
Our unmatched commitment to lead -in collaborative development of new services, platforms and
business models for the delivery of music and related content- empowers innovators and promotes
new commercial and artistic opportunities.
We harness technological innovation to drive market growth. Through our expansive alliances and
groundbreaking partnerships across the industry, we enable our artists to better monetize their work
and build deeper engagement with their fans. We view innovation as central to our approach to bring
more music to more people around the world.
Advancing data and insights
A crucial aspect of our focus on innovation is the high priority we place on operationalizing data
and analytics at an industry-leading scale to promote the interests of our artists. We have made
ongoing strategic investments in data and analytics over the past several years, including building a
world-class analytics infrastructure based on cloud technology.
Our data and analytics team comprises analysts, data scientists, and front-end/ back-end coders
who develop algorithms to help UMG identify talent faster and more efficiently than our competitors.
We have developed innovative methods to identify tracks that are popular among distinct audience
clusters, and we can quickly detect viral moments, including those driven by social platforms.
We can then tailor our marketing initiatives to the target audience, which maximizes reach and
conversion. Our data scientists have developed a proprietary marketing mix model and a framework
for testing causal effects to help us both optimize our marketing mix and the creative content used
to activate on these channels.
Identifying and targeting superfans is just one key area in which UMG has utilized our advanced
capabilities in data and insights to help fuel discovery and further our ability to connect our artists
with their fans anywhere in the world.
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ORGANIZATIONAL AND REPORTING STRUCTURE
The following structure chart illustrates the simplified structure of UMG as at December 31st, 2024:
UNIVERSAL INTERNATIONAL MUSIC B.V.
The Netherlands
Corporate Executives
UMG is managed by corporate executives (the Corporate Executives).
The current Corporate Executives consists of nine key members, each of whom oversees a
specific aspect of the business. The persons set forth below are the current members of the
Corporate Executives.
Name Age Position
Sir Lucian Grainge 65 Chairman & Chief Executive Officer
Vincent Vallejo 64 Deputy Chief Executive Officer, Corporate
Philippe Flageul 60 Executive Vice President, Controller
Jody Gerson 64 Chairman & CEO for Universal Music Publishing Group
Jeffrey Harleston 64 General Counsel and Executive Vice President of Business & Legal Affairs
Eric Hutcherson 55 Executive Vice President, Chief People and Inclusion Officer
Boyd Muir 65 Executive Vice President, Chief Operating Officer and Chief
Financial Officer
Michael Nash 68 Executive Vice President, Chief Digital Officer
Will Tanous 54 Executive Vice President, Chief Administrative Officer
Set out below are brief summaries of the biographies of the members of the Corporate Executives:
Sir Lucian Grainge (Chairman and Chief Executive Officer)
Sir Lucian Grainge has spent his entire career in the music industry and has signed and worked
with many worldwide stars, including ABBA, Jay Z, Elton John, Katy Perry, Queen, Rihanna, The Rolling
Stones, Sam Smith, U2 and Amy Winehouse, among many others. During the span of four decades, he
not only pioneered new approaches to the signing and development of the world’s most successful
recording artists and songwriters, he also consistently championed the development of innovative
business models and partnerships with a wide range of technology and media partners around
the world. He has transformed Universal Music Group (UMG) into the most successful company in
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the history of the music industry, both competitively and financially, and his vision and leadership
is widely recognized as having returned the entire industry to growth after years of decline. In
2011, he led UMG’s successful acquisition of the recorded music assets of the legendary British
music company EMI, revitalizing its iconic Capitol Records, and, in the process, further strengthening
UMG’s position as the global leader in music. A native of London, Sir Lucian was bestowed with a
knighthood in 2016 by Her Majesty Queen Elizabeth II in the Queen’s 90th Birthday Honours list for
accomplishments in the music industry and leadership through its challenging times, contributions
to British business and inward investment, as well as his development of innovative business
models, technology and media partnerships that have expanded UMG’s global presence.
Vincent Vallejo (Deputy Chief Executive Officer, Corporate)
Based at the Company’s corporate headquarters in Hilversum, The Netherlands, Vincent Vallejo is
in the lead of a number of corporate initiatives related to the Company’s listing on the Euronext NV
in Amsterdam. Vallejo joined UMG in 2021 and has worked closely across UMG matters ever since
he joined Vivendi in 1998, where he served most recently as SVP, Audit & Special Projects. Prior to
joining Vivendi, Vallejo held positions at AGF-ALLIANZ in France (where he was Deputy CFO) and Ernst
& Young in Paris and Madrid. He received an MBA from Montpellier University and a Master of Science
from Cornell-Essec, CergyPontoise, France.
Philippe Flageul (Executive Vice President, Controller)
Philippe Flageul is Executive Vice President, Controller for Universal Music Group. He is responsible
for overseeing many aspects of UMG’s finance operations, including accounting, tax, treasury, risk
management and IT and supply chain finance. He also oversees UMG’s global procurement. Flageul
joined UMG in 2015 from Bolloré Group, where he worked for more than two decades as CFO of the
industrial division and Chairman of IER. Flageul holds an MBA from EDHEC.
Jody Gerson (Chairman & CEO for Universal Music Publishing Group)
Jody Gerson is Chairman and CEO of Universal Music Publishing Group [UMPG] and a member of
Universal Music Group’s [UMG’s] Executive Management Board. One of the industry’s most respected
and accomplished executives, Gerson leads a global company with 48 offices in 40 countries and
more than 850 employees. She made history as the first female chairman of a global music company
and the first woman to be named CEO of a major music publisher. Since joining UMPG in 2015,
Gerson has transformed the company into a global powerhouse that owns and administers more
than 5 million copyrights and the industry’s best global home for songwriters. A highly respected
creative authority and thought leader in our culture, Gerson has signed and works with the world’s
biggest superstars, including Adele, Bee Gees, Bad Bunny, Justin Bieber, Sabrina Carpenter, Lana Del
Rey, Ariana Grande, Coldplay, Drake, Billie Eilish, H.E.R., Elton John, Alicia Keys, Steve Lacy, Kendrick
Lamar, Post Malone, Maren Morris, the Prince estate, Rosalia, Harry Styles, Taylor Swift, SZA, The
Weeknd, and more. She also led UMPG’s historic and highly competitive acquisitions of the iconic
catalogs of Bob Dylan, Neil Diamond, Sting, and others. As a champion for women in music and
advocate for education, Gerson cofounded the global nonprofit She Is The Music. She also serves on
Boards for the USC Annenberg Inclusion Initiative, The Rock & Roll Hall of Fame, the National Music
Publishers Association, New Roads School, and Project Healthy Minds. In January 2020, Gerson made
history as the first woman and first music publishing executive to be named
Billboard
’s ‘Executive of
the Year’ for that outlet’s most coveted Power 100 list, and annually ranks within that list’s Top Ten.
She is the recipient of numerous other prestigious honors, including
Billboard
Power Players’ Choice
Award;
Variety
’s Hitmakers Executive of the Year;
Billboard
's 2015 Executive of the Year for their
Women In Music issue;
Rolling Stone
’s ‘Future 25’;
Variety
’s Power of Women L.A.; The 2016 March
of Dimes Inspiring Woman of the Year; and more. Gerson jointly oversees Polygram Entertainment,
a film and television development and production division of UMG which produces award-winning
feature-length films and music-centric series. In 2024 alone, she served as Executive Producer on a
broad array of projects, including
Music Box: Yacht Rock: A DOCKumentary
;
The Beach Boys
;
STAX:
Soulsville, U.S.A.
; and
Billy Preston: That’s The Way God Planned It
. Other recent projects that
Gerson Executive Produced include
The Bee Gees: How to Mend a Broken Heart
and HBO’s
Music
Box
series. Among her and Polygram’s many projects in development are documentaries on Bernie
Taupin and Prince.
Jeffrey Harleston (General Counsel and Executive Vice President, Business & Legal Affairs)
Jeffrey Harleston is responsible for the global oversight of all business transactions, contracts and
litigation. He is additionally responsible for the development of corporate policies, including the
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coordination of UMG’s government relations, trade and anti-piracy activities, to ensure a unified
strategy across the Company’s divisions. Harleston joined the Company in 1993 at MCA Records, after
serving as Associate Independent Counsel for the IranContra Investigation and prior to that as a
Litigation Associate at Covington & Burling LLP. Throughout his career, Harleston has been recognized
for his many achievements including receiving The Recording Academy’s 2020 Entertainment Law
Initiative Service Award, Billboard’s 2018 “Lawyer of the Year,” the 2018 Diversity Award from the
Association of Corporate Counsel for Southern California. In 2017, Harleston was named one of Ebony
magazine’s “Power 100” and he is annually recognized by Billboard on the magazine’s “Power 100”
list of the most powerful executives in the music industry. Harleston is a Member of the Board of
Trustees of Williams College and the Board of Harvard-Westlake School. He also serves on the boards
of the Recording Industry Association of America the TJ Martell Foundation, MusiCares and the
Motown Museum. Harleston is proud to be a Founder of the Universal/Motown Fund, an endowment
dedicated to providing financial assistance for artists from the 50’s, 60’s and 70’s. He received a B.A.
in Political Science from Williams College and a J.D. from the University of California, Berkeley School
of Law.
Eric Hutcherson (Executive Vice President, Chief People and Inclusion Officer)
With a focus on people, culture and inclusion, Eric Hutcherson leads a global team across UMG’s
record labels, publishing division and operating companies to align talent functions, amplify the
Company’s entrepreneurial-based culture, accelerate diversity and inclusion across all levels and
territories, attract, retain and develop talent, accelerate the Company’s social justice initiatives and
build on UMG’s successful track-record of driving innovation by recruiting employees who bring new
ideas, perspectives and skillsets. Prior to joining UMG, he was EVP, Chief Human Resources Officer
of the National Basketball Association (NBA) where he managed a team that drove the NBA’s global
workforce strategy. Hutcherson currently serves as Vice-Chair of Covenant House International and
Chair of the Human Capital Committee, and on the Board of Councilors for the USC Annenberg
School of Communication and Journalism. Additionally, he serves as strategic advisor to the Board
of Directors for the Young Peoples Chorus; a multicultural youth chorus whose mission is to provide
children of all economic and cultural backgrounds with a unique program of music education and
choral performance. Hutcherson earned a bachelor’s degree in political science from New York
University and a master’s degree in Sports Management and Administration from the University
of Massachusetts-Amherst.
Boyd Muir (Executive Vice President, Chief Operating Officer and Chief Financial Officer)
Boyd Muir is Chief Operating Officer (COO), and Chief Financial Officer (CFO) of Universal Music Group
(UMG). As COO, Muir is responsible for driving strategic growth across the company’s worldwide
operations and has played a central role in the physical-to-digital reshaping of company resources,
in addition to leading its global financial operations, asset management, information technology,
accounting and supply chain. Muir, who was appointed COO in October 2024, will continue to serve
as CFO until his successor is appointed. As UMG’s CFO, Muir played a key role in the company’s
successful listing on the Euronext stock exchange in 2021. He has also been involved in a number
of significant acquisitions, including Sanctuary Group and V2 Music Group, as well as leading the
company’s successful acquisitions of EMI, Ingrooves, [PIAS] and UMG’s minority investment in the
Chord Music Fund. He was appointed as UMG’s EVP, CFO and President of Operations in 2010, having
previously served as CFO for Universal Music Group International, the division which manages UMG’s
businesses in more than 50 countries for more than a decade. From 1984 to 1991, Muir worked
for Ernst & Young, including at its entertainment media division in London, and for EMI from 1991
to 1994. At the latter group, he was head of internal audit, spending considerable time working in
Los Angeles and New York. He was also closely involved in EMI’s acquisition of Virgin Music and
Chrysalis Records.
Michael Nash (Executive Vice President, Chief Digital Officer)
Michael Nash is Executive Vice President, Chief Digital Officer and oversees UMG’s digital business
development activities around the world. Nash has worked at the forefront of media and technology
convergence for his entire career as an executive, entrepreneur and producer. Most recently, Nash
served as a strategic advisor to Warner Music Group (WMG), as well as several digital media startups
and new technology companies. Prior to that, he served as an executive at WMG from 2000 to 2011,
rising to the role of Executive Vice President of Digital Strategy and Business Development where
he oversaw WMG’s worldwide new media projects, strategic relationships and business development
activities. Before joining WMG, Nash was the Executive Director of the Madison Project, the music
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
industry’s first digital distribution trial. From 1994 to 1997, Nash was founding CEO of Inscape, an
interactive entertainment and games publishing joint venture between WMG and HBO that produced
titles with artists such as William S. Burroughs, DEVO, Thomas Dolby and The Residents. Prior to that,
Nash served as Director of The Criterion Collection, working closely with directors and artists such as
Robert Altman, David Bowie, Terry Gilliam and Louis Malle.
Will Tanous (Executive Vice President, Chief Administrative Officer)
Will Tanous plays a key role in the development of the company’s business strategy, overseeing
several major strategic and corporate endeavors, as well as managing worldwide external and
internal communications, global public policy, investor and government relations, event functions
and global impact. Prior to joining UMG in 2013, Tanous served as Executive Vice President of
Communications & Marketing for Warner Music Group where he was central in all of the company’s
major corporate initiatives, including: the sale of WMG to Access Industries, Inc.; WMG’s initial public
offering on the New York Stock Exchange in 2005; and the sale of WMG by Time Warner Inc. to a
private equity consortium. In 2019, he was awarded the prestigious Ellis Island Medal of Honor,
which is presented annually to U.S. citizens “who have distinguished themselves within their own
ethnic groups while exemplifying the values of the American way of life.” He serves on the board
of the Recording Industry Association of America and is a graduate of Georgetown University in
Washington D.C.
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
FINANCIAL REVIEW
EARNINGS ANALYSIS: GROUP AND BUSINESS SEGMENTS
Consolidated Statement of Profit or Loss
Year ended December 31,
(millions of euros)
2024 2023
Revenues
11,834 11,108
Cost of revenues (6,746) (6,208)
Selling, general and administrative expenses (3,015) (3,213)
Amortisation and impairment losses on intangible assets (298) (269)
Operating profit
1,775 1,418
Financial income 1,279 454
Financial expenses (187) (151)
1,092 303
Income/(loss) from equity affiliates 4 -
Profit before income taxes
2,871 1,721
Income taxes (778) (458)
Net profit
2,093 1,263
Of which:
Net profit attributable to equity holders of the parent 2,086 1,259
Net profit attributable to non-controlling interests 7 4
Earnings per share (in euros)
Earnings for the period attributable to equity holders of the parent - basic 1.14 0.69
Earnings for the period attributable to equity holders of the parent - diluted 1.13 0.68
Adjusted net profit
1,2
1,782 1,626
Adjusted net profit per share (in euros) - basic
1
0.98 0.89
Adjusted net profit per share (in euros) - diluted
1
0.96 0.88
1 Non-IFRS measures as defined in the Appendix to the Annual Report
2 Following a change in the definition, the FY23 Adjusted Net Profit has been restated to exclude the impacts of
restructuring expenses and related tax impacts.
Reconciliation of Operating Profit to EBITDA and Adjusted EBITDA
Year ended December 31,
(millions of euros)
2024 2023
Operating Profit
1,775
1,418
Adjustments
Amortization and depreciation expense 409 382
Restructuring expenses 169 41
(Gain)/loss on sale of assets (23) (26)
Impairment (reversal)/charge on intangible assets 2 (7)
EBITDA
1
2,332 1,808
Non-cash share-based compensation expense 329 561
Adjusted EBITDA
1
2,661 2,369
1 As defined in the Appendix to the annual report
Analysis of the Consolidated Statement of Profit or Loss
Revenues
In 2024, UMG’s revenues of €11,834 million were up 6.5% compared to 2023 and up 7.6% at constant
currency. This increase was driven by improvements across all divisions. Recorded Music grew 5.2%
year-over-year and 6.4% at constant currency compared to 2023, Music Publishing was up 8.4%
or 9.0% in constant currency and Merchandising and Other grew by 19.3% year-over-year and in
constant currency.
For a detailed analysis of revenues by business segment, please refer to the Analysis of revenues
and operating results by business segment section below and to Note 3 to the Consolidated Financial
Statements for the year ended December 31, 2024.
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Operating results
Analysis of cost of revenues:
Year ended December 31,
(millions of euros)
2024 2023
Artist costs 5,464 5,152
Product costs 1,282 1,056
Cost of Revenues
6,746 6,208
Cost of Revenues grew by €538 million to €6,746 million in 2024 from €6,208 million in 2023, reflecting
the increase in revenues. Cost of revenues as a percentage of revenues increased to 57.0% from
55.9% driven by higher relative product costs and despite lower relative artist costs.
Product costs increased by €226 million to €1,282 million in 2023 from €1,056 million in 2023
reflecting the growth in revenues. Product costs as a percentage of revenues increased to 10.8%
from 9.5% due primarily to revenue mix including the greater proportion of merchandising sales.
Artist costs increased by €312 million to €5,464 million in 2024 from €5,152 million in 2023 driven by
the increase in sales. As a percentage of revenues, artists costs decreased slightly to 46.2% in 2024
from 46.4% in 2023 due to repertoire mix.
Selling, general and administrative expenses decreased by €198 million to €3,015 million in 2024
from €3,213 million in 2023 and decreased as a percentage of revenues to 25.5% in 2024 from 28.9%
in 2023 due largely to lower non-cash share-based compensation expenses. Non-cash share-based
compensation expenses decreased to €329 million in 2024 from €561 million in 2023, down by
€232m. This was partially offset by the increase in restructuring charges that were €169 million
in 2024 compared to €41 million in 2023 as a result of the previously announced strategic
organizational redesign.
Operating profit
was €1,775 million in 2024, compared to €1,418 million for 2023, an increase of
€357 million, 25.2% or 28.0% at constant currency, driven by the higher revenues and lower non-cash
share based compensation expenses (discussed above) partly offset by the increase in restructuring
charges. As a percentage of revenues, operating profit increased to 15.0% in 2024 from 12.8% in 2023.
EBITDA increased by €524 million, 29.0% or 31.3% at constant currency to €2,332 million in 2024
compared to €1,808 million in 2023 driven by the increase in revenues and lower non-cash share
based compensation expenses (discussed above). EBITDA margin increased by 3.4pp to 19.7% in
2024 compared to 16.3% in 2023 also due to operating leverage and cost savings from the strategic
organizational redesign, partially offset by the higher product costs discussed above.
Adjusted EBITDA was €2,661 million in 2024 up €292 million, 12.3% or 13.8% at constant currency
compared to €2,369 million in 2023. Adjusted EBITDA margin increased by 1.2pp to 22.5% in 2024 from
21.3% in 2023.
For a detailed analysis of EBITDA and Adjusted EBITDA by business segment, please refer to the
Analysis of revenues and operating results by business segment section below.
Financial results
Financial income and Financial expenses were a net income of €1,092 million in 2024, compared
to a net income of €303 million for 2023, an improvement of €789 million. For 2024, the revaluation
of the investments in listed companies including Spotify and Tencent Music Entertainment was
a net income amount of €1,163 million, compared to a net income of €425 million for 2023, an
improvement of €738 million.
Income taxes
For 2024, income taxes were a net expense of €778 million, compared to a net expense of
€458 million for 2023. This increase notably reflected the increase in the deferred tax charge relating
to the revaluation of the investments in listed companies including Spotify and Tencent Music
Entertainment (-€301 million expense in 2024, compared to -€111 million expense in 2023).
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Non-controlling interests
For 2024, earnings attributable to non-controlling interests were €7 million, slightly higher than the
€4 million for 2023.
Net profit attributable to equity holders of the parent
For 2024, net profit attributable to equity holders of the parent amounted to a profit of €2,086 million
(or €1.14 per share - basic), compared to €1,259 million for 2023 (or €0.69 per share - basic),
an increase of €827 million. Net profit attributable to equity holders of the parent increased by
€827 million, reflecting:
■
the variance in financial results (+€789 million) driven by the revaluation of the investments in
Spotify, Tencent Music Entertainment and other listed investments (+€738 million); and
■
the increase in operating profit (+€357 million);
partially offset by:
■
the increase in income taxes reported to net income (-€320 million), on higher taxable income
including the increase in the deferred tax charge relating to the revaluation of the investments in
Spotify, Tencent Music Entertainment and other listed investments.
Adjusted net profit
Adjusted net profit in 2024 amounted to a profit of €1,782 million (or €0.98 per share - basic),
compared to €1,626 million for 2023 (or €0.89 per share - basic), an increase of €156 million. Adjusted
net profit increased by €156 million, including:
■
the growth in Adjusted EBITDA (+€292 million);
partially offset by:
■
the increase in income taxes reported to Adjusted net profit (-€105 million).
Analysis of revenues and operating results by business segment
Year ended December 31,
(millions of euros)
2024 2023 % Change
% Change at
constant
currency
Revenues
Recorded Music 8,901 8,461 5.2% 6.4%
Music Publishing 2,121 1,956 8.4% 9.0%
Merchandising & Other 842 706 19.3% 19.3%
Corporate Centre - - 0.0% 0.0%
Elimination of inter-segment transactions (30) (15)
Total UMG
11,834 11,108 6.5% 7.6%
EBITDA
1
Recorded Music 2,073 1,618 28.1% 30.5%
Music Publishing 486 420 15.7% 16.3%
Merchandising & Other 42 43 (2.3%) (2.3%)
Corporate Centre (269) (273) 1.5% 1.8%
Total UMG
2,332 1,808 29.0% 31.3%
1 As defined in the Appendix to the Annual Report
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Recorded Music
Year ended December 31,
(millions of euros)
2024 2023 % Change
% Change at
constant
currency
Subscriptions and streaming revenue 6,038 5,700 5.9% 6.8%
of which streaming 1,414 1,425
(0.8%) 0.1%
of which subscription 4,624 4,275 8.2% 9.1%
Downloads and other digital revenue 180 207 (13.0%) (11.8%)
Physical revenue 1,358 1,380 (1.6%) 1.1%
License and other revenue 1,325 1,174 12.9% 13.5%
Recorded Music Revenues
8,901 8,461 5.2% 6.4%
EBITDA
1
2,073 1,618
28.1% 30.5%
EBITDA margin
1
23.3% 19.1% 4.2pp
Adjusted EBITDA
1
2,275 2,042
11.4% 12.9%
Adjusted EBITDA margin
1
25.6% 24.1% 1.5pp
1 As defined in the Appendix to the Annual Report
In 2024, Recorded Music revenues were €8,901 million, up 5.2% compared to 2023, and up 6.4%
in constant currency. Subscription revenues grew by 8.2% or 9.1% in constant currency driven
by the growth in global subscribers as well as the impact of price increases at certain platforms.
Streaming revenue declined 0.8%, but grew by 0.1% in constant currency as the consumption grows
but continues to shift from better monetized video platforms to short-form platforms, which are not
yet as well monetized. Physical revenue decreased by 1.6%, but grew 1.1% in constant currency.
Downloads and other digital revenue declined by 13.0%, and 11.8% in constant currency, due to
the continued decline in download sales. License and other revenue improved 12.9% or 13.5% in
constant currency, as a result of improved live, brand sponsorship, neighbouring rights and
synchronization income, as well as €32 million from certain legal settlements reported in Q4 2024,
whilst the prior year included the timing related benefit of a new licensing deal. Top sellers for the
year included multiple albums from Taylor Swift, and albums from Billie Eilish, Sabrina Carpenter,
Morgan Wallen and Chappell Roan. Top sellers in the prior year included multiple albums from Taylor
Swift, and albums from Morgan Wallen, King & Prince, Karol G, and The Weeknd.
Recorded Music EBITDA in 2024 of €2,073 million was up €455 million from €1,618 million in 2023 due
to the growth in revenues and the decrease in non-cash share based compensation. In 2024, EBITDA
included €202 million of non-cash share based compensation compared to €424 million of non-cash
share-based compensation expense in 2023.
Adjusted EBITDA for Recorded Music increased by €233 million to €2,275 million in 2024 from
€2,042 million in 2023. Adjusted EBITDA margin increased by 1.5pp to 25.6% of revenues from
24.1% of revenues in 2023 due also to operating leverage and cost savings from the strategic
organizational redesign.
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Music Publishing
Year ended December 31,
(millions of euros)
2024 2023 % Change
% Change at
constant
currency
Performance revenue 442 416 6.3% 7.3%
Synchronisation revenue 253 254 (0.4%) 0.4%
Digital revenue 1,268 1,128 12.4% 12.9%
Mechanical revenue 103 108 (4.6%) (4.6%)
Other revenue 55 50 10.0% 10.0%
Music Publishing Revenues
2,121 1,956 8.4% 9.0%
EBITDA
1
486 420
15.7% 16.3%
EBITDA margin
1
22.9% 21.5% 1.4pp
Adjusted EBITDA
1
511 470
8.7% 9.2%
Adjusted EBITDA margin
1
24.1% 24.0% 0.1pp
1 As defined in the Appendix to the Annual Report
Music Publishing revenue amounted to €2,121 million in 2024, up 8.4% year-over-year and 9.0% in
constant currency. Revenues benefited from the continued growth in subscription and streaming
and an improvement in performance income. Revenues in 2024 also benefited from €8 million from
certain legal settlements reported in Q4 2024, whereas 2023 benefited from the €53 million accrual
for a catch-up payment from certain digital service providers related to the Copyright Royalty Board
Phonorecords III ruling.
Music Publishing EBITDA in 2024 of €486 million was up €66 million from €420 million in 2023 driven
by the growth in revenues and lower non-cash share based compensation. EBITDA was impacted by
€25 million of non-cash share based compensation expense in 2024 (€50 million in 2023).
Music Publishing Adjusted EBITDA increased by €41 million to €511 million in 2024 compared to
€470 million in 2023 as a result of the revenue growth. Adjusted EBITDA margin increased by 0.1pp to
24.1% from 24.0% of revenues in 2023.
Merchandising & Other
Year ended December 31,
(millions of euros)
2024 2023 % Change
% Change at
constant
currency
Merchandising and Other Revenues
842 706 19.3% 19.3%
EBITDA
1
42 43 (2.3%) (2.3%)
EBITDA margin
1
5.0% 6.1% (1.1pp)
Adjusted EBITDA
1
43 47 (8.5%) (6.5%)
Adjusted EBITDA margin
1
5.1% 6.7% (1.6pp)
1 As defined in the Appendix to the Annual Report
Merchandising and Other revenue grew to €842 million, up 19.3%, both year-on-year and in constant
currency driven by the strong growth in direct-to consumer sales and touring merchandise sales.
Merchandising and Other EBITDA in 2024 of €42 million was down €1 million from €43 million in
2023. EBITDA was impacted by €1 million of share based compensation expense in 2024 (€4 million
in 2023).
Merchandising and Other Adjusted EBITDA decreased by €4 million to €43 million in 2024 compared
to €47 million in 2023. Adjusted EBITDA margins decreased by 1.6pp to 5.1% of revenues from 6.7%
of revenues in 2023 driven by higher manufacturing and distribution costs related to product mix as
well as the growth in lower-margin touring merchandise sales.
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Corporate
Year ended December 31,
(millions of euros)
2024 2023 % Change
% Change at
constant
currency
EBITDA
1
(269) (273) (1.5%) (1.8%)
EBITDA margin
1
- -
Adjusted EBITDA
1
(168) (190) (11.6%) (12.0%)
Adjusted EBITDA margin
1
- -
1 As defined in the Appendix to the Annual Report
Corporate EBITDA was a net expense of €269 million, compared to a net expense of €273 million
for 2023, a €4 million decrease in expense. EBITDA in 2024 included €101 million of non-cash share-
based compensation related expenses (€83 million in 2023).
Corporate Adjusted EBITDA was a net expense of €168 million in 2024, a €22 million decrease in
expense from the Adjusted EBITDA expense in 2023 of €190 million.
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LIQUIDITY AND CAPITAL RESOURCES
Financial Net Debt
Year ended December 31,
(millions of euros)
2024 2023
Cash and cash equivalents
553 413
Derivative financial assets
- 2
Drawn revolving credit facilities - -
Bank overdrafts (8) (26)
Bonds (1,810) (1,808)
Commercial papers (746) (197)
Other (87) (73)
Borrowings at amortized cost
(2,651) (2,104)
Financial Net Debt
1
(2,098) (1,689)
1 As defined in the Appendix to the Annual Report
Changes in the Financial Net Debt
As of December 31, 2024, UMG’s Financial Net Debt amounted to -€2,098 million compared to
Financial Net Debt of -€1,689 million as of December 31, 2023, i.e., an increase in net debt of
€409 million. This change was mainly attributable to the following:
■
Net cash provided by operating activities of €1,755 million;
offset by:
■
in June and July 2024, UMG paid the final dividend with respect to fiscal year 2023 of €494 million;
■
in October and November 2024, UMG paid an interim dividend with respect to fiscal year 2024 of
€439 million;
■
Net cash used for investing activities of -€1,051 million primarily due to the €619 million net
purchase of consolidated companies, equity affiliates and financial assets relating to several
strategic investments in the year including investments in Chord Music Partners, NTWRK, Mavin
Global and [PIAS]. Net cash used for investing activities also included the €266 million investment
in Music Publishing and Recorded Music catalogues and €183 million investment in other
intangibles and capital expenditure; and
■
repayment of €102 million in relation to lease liabilities and related interest and €79 million in
other interest and financing related payments.
UMG believes that the cash flow generated by its operating activities, its cash surpluses, net of
amounts used to reduce UMG’s debt, as well as funds available through undrawn bank credit
facilities and additional funding opportunities will be sufficient to cover expenses and investments
necessary for its operations, its debt service, the payment of income taxes, the distribution of
dividends, as well as its investment projects, if any, for the next 12 months.
Equity portfolio
As of December 31, 2024, UMG held a portfolio of listed non-controlling equity interests (including
Spotify) with an aggregate market value of approximately €2,945 million (before taxes), compared to
€1,227 million as of December 31, 2023. The increase in market value during 2024 was due to the
fluctuation in share price of our listed investments most notably of Spotify. As at February 28, the
aggregate market value of these listed investments had increased to approximately €3,934 million
(before taxes).
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Cash flow analysis
Year ended December 31,
(millions of euros)
2024 2023
Operating activities
Operating profit 1,775 1,418
Adjustments 520 796
Royalty advances payments, net of recoupments (186) (100)
Gross cash provided by/(used for) operating activities before income tax paid
2,109 2,114
Other changes in net working capital (5) 164
Net cash provided by/(used for) operating activities before income tax paid
2,104 2,278
Income tax paid (349) (393)
Net cash provided by/(used for) operating activities
1,755 1,885
Investing activities
Catalogue investments (266) (178)
Other intangible assets investments (92) (74)
Capital expenditures (91) (47)
Purchases of consolidated companies, after acquired cash (163) (97)
Investments in equity affiliates (390) (81)
Purchase of financial assets (145) (154)
Investments
(1,147) (631)
Proceeds from sales of property, plant, equipment and intangible assets 2
-
Proceeds from sales of consolidated companies, after divested cash - 1
Proceeds from sale of financial assets 79 1
Divestitures
81 2
Dividends received from equity affiliates 12 4
Dividends received from investments 3 3
Net cash provided by/(used for) investing activities
(1,051) (622)
Year ended December 31,
(millions of euros)
2024 2023
Financing activities
Distributions to shareowners (933) (929)
Dividends paid by consolidated companies to their non-controlling interests (4) (2)
Transactions with shareowners
(937) (931)
Proceeds from borrowings 4,321 6,647
Repayments of borrowings (3,755) (6,815)
Interest, net (81) (77)
Other cash items related to financing activities 2 (10)
Transactions on borrowings and other financial liabilities
487 (255)
Repayment of lease liabilities (81) (80)
Payment of interest of lease liabilities (21) (14)
Net cash provided by/(used for) financing activities
(552) (1,280)
Net change in cash and cash equivalents
152 (17)
Foreign currency translation adjustments 6 (34)
Change in cash and cash equivalents
158 (51)
Cash and cash equivalents
At beginning of the period 387 438
At end of the period 545 387
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Reconciliation of cash provided by operating activities to Free Cash Flow
Year ended
December 31,
(millions of euros)
2024 2023
Net cash provided by/(used for) operating activities 1,755 1,885
Net cash provided by/(used for) investing activities (1,051) (622)
Repayment of lease liabilities and related interest expenses (102) (94)
Interest, net (81) (77)
Other cash items related to financing activities 2 (10)
Free Cash Flow
1
523 1,082
1 As defined in the Appendix to the Annual Report
Net cash provided by operating activities before income tax
For 2024, Net cash provided by operating activities before income tax amounted to an inflow of
€2,104 million compared to an inflow of €2,278 million for 2023, a decline of €174 million. This
decrease was mainly attributable to the following items:
■
the increase in Operating profit (+€357 million);
partially offset by:
■
the decrease in Adjustments (-€276 million) including the lower non-cash share based
compensation expense reflected in Operating profit and offset within Adjustments, and higher
cash paid to settle employee tax withheld (see breakdown of Adjustments in the Appendix);
■
the increase in Royalty advances payments net of recoupments (-€86 million) due to the timing of
major artist renewals and extensions partly offset by higher recoupments; and
■
the unfavourable variance in Other changes in net working capital (-€169 million) including higher
royalty payments.
Net cash provided by operating activities
Net cash provided by operating activities in 2024 amounted to an inflow of €1,755 million compared
to an inflow €1,885 million for 2023, a decrease of €130 million. Net cash provided by operating
activities before income tax in 2024 was €174 million lower than in 2023 but income tax paid in 2024
was €44 million lower than in 2023.
Net cash used for investing activities
Net cash used for investing activities in 2024 was a €1,051 million net outflow compared to a
€622 million net outflow for 2023, an increased outflow of €429 million. The net purchase of
consolidated companies, equity affiliates and financial assets was €289 million higher than in
2023 and represented various strategic investments entered into during the year including the
investments in Chord Music Partners, NTWRK, Mavin Global and [PIAS]. Divestitures of financial assets
of €79 million in 2024 included the release of funds, previously paid into escrow, to complete a
catalogue acquisition during the period. Catalogue investments in 2024 were higher than in 2023
(-€88 million) due to the timing of deals and investment in other intangible assets and capital
expenditure was also higher (-€62 million).
Net cash used for financing activities
Net cash used for financing activities in 2024 was a €552 million net outflow compared to a
€1,280 million net outflow for 2023, a decreased outflow of €728 million. This was mainly attributable
to a net proceed of borrowing in 2024 of €566 million compared to a net repayment of borrowing of
€(168) million in 2023 (+€734 million). Dividend and interest payments in 2024 were broadly in line
with payments in 2023.
Free Cash Flow
Free Cash Flow in 2024 was a €523 million net inflow compared to a €1,082 million net inflow for 2023,
a decrease of €559 million. This is the result of net cash provided by operating activities declining by
€130 million compared to 2023 as well as greater net cash used for investing activities (-€429 million)
due to greater strategic investments in the year.
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CORPORATE GOVERNANCE
THE GOVERNANCE STRUCTURE
Universal Music Group N.V. (UMG or the Company) is a public limited liability company (
naamloze
vennootschap
) incorporated under the laws of the Netherlands. The Shares (as defined in the
Shareholder Information section under "Share capital") were first admitted to listing and trading on
Euronext Amsterdam (the Listing), the regulated market of Euronext Amsterdam N.V., on September
21, 2021. The Company has a one-tier board (the Board), which currently comprises of two executive
directors (the Executive Directors) and eleven non-executive directors (the Non-Executive Directors
and, together with the Executive Directors, the Directors). The Executive Directors are primarily
responsible for all day-to-day operations of the Company. The Non-Executive Directors supervise the
Executive Directors’ policy and performance of duties and the Company’s general course of affairs
and business, and render advice and direction to the Executive Directors. The Directors furthermore
perform any duties allocated to them under or pursuant to the law or the Company’s articles of
association (the Articles). Each Director has a duty to the Company to properly perform the duties
allocated to him or her and to act in the Company’s corporate interests. Under Dutch law, the
Company’s corporate interests extend to the interests of all of the Company’s stakeholders, including
the Company’s shareholders (the Shareholders), creditors, customers and employees.
The Company acknowledges the importance of good corporate governance and complies with most
of the principles and best practice provisions of the Dutch Corporate Governance Code of December
20, 2022 (the
Code), the full text of which can be found on www.mccg.nl. Deviations from any of the
principles and best practice provisions of the Code are explained under "Compliance with the Code--
Deviations" in accordance with the Code’s ‘comply or explain’ principle. Substantial changes in the
Company’s corporate governance structure and in the Company’s compliance with the Code, if any,
will be dealt with at the annual General Meeting (as defined under "The Board") as a separate item.
The Annual Report also includes the information that the Company is required to disclose pursuant
to the Dutch Decree on Article 10 of the Takeover Directive (
Besluit artikel 10 overnamerichtlijn
) and
the Dutch Decree on the Content of the Board Report (
Besluit inhoud bestuursverslag
).
THE BOARD
The Board is the executive and supervisory body of the Company. It is entrusted with the
management of the Company, it supervises the Company's general course of affairs and business
and is responsible for the continuity of the Company. The Board is accountable for these matters to
the Company’s general meeting of shareholders (the General Meeting, being the corporate body or,
where the context so requires, the physical meeting).
The Board’s responsibilities include, among others, developing a view on sustainable long-term
value creation by the Company and formulating a strategy as well as specific objectives in line with
this view, identifying and managing the risks associated with the Company’s strategy and activities,
appointing and dismissing the senior internal auditor, annually assessing the way in which the
internal audit function fulfills its responsibility and ensuring that such assessment is performed
by an independent third party at least every five years, approving the internal audit plan, giving
account of the effectiveness of the design and operation of the internal risk management and
control systems, ensuring compliance with all applicable laws and regulations and the Company’s
corporate governance structure and preparing, approving and signing the (semi-annual) financial
statements and Board report and approving the annual budget and major capital expenditures in
excess thereof.
The Board may perform all acts necessary or useful for achieving the Company’s objectives, with
the exception of those acts that are prohibited pursuant to the law or the Articles. Pursuant to the
Articles, the Board may allocate its duties and powers among the Directors pursuant to the Board
Regulations (as defined under "The Board––Board Regulations") or otherwise in writing, provided that
the following duties and powers may not be allocated to the Executive Directors: (i) supervising the
performance of the Executive Directors, (ii) making a nomination for the appointment of Directors,
(iii) determining an Executive Director’s remuneration and (iv) instructing the external auditor(s) to
audit the financial statements. Regardless of an allocation of duties and powers, all Directors remain
collectively responsible for the proper management and strategy of the Company (including the
supervision thereof in the case of the Non-Executive Directors).
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Board Regulations
The Board has drawn up regulations dealing with its internal organization and setting out, among
others, the role and responsibilities of the Board, its composition and size and the manner in which
its meetings should be held (the Board Regulations). The Board Regulations are available on the
investor relations part of the UMG website.
Composition
The Articles provide that the Board shall consist of one or more Executive Directors and one or
more Non-Executive Directors. The number of Executive Directors and the number of Non-Executive
Directors shall be determined by the Board. The Board currently comprises of two Executive Directors
and eleven Non-Executive Directors, two of whom, being Eric Sprunk and Mandy Ginsberg, were
appointed to the Board by the General Meeting on May 16, 2024:
Name Function
Sir Lucian Grainge Executive Director, Chairman and Chief Executive Officer
Vincent Vallejo Executive Director, Deputy Chief Executive Officer, Corporate
Sherry Lansing Non-Executive Director, Chairman of the Board
Margaret Frerejean-Taittinger Non-Executive Director, Vice-Chairman of the Board
Bill Ackman Non-Executive Director
Cathia Lawson-Hall Non-Executive Director
Cyrille Bolloré Non-Executive Director
Eric Sprunk Non-Executive Director
Haim Saban Non-Executive Director
James Mitchell Non-Executive Director
Luc van Os Non-Executive Director
Mandy Ginsberg Non-Executive Director
Nicole Avant Non-Executive Director
Antoine Fiévet acted as Non-Executive Director and chair of the Remuneration Committee until the
close of the annual General Meeting held on May 16, 2024, on which date his term ended. He decided
not to stand for reappointment.
Manning Doherty acted as Non-Executive Director but recently resigned from the Board, effective
March 21, 2025.
None of the Non-Executive Directors represents the Company's employees and other workers.
Appointment and appointment term
The Executive Directors and Non-Executive Directors shall be appointed as such by the General
Meeting at the non-binding nomination of the Board. A nomination by the Board shall state whether
a person is nominated for appointment as Executive Director or Non-Executive Director. The person
so nominated shall be appointed by a resolution adopted by the General Meeting with a simple
majority of the votes cast. A Director shall be appointed for a maximum period of two years, provided,
however, that his or her term of office shall lapse immediately after the close of the annual General
Meeting held in the second year after his or her appointment. A Director may be reappointed
with observance of the preceding sentences. At the proposal of the Board, the General Meeting
may resolve to deviate from the maximum period of two years. The Articles provide that each Non-
Executive Director may be in office for a maximum period of twelve years, unless at the proposal
of the Board the General Meeting resolves otherwise. A Non-Executive Director’s term of office shall
lapse in accordance with a retirement schedule drawn up by the Board to avoid, as much as possible,
reappointments and retirements of Non-Executive Directors occurring all at the same time so as
to ensure continued experience on the Board. Currently, the terms of office of three (out of eleven)
Non-Executive Directors lapse at the close of the annual General Meeting to be held in 2025, and it is
the intention that the use of the retirement schedule will result in a more staggered replacement of
the Non-Executive Directors over time.
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The appointment dates of the Non-Executive Directors and the end of their current terms are
as follows:
Name Initial appointment date Reappointment date Term End of current term
Sherry Lansing May 12, 2022 May 11, 2023 Second term Until the close of the annual General Meeting to be held in 2025
Margaret Frerejean-Taittinger September 20, 2021 May 16, 2024 Second term Until the close of the annual General Meeting to be held in 2026
Bill Ackman May 12, 2022 May 16, 2024 Second term Until the close of the annual General Meeting to be held in 2026
Cathia Lawson-Hall September 20, 2021 May 16, 2024 Second term Until the close of the annual General Meeting to be held in 2026
Cyrille Bolloré May 12, 2022 May 16, 2024 Second term Until the close of the annual General Meeting to be held in 2026
Haim Saban May 11, 2023 - First term Until the close of the annual General Meeting to be held in 2025
Eric Sprunk May 16, 2024 - First term Until the close of the annual General Meeting to be held in 2026
James Mitchell September 20, 2021 May 16, 2024 Second term Until the close of the annual General Meeting to be held in 2026
Luc van Os September 20, 2021 May 11, 2023 Second term Until the close of the annual General Meeting to be held in 2025
Mandy Ginsberg May 16, 2024 - First term Until the close of the annual General Meeting to be held in 2026
Nicole Avant May 12, 2022 May 16, 2024 Second term Until the close of the annual General Meeting to be held in 2026
Suspension and dismissal
The General Meeting may at all times suspend or dismiss any Director. The Board may at all times
suspend an Executive Director. A suspension may be extended one or more times but may not last
longer than three months in aggregate. If at the end of that period, no decision has been taken on the
termination of the suspension or on a dismissal, the suspension shall terminate. A suspension can
be terminated by the General Meeting at any time.
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Independence
As per best practice provision 2.1.8 of the Code, a Non-Executive Director shall not be considered
independent if such Non-Executive Director or his or her spouse, registered partner or life
companion, (foster) child or relative by blood or marriage up to the second degree:
■
has been an employee of the Company or Executive Director or an employee or member of the
management (or executive) board of an associated issuing institution in the five years prior to his
or her appointment;
■
receives personal financial compensation from the Company or an associated company, other
than the compensation received for the work performed as a Non-Executive Director and in so far
as this is not in the normal course of business;
■
has had an important business relationship with the Company or an associated company in the
year prior to the appointment;
■
is a member of the management (or executive) board of a company in which an Executive Director
is a member of the supervisory (or non-executive) board;
■
has temporarily performed management (or executive) duties during the previous twelve months
in the absence or incapacity of Executive Directors;
■
has a shareholding of at least 10% in the issued share capital of the Company, taking into account
the shareholding of natural persons or legal entities cooperating with him or her on the basis of
an express or tacit verbal or written agreement; or
■
is a member of the management (or executive) board or supervisory (or non-executive) board – or
is a representative in some other way – of a legal entity which holds at least 10% of the issued
share capital of the Company, unless the legal entity is a subsidiary.
The independency of Non-Executive Directors is in any case assessed prior to each nomination for
(re)appointment to the Board.
Limitations on supervisory or non-executive positions
The number of an Executive Director’s supervisory (or non-executive) positions of large Dutch
companies or foundations shall be limited to a maximum of two. An Executive Director may not
be the chairperson of a supervisory board (or of a one-tier board) of another large Dutch company
or foundation. The number of a Non-Executive Director’s supervisory (or non-executive) positions
of large Dutch companies or foundations shall be limited to a maximum of five, for which purpose
the chairmanship of a supervisory board (or of a one-tier board) of another large Dutch company
or foundation counts twice. Executive Directors shall not pursue the candidacy for a supervisory (or
non-executive) or similar position in companies other than subsidiaries of the Company without the
Board’s prior approval. Such position may not conflict with the Company's interests. Other important
positions held by a Director shall be notified to the Board.
Diversity and inclusion
For the workforce as a whole, anti-discrimination and anti-harassment is dealt with in the Code
of Conduct, which encourages an inclusive environment that promotes individual expression,
creativity, innovation and achievement and emphasizes that within UMG diverse backgrounds and
skills are valued as well as other individual differences.
Specifically for the Board and senior management
1
, the Board has also adopted a separate diversity
and inclusion policy (the D&I Policy) as per articles 2:142b and 2:166 of the Dutch Civil Code and
best practice provision 2.1.5 of the Code, laying down the elements of a diverse and inclusive
composition of the Board and senior management as well as appropriate and ambitious aspirations
in this respect.
As set out in the D&I Policy, the Company acknowledges the benefits of greater diversity, including
with regards to gender or gender identity, age, nationality, ethnicity and cultural or other background,
and remains committed to ensuring that the Directors and senior managers bring a wide range of
expertise, experience, competencies, other personal qualities and perspectives. All (nominations for)
1
For purposes of the D&I Policy, senior management is comprised of: (i) the Executive Directors, including the Chairman and Chief Executive Officer (the Chairman and CEO), (ii) the Chairman and CEO’s direct reports who lead a label or business or with
a primary function, (iii) for other key labels or businesses, their leaders and in some instances, certain of their direct reports, and (iv) key large function leaders.
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appointments to the Board and senior management will be made based on merit against objective
criteria, in the context of the overall balance of expertise, experience, competencies, other personal
qualities and perspectives that are needed for the Company to remain effective.
The Board
With respect to the Board, the Company is committed to promoting diversity and inclusion in the
boardroom and to ensuring that all Directors are able to contribute to Board discussions and has
the aspiration:
■
to improve or safeguard gender diversity among the Non-Executive Directors, such that at least
one third of the Non-Executive Directors is female and at least one third of the Non-Executive
Directors is male, thereby at all times taking into account the Dutch statutory gender diversity
requirement with regards to the Non-Executive Directors;
■
to improve gender diversity among the Executive Directors, such that at least one Executive
Director is female and at least one Executive Director is male in the event that there are three
(or more) Executive Directors; and
■
to improve or safeguard diversity with regards to age, nationality, ethnicity and cultural or other
background as well as to create and maintain a variation in expertise, experience, competencies,
other personal qualities and perspectives within the Board.
The Company is further committed to considering candidates for Non-Executive Director positions
from a wide pool, including candidates with no prior publicly listed company board level experience.
The Nomination Committee (as defined under "The Board––Board committees") is responsible for
supporting the Board in applying the D&I Policy with respect to the composition of the Board by
annually assessing the Board’s size and composition and, as part thereof, for considering (i) with
respect to the Directors in general, the level of diversity with regards to expertise, experience,
competencies, other personal qualities, perspectives, gender or gender identity, age, nationality,
ethnicity and cultural or other background and (ii) with respect to the Non-Executive Directors
in particular, the level of independence, ahead of making recommendations to the Board for any
proposed changes. In addition, the Nomination Committee is required to consider the benefits of
all aspects of diversity, without compromises as to the caliber of the candidate Directors, when
identifying candidate Directors to be nominated for appointment to the Board.
The senior management
With respect to the senior management, the Company is committed to promoting diversity and
inclusion among the senior managers and has the aspiration:
■
to improve gender diversity among the senior managers, such that by December 31, 2026, at least
20% of the senior managers is female, which would reflect a 2.5% increase compared to December
31, 2023, i.e., the date on which the D&I Policy became effective, and at least 20% of the senior
managers is male; and
■
to improve or safeguard diversity with regards to age, nationality, ethnicity and cultural or other
background as well as to create and maintain a variation in expertise, experience, competencies,
other personal qualities and perspectives within the senior management.
For purposes of the D&I Policy and the aspirations laid down therein, as at December 31, 2024, the
senior management was comprised of 69 senior managers.
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Overview
The following table provides an overview of the composition of the Executive Directors, Non-
Executive Directors and senior managers by gender as at December 31, 2024:
Directors
Executive
Directors
Non-
Executive
Directors
Senior
Managers
Female 5 0 5 13
Male 9 2 7 56
Total female
and male
14 2 12 69
% Female 36 0 42 18.8
% Male 64 100 58 81.2
The composition of the Board as at December 31, 2024 was considered to be diverse and with the
appointment of Eric Sprunk and Mandy Ginsberg to the Board by the General Meeting on May 16,
2024, the diversity further increased, particularly with regards to expertise and experience. With
women representing 36% of all Directors and 42% of the Non-Executive Directors, the composition
of the Board and the Non-Executive Directors as at December 31, 2024 was in line with the gender
diversity aspiration included in the D&I Policy as well as with the gender diversity requirement
included in Dutch law. With no recent changes to the composition, and with women representing 0%,
of the Executive Directors, the composition of the Executive Directors as at December 31, 2024 was
not in line with the gender diversity aspiration included in the D&I Policy. To monitor and address
these factors, when assessing the Board’s composition - which is done on an annual basis - and
whilst recruiting to the Board, the D&I Policy (including the aspirations included therein) and the
Profile for Non-Executive Directors will be taken into consideration.
While the composition of the senior management as at December 31, 2024 was considered to be
diverse, the Company acknowledges that there is room for improvement, especially with regards to
gender diversity. Although such improvement cannot happen overnight, especially since the senior
managers are typically committed to the Company for the long term, the Company has the aspiration
that by December 31, 2026, at least 20% of the senior managers is female, which would reflect a 2.5%
increase compared to December 31, 2023, i.e., the date on which the D&I Policy became effective. With
women representing 18.8% of all senior managers as at December 31, 2024, compared to 17.5% of all
senior managers as at December 31, 2023, gender diversity has improved by 1.3%.
Actions to improve diversity and inclusion
The Company believes that the best way to foster an environment where original ideas are generated
and creativity can flourish is to build an inclusive workplace that attracts and promotes talent from
diverse backgrounds and cultures. Key actions to foster, and further enhance, such an environment
are set out in “S1: Own Workforce” of the Sustainability Statement and include:
Embracing cultural differences and raising awareness
■
The Company recognizes many cultural milestones and historically significant events.
■
The Company’s employee resource groups (ERGs) provide a platform for underrepresented
employees to network, share experiences and help shape employee programming, and play a
crucial role in supporting the Company’s commitment to fostering inclusion and belonging.
Attracting and retaining talent
■
To attract the next generation of talent, the Company hosts internship programs, allowing a
diverse group of students to take part in such programs.
■
The Company provides inclusive interviewing training to further support its goal of championing
inclusion and belonging throughout the employee lifecycle.
■
The Company is putting in place a workforce data insights initiative, which includes
the implementation of a global job architecture and a quarterly review of workforce
changes, including turnover, to allow it to improve and prioritize its talent attraction and
retention programs.
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Enhancing employee experience and development
■
To obtain feedback on the employee experience, the Company uses a series of employee lifecycle
surveys as well as exit surveys. The insights so obtained are turned into actions to further
enhance the employee experience.
■
To cultivate leadership, the Company offers multiple programs specifically developed to drive
leadership preparedness.
■
While the Company already offers a broad range of employee development opportunities, it
plans to further expand the number of initiatives, including to programs centered on career
conversations and personal development, plans for future workforce needs and plans to link
personal development to specific skills with career paths.
Ensuring equitable pay practices
■
The Company supports equitable pay practices through the implementation of a global job
architecture, in which individual pay reflects experience, skillset, performance against goals and
scope of responsibilities but does not differentiate on the basis of protected characteristics.
Supporting employee wellbeing
■
As the Company is committed to enhancing its appeal as an employer and creating a positive
and healthy workplace, it provides programming and support for a Company-wide culture of
physical health, mental health and overall wellbeing. The Company has in place regionally-
specific employee assistance programs, which, among others, include counseling sessions,
in-the-moment support for emotional wellness, self-guided mindfulness, cognitive behavioral
therapy programs and work-life assistance.
Mitigating measures
■
As the Company promotes a respectful workplace, where harassment and discrimination have no
place, the Company offers multiple options for employees to seek guidance and report potential
instances of misconduct, including concerns related to harassment and discrimination, without
fear for retaliation.
Conflicts of interest and related party transactions
A Director may not take part in the discussions and/or decision-making process of the Board where
it concerns (i) a transaction in respect of which he or she has a direct or indirect personal conflict
of interest with the Company or one of its subsidiaries (a conflict of interest) or (ii) a related party
transaction in which he or she is involved. If the Board is unable to take a decision as a result of all
Directors being unable to take part in the discussions and/or decision-making process of the Board
due to a conflict of interest or due to all Directors being involved in a related party transaction, the
decision shall nevertheless be taken by the Board.
The Board has drawn up a related party transactions policy (the RPT Policy) for the purpose of
providing a procedure that prevents related parties from taking advantage of their position as well
as adequate protection for the interests of the Company and its stakeholders. In accordance with
the RPT Policy, (i) any transaction in respect of which a Director has a (potential) conflict of interest
that is of material significance to the Company and/or the Director concerned (a Code RPT) or (ii) any
material related party transaction in which a Director is involved and that is not entered into in the
ordinary course of business and under normal market conditions (a DCC RPT, and together with a
Code RPT, a Related Party Transaction) must be approved by the Board.
In accordance with the RPT Policy, a Director shall promptly notify any (potential) Related Party
Transaction to the Chairman of the Board; the Chairman of the Board shall promptly notify any
(potential) Related Party Transaction to the Vice-Chairman of the Board. In so notifying the Chairman
of the Board or the Vice-Chairman of the Board, the Director concerned must provide all relevant
information, including information relevant to the situation concerning any close family member.
In accordance with best practice provisions 2.7.3 and 2.7.4 of the Code, any Code RPT must be
approved by the Board, entered into on terms which are customary in the market, and published
in the Board report together with a statement of the conflict of interest and a declaration that best
practice provisions 2.7.3 and 2.7.4 of the Code have been complied with.
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In accordance with best practice provision 2.7.5 of the Code, any transaction between the Company
and a natural or legal person who or which holds at least 10% of the issued share capital of
the Company that is of material significance to the Company and/or the natural or legal person
concerned must be approved by the Board, entered into on terms which are customary in the market
and published in the Board report together with a declaration that best practice provision 2.7.5 of the
Code has been complied with.
In the financial year 2024, there was one Code RPT in respect of which a Non-Executive Director had
a (potential) conflict of interest (within the meaning of the Code) that was of material significance
to the Company: as part of the Tencent-led consortium's acquisition of its stake in UMG, Tencent
Music Entertainment was originally granted a call option to acquire up to 25% (but no less than
20%) of the share capital of the holding company which controls UMG's Greater China operations. As
previously disclosed, on June 16, 2022, the call option was amended as follows: (i) the counterparty
was changed to Tencent Holdings, (ii) Tencent Holdings was granted the option to acquire up to 12.5%
(but no less than 10%) of the share capital of the holding company which controls UMG's Greater
China operations and (iii) Tencent Holdings had 24 months from the date of granting to exercise the
call option. As the exercise period was due to expire, the call option was further amended, extending
Tencent Holdings' right to exercise the call option until June 16, 2025.
In Note 25 ‘Related parties’ to the consolidated financial statements, details of all related party
transactions (including DCC RPTs, if any) are set out.
Resolutions subject to approval of the Board
In addition to Related Party Transactions, which require the approval of the Board as set out under
"The Board––Conflicts of interest and related party transactions", in accordance with the Board
Regulations, the Company does not enter into any transaction with a value in excess of €300,000,000
that relates to (i) a disposal, sale or acquisition of all or a portion of investments in any company,
business or group created or to be created, whatever its legal form, (ii) a proposal or approach to
a third party concerning a significant transaction involving the Company or any of its subsidiaries
and (iii) a financing activity (including a bank loan, overdraft, vendor financing, asset securitization
program, pension fund or transaction involving a joint venture or minority interest) and the granting
of a guarantee or security right, without the approval of the Board.
Remuneration
The remuneration of the individual Executive Directors and Non-Executive Directors shall be
determined by the Board with observance of the remuneration policies for the Executive Directors
and Non-Executive Directors, respectively. The Executive Directors shall not participate in the
discussions and/or decision-making process regarding the determination of the remuneration of the
Executive Directors. The remuneration policies as well as the main elements of the agreements with
Sir Lucian Grainge and Vincent Vallejo are available on the investor relations part of the UMG website.
In the Remuneration Report, details of the individual remuneration of the Executive Directors and
Non-Executive Directors are set out.
As per the remuneration policy for the Executive Directors, part of the remuneration of the Executive
Directors can consist of short-term and long-term incentives. The short-term and long-term
incentive plans for the Executive Directors (as described in detail in the Remuneration Report) do
not currently incorporate key performance indicators linked to sustainability matters. The Board
may explore the inclusion thereof in the short-term and/or long-term incentive plans for the
Executive Directors in future years. As per the remuneration policy for the Non-Executive Directors,
the remuneration of the Non-Executive Directors, which consists of a cash retainer and an annual
grant of restricted share units (RSUs), is fixed and not dependent on the Company’s results or the
attainment of key performance indicators, whether or not linked to sustainability matters.
Severance
Under his employment agreement, Sir Lucian Grainge is entitled to severance payments as set out
in the Remuneration Report under "Severance payments and termination provisions--Sir Lucian
Grainge" in the event of (i) termination of his employment agreement by Sir Lucian Grainge
for good reason, which includes a change in control (as defined in the Remuneration Report
under "Severance payments and termination provisions--Sir Lucian Grainge"), (ii) termination of
his employment agreement by Universal Music Group, Inc. (i.e., the formal employer of Sir Lucian
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Grainge) without cause or (iii) non-renewal of his employment agreement by Universal Music
Group, Inc.
Under his management services agreement, Vincent Vallejo is not entitled to any severance
payments in the event of termination or non-renewal of his management services agreement; he
is, however, entitled to severance payments in accordance with Dutch law.
Directors’ and officers’ liability insurance policy and indemnity
The Executive Directors and Non-Executive Directors as well as certain officers are insured under
a directors’ and officers’ liability insurance policy taken out by the Company against damages
resulting from their conduct when acting in their capacities as Directors or officers with coverage
and terms customary for a publicly listed company of the size of the Company. Although the policy
provides for broad coverage, the Executive Directors, Non-Executive Directors and officers may
become subject to uninsured liabilities.
In addition, pursuant to the Articles, the Company has agreed to indemnify each Executive Director
and each Non-Executive Director for any claim against him or her that he or she may derive from
exercising his or her duties as an Executive Director or Non-Executive Director, provided that he or
she acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to,
the best interests of the Company or out of his or her mandate and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.
Board committees
The Board has appointed from among its Non-Executive Directors three Board committees
to assist it in discharging its responsibilities: an audit committee (the Audit Committee),
a remuneration committee (the Remuneration Committee) and a nomination committee (the
Nomination Committee). Without prejudice to the collegiate responsibility of the Board, the duty of
these Board committees is to prepare the decision-making of the Board.
The Board has drawn up regulations for each Board committee, setting out the role and
responsibilities of the Board committee concerned, its composition and size and the manner in
which its meetings should be held. These regulations are available on the investor relations part of
the UMG website.
The Non-Executive Directors' Report states the composition of the Board committees, the number of
meetings held and the main items discussed at such meetings.
The Audit Committee
According to the regulations of the Audit Committee, the Audit Committee shall advise the Board
in relation to its responsibilities, shall undertake preparatory work for the Board’s decision-making
regarding the supervision of the integrity and quality of the Company’s financial and sustainability
reporting and the effectiveness of the Company’s internal risk management and control systems
and shall prepare resolutions of the Board in relation thereto.
In addition to the foregoing, the Audit Committee’s main responsibilities include: (i) supervising
and monitoring, and discussing with and advising the Board on, the effectiveness of the design
and operation of the internal risk management and control systems, including supervising the
enforcement of all applicable laws and regulations and supervising the effect of the Code of Conduct,
(ii) supervising the preparation and submission of financial and sustainability information by the
Company, (iii) supervising the compliance with recommendations, comments and observations of
the internal auditor, the external auditor(s) and any other external party involved in the auditing of
the sustainability reporting, (iv) instructing the external auditor(s) and the internal audit function
to inform the Executive Directors and the chair of the Audit Committee without delay if it or they
discover(s) or suspect(s) an instance of misconduct or irregularity, (v) supervising the functioning of
the internal audit function, (vi) ensuring that the way in which the internal audit function fulfills its
responsibility is assessed by an independent third party at least every five years, (vii) supervising
the policy of the Company on tax planning, (viii) supervising the financing of the Company, (ix)
supervising the applications of information and communication technology, including risks relating
to cybersecurity and data protection and risks relating to new technologies, (x) maintaining frequent
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contact and supervising the relationship with the internal auditor, the external auditor(s) and any
other external party involved in the auditing of the sustainability reporting, (xi) implementing
the procedure for the selection of the external auditor(s) and submitting a recommendation to
the Non-Executive Directors for the (re)appointment or dismissal of the external auditor(s) by the
General Meeting, (xii) informing the Board of the outcome of the statutory audit and explaining
how the statutory audit contributed to the integrity of the financial reporting and what the role of
the Audit Committee was in that process, (xiii) monitoring the financial reporting and submitting
recommendations or proposals to ensure its integrity, (xiv) determining whether, and if so, how the
external auditor(s) shall be involved in the content and publication of financial reports other than
the financial statements, (xv) issuing a recommendation on the appointment and dismissal of the
senior internal auditor, (xvi) submitting a proposal to the Board for the engagement of the external
auditor(s) to audit the financial statements and (xvii) considering and, where appropriate, approving
for recommendation to the Board the (semi-annual) financial statements, the annual budget and
major capital expenditures of the Company.
The Audit Committee shall consist of at least three members appointed by the Board from among
its Non-Executive Directors. More than half of the members of the Audit Committee, including the
chair of the Audit Committee, shall be independent within the meaning of best practice provision
2.1.8 of the Code. The Audit Committee may not be chaired by the Chairman of the Board or by
a former Executive Director. At least one member of the Audit Committee shall have competence
in accounting and/or auditing and the members of the Audit Committee as a whole shall have
competence relevant to the sector in which the Company operates.
The Audit Committee shall hold at least four meetings per year and whenever one or more of its
members have requested a meeting. The quorum of any meeting shall be a majority of the members
of the Audit Committee. The Audit Committee shall meet with the external auditor(s) as often as it
considers necessary, but at least once a year, outside the presence of the Executive Directors. The
Chief Financial Officer, the Chief Audit Executive and the external auditor(s) shall in principle attend
the meetings of the Audit Committee, unless the Audit Committee determines otherwise. The Audit
Committee shall decide whether and, if so, when the Chairman of the Board shall attend its meetings.
The Remuneration Committee
According to the regulations of the Remuneration Committee, the Remuneration Committee shall
advise the Board in relation to its responsibilities, shall undertake preparatory work for the Board’s
decision-making regarding the determination of the remuneration of the individual Executive
Directors and Non-Executive Directors, with observance of the remuneration policies for the
Executive Directors and Non-Executive Directors, respectively, and shall prepare resolutions of the
Board in relation thereto.
In addition to the foregoing, the Remuneration Committee’s main responsibilities include: (i) at least
every four years, submitting a proposal to the Board for the remuneration policies for the Executive
Directors and Non-Executive Directors, to be submitted to the annual General Meeting for adoption
and (ii) annually preparing the remuneration report, to be submitted to the annual General Meeting
for a non-binding advisory vote.
The Remuneration Committee shall consist of at least three members appointed by the Board
from among its Non-Executive Directors. More than half of the members of the Remuneration
Committee shall be independent within the meaning of best practice provision 2.1.8 of the Code.
The Remuneration Committee may not be chaired by the Chairman of the Board or by a former
Executive Director.
The Remuneration Committee shall hold at least two meetings per year and whenever one or more
of its members have requested a meeting. The quorum of any meeting shall be a majority of the
members of the Remuneration Committee.
The Nomination Committee
According to the regulations of the Nomination Committee, the Nomination Committee shall advise
the Board in relation to its responsibilities, shall undertake preparatory work for the Board’s
decision-making and shall prepare resolutions of the Board in relation thereto.
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In addition to the foregoing, the Nomination Committee’s main responsibilities include: (i) drawing
up selection criteria and appointment procedures for Directors, (ii) annually assessing the size and
composition of the Board, and making a proposal for the profile for Non-Executive Directors, (iii)
annually evaluating the functioning of the Board as a whole, the individual Directors and the various
Board committees, ensuring that such evaluation periodically takes place under the supervision of
an external expert and reporting on this to the Board, (iv) formulating succession plans and drawing
up a retirement schedule, (v) making recommendations for the (re)appointment of Directors and
(vi) supervising the policy of the Board on the selection criteria and appointment procedures for
senior management.
The Nomination Committee shall consist of at least three members appointed by the Board from
among its Non-Executive Directors. More than half of the members of the Nomination Committee
shall be independent within the meaning of best practice provision 2.1.8 of the Code.
The Nomination Committee shall hold at least two meetings per year and whenever one or more
of its members have requested a meeting. The quorum of any meeting shall be a majority of the
members of the Nomination Committee.
The Market Disclosure Committee
The Board has also appointed a market disclosure committee (the Market Disclosure Committee),
consisting of seven members, which is responsible for the timely and accurate disclosure of all
information that is required to be so disclosed to the market in order to meet the applicable legal
and regulatory obligations and requirements arising from the Listing.
The Market Disclosure Committee shall meet whenever necessary to fulfill its responsibilities and
meetings can be called by and at the request of any of the members of the Market Disclosure
Committee. The Market Disclosure Committee is not a committee of the Board although its members
are appointed by the Board.
Sustainability management
The Board is responsible for developing a view on sustainable long-term value creation by the
Company and for formulating a strategy as well as specific objectives in line with this view, which
includes overseeing the Company’s sustainability impacts, risks and opportunities, as well as the
integrity of the Company’s sustainability reporting. The Audit Committee supports and advises the
Board in relation to these responsibilities, as enshrined in the regulations of the Audit Committee,
and covers environmental, social, and governance (ESG) topics on its agenda.
The Company’s ESG team, led by the Head of Sustainability, is responsible for developing and
updating the Company’s sustainability strategy, measuring performance, driving compliance with
sustainability-related regulations and briefing the Board and, as applicable, Board committees, on
these activities.
At management level, executive leaders within each business unit are responsible for the day-to-
day oversight and management of applicable impacts, risks and opportunities, including for setting
and measuring key progress indicators and implementing and maintaining applicable policies.
These functions are discussed in greater detail within the relevant sections of the Annual Report.
The Board and Board committees are also regularly briefed on the Company’s material topics, both
in writing and during meetings, and have spent significant time discussing several of these topics,
including UMG’s relationships with its artists, content protection in general, and in particular in the
context of risks posed by (generative) artificial intelligence and employee attraction and retention,
including through the implementation of the 2022 UMG Global Equity Plan.
In 2023, a cross-functional steering committee (the SteerCo) was formed, which reviewed, approved
and advised on each phase of the process to identify the Company’s material impacts, risks
and opportunities, including the validation and reporting of the results of the double materiality
assessment process (the DMA). The ESG team regularly briefs the SteerCo on relevant sustainability
matters. In addition, in 2024, the SteerCo received briefings and trainings from external subject
matter experts.
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The SteerCo is composed of senior leaders across UMG’s business units, including the:
■
Senior Vice President, Head of Sustainability
■
Executive Vice President and Chief Compliance Officer
■
Senior Vice Presidents of Business and Legal Affairs
■
Head of People Operations and Systems
■
Senior Vice President of Business Affairs and Compliance
■
Vice President of Investor Relations
■
Senior Vice President and Chief Audit Executive
■
Senior Vice President, Chief Future of Work Architect and People Business Partner
■
Senior Vice President of Information Technology Strategy
■
Senior Vice President of Global Financial Reporting and Analysis
■
Senior Vice President of Public Affairs, Europe
■
Vice President of Internal Audit and Control Assurance
The ESG team integrates sustainable business practices across the Company by executing a
comprehensive ESG management system. Among other efforts, the ESG team conducts all day-to-
day operations associated with developing and deploying the Company’s sustainability strategy,
measurement and reporting, including the execution of the DMA. The ESG team also mobilizes cross-
functional ESG working groups to operationalize sustainability commitments within each group’s
sphere of influence, through key performance indicator monitoring, target setting and program
implementation. Key ESG working groups include Universal Manufacturing and Logistics (UML),
Bravado and Global Travel. In 2024, the UML and Bravado working groups met on a monthly basis,
and the Global Travel working group met on a quarterly basis.
THE GENERAL MEETING
Annual and extraordinary General Meetings
The Shareholders exercise their rights through annual and extraordinary General Meetings.
Annual General Meetings
The annual General Meeting shall be held within six months after the end of the financial year.
The agenda of the annual General Meeting typically includes the following (discussion or voting)
items: (i) the discussion of the Annual Report, (ii) the consideration of the remuneration report, (iii)
the adoption of the financial statements, (iv) the discussion of the dividend policy and the proposal
to distribute dividends, (v) the discharge of the Directors for the performance of their duties, (vi)
the (re)appointment of Directors, (vii) the adoption of the remuneration policies for the Executive
Directors and Non-Executive Directors insofar as any adjustments to the remuneration policies so
require or four years after their former adoption, (viii) the appointment of the external auditor(s) to
audit the financial statements, and (ix) any other items brought forward by the Board.
Extraordinary General Meetings
Extraordinary General Meetings shall be held as often as the Board deems necessary. In addition,
one or more of the Shareholders representing individually or jointly at least 10% of the issued
share capital of the Company are entitled to request the Board in writing that a General Meeting is
convened, the request setting out in detail the items to be discussed. If the Board has not taken the
steps necessary to ensure that a General Meeting can be held within eight weeks of the request, the
relevant Shareholder or Shareholders may at its or their request be authorized by a Dutch court in
summary proceedings to convene a General Meeting. In any event, a General Meeting shall be held
to discuss any requisite measures within three months of it becoming apparent to the Board that the
shareholders’ equity of the Company has decreased to an amount equal to or lower than 50% of the
paid-up and called-up part of the share capital of the Company.
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Place
According to the Articles, General Meetings shall be held in Amsterdam, Rotterdam, Hilversum or
Haarlemmermeer (including Schiphol Airport).
Convocation
A General Meeting is convened by the Board by means of a convocation notice, which must be given
at least forty-two days before the day of the General Meeting.
Right to include items on the agenda
One or more of the Shareholders representing individually or jointly at least 3% of the issued share
capital of the Company are entitled to request the Company in writing that an item is included on
the agenda of the General Meeting. The request must be sufficiently motivated and received by the
Company at least sixty days before the day of the General Meeting. The Company cannot be forced
to include a voting item on the agenda of the General Meeting where the voting item concerns a
matter which does not lie within the powers of the General Meeting. In accordance with best practice
provision 4.1.6 of the Code, the Shareholders are expected to only exercise the right of including an
item on the agenda of the General Meeting after having consulted the Board in that respect.
Response time
If one or more of the Shareholders request that an item is included on the agenda of the General
Meeting that may result in a change in the Company’s strategy (via, for example, a change in
the composition of the Board), the Board may invoke a response time. The possibility to invoke
a response time also applies to a request of such Shareholder or Shareholders to be authorized
to convene a General Meeting as set out under "The General Meeting––Annual and extraordinary
General Meetings––Extraordinary General Meetings".
Chairperson of the General Meeting
The General Meeting shall be presided over by the Chairman of the Board or another Director
designated for that purpose by the Board. If the Chairman of the Board is not present at the General
Meeting and no other Director has been designated by the Board to preside over the General Meeting,
the General Meeting itself shall appoint a chairperson of the General Meeting. The chairperson
has all powers necessary to ensure the orderly and efficient conduct of the General Meeting. The
chairperson decides on all matters relating to admission to the General Meeting and may admit
third parties to the General Meeting. The Directors are in any event authorized to attend the General
Meeting, in which they have an advisory vote. The external auditor(s) is or are also authorized to
attend the General Meeting.
Participation
Each Shareholder is entitled, in person or represented by a proxy authorized in writing, to attend and
address the General Meeting and to exercise its voting rights. Each Shareholder may exercise such
rights if it is a Shareholder on the record date, which is the twenty-eighth day before the day of the
General Meeting, and it has notified the Company in writing of its intention to do so in the manner
and by the date specified in the convocation notice. The Board may determine that a Shareholder
entitled to exercise its voting rights may cast its vote prior to the General Meeting by means of
electronic communication or letter. Votes cast in accordance with the previous sentence rank equal
to votes cast at the General Meeting.
Each Share confers the right on the holder thereof to cast one vote at the General Meeting. All
resolutions of the General Meeting shall be adopted by a simple majority of the votes cast, unless
Dutch law or the Articles require a qualified majority. Some resolutions require a qualified majority
if less than half of the issued share capital of the Company is present or represented at the General
Meeting. No special control rights are attached to the Shares. There are no restrictions on the
exercise of voting rights under Dutch law or the Articles nor, as far as the Company is aware, under
the Relationship Agreement.
The General Meeting has authority to adopt resolutions concerning, among others, the
following matters:
■
the issue of Shares or the granting of rights to subscribe for Shares (and to designate the Board as
the competent body to issue Shares or to grant rights to subscribe for Shares);
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■
the limitation or exclusion of the pre-emptive right in relation to Shares or rights to subscribe for
Shares (and to designate the Board as the competent body to limit or exclude the pre-emptive
right in relation to Shares or rights to subscribe for Shares);
■
the authorization of the Board to acquire Shares on behalf of the Company;
■
the reduction of the issued share capital of the Company;
■
the (re)appointment of Executive Directors and Non-Executive Directors;
■
the suspension and dismissal of Executive Directors and Non-Executive Directors;
■
the adoption of the remuneration policies for the Executive Directors and Non-Executive Directors;
■
the adoption of the financial statements;
■
the appointment of the external auditor(s) to audit the financial statements;
■
the distribution of dividends;
■
the amendment of the Articles;
■
the dissolution of the Company.
No resolutions may be adopted on items other than those that have been included on the agenda of
the General Meeting (unless the resolution would be adopted unanimously during a General Meeting
where the entire issued share capital of the Company is present or represented).
Resolutions of the Board regarding a significant change in the identity or character of the Company
or its business are subject to the approval of the General Meeting. Such changes include in
any event:
■
the transfer of the business or practically the entire business to a third party;
■
the conclusion or cancellation of any long-lasting cooperation of the Company or a subsidiary
with any other legal person or company or as a fully-liable general partner in a partnership,
provided that the conclusion or cancellation of such cooperation is of material significance to
the Company;
■
the acquisition or disposal of a participation in the issued share capital of a company with a value
of at least one third of the assets, as shown in the consolidated balance sheet with explanatory
notes according to the most recently adopted consolidated financial statements, by the Company
or a subsidiary.
Minutes
Minutes of the proceedings at the General Meeting shall be kept by a secretary who shall be
designated by the chairperson of the General Meeting. Within three months after the close of the
General Meeting, the minutes shall be made available to the Shareholders, which then have the
opportunity to provide their comments in the three months thereafter. The minutes shall then be
adopted by the chairperson and the secretary and signed by them as evidence thereof.
Issue of Shares and limitation or exclusion of pre-emptive right
The General Meeting is authorized to issue Shares. The General Meeting may designate the Board as
the competent body to issue Shares and to determine the issue price and other conditions of the
issue for a specified period not exceeding five years (which period can be extended from time to
time for further periods not exceeding five years). Such designation must state the number of Shares
that may be so issued. The General Meeting shall, in addition to the Board, remain authorized to
issue Shares if such is specifically stipulated in the resolution of the General Meeting designating
the Board as the competent body to issue Shares. A resolution of the General Meeting to issue
Shares and a resolution of the General Meeting designating the Board as the competent body to
issue Shares can only be adopted at the proposal of the Board. The foregoing applies by analogy to
the granting of rights to subscribe for Shares but does not apply to the issue of Shares to a person
exercising a previously granted right to subscribe for Shares.
Each Shareholder has a pre-emptive right in proportion to the aggregate number of its Shares upon
an issue of Shares. The pre-emptive right does not apply to: (i) Shares issued to employees of the
Company or of a group company, (ii) Shares issued against payment other than in cash and (iii)
Shares issued to a person exercising a previously granted right to subscribe for Shares. The pre-
emptive right may be limited or excluded by a resolution of the General Meeting. The pre-emptive
right may also be limited or excluded by a resolution of the Board if the Board has been designated
as the competent body to limit or exclude the pre-emptive right by the General Meeting for a
specified period not exceeding five years (which period can be extended from time to time for further
periods not exceeding five years), and the Board has also been designated as the competent body
to issue Shares by the General Meeting. A resolution of the General Meeting to limit or exclude the
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pre-emptive right and a resolution of the General Meeting designating the Board as the competent
body to limit or exclude the pre-emptive right can only be adopted at the proposal of the Board and
requires a qualified majority of at least two thirds of the votes cast if less than half of the issued
share capital of the Company is present or represented at the General Meeting. The foregoing applies
by analogy to the granting of rights to subscribe for Shares.
On May 12, 2022, the General Meeting approved the 2022 Universal Music Group Global Equity Plan
(the 2022 UMG Global Equity Plan) as well as the issuance of Shares or the granting of rights to
subscribe for Shares in order to give effect to awards granted under the 2022 UMG Global Equity Plan
to employees of the Company and its subsidiaries and to Executive Directors up to a total amount
of 5% of the issued share capital of the Company as at May 12, 2022 (the Share Pool) and, to the
extent necessary, the exclusion of the statutory pre-emptive right with respect to such Shares or
rights to subscribe for Shares. On May 16, 2024, the General Meeting further approved the issuance
of Shares or the granting of rights to subscribe for Shares in order to give effect to the granting of
a fixed Euro amount of awards to Non-Executive Directors under the remuneration policy for the
Non-Executive Directors from the same Share Pool and for the same five-year period calculated as
from May 12, 2022, and to the extent necessary, the exclusion of the statutory pre-emptive right with
respect to such Shares or rights to subscribe for Shares. The actual number of Shares to be issued
or rights to subscribe for Shares to be granted in order to give effect to awards granted under the
2022 UMG Global Equity Plan is determinable by the Board (or a committee of the Board designated
for such purpose).
Acquisition of Shares
The Company cannot subscribe for Shares. The Company may, however, acquire fully paid-up Shares
for no consideration or under universal title of succession. In addition, the Company may acquire
fully paid-up Shares against consideration if (i) the shareholders’ equity of the Company less the
acquisition price of the Shares does not fall below the sum of the paid-up and called-up part of the
share capital of the Company and any reserves that must be maintained pursuant to Dutch law,
(ii) the aggregate nominal value of the Shares which the Company acquires, holds or on which it
holds a right of pledge or which are held by a subsidiary does not exceed 50% of the issued share
capital of the Company and (iii) the Board has been authorized to acquire Shares on behalf of the
Company by the General Meeting. Such authorization is valid for a maximum period of eighteen
months and as part of the authorization, the General Meeting must specify the number of Shares that
may be acquired as well as the manner in which and the price range within which the Shares may
be acquired. Such authorization is not required if the Company acquires fully paid-up Shares for the
purpose of transferring such Shares to employees of the Company or of a group company under an
equity compensation plan. Any acquisition of Shares that are not fully paid-up shall be null and void.
In calculating the amount of any dividend distribution on the Shares, Shares held by the Company
shall be disregarded, unless such Shares are encumbered with a right of pledge or usufruct.
Furthermore, the Company or a subsidiary may not cast votes in respect of Shares held by it or
on which it holds a right of pledge or usufruct. However, a holder of a right of pledge or usufruct on
Shares held by the Company or a subsidiary may cast votes in respect of such Shares, if the right
of pledge or usufruct was created before the Shares were acquired by the Company or a subsidiary.
In determining how many votes can be cast, how many Shareholders are present or represented
or which part of the issued share capital of the Company is present or represented at the General
Meeting, no account shall be taken of Shares in respect of which no votes can be cast.
On May 16, 2024, the General Meeting resolved to grant the Board the authority to cause the Company
to acquire Shares in an amount of up to and including 10% of the issued share capital of the
Company as at May 16, 2024, through acquisitions effected on the exchange or in any other matter,
provided that following the acquisition, the Company, together with its subsidiaries, does not hold
more than 10% of the issued share capital of the Company. The minimum price which the Company
may pay for a Share will be an amount equal to the nominal value of such Share. The maximum
price which the Company may pay for a Share will be an amount equal to 110% of the market price of
the Shares. The authorization so granted is valid for a period of eighteen months as of May 16, 2024.
Reduction of the issued share capital of the Company
At the proposal of the Board, the General Meeting may resolve to reduce the issued share capital of
the Company by (i) cancelling Shares held by the Company or (ii) reducing the nominal value of the
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Shares by way of an amendment of the Articles. A resolution of the General Meeting to reduce the
issued share capital of the Company requires a qualified majority of at least two thirds of the votes
cast if less than half of the issued share capital of the Company is present or represented at the
General Meeting.
On May 16, 2024, the General meeting resolved to grant the Board the authority to cancel any or all
Shares held by it in one or more tranches. The number of Shares that may be so cancelled (whether
or not in one tranche) may be determined by the Board but may in aggregate not exceed 10% of the
issued share capital of the Company as at May 16, 2024. The purpose of such cancellation would be
to optimize the Company’s capital structure.
Appointment of the external auditor(s)
The General Meeting shall appoint the external auditor(s) to audit the financial statements. The Non-
Executive Directors shall submit a nomination for the appointment of the external auditor(s) to the
General Meeting, upon the recommendation of the Audit Committee. Unless it concerns the renewal
of an audit engagement, the recommendation of the Audit Committee shall be prepared following a
selection procedure organized by the Company under the responsibility of the Audit Committee in
accordance with Regulation (EU) No 537/2014 of the European Parliament and of the Council of April
16, 2014 on specific requirements regarding statutory audit of public-interest entities.
On May 11, 2023, the General Meeting appointed Ernst & Young Accountants LLP as the external
auditor to audit the financial statements for the financial years 2023 up to and including 2025.
Amendment of the Articles
At the proposal of the Board, the General Meeting may resolve to amend the Articles. If a proposal
to amend the Articles is to be submitted to the General Meeting, the convocation notice must state
so and a copy of the proposal, including the verbatim text thereof, must be made available at the
Company’s office for inspection by, and must be made available free of charge to, the Shareholders
until after the close of the General Meeting. An amendment of the Articles requires a notarial deed.
Dutch Decree on Article 10 of the Takeover Directive
Pursuant to the Dutch Decree on Article 10 of the Takeover Directive, the Board report needs to
include information on, among others, the Company’s share capital structure, any restrictions on
voting rights and the transfer of Shares, substantial shareholdings in the Company, any special
control rights attached to the Shares, any system of control of any equity compensation plans
where the control rights are not exercised directly by the employees, the rules governing the
appointment and dismissal of Executive Directors and Non-Executive Directors and the amendment
of the Articles, the powers of the Board (in particular the power to issue Shares and to cause
the Company to acquire Shares), any material agreement to which the Company is a party and
which comes into force or is amended or terminated upon a change in control over the Company
following a takeover offer, and any agreement between the Company and a Director or employee
providing for compensation if his or her employment is terminated because of a takeover offer. The
information that needs to be included in the Board report pursuant to the Dutch Decree on Article
10 of the Takeover Directive is included in this Corporate Governance section and in the Shareholder
Information section.
Compliance with the Code
The Company acknowledges the importance of good corporate governance and complies with most
of the principles and best practice provisions of the Code, the full text of which can be found on
www.mccg.nl. Deviations from any of the principles and best practice provisions of the Code are
explained below in accordance with the Code’s ‘comply or explain’ principle. Substantial changes in
the Company’s corporate governance structure and in the Company’s compliance with the Code, if
any, will be dealt with at the annual General Meeting as a separate item.
Deviations
Best practice provision 2.1.7 item (iii) of the Code
Since, in the financial year 2024, two Non-Executive Directors, being James Mitchell and
Manning Doherty, were considered to be affiliated with and/or representing a (group of affiliated)
shareholder(s) holding, directly or indirectly, more than 10% of the issued share capital of the
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Company, i.e., the Tencent-led consortium, the Company did not comply with best practice provision
2.1.7 item (iii) of the Code, which recommends that at most one Non-Executive Director is considered
to be affiliated with or representing such (group of affiliated) shareholder(s). However, as Manning
Doherty recently resigned from the Board, effective March 21, 2025, there is now only one Non-
Executive Director, being James Mitchell, who is considered to be affiliated with and/or representing
the Tencent-led consortium, which means that the Company now complies with best practice
provision 2.1.7 item (iii) of the Code.
Best practice provision 2.1.10 of the Code
In the financial year 2024, the Company did not comply with best practice provision 2.1.10 of the
Code, which recommends that the Non-Executive Directors' Report states that the Non-Executive
Director independence requirements referred to in best practice provisions 2.1.7 up to and including
2.1.9 of the Code are being complied with. The reason for this deviation is that the Company could
not make this statement now that it deviated from best practice provision 2.1.7 item (iii) of the Code.
The Non-Executive Directors' Report does, however, set out in detail which Non-Executive Directors
were considered non-independent within the meaning of best practice provision 2.1.8 of the Code
in the financial year 2024 and why. Moreover, as Manning Doherty recently resigned from the Board,
effective March 21, 2025, the Company now complies with best practice provision 2.1.7 item (iii) of
the Code, which means that the statement recommended to be made pursuant to best practice
provision 2.1.10 of the Code can be included in the Non-Executive Directors' Report in next year's
annual report.
Best practice provision 2.2.1 of the Code
The Company does not comply with (the second sentence of) best practice provision 2.2.1 of the Code,
which recommends that an Executive Director may be reappointed for a term of not more than four
years at a time, now that the General Meeting, on May 11, 2023, reappointed Sir Lucian Grainge as
an Executive Director for a period ending on May 1, 2028. At the recommendation of the Nomination
Committee, the Board made its (non-binding) nomination for the reappointment of Sir Lucian Grainge
for such an extended period in order to align the term of his appointment as an Executive Director
with the term of his employment agreement.
Best practice provision 2.2.2 of the Code
The Company does not comply with (the first sentence of) best practice provision 2.2.2 of the Code,
which recommends that a Non-Executive Director is appointed for a period of four years and may
then be reappointed once for another four-year period, now that all Non-Executive Directors have
been appointed or reappointed by the General Meeting for a period of two years in order to comply
with the base scenario under the Articles.
Best practice provision 3.1.2 item (vi) of the Code
The Company does not comply with best practice provision 3.1.2 item (vi) of the Code, which
recommends that if shares are being granted, they should be held for at least five years after
the grant date. Although the awards granted to the Executive Directors under the 2022 UMG Global
Equity Plan are (and will be) subject to (multiple-year) time-based and/or performance-based vesting
requirements as set out in
Note 24 ‘Share-based compensation plans’ to the consolidated financial
statements, there is no requirement that Shares should continue to be held once vested. Considering
that the Company operates in a highly competitive environment, requiring the Executive Directors to
hold the Shares for at least five years after the grant date could meaningfully reduce the perceived
value of the awards for motivational and retention purposes, without reducing the cost to the
Shareholders in terms of dilution, while the vesting requirements attached to the awards are already
efficacious at aligning the Executive Directors’ and Shareholders’ interests.
Best practice provision 3.1.2 item (vii) of the Code
The Company does not comply with best practice provision 3.1.2 item (vii) of the Code, which
recommends that if share options are being granted, they should not be exercisable during the first
three years after they are granted. Although the performance stock options (the PSOs) granted under
the 2022 UMG Global Equity Plan to Sir Lucian Grainge are subject to (multiple-year) time-based and
performance-based vesting requirements, part of the PSOs could become exercisable within the first
three years after they were granted. On each of the first four anniversaries of the grant date, one
fourth of the PSOs will vest; in addition, one third of the PSOs will become eligible for exercise if the
first share price hurdle of €26.50 is met, one third of the PSOs will become eligible for exercise if the
second share price hurdle of €30.00 is met, and one third of the PSOs will become eligible for exercise
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if the third share price hurdle of €38.00 is met. Only those PSOs that have vested due to the passage
of time and have become eligible for exercise due to a share price hurdle having been met become
exercisable. One twelfth of the PSOs became exercisable during the financial year 2024 as those PSOs
had vested due to the passage of time and had become eligible for exercise due to the first share
price hurdle having been met.
Best practice provision 3.2.3 of the Code
Sir Lucian Grainge is entitled to severance payments as set out in the Remuneration Report
under "Severance payments and termination provisions--Sir Lucian Grainge" in the event of (i)
termination of his employment agreement by Sir Lucian Grainge for good reason, (ii) termination
of his employment agreement by Universal Music Group, Inc. (i.e., the formal employer of Sir Lucian
Grainge) without cause or (iii) non-renewal of his employment agreement by Universal Music Group,
Inc., which severance payments are in excess of (the fixed remuneration component of) one year's
salary. Accordingly, the Company does not comply with best practice provision 3.2.3 of the Code,
which recommends that any severance payments in the event of dismissal should not exceed (the
fixed remuneration component of) one year’s salary or be awarded in the event that the employment
agreement is terminated by the Executive Director. However, as the recommended severance
payments are inconsistent with industry practices in the primary fields in which the Company
competes for talent, i.e., the fields of United States media, entertainment and tech, complying with
best practice provision 3.2.3 of the Code could be detrimental to Executive Director recruitment and
retention. Accordingly, at the time of renewal of Sir Lucian Grainge’s employment agreement, it was
decided to agree to a severance arrangement, which is in deviation of best practice provision 3.2.3 of
the Code.
Best practice provision 3.3.2 of the Code
The Company does not comply with best practice provision 3.3.2 of the Code, which recommends
that Non-Executive Directors should not be awarded any remuneration in the form of shares and/or
rights to shares, now that pursuant to the revised remuneration policy for the Non-Executive
Directors, as adopted by the General Meeting on May 16, 2024, the Non-Executive Directors are
entitled to receive part of their remuneration in the form of RSUs. A revision of the remuneration
policy for the Non-Executive Directors was considered necessary to align the remuneration of the
Non-Executive Directors more closely with sector market peers and to enhance the Company’s
ability to attract, motivate and retain highly qualified individuals.
Corporate governance statement
Pursuant to the Dutch Decree on the Content of the Board Report, the Company is required to publish
a statement concerning its approach to corporate governance and compliance with the Code. The
information required to be included in this statement can be found in the following sections of the
Annual Report:
■
The information concerning compliance with the Code is set out under "Compliance with
the Code";
■
The information concerning the Company’s internal risk management and control systems
relating to the financial reporting process is set out in the Risk and Risk Management section;
■
The information concerning the functioning and powers of the General Meeting and the rights of
the Shareholders and how such rights can be exercised is set out under "The General Meeting";
■
The information concerning the composition and functioning of the Board and its Board
committees is set out under "The Board" and in the Non-Executive Directors' Report under
"Composition" and "Board Committees";
■
The information concerning the D&I Policy is set out under "The Board––Diversity and inclusion"
and in the Non-Executive Directors' Report under "Diversity and inclusion";
■
The information concerning the inclusion of the information required by the Dutch Decree
on Article 10 of the Takeover Directive is set out under "Dutch Decree on Article 10 of the
Takeover Directive".
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STATEMENTS OF THE BOARD
In control statement
In accordance with best practice provision 1.4.3 of the Code, the Board is of the opinion that for the
financial year 2024:
■
the Board report provides sufficient insight into any failings in the effectiveness of the internal
risk management and control systems with regards to the risks associated with the strategy
and activities of the Company and its affiliated enterprise, which in any case include strategic,
operational, compliance and reporting risks;
■
the internal risk management and control systems provide reasonable assurance that the
financial reporting does not contain any material inaccuracies;
■
based on the current state of affairs, it is justified that the financial reporting is prepared on a
going concern basis;
■
the Board report states those material risks associated with the strategy and activities of the
Company and its affiliated enterprise and uncertainties that are relevant to the expectation of the
Company’s continuity for the period of twelve months after the preparation of the Board report.
It should be noted that the foregoing does not imply that these systems and these procedures
provide absolute assurance as to the realization of operational and strategic business objectives or
that they can prevent all misstatements, inaccuracies, errors, fraud and non-compliance with all
applicable laws and regulations.
For a detailed description of the internal risk management and control systems and the principal
risks identified, please refer to the Risk and Risk Management section.
Responsibility statement
In accordance with article 5:25c(2)(c) of the Dutch Financial Supervision Act
(Wet op het financieel
toezicht),
the Board confirms that, to the best of its knowledge:
■
the financial statements 2024 give a true and fair view of the assets, liabilities, financial position
and profit or loss of the Company and the undertakings included in the consolidation as a whole;
■
the Board report provides a true and fair view of the position as at December 31, 2024 and of the
performance of the business during the financial year 2024 of the Company and the undertakings,
details of which have been included in the financial statements 2024; and
■
the Board report includes a description of the principal risks that the Company faces.
The Board, Hilversum, March 27, 2025
Sir Lucian Grainge
Vincent Vallejo
Sherry Lansing
Margaret Frerejean-Taittinger
Bill Ackman
Cathia Lawson-Hall
Cyrille Bolloré
Eric Sprunk
Haim Saban
James Mitchell
Luc van Os
Mandy Ginsberg
Nicole Avant
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SHAREHOLDER INFORMATION
SHARE CAPITAL
The authorized share capital of the Company amounts to €27,000 million and is divided into
2,700,000,000 ordinary shares with a nominal value of €10 per Share (the Shares). All Shares are
registered and numbered consecutively from one onwards.
As at December 31, 2024, the issued share capital of the Company amounted to €18,292,811,710
and was divided into 1,829,281,171 Shares, the Company held 214,235 Shares in treasury and no
depositary receipts for Shares were issued with the cooperation of the Company.
All Shares rank
pari passu
with each other. There are no restrictions on the transferability of
the Shares under Dutch law or the Articles nor, as far as the Company is aware, under the
Relationship Agreement.
Relationship Agreement
On September 8, 2021, Vivendi SE, Concerto Investment B.V., Scherzo Investment B.V., Compagnie de
l’Odet and Compagnie de Cornouaille (which merged into Bolloré SE on July 17, 2024) entered into
a relationship agreement (the Relationship Agreement), which was co-signed by the Company for
agreement and acknowledgement.
Further details on the Relationship Agreement are set out in the Corporate governance section under
"The General Meeting––Annual and extraordinary General Meetings––Participation", above under
"Share capital" and below under "Substantial shareholdings" and "Dividend policy".
Substantial shareholdings
Pursuant to the Dutch Financial Supervision Act, Shareholders are required to notify the Dutch
Authority for the Financial Markets (
Autoriteit Financiële Markten
) (the AFM) in the event that they
acquire or lose the disposal of a capital interest and/or voting rights in the Company as a result of
which their percentage of capital interest and/or voting rights in the Company reaches, exceeds or
falls below one of the following thresholds: 3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75%
and 95%. The requirement to notify the AFM also applies in the event that their percentage of capital
interest and/or voting rights in the Company passively reaches, exceeds or falls below one of the
thresholds due to a change in the issued share capital of and/or voting rights in the Company.
According to the AFM register, as at December 31, 2024, the following Shareholders had notified the
AFM of their capital interest and/or voting rights in the Company:
Shareholder Notification date Capital interest Voting rights
W.A. Ackman December 31, 2024 7.48%
1
7.48%
1
Vivendi SE
2
December 10, 2024 14.59%
3
53.26%
3
4
Concerto Partners LLC June 30, 2023 19.92%
5
48.33%
4
5
V. Bolloré September 22, 2021 18.01%
6
48.04%
4
6
1 Held in large part via various Pershing Square funds.
2 On December 10, 2024, Vivendi SE also notified a short position of 4.65% as a result of its entry into a forward sale.
3 Of which 4.65% represents a potential capital interest and potential voting rights which Vivendi SE notified on December
10, 2024 as a result of its entry into an equity swap.
4 Each of Vivendi SE, Concerto Partners LLC and V. Bolloré has notified an aggregated percentage of voting rights in the
Company based on a voting agreement included in the Relationship Agreement.
5 Held via Scherzo Investment B.V. and Concerto Investment B.V.
6 Held via Bolloré Participations SE, Omnium Bolloré, Financière V, Sofibol, Compagnie de l’Odet and Bolloré SE.
It is possible that the stated percentages of capital interest and/or voting rights differ from the actual
percentages of capital interest and/or voting rights as the Shareholders may only be required to
notify the AFM in the event that their percentage of capital interest and/or voting rights reaches,
exceeds or falls below one of the thresholds.
In the Relationship Agreement, the parties have agreed to, among others, consult with one another
prior to each General Meeting in order to form and exercise, to the extent possible, a common view
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and vote in respect of the various items related to the subjects included in and the obligations of
the parties under the Relationship Agreement, including in respect of the dividend policy as set
out under "Dividend policy". Accordingly, the parties are considered to have concluded a voting
agreement and have therefore aggregated their voting rights in the Company as set out in note 4 to
the table above.
Change in control
The Company’s €2 billion revolving credit facility agreement (potentially) entitles each bank to claim
early repayment of the amounts borrowed by it to the Company in the event of a change in control
over the Company (as defined in the €2 billion revolving credit facility agreement).
In addition, (i) the final terms of the ¥7 billion 1.61% senior notes due July 5, 2038, (ii) the final terms
of the €750 million 4.00% senior notes due June 13, 2031, (iii) the final terms of the €500 million
3.00% senior notes due June 30, 2027, and (iv) the final terms of the €500 million 3.75% senior notes
due June 30, 2032 each entitled a holder of a note to require the Company to redeem or, at the
Company’s option, purchase such note at such note’s nominal amount together with (an amount
equal to) accrued interest in the event of a change in control over the Company (as defined in the
terms and conditions of the notes).
As set out in the Remuneration Report under under ”Severance payments and termination
provisions--Sir Lucian Grainge”, Sir Lucian Grainge is entitled to severance payments in the event
of termination of his employment agreement by Sir Lucian Grainge for good reason, which includes
a change in control (as defined in the Remuneration Report under under ”Severance payments and
termination provisions--Sir Lucian Grainge”).
2022 UMG Global Equity Plan
On May 12, 2022, the General Meeting approved the 2022 Universal Music Group Global Equity Plan
(the 2022 UMG Global Equity Plan) as well as the issuance of Shares or the granting of rights to
subscribe for Shares in order to give effect to awards granted under the 2022 UMG Global Equity Plan
to employees of the Company and its subsidiaries and to Executive Directors up to a total amount
of 5% of the issued share capital of the Company as at May 12, 2022 (the Share Pool) and, to the
extent necessary, the exclusion of the statutory pre-emptive right with respect to such Shares or
rights to subscribe for Shares. On May 16, 2024, the General Meeting further approved the issuance
of Shares or the granting of rights to subscribe for Shares in order to give effect to the granting of
a fixed Euro amount of awards to Non-Executive Directors under the remuneration policy for the
Non-Executive Directors from the same Share Pool and for the same five-year period calculated as
from May 12, 2022, and to the extent necessary, the exclusion of the statutory pre-emptive right with
respect to such Shares or rights to subscribe for Shares. The actual number of Shares to be issued
or rights to subscribe for Shares to be granted in order to give effect to awards granted under the
2022 UMG Global Equity Plan is determinable by the Board (or a committee of the Board designated
for such purpose). The 2022 UMG Global Equity Plan is available on the investor relations part of the
UMG website.
The purpose of the 2022 UMG Global Equity Plan is to provide long-term incentives to employees
of the Company and its subsidiaries and to Directors which are linked to value creation for
Shareholders and, where appropriate, the achievement of certain long-term strategic and financial
goals through a variety of awards designed to attract, retain and motivate the best possible
workforce. In addition, the 2022 UMG Global Equity Plan aims to afford employees of the
Company and its subsidiaries and Directors the opportunity to acquire and maintain ownership
of Shares, thereby strengthening and aligning their concern for the interests of the Company and
its stakeholders.
In Note 24 ‘Share-based compensation plans’ to the consolidated financial statements, details of the
various awards are set out.
Dividend policy
The distribution of profits shall be made after the adoption of the financial statements by the
General Meeting from which it appears that the distribution is allowed. The Company may only make
distributions to the extent the shareholders’ equity of the Company exceeds the sum of the paid-up
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and called-up part of the share capital of the Company and any reserves that must be maintained
pursuant to Dutch law.
In accordance with the Relationship Agreement, and subject to all applicable laws, the Company
intends to, on an annual basis, pay dividends to all Shareholders, on a
pro rata
basis in two semi-
annual instalments, in the aggregate amount of no less than 50% of the Company’s net profits,
subject to agreed non-cash items, calculated as follows:
■
consolidated net profits of the most recent audited consolidated financial statements as of
December 31 prepared in accordance with EU IFRS;
plus
■
(a) any loss arising on any change in fair value of any intangible assets, tangible assets
or financial assets, (b) any amortization or impairment of intangible assets, (c) share-based
compensation expenses, (d) net losses related to non-consolidated companies consolidated
under the equity method, (e) net losses related to minority interests, (f) net provisions for
inventories and (g) any unrealized loss related to derivative financial instruments;
minus
■
(h) any gain arising on any change in fair value of any intangible assets, tangible assets or
financial assets, (i) any unrealized gain related to derivative financial instruments, (j) income
or reversal related to share-based compensation, (k) net profits related to non-consolidated
companies consolidated under the equity method and (l) net profits related to minority interests.
The Company intends to pay an interim dividend in the fourth quarter of each financial year after
the publication of the semi-Annual Report, and a final dividend in the second quarter of the following
financial year following adoption of the financial statements by the General Meeting.
On June 11, 2024, the Company paid a final dividend of €0.27 per Share, bringing the total dividend for
the financial year 2023 to €0.51 per Share.
On October 25, 2024, the Company paid an interim dividend of €0.24 per Share, and the Board now
proposes that on June 13, 2025, the Company pays a final dividend of €0.28 per Share, such proposal
to be approved at the annual General Meeting to be held on May 14, 2025. If approved, this would
bring the total dividend for the financial year 2024 to €0.52 per Share.
Capital events
Credit ratings
On May 31, 2022, the Company was assigned a Baa1 long-term credit rating and a Prime-2 short-term
credit rating, with stable outlook, by Moody’s. On May 29, 2024, the Company was assigned a BBB+
long-term credit rating, and on May 31, 2022, the Company was assigned an A-2 short-term credit
rating, with stable outlook, by S&P.
Euro Medium Term Note program
On July 5, 2023, the Company issued ¥7 billion 1.61% senior notes due July 5, 2038, on June 13, 2023,
the Company issued €750 million of 4.00% senior notes due June 13, 2031, and on June 30, 2022,
the Company issued €500 million of 3.00% senior notes due June 30, 2027 as well as €500 million
of 3.75% senior notes due June 30, 2032 under its Euro Medium Term Note program. The notes are
admitted to trading on Euronext Amsterdam. The proceeds have been used for the refinancing of
indebtedness and payment of transaction fees and expenses.
Negotiable European Commercial Paper program
On June 3, 2024, the Company extended its Negotiable European Commercial Paper program and
increased the amount thereof from €1 billion to €2 billion. The Company uses its Negotiable
European Commercial Paper program for the financing of general corporate purposes.
Investor Relations
UMG is committed to maintaining an open and constructive dialogue with Shareholders (including
potential Shareholders and other investors) and aims to keep Shareholders updated by informing
them clearly, accurately and in a timely manner about its strategy, performance and other matters
and developments that could be relevant to their investment decisions.
Capital Markets Day
The Company held its Capital Markets Day on September 17, 2024 at the Abbey Road Studios
in London. During this event, senior executives from across the Company presented a strategic
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update and business outlook, and management shared medium-term financial targets for revenue,
subscription revenue and adjusted EBITDA growth through the end of the financial year 2028.
Shares
On September 21, 2021, the Shares were admitted to listing and trading on Euronext Amsterdam
(ticker symbol: UMG). The Shares are included in a number of indices, including the AEX, which is
a free float market capitalization weighted index that reflects the performance of the twenty-five
largest and most actively traded shares listed on Euronext Amsterdam. At year-end 2024, the share
price was € 24.72 and the market capitalization was € 45.2 billion. The average daily trading volume in
2024 was €33.1 million or 1.3 million Shares.
Share price information 2024
Market capitalization at year-end (€ billion) 45.2
Lowest closing price (July 27, 2024, €) 21.12
Highest closing price ( May 8, 2024, €) 29.42
Closing price year-end (€) 24.72
Total shareholder return -0.4%
Average daily trading volume on Euronext Amsterdam (shares) 1.3 million
January 2024 April
July
December
30
25
20
15
10
5
0
Per share data 2024
Dividend (€): 0.24 interim + 0.28 proposed final 0.52
EPS - basic (€) 1.14
EPS - diluted (€) 1.13
Adjusted EPS - basic (€) 0.98
Adjusted EPS - diluted (€) 0.96
Contact
Further information on UMG is available from the Investor Relations department, which can
be reached by telephone: +31 35 799 4200 or by email: [email protected]. Further
shareholder information is available on the investor relations part of the UMG website:
https://investors.universalmusic.com.
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RISK AND RISK MANAGEMENT
UMG has a diverse portfolio of brands, music labels, artists, established (predictable) and developing
businesses, all spread across different geographies and business structures. Whilst this level of
diversification generally spreads risk across our business, it is critically important that the Company
manages risks in a proactive and responsible way to ensure we can deliver on our multi-faceted
growth strategies.
The Company’s risk management is designed to provide reasonable assurance that strategic and
operational objectives are met, legal requirements are complied with, and the integrity of the
Company’s financial reporting and related disclosures is safeguarded. However, there can be no
absolute assurance that our risk management will avoid or mitigate all risks that UMG faces. The
material risks are described in Risk Factors.
Risk appetite
The Board and management seek to manage risks consistently within the risk appetite. UMG’s risk
appetite differs depending on the type of risk, ranging from averse to a seeking approach. We believe
we must operate within the dynamics of the music industry and take risks needed to ensure we
continually revitalize our offerings for our artists and the way we work. At the same time, UMG
attaches prime importance to integrity, sustainability and compliance with laws and regulations.
Risk appetite for the four main risk categories is visualized below.
UMG does not classify these risks in order of importance.
Averse
Very lowRisk appetite
Behavior towards risk
Low Medium High Very high
Prudent Balanced Considerable Seeking
Strategic
e.g. Competition, Streaming & Subscription
adoption. Reliance on DSP’s, Piracy
Operational
e.g. Attract & retain talent, Cybersecurity,
Geopolitical instability & economic downturn
Financial
e.g. Access to financing, Change in Tax Laws
Compliance (Laws & Regulations)
e.g. Intellectual Property, Data Protection,
Government regulations, Changes in laws &
regulations
Governance, Risk and Compliance
The Company has an Internal Control Framework (ICF) modelled upon the COSO (Committee of
Sponsoring of the Treadway Commission) 2013 framework. The ICF incorporates risk assessment,
control activities and monitoring into our business practices at entity wide and functional levels.
For the organization of risk management and internal control systems, we have adopted a ‘Three
lines of defense’ model (see chart below) to provide reasonable assurance that risks to achieving
important objectives are identified and managed. To enhance and coordinate risk assurance across
the company, a Governance, Risk and Compliance working group has been established in 2022 that
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has continued to meet on a periodic basis since inception to review and monitor UMG's risk and
control environment.
Monitoring and Assurance
A key element of our ICF is monitoring and assurance. The Company uses a comprehensive
business planning and performance review process to monitor the Company’s performance. This
process covers the adoption of strategy, budgeting and the reporting of current and projected
results. The company assesses business performance according to both financial and non-financial
(including sustainability) targets.
All our businesses are required to maintain and manage a sound internal control environment with
robust policies, procedures and controls and strong financial discipline.
In order to meet business needs and the requirements of the Dutch Corporate Governance Code,
the Company has a Group-wide management certification process in place, which requires that
the designated executive management team member at each of the reporting entities send
attestation letters on a periodic basis to both the Corporate Financial Reporting Group (quarterly)
and the Controls Assurance Function (semi-annually). Summarized, these letters confirm whether
the reporting entities have incorporated the ICF in the local control policies and procedures and
where deficiencies, non-adherence or breaches to the controls and/or procedures were found, that
these have been reported and that the necessary remedial action has been undertaken to ensure
that the internal control systems remain effective.
Both the Controls Assurance and Internal Audit functions help to ensure that the Company
maintains and improves the integrity and effectiveness of the system of risk management and
internal control.
The ICF is being monitored by the second line of defense Controls Assurance function through
controls testing and other monitoring activities. Internal Audit undertakes regular risk-based audits
in accordance with the audit plan as approved by the UMG Audit Committee.
Continuous ICF Improvements
Management continues to invest in the further improvement of the risk and internal control systems
in the Company. Through upgrading its systems (including computer hardware infrastructure),
adding additional financial and management controls as well as enhancing reporting systems and
procedures. Management will continue to make further improvements in 2025, which will be aimed
at, amongst other things:
■
Enhancing program management controls for companywide IT system implementations.
■
Optimizing the risk and control framework related to non-financial reporting (i.e. ESG).
■
Deploying initiatives aimed at standardizing and automating processes and controls.
■
Optimizing the level of monitoring of the risk and control systems, including enterprise risk
management and a coordinated risk assurance process.
■
Continue improving the quality and in particular the level of documentation of key controls across
primary business processes.
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Compliance and Integrity
As the world’s leading music company, UMG recognizes that we have a responsibility to lead by
example and ensure that all of our actions and decisions are based on honesty and integrity.
UMG’s global Code of Conduct sets our foundation that how we conduct business is as important
as our results. The Code of Conduct outlines the key responsibilities for all our employees, officers,
members of the board of directors, and (where permitted) third party consultants and advisors or
representatives and requires:
■
Honesty in all of our actions and decisions.
■
Treating everyone with respect.
■
Following the law and UMG policies when conducting company business.
■
Seeking guidance when we are not certain about the right thing to do.
■
Speaking up when we see a problem.
We meet these requirements by focusing on four key principles:
1.
SETTING THE RIGHT TONE WITH OUR PEOPLE by valuing a diverse workforce; promoting a
respectful, safe and healthy workplace; and by protecting human rights.
2.
SETTING THE RIGHT TONE FOR OUR COMPANY by properly disclosing or avoiding any conflicts of
interests and monitoring the receipt of gifts.
3.
SETTING THE RIGHT TONE IN THE MARKETPLACE by following laws and regulations related to
bribery and corruption; marketing and advertising; fair purchase practices and international
trade regulations.
4.
SETTING THE RIGHT TONE IN OUR COMMUNITIES by protecting the environment and contributing
to our communities.
The Code of Conduct provides all employees a road map of how to make ethical choices and how
to comply with our legal and regulatory obligations. Most importantly, it provides guidance on when
and where to seek guidance or to report a potential compliance breach. All UMG employees are
trained on the Code of Conduct annually and must certify compliance with the Code of Conduct
on an annual basis. The Code of Conduct is available in the investor relations section of UMG’s
public website.
Our compliance obligations are overseen by our Compliance department as well as our Control
Assurance department, Internal Audit department and our Finance department. An internal control
framework, including policies, procedures and financial discipline underpins our risk management.
Corruption and Bribery
UMG is committed to complying with all applicable laws in each of the countries in which we operate,
including compliance with laws relating to anti-corruption and bribery. UMG does not tolerate any
form of corruption or bribery within its organization. Non-compliance with laws and regulations,
including anti-corruption, bribery and related laws could expose the Group to legal liability and
may negatively impact the Company’s reputation, financial position, results of operations and/or
prospects. These risks may manifest themselves in interactions with government bodies, trade
associations, and in the merchandising division.
The Company has implemented a number of measures to counter the aforementioned risks. UMG’s
stance against, and prohibition of, corruption and bribery is covered not only in its Code of Conduct
but also in its global stand- alone anti-corruption and lobbying policy, which applies globally to
all of UMG’s employees and its directors. In addition to the annual Code of Conduct training, all
employees in all UMG territories are periodically expected to complete training specifically on the
topic of anti-corruption.
UMG’s anti-corruption compliance program provides risk mitigation guidance on matters including,
but not limited to: interactions with government officials; conflicts of interest; political contributions/
lobbying activities/charitable giving; gifts/travel and entertainment; and proper maintenance of
books and records. Employees are offered a multitude of ways to raise any concerns of anti-
corruption and bribery, including dedicated reporting channels for conflicts of interest and gifts/
hospitality, in addition to the option to use UMG’s dedicated whistleblower reporting line or by
making direct reports to supervisors, the General Counsel, or the Chief Compliance Officer.
Where relevant, UMG will take appropriate action in response to any allegations or reports of
misconduct, including investigations, disciplinary action and/or criminal or civil procedures. The
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compliance department and internal audit department regularly monitor the effectiveness of the
company’s anti- corruption and bribery compliance program. UMG has a dedicated ethics committee
to ensure compliance with the Code. The Chief Compliance Officer provides regular reports to
the ethics committee of any material potential violations of the Code, including anti-corruption
and bribery, the status of any investigations, and the outcome of any investigations. The ethics
committee and the internal audit department will further notify the audit committee of
the Board and the Board, itself, as required, depending on the circumstances of the potential
violation. In 2024, no reports were received related to bribery or corruption and there were no known
instances of bribery or corruption.
Fraud Risk
The Company maintains a global fraud risk register that summarizes risks and compensating
measures. The global fraud risk assessment is an annual process and was performed in the last
quarter of 2024.
The Company’s stance with regard to integrity is clearly outlined in its Code of Conduct, as also
explained in this Risk Management chapter. Any incidents of fraud and theft within the Company
will be promptly investigated, reported and, where appropriate, lead to disciplinary actions (from
warnings to immediate terminations). In addition, we carry out in-depth investigations of (possible)
fraud cases, which may lead to an intermediate update of the fraud risk assessment.
Whistleblowing Policy and Reporting
UMG’s Code of Conduct and our standalone Whistleblowing Policy (which can also be found in the
investor relations section of UMG’s public website: https://investors.universalmusic.com/governance)
provide numerous options for employees to seek guidance and report potential breaches of the
Code of Conduct, including contacting the company’s Chief Compliance Officer or General Counsel
directly. Additionally, UMG provides a global reporting line, through a third-party provider. The global
compliance and ethics hotline is available 24 hours a day, seven days a week via telephone or
the internet. Reports can be made in all the languages in which we do business and may be
made anonymously in those jurisdictions which permit anonymous reporting. The whistleblower
hotline is available not only to UMG employees but third parties as well. Reports are maintained as
confidentially as possible (or fully confidentially as may be required by law) and are investigated.
In 2024, there were no substantiated reports of significant financial reporting, accounting, fraud or
ethical (including human rights) violations.
Additionally, the Compliance Department maintains and monitors email boxes dedicated to reporting
potential conflicts of interest.
Prohibition Against Retaliation
In order to encourage reporting of potential breaches of the Code of Conduct or other company
policies, we prohibit retaliation of any kind against anyone who makes a complaint or report of a
potential violation of law or policy in good faith. Engaging in retaliation is itself a violation of our Code
and may result in disciplinary action, up to and including termination of employment.
Risk factors
UMG’s business and the industry in which it operates, are subject to a number of risks. UMG believes
that the risk factors as set out below, are the key risks and uncertainties concerning UMG’s business
and industry, and that, alone or in combination with other events or circumstances, could have a
material adverse effect on UMG’s business, results and financial position.
In making this selection, UMG has considered circumstances such as the probability of the
risk materializing on the basis of the current state of affairs, the potential impact which the
materialization of the risk could have on the Group’s business, results and financial position, and
the attention that management would, on the basis of current expectations, have to devote to these
risks if they were to materialize.
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While UMG believes that the risks and uncertainties described below are the key material risks and
uncertainties concerning its business and industry, they are not the only risks and uncertainties
relating to UMG.
Other risks, events, facts or circumstances not presently known to UMG, or that UMG currently
deems to be immaterial could, individually or cumulatively, prove to be important and may have
a significant negative impact on its business, results and financial position. The risk factors below
have been divided into categories; however, some risk factors appear in more than one category.
Risk Likelihood Impact
Challenge to attract, sign and retain successful artists a in a highly competitive and evolving industry High Moderate
Decline in streaming revenue, subscription adoption and digital marketshare Moderate Moderate
Digital service provider dependency Moderate Moderate
Competition in evolving markets High Moderate
Inability to timely adapt to trends and developments in the markets in which UMG operates Moderate Low
Content protection and piracy High High
Generative AI High High
Challenge to attract and retain internal talent Moderate Moderate
Cybersecurity High High
Changes in global economic and financial conditions High Moderate
Geopolitical Instability High Moderate
Dependency on information technology systems Moderate Moderate
Restructuring and reorganization Moderate Moderate
Acquisitions and other investments Low Moderate
Access to and cost of financing Low Low
Currency fluctuations Moderate Low
Changes in tax laws Moderate Moderate
Loss of intellectual property rights Low High
Data protection compliance Moderate High
Governmental and regulatory challenges High Moderate
Changes in laws and regulations Moderate High
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For each of the risks set out below, UMG has indicated examples of the programs, processes and
controls which are designed to help manage and mitigate the risks. These risk responses are
designed to manage risks towards, and should be read in conjunction with, the Risk Appetite as
described above.
It is however possible that these initiatives may not be successful in limiting fully or partly the
occurrence and impact of the risks on UMG's business, results and financial position.
Strategic risks
Challenge to attract, sign and retain successful artists in a highly competitive and evolving industry.
UMG may be unable to compete successfully in the highly competitive industry and markets in
which it operates and UMG’s business may be adversely affected if UMG fails to identify, attract, sign
and retain successful recording artists and songwriters or by the absence of superstar releases.
The industry in which UMG operates is highly competitive, influenced by consumer preferences
and rapidly evolving. UMG’s competitive position is dependent on identifying, attracting, signing and
retaining recording artists and songwriters who are or will become commercially successful, who
have long-term potential, whose music is well received, whose subsequent music is demanded by
consumers and whose music will continue to generate sales as part of its catalog for years to come.
UMG is also dependent on signing and retaining songwriters who are capable of writing songs
that will be the popular hits of today and the classics of tomorrow. UMG’s competitive position is
dependent on its continuing ability to attract and develop such recording artists and songwriters
whose work can achieve a high degree of popularity and thereafter continue to create music and
songs to retain, engage and expand their fan base.
UMG uses external sources of data provided by streaming platforms or other external providers.
Limitations to access of such data could adversely impact UMG’s capability of identifying future
talents and therefore negatively affect its business. While UMG is required to devote significant
time and investment to signing, retaining and developing artists, the returns on these activities
are influenced by a number of factors, including factors outside of the control of UMG, and are
uncertain at the time of investment. To the extent that the expected returns from these activities
fail to materialize or are not in line with expectations, this may negatively impact UMG’s results and
financial position.
UMG’s competitors may become more successful at signing, marketing and promoting recording
artists, for example if UMG’s competitors increase the amounts they spend to discover, or to market
and promote, recording artists and songwriters or reduce the prices of their music in an effort to
expand market share, which may adversely impact UMG’s business, results and financial position.
UMG’s recorded music business is to a large extent dependent on rapid and significant technological
developments in order to remain competitive, including access to, selection and viability of new
technologies, and UMG’s recorded music business is subject to potential pressure from competitors
as a result of technological developments modifying the nature of UMG’s competition.
UMG also faces competition from traditional music industry players as well as new entrants,
including investment funds whose investment thesis includes making acquisitions of collections
of musical compositions, or “catalog acquisitions”.
In addition, changing business practices, particularly due to the emergence of new technologies and
access to a global network of consumers, has and could further result in artists choosing to make
content available to consumers directly without being affiliated with a label or an intermediary, or
could result in music services playing some of the roles that UMG has traditionally played. In this
regard, UMG also competes with certain of the music distribution platforms who distribute the works
of artists and songwriters without the involvement of labels or intermediaries.
Adapting to, and competing with, rapid technological advancements require substantial investment
of time and resources; however, such investment does not guarantee UMG’s success in developing,
implementing, transitioning to, competing with, utilizing or defending against new technology. Any
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failure by UMG to accurately anticipate customers’ changing needs and emerging technological
trends could significantly harm UMG’s competitive position and results of operations.
Furthermore, if UMG fails to keep pace with rapidly evolving technological developments in artificial
intelligence, its competitive position and business results may suffer. UMG’s competitors or other
third parties may incorporate artificial intelligence in a similar or different manner and may do so
more quickly or more successfully than UMG.
Risk response
With regard to the development of recording artists and songwriters, UMG believes that traditional,
high-touch, full-service label deals with its portfolio of world- renowned labels provide the most
long-term value to an artist and greatly increase the commercial success, consumer base and
longevity potential for artists at every stage of their careers. These deals provide for the full suite of
professional expertise and global resources of a major label, including a comprehensive approach
to content creation, organic artist development, timing, marketing, promotion, financial investment,
and forward planning.
UMG is pioneering partnerships with new platforms, continuing the decades-long fight for copyright
protections all around the world while combatting piracy in its many forms and creating commercial
environments for artists in countries where commerce in music was basically non-existent; UMG
continues investing in the next generation of creative leaders.
UMG has consistently demonstrated the value it represents to an artist’s success. Producing and
marketing music successfully requires significant upfront investment and involves collaborating
with the best writers and producers. UMG invests more money and expertise through its staff of
industry specialists than any other recorded music company in signing and developing talent.
Combining these investments and expertise with UMG’s excellence in marketing and in promoting
artists globally, enables UMG to consistently lead the industry in breaking artists.
With respect to technological advancements as it relates to AI, UMG collaborates with responsible
and ethical AI thought leadership and pursues the establishment of legislative and regulatory
“guardrails” for AI. We are vigorously advocating for public policies furthering Responsible AI with
governments around the globe, including through multi-stakeholder coalitions and trade bodies, as
well as on our own.
UMG’s diverse range of artists and labels helps the business consistently cater to changing
consumer trends. As a result of having such a broad array of artists and labels, UMG is not reliant on
one artist, or on a small number of artists, to generate revenue in any given year.
Decline in streaming revenue and/or subscription adoption and/or digital market share
UMG’s business may be adversely affected should streaming and subscription adoption revenue or
UMG’s digital market share fail to grow or grow less rapidly than UMG anticipates.
Revenues from subscription music services are important to UMG because they represent a
significant area of UMG’s recorded music business and offset declines in downloads and physical
sales. In 2024, UMG generated €6,038 million of revenue from subscription music services and ad-
supported streaming, as compared to €5,700 million in 2023.
Consumption formats in the music industry are susceptible to technological advancements and
changing consumer preferences around how music is accessed, as illustrated in recent years by
the global decline in revenue derived from CD sales, and subsequently downloads. Technological
developments, and other factors, may in the future negatively impact streaming or otherwise disrupt,
the music industry.
Vast quantities of uploads with no meaningful engagement, including non-artist noise content
delivered daily to digital platforms (including via the use of generative AI) increase the challenges
for marketing music to fans and policing infringements. Additionally, technology around streaming
manipulation, fraud and hacking is becoming increasingly refined and subscription streaming
services are vulnerable which could undermine consumer confidence and cause revenue loss.
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If UMG’s subscription or streaming revenue or UMG’s digital market share fail to grow, grow
less rapidly than it has over the past several years or declines, UMG’s recorded music business
may experience reduced levels of revenue and operating income. Additionally, slower growth in
streaming adoption or revenue is also likely to have a negative impact on UMG’s music publishing
business, which generates a significant portion of its revenue from sales and other uses of
recorded music.
Risk response
UMG continues to actively and successfully work with existing and new streaming and subscription
partners (global, regional and local) to develop existing and create new revenue streams. UMG also
spearheaded the re-imagining of the subscription streaming model, encouraging digital partners to
tackle streaming manipulation and fraud, and to evolve the revenue model to reward real artists
that drive engagement and retention on streaming platforms. UMG plays an active role in promoting
the continued development of new digital services and consumer offerings in order to support a
competitive, healthy and increasingly global market, as well as in developing and growing new
categories for exploitation of digital music, including fitness and wellness. UMG has agreements
with several hundred global, regional and local digital service providers around the world, growing
legal consumption of music and legitimate commercial outlets in markets with high levels of
piracy, including the high-growth countries Brazil, India, China, Latin America, Africa, the Middle
East, Eastern Europe and Southeast Asia. These services have made music more accessible to fans,
offering a free-to-use option for consumers as an alternative to pirated content, with additional
upsell opportunities created.
The result of UMG’s leadership position, as well as its willingness to embrace new business
partners and spearhead the development of new business models around the world, has resulted
in an expanded market for music consumption and monetization, benefiting artists, fans, platform
partners and music companies.
Digital service provider dependency
UMG relies on digital service providers for the online distribution and marketing of its music on the
basis of contractual terms that are subject to change.
UMG derives increasing revenues from the distribution of music through digital distribution
channels and partners with several hundred music services around the world. In 2024, the top 50
music services accounted for 98% of UMG’s recorded music digital revenue, as compared to 98% in
2023. In 2024, 70% of UMG’s recorded music revenue was derived from digital channels, as compared
to 70% in 2023.
UMG currently enters into relatively short-term agreements with digital music streaming services
in order to allow flexibility and enable adaptation to the rapidly evolving market. There can be
no assurance that UMG will be able to renew agreements on the same terms or enter into new
agreements with any digital music service. The terms of these agreements, including the rates that
UMG receives pursuant to them and the basis for calculation of those rates, may change as a result
of changes in the industry or changes in the law, or for other reasons. Decreases in rates or changes
to other terms of agreements with digital music streaming services, or the inability to come to terms
with services leading to removal of our music, could adversely impact UMG’s business, prospects,
financial condition and results of operations.
UMG’s music is also promoted by the digital music services on playlists curated by such services or
generated from their algorithms (or a combination of both). Any unfavorable changes made by such
service providers to their algorithms or to the terms on which they market or promote UMG’s music
could adversely affect UMG’s revenues, operating results and financial position.
Risk response
While a number of digital service providers compete with each other in the music industry around
the world, they all seek to work closely with UMG, the largest supplier of content to all of the digital
service providers. This is because UMG’s artist content is a key driver of customer acquisition and
retention for all of these platforms. UMG’s world-renowned catalog, which is continuously growing
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through UMG’s proven ability to develop and break new artists, makes UMG an important partner
for platforms. The introduction of new products, services and revenue streams across segments
spanning voice, fitness, wellness, social media, gaming, live streaming, brand partnerships, start-
ups and other categories helps to further mitigate the reliance on a limited number of digital
service providers.
Competition in evolving markets
UMG may be unable to compete successfully in the evolving markets in which it operates or unable
to execute its business strategy.
UMG expects to increase revenues and cash flow through a business strategy which requires,
among other things, continuing to maximize the long-term value of its music by expanding the
licensing partners with which UMG works. UMG’s strategy also includes continued diversification
of its revenue streams by partnering with an increasing array of new businesses that benefit from
the use of music content to engage consumers, including fitness and video games, and through
business arrangements with non-traditional partners, including social media platforms.
UMG has also in the past completed and, as part of its business strategy, will continue, from time
to time, to grow revenues and cash flow through strategic transactions, including acquisition(s)
of business(es) in high potential markets, other acquisitions, combinations or dispositions of
businesses or assets, or strategic alliances or joint ventures with companies engaged in music
entertainment, investing or other businesses. See the “Acquisitions and other investments” risk
factor for more information on perceived risks associated with acquisitions as well as UMG’s
risk response.
UMG may incur significant costs deploying its business strategy, and there can be no assurance that
UMG will be successful in addressing risks or problems encountered in connection with strategic
transactions or will be capable of executing or furthering its business plans during economic
downturns, and UMG may not be able to recoup investments it has made in developing its business
activities. UMG faces competition from traditional music industry players as well as new entrants
and may not be able to execute its business strategy because of a failure to promote innovative
products and/or to keep pace with market evolutions and, as a result, may lose market share to
existing or new competitors.
Furthermore, the success of UMG’s initiatives relies on adequate third-party support and requires
UMG to accurately forecast and keep up with technological developments and consumer preferences
relating to platforms and may require UMG to implement new business models or adapt to new
distribution platforms. If UMG is unable to implement its strategy successfully or properly react to
changes in consumer preference, then its financial condition, results of operations and cash flows
could be adversely affected.
Risk response
UMG is a key promotor of innovation across the digital ecosystem through partnerships in new
product categories and through proactive efforts to cause its partners to evolve and innovate.
UMG maximizes opportunities to introduce new products, services and revenue streams in
various segments spanning voice, fitness, wellness, social media gaming, live streaming, brand
partnerships, start-ups and other categories. As discussed above, UMG also spearheaded the re-
imagining of the subscription streaming model.
Inability to timely adapt to trends and developments in the markets in which UMG operates
UMG operates in many jurisdictions around the world and therefore is subject to a variety of trends,
developments and limitations in those jurisdictions, which could affect it adversely.
UMG has offices engaged in recorded music, music publishing, merchandising and audiovisual
content in more than 60 territories around the world. UMG’s local presences have become
increasingly important as the popularity of music originating from a country’s own language and
culture is very significant, and more countries around the world have developed legitimate business
models to monetize music. In addition, UMG’s business model is increasingly focused on developing
business in new high-potential music markets. For example, in 2024, we strengthened our global
presence through new activities, acquisitions, label launches and key partnerships in Nigeria and
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Thailand. However, if UMG’s music does not continue to have appeal in various countries, UMG’s
results of operations could be adversely impacted and its investments in new jurisdictions could fail
to generate returns for UMG in line with expectations. Additionally, UMG may not be successful in
identifying and signing the most promising artists in these markets, which may negatively impact
UMG’s competitive position in these geographies, its prospects and its ability to generate returns in
these markets.
In countries in which UMG currently conducts, or may in the future conduct, its businesses,
UMG’s operations, growth strategy and development may be negatively impacted as a result of less
developed digital, internet and mobile network infrastructure. UMG’s success, particularly streaming
revenues, depend on the continued development and use of internet by consumers to access
music as well as increasing high-speed internet and smartphone penetration. If internet access or
smartphone penetration in these markets develops slower than expected, or is stalled, UMG’s growth
strategy could be adversely affected.
Further, depending on the customs and norms in various markets, UMG’s presence in and
generation of revenues from other countries may require UMG to accept longer accounts receivable
settlement cycles and may subject UMG to difficulties in collecting its accounts receivables.
Risk response
UMG is committed to shaping culture through artistry and is responsive to the needs and ambitions
of local talent. In 2024, 62% of UMG’s physical & digital recorded music revenues came from local
repertoires in their own countries, as compared to 62% in 2023. Prior to entering a new market, UMG
teams carefully identify areas of risk and develop a business case and strategic plan.
Content protection and piracy
Piracy continues to adversely impact UMG’s business and content protection is a key focus of
UMG’s business.
Technological advances and the conversion of music into digital formats have made it easy to
create, transmit and distribute high-quality unauthorized copies of music in a manner that does not
provide an economic return for UMG or its artists and songwriters.
Streaming fraud involves the creation of artificial ‘plays’ on digital music streaming services that do
not represent genuine listening. This activity constitutes fraud and damages the fan experience,
distorting charts and playlists. The impact of streaming fraud and piracy on legitimate music
revenues and subscriptions is hard to quantify, but UMG believes that illegal file sharing and other
forms of unauthorized activity, including stream manipulation, have a substantial negative impact
on music revenues.
IFPI conducted one of the largest music consumer studies in the world with over 43,000 music fans
across 26 countries, where authorisation for the use of music was seen as extremely important; 76%
felt that an artist’s work should not be used without their permission and 73% agreed that an AI
system should clearly list the music it has used.
If UMG is not successful in its content protection efforts, its business, results of operations, financial
condition and prospects may suffer.
Risk response
UMG invests significant resources in combatting the many forms of piracy of its music
including through litigation, lobbying and interdiction. UMG also encourages its digital partners to
support UMG’s content protection efforts by taking direct action against unauthorized activity on
their platforms.
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Generative AI
While UMG embraces responsible and innovative artificial intelligence and is optimistic about the
potential benefits and opportunities brought by AI, technology to create AI-generated music and
images has introduced new challenges for the protection of intellectual property and artist rights.
The unauthorised reproduction of copyrighted works to train AI technology that creates AI-generated
content infringes intellectual property rights and embodies unauthorised and/or fraudulent
renditions of artist voices, images and likenesses. Such infringing AI-generated content, unlicensed
training on UMG’s catalog of copyright-protected artists content, and fraud could create vast
quantities of new musical works to compete with and dilute the impact of UMG’s copyright-protected
material on digital music services, which could adversely affect UMG’s results.
UMG believes that AI can be used to enhance human creativity in music, enriching aspects of what
UMG does for artists and their fans. For that reason, UMG has been exploring the opportunities
emerging from this technology for many years, applying AI for advances in data analytics, marketing
tools, enhanced studio and audio production, while working to protect the long-term value of
artistic content. If UMG fails to keep pace with rapidly evolving technological developments in AI,
its competitive position and business results may suffer. In addition, UMG’s competitors or other
third parties may incorporate artificial intelligence in a similar or different manner and may do so
more quickly or more successfully than UMG.
Risk response
UMG has articulated the importance of establishing effective tools, incentives and rewards that
enable us to limit AI’s potential downside while promoting its promising upside. UMG supports the
Human Artistry Campaign (‘HAC’) and its principles – the HAC is a global initiative formed in early
2023 to protect creators’ rights in the age of AI, with more than 170 supporting organizations from
40+ countries.
In addition to responsible and ethical AI industry collaborations and thought leadership, UMG
is pursuing the establishment of legislative and regulatory “guardrails” for AI, including backing
legislation that, if enacted, would establish a federal right of publicity in the United States to
help protect Americans’ image, likeness and voice – and helping to prevent deepfakes. We are
vigorously advocating for public policies furthering Responsible AI with governments around the
globe, including through multi-stakeholder coalitions and trade bodies, as well as on our own.
In addition, we are protecting creators’ rights in the AI environment through litigation. For
example, UMPG, alongside two other music publishers, filed a copyright infringement lawsuit against
Anthropic for its large-scale, wholesale copying of copyrighted lyrics. UMG with other record
companies also filed cases for copyright infringement against two prominent music AI companies,
Suno and Udio.
Operational risks
Challenge to attract and retain internal talent
UMG’s ability to operate effectively could be impaired if it fails to attract and retain its executive
officers and other key personnel.
UMG’s success depends, in part, upon the continuing contributions of its executive officers and
key operational and creative personnel, led by its Chairman and Chief Executive Officer. These
executive officers and key personnel possess significant experience within the music industry
and their established personal connections and relationships in the music industry are important
to the UMG’s operations. UMG competes with other music and entertainment companies, record
labels, digital service providers, technology companies and other companies for top talent, including
executive officers and other key personnel.
If UMG were to unexpectedly lose a member of its key management, its business activities, results of
operations, financial position and prospects could be materially and adversely affected.
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Risk response
UMG is an established brand with both an attractive name and business reputation in the talent
market. UMG has taken proactive and preventative measures to attract and retain talent.
UMG has added more offerings geared towards equitable professional development across UMG’s
diverse employee community. These include tailored programming and resources, such as
renowned guest instructors, and executive coaches to prepare employees for the next level of
their career at UMG. The initiatives are geared towards incentivizing early and mid-career employee
retention, which are the groups most susceptible to risk.
In addition, in 2022, UMG established an Equity Plan to provide long-term incentives to senior
employees which are linked to value creation and designed to attract, retain and motivate the best
possible workforce.
Restructuring and reorganization activities
UMG has engaged in effective restructuring and reorganization activities in the past, is currently
engaged in an Organizational Redesign and may need to implement further restructurings and
reorganizations in the future.
UMG’s business has been, and may continue to be, impacted by significant ongoing changes in
the entertainment industry. In response, it has sought, and will continue to actively seek, to adapt
its operations and cost structure to the changing economics of the industry and to capitalize on
growth opportunities. For example, while physical sales are still significant in some markets, music
consumption has shifted from an ownership model, whereby consumers purchase vinyl or CDs, to an
access model that includes subscription and ad-supported streaming formats.
In February 2024, UMG announced that it is engaged in an organizational redesign of its global
structure, which is expected to enhance UMG’s capabilities in the areas most critical to its future
growth and success while providing its labels with enhanced capabilities to deepen artist and fan
connections via new, experiential, commerce and content offerings (the “Organizational Redesign”).
UMG may also in the future be required to implement further restructuring activities, make additions
or other changes to its management or workforce based on other cost reduction measures or
changes in the markets and industry in which it competes, including the evolving skill sets
required from its employees. UMG’s inability to implement the Organizational Redesign successfully
or to structure its operations based on evolving market conditions could impact its business.
Restructuring activities can also create unanticipated consequences and negative impacts on its
business, and UMG cannot be certain that any ongoing or future restructuring efforts will be
successful or generate expected cost savings.
Risk response
UMG has engaged in effective restructuring and reorganization activities in the past. UMG’s
executives have a broad range of experience that provides the discipline for effective execution of
the restructuring plans.
Acquisitions and other investments
Where UMG acquires, combines with or invests in other businesses or joint ventures, UMG will face
risks inherent in such transactions.
UMG has in the past completed and, as part of its business strategy, will continue, from time
to time, to consider strategic transactions, which could involve acquisitions, combinations or
dispositions of businesses or assets, or strategic alliances or joint ventures with companies engaged
in music entertainment, investing or other businesses. For example, Virgin Music Group, the
global independent music division of UMG, announced in December 2024 that it had entered into
a definitive agreement to acquire Downtown Holdings LLC. The acquisition, which is subject to
regulatory approvals, is expected to close in the second half of 2025. In addition, in 2024, UMG
acquired a stake in (i) Chord Music Partners (“Chord”), pursuant to a long-term strategic partnership
with Chord’s other shareholders to actively manage Chord through UMG’s global network and further
develop its catalogue of music and intellectual property and (ii) NTWRK, a premium live-video
shopping platform and curated marketplace serving buyers and sellers.
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UMG may not be successful in addressing any risks or problems encountered in connection with any
strategic transactions. UMG cannot assure that if it makes any future acquisitions, investments,
strategic alliances or joint ventures or enters into any business combination that they will be
completed in a timely manner, or at all, that they will be structured or financed in a way that
will enhance its creditworthiness or that they will meet its strategic objectives or otherwise be
successful. In addition, if any new business in which UMG invests or which it attempts to develop
does not progress as planned, it may not recover the funds and resources it has expended.
Furthermore, UMG faces risks in successfully integrating any businesses that it might acquire, and
these risks may be magnified by the size and number of transactions executed. Ongoing business
may be disrupted, and management’s attention may be diverted by acquisition, investment,
transition or integration activities. In addition, UMG may need to dedicate additional management
and other resources, and it could be difficult for us to efficiently integrate acquired businesses into
our ongoing operations and assimilate and retain employees of those businesses into UMG’s culture
and operations. The loss of key executives, employees, customers, suppliers, vendors and other
business partners of businesses acquired may adversely impact the value of the assets, operations
or businesses.
Additionally, UMG has made investments into joint ventures with third parties in certain jurisdictions
and it may in the future enter into additional such joint ventures as a means of conducting its
business in various jurisdictions. While UMG seeks to ensure that it has appropriate rights when
entering into joint ventures, in the future other investors in the joint venture may have or require
certain rights under the terms of the joint venture, and therefore, UMG may not be able to unilaterally
make significant decisions or take timely actions with respect to its joint ventures. UMG’s inability to
take decisive unilateral action in respect to its joint ventures could have a material adverse impact
on UMG’s results of operations.
Risk response
UMG has defined pre-acquisition due diligence procedures in place that enables informed decision
making, as well as post-acquisition integration procedures geared towards timely and effective
integration of acquired companies.
Cybersecurity
Cybersecurity presents ongoing risks that could adversely impact UMG’s global data and operations.
UMG’s systems may be vulnerable to damage from cybersecurity attacks.
UMG processes personal data related to customers, employees, business partners, artists, and
vendors. UMG also maintains sensitive confidential business information of itself and, in some
cases, counterparties, as well as intellectual property including rights in music recordings and
compositions that in some cases are not yet released. UMG relies on both its computer systems
and those of its service providers for day-to-day operations and to manage these kinds of critical
business data. No computer system is immune from attacks or other incidents, and UMG’s system
may be vulnerable to, or may have suffered unknown, security breaches by computer hackers
and others that attempt to penetrate or otherwise defeat the security measures that it has in
place. A compromise of its security systems that results in the loss or exposure of personal
data, confidential information, or intellectual property could lead to operational disruptions and
significant expenditures to address the incident. Such a compromise could lead to the loss of
competitively sensitive information, theft of funds, reputational harm, litigation and investigations,
legal expenses, liability, penalties, or the imposition of ongoing monitoring or audit requirements
which may create operational disruptions and/or significant expenditures. Any of the foregoing may
adversely impact UMG’s business, results of operations, financial position, and prospects.
Risk response
UMG employs multiple layers of cybersecurity defenses to protect assets, systems, and employees
from cyberattacks. These controls include broad deployment of advanced authentication controls
including multi-factor authentication, deprecation of privileged service accounts, active network and
system monitoring, centralized logging, and incident response and business continuity planning.
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UMG has further implemented controls to enhance remote access security, augment visibility
to network behavior, and improve cybersecurity control governance. It has implemented a cross-
functional process to identify and improve incident response procedures and increase testing for
evolving attack vectors such as social engineering.
UMG conducts regular security training including regular phishing training of all employees and a
blend of online and in-person training covering general security as well as application and developer
security. It has implemented additional non-technical measures including cyber insurance policies,
security incident simulations, and audits to mitigate the risks of an adverse cybersecurity event.
UMG has also advanced security detection technology installed on all workstations and servers
that allows for rapid detection of ransomware and other common security issues, allowing for swift
isolation of potentially affected systems for review and remediation.
Changes in global economic and financial conditions
A weakening of anticipated global economic growth, a return to sustained high inflation rates
or other periods of declining economic conditions, either globally or in any of the markets
in which UMG operates, could adversely affect UMG’s results from operations, cash flows and
financial conditions.
Economic growth and consumer confidence are important for UMG’s growth and strategy. A
significant portion of UMG’s revenue relies on consumers spending discretionary funds on leisure
activities, such as music subscriptions, CDs, vinyl albums and artist merchandise. Factors like
political uncertainty, and the state of the economy, including issues such as inflation, recession,
the availability of consumer credit, taxation and unemployment can influence the prevailing
macroeconomic conditions and affect UMG’s business.
While U.S. and other countries’ inflation rates continued to fall in 2024, a number of countries,
including many major economies in Europe, have reported high inflation. Concurrently, central
banks in such countries have raised or discussed the possibility of further increases of interest
rates in the future. Such increases in interest rates may reduce growth or result in a global or
regional recession. Further market volatility may occur if inflation increases again and markets
respond to the interest rate increases and the cessation of quantitative easing programmes by
major central banks. Increased inflation may impact the disposable income and shopping habits
of our customers which may in turn affect the demand for our products and services and our
ability to maintain our revenues in line with targets and expectations. Each of these events may
negatively impact discretionary funds available to consumers for leisure activities, and as a result
may negatively impact UMG’s revenues.
Risk response
UMG benefits from a diverse set of growth drivers, such as DSP penetration growth, social media
platforms, health/fitness applications, gaming, and Audio Video, among others, which makes UMG
less dependent on any one particular growth driver.
Furthermore, music consumption is relatively inexpensive compared to other forms of media
entertainment, and DSP providers generally make all content available, thus not requiring multiple
subscriptions. In the past, music consumption has proven to be resilient to macro-economic
downturns and so far we have not seen any material impact from any global economic downturn
on UMG’s results (despite lower advertising-funded streaming income growth, as the advertising
industry was impacted by the difficult economic environment).
Geopolitical instability
UMG’s results of operations, cash flows and financial condition may be adversely affected by
geopolitical instability. Unfavorable conditions can depress revenues in affected markets and
prompt actions that adversely affect our business and/or financial performance.
The 24 February 2022 invasion of Ukraine by Russian military forces has resulted in sustained
conflict and disruption in the region. In addition, an armed conflict in Israel and Gaza is ongoing,
after the 7 October 2023 attacks led by Hamas against Israel. Sanctions and other measures imposed
in response to these conflicts have increased global economic and political uncertainty. Although
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Russia, Ukraine and Israel each represented less than 1% of UMG’s total revenues and EBITDA for the
year ended 31 December 2024 and, as such, have not constituted (and do not currently constitute) a
material part of UMG’s business, armed conflicts between Russia and Ukraine and between Hamas
and Israel, could escalate. The significant escalation of these conflicts could increase economic
instability and disruption both inside those countries and across their regions. The extent and
duration of the military action, sanctions and resulting market disruptions could be significant and
could potentially have substantial impact on the global economy for an unknown period of time. As
a result of UMG’s revenue profile being very geographically diverse, any such downturn in the global
economy that reduces the disposal income of UMG’s customers may in turn have a negative impact
on UMG’s revenues.
Risk response
UMG's operation in Russia have been suspended since 8 March 2022, as per our public
announcement on that date.
UMG monitors political and general societal changes and, where necessary, develops response
strategies to such events. Furthermore, music consumption has proven to be resilient in macro-
economic downturns in the past and so far UMG has not experienced any material impact arising
from the effect of international sanctions. Consequently any extension of sanctions would likely only
have a minimal impact on UMG's results from operations.
Dependency on information technology systems
UMG’s operations are dependent on its information technology and information systems, and any
disruption to, or failure in, UMG’s IT system could adversely impact UMG’s operations.
The integrity, reliability and operational performance of UMG’s information technology (IT)
infrastructure and technology network are critical to its operations. UMG relies upon the capacity,
reliability, and security of its IT hardware and software infrastructure and its ability to expand and
update this infrastructure in response to changing needs.
Certain elements of the IT systems infrastructure on which UMG depends are outsourced to third
parties. The services and functions provided by these third parties are critical to UMG’s business and
include (but are not limited to) storage, data processing and network.
The availability of UMG’s IT platforms and other services may be interrupted by damage or disruption
to the UMG’s or UMG’s third-party service providers’ IT systems, which may be caused by, for
example hardware or software defects, human error, unauthorized access, fire, power loss, natural
hazards, the impact of war and terrorism, disasters or similarly disruptive events, as well as planned
upgrades and improvements which may be subject to developmental delay or fail to be effective.
While UMG has in place business continuity procedures, there can be no assurance that these will
be fully successful in preventing all disruptions to the availability of UMG’s IT platforms or other
services. To the extent UMG outsources its business continuity or disaster recovery operations, it is
at risk of the vendor’s unresponsiveness in the event of breakdowns in UMG’s systems, which could
cause delays in recovering service.
Furthermore, performance issues, system interruptions or other failures in the UMG’s IT systems
could expose UMG to potential liability to pay damages as well as reputational harm, additional
operating expenses to remediate the IT failures and exposure to other losses or other liabilities, all
of which could have a material adverse effect on UMG’s business, financial condition and results
of operations.
Risk response
UMG continues to invest in the maintenance, upgrading and testing of its IT infrastructure and
technology network, in addition to maturation of failover and overall Tech recovery plans to minimize
the risk impact of disruption. While UMG's insurance coverage may not cover all of the costs
and liabilities it incurs as the result of any such interruptions or failures of its IT systems, UMG
maintains what it considers to be an appropriate level of insurance against some of these risks.
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Financial risks
Access to and cost of financing
Risks related to access to and cost of financing are assessed based on UMG’s capacity in the coming
twelve months to have ready access to cash and cash equivalents and available confirmed credit
facilities and to generate sufficient cash flows and proceeds from sales to cover debt repayments,
dividend payouts and financial commitments.
Risk response
UMG has access to a €2 billion confirmed syndicated financing package (RCF) which provides the
necessary funds to cover UMG’s financial requirements and is used as back up for a €2 billion NEU
commercial paper program. The RCF was extended from April 2026 to April 2028. In addition, UMG
issued successfully in 2022 two tranches of bonds, including a €500 million tranche with a maturity
in 2027 and another €500 million tranche with a maturity in 2032. UMG also issued successfully in
2023 a €750 million bond with a 2031 maturity and a JPY 7 billion private placement with a 15- year
maturity (2038).
UMG's average debt maturity is 4.5 years, its liquidity remains above € 1billion, and the fixed-rate net
debt ratio remains above 75%.
Currency fluctuations
Unfavorable currency exchange rate fluctuations could adversely affect UMG’s results of operations.
A significant portion of UMG’s assets, liabilities, revenues and costs are denominated in currencies
other than Euros, in particular U.S. Dollars. To prepare UMG’s Financial Statements, UMG must
translate those assets, liabilities, revenues and expenses into Euros from such currencies at then-
applicable exchange rates. Consequently, increases and decreases in the value of the Euro as
compared to such other currencies will affect the amount of these items in the UMG Financial
Statements, even if their value has not changed in their original currency. These translations
could result in significant changes to its results of operations from period to period. In addition,
exchange rate fluctuations could cause expenses to increase as a percentage of net sales, affecting
profitability and cash flows.
Risk response
From time to time, UMG enters into foreign exchange contracts to hedge the risk of unfavorable
foreign currency exchange rate movements. UMG seeks to hedge currency transaction risks by
offsetting opposing cash flows (natural hedging) and using derivative hedges.
Changes in tax laws
Changes in tax laws or challenges to UMG’s tax position could adversely affect UMG’s results of
operations and financial condition.
Given the international footprint of the UMG’s operations globally, UMG is subject to tax laws and
regulations in more than 60 countries where it operates. Adverse developments in applicable tax
laws or regulations, or any change in the position by the relevant tax authorities or tax courts
regarding the application, administration or interpretation of any applicable tax laws or regulations,
could subject UMG to additional or increased tax payments, and in turn have a material adverse
effect on UMG’s business, financial condition and results of operations. If UMG’s tax positions are
challenged by tax authorities, the potential imposition of additional or increased taxes could require
UMG to pay taxes that UMG currently does not collect or pay or increase the costs of UMG's services
to track and collect such taxes, which could in turn increase UMG’s costs of operations or the UMG’s
effective tax rate and have a negative effect on UMG’s business, financial condition and results
of operations.
Moreover, any change in the tax law, such as an increase of tax rate or a change in determination of
tax basis, could have a material adverse impact. Given the international nature of UMG’s operations,
UMG may be particularly impacted by changes to regulations relating to transfer pricing and
withholding taxes on the repatriation of funds.
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Risk response
The Tax Policy supervised and approved by the Audit Committee states that UMG has a very low
tolerance to tax risk. The application of this guidance alleviates the potential adverse impact of
any change either in the application, administration or interpretation by tax administration or tax
courts. Moreover, as positions taken either for transactions, compliance and accounting purposes
are conservative any change in tax rates or tax basis might be mitigated.
Therefore, UMG’s tax procedures follow this governance and there is a process in place to implement
and monitor compliance with them. These procedures comply with tax rules in countries where UMG
operates as well as with requirements enacted by supra-national organizations, such as OECD and
the European Union. These procedures take into account the spirit of the laws and are updated as
necessary in order to incorporate any change of tax law or tax regulation impacting UMG. The Group
Tax Department and finance teams are in charge of establishing, maintaining and overseeing these
policies. The aim is to file all the required tax-relevant returns with the appropriate Tax Authorities
in a correct, timely and complete manner. To ensure this happens, (tax) compliance & reporting
processes are monitored through the Tax Risk and Control Framework which sets out the controls
established to assess and monitor tax risk for direct and indirect taxes (e.g., corporate income tax,
transfer pricing, VAT, wage tax and tax accounting).
The Group Tax Department monitors proposed changes in taxation legislation and ensures these are
taken into account when considering the operations and compliance. For this purpose, the Group
Tax Department employs qualified tax professionals who follow carefully any change in tax law
or tax regulations, with the assistance of qualified and reputable external advisors with requisite
qualifications and reputation.
Laws and regulations
Loss of intellectual property rights
The success of UMG’s business depends on its ability to obtain, maintain, protect and enforce its
trademarks, copyrights and other intellectual property rights around the world.
UMG’s intellectual property rights, as well as its ability to enforce such rights depend on the laws
and regulations of the many jurisdictions in which it conducts business, which are not consistent
across jurisdictions. An inability to obtain, maintain, protect or enforce its intellectual property rights
could harm UMG’s brand or brand recognition and adversely affect its business, prospects, financial
condition and results of operations.
In addition, if UMG is alleged to have infringed, misappropriated or otherwise violated the intellectual
property rights of a third party (even where such claims are without merit), any litigation to defend
the claim could be costly and would divert the time and resources of management, regardless of the
merits of the claim and whether the claim is settled out of court or determined in its favor.
There can be no assurance that UMG will be able to successfully obtain, protect, maintain or enforce
its intellectual property rights in every instance or would prevail in any such litigation. If UMG were
to lose a litigation relating to intellectual property (even if the claim is without merit), in addition to
the potential reputational damage, it could be forced to pay monetary damages, to obtain a license,
or to cease using certain intellectual property or technologies.
Additionally, artists signed by UMG may seek to challenge and dispute the scope or term of
intellectual property rights under their contracts entered into with UMG, including potential disputes
as to the application and effect of technological developments and new formats to access music.
Furthermore, notwithstanding any potential benefit of AI, new challenges for protecting our
intellectual property and other rights of our artists and songwriters may also arise from AI generated
music. See the “Generative AI” risk factor above.
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Any of the foregoing may cause UMG to suffer economic loss and reputational damage, which would
adversely affect UMG’s business, results of operations, financial condition and prospects.
Risk response
In order to obtain, maintain, protect and enforce its intellectual property rights, UMG takes a
variety of measures, including maintaining a staff of senior intellectual property and litigation
lawyers, engaging lawyers in different jurisdictions covering different fields of law and if necessary,
conducting litigation or proceedings before courts, governmental authorities or administrative
bodies. UMG also has a content protection unit tasked with leading and coordinating take downs
of content that infringes its intellectual property rights. UMG also engages in advocacy (both directly
and through trade associations) to influence any changes so that they do not negatively affect the
business or broader music industry and its stakeholders.
Data protection compliance
UMG’s business is subject to an increasing number of global laws, regulations, rules, and other
obligations governing data protection in addition to contractual obligations to business partners.
These restrictions and obligations govern the collection, use, retention, disclosure, transfer,
and security of data by UMG and its subsidiaries. Operations impacted by these laws include
consumer-facing operations such as eCommerce, online advertising, direct marketing, website
operation, and social media activities, as well as internal operations such as human resources
activities, management of royalties and artist relations, IT activities, and transfers of data among
UMG’s subsidiaries.
Regulatory, media, and political scrutiny of data protection compliance continues to grow. This
attention is further intensified by the emergence of powerful artificial intelligence tools that create
legal, ethical, and societal risk.
The legal landscape is also becoming more complex, with an ever-evolving landscape of laws and
regulations. Major legislation by US states, the European Union, and China among others has further
increased the complexity and risk of data protection laws. These laws, and the ways in which
authorities interpret and enforce them, may differ from jurisdiction to jurisdiction. Complying with
changing requirements may cause UMG to incur substantial costs, change its business practices,
modify its product and service offerings, and forego business opportunities.
In particular, the United States has seen a significant emergence of state-level privacy laws as well
as increased enforcement by federal agencies such as the Federal Trade Commission. California,
where UMG’s operational headquarters are located, continues to implement the strictest privacy
requirements in the United States, including the DELETE Act. A number of US states have passed
privacy laws that are either in effect or will be in the near future. These state laws are similar but not
identical, creating additional sources of complexity and potential costs to UMG.
Any perceived or actual failure by UMG, including its third-party service providers, to protect
confidential data or any material noncompliance with data protection laws could reduce UMG’s
ability to attract and retain customers, artists, and other business relationships and counterparties
and result in litigation or other actions being brought against UMG. Lastly, if third parties with whom
UMG works, such as UMG’s suppliers, violate applicable laws or UMG’s policies, such violations may
also put UMG data at risk and could in turn have an adverse impact on UMG’s business, prospects,
financial condition and results of operations.
Noncompliance, or even allegations of noncompliance, with these laws or UMG’s public statements
or contracts in these areas, could lead regulators or private actors to institute investigations
into or proceedings against UMG. These investigations or proceedings may entail legal costs and
reputational harm for UMG, and if defense of such proceedings is unsuccessful even in part, UMG
may face significant penalties, liability, or ongoing monitoring or audit requirements.
Risk response
UMG maintains a global data protection compliance program including personnel dedicated to
managing data protection risk. UMG’s data protection team partners with personnel throughout the
organization to identify and mitigate data protection risks.
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Recent initiatives include updates or improvements to privacy disclosures, governance and data
management processes, data subject rights processes, employee training, cross-border data transfer
agreements, supplier contract terms, internal audit procedures, and incident response processes.
UMG’s data protection compliance program prioritizes streamlined global rules and processes to
manage increasingly complex requirements. This improves the efficiency of compliance efforts and
reflects the interconnected nature of UMG’s artists, fans, and business operations.
The company advocates (both directly and through trade associations) to influence any changes
to the law so that they do not negatively affect the business or broader music industry and its
key stakeholders.
Governmental and regulatory challenges
A significant portion of UMG’s revenues are subject to regulation either by government entities or
by local third-party collecting societies throughout the world and rates on other income streams
may be set by governmental proceedings or be subject to legislative intervention, which may limit
its profitability.
Mechanical royalties and performance royalties (on both physical and digital sales) are two of
the main sources of income for UMG’s music publishing business, accounting for 14% of UMG’s
revenue in 2024 (2023: 14%), and mechanical royalties are an expense for its recorded music
business (except in instances when digital service providers pay such mechanical royalties directly
to publishers), representing 0.7% of UMG’s revenue in 2024 (2023: 0.8%). In the United States,
compulsory mechanical royalty rates are set every five years pursuant to an administrative process
under the U.S. Copyright Act, unless rates are determined through industry negotiations, and
performance royalty rates are most commonly, but not exclusively, determined by negotiations by
performing rights organizations, which in the U.S. include American Society of Composers, Authors
and Publishers (ASCAP), Broadcast Music, Inc. (BMI), the Society of European Stage Authors and
Composers (SESAC), and Global Music Rights, LLC (GMR). ASCAP and BMI are subject to a consent
decree rate-setting process if negotiations are unsuccessful.
The Antitrust Division of the U.S. Department of Justice (the DOJ) has previously reviewed its consent
decrees with ASCAP and BMI and, while in January 2021, the DOJ announced that it would take
no further action to modify or terminate such decrees, there is no guarantee that the DOJ will
not choose to review such decrees in the future. Changes to the mechanical royalty rate, the
performance royalty rates or consent decrees governing the U.S. performing rights organizations
could potentially impact the profitability of UMG’s music publishing business.
Outside of the United States, mechanical rates are typically negotiated on an industry-wide basis
(or for multi-territorial online licensing, on a repertoire- specific basis but still necessarily in
partnership with collecting societies as rights holders) and may be subject to mandatory collecting
regimes. In most territories outside the United States, mechanical royalties are typically based on a
percentage of wholesale prices for physical products and based on a percentage of consumer prices
for digital formats. Performance royalty rates are typically negotiated between the collecting society
and the individual licensee. The mechanical and performance royalty rates set pursuant to such
processes may adversely affect UMG by limiting its ability to increase the profitability of its music
publishing and/or recorded music businesses.
The performance royalty rates received by UMG’s recorded music business in the United States
for statutory webcasting and satellite radio are set every five years by an administrative process
under the U.S. Copyright Act unless rates are determined through industry negotiations. In most
jurisdictions outside the United States, UMG’s recorded music business receives payment for
the public performance and broadcast of its sound recordings via collecting societies, with rates
generally set by industry agreement or rate setting tribunal. In certain jurisdictions, governments
either have, are proposing or face certain pressure to introduce legislation which may introduce
and/or extend mandatory collective licensing and direct remuneration claims for certain rights, such
as (but not limited to) the introduction of an additional remuneration right for performers for the
so-called “making available” of sound recordings on digital services.
As revenues continue to shift from physical to diversified distribution channels, it is important that
UMG receives fair value for all of the uses of its intellectual property as its business model now
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depends upon multiple revenue streams from multiple sources. To the extent that the rates set
for recorded music and music publishing income sources through collecting societies or legally
prescribed rate-setting processes are set at levels which are not favorable or economically viable for
UMG, this could have an adverse impact on its business, prospects, financial condition and results
of operations.
Risk response
We participate and work with qualified counsel to build the best case in rate setting proceeding
that impact the industry. We educate stakeholders and advocate for policies that ensure music is
appropriately valued. The diversified nature of UMG’s business between types of sources of income
and geographies mitigates the impact to UMG in case any individual country were to implement laws
that could adversely affect the income that flows to UMG.
Changes in laws and regulations and legal proceedings
Changes in laws and regulations and legal proceedings that UMG is, or to which it could become
party, may have an adverse effect on UMG’s business.
UMG’s business is subject to a variety of laws, regulations and other public policies in jurisdictions
around the world, including those relating to intellectual property, content regulation, user privacy,
data and consumer protection, antitrust and competition, and ESG, among others.
Various governments currently have under consideration, and may in the future adopt, new
laws, regulations and policies regarding a wide variety of matters that could directly or indirectly
affect UMG’s business and operations, the ownership of UMG’s content assets or UMG’s ability
to maintain, protect or enforce its intellectual property rights. Furthermore, UMG’s licensing
agreements, including with streaming services, satellite radio, and web-based services may be
subject to regulatory scrutiny and might be the subject of regulatory action or antitrust litigation.
Furthermore, laws in various jurisdictions differ from each other in significant respects, and the
enforcement of such laws can be inconsistent and unpredictable. This could affect UMG’s ability
to operate its business in various jurisdictions and undertake activities that UMG believes is
beneficial to its business. For example, several countries, including the United Kingdom, Japan,
China and Hong Kong are considering proposals for Text and Data Mining (TDM) copyright exceptions
for purposes of permitting generative AI companies to use copyright-protected content without
authorization in order to build their platforms. Singapore has enacted such a policy. If enacted, such
policies would significantly reduce music companies' ability to maintain the levels of investment
necessary to foster a robust local music ecosystem in the relevant territories.
UMG could also be adversely affected by new laws and regulations, by the threat that additional laws
or regulations may be forthcoming and by changes in existing laws or changes in interpretation
of existing laws by courts and regulators. For example, changes in the area of copyright law, in
particular, could directly or indirectly affect UMG’s operations, the ownership of UMG’s content assets
or UMG’s ability to maintain, protect or enforce its intellectual property rights.
In addition, UMG’s operations are subject to a growing number of rules and regulations regarding
ESG. While there is growing demand for increased disclosure and transparency, UMG must balance
new disclosure requirements against the ability to provide relevant, standardized and accurate data
given the guidance available. In many cases, sustainability regulations and their related guidance
are new and continue to evolve. The growing number of environmental regulations, their increased
rigor and granularity, and in many cases their lack of interoperability, could result in substantial
costs of compliance. Furthermore, any failure of UMG to comply with such rules and regulations
due to UMG’s inability to adapt to changes to applicable regulations could lead to fines and other
penalties, as well as result in publicity which may impact UMG’s brand reputation.
UMG is also regularly involved in lawsuits, disputes or investigations initiated by consumers,
business partners, competitors, artists, governmental entities, tax authorities and third parties. Such
lawsuits, disputes or investigations may relate to, inter alia, copyright infringement, contractual
disputes, employment disputes, antitrust and tax disputes. For example, on May 13, 2021, individual
and putative class action claims were filed against UMG Recordings, Inc. in the U.S. District Court
for the Central District of California for breach of contract and fraud related to certain royalty
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RISK AND RISK MANAGEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
calculations. Litigation and proceedings before courts or governmental authorities, whether or not
UMG is involved in such proceedings, may serve as precedents that could adversely affect UMG’s
operations, ownership of content assets or intellectual property rights. UMG could incur substantial
costs to comply with new or modified laws and regulations or substantial penalties or other liabilities
if it fails to comply. UMG could also be required by such laws to change or limit certain of its
business practices, which could impact its ability to generate revenues.
Any of the foregoing may adversely impact UMG’s business, prospects, financial condition and
results of operations. See Note 26 “Litigation” in the Notes to the Consolidated Financial Statements
for additional information on legal proceedings.
Risk response
The company advocates (both directly and through trade associations) to influence any changes
to the law so that they do not negatively affect the business or broader music industry and
its key stakeholders. UMG has a structure to oversee the company's compliance with relevant
laws and changes in laws, including with respect to ESG. See also “Corporate Governance” for
additional information regarding the roles and responsibilities of individuals in our sustainability
management function.
In addition, UMG maintains a staff of senior litigation lawyers and may engage external lawyers to
assist with lawsuits, investigations and disputes. To the extent that changes in laws are the result of
litigation, UMG has a program of strategic litigation, both at the trade association and direct level, to
help build good precedents and avoid bad ones.
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RISK AND RISK MANAGEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
SUSTAINABILITY STATEMENT
GENERAL INFORMATION
General disclosures (ESRS 2)
General basis for preparation (BP-1)
The information contained in this Sustainability Statement has been prepared on a consolidated
basis and comprises Universal Music Group N.V. and its subsidiaries. Capitalized terms used but not
defined herein shall have the meaning assigned to them in the European Sustainability Reporting
Standards (ESRS).
Unless otherwise indicated, data is consolidated as of December 31, 2024. The scope of consolidation
is the same as the scope of consolidation for the Financial statements, unless stated otherwise.
This Sustainability Statement has been prepared to align with the ESRS on the assumption that
the Company will be bound by Dutch law requirements implementing obligations introduced by the
Corporate Sustainability Reporting Directive (CSRD). However, as the CSRD has not been transposed
into Dutch law as of the date of this Annual Report, this Sustainability Statement is provided on a
strictly voluntary basis.
This Sustainability Statement has been prepared to align with the requirements of the ESRS,
taking account of relevant CSRD-related requirements and guidance published by the European
Commission, the European Financial Reporting Advisory Group, and related regulators on or before
December 31, 2024. Given that such guidance has been published on an ongoing basis during
this early period of the CSRD implementation, it is possible that this Sustainability Statement may
not reflect guidance or other requirements published since that date. We expect to refine our
methodologies and significant assumptions, including for comparative figures, in future reporting
periods as more relevant information becomes available. In accordance with ESRS 1 section 10.3, we
have not provided comparative figures in this first year of CSRD reporting.
Our materiality assessment of impacts, risks, and opportunities (IROs) included considerations of
our upstream and downstream value chain, including through our products and services, as well
as through our business relationships. The extent to which applicable policies, actions, targets,
or metrics extend to our value chain is described in each applicable topical section of this
Sustainability Statement.
We have not exercised the option to omit information corresponding to intellectual property, know-
how, or the results of innovation as set forth in the ESRS 1 section 7.7.
The information in this Sustainability Statement is subject to limited assurance. See p. 267 for the
limited assurance report. Except as stated otherwise, no external body has validated the metrics in
this Sustainability Statement other than the independent assurance provider.
Disclosures in relation to specific circumstances (BP-2)
Time horizons
Short, medium, and long‑term time horizons are defined in line with ESRS 1 stipulations (i.e., one year
or less, one to five years, and over five years, respectively).
Value chain estimation, sources of estimation, and outcome uncertainty
UMG follows the Greenhouse Gas (GHG) Protocol throughout our emissions calculations and target-
setting process, and we adhere to the GHG Protocol’s five core principles: Relevance, Completeness,
Consistency, Transparency, and Accuracy. With respect to accuracy, UMG follows the GHG Protocol
guidance: “Ensure that the quantification of GHG emissions is systematically neither over nor under
actual emissions, as far as can be judged, and that uncertainties are reduced as far as practicable.
Achieve sufficient accuracy to enable users to make decisions with reasonable assurance as to the
integrity of the reported information
1
.”
1
GHG Protocol Corporate Accounting and Reporting Standard
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
UMG collects primary emissions data from suppliers, where possible, for our scope 3 GHG emissions
calculations. Where emissions data is not available, primary activity data (i.e., distance, spend,
units) is used to calculate emissions. In some cases, where primary data is not available for the
complete boundary of UMG activity, secondary data may be used to fill data gaps (i.e., extrapolations,
benchmarks). In 2024, approximately 9% of our total scope 3 emissions were calculated using
primary emissions data obtained from suppliers or other value chain partners.
UMG’s scope 3 emissions calculations include estimates using indirect sources, such as sector-
average data or other proxies. All of UMG’s reported scope 3 categories utilize industry average
emission factors from databases such as CEDA EEIO, DESNZ/BEIS, and ecoinvent LCA.
UMG performed a screening on the following scope 3 categories due to limited data availability.
Therefore, these categories are subject to a high level of measurement uncertainty:
■
Downstream transportation and distribution (category 9) - Data on downstream transportation
organized by customers is geographically limited; therefore, available data has been extrapolated
to ensure global estimation of this emissions source.
■
Franchises (category 14) - Data on the retail value of licensed merchandised products is
geographically limited; therefore, available data has been extrapolated to ensure global estimation
of this emissions source.
■
Investments (category 15) - Data on the operations (and therefore scope 1 & 2 emissions) of
investees is limited; therefore, available data has been extrapolated to ensure complete coverage
of UMG’s portfolio of investments in equity affiliates.
UMG seeks to collect more primary emissions and activity data each year to improve our data quality
and inform our emission reduction strategies and initiatives. For more information on our scope
3 calculations, see “GHG emissions methodology” in the Environmental information section of this
Sustainability Statement.
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SUSTAINABILITY STATEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Incorporation by reference
DISCLOSURE REQUIREMENTS Section Chapter Additional information, if any Page
ESRS 2 General Disclosures
GOV-1 The role of the administrative, management and supervisory bodies
21 a The number of executive and non-executive members Board Report Corporate Governance, The
Board, Composition
60
21 b Information about representation of employees and other workers Board Report Corporate Governance, The
Board, Composition
None of the Non-Executive Directors
represents the Company's employees
and other workers.
60
21 c Experience relevant to the sectors, products and geographic locations of the undertaking Appendix Biographies of the Corporate Executives,
Biographies of the Board of Directors
272-279
21 d Percentage by gender and other aspects of diversity Board Report Corporate Governance, Diversity and
Inclusion, Overview
64
Non-Executive
Directors' report
Non-Executive Directors' Report, Diversity
and Inclusion
154-155
21 e The percentage of independent board members Board Report Corporate Governance, The
Board, Composition
% of independent board members is
50%, calculated based on independent
non-executive directors (pg. 156), and
board members (pg. 60)
60
Non-Executive
Directors' report
Non-Executive Directors'
Report, Independence
155-156
22 a The identity of the administrative, management and supervisory bodies (such as a board committee or similar)
or individual(s) within a body responsible for oversight of impacts, risks and opportunities
Board Report Corporate Governance, The Board,
Sustainability management
69-70
22 b How each body's or individual's responsibilities for impacts, risks and opportunities are reflected in the
undertaking's terms of reference, board mandates and other related policies
Board Report Corporate Governance, The Board,
Board committees
67
22 c A description of management's role in the governance processes, controls and procedures used to monitor,
manage and oversee impacts, risks and opportunities, including:
Board report Corporate Governance, The Board,
Sustainability management
69-70
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SUSTAINABILITY STATEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
DISCLOSURE REQUIREMENTS Section Chapter Additional information, if any Page
22 c i Whether that role is delegated to a specific management-level position or committee and how oversight is
exercised over that position or committee
Board report Corporate Governance, The Board,
Board committees
67
22 c ii Information about the reporting lines to the administrative, management and supervisory bodies Board report Risk and Risk Management, Governance,
Risk and Compliance
82-83
22 c iii Whether dedicated controls and procedures are applied to the management of impacts, risks and opportunities
and, if so, how they are integrated with other internal functions
Board report Risk and Risk Management, Governance,
Risk and Compliance
Risk and Risk Management, Monitoring
and Assurance
82-83
83
22 d Disclosure of how administrative, management and supervisory bodies and senior executive management
oversee setting of targets related to material impacts, risks and opportunities and how progress towards them
is monitored
Board report Corporate Governance, The Board,
Sustainability management
69-70
23 Disclosure of how administrative, management and supervisory bodies determine whether appropriate skills
and expertise are available or will be developed to oversee sustainability matters
Board report Corporate Governance, The Board, Board
committees, Nomination committee
68-69
Non-Executive
Directors' Report
Non-Executive Directors' Report, Education Non-Executive Directors are required
to follow an induction program aimed
at addressing any gaps in his or
her knowledge.
157
23 a The sustainability-related expertise that the bodies, as a whole, either directly possess or can leverage, for
example through access to experts or training; and
Appendix Biographies of the Corporate Executives,
Biographies of the Board of Directors
272-279
Non-executive
Directors' report
Non-executive Directors' report, Education 157
Board report Organizational and Reporting Structure,
Corporate Executives
46-49
23 b How those skills and expertise relate to the undertaking's material impacts, risks and opportunities Appendix Biographies of the Corporate Executives,
Biographies of the Board of Directors
272-279
Non-executive
Directors' report
Non-executive Directors' report, Education 157
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SUSTAINABILITY STATEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
DISCLOSURE REQUIREMENTS Section Chapter Additional information, if any Page
Board report Organizational and Reporting Structure,
Corporate Executives
46-49
GOV-2 Information provided to and sustainability matters addressed by the undertaking’s administrative, management and
supervisory bodies
26 a Disclosure of whether, by whom and how frequently administrative, management and supervisory bodies are
informed about material impacts, risks and opportunities, implementation of due diligence, and results and
effectiveness of policies, actions, metrics and targets adopted to address them
Board report Corporate Governance, The Board,
Sustainability management
69-70
26 b Disclosure of how administrative, management and supervisory bodies consider impacts, risks and
opportunities when overseeing strategy, decisions on major transactions and risk management process
Board report Corporate Governance, The Board,
Sustainability management
69-70
26 c Disclosure of list of material impacts, risks and opportunities addressed by administrative, management and
supervisory bodies or their relevant committees
Board report Corporate Governance, The Board,
Sustainability management
69-70
GOV-3 Integration of sustainability-related performance in incentive schemes
29 Incentive schemes and remuneration policies linked to sustainability matters for members of administrative,
management and supervisory bodies exist
Board report Corporate Governance, The
Board, Remuneration
Incentive plans for the Executive
Directors do not currently incorporate
key performance indicators linked to
sustainability matters.
66
GOV-5 Risk management and internal controls over sustainability reporting
36 b The risk assessment approach followed, including the risk prioritization methodology Board report Risk and Risk Management, Risk Appetite UMG’s risk appetite differs depending on
the type of risk, ranging from averse to a
seeking approach.
82
36 e Description of periodic reporting of findings of risk assessment and internal controls to administrative,
management and supervisory bodies
Board report Corporate Governance, The Board,
Sustainability management
Risk and Risk Management, Governance,
Monitoring and Assurance
All our businesses are required to
maintain and manage a sound internal
control environment with robust policies,
procedures and controls and strong
financial discipline.
69-70
83
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SUSTAINABILITY STATEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
DISCLOSURE REQUIREMENTS Section Chapter Additional information, if any Page
SBM-1 Strategy, business model and value chain
40 b Total revenue Board report Financial review, Consolidated statement of
profit and loss
Revenues 50
42 a Description of inputs and approach to gathering, developing and securing inputs About UMG How UMG adds value Input 24
42 b Description of outputs and outcomes in terms of current and expected benefits for customers, investors and
other stakeholders
About UMG How UMG adds value Output 24
ESRS E1 Climate Change
E1.GOV-3 Integration of sustainability-related performance in incentive schemes
13 Disclosure of whether and how climate-related considerations are factored into remuneration of members of
administrative, management and supervisory bodies
Board report Corporate Governance, The
Board, Remuneration
Incentive plans for the Executive
Directors do not currently incorporate
key performance indicators linked to
sustainability matters.
66
ESRS S1 Own Workforce
S1-6 Characteristics of the undertaking's employees
50f Disclosure of cross-reference of information reported under paragraph 50 (a) to most representative number in
financial statements
Financial statements Notes to the consolidated statements,
Costs of revenues and selling, general and
administrative expenses
204-205
S1-9 Diversity metrics
66 a The undertaking shall disclose the gender distribution in number and percentage at top management level Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management, Overview 64
S1.MDR-T Minimum disclosure requirements - Targets
80 a A description of the relationship of the target to the policy objectives Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
80 b The defined target level to be achieved, including, where applicable, whether the target is absolute or relative
and in which unit it is measured;
Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
80 c The scope of the target, including the undertaking’s activities and/or its upstream and/or downstream value
chain where applicable and geographical boundaries;
Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
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SUSTAINABILITY STATEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
DISCLOSURE REQUIREMENTS Section Chapter Additional information, if any Page
80 e The period to which the target applies and if applicable, any milestones or interim targets; Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
80 f The methodologies and significant assumptions used to define targets, including where applicable, the
selected scenario, data sources, alignment with national, EU or international policy goals and how the targets
consider the wider context of sustainable development and/or local situation in which impacts take place;
Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
80 j The performance against its disclosed targets, including information on how the target is monitored and
reviewed and the metrics used, whether the progress is in line with what had been initially planned, and an
analysis of trends or significant changes in the performance of the undertaking towards achieving the target.
Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
S1.MDR-P Minimum disclosure requirements - Policies
65 a Description of key contents of policy Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
65 b Description of scope of policy or of its exclusions Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
65 c The most senior level in the undertaking’s organisation that is accountable for the implementation of
the policy
Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
65 d Disclosure of third-party standards or initiatives that are respected through implementation of policy Board report Corporate Governance, The Board, Diversity
and Inclusion
The senior management 62-65
ESRS G1 Business Conduct
G1.GOV-1 The role of the administrative, management and supervisory bodies
5 a Disclosure of role of administrative, management and supervisory bodies related to business conduct Board report Corporate Governance, The Board,
Board committees
Among other responsibilities, Audit
committee supervises the effect of the
Code of Conduct.
67
5 b Disclosure of expertise of administrative, management and supervisory bodies on business conduct matters Appendix Biographies of the Corporate Executives,
Biographies of the Board of Directors
272-279
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SUSTAINABILITY STATEMENT
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Governance
Statement on due diligence (GOV-4)
Core elements of due diligence Relevant disclosures
(a) Embedding due diligence in
governance, strategy, and business model
GOV-2
GOV-3
SBM-3
(b) Engaging with affected stakeholders in
all key steps of the due diligence
GOV-2
SBM-2
IRO-1
G1-2
S1-1
S1-2
(c) Identifying and assessing
adverse impacts
IRO-1
SBM-3
G1-2
S1-2
(d) Taking actions to address those
adverse impacts
S1-3
(e) Tracking the effectiveness of these
efforts and communicating
E1-4
E1-6
S1-4
S1-5
S1-6
S1-16
Risk management and internal controls over sustainability reporting (GOV-5)
Sustainability internal control environment
For all quantitative sustainability disclosures, UMG utilizes a global data collection and consolidation
platform for environmental and social demographics reporting. The platform is designed to include
mathematical coherency and checks to ensure data consistency and flag any potentially abnormal
variation during the input process. Each reporting entity conducts an initial validation and
consistency check of their submission. The ESG department performs a second coherency check
and validation during the consolidation process. Lastly, the ESG department conducts a trend
analysis, validates the results of this analysis with business unit leaders, and evaluates and
documents explanations for variances. For all qualitative sustainability disclosures, UMG maintains
a centralized database for gathering, reviewing, and verifying information.
In 2024, we updated our sustainability‑related controls to capture new data points required under
CSRD. In designing these controls, UMG considered risks such as the completeness and integrity
of the data, the accuracy of estimation results, the availability of upstream and downstream value
chain data, and the timing of the availability of the information.
We continue to work towards the full implementation of these controls. In 2025, we intend to make
further improvements aimed at optimizing the risk and control framework, including improving the
documentation of controls.
Risk management and internal controls over sustainability reporting
As described in "Description of the process to identify and assess material impacts, risks, and
opportunities (IRO-1)", our DMA (as defined therein) considered the results of our latest annual
risk assessment and consulted our risk management team and senior leadership. We incorporated
the inputs of our latest risk assessment into our DMA through a series of validation exercises
and workshops. In the future, we intend to assess the extent to which our sustainability reporting
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SUSTAINABILITY STATEMENT
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
processes may be further integrated into and aligned with our general risk management processes
as part of our overall management process. For more information on our process to identify, assess,
prioritize, and monitor risks that may have financial effects, as well as our risk assessment process,
see the Risk and Risk Management section of the Board report.
Strategy
Strategy, business model, and value chain (SBM-1)
Our DMA process, described in detail in "Description of the process to identify and assess material
impacts, risks, and opportunities (IRO-1)", identified the sustainability matters that are most
important to our business and to our stakeholders. The resulting identified material topics are
representative of the ways in which our business and sustainability strategies are connected.
As discussed in the Strategy section of the Board report, UMG’s creative and commercial foundation
is built on a set of key focal points, each of which is linked with our material sustainability matters,
as set forth below. As we work towards developing a comprehensive sustainability strategy and
further defining our sustainability goals, we will seek to further align our business strategy with
sustainability considerations, creating value for stakeholders while addressing the environmental
and social challenges inherent in the music industry.
■
Strategic focus: Continuing our mission of discovering and breaking new artists and songwriters
and supporting them at every stage of their career to help them achieve their greatest creative
and commercial potential.
Related sustainability matters: As further described in "Attraction and retention of artists" in the
Social information section of this Sustainability Statement, artists are at the core of our business
and of our ability to generate positive cultural impacts.
Through our DMA process, we homed in on the interconnected nature of our material
sustainability matters. To successfully continue to discover, attract, retain, and support artists and
songwriters, we recognize the importance of successfully attracting and retaining top-tier talent
and continuing to foster a culture of belonging throughout our operations. For more information
on our management of our material topics of “Attraction and retention of employees”, “Gender and
gender equality”, and “Diversity, inclusion, and belonging”, see "S1: Own workforce" in the Social
information section of this Sustainability Statement.
■
Strategic focus: Maximizing and protecting the value of our extraordinary catalog, both now and
into the future.
Related sustainability matters: We are committed to proactively protecting our intellectual
property and using it to create socioeconomic value for our artists. We continue to face
longstanding challenges, such as streaming fraud and illegal file-sharing, as well as new
challenges, such as intellectual property infringement using AI. Our dedicated Content Protection
team continues to address these challenges. Our approach to the challenges and our key actions
to protect our intellectual property are described in further detail in "Intellectual property, piracy,
and content protection" in the
Governance information section of this Sustainability Statement.
■
Strategic focus: Driving growth in subscription and ad-supported streaming revenue around the
world and expanding our capabilities and repertoire in high-growth markets.
Related sustainability matters: We are committed to expanding our presence and accelerating our
growth in both high-growth markets and far-reaching regions to discover exciting new music
and artists globally, expand our catalog and repertoire, create opportunities to connect with
local music fans, help introduce new music to global audiences, and increase market share.
As markets grow in emerging territories, so does the challenge of leaks in those regions. As
further described in "Intellectual property, piracy, and content protection" in the Governance
information section of this Sustainability Statement, we continue to partner with our international
trade organizations to build content protection strategies and workstreams that support the
development of emerging music markets.
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SUSTAINABILITY STATEMENT
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■
Strategic focus: Building partnerships with innovators to explore how technology can be used to
drive engagement and discovery, as well as to create new commercial opportunities for artists.
Related sustainability matters: As a corollary to building partnerships for innovation, we continue
to collaborate with our partners to protect the value of our artists’ work. We continue to work with
our licensed service partners to share intelligence and introduce workflows to counter the threat
of streaming fraud, among other challenges. We are also taking steps to advocate and fight for
the responsible use of AI. For more information, see "Intellectual property, piracy, and content
protection" in the Governance information section of this Sustainability Statement.
■
Strategic focus: Working to maximize the power, influence, and impact of music to drive social
conversation, discovery, engagement, and further fuel fandom and music consumption.
Related sustainability matters: We believe that our purpose – to shape culture through the power
of artistry – includes supporting action on climate change. We are committed to reducing our GHG
emissions, underscoring our dedication to meaningful change. To support this commitment, we
set science-based targets and report our scope 1, 2, and 3 emissions annually.
Challenges to reducing our scope 1 and 2 emissions include the availability of renewable energy
solutions in markets where we operate; barriers to purchasing renewable energy for small, leased
facilities; and potential increased costs for renewable energy solutions. Challenges to reducing
our scope 3 emissions include the breadth of supplier engagement required to measure and
reduce environmental impacts across our value chain; the availability of innovative, scalable
solutions and their associated potential costs; and the ability to collect complete, accurate, and
timely supplier data. We are developing strategies and initiatives to address these challenges and
will continue to share our progress for reducing our emissions. For more information on this topic,
see our
Environmental information.
■
Strategic focus: Advancing data and insights to help fuel discovery and inform our ability to
connect our artists with their fans.
Related sustainability matters:
As discussed further in the Strategy section of the Board report, our
data and analytics team comprises analysts, data scientists, and coders who develop algorithms
to help UMG identify talent faster and more efficiently than our competition, supporting our
ability to attract artists, as further described in "Attraction and retention of artists" in the Social
information section of this Sustainability Statement. As we continue to leverage data, we recognize
that the ethical and compliant collection, use, and sharing of data is essential to maintaining the
trust of our stakeholders. To this end, our global data protection compliance program includes
governance and data management processes, data subject rights processes, privacy disclosures,
employee training, cross-border transfer agreements, supplier contract terms, internal audit
procedures, and incident response processes. For more information on this topic, see "Privacy
and cybersecurity" in the
Governance information section of this Sustainability Statement.
■
Strategic focus: Enhancing our capabilities to comprehensively serve and maximize the value of
superfans through D2C, eCommerce, and product development and increasing monetization.
Related sustainability matters: In recent years, the launch of UMG’s own dynamic global
eCommerce platform has enabled our D2C, digital goods, merchandise, and eCommerce divisions
to accelerate and amplify artists’ ability to create experiential, commerce, and content offerings
for their fans. This is economically vital to our artists, as further described in "Attraction and
retention of artists" in the
Social information section of this Sustainability Statement.
As we continue to explore ways to strengthen and better serve the artist-fan relationship through
superfan experiences and products, we seek to partner with suppliers who share our vision
for a sustainable future. To support this goal, we incorporate our Supplier Social Responsibility
Policy into all global manufacturing agreements, have developed targeted, ongoing sustainability
strategies for the product development teams for Bravado, UMG’s merchandising arm, and
Universal Music Manufacturing & Logistics (UML), and implemented our Environmental Exhibit
to drive our suppliers to set and validate their own science-based targets to further reduce GHG
emissions, among other efforts. For more information, see "Supply chain management" in the
Governance information section of this Sustainability Statement.
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For a description of the key elements of our general strategy that relate to or affect sustainability
matters, as well as additional information regarding the key elements of our business model and
value chain, see the Strategy section of the Board report.
For employee headcount breakdowns by geographical area, pursuant to SBM-1 40(a) iii, see the Social
information section of this Sustainability Statement.
The current ESRS definitions of industry sectors do not include industry sectors that are applicable
to UMG.
MUSIC IS UNIVERSAL Annual Report 2024 | 113
SUSTAINABILITY STATEMENT
UPSTREAM OWN OPERATIONS DOWNSTREAM
RECORDED
MUSIC
The recorded
music business
discovers and
develops recording
artists, marketing,
and promoting
their music across
a wide array of
formats and
platforms.
Its activities also
extend to other
areas, such as
live events,
sponsorship,
film, and
television.
MUSIC
PUBLISHING
The music
publishing
business discovers
and develops
songwriters
and owns and
administers
the copyright
for musical
compositions
used in
recordings, public
performances,
and related uses,
such as films and
advertisements.
MERCHANDISING
The merchandising
business produces
and sells artist-
branded and other
branded products
through multiple
sales channels,
including fashion
retail, concert
touring, and the
internet. Its
activities also
extend to other
areas, such as
brand rights
management.
PHYSICAL SUPPLY
CHAIN & LOGISTICS
UMG generates
revenue through the
physical sales of
UMG-produced
content in partnership
with our global network
of manufacturing
partners. Physical
recorded music
products include
CDs, vinyl records,
cassette tapes, DVDs,
and Blu-Ray discs,
and merchandise.
Products are sold
through retailers and
wholesalers both
in-store and online.
We also sell our
products directly to
customers via our UMG
websites and affiliate
channels. UMG utilizes
logistics partners for
air, ocean, and road
transport of our
physical products.
FANS
Fans engage
with UMG
artists and
music,
purchase
products,
and participate
in consumer
experiences
such as live
events.
CONTENT
PUBLISHERS,
COLLECTION
SOCIETIES,
PERFORMANCE
RIGHTS
OWNERS
UMG’s revenues
are subject to
regulation either
by government
entities, industry
negotiations,
and/or by local
third-party
collecting
societies
throughout
the world.
DIGITAL SUPPLY
CHAIN
UMG enters into
agreements with
digital music
services to make
our music and
audiovisual content
available for access
in digital formats,
such as streaming
and downloads.
Our music is
streamed on an
ad-supported and
paid subscription
basis through
streaming services.
Digital service
providers include
Spotify, Apple, and
Amazon.
SHAREHOLDERS
AND CREDITORS
UMG’s corporate
interests extend to
the interests of all
of the company’s
stakeholders.
GOVERNMENT
AND ELECTED
OFFICIALS
Government and
elected officials
monitor and
enforce laws,
regulations, and
policies that UMG
must comply
with, including
intellectual
property rights,
trade policies, and
free expression.
TRADE
ASSOCIATIONS
UMG is a member
of trade associati-
ons, such as the
IFPI and RIAA,
which represent
the interests of
the music industry
and protect music
and creators’
rights.
ARTISTS AND
SONGWRITERS
Artists and
songwriters
are at the heart of
everything we do
at UMG. Focused
on their long-term
development,
our company is
built to serve
artists’ unique
needs throughout
their careers. UMG
invests in music
production and
marketing as well
as global artist
promotion.
STAKEHOLDER AND VALUE CHAIN MAP
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Interests and views of stakeholders (SBM-2)
Stakeholder Engagement
We actively engage with our stakeholders regarding our strategic direction and seek their input
when evaluating our sustainability matters (see “Our Double Materiality Assessment” for further
information). As applicable, stakeholder input is shared with our management or Board through
various channels, including through our Investor Relations team, as part of our DMA process and
through regular internal periodic reporting.
UMG has six key stakeholder groups with whom we engage as set forth in the table below
and, as applicable, pursuant to our DMA process. For information about how our administrative,
management, and supervisory bodies are informed about the interests of our stakeholders with
respect to sustainability matters, see “Corporate Governance—Sustainability management” in our
Board report.
Stakeholder group How we engage Purpose and outcome of engagement
Artists
■
Maintaining close direct connections with artists at every label and division of the company,
including through A&R, marketing, and merchandising teams
■
Interacting with our artists indirectly through their advisors
■
Offering artists a full range of services
■
Investing in continued artist development at all stages of their careers
■
Fostering creative expression and collaboration within our diverse roster of artists
■
Partnering with an expansive network of distribution partners so that artists can share their work with a growing global fan base
■
Working with distribution partners and regulators to achieve fair compensation for music content
■
Embracing new technologies that can increase music consumption and fan engagement
■
Creating new and exciting experiences for artists to engage with their fans
Fans
■
Direct-to-fan communications through email, SMS, and community platforms
■
Facilitating new experiences for fans to engage with their favorite artists and music
■
Promoting direct connections between artists and fans
■
Meeting fan product demands, including developing premium products for super fans
■
Helping fans engage with their favorite artists in new and exciting ways
■
Driving technological innovation to improve the creative process, and artist- fan connections
■
Partnering with an expansive network of distribution partners and retailers to facilitate access to our artists’ music and merchandise
■
Enabling D2C sales through ecommerce and merchandising opportunities
■
Creating premium consumer products via our production, manufacturing and distribution arms
■
Tailoring and personalizing fan experiences
■
Further developing artists’ relationships with their fans and deepening their connections
Employees
■
Written and in-person communications from our PIC team
■
Formal and informal feedback channels to encourage open dialogue
■
Online resources to answer employee questions quickly and easily
■
Regularly assessing the employee experience and culture including by conducting lifecycle and
pulse surveys
■
Measuring each employee’s individual experience at various stages of the employee lifecycle (first week new hire, 90-day new hire,
and exit)
■
Building a culture in which all employees feel safe, seen, heard, respected, and connected
■
Working together to improve learning, diversity, and inclusion, engagement, retention, and wellbeing
■
Tapping into innovation, collaboration, creativity, and artistry across UMG’s businesses
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Stakeholder group How we engage Purpose and outcome of engagement
■
Holding employee forums, resource groups, and events
■
Encouraging a growth mindset through mentoring and programs that support a culture of innovation
■
Investing in employee training programs to support learning and development
Distribution partners
■
Ongoing dialogue with our digital and corporate business development teams
■
Regular product innovation discussions, data and analysis sessions, and deal negotiations
■
Developing content and marketing plans aligned with growing engagement on partners’ platforms
■
Investing in talent in both developed and emerging music markets
■
Promoting all UMG artists to fans around the world
■
Embracing technological advancements that improve the sound quality of our historic catalog
Public officials
■
Responding to formal information requests (such as public hearings and consultations)
■
Convening and participating in educational and advocacy meetings
■
Advocating for public policies that protect and grow the music ecosystem
■
Joining music industry trade organizations and non-government organizations, and
contributing to their published products and educational and advocacy efforts
■
Ongoing dialogue with our public policy team
■
Educating public officials about how proposed policies would impact our business and industry
■
Creating employment and generating economic benefits for the communities in which we operate
■
Supporting culture through the creation and distribution of great music and associated content
■
Operating at the highest ethical standards that comply with all applicable laws and regulations
■
Adhering to business practices that treat artists and songwriters and all creators fairly
Shareholders
■
Conversing directly via investor meetings and teleconferences with our Investor Relations (IR)
team and management
■
Publishing interim and Annual Reports
■
Presenting quarterly financial results webcasts with management Q&A sessions
■
Holding Annual General Meetings
■
Disseminating notable developments via public press releases
■
Maintaining UMG corporate and IR websites
■
Responding to all queries via a dedicated IR email address
■
Participating in financial and industry conferences
■
Providing updates on the competitive landscape, strategy, and growth drivers across the business
■
Furnishing details on our capital allocation priorities and rationale
■
Disclosing our sustainability progress
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Material impacts, risks, and opportunities and their interaction with strategy and business
model (SBM-3)
Except as otherwise indicated, information regarding our material IROs is presented in the table
below and in each applicable topical section of this Sustainability Statement.
Unless stated otherwise, the policies, actions, metrics, and targets presented in each topical section
of this Sustainability Statement are applicable to the IROs pertaining to the material topics addressed
in each such section. UMG did not identify any material risks or opportunities for which there is a
significant risk of a material adjustment within the next annual reporting period.
Material topic I/R/O IRO description Actual or
potential
Value chain
location
Time horizon
(Short-, Medium-,
Long- term)
Discussion of effects on
business model, value
chain, strategy, decision-
making (page)
Attraction
and retention
of artists
I (+) Supporting talented artists can generate socioeconomic and cultural benefits throughout the
music ecosystem
Actual Upstream,
own operations,
downstream
S 147-148
R UMG’s business may be adversely affected if UMG fails to identify, attract, sign, and retain successful
recording artists and songwriters or by the absence of superstar releases
Actual Upstream,
own operations
S 147-148
O Our artists' success directly financially benefits UMG, generates long-term value to artists, and greatly
increases the commercial success, consumer base, and longevity potential for artists at every stage of
their careers
Actual Upstream,
own operations
L 147-148
Attraction
and retention
of employees
I (+) Attraction and retention of skilled employees may increase morale, job satisfaction, and employee well-being Actual Own operations L 142-145
I (+) Retention of skilled employees may create reputational benefits, furthering the ability to attract greater talent Potential Own operations L 142-145
I (+) Attraction and retention of skilled employees may increase the ability to attract and retain artists Actual Own operations L 142-145
I (-) Failure to attract or retain talent may result in reputational damage and/or decreased morale, job satisfaction,
and/or wellbeing among existing workforce
Potential Own operations M 142-145
Diversity,
inclusion,
and belonging
I (+) Diverse talent and points of view can increase our resilience as a company as well as the creativity behind our
products and services
Actual Own operations,
downstream
S 143-145
Gender equality
and equal pay
I (+) Equal pay for equal work may positively impact employees by promoting fairness and reducing
discrimination, leading to more socioeconomic benefits for employees and their communities
Actual Own operations S 147
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Material topic I/R/O IRO description Actual or
potential
Value chain
location
Time horizon
(Short-, Medium-,
Long- term)
Discussion of effects on
business model, value
chain, strategy, decision-
making (page)
Intellectual
property, piracy,
and content
protection
I (+) Protecting intellectual property rights encourages creators to invest time, resources, and effort into developing
new ideas, inventions, and artistic works and incentivizes innovation and creativity.
Actual Upstream S 150-152
I (+) UMG encourages its digital partners to support content protection by taking direct action against unauthorized
activity on their platforms
Actual Downstream M 150-152
I (-) UMG’s failure to manage this topic could result in brand exposure challenges for artists, for instance, where
poor quality bootlegs are illegally released
Potential Upstream M 150-152
I (-) UMG’s failure to manage this topic could result in harm to creators’ rights, including through intellectual
property infringement through the unauthorized reproduction of copyrighted works to train AI technology,
which in turn enables the creation of AI generated works that infringe intellectual property rights and embody
unauthorized renditions of artist voices, images, and likenesses
Potential Upstream M 150-152
I (-) UMG’s failure to manage this topic could deprive artists of their ability to authentically share their art and
connect with their fans
Potential Upstream S 150-152
R Piracy, including stream manipulation, enables the distribution of music in a manner that does not provide an
economic return for UMG or its artists and songwriters
Actual Upstream,
own operations
M 150-152
R Sales of counterfeit merchandise may undermine UMG’s brand value, interfere with marketing strategies
of our artists, and divert potential customers from legitimate purchases, which may directly impact UMG’s
revenue growth
Actual Upstream,
own operations
M 150-152
O A substantial number of tracks uploaded to digital streaming platforms (DSPs) are frequently misattributed or
intentionally mislabeled, preventing UMG from earning revenue from the creative works of artists and labels.
UMG’s ability to detect and accurately attribute these tracks presents a financial opportunity for the business
Actual Upstream,
own operations
M 150-152
Privacy and
cybersecurity
I (-) Failure to manage this topic may result in harm to other members of our value chain whose data and content
we protect
Actual Upstream S 152
I (-) The availability of UMG’s IT platforms and other services may be interrupted by damage or disruption to UMG
or UMG’s third-party service providers’ IT systems. While UMG has in place business continuity procedures,
there can be no assurance that these will be fully successful in preventing all disruptions to the availability of
UMG’s IT platforms or other services
Potential Upstream,
own operations
M 152
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Material topic I/R/O IRO description Actual or
potential
Value chain
location
Time horizon
(Short-, Medium-,
Long- term)
Discussion of effects on
business model, value
chain, strategy, decision-
making (page)
R Noncompliance, or even allegations of noncompliance, with data protection laws could lead government
entities, supervisory authorities, or private actors to institute investigations into or proceedings against UMG
that may entail legal costs and reputational harm, and if defense of such proceedings is unsuccessful even in
part, UMG may face significant penalties, liability, or ongoing monitoring or audit requirements
Actual Own operations S 152
R Any perceived or actual failure by UMG, including its third-party service providers, to protect confidential data
could reduce UMG’s ability to attract and retain customers
Potential Own operations M 152
R If third parties that UMG works with, such as UMG’s suppliers, violate applicable laws or UMG’s policies, such
violations may also put UMG data at risk and could in turn have an adverse impact on UMG’s business,
prospects, financial condition, and results of operations
Potential Own operations,
downstream
M 152
Supply chain
management
I (+) Actively managing our supply chain may allow UMG to promote innovation, promote human rights and local
economies, and have a positive environmental impact
Actual & potential Upstream,
downstream
M 149-150
GHG emissions I (-) UMG has GHG emissions which negatively impact the environment Actual Downstream M 132-141
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Impact, risk, and opportunity management
Description of the process to identify and assess material impacts, risks, and opportunities (IRO-1)
Our Double Materiality Assessment Process
In 2022, we conducted our first materiality assessment to identify the ESG topics most material to
UMG. Topics were evaluated based on their importance to the business as well as their importance
to stakeholders, and the potential impacts of each topic were considered across the broader
economy, environment, and society at large. In 2023, we further validated our material topics
with subject matter experts and a cross-functional group of over 100 UMG leaders across our
business operations.
As part of our preparation of this Sustainability Statement and in accordance with the requirements
of the CSRD, we refreshed our materiality assessment methodology and undertook an updated
assessment process. We expect to continue to refine our methodology as further guidance emerges
and additional information becomes available.
To determine the materiality of sustainability matters and identify our material IROs, UMG applied
the principle of double materiality. Double materiality incorporates an assessment of UMG’s actual
and potential impacts on sustainability matters (impact materiality) alongside an evaluation of
the actual and potential financial effects of various sustainability matters on our enterprise value
(financial materiality).
Impact Materiality
As part of our Double Materiality Assessment (DMA) process, we considered the material actual or
potential, positive or negative impacts on sustainability matters within the meaning of the CSRD and
ESRS over the short-, medium-, or long-term. Such impacts include those connected with our own
operations, upstream, and downstream value chain, including through our products and services, as
well as through our business relationships.
When evaluating actual negative impacts, we considered the severity of the impact, meaning
the scale, scope, and irremediable character of the impact. For potential negative impacts, we
considered the severity and likelihood of the impact. For our evaluation of actual positive impacts,
we considered the scale and scope of the impact. For potential positive impacts, we considered the
scale, scope, and likelihood of the impact.
Financial Materiality
To evaluate financial materiality, we considered the sustainability matters that generate risks or
opportunities that have a material influence, or could reasonably be expected to have a material
influence, on our development, financial position, financial performance, cash flows, access to
finance, or cost of capital over the short-, medium-, or long-term. This included information on
material risks and opportunities attributable to our business relationships.
As part of this process, we leveraged our annual risk assessment process and consulted our risk
management team and senior leadership. We incorporated the inputs of our latest risk assessment
into our DMA through a series of validation exercises and workshops. In the future, we intend
to assess the extent to which our DMA process may be further integrated into and aligned with
our general risk management processes as part of our overall management process. For more
information on our process to identify, assess, prioritize, and monitor risks and opportunities
that may have financial effects, as well as our risk assessment process, see the
Risk and Risk
Management section of the Board report.
Identifying Our Material Impacts, Risks, and Opportunities
Using the definitions for impact and financial materiality described above, we performed our DMA in
the following steps:
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1.
Understand Our Activities, Value Chain and Business Relationships
Developed an overview of our business activities and relationships, including the activities,
products, and services within our own operations as well as our upstream and downstream value
chain across geographies. For more information on our value chain, please see p. 114 of this
Sustainability Statement.
2.
Identify Sustainability Matters
Generated an extensive list of potentially material sustainability matters composed of those listed
in Application Requirement (AR) 16 of ESRS 1, as well as additional matters based on industry and
geographical research, sustainability frameworks and standards, consultation with independent
third-party advisors, and our prior year materiality assessment. In advance of the stakeholder
engagement described in step 3, below, the ESG team, with the guidance and input of each of
the Steering Committee (SteerCo) and an independent third-party consultant, performed an initial
relevance screening of these matters as well as a side-by-side evaluation against the original list
of potentially material matters to review and validate the basis for exclusion for each matter.
3.
Assess Impact and Financial Materiality
Engaged internal and external stakeholders to assess and refine our understanding of UMG’s
IROs from across our activities, business relationships, and geographies. Internal stakeholders
included a broad array of UMG employees across various business units, internal roles, and
geographies, among other factors, who were consulted directly through open-ended interviews.
These stakeholders assessed each of the financial and impact materiality of the potentially
material matters. External stakeholders included artists, shareholders, and distribution partners.
These stakeholders were consulted, by proxy, through interviews and survey questions tailored to
each type of stakeholder. Additionally, the ESG team and SteerCo each performed an independent
assessment of each sustainability matter. The results of all assessment methods were then
consolidated and presented to the SteerCo for review, discussion, and validation, as described
in step 4, below. For more information on our key stakeholders and our methods of stakeholder
engagement, see "Interests and views of stakeholders (SBM-2)" in this Sustainability Statement.
4.
Validate Material Topics
Conducted internal working sessions with senior leadership, the SteerCo, and subject matter
experts to review, analyze, and assess the results of step 3. This process included cross-checking
the results of UMG’s financial risk assessment as described in the Risk and Risk Management
section of the Board report, discussing potential connections between impacts and dependencies
with the risks and opportunities that may arise from those impacts and dependencies, and
evaluating factors that could potentially give rise to a heightened risk of adverse impacts.
Following these working sessions, the SteerCo and ESG team validated and approved a final list
of material topics and underlying IROs. The final list was then presented to the Audit Committee
for review.
Identification of Impacts, Risks, and Opportunities Related to Specific Topical Standards
Climate Change
In addition to our general DMA process described above, our process to identify and assess
climate-related IROs includes assessment of our GHG footprint in accordance with the GHG
Protocol, including scope 1 emissions, scope 2 location-based emissions, scope 2 market-based
emissions; and scope 3 emissions for the following categories: purchased goods and services
(category 1); capital goods (category 2); fuel- and energy-related activities not included in scope 1
or scope 2 (category 3); upstream transportation and distribution (category 4); waste generated in
operations (category 5); business travel (category 6); employee commuting (category 7); downstream
transportation and distribution (category 9); end-of-life treatment of sold products (category
12); franchises (category 14); and investments (category 15). For additional information, see the
Environmental information section of this Sustainability Statement.
In 2022, we conducted our first TCFD-aligned analysis to provide a qualitative review of UMG’s
potential climate-related physical and transition risks, inform strategic planning, and enhance
transparency with respect to climate risk disclosures. The analysis concluded that there were no
climate-related risks resulting in high or critical impact to UMG’s operations or value chain across
the evaluated scenarios and time horizons. The full analysis is available in our TCFD report, as
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presented in our 2023 Annual Report. Relevant sections of the climate scenario analysis have
been included in the Environmental information section of this Sustainability Statement. Since the
analysis was completed, there have been no changes to our business that would materially impact
this analysis.
Other Topical Standards
As described above, as part of our DMA process, we generated an extensive list of potentially
material sustainability matters. This list included potentially material IROs at the sub-topic level,
including for pollution, water and marine resources, biodiversity and ecosystems, resource use and
circular economy, and business conduct. We conducted our DMA as described above and did not
perform additional screening of assets or activities, assessment of site locations, or conduct local
engagement at site locations with respect to these topics. Except as otherwise indicated in this
Sustainability Statement, we did not identify these topics as material.
Because our DMA did not identify biodiversity as a material topic, we do not currently conduct
biodiversity and ecosystems scenario analysis. In the event that our DMA identifies biodiversity as a
material topic in the future, we may conduct such analysis.
Disclosure Requirements in ESRS covered by our sustainability statement (IRO-2)
The following content index indicates the Disclosure Requirements we have identified to be material
as a result of our DMA process, as described above. For an explanation of how we determined the
material information to be disclosed in relation to our identified IROs, see “Description of the process
to identify and assess material impacts, risks, and opportunities (IRO-1)”.
Topical Standard Material Topic ESRS Disclosure Requirement Derived from other
EU legislation
1
Page
ESRS E1
Climate Change
GHG emissions E1-1 Transition plan for climate change mitigation 136
E1-2 Policies related to climate change mitigation and adaptation 136
E1-3 Actions and resources in relation to climate change policies 136
E1-4 Targets related to climate change mitigation and adaptation x 136-137
E1-6 Gross scopes 1, 2, 3 and total GHG emissions x 137-141
E1-7 GHG removals and GHG mitigation projects financed through carbon credits 136
E1-8 Internal carbon pricing 136
ESRS S1
Own Workforce
2
Attraction and retention of employees
Diversity, inclusion and belonging
Gender equality and equal pay
S1-1 Policies related to own workforce x 142
S1-2 Processes for engaging with own workforce and workers’ representatives about impacts 142-143
S1-3 Processes to remediate negative impacts and channels for own workforce to raise concerns x 143
S1-4 Taking action on material impacts on own workforce, and approaches to managing material risks and pursuing material
opportunities related to own workforce, and effectiveness of those actions
143-144
S1-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks
and opportunities
144
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Topical Standard Material Topic ESRS Disclosure Requirement Derived from other
EU legislation
1
Page
S1-6 Characteristics of the undertaking’s employees 144-146
S1-9 Diversity metrics 64, 146
S1-16 Remuneration metrics x 147
ESRS G1
Business Conduct
Supply chain management G1-2 Management of relationships with suppliers 149-150
Entity-specific Attraction and retention of artists Entity-specific Attraction and retention of artists 147-148
Entity-specific Privacy and cybersecurity Entity-specific Privacy and cybersecurity 152
Entity-specific Intellectual property, piracy, and
content protection
Entity-specific Intellectual property, piracy, and content protection 150-152
ESRS 2
General Disclosures
General disclosures BP-1 General basis for preparation of sustainability statements 103
BP-2 Disclosures in relation to specific circumstances 103-104
GOV-1 The role of the administrative, management and supervisory bodies x 105-107
GOV-2 Information provided to and sustainability matters addressed by the undertaking’s administrative, management and supervisory bodies 107
GOV-3 Integration of sustainability-related performance in incentive schemes 107
GOV-4 Statement on due diligence x 110
GOV-5 Risk management and internal controls over sustainability reporting 107
110-111
IRO-1 Description of the process to identify and assess material impacts, risks and opportunities 120-122
IRO-2 Disclosure requirements in ESRS covered by the undertaking’s sustainability statement 122-123
SBM-1 Strategy, business model and value chain 111-114
SBM-2 Interests and views of stakeholders 115-116
SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 117-119
1 The table includes all data points that derive from other EU legislation as listed in ESRS 2 Appendix B, which are material for UMG, indicating where the data points can be found in the report. Other data points which are not included in the table
above, are considered not material.
2 Except as expressly stated otherwise, UMG's material impacts on our own workforce are limited to UMG employees.
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ENVIRONMENTAL INFORMATION
Disclosures pursuant to Article 8 of Regulation 2020/8526 (Taxonomy Regulation)
The European Commission has set ambitious sustainability targets with the overarching aim to be a
net zero continent by 2050. An important component of the EU Action Plan on Sustainable Finance,
which supports this ambition, is to steer cash flows toward sustainable investments.
In accordance with European Regulation 2020/852 of June 18, 2020 and 'Besluit bekendmaking niet-
financiële informatie', UMG is obligated to disclose the Taxonomy-eligible, Taxonomy non-eligible,
and Taxonomy-aligned turnover, capital expenditures, and operating expenditures for economic
activities relating to the Taxonomy's six environmental objectives.
EU Taxonomy Objectives and Scope
The EU Taxonomy Regulation serves as a standardized and mandatory classification system to
determine which economic activities are considered environmentally sustainable in the EU. The
results of this classification are reported annually on a company-specific basis.
Article 9 of the EU Taxonomy regulation identifies six (6) environmental objectives:
1.
Climate change mitigation (CCM)
2.
Climate change adaption (CCA)
3.
Sustainable use and protection of water and marine resources (WTR)
4.
Transition to a circular economy (CE)
5.
Pollution prevention and control (PPC)
6.
Protection and restoration of biodiversity and ecosystems (BIO)
Regarding the classification of an activity as environmentally sustainable, the EU Taxonomy
Regulation distinguishes between Taxonomy-eligible and Taxonomy-aligned activities:
■
Activities are Taxonomy-eligible if they match the description of the activity included in Delegated
Acts supplementing Regulation (EU) 2020/852 of the European Parliament, irrespective of whether
they fulfill the alignment criteria.
■
Activities are Taxonomy-aligned if they fulfill the technical screening criteria for the activity. In
this case, they make a substantial contribution to the respective environmental objective (fulfill
the substantial contribution criteria), cause no significant harm to any of the other environmental
objectives (Do No Significant Harm, DNSH), and observe and comply with the minimum safeguards
for human rights, corruption, taxation, and fair competition (MS).
EU Taxonomy disclosure requirements for 2024 reporting are:
■
The proportion of Taxonomy-eligible, Taxonomy non-eligible and Taxonomy-aligned economic
activities in Key Performance Indicators (as identified in Delegate Regulation (EU) 2021/2139,
Delegated Regulation (EU) 2022/1214, Delegated Regulation (EU) 2023/2485, and Delegated
Regulation (EU) 2023/2486.
■
Qualitative information relevant for disclosures, including accounting policy, assessment of
compliance with Regulation (EU) 2020/852, and contextual information about KPIs (Disclosures
Delegate Act (EU) 2021/2178, Article 10).
Accounting Policies
The table on the following page provides the basis for the numerator and denominator of EU
Taxonomy-eligibility and alignment for Turnover, CapEx, and OpEx as defined in the Delegated
Regulation (EU) 2021/2178 (Annex I, Section 1.1).
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Turnover CapEx
1
OpEx
1
Numerator Revenue derived
from products and/or
services associated
with EU Taxonomy-
eligible/aligned activities.
Capital expenditures that are
related to assets or processes
associated with EU taxonomy-
eligible/aligned activities.
Operating expenses that are
related to assets or processes
associated with EU Taxonomy-
eligible/aligned activities.
Denominator Revenue recorded in
the consolidated financial
statements under IFRS as
per Revenue Accounting
policy described in
the consolidated
financial statements.
Additions to tangible and
intangible assets recorded
in the consolidated financial
statements under IFRS
during the financial year,
considered before depreciation,
amortization, and any re-
measurements.
Direct non-capitalized costs
recorded in the consolidated
financial statements under IFRS
that relate to R&D, building
renovation measures, short-term
leases, maintenance and repair
(excluding expenses reported as
cost of sales), and any other direct
expenditures relating to the day-to-
day servicing of PPE assets.
1
There are no capital or operating expenditures related to a capital plan or purchase of output
from Taxonomy-aligned economic activities such as individual measures enabling target activities
to become low-carbon, activities leading to GHG emissions reductions, or individual renovation
measures planned to be implemented and operational within eighteen (18) months.
The financial information for calculating the metrics was gathered from UMG’s financial reporting
system, excluding intercompany transactions. Eligible economic activities are identified for CapEx
KPI, under CCM and CE objectives. Where an activity contributes to several environmental objectives,
UMG includes all activity codes, and highlights the most relevant one in bold. UMG considers the
allocation of revenues and expenditures to the numerator for only one environmental objective per
objective, to avoid double counting.
In 2024, UMG did not issue sustainability-linked bonds or debt securities.
Assessment of Compliance with Regulation (EU) 2020/852
For 2024, UMG assessed eligibility and alignment under each KPI and concludes as follows, with
subsequent explanations for each KPI.
■
Turnover: No revenue activities are considered eligible and therefore also not aligned.
■
CapEx: Taxonomy-eligible CapEx is calculated at 23%, however, it does not meet the substantial
contribution criteria, and therefore Taxonomy-aligned CapEx is 0%.
■
OpEx: Taxonomy OpEx is calculated at 1% of the total cost of sales and is not considered material.
Turnover KPI
The basis of the turnover KPI covers UMG business activities as of December 31, 2024. The turnover
denominator is reconciled with the revenue recorded in Note 3 of the Consolidated Financial
Statements under IFRS as per the revenue accounting policy described in the Notes to the
Consolidated Financial Statements. It consists of revenue from Recorded Music, Music Publishing,
Merchandising, and Other.
Eligibility Assessment
Management analyzed the activities 13.1. Creative, arts and entertainment activities, and 13.3.
Motion picture, video and television programme production, sound recording and music publishing
activities considering EU Taxonomy Regulation text, the EU Taxonomy Climate Delegated Act,
including supplemental notices in the form of FAQs, approved by the EU Commission, publications
by the Platform on Sustainable Finance, and peer disclosures to test whether these activities should
be considered eligible under CCA objective. Based on the EU Commission notice C/2023/305 these
activities are considered as “adapted-enabling activities” and require becoming adapted themselves
(adapted activity) and enabling other activities to make a substantial contribution (enabling activity).
UMG has not carried out a climate risk and vulnerability assessment to evaluate the adapted
activity criteria. However, UMG’s Turnover activities, sound recording and music publishing, do
not directly enable other activities to make a substantial contribution. Therefore, even if UMG’s
Turnover activities were to be adapted in the future, the criteria for enabling activity would not be
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SUSTAINABILITY STATEMENT
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met. Management continues to monitor relevant developments and guidance and will revisit this
analysis as new information becomes available. Based on the performed analysis, UMG’s eligible
Turnover, CapEx or OpEx in relation to the environmental objective CCA amounts to zero.
The percentage for Taxonomy-eligible Turnover amounts to zero. There are no Turnover activities
eligible and assessed for alignment.
CapEx KPI
Under the EU Taxonomy Regulation, the total CapEx covers additions to tangible and intangible
assets during the financial year considered before depreciation, amortization, and any re-
measurements recognized by UMG according to IAS16, IFRS16, and IAS38, including those resulting
from revaluations and impairments for the relevant financial year and excluding fair value changes.
Total CapEx (denominator) can be reconciled with the sum of the lines ’Additions’ disclosed in Note
10 Changes in content assets and other intangibles (excluding royalty advances), Note 11 Property,
Plant and Equipment (PPE), and Note 12 Leases within the consolidated financial statements.
Eligibility Assessment
For UMG, most of the CapEx relates to additions to catalogs and other intangibles, which are not
eligible. The eligible CapEx comes from the capitalized cost of renovations and leased assets (EU
Taxonomy activities under CCM: 7.2 Renovation of existing buildings, 7.7 Acquisition and ownership
of buildings, and CE: 3.2 Renovation of existing buildings.).
The breakdown by type of eligible CapEx is as follows:
(in millions of euros)
CCM 7.2, CE 3.2
Renovation of
existing buildings
1
CCM 7.7
Acquisition and
ownership of buildings
2024 2023 2024 2023
Additions to PPE, leases, and intangible assets 56 40 85 46
Acquisitions through business combinations 0 0 0 0
Expenses incurred for Taxonomy-aligned activities and
as part of CapEx plan
0 0 0 0
Total Taxonomy-eligible CapEx 56 40 85 46
1 To avoid double counting, the most relevant activity (CCM 7.2) has been indicated in bold.
Alignment Assessment
7.2 and 3.2 Renovation of existing buildings
UMG has assessed the substantial contribution criteria and evaluated that the leasehold
improvements are conducted to meet UMG's business needs and do not meet the substantial
contribution criteria for CCM under Activity 7.2, and CE under Activity 3.2.
7.7 Acquisition and ownership of buildings
For 2024, ten (10) leased locations were identified as eligible under the substantial contribution
criteria for CCM. While UMG developed a validation approach using internationally recognized energy
certificates and primary energy demand (PED) measures, there was insufficient national and regional
data for the ten (10) locations to determine energy performance. Therefore, the new leases did not
meet the energy performance requirements under substantial contribution criteria for CCM and are
not further assessed for alignment.
The percentage for Taxonomy-aligned CapEx amounts to zero.
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SUSTAINABILITY STATEMENT
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OpEx KPI
The OpEx denominator includes direct, non-capitalized costs for research and development
expenses, building renovation measures, short-term leasing, maintenance and repair expenses, and
any other direct expenditure relating to the day-to-day servicing of assets of property, plant, and
equipment necessary to ensure the continued and effective functioning of such assets.
For UMG, most of the Taxonomy OpEx relates to the maintenance of buildings, assets used in
business operations, and short-term leases.
The nature of UMG’s business model relates to people and the arts and is not centered around
tangible assets. In 2024, UMG calculated Taxonomy OpEx at 1% of the total of selling, general and
administrative expenses and cost of revenues. Management concludes that Taxonomy OpEx is not
material for UMG’s business model. UMG makes use of the materiality exemption per the Disclosure
Delegated Act Annex I, Section 1.1.3.2, doesn’t assess eligibility and alignment of OpEx, and discloses
the numerator as equal to zero.
EU Taxonomy KPI Disclosure Tables
The KPI tables below summarize the outcome of UMG’s Turnover, CapEx and OpEx assessment.
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Proportion of Turnover from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2024
Financial year 2024 Year Substantial Contribution Criteria
DNSH criteria (“Does Not Significantly
Harm”) (
h
)
Economic Activities (1)
Code
(2)*
Turnover
(3)
Proportion of Turnover, year 2024 (4)
Climate Change Mitigation (5)
Climate Change Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change Mitigation (11)
Climate Change Adaptation (12)
Water (13)
Pollution (14)
Circular Economy (15)
Biodiversity (16)
Minimum Safeguards (17)
Proportion
of
Taxonomy
aligned
(A.1.) or
-eligible
(A.2.)
turnover,
year 2023
(18)
Category
enabling
activity
(19)
Category
transitional
activity
(20)
Text
millions
of euros
%
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
No activities N/A € 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% N/A N/A
Turnover of environmentally sustainable activities (Taxonomy-aligned) (A.1) € 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A N/A 0%
Of which enabling € 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A N/A 0% E
Of which transitional € 0 0% 0% N/A N/A N/A N/A N/A N/A N/A 0% T
A.2. Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (
g
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
No activities N/A € 0 0% N/A N/A N/A N/A N/A N/A 0%
Turnover of Taxonomy-eligible but not environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2)
€ 0 0% 0% 0% 0% 0% 0% 0% 0%
A. Turnover of Taxonomy eligible activities (A.1 + A.2) € 0 0% 0% 0% 0% 0% 0% 0% 0%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities € 11,834 100%
TOTAL € 11,834 100%
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Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2024
Financial year 2024 Year Substantial Contribution Criteria
DNSH criteria (“Does Not Significantly
Harm”) (
h
)
Economic Activities (1)
Code
(2)*
CapEx
(3)
Proportion of CapEx, year 2024 (4)
Climate Change Mitigation (5)
Climate Change Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change Mitigation (11)
Climate Change Adaptation (12)
Water (13)
Pollution (14)
Circular Economy (15)
Biodiversity (16)
Minimum Safeguards (17)
Proportion
of
Taxonomy
aligned
(A.1.) or
-eligible
(A.2.)
CapEx, year
2023 (18)
Category
enabling
activity
(19)
Category
transitional
activity
(20)
Text
millions
of euros
%
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
No activities N/A € 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% N/A N/A
CapEx of environmentally sustainable activities (Taxonomy-aligned) (A.1) € 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A N/A 0%
Of which enabling € 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A N/A 0% E
Of which transitional € 0 0% 0% N/A N/A N/A N/A N/A N/A N/A 0% T
A.2. Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (
g
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
Renovation of existing buildings CCM 7.2/ CE 3.2 € 56 9% EL N/EL N/EL N/EL EL N/EL 8%
Acquisition and ownership of buildings CCM 7.7 € 85 14% EL N/EL N/EL N/EL N/EL N/EL 9%
CapEx of Taxonomy-eligible but not environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
€ 141 23% 100% 0% 0% 0% 0% 0% 17%
A. CapEx of Taxonomy eligible activities (A.1 + A.2) € 141 23% 100% 0% 0% 0% 0% 0% 17%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
CapEx of Taxonomy-non-eligible activities € 479 77%
TOTAL € 620 100%
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Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2024
Financial year 2024 Year Substantial Contribution Criteria
DNSH criteria (“Does Not Significantly
Harm”) (
h
)
Economic Activities (1)
Code
(2)*
OpEx (3)
Proportion of OpEx, year 2024 (4)
Climate Change Mitigation (5)
Climate Change Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change Mitigation (11)
Climate Change Adaptation (12)
Water (13)
Pollution (14)
Circular Economy (15)
Biodiversity (16)
Minimum Safeguards (17)
Proportion
of
Taxonomy
aligned
(A.1.) or
-eligible
(A.2.) OpEx
year 2023
(18)
Category
enabling
activity (19)
Category
transitional
activity (20)
Text
millions
of euros
%
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y; N; N/EL
(
b
) (
c
)
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
No activities N/A € 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% N/A N/A
OpEx of environmentally sustainable activities (Taxonomy-aligned) (A.1) € 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A N/A 0%
Of which enabling € 0 0% 0% 0% 0% 0% 0% 0% N/A N/A N/A N/A N/A N/A N/A 0% E
Of which transitional € 0 0% 0% N/A N/A N/A N/A N/A N/A N/A 0% T
A.2. Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (
g
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
EL; N/EL
(
f
)
No activities N/A € 0 0% N/A N/A N/A N/A N/A N/A 0%
OpEx of Taxonomy-eligible but not environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
€ 0 0% 0% 0% 0% 0% 0% 0% 0%
A. OpEx of Taxonomy eligible activities (A.1 + A.2) € 0 0% 0% 0% 0% 0% 0% 0% 0%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpEx of Taxonomy-non-eligible activities € 108 100%
TOTAL € 108 100%
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Proportion of OpEx/Total OpEx
Taxonomy-aligned
per objective
Taxonomy-eligible
per objective
CCM 0% 0%
CCA 0% 0%
WTR 0% 0%
CE 0% 0%
PPC 0% 0%
BIO 0% 0%
Proportion of CapEx/Total CapEx
Taxonomy-aligned
per objective
Taxonomy-eligible
per objective
CCM 0% 23%
CCA 0% 0%
WTR 0% 0%
CE
1
0% 0%
PPC 0% 0%
BIO 0% 0%
1 UMG has 9% of activities that are eligible to make a substantial contribution
for both CCM 7.2 and CE 3.2. To avoid double counting, only activities for the
most relevant activity (CCM 7.2), are included in the table.
Proportional overview of KPIs
Proportion of Turnover/Total Turnover
Taxonomy-aligned
per objective
Taxonomy-eligible
per objective
CCM 0% 0%
CCA 0% 0%
WTR 0% 0%
CE 0% 0%
PPC 0% 0%
BIO 0% 0%
Row Fossil gas related activities No
4. The undertaking carries out, funds or has exposures to construction or operation of electricity generation
facilities that produce electricity using fossil gaseous fuels.
No
5. The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined
heat/cool and power generation facilities using fossil gaseous fuels.
No
6. The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat
generation facilities that produce heat/cool using fossil gaseous fuels.
No
Prospects
Not all sustainability efforts are recognized yet under the EU Taxonomy Regulation. For more
information about UMG’s sustainability initiatives, including our commitment to support industry
transformation and the validation of our science-based targets, see Climate Change (E1) in
Environmental information section of this Sustainability Statement.
Management is committed to monitoring EU Taxonomy developments closely and to assessing new
requirements as the basis for UMG's annual disclosures.
Nuclear and fossil gas related activities
Row Nuclear energy related activities No
1. The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of
innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from
the fuel cycle.
No
2. The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear
installations to produce electricity or process heat, including for the purposes of district heating or industrial
processes such as hydrogen production, as well as their safety upgrades, using best available technologies.
No
3. The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that
produce electricity or process heat, including for the purposes of district heating or industrial processes such as
hydrogen production from nuclear energy, as well as their safety upgrades.
No
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Climate change (E1)
Climate scenario analysis (E1.IRO-1, E1.SBM-3)
In connection with our TCFD-aligned analysis in 2022, UMG conducted a climate scenario analysis
by applying multiple, varying future emissions scenarios to allow a comprehensive exploration of
risks and opportunities for the business. Four climate scenarios from two leading organizations,
the Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency (IEA),
were selected to provide consistency and comparability in the analyses and disclosure. We note
that these scenarios are subject to inherent assumptions and uncertainties, including uncertainty
regarding the ways in which these scenarios will develop.
For transition risks and opportunities, UMG applied:
■
A low emissions, net-zero aligned scenario of 1.5°C temperature rise (IEA Net Zero by 2050)
For physical risks, UMG applied:
■
A low emissions scenario of 1.8°C temperature rise (IPCC SSP1-2.6)
■
A mid-range scenario of 2.7°C temperature rise (IPCC SSP2-4.5)
■
A worst-case scenario of 4.6°C temperature rise (IPCC SSP5-8.5)
For each scenario, three time horizons were considered:
■
Short-term (2023-2026)
■
Medium-term (2027-2034)
■
Long-term (2035-2050)
These time horizons were defined in accordance with IPCC and IEA scenario analyses in order to
evaluate direct impacts of the climate and weather system on UMG's facilities and potential impacts
of carbon prices and supply chain readiness on UMG's business. Our science-based targets are
aligned with these time horizons. We note that these time horizons differ from those used in our
DMA process, which were defined in accordance with ESRS 1. For more information, see "Disclosures
in relation to specific circumstances (BP-2)" in the
ESRS 2 General information section of this
Sustainability Statement.
Climate-related risks were identified and assessed in terms of exposure level and severity. UMG’s
business resiliency and existing mitigation measures were also considered to determine the
business impact for each risk. Risks that have a low impact imply that these are already sufficiently
managed as part of existing processes and/or UMG’s exposure level is low. Risks identified with
higher impact may require additional mitigation or adaptation strategies.
Each risk was assessed based on three criteria:
■
Likelihood of occurrence: determined for each time frame, estimated based upon current
trajectory of regional and global developments.
■
Severity of impact: potential worst-case influence of the hazard independent of likelihood and
assuming no relevant business, strategy, and financial planning.
■
Existing resiliency measures: based on the current resiliency measures in place including
relevant business, strategy, and financial planning.
The levels of impact are defined as follows:
■
Low impact: risks are managed as part of existing processes.
■
Moderate impact: risks require additional adaptation planning and mitigation responses.
■
High impact: risks are likely to require significant pivot of business strategy or
operational protocols.
■
Critical impact: risks require major pivot to business, strategy, or financial planning.
The impact assessment of UMG’s risks identified only Low and Moderate-level impacts. There
were no risks resulting in High or Critical impact to UMG’s operations across all scenarios and
time horizons. Climate-related opportunities were also identified to highlight potential benefits to
UMG’s profitability and reputation. The list of Transition Risks, Physical Risks, and Climate-related
Opportunities may be found in Tables 1, 2, and 3 below, respectively.
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For more information on results of the assessment and impact on business, see "Identification of
Impacts, Risks, and Opportunities Related to Specific Topical Standards, Climate Change" in the
ESRS 2 General information section of this Sustainability Statement.
Table 1 - Transition Risks
Category Risk Short Medium Long
Policy & Legal
Increased overall operational costs due to direct GHG emissions related compliance and other indirect effects of regulations.
The introduction of GHG emissions reporting requirements, mandated emissions reductions requirements, and/or mandatory carbon pricing in regions where UMG operates,
may result in increased operational costs of data collection or resources required to comply with GHG emissions requirements. Additional indirect policy & regulation may
lead to financial and/or reputational consequences — both the EU and the U.S. have proposed laws and/or documentation updates to restrict the use of unsubstantiated
claims around product or company sustainability (e.g., greenwashing or green labeling), and may require that companies show evidence against standard frameworks or
requirements for any claims that are made.
Low Moderate Moderate
Policy & Legal
Financial, legal, and reputational impacts from any failure or alleged failure to comply with climate-related laws or regulations.
Failure to comply with climate-related laws or regulations may result in fines and affect UMG’s ability to sell products and services or operate in specific markets. It may also
deteriorate UMG’s brand perception. In the EU specifically, penalties for noncompliance include public declaration of noncompliance and administrative financial sanctions.
Low Low Low
Policy & Legal
Impact on operational efficiencies and financial burden due to regional differences in regulations across regions.
Due to the vast nature of the global regulatory landscape, UMG may be required to align with multiple regulations. This may require additional resources and operational
adjustments to comply. Specifically, when comparing U.S. and EU regulations, there are varying levels of disclosure related to scope 3 emissions and differing requirements
around materiality assessments. For example, the State of California will be requiring all plastic packaging to be recyclable or compostable by 2032, while the UK instituted a
plastic packaging tax, and the EU is requiring increased recyclability of plastic packaging. These differences and potential conflicts in regional regulations pose an operational
and financial risk.
Low Low Low
Technology/
Market
Increased costs to transition to more sustainable materials and technologies.
Shifting to increasingly sustainable alternative materials and manufacturing processes for UMG’s products may increase capital and operational costs. This shift may arise
from changing consumer and artist demand toward sustainable products and may also affect UMG’s revenue from physical products.
Low Moderate Moderate
Reputation
Reputational or legal implications around failure to meet environmental targets or other sustainability goals
.
UMG has set near-term science-based targets. Inability to act or lack of progress toward this or other voluntary or mandated sustainability goals, including making misleading
claims (e.g., greenwashing or green labeling), may impact shareholder and stakeholder concerns in material ESG topic areas, such as attraction and retention of artists and
employees. Customer brand perception may also be adversely affected, which can influence UMG’s ability to sell products and services and may erode shareholder value.
Low Low Moderate
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Table 2 – Physical Risks
Time Horizon
Category Risk Short Medium Long
Acute/Chronic
Business interruption and increased CapEx due to physically damaged facilities and production shutdowns.
Climate events and storms may cause business interruption losses and increased CapEx due to physically damaged facilities, personal injuries
of employees, interruption of energy power systems, and shutdowns leading to production interruption and inability to respond to demand for an
indefinite period.
Low/ Moderate
depending
on hazards
Low/ Moderate
depending
on hazards
Low/ Moderate
depending
on hazards
Acute/Chronic
Impact on operations due to disruptions in the supply chain.
Disruptions in the supply chain due to climate-related events may impact UMG as we are highly dependent on our suppliers to meet the needs of
stakeholders. If significant disruptions occur in the supply chain, UMG may be at risk of revenue loss and reputational issues resulting from stakeholder
expectations not being met. Customer brand perception may also be adversely affected which can influence UMG’s ability to sell our products and services
and may erode shareholder value.
Moderate Moderate Moderate
Acute
Increased operational costs from cooling load.
Higher average temperatures and increased frequency of heat waves as a result of climate change may require an increased need for cooling for the
safety of UMG’s workforce and preservation of products and equipment, leading to higher operational costs.
Low Low Moderate
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Table 3 - Transition Opportunities & Time Horizons
Category Opportunity Time Horizon
Resource
Efficiency
Decreased operational costs from resource efficiency.
Investing in updated assets and technology may result in reduced operational costs, improved energy efficiency of facilities, decreased energy usage, and reduced
emissions for UMG. Across our global portfolio, UMG continues to pursue powering our global portfolio with electricity from renewable sources. In addition, UMG actively
pursues internationally recognized environmental certifications, such as BREEAM, LEED, and ENERGY STAR.
Medium- to long-term
Energy Source
Decreased operational costs from switching to renewable energy sources.
Shifting to renewable energy sources such as wind and solar may result in financial savings and emissions reductions. Experts anticipate that renewable energy rates will
follow a downward trend as access to renewable generation increases and fossil fuels become more expensive.
Short- to long-term
Products
and Services
Increased revenue from sustainable products and services.
Investing in and helping to advance sustainability-related research (including finding alternatives to energy intensive distribution modes and products), may allow UMG to
get ahead of trends, innovate, and develop more sustainable products and services (e.g., increased regional sourcing, using a higher percentage of reground vinyl, designing
eco-friendly packaging, developing an alternative to jewel cases, and circular opportunities to reduce product waste), and drive demand for these products, leading to
increased revenues and positive reputational impacts.
Medium- to long-term
Market
Increased revenue from stakeholder engagement and collaboration.
Engaging with stakeholders on sustainability initiatives may increase positive perception of UMG compared to competitors and position our artists and labels as a
sustainable and responsible choices. Pursuing collaboration opportunities (with peers, artists, partners, and vendors) may also create more sustainable processes and
products for the industry as a whole and help to drive wider behavioral change with respect to the cultural norms, thinking, and politics surrounding climate change.
Medium- to long-term
Market
Decreased supply chain disruption due to sustainability engagement.
Engaging vendors to increase sustainability and transparency through the supply chain may result in decreased emissions and build resilience against potential physical
climate risks. For UMG, this may include incorporating sustainability criteria into third party management processes from RFP through contract language and inviting our tier
one strategic partners to set science-based targets.
Medium- to long-term
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The analysis was extended to the value chain by assessing the climate maturity for six key suppliers.
Three of these suppliers were observed to be advanced in their climate-risk consideration. Those
requiring additional engagement and communication to align with and support UMG’s climate goals
were also identified. UMG may model future value chain engagement strategies on successful efforts
working with our top suppliers on sustainability topics.
Climate change requires collective action. We believe that our purpose, to shape culture through
the power of artistry, includes supporting collective action on climate change. Achieving reductions
in our own GHG emissions is an important demonstration of our commitment to meaningful
change. To support this commitment, we measure and mitigate our environmental footprint, as
discussed below.
Transition plan, policies, and key actions (E1-1, E1-2, E1-3, E1-7, E1-8)
UMG is developing a climate transition plan, which we aim to adopt by 2027. UMG has not yet
established formal climate change mitigation and adaptation policies or actions, as these will be
developed as part of our climate transition plan. The initial steps we have taken in laying the
groundwork for the development of our climate transition plan include:
■
We conducted our first TCFD-aligned analysis in 2022 (see “Identification of impacts, risks, and
opportunities related to specific topical standards”);
■
We set science-based targets which were approved by the Science-Based Targets initiative (SBTi)
in 2023, aligned with limiting global warming to 1.5°C (see “Science-based targets”, below);
■
We continued to meet with ESG working groups to collaborate on initiatives related to our
material scope 3 categories and supply chain engagement (for more information on our
ESG working groups, see the “Sustainability Management: Roles & Responsibilities” in the
Corporate Governance section of the Board report and “Supply Chain Management” in this
Sustainability Statement);
■
We continued to engage with key stakeholders to evaluate activities that could have an impact on
actual and potential future GHG emissions; and
■
We continued our renewable energy transition analysis in partnership with Procurement in 2024.
We are in the process of refining our overarching environmental strategy. We intend to adopt an
environmental policy that aligns with and supports this overall strategy in 2025.
UMG does not have internal carbon pricing schemes, GHG removals and storage, or GHG
mitigation projects financed through carbon credits. UMG is not excluded from the EU Paris-
aligned Benchmarks.
Targets related to climate change mitigation and adaptation (E1-4)
In 2023, UMG became the first major standalone music company to announce science-based targets
approved by the SBTi. We committed to reduce:
■
Absolute scope 1 and 2 GHG emissions 58% by 2032 from a 2019 base year, an ambition which is in
line with a 1.5°C trajectory; and,
■
Scope 3 GHG emissions from purchased goods and services, capital goods, fuel- and energy-
related activities, upstream transportation and distribution, waste generated in operations,
business travel, and employee commuting by 62% per EUR value added
1
within the
same timeframe.
UMG’s ESG team developed the science-based targets based on the GHG Protocol and the SBTi Criteria
and Recommendations Version 5.0
2
. Our science-based targets cover all seven GHGs, where relevant:
carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons
(PFC), sulfur hexafluoride (SF6), and nitrogen trifluoride (NF3). Our science-based targets are aligned
with the boundaries of our GHG Inventory (see “GHG emissions methodology”, below) – we ensure
this consistency by following the GHG Protocol for our emissions calculations and target-setting
process, and through the SBTi validation. Our science-based targets align with the climate scenario
1
“Value added“ is defined as EBITDA plus all personnel costs. EBITDA is defined in the Appendix to the Annual Report.
2
SBTi Criteria and Recommendations V5.0
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laid out in the Paris Agreement – limiting global warming to 1.5°C above pre-industrial levels. Our
science-based targets were not derived using a sectoral decarbonization approach.
With regard to our target base year, the SBTi allows flexibility in base year selection to consider
circumstances that may make a given year's emissions unrepresentative. At the time of our
assessment, UMG considered 2019 as the most representative year of normal operations prior
to the effects of the COVID-19 pandemic, so we selected 2019 as the base year for our science-
based targets.
UMG reports our scope 1, 2, and 3 emissions and our progress towards achieving our science-
based targets annually (see “Science-based targets progress” and “Gross scopes 1, 2, 3 and total
GHG emissions”, below). UMG is developing the expected decarbonization levers and their overall
quantitative contributions to achieve our science-based targets as part of our climate transition
plan. We have not set 2030 emissions reduction targets as our SBTi approved targets were set in
advance of the implementation of the CSRD.
Science-based targets progress (E1-4)
Target
Base Year
2019 2024
Reduction
from
2019-2024
Reduction
Target
by 2032
Scope 1 & 2 (market-based) (absolute tCO
2
e) 11,454 8,265 -28% -58%
Scope 3 (tCO
2
e per million
EUR value added)
1,2
200 124 -38% -62%
1 Our scope 3 target covers the following emissions categories: purchased goods and services, capital goods, fuel- and
energy-related activities, upstream transportation and distribution, waste generated in operations, business travel, and
employee commuting.
2 “Value added“ is defined as EBITDA plus all personnel costs. EBITDA is defined in the Appendix to the Annual Report.
GHG emissions methodology (E1-6)
Overview
UMG follows the GHG Protocol, a globally recognized framework for measuring and reporting
emissions. Our GHG inventory includes our relevant scope 1, scope 2 location-based, scope 2
market-based, and scope 3 emissions sources.
Reporting scope
The reporting scope for scope 1 and 2 emissions is primarily driven by the status of UMG’s owned
and leased properties. In 2024, the reporting scope applied to 57 countries and 177 properties, which
represents 98% of our property portfolio and all properties where there is employee headcount.
Properties in scope for environmental reporting include UMG offices, studios, and facilities with
active leases in the reporting year. Properties are considered out of scope if they meet one of the
following criteria: the property closed prior to the reporting year and UMG does not have an active
lease; the property is under construction; or the property is land.
UMG collects actual global data for our scope 3 emissions to the fullest extent possible. For a limited
number of subcategories, global data collection is infeasible. For these subcategories, UMG collects
data from our top five territories (United States, United Kingdom, Japan, Germany, and France) and
estimates for rest of world emissions.
Methodology
Scope 1 emissions are direct GHG emissions that occur from sources that are owned or controlled
by UMG. This includes emissions from the consumption of natural gas and domestic heating fuel,
the leakage of refrigerants during normal air-conditioning operation, and consumption of fuel from
mobile sources, such as directly owned vehicles and vehicles on long-term leases. Emission factors
were obtained from the UK Department for Energy Security and Net Zero (DESNZ)/Department for
Business, Energy & Industrial Strategy (BEIS) Conversion Factors.
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Scope 2 emissions are indirect GHG emissions resulting from the use of purchased electricity,
steam/imported heat, and cooling. As per the GHG Protocol, UMG considers both location-based and
market-based scope 2 emissions:
■
Scope 2 location-based method reflects the average emissions intensity of grids on which
energy consumption occurs. These emissions are calculated based on the grid emissions
factor for the geographic location of the site from which electricity, steam/imported heat, or
cooling is purchased. Emission factor sources include International Energy Agency (IEA) Emission
Factors, United States Environmental Protection Agency (EPA) eGrid Factors, and DESNZ/BEIS
Conversion Factors.
■
Scope 2 market-based method reflects emissions from electricity that UMG has specifically
chosen, including the use of certified renewable electricity through contractual instruments or
onsite generation. Emission factor sources include IEA Emission Factors, DESNZ/BEIS Conversion
Factors, Association of Issuing Bodies Residual Mix (AIB) Factors, and Green-e Residual Mix
Factors. In the case of the supplier sourcing energy from renewable sources, the emission factor
applied is 0 kgCO
2
e/kWh.
Scope 3 includes external indirect GHG emissions from non-owned sources within UMG’s value
chain. These include emissions from the following scope 3 categories:
■
Purchased goods and services (category 1) includes all upstream (i.e., cradle-to-gate) emissions
from the production of products purchased or acquired by UMG in the reporting year. This
category includes emissions associated with indirect spend across our global operations that
are not otherwise captured in UMG’s GHG Inventory; manufacturing of physical audio and
merchandise products; use of third-party recording studios; use of third-party cloud service
providers; and consumption of water at UMG properties. Emissions were calculated using the
supplier-specific method, hybrid method, and spend-based method. Emission factor sources
include the CEDA EEIO database, ecoinvent LCA database, and DESNZ/BEIS Conversion Factors.
■
Capital goods (category 2) includes all upstream emissions from the production of capital goods
purchased or acquired by UMG in the reporting year. Emissions were calculated using the spend-
based method and emission factors were obtained from the CEDA EEIO database.
■
Fuel- and energy-related activities (category 3) includes emissions related to the production of
fuels and energy purchased and consumed by UMG in the reporting year that are not included
in scope 1 or scope 2. This category is comprised of well-to-tank (WTT) and transportation and
distribution (T&D) loss emissions. Emissions were calculated using the fuel-based method and
emission factors were obtained from DESNZ/BEIS Conversion Factors and IEA Emission Factors.
■
Upstream transportation and distribution (category 4) includes emissions related to the
transportation and distribution of products purchased by UMG between our tier 1 suppliers
and own operations in vehicles and facilities not owned or controlled by the reporting
company. Additionally, this category includes emissions related to third-party transportation
and distribution services purchased by UMG in the reporting year (either directly or through
an intermediary), including inbound logistics, outbound logistics, and third-party transportation
and distribution between our own facilities. Emissions are calculated using the distance-based
method and emission factors were obtained from the DESNZ/BEIS Conversion Factors. Emissions
calculated include both WTT and tank-to-wake (TTW) emissions, and account for the effects of
radiative forcing in air freight.
■
Waste generated in operations (category 5) includes emissions from third-party disposal and
treatment of waste that is generated in UMG’s owned or controlled operations in the reporting
year. This category includes general waste generated at our owned and leased properties,
electronic waste reported by our third-party treatment provider, and Bravado merchandise scrap
waste collected by our third-party recycling partner. Emissions were calculated using the waste-
type-specific method and emission factors were obtained from DESNZ/BEIS Conversion Factors.
■
Business travel (category 6) includes emissions from the transportation and lodging of UMG
employees for business-related activities in vehicles or assets owned or operated by third parties.
This category includes air, road, rail, business jet, and hotel activity that is booked by UMG across
our global operations; artist travel that is booked by an artist management company is excluded
from these calculations. Emissions were calculated using the distance-based method and spend-
based method, and emission factors were obtained from DESNZ/BEIS Conversion Factors and the
CEDA EEIO database.
■
Employee commuting (category 7) includes emissions from the transportation of UMG employees
between their home and their worksites. This category includes emissions related to the
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commuting of employees across UMG’s global operations. Emissions were calculated using the
average data method and distance-based method, and emission factors were obtained from
DESNZ/BEIS Conversion Factors.
■
Downstream transportation and distribution (category 9) includes emissions from the
transportation and distribution of products sold by UMG in the reporting year between our
operations and retail stores (if not paid for by UMG), in vehicles and facilities not owned or
controlled by UMG. This calculation is currently classified as a “screening” due to the high
level of estimation utilized due to limited data availability (see “Value chain estimation, sources
of estimation, and outcome uncertainty”). Emissions were calculated using the average data
method and distance-based method, and emission factors were obtained from DESNZ/BEIS
Conversion Factors.
■
End-of-life treatment of sold products (category 12) includes emissions from the waste disposal
and treatment of products sold by UMG in the reporting year, at the end of their life. The category
includes the total expected end-of-life emissions from all physical audio and merchandise
products sold in the reporting year. Emissions were calculated using the waste-type-specific
method and emission factors were obtained from DESNZ/BEIS Conversion Factors.
■
Franchises (category 14) includes emissions associated with UMG’s licensing of sold
merchandise. This calculation is currently classified as a “screening” due to the high level
of estimation utilized due to limited data availability (see “Value chain estimation, sources of
estimation, and outcome uncertainty”). Emissions were calculated using the spend-based method
and emission factors were obtained from the CEDA EEIO database.
■
Investments (category 15) includes emissions associated with the UMG’s investments in the
reporting year that are not included in scope 1 or scope 2. This calculation is currently classified
as a “screening” due to the high level of estimation utilized due to limited data availability
(see “Value chain estimation, sources of estimation, and outcome uncertainty”). Emissions were
calculated using the spend-based method and emission factors were obtained from the CEDA
EEIO database.
The following scope 3 categories are excluded from our GHG inventory because they are not relevant
to UMG:
■
Upstream leased assets (category 8) - emissions from leased assets are reported in scope 1 and
scope 2.
■
Processing of sold products (category 10) - UMG does not sell intermediate products.
■
Use of sold products (category 11) - UMG does not sell products with direct use-phase emissions.
■
Downstream leased assets (category 13) - UMG does not lease assets to other entities.
Estimations
For our GHG emissions calculations, data is generally requested for Q1-Q3 and estimates are applied
for Q4 to allow time for data validation, consolidation, and reporting. Estimation of emissions follows
one of the two methodologies:
1.
Historical Average: uses quarterly activity data for previous years to calculate the historical
average ratio of total Q1-Q3 to Q4 activity data. This ratio is then applied to the Q1-Q3 activity
data in the current year to estimate for Q4.
2.
Current Year Average: estimates Q4 activity volume using the average quarterly activity volume for
Q1-Q3 in the current year.
The Historical Average method
1
accounts for seasonal differences in business activity and is applied
when data is available at quarterly granularity, at a minimum, in previous years. The calculated
average ratio considers data from as many previous years as possible, with the average ratio
weighted by total activity per year. For emissions sources where previous year data is not available
at quarterly granularity, a Current Year Average
2
is applied.
Structural changes – such as mergers, acquisitions, and divestments – that occur during the
reporting year are reflected in UMG’s scope 3 emissions using actual data, where available. In select
instances where actual data is not available, UMG estimates emissions data. In 2024, UMG estimated
emissions data for [PIAS].
1
The Historical Average method is used in the emissions calculations for scope 3 categories 1 and 4.
2
The Current Year Average method is used in the emissions calculations for scope 1, scope 2 (location-based), scope 2 (market-based), and scope 3 categories 1, 3, 4, 5, 6, 9, 12, and 14.
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Gross scopes 1, 2, 3 and total GHG emissions (E1-6)
1
Retrospective Milestones and target years
2019 (Base Year) 2023 2024 % 2024 / 2023 2032 (Target Year) Annual % target / 2019
Scope 1 GHG emissions
Gross scope 1 GHG emissions (tCO
2
e) 4,441 1,945 1,797 -8 1,865 4.46
2
Percentage of scope 1 GHG emissions from regulated emission trading schemes (%) 0 0 0 - - -
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions (tCO
2
e)
3
8,342 8,272 8,816 7 - -
Gross market-based scope 2 GHG emissions (tCO
2
e) 7,013 5,627 6,467 15 2,945 4.46
2
Significant scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions (tCO
2
e)
4
530,824 469,588 619,156 32 - -
1 Purchased goods and services 330,041 287,537 327,454 14 - -
2 Capital goods 36,510 19,948 32,153 61 - -
3 Fuel and energy-related activities (not included in scope 1 or scope 2) 3,167 3,443 2,789 -19 - -
4 Upstream transportation and distribution
5
39,495 51,419 90,880 77 - -
5 Waste generated in operations 230 493 556 13 - -
6 Business travel 67,888 53,718 50,967 -5 - -
7 Employee commuting 9,651 6,036 5,823 -4 - -
9 Downstream transportation and distribution 1,346 1,910 3,616 89 - -
12 End-of-life treatment of sold products 2,698 4,454 5,608 26 - -
14 Franchises 22,639 8,218 6,052 -26 - -
15 Investments 17,159 32,412 93,257 188 - -
Total GHG emissions
6
Total GHG emissions (location-based) (tCO
2
e) 543,607 479,805 629,769 31 - -
Total GHG emissions (market-based) (tCO
2
e) 542,278 477,160 627,420 31 - -
1 Due to rounding, amounts may not add up precisely to the totals provided.
2 UMG's target is to reduce absolute scope 1 and 2 GHG emissions 58% by 2032 from a 2019 base year; the annual reduction rate required to achieve this target is 4.46%.
3 UMG does not have a target covering scope 2 location-based emissions; therefore, there is no data in the 'Milestones and target years' columns.
4 UMG does not have an absolute scope 3 target; therefore, there is no data in the 'Milestones and target years' columns. See “Science-based targets progress” for relevant data on UMG’s science-based scope 3 intensity target.
5 Category 4 reported emissions represent approximately 95% of global activity.
6 UMG does not have a target covering total GHG emissions; therefore, there is no data in the 'Milestones and target years' columns.
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GHG emissions per net revenue (E1-6)
1
Metric 2024
Total GHG emissions (location-based) per net revenue (tCO
2
e/million EUR) 53.2
Total GHG emissions (market-based) per net revenue (tCO
2
e/million EUR) 53.0
Scope 1 and 2 GHG emissions breakdown
2024
Scope 1 GHG emissions
1,797
Mobile sources (tCO
2
e) 1,058
Stationary sources (tCO
2
e) 739
Of which refrigerants
35
Of which domestic fuel oil
1
Of which natural gas
703
Scope 2 GHG emissions (location-based)
8,816
Electricity (tCO
2
e) 7,620
Steam/imported heat (tCO
2
e) 1,196
Scope 2 GHG emissions (market-based)
6,467
Electricity (tCO
2
e) 5,271
Steam/imported heat (tCO
2
e) 1,196
1
See "Consolidated Statement of Profit or Loss" in the Board report.
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SOCIAL INFORMATION
Own workforce (S1)
Policies related to our workforce (S1-1)
Code of Conduct and Whistleblowing Policy
UMG’s Code of Conduct, implemented by our Chief Compliance Officer, is applicable to every person
conducting business for UMG, including employees, interns, officers, members of the board of
directors, and third parties such as consultants, independent contractors, and company advisors
or representatives. Relevant aspects of our Code of Conduct are described further below.
To achieve the standards set out in our Code of Conduct, our Board adopted a standalone
Whistleblowing Policy, implemented by our Chief Compliance Officer. The purpose of our
Whistleblowing Policy, discussed further below, is to encourage all employees and other
stakeholders (e.g. shareholders, suppliers, and customers) to report genuine concerns or complaints
about unethical behavior, malpractices, illegal acts or failure to comply with regulatory requirements
without fear of reprisal should they act in good faith when reporting such concerns or complaints.
Human rights commitments
At UMG, we believe that respecting human rights is essential to fostering a workplace where
individuals can thrive creatively and professionally. UMG's Code of Conduct includes a zero-
tolerance policy towards harassment, discrimination, violence, child labor, slavery, human
trafficking, and unsafe working conditions. These values are reflected across our operations and
we only conduct business with partners, suppliers, and customers who share our commitment
to protecting human rights. We also empower employees to speak up if they witness or suspect
any human rights violations. Our Code of Conduct is consistent with the United Nations Guiding
Principles on Business and Human Rights.
Our Code of Conduct also covers our approach to workplace safety, security and the health of our
employees, as well as procedures to help us to create a safe work environment.
Anti-discrimination and inclusion
Our Code of Conduct encourages an inclusive environment that promotes individual expression,
creativity, innovation, and achievement and emphasizes that within UMG diverse backgrounds and
skills are valued as well as individual differences in race, ethnicity, gender or gender identity, sexual
orientation, disability, religious affiliation, age, experience, and thought.
Our Board also adopted a separate diversity and inclusion policy (the D&I Policy) as per articles
2:142b and 2:166 of the Dutch Civil Code and best practice provision 2.1.5 of the Code, laying down
the elements of a diverse and inclusive composition of the Board and senior management as well
as appropriate and ambitious aspirations in this respect. The D&I Policy is detailed in the Corporate
Governance section of the Board report.
Processes for engaging with own workforce and workers’ representatives about impacts (S1-2)
UMG maintains a dedicated Employee Listening program. Employee Listening is how we pass the
mic –to hear thoughts and opinions on the employee experience at UMG. Our strategy consists
of a series of surveys that follow the employee lifecycle to measure each employee’s individual
experience, and company-wide surveys to pulse where we are at in meeting our objectives. The
Strategy, Insights & Planning Team, within our People, Inclusion & Culture Department under the
oversight of our Executive Vice President, Chief People and Inclusion Officer, is responsible for
our workforce surveys. In the U.S., Korea, and Southeast Asia, with a planned global expansion in
coming years, we continuously run Lifecycle Surveys (first week new hire, 90-day new hire, and exit
surveys) to capture key information along the employee journey. Globally, we run engagement or
pulse surveys on an as-needed basis to measure progress on our objectives. Additionally, our labels
leverage our Strategy, Insights & Planning team to gather enterprise and label-specific insights.
As described in this Sustainability Statement, we also directly consult our employees as part of our
DMA process and ongoing employee engagement. See "Description of the process to identify and
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assess material impacts, risks, and opportunities (IRO-1)" and "Interests and views of stakeholders
(SBM-2)" in ESRS 2 General information for more information.
Processes to remediate negative impacts and channels for own workers to raise concerns (S1-3)
UMG addresses material negative impacts on our own workforce through a global framework
overseen by the Compliance and People, Inclusion and Culture Departments using a multi-pronged
approach and consistent with local laws: (1) training and guidance to our workforce as to their rights
and obligations while working at UMG; (2) multiple channels to raise questions, needs, concerns, or
allegations of impropriety; (3) a system to investigate any allegations requiring review; (4) prohibition
against retaliation for raising good faith concerns; and (5) periodic assessments to ensure the
processes are effective. Any material negative impacts to UMG's own workforce are also addressed
within the Company's internal Ethics and Compliance Committee and, where appropriate, raised to
UMG's Board.
As set forth in our Code of Conduct and Whistleblowing Policy, UMG provides multiple channels for
our workforce and anyone conducting business for UMG to raise questions or voice concerns. They
can also address their needs and concerns through direct communication with their supervisor or
department leadership or by contacting the People, Inclusion & Culture department, legal counsel,
General Counsel or Chief Compliance Officer and through our Global Compliance and Ethics hotline
(the “Hotline”). The Hotline, supported by a third-party provider, permits employees to raise concerns
24 hours a day, seven days a week via telephone or the internet. Additionally, such concerns may be
made anonymously where permitted by local law.
UMG's grievance and complaint mechanisms are described in our Code of Conduct, Whistleblowing
Policy, and territory-specific grievance procedures as may be required by local law. UMG takes
each report of suspected violations seriously, regardless of how the matter is disclosed to the
company. Pursuant to our Code of Conduct, all reports of misconduct must be investigated promptly,
thoroughly, and objectively. Depending on the nature of the complaint, UMG determines how the
complaint should be investigated, considering such factors as whether the investigation should
be conducted internally or using external resources, whether forensic expertise will be required,
language issues. Complaints are communicated to appropriate internal parties on a need-to-know
basis, whether to selected executive in the region where the report originated, the Ethics Committee
or the Board. Confidentiality is maintained to the fullest extent possible and as required by
applicable local laws. Upon conclusion of an investigation, if misconduct is found, UMG administers
appropriate discipline to those involved, consistent with local laws. Our Whistleblowing Policy
prohibits retaliation against anyone who reports a concern in good faith.
UMG seeks to ensure that our workforce is aware of the multiple channels to ask questions and
report concerns by: (1) issuing our Code of Conduct and Whistleblowing Policy to all employees
globally every year and ensuring acknowledgement and understanding of these policies by each
employee; (2) ensuring that all global training courses include the methods by which to ask
questions/report concerns; (3) emailing information regarding the Hotline to all employees; and (4)
conducting periodic workforce surveys, which include issues related to knowledge of the reporting
channels and likelihood of use of the channels.
Taking action on material impacts on own workforce, and approaches to mitigating material
risks and pursuing material opportunities related to own workforce, and effectiveness of those
actions (S1-4)
Diversity, inclusion, and belonging and gender equality
Cultivating work environments that are welcoming, inclusive, free of discrimination, and that
promote a diversity of perspectives and backgrounds can increase our resilience as a company as
well as the creativity behind our products and services.
In 2024, we continued to act on this belief through continued investment in our talent and by
working to cultivate a culture of belonging.
Internally, Employee Resource Groups (ERGs) provide a platform for employees to network, share
experiences, and influence employee programming. All employees are encouraged to become
members and participate. Our ERGs include:
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■
BLACK LABEL: Fosters community and cultivates leaders at UMG, while celebrating Black culture
across the music industry.
■
CULTURA: Celebrates the diversity and unity of Latinx and Hispanic people by promoting cultural
awareness, supporting Latinx communities, and empowering current and future Latinx and
Hispanic leaders at UMG.
■
PRISM: Cultivates a space to build community and celebrate LGBTQ+ identifying individuals and
allies within UMG and across the music industry.
■
UTOPIAA: Provides a community and platform for employees that identify as Asian American &
Pacific Islander (AAPI) and their allies.
■
WOMEN’S NETWORK: Serves to advance the position of women in the music industry by providing
a support system that allows members to express themselves and realize their goals – both
professional and personal.
Attraction and retention of employees
UMG is powered by the talents of our people. We recognize that our ability to attract and retain
talented employees is closely tied to our business model, particularly to the extent that a failure
to attract and retain employees could negatively impact our ability to attract and retain artists. The
management and advancement of employee wellbeing, development, compensation and benefits,
and engagement strengthen our workforce by attracting and retaining top talent at all levels.
To attract the next generation of talent, UMG hosts internship programs for students across a variety
of institutions. To continue to foster talent throughout all career levels, UMG maintains various
training programs. Our “The 6” series of development programs aims to equip employees with
essential skills for career growth and effective team management. In 2024, we conducted training
programs tailored to cohorts of people managers, director-level leaders, and senior-level leaders,
respectively. UMG also maintains a global job architecture project, launched in 2023, to standardize
career leveling and remuneration, addressing concerns related to compensation disparities and
supporting retention, particularly for early and mid-career employees who are most vulnerable
to turnover.
Globally, our employee benefits are suited for the diverse needs of our workforce and support
a company-wide culture of physical health, mental health awareness, and overall wellbeing. In
addition to competitive compensation structures, our total rewards program is central to our
strategy for enhancing our appeal as an employer and creating a positive, healthy workplace. While
specific benefits vary by region, in the United States, for instance, UMG’s medical plans provide
unlimited access to mental health services at no cost when using in-network providers; includes
comprehensive family support programs and prioritize women’s health through targeted benefits;
includes 12 weeks of paid family leave time to care for loved ones; and covers travel for employees
and eligible dependents for fertility-related medical care.
Targets related to managing material negative impacts, advancing positive impacts, and managing
material risks and opportunities (S1-5)
As enshrined in our D&I policy, we are committed to improving the gender diversity among our
senior managers and to promoting diversity and inclusion in the boardroom. Our specific aspirations
pertaining to these commitments, which were developed with input from our senior management
and unanimously approved by our Board, are discussed in further detail in the Corporate Governance
section of the Board report.
Methodology (S1-6, S1-9, S1-16)
The reporting scope covers all UMG employees and data is collected from our global human resource
platform. For the calculations of pay gap and annual total remuneration ratio, data is also collected
from our local payroll systems. UMG defines an "employee" as an individual who (i) works for UMG
and (ii) is in a contractual relationship with UMG.
Headcount-related indicators are expressed in number of employees as of December 31, 2024.
Headcount by gender is based on the gender indicated by employees in our global human resource
platform. Employees that selected they prefer not to disclose their gender are reported under ‘other’.
Employees that did not select a gender are reported under ‘not reported’.
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For the employee turnover calculation, the numerator of the rate is the aggregate of the number
of employees who leave voluntarily or due to dismissal, retirement, or death in service. The
denominator of the rate is the total number of employees during the reporting period.
Top management comprises: (i) the executive directors of the Board, including the Chairman and
CEO, (ii) the Chairman and CEO’s direct reports who lead a label or business or with a primary
function, (iii) for other key labels or businesses, their leaders and in some instances, certain of their
direct reports, and (iv) key large function leaders.
The pay gap is calculated using the following formula: (Average gross hourly pay level of male
employees – average gross hourly pay of female employees) / Average gross hourly pay level of male
employees) x 100.
The annual total remuneration ratio is calculated using the following formula: Annual total
remuneration of the highest paid individual / Median employee annual total remuneration
(excluding the highest paid individual).
The pay gap and annual total remuneration ratio calculations include the following:
1.
Base salary, which is the sum of guaranteed, short-term, and non-variable cash compensation;
2.
Benefits in cash, which is the sum of the base salary and cash allowances, bonuses,
commissions, cash profit-sharing, and other forms of variable cash payments; and
3.
Direct remuneration, which is the sum of benefits in cash, and total fair value of all annual
long-term incentives.
Because this is the first year in which UMG has calculated these metrics, UMG has not developed
targets relating to pay gap or the annual total remuneration ratio.
Employee headcount by gender (S1-6)
Gender Number of employees (headcount)
Male 4,955
Female 5,370
Other 6
Not reported 15
Total employees
10,346
Employee headcount by country (S1-6)
Country Number of employees (headcount)
United States 3,512
United Kingdom 1,562
Other countries 5,272
Total employees
10,346
Pursuant to ESRS S1-6 50(a), employee headcount breakdowns are reported by country for countries
in which UMG has 50 or more employees representing at least 10% of our total number of employees
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Employee headcount by geographical area (SBM-1)
Geographical area Number of employees (headcount)
APAC 1,504
EMEA 4,512
LATAM & Iberia 615
North America 3,715
Total employees
10,346
Pursuant to ESRS SBM-1 40(a) iii, employee headcount breakdowns are reported
by geographical area.
Employees by contract type, broken down by gender (S1-6)
Contract type Female Male Other
Not
reported Total
Permanent employees 4,918 4,703 6 9 9,636
Temporary employees 452 252 0 6 710
Total employees
5,370 4,955 6 15 10,346
Employee turnover (S1-6)
Turnover rate by type 2024
All employees 22%
Permanent employees 17%
Temporary employees 6%
Voluntary turnover
9%
In 2024, the total number of departures was 2,265. "Voluntary turnover" refers to employees
who initiated termination of employment with UMG. Of the above indicators, only turnover of all
employees is required by the ESRS.
Employee headcount by age group (S1-9)
Age group 2024
Under 30 years old 2,450
30-50 years old 5,553
Over 50 years old 2,313
Not reported 30
Total employees
10,346
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Remuneration metrics (S1-16)
In 2024, UMG’s pay gap was 44.68%. UMG acknowledges that there is room for improvement,
including with regards to gender diversity at the top management level. Although such improvement
cannot happen overnight, UMG has the aspiration that by December 31, 2026, at least 20% of the
senior managers is female. For more information, see “Diversity and inclusion” in the Corporate
Governance section of the Board report.
In 2024, UMG’s total remuneration ratio was a factor of 720.59. For additional information on
UMG’s remuneration, including remuneration policies, key remuneration elements and approach
to the remuneration for 2024, and remuneration and company performance development, see our
Remuneration Report.
UMG is actively preparing for the new EU Directive on Pay Transparency, which will take effect in
2026, and we see the directive as an aid for us to further evaluate this topic.
Attraction and retention of artists
Artists are at the core of our business. Our traditional full-service A&R approach, portfolio of
world-renowned labels, diversity of genres, and robust content and copyright protection measures
drive long-term value for our artists and increase their commercial success, consumer base, and
longevity potential. This topic impacts our direct operations as well as stakeholders across our value
chain, especially our artists, fans, and the creative community.
UMG’s competitive position is dependent on identifying, attracting, signing and retaining recording
artists and songwriters who are or will become commercially successful, who have long-term
potential, whose music is well received, whose subsequent music is demanded by consumers, and
whose music will continue to generate sales as part of its catalog for years to come. Our approach
to managing the risks associated with this topic are addressed in the Risk and Risk Management
section of the Board report.
We believe that by attracting, retaining, and supporting talented artists, we can drive socioeconomic
benefits throughout our own operations, value chain, and industry, and enhance the operational
stability, well-being, and creative output for artists.
Key actions
Several elements, discussed in further detail in the Strategy section of the Board report, form the core
of this effort and present positive actual or potential impacts and financial opportunities.
In addition, the following represent key actions we have taken, and continue to take, to drive our
positive impacts and realize our financial opportunities:
■
Streaming model and social media solutions
We continue to explore artist-centric principles and solutions with streaming and social platforms
including Deezer, Spotify, Tidal, TikTok, YouTube, Meta, SoundCloud, and Snap. Through the
collaborative efforts below, we seek to ensure fair compensation, among other benefits. Aspects
of these actions are further discussed in the Intellectual Property, Piracy, and Content Protection
section of this report.
– Reward Real Artists: Find ways to better reward artists whose content drives value to platforms.
– Clean Up Clutter: Take steps to limit non-artist noise content, including sounds, functional
music, and thirty-second AI tracks that are designed to profit inappropriately from the artist
royalty pool.
– Improving Correct Attribution: Aggressively seek correct attribution so that royalties are directed
toward the proper artists at a significant scale.
– Protect future artists and songwriters: Advocate and fight for AI guardrails that will protect
artists, songwriters and their works from future dilution caused by unlicensed generative AI.
■
Further advancing global diversification plans and partnerships
UMG continues to expand its repertoire, reach and capabilities globally, expanding our presence
and accelerating our growth in new regions. We partner strategically with leading local labels,
artist managers, and entrepreneurial companies to support and boost them with global
promotion, distribution, and a full suite of artist services. This allows us to discover new music
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and artists globally, expanding our catalog and repertoire, and creating opportunities to increase
market share.
■
Exploring new avenues for monetizing music
We are actively pursuing opportunities to bring our artists and music to the categories of health
and wellness and gaming, partnering with established and growing platforms, and embarking on
R&D to not only maximize existing commercial opportunities for our labels and artists, but to
identify future opportunities, fan behaviors, and consumption trends. Important to this activity is
our commitment to enhance the company’s D2C strategy and capabilities.
■
Defining and establishing responsible AI
We have been working across the services landscape, through collaboration and participation with
innovative companies like BeatDapp and BandLab Industries, while also driving broader industry
initiatives like the Human Artistry Campaign and the “Principles for Music Creation with AI”,
launched earlier this year in collaboration with Roland Corporation, which now has more than
70 industry companies and organizations signed up.
■
Facilitating the connection between artists and fans
UMG is committed to exploring ways to strengthen and better serve the artist-fan relationship
through superfan experiences and products. We have built a robust network of tools and services
for UMG artists to build comprehensive global campaigns that will help them reach fans around
the world. Superfans, a growing and influential category of music enthusiasts, spend 80% more
each month on music than the average listener, based on Luminate data. These fans drive
increased activity both on platforms, but also through UMG’s rapidly growing direct-to-consumer,
ecommerce and merchandising businesses, which represent a significant opportunity for UMG to
grow authentic engagement between fans and the artists they love.
Our multi-label structure, discussed in the Introduction section of the Board report, enables
entrepreneurs and encourages artistic diversity. Each of our labels maintains its own approach to,
and tracks the effectiveness of, developing, cultivating, and promoting artistic talent. For this reason,
UMG does not maintain global policies or targets pertaining to this topic.
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GOVERNANCE INFORMATION
Business conduct (G1)
Management of relationships with suppliers (G1-2)
UMG partners with suppliers who share our vision for a sustainable future. Suppliers are integral
to our business and we are dedicated to working alongside our partners to collectively advance
sustainability. UMG can make a positive impact by overseeing and actively managing our supply
chain to more effectively control our scope 3 emissions, promote product innovation, and promote
human rights and local economies.
Supplier relationships are managed by business units within UMG. UML manages suppliers for
physical audio products – which range from vinyl to CDs and DVDs – and Bravado manages suppliers
of merchandise. The UML and Bravado ESG working groups drive progress towards embedding
sustainability across UMG’s supply chain, as detailed below. For more information on our ESG
working groups, see "Sustainability management" in the Corporate Governance section of the
Board report.
Key policies
Supplier Social Responsibility Policy
The UMG Supplier Social Responsibility Policy is foundational to our approach. The policy, overseen
by our Chief Compliance Officer and SVP, Head of Sustainability, is incorporated into all global
manufacturing agreements and sets out specific principles that we expect every supplier to follow
across environmental, social, and ethical impact areas.
The policy is anchored by internationally recognized frameworks, including the UN Guiding
Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, the
UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions, the
Children’s Rights and Business Principles established by UNICEF, the UN Global Compact, and Save
the Children principles. The policy requires our suppliers to comply with relevant national legal
standards and industry benchmark standards relating to stated impact areas, while establishing a
pathway for suppliers to implement corrective action when performance falls below provided criteria.
To track the effectiveness of our suppliers’ alignment with the Supplier Social Responsibility Policy,
UMG embeds controls and measures across various stages of the procurement lifecycle. For
example, Bravado requires certain direct suppliers in the US and UK, based on spend and risk, to
undergo the Sedex SMETA 2 Pillar Audit (or equivalent), which covers labor standards and health and
safety – key risk areas for the apparel manufacturing sector.
Key actions
Environmental Exhibit and reporting
Bravado and UML are laying the groundwork for deeper supplier engagement through a standardized
set of environmental-related terms and conditions set forth in an Environmental Exhibit. We began
integrating the Environmental Exhibit into certain direct supplier manufacturing partner agreements
in the US and UK in 2024 and will continue its rollout in 2025 to additional partner agreements.
The Environmental Exhibit is designed to drive environmental performance across our value chain,
particularly in relation to scope 3 GHG emissions, and enables us to screen and evaluate the
environmental performance of new suppliers based on their ability to accept and comply with the
provided terms. It is imperative that we engage our supply chain in our decarbonization efforts, as
their support will be critical in helping us achieve our GHG reduction targets, which were validated by
the Science-Based Targets initiative (SBTi) in 2023.
To support our GHG reduction trajectory, the Environmental Exhibit requires our suppliers to set and
validate their own science-based targets through SBTi within a stated timeline. The Environmental
Exhibit also requires suppliers to submit two surveys to UMG on an annual basis. The first of these
surveys, the Supplier GHG Survey, collects GHG emissions data (including emissions attributable
to UMG). The second survey, the Supplier Sustainability Survey, collects information on current
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sustainability programs and future plans within key environmental, social, and ethical impact
areas. We intend to leverage survey results to help us continue to evaluate supplier sustainability
performance, more effectively track and manage our scope 3 GHG footprint, surface potential
sustainability risks and areas for improvement, and identify opportunities to scale innovative
technologies, partnerships, and processes.
In 2024, we took action to support supplier understanding of our expectations for social and
environmental responsibility, including the roll-out of a digital guide for our suppliers and one-on-
one supplier meetings to answer questions and inspire greater collaboration.
Additional supply chain measures
While the annual surveys tied to our Environmental Exhibit serve to assess supplier sustainability
performance, Bravado also evaluates Tier 1 suppliers on a quarterly basis according to product,
pricing, and delivery criteria. Bravado leverages results to inform procurement decisions –
prioritizing partners that demonstrate expanded product capabilities and innovation.
In 2024, we also developed targeted, ongoing sustainability strategies for Bravado and UML
product development teams – providing guidance around how UMG can prioritize vendors that
offer sustainable materials and that demonstrate strong environmental and social commitments.
Strategy development was informed by the 2023 UMG x Bravado Sustainability Summit Series, which
assembled UMG employees, artist managers, and suppliers to explore sustainability advancements
across the industry.
In 2024, our efforts centered on gathering information from and generating awareness among our
suppliers. With this as our focus, we have not yet set specific targets for this topic. We believe that
targets can serve as a useful tool to continue our efforts and may adopt them in future years to help
us continue to drive progress.
Intellectual property, piracy, and content protection
Security of content against piracy or theft is a key focus of our business. Technological advances
and the conversion of music into digital formats have made it easy to create, transmit and distribute
high-quality unauthorized copies of music. In addition, technology to create AI-generated music
and images has introduced new challenges for the protection of intellectual property and artist
rights. These include intellectual property infringement through the unauthorized reproduction of
copyrighted works to train AI technology, which in turn enables the creation of AI-generated works
that infringe intellectual property rights and embody unauthorized renditions of artist voices, images
and likenesses.
The nature of these risks and our response to them are further discussed in the Risk and Risk
Management section of the Board report.
Key policies
UMG’s content protection framework, established and implemented by our Content Protection
department and overseen by our EVP, Business and Legal Affairs and Head of Litigation, includes
five key principles:
■
Defend - Work with our internal security teams, our labels, and our artists to protect our content at
all stages in the release lifecycle to help prevent leaks by implementing best practices.
■
Detect - Use resources and technology to detect leaks and infringing content on web sites,
marketplaces and within social messaging communities.
■
Disrupt - Work with our trade organizations to cause piracy disruption through intermediary,
regulatory and enforcement actions.
■
Dismantle - Work with our trade organizations to pursue civil and / or law enforcement authorities
on the enforcement of pirate sites operators and networks.
■
Develop - Work with our internal teams, artists and labels to provide data and create a landscape
in which artists and talent can thrive.
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Key actions
At UMG, we are fully dedicated to protecting the creative works of our artists and songwriters.
Beginning in 2002, we were the first major music company to create a Content Protection
department, which serves to identify threats and create strategies and workflows to stop them.
Steered by our Content Protection team, we engage with internal and external stakeholders to help
identify and analyze risks to UMG content, brands, labels, and artists. In collaboration with global
trade organizations, our content protection initiatives span several areas:
■
Label support
The Content Protection department is the primary point of contact for labels who require
content to be removed from DSPs and aggregators, including copyright infringement, unauthorized
remixes, mis-labelled uploads, and non-UMG tracks that have been tagged with a UMG artist.
This work helps us to try to ensure that only authorized tracks exist on DSPs and are
correctly attributed.
■
Pre-release protection
Releases face the highest level of risk during the pre-release phase, when producers and sound
engineers collaborate ahead of production. We advise on security best practices and work with
stakeholders, external platforms, and websites to spot and remove leaked content to seek to
minimize risks of further unauthorized distribution.
■
Post-release protection
Once content has been released, infringing uploads and posts frequently occur on sites without
a license. By identifying and removing these sites, posts, and uploads, we increase each release's
value over time. Additionally, as part of this workstream, we identify unlicensed sites that present
a commercial opportunity for UMG.
■
Emerging markets
As markets grow in emerging territories, so does the risk of leaks in those regions. We work with
our international trade organizations to build content protection strategies and workstreams that
support the development of emerging music markets. By removing illegal websites, posts, and
uploads, we help direct users within emerging markets to legitimate content sources to enhance
their listening experience and protect UMG revenue streams.
■
Mobile applications
Apps are the new internet. Many markets went directly to mobile apps, and in those that didn't,
our target audience has moved to them. We have a dedicated team focused on mobile app piracy
that works alongside our trade organizations to detect and remove infringing applications and
content globally across all major application stores. We treat mobile application piracy as one of
our priority initiatives and have established working groups to coordinate resources and enforce
against infringers in this area.
■
Merchandising
Due to its popularity and affiliation with UMG artists, Bravado merchandise is often counterfeited
or impersonated. Our Content Protection team works closely with Bravado to remove infringing
products from major online marketplaces and retailers. In addition to our merchandise protection,
we also protect our brands and artist likenesses from being used without authorization within
digital environments.
■
UMPG
Content Protection supports UMPG by removing unauthorized covers, masters, and live recordings
- as well as infringing uses of our publishing rights. Supporting UMPG directly ensures that we can
remove unauthorized content quickly and avoid duplication.
We have developed specialized workflows to remove unauthorized posts and have built bespoke
software to collect release information and project rulesets globally, thereby maximizing our labels’
marketing and promotional efforts and preserving the integrity of our artists’ creations and their
ability to connect with fans authentically.
We work with law enforcement to stem the flow of criminal physical and digital piracy by assisting
with witness statements and providing training to help to ensure that they are fully aware of new
trends and investigative techniques in digital piracy.
We continue to work with our licensed service partners to share intelligence and introduce workflows
to counter the threat of streaming fraud. We work with vendors that use sophisticated systems to
identify falsely labelled tracks to ensure that our legitimate artist and label receive both credit and
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revenue for their works. We also have an internal cross-functional task force established to combat
this activity.
We use multiple datapoints to inform our content protection strategies. In partnership with the
Global Security Office, the Content Protection team maintains a database of all of UMG’s criminal
referrals. Our trade organizations also maintain investigative databases that allow us to track repeat
threats to UMGs artists and labels. We measure “takedown” requests—that is, the formal notice of
legal process to remove an unauthorized track—across various licensed platforms through internal
business intelligence systems that are automatically populated based on takedown requests,
regardless of whether we issue these requests directly to platforms or indirectly through our trade
organizations. To inform our content protection strategies with respect to physical piracy, we track
the number and estimated value of seizures of counterfeit and unauthorized physical products.
Content protection is part of our business-as-usual approach and ongoing daily operations. As such,
UMG does not have time-bound targets with respect to this topic.
Privacy and cybersecurity
UMG maintains the trust of our artists and partners through the ethical and compliant collection,
use, and sharing of data. Technology, security, and compliance teams work to continuously improve
processes and technologies to minimize risk and optimize UMG’s use of data and technology.
The nature of our risks relating to privacy and cybersecurity, and our response to them, are further
discussed in the Risk and Risk Management section of the Board report.
Key policies
Our publicly available Code of Conduct, implemented by our Chief Compliance Officer, applies to
every person conducting business for UMG, including employees, interns, officers, members of the
board of directors, and third parties such as consultants, independent contractors, and company
advisors or representatives. Our Code of Conduct outlines best practices and acceptable behavior
with respect to data privacy and cybersecurity matters, including the responsible protection of
confidential information and the responsible use of information and communication systems.
In addition, UMG employs a wide variety of tools and services to ensure the integrity and
security of our critical assets which are supported by a number of policies and procedures that
cover topics including cloud security, business continuity, vulnerability management, and security
incident response, among others. Our Chief Security Officer is responsible for the implementation of
these policies.
All policies and procedures are reviewed and updated as needed on a regular basis.
Key actions
To uphold stakeholder trust and comply with privacy and cybersecurity regulations, UMG maintains
a global data protection compliance program via its Privacy Office which includes governance
and data management processes, data subject rights processes, privacy disclosures, employee
training, cross-border transfer agreements, supplier contract terms, internal audit procedures and
incident response processes. UMG's Global Security Office (GSO) is responsible for company-wide
cybersecurity policies, described above, as well as standards development, cybersecurity education
(including regular phishing and other security training) and compliance monitoring. The GSO has
developed a mature cybersecurity program that encompasses aggressive vulnerability management,
centralized log collect, use of a 24x7 managed security service provider, a robust security incident
response process, regular penetration testing and extensive use of threat management and threat
hunting teams.
Cybersecurity is a part of our business-as-usual approach and ongoing daily operations. As such,
UMG does not have time-bound targets with respect to this topic. As of the date of this Annual Report,
we have not identified any breaches of cybersecurity or related risk threats that have a financially
material impact on our business.
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Non-Executive
Directors' Report
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NON-EXECUTIVE DIRECTORS' REPORT
As the Non-Executive Directors, we are responsible for supervising the Executive Directors’ policy
and performance of duties and the Company’s general course of affairs and business, and rendering
advice and direction to the Executive Directors. In performing our duties, we are guided by the
Company’s corporate interests, which extend to the interests of all of the Company’s stakeholders,
including the Shareholders and the Company’s creditors, customers and employees.
Composition
The Board has a one-tier board structure and currently comprises of two Executive Directors
and eleven Non-Executive Directors, two of whom, being Eric Sprunk and Mandy Ginsberg, were
appointed to the Board by the General Meeting on May 16, 2024:
Name Function
Sir Lucian Grainge Executive Director, Chairman and Chief Executive Officer
Vincent Vallejo Executive Director, Deputy Chief Executive Officer, Corporate
Sherry Lansing Non-Executive Director, Chairman of the Board
Margaret Frerejean-Taittinger Non-Executive Director, Vice-Chairman of the Board
Bill Ackman Non-Executive Director
Cathia Lawson-Hall Non-Executive Director
Cyrille Bolloré Non-Executive Director
Eric Sprunk Non-Executive Director
Haim Saban Non-Executive Director
James Mitchell Non-Executive Director
Luc van Os Non-Executive Director
Mandy Ginsberg Non-Executive Director
Nicole Avant Non-Executive Director
Antoine Fiévet acted as Non-Executive Director and chair of the Remuneration Committee until the
close of the annual General Meeting held on May 16, 2024, on which date his term ended. He decided
not to stand for reappointment.
Manning Doherty acted as Non-Executive Director but recently resigned from the Board, effective
March 21, 2025.
None of the Non-Executive Directors represents the Company’s employees and other workers.
Diversity and inclusion
The elements of a diverse and inclusive composition of the Board as well as appropriate and
ambitious aspirations in this respect are laid down in the D&I Policy as per articles 2:142b and
2:166 of the Dutch Civil Code and best practice provision 2.1.5 of the Code. In accordance with
the D&I Policy, the Non-Executive Directors are committed to promoting diversity and inclusion
in the boardroom and to ensuring that all Non-Executive Directors are able to contribute to
Board discussions.
They furthermore have the aspiration:
■
to improve or safeguard gender diversity among the Non-Executive Directors, such that at least
one third of the Non-Executive Directors is female and at least one third of the Non-Executive
Directors is male, thereby at all times taking into account the Dutch statutory gender diversity
requirement with regards to the Non-Executive Directors.
■
to improve or safeguard diversity with regards to age, nationality, ethnicity and cultural or other
background, as well as to create and maintain a variation in expertise, experience, competencies,
other personal qualities and perspectives among the Non-Executive Directors.
The Non-Executive Directors are further committed to considering candidates for Non-Executive
Director positions from a wide pool, including candidates with no prior publicly listed company board
level experience.
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The elements as laid down in the D&I Policy with respect to the composition of the Board are all
important drivers in the selection procedure and will all be considered when identifying a candidate
for a Non-Executive Director position. However, when identifying a candidate, the qualifications of
such candidate and the requirements for the Non-Executive Director position shall in principle
always prevail.
The Non-Executive Directors considered that their composition as at December 31, 2024 was diverse
and with women representing 42% of the Non-Executive Directors, also in line with the gender
diversity aspiration included in the D&I Policy as well as with the gender diversity requirement
included in Dutch law. Among the Non-Executive Directors, there were seven nationalities (American,
British, Canadian, Dutch, French, Israeli and Togolese) and age ranged between 39 and 80.
Independence
The Non-Executive Directors endorse the principle that their composition shall be such that they are
able to operate independently and critically vis-à-vis one another, the Executive Directors and any
particular interests involved.
Given the shareholder base of the Company, the Non-Executive Directors are of the opinion that,
in the context of preserving the continuity of UMG and ensuring a focus on sustainable long-term
value creation, it is in the Company’s corporate interests and in the interests of the Company’s
stakeholders that among the Non-Executive Directors, there is a fair and adequate representation
of persons who hold a substantial shareholding or represent a (group of affiliated) substantial
shareholder(s), even if those persons are considered non-independent within the meaning of best
practice provision 2.1.8 of the Code.
As set out in the Corporate Governance section under "The Board--Independence", best practice
provision 2.1.8 of the Code states that a Non-Executive Director shall not be considered independent
if such Non-Executive Director, among others, (i) has a shareholding of at least 10% of the
issued share capital of the Company, (ii) is a member of the management (or executive) board or
supervisory (or non-executive) board – or is a representative in some other way – of a legal entity
which holds at least 10% of the issued share capital of the Company, or (iii) has been an Executive
Director in the five years prior to his or her appointment.
In the financial year 2024, five out of twelve Non-Executive Directors were considered non-
independent on the basis of being persons who hold a substantial shareholding or represent a
(group of affiliated) substantial shareholder(s), being:
■
Bill Ackman, to whom more than 10% of the issued share capital of the Company could
be attributed by virtue of his control over Pershing Square Capital Management L.P., i.e., the
investment adviser to the various Pershing Square funds through which that shareholding was
held. However, effective December 31, 2024, the more than 10% shareholding that could be
attributed to Bill Ackman decreased to 7.48% of the issued share capital of the Company after
various of the finite-life Pershing Square funds (with an end date of January 31, 2025) elected
to distribute their UMG shareholdings to their limited partners, which included multiple non-
Pershing Square affiliated investors. In addition, on March 13, 2025, the 7.48% shareholding that
could be attributed to Bill Ackman further decreased to 4.74% of the issued share capital of
the Company after Pershing Square funds offered and sold part of their UMG shareholdings in
an accelerated bookbuild. This means that Bill Ackman is currently no longer considered non-
independent.
■
Cathia Lawson-Hall, who is a member of the supervisory board of Vivendi SE which holds
approximately 10% of the issued share capital of the Company.
■
Cyrille Bolloré, who is the Chairman and Chief Executive Officer of the Bolloré Group, one of the
Company’s largest shareholders, as well as a member of the supervisory board of Vivendi SE
which holds approximately 10% of the issued share capital of the Company.
■
James Mitchell, who is a representative of the Tencent-led consortium which holds approximately
20% of the issued share capital of the Company.
■
Manning Doherty, who was a representative of the Tencent-led consortium which holds
approximately 20% of the issued share capital of the Company. However, Manning Doherty
recently resigned from the Board, effective March 21, 2025.
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Although in the financial year 2024 three out of twelve Non-Executive Directors (two of whom are the
same as above) were former statutory managing directors of (a predecessor of) the Company, being:
■
James Mitchell, in the period from February 26, 2021 until September 20, 2021;
■
Luc van Os, in the period from December 4, 2020 until September 20, 2021; and
■
Manning Doherty, in the period from February 26, 2021 until September 20, 2021,
the Company did not consider them non-independent on the basis of being former Executive
Directors given the short period during which they were appointed as statutory managing
directors of (a predecessor of) the Company prior to, and primarily in preparation for, the Listing,
while the Company performed no operational activities. For the avoidance of doubt, and as
set out in the preceding paragraph, James Mitchell and Manning Doherty were nonetheless
considered non-independent on the basis of being persons who represent a (group of affiliated)
substantial shareholder(s).
Financial year 2024
Non-Executive Directors
Independent 7
Non-Independent 5
Total 12
% Independent 58
% Non-Independent 42
Accordingly, in the financial year 2024, five out of twelve Non-Executive Directors were considered
non-independent. However, the other seven Non-Executive Directors, who were (and continue
to be) independent, including the Chairman of the Board, were comfortable that those five non-
independent Non-Executive Directors were nonetheless able to act independently and critically.
Moreover, as of January 1, 2025, only four out of twelve, and as of March 21, 2025, only three out
of eleven, Non-Executive Directors are considered non-independent now that: (i) effective December
31, 2024, the more than 10% shareholding that could be attributed to Bill Ackman decreased to
7.48% of the issued share capital of the Company after various of the finite-life Pershing Square
funds (with an end date of January 31, 2025) elected to distribute their UMG shareholdings to their
limited partners, which included multiple non-Pershing Square affiliated investors. In addition, on
March 13, 2025, the 7.48% shareholding that could be attributed to Bill Ackman further decreased to
4.74% of the issued share capital of the Company after Pershing Square funds offered and sold part
of their UMG shareholdings in an accelerated bookbuild. This means that Bill Ackman is currently
no longer considered non-independent, and (ii) effective March 21, 2025, Manning Doherty resigned
from the Board.
Remuneration
On May 16, 2024, the General Meeting adopted the revised remuneration policy for the Non-Executive
Directors, pursuant to which the Non-Executive Directors are entitled to receive part of their
remuneration in the form of restricted share units (RSUs). A revision of the remuneration policy
for the Non-Executive Directors was considered necessary to align the remuneration of the Non-
Executive Directors more closely with the Company's (sector) peers and to enhance the Company's
ability to attract, motivate and retain highly qualified individuals. The remuneration of the Non-
Executive Directors shall be determined by the Board with due observance of the remuneration
policy for the Non-Executive Directors. The remuneration policy for the Non-Executive Directors is
available on the investor relations part of the UMG website. In the Remuneration Report, details of the
individual remuneration of the Non-Executive Directors are set out.
Board meetings and activities
Meetings
During 2024, the Board held eight meetings, three of which were in-person meetings and five of
which took place via video calls. The meetings were attended by both the Executive Directors and the
Non-Executive Directors as well as by several corporate and other senior executives, as appropriate.
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Among the items discussed were (i) the Annual Report, the semi-annual financial report, the
quarterly results and the accompanying press releases, (ii) the external auditor’s findings and
audit report, (iii) the external auditor’s engagement to audit the financial statements and audit
plan, (iv) the external auditor's engagement to provide (limited) assurance on the sustainability
reporting, (v) the internal audit plan, (vi) the (final and interim) dividend proposals, (vii) the annual
budget and business plan, (viii) the implementation of the 2022 UMG Global Equity Plan, (ix) the
remuneration of the Executive Directors, including the selection of appropriate performance metrics
and targets, (x) the remuneration of the Non-Executive Directors, including the revision of the
remuneration policy for the Non-Executive Directors, which was adopted by the General Meeting on
May 16, 2024 and pursuant to which the Non-Executive Directors are entitled to receive part of their
remuneration in the form of RSUs, and the introduction of Non-Executive Director share ownership
guidelines, (xi) the nomination for reappointment of Vincent Vallejo as Executive Director, (xii) the
nomination for appointment of Eric Sprunk and Mandy Ginsberg as (new) Non-Executive Directors
and the nomination for reappointment of Bill Ackman, Cathia Lawson-Hall, Cyrille Bolloré, James
Mitchell, Margaret Frerejean-Taittinger and Nicole Avant as Non-Executive Directors, (xiii) strategy
updates, (xiv) business updates, including on milestone accomplishments of UMG artists and their
relationships with the Company, (xv) investor relations updates, (xvi) sustainability updates, (xvii)
Board committee composition and updates, (xviii) the financing of the Company and (xix) any
significant or related party transactions.
Sustainable long-term value creation
The Board, who is responsible for developing a view on sustainable long-term value creation by the
Company and for formulating a strategy as well as specific objectives in line with this view, has
on numerous occasions discussed the Company’s strategy. In particular, the Board discussed, at
several of its meetings, the Company’s views for the next era in streaming, the further roll-out of
its artist-centric model with partner platforms adopting principles that are expected to transform
the way in which artists are compensated for their content, its superfan initiatives, its response to
the opportunities and risks of (generative) artificial intelligence, including with respect to content
protection, and its high-potential markets strategy. The Board also spent two full days at the
Company's operational headquarters in Santa Monica, United States of America, including to spend
time with some of UMG's senior executives to hear more about their vision for the music business. In
addition, the Board is responsible for approving the annual budget as well as any transaction with a
value in excess of €300,000,000.
Education
Each time a new Non-Executive Director is appointed to the Board by the General Meeting, such Non-
Executive Director is required to follow an induction program geared to his or her role and aimed at
addressing any gaps in his or her knowledge. Such program typically covers general financial, social
and legal affairs, financial and sustainability reporting, aspects that are unique to the Company,
and the responsibilities of a non-executive director of a Dutch publicly listed company. Further
Non-Executive Director educational needs are normally identified as part of the Board evaluation.
Shortly following their appointment to the Board by the General Meeting on May 16, 2024, Eric Sprunk
and Mandy Ginsberg attended an educational session on their responsibilities as a non-executive
director of a Dutch publicly listed company. They also spent a full day at the Company’s operational
headquarters in Santa Monica, United States of America, to spend time with some of UMG’s senior
executives to learn more about the Company and the music business.
Board evaluation
In the fourth quarter of 2024 and the first quarter of 2025, at the initiative of the Nomination
Committee, the Board undertook a comprehensive Board evaluation, under the supervision of an
external expert, assessing the effectiveness of the Board, the Board committees and the individual
Directors. As part of the process, each Director completed an anonymous structured questionnaire,
covering critical areas such as composition, governance, culture, leadership and strategy. The
external expert then conducted one-on-one interviews with each Director to discuss the initial
findings of the questionnaire and to provide individual feedback. Key insights from the Board
evaluation were first discussed with the Chairman of the Board, the chair of the Nomination
Committee and the external expert. These insights were then presented and discussed during an
executive session of the full Board in the first quarter of 2025, with the external expert in attendance.
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Where relevant, the external expert had additional one-on-one sessions with individual Directors to
discuss their functioning and contributions.
The Board evaluation concluded that since its installation at the time of the Listing, the Board
has significantly matured. The external expert highlighted positive trends in Board effectiveness
and improved functioning of the Board committees and the individual Directors, leading to more
productive meetings, improved communication and stronger collaboration, both within the Board
and with the Company. Based on the results and feedback, the Board committed to continuous
growth, identifying opportunities for improvement while cultivating a culture of ongoing learning to
further enhance governance, culture and engagement.
Share positions
According to the AFM register, the following Executive Directors and Non-Executive Directors held a
capital interest and/or voting rights in the Company as at December 31, 2024:
Shareholder Notification date Shares RSUs
1
PSUs
2
PSOs
3
Voting rights
Sir Lucian Grainge October 25, 2024 371,772.00 2,580,020.25 818,712.72 8,624,917.00 371,772.00
Vincent Vallejo April 30, 2024 102,172.00 - - - 102,172.00
Sherry Lansing May 30, 2024 - 7,457.00 - - -
Margaret Frerejean-Taittinger May 28, 2024 - 5,681.00 - - -
Bill Ackman
4
December 31, 2024 136,797,950.00 - - - 136,797,950.00
Cathia Lawson-Hall May 31, 2024 2,356.00 5,681.00 - - 2,356.00
Cyrille Bolloré May 24, 2024 24,000.00 5,681.00 - - 24,000.00
Eric Sprunk May 24, 2024 - 5,681.00 - - -
Haim Saban May 24, 2024 - 5,681.00 - - -
Luc van Os May 30, 2024 105.00 5,681.00 - - 105.00
Mandy Ginsberg May 23, 2024 - 5,681.00 - - -
Nicole Avant June 7, 2024 - 5,681.00 - - -
1 (Unvested) restricted share units
2 (Unvested) performance share units
3 (Unexercised) performance stock options
4 Held in large part via various Pershing Square funds
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Board committees
The Board has appointed from among its Non-Executive Directors three Board committees to assist
it in discharging its responsibilities: the Audit Committee, the Remuneration Committee and the
Nomination Committee. Without prejudice to the collegiate responsibility of the Board, the duty of
these Board committees is to prepare the decision-making of the Board.
The Board has drawn up regulations for each Board committee, setting out the role and
responsibilities of the Board committee concerned, its composition and size and the manner in
which its meetings should be held. These regulations are available on the investor relations part of
the UMG website.
The current composition of the Board committees is detailed in the following table:
Audit
Committee
Remuneration
Committee
Nomination
Committee
Sherry Lansing Member Member
Margaret Frerejean-Taittinger Member Chair
Bill Ackman Member
Cathia Lawson-Hall Member
Cyrille Bolloré Member
Eric Sprunk Member Member
James Mitchell Member
Luc van Os Chair
Mandy Ginsberg Member Chair
Nicole Avant Member
The Audit Committee
The Audit Committee shall advise the Board in relation to its responsibilities, shall undertake
preparatory work for the Board’s decision-making regarding the supervision of the integrity and
quality of the Company’s financial and sustainability reporting and the effectiveness of the
Company’s internal risk management and control systems and shall prepare resolutions of the
Board in relation thereto.
In addition to the foregoing, the Audit Committee’s main responsibilities include: (i) supervising
and monitoring, and discussing with and advising the Board on, the effectiveness of the design
and operation of the internal risk management and control systems, including supervising the
enforcement of all applicable laws and regulations and supervising the effect of the Code of Conduct,
(ii) supervising the preparation and submission of financial and sustainability information by the
Company, (iii) supervising the compliance with recommendations, comments and observations of
the internal auditor, the external auditor(s) and any other external party involved in the auditing of
the sustainability reporting, (iv) instructing the external auditor(s) and the internal audit function
to inform the Executive Directors and the chair of the Audit Committee without delay if it or they
discover(s) or suspect(s) an instance of misconduct or irregularity, (v) supervising the functioning of
the internal audit function, (vi) ensuring that the way in which the internal audit function fulfills its
responsibility is assessed by an independent third party at least every five years, (vii) supervising
the policy of the Company on tax planning, (viii) supervising the financing of the Company, (ix)
supervising the applications of information and communication technology, including risks relating
to cybersecurity and data protection and risks relating to new technologies, (x) maintaining frequent
contact and supervising the relationship with the internal auditor, the external auditor(s) and any
other external party involved in the auditing of the sustainability reporting, (xi) implementing
the procedure for the selection of the external auditor(s) and submitting a recommendation to
the Non-Executive Directors for the (re)appointment or dismissal of the external auditor(s) by the
General Meeting, (xii) informing the Board of the outcome of the statutory audit and explaining
how the statutory audit contributed to the integrity of the financial reporting and what the role of
the Audit Committee was in that process, (xiii) monitoring the financial reporting and submitting
recommendations or proposals to ensure its integrity, (xiv) determining whether, and if so, how the
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external auditor(s) shall be involved in the content and publication of financial reports other than
the financial statements, (xv) issuing a recommendation on the appointment and dismissal of the
senior internal auditor, (xvi) submitting a proposal to the Board for the engagement of the external
auditor(s) to audit the financial statements and (xvii) considering and, where appropriate, approving
for recommendation to the Board the (semi-annual) financial statements, the annual budget and
major capital expenditures of the Company.
In 2024, the Audit Committee held five meetings, two of which were in-person meetings and three
of which took place via video calls. The meetings were attended by the Audit Committee members
as well as by the Chief Operating Officer and Chief Financial Officer, the Controller, the Chief Audit
Executive, the external auditor(s) and other corporate and senior executives, as appropriate.
Among the items discussed were (i) the Annual Report, the semi-annual financial report, the
quarterly results and the accompanying press releases, (ii) the external auditor’s findings and
audit report, (iii) the external auditor’s engagement to audit the financial statements and audit
plan, (iv) the external auditor’s engagement to provide (limited) assurance on the sustainability
reporting, (v) the (final and interim) dividend proposals, (vi) the annual budget and business plan, (vii)
the financing of the Company, (viii) compliance, including the application of the Code of Conduct
and appliacable laws and regulations, and any reported alleged misconducts or irregularities,
(ix) sustainability updates, including on the implications of the Corporate Sustainability Reporting
Directive (the CSRD) and the Company's work on, and the material impacts, risks and opportunities
identified as part of the double materiality assessment process undertaken in accordance with,
the CSRD, (x) the functioning of and updates from the Internal Audit and Controls Assurance
departments, (xi) the internal audit plan and (xii) the annual risk and fraud risk assessments.
In 2024, through written updates as well as at an Audit Committee meeting, the Head of Sustainability
informed the Audit Committee of the Company's work on, and the final list of material impacts,
risks and opportunities, which were identified as part of the double materiality assessment process
undertaken in accordance with, the CSRD, as set out in more detail in ‘Sustainability Statement’
under ‘Our Double Materiality Assessment Process’.
Within the Audit Committee, Cathia Lawson-Hall and Eric Sprunk are considered to have competence
in accounting and/or auditing and the Audit Committee members as a whole are considered to have
competence relevant to the sector in which the Company operates.
The Remuneration Committee
The Remuneration Committee shall advise the Board in relation to its responsibilities, shall
undertake preparatory work for the Board’s decision-making regarding the determination of the
remuneration of the individual Executive Directors and Non-Executive Directors, with observance of
the remuneration policies for the Executive Directors and Non-Executive Directors, respectively, and
shall prepare resolutions of the Board in relation thereto.
In addition to the foregoing, the Remuneration Committee’s main responsibilities include: (i) at least
every four years, submitting a proposal to the Board for the remuneration policies for the Executive
Directors and Non-Executive Directors, to be submitted to the annual General Meeting for adoption
and (ii) annually preparing the remuneration report, to be submitted to the annual General Meeting
for a non-binding advisory vote.
In 2024, the Remuneration Committee held five meetings, all of which took place via video call. The
meetings were attended by the Remuneration Committee members as well as by the Chief People
and Inclusion Officer and other corporate and senior executives, as appropriate.
Among the items discussed were (i) the remuneration report, (ii) the remuneration of the Executive
Directors, including the selection of appropriate performance metrics and targets, and the revision
of the remuneration policy for the Executive Directors, which must be submitted to the General
Meeting for adoption at the annual General Meeting to be held in 2025, (iii) the remuneration of the
Non-Executive Directors, including the revision of the remuneration policy for the Non-Executive
Directors, which was adopted by the General Meeting on May 16, 2024 and pursuant to which the
Non-Executive Directors are entitled to receive part of their remuneration in the form of RSUs, and
the introduction of Non-Executive Director share ownership guidelines, (iv) the implementation of
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the 2022 UMG Global Equity Plan, including its role in the attraction, retention and motivation of
skilled employees and (v) the Company’s compensation (sector) peer group.
In addition, the chair(s) of the Remuneration Committee had regular update meetings with the Chief
People and Inclusion Officer and other corporate and senior executives, as appropriate.
The Nomination Committee
The Nomination Committee shall advise the Board in relation to its responsibilities, shall undertake
preparatory work for the Board’s decision-making and shall prepare resolutions of the Board in
relation thereto.
In addition to the foregoing, the Nomination Committee’s main responsibilities include: (i) drawing
up selection criteria and appointment procedures for Directors, (ii) annually assessing the size and
composition of the Board, and making a proposal for the profile for Non-Executive Directors, (iii)
annually evaluating the functioning of the Board as a whole, the individual Directors and the various
Board committees, ensuring that such evaluation periodically takes place under the supervision of
an external expert and reporting on this to the Board, (iv) formulating succession plans for Directors
and drawing up a retirement schedule, (v) making recommendations for the (re)appointment of
Directors and (vi) supervising the policy of the Board on the selection criteria and appointment
procedures for senior management.
In 2024, the Nomination Committee held two meetings, both of which took place via video call. The
meetings were attended by the Nomination Committee members as well as by the General Counsel
and other corporate and senior executives, as appropriate.
Among the items discussed were (i) the nomination for reappointment of Vincent Vallejo as
Executive Director, (ii) the nomination for appointment of Eric Sprunk and Mandy Ginsberg as
(new) Non-Executive Directors and the nomination for reappointment of Bill Ackman, Cathia Lawson-
Hall, Cyrille Bolloré, James Mitchell, Manning Doherty, Margaret Frerejean-Taittinger and Nicole
Avant as Non-Executive Directors, (ii) the composition of the Board committees, (iv) (the results
and feedback of the Board evaluation assessing) the functioning of the Board, the various Board
committees and the individual Directors and (v) the (Non-Executive) Director succession planning
and retirement schedule.
Attendance and availability
The following table provides an overview of the attendance rate of the individual Non-Executive
Directors at the Board and Board committee meetings. Attendance is expressed as a number
of meetings attended out of the number of meetings held during 2024 while the individual Non-
Executive Director was a member of the Board or the Board committee in question.
Board Audit
Committee
Remuneration
Committee
Nomination
Committee
Sherry Lansing 8 – 8 5 – 5 2 – 2
Margaret Frerejean-Taittinger 7 – 8 4 – 5 2 – 2
Bill Ackman 8 – 8 2 – 2
Cathia Lawson-Hall 8 – 8 5 – 5
Cyrille Bolloré 8 – 8 5 – 5
Eric Sprunk 3 – 4 2 – 2 2 – 2
Haim Saban 8 – 8
James Mitchell 8 – 8 4 - 5
Luc van Os 8 – 8 5 – 5
Mandy Ginsberg 4 – 4 1 – 2 2 – 2
Manning Doherty 6 – 8 2 – 2
Nicole Avant 7 – 8 2 – 2
All Non-Executive Directors have had sufficient time available for their responsibilities as evidenced
by their prompt responses to e-mails, their availability for meetings, educational sessions and calls
and their well-preparedness for and active participation in such meetings, sessions and calls. Where
a Non-Executive Director was not available for a particular meeting, he or she was given
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the opportunity to provide input beforehand and was updated afterwards. At all Board and Board
committee meetings, there was a quorum present, such in accordance with the Board Regulations or
the regulations of the Board committees.
Appreciation
As the Non-Executive Directors, we wish to express our gratitude to the Executive Directors and all
UMG employees for their hard work and dedication in 2024.
The Non-Executive Directors:
Sherry Lansing
Margaret Frerejean-Taittinger
Bill Ackman
Cathia Lawson-Hall
Cyrille Bolloré
Eric Sprunk
Haim Saban
James Mitchell
Luc van Os
Mandy Ginsberg
Nicole Avant
Hilversum, March 27, 2025
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REMUNERATION REPORT
Dear Fellow Shareholder
I am pleased to present the 2024 Remuneration Report, which provides insights into the
remuneration of both Executive and Non-Executive Directors.
Remuneration Policies and approvals
On September 20, 2021, the General Meeting adopted the Executive Directors’ Remuneration
Policy
, establishing the framework for determining their compensation. Later, on May 11, 2023, the
General Meeting approved a supplement to this policy, specifically addressing Sir Lucian Grainge’s
remuneration package.
This report references the Executive Directors’ Remuneration Policy as of May 11, 2023. Before
Vincent Vallejo joined the board, he had an existing agreement, which the policy accommodates
as part of its provisions for historical arrangements. The Remuneration Committee and the Board
had no role in shaping his legacy arrangements, as it was established before UMG’s IPO.
We will be proposing a new Executive Directors’ Remuneration Policy at the upcoming AGM, set to
take effect as of the date of the AGM in 2025 until the next policy review. In shaping this revised
policy, the Remuneration Committee considered the impact of share price fluctuations on executive
pay, and internal pay differentials. Additionally, it considered compensation levels to comparable
peer companies and broader societal perspectives on Board remuneration. Lastly, the committee
took into account the Executive Directors' views on the structure and amount of their compensation
as an input into the final recommendations.
The proposed Policy includes no increases to incentive compensation levels. The most important
proposed amendments relate to the following:
■
The Company's policy on severance payments, to better align this policy with the market practices
for the industry the Company operates in;
■
The share ownership guidelines for Executive Directors;
■
Various textual and technical changes to further improve the clarity of the Remuneration Policy.
Universal Music Group's financial and strategic performance resulted in short-term incentive
performance above target.
In its decision-making, the Committee adhered strictly to both the Executive and Non-Executive
Directors’ Remuneration Policies.
Stakeholder engagement
At our last Annual General Meeting, 70.95% of shareholders supported the 2023 Remuneration Report
—compared to 58.96% the previous year. Following the AGM, we gathered feedback and used it to
refine the 2024 incentive metrics.
This Remuneration Report has been prepared in accordance with Article 2:135b of the Dutch Civil
Code and the Dutch Corporate Governance Code. It will be presented for an advisory vote at the
Annual General Meeting on May 14, 2025.
I sincerely thank our shareholders for their continued support and look forward to presenting this
report at the AGM.
Mandy Ginsberg
Chairman of the Remuneration Committee
This Remuneration Report has been prepared in accordance with article 2:135b of the Dutch Civil
Code and the Dutch Corporate Governance Code. It will be presented for an advisory vote to
Shareholders at the annual General Meeting to be held on May 14, 2025.
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Executive Directors’ Remuneration Policy
The objective of the Executive Directors’ Remuneration Policy is to provide a compensation
framework that allows UMG to attract, motivate and retain highly qualified Executive Directors and to
incentivize and reward long-term, sustainable growth of UMG. In order to ensure that the Executive
Directors' Remuneration Policy is aligned with UMG’s identity, mission and core values, it is built on
the following principles:
■
Focus on Company performance by including at-risk pay for the Executive Directors;
■
Linkage of performance objectives with UMG’s strategy;
■
Alignment of Shareholders’ interests with Executive Directors’ compensation design;
■
Ensure competitiveness with relevant markets to support UMG’s ability to attract, retain, and
motivate high caliber talent;
■
Support a simple and transparent framework.
Overview of the Key Remuneration Elements and Approach to the
Remuneration for 2024
In 2024, the Executive Directors were as follows:
Executive Director Position
Sir Lucian Grainge Chairman and Chief Executive Officer (Chairman and CEO)
Vincent Vallejo Deputy Chief Executive Officer, Corporate (Deputy CEO)
The following table sets out the key elements of the remuneration provided in the Executive
Directors’ Remuneration Policy versus the remuneration approach in 2024 for Sir Lucian Grainge
under the Current Agreement (as defined under 'Chairman and CEO Employment Agreement') and
for Vincent Vallejo under his management services agreement. Sir Lucian Grainge’s compensation is
denominated in US dollars but is reflected throughout this remuneration report in euros based on
the average monthly US dollar to euro exchange rate in 2024 of 0.9204.
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Element Key remuneration elements per Executive Directors’ Remuneration Policy Remuneration approach for 2024
Base salary Fixed cash compensation, aligned with the Executive Directors’ experience and scope of responsibilities and
intended to attract and retain Executive Directors necessary to execute the Company's strategy (as set out above
under ‘Strategy’).
Pursuant to each Executive Director's agreement, base salaries are as follows:
■
Chairman and CEO: €4,602,000
■
Deputy CEO: €960,000
Short-term incentive (STI)
1
Variable compensation payable annually in cash, or share awards, or a combination thereof, subject to the
achievement of annually pre-established objectives to ensure Executive Director alignment with, and motivate
the achievement of, the annual business priorities for the relevant year.
Target STI payout of up to 300% of base salary; maximum payout of no more than 200% of target bonus amount
for overachievement of targets.
Chairman and CEO:
Annual cash bonus with a target payout of €9,204,000 (200% of base salary), a minimum payout of €0 and a maximum
payout of €13,806,000 (150% of target bonus), subject to the achievement of specific financial and non-financial goals
detailed below.
Deputy CEO:
Annual cash bonus with a target payout of €480,000 (50% of base salary), a minimum payout of €0 and a maximum
payout of €960,000 (200% of target bonus), subject to the achievement of specific financial and non-financial goals
detailed below.
Long-term incentive (LTI)
1
Variable compensation payable in cash, or share awards, or a combination thereof, subject to the achievement
of annually pre-established objectives and/or continued services to retain Executive Directors necessary to
execute the Company’s strategy, to align the interests of Executive Directors with those of Shareholders and other
stakeholders, and to reward delivery of sustainable long-term value creation linked to the Company’s strategy and
strengthen alignment with the interests of Shareholders. Grant value is capped at 500% of base salary.
Chairman and CEO: Annual award of €18,408,000 in a combination of restricted stock units (RSUs) and performance
stock units (PSUs), subject to the achievement of specific financial goals detailed below.
Deputy CEO: No annual award
Retirement and other post-
employment benefits
Customary retirement income and severance benefits to provide future income security, aligned with relevant
market levels.
Chairman and CEO
2
: Pension allowance equals 20% of annual base salary, capped at €1,472,640 base salary per year,
for a total potential maximum pension allowance of €294,528 per year.
Deputy CEO: Participates in the local UMG pension plan.
Other benefits Customary and market competitive arrangements to compensate for any reasonable costs incurred or perks
required for the performance of Executive Directors' duties.
Chairman and CEO: Covers, among other things, health and welfare, housing allowance, automobile, tax equalization,
security, and home leave.
Deputy CEO: Covers health and welfare, housing allowance, automobile, tax consultation and life insurance.
1 When establishing the Threshold, Target and Maximum goals for the Short-Term and Long-Term Incentive awards, scenario analysis was conducted whereby the potential achievement of these various goals and their alignment to the Company's
strategic financial goals assisted in determining that the final goals were appropriate.
2 Additional severance detail under the Severance Payments and Termination Provisions section below.
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The Remuneration for the Executive Directors in 2024
Chairman and CEO Employment Agreement
On March 30, 2023, Sir Lucian Grainge entered into an extension and amendment of his prior
employment agreement with Universal Music Group, Inc. (such prior employment agreement, the
Legacy Agreement). The amended and extended employment agreement (the Current Agreement)
runs until May 1, 2028. In 2024, there were no changes to Sir Lucian Grainge's remuneration under
the Current Agreement.
Under the Current Agreement, as set out in further detail below, a significant portion of Sir
Lucian Grainge's remuneration is performance-based (i.e., subject to the achievement of annually
pre-established objectives) and share-based (i.e., aligned with Shareholders’ interests generally)
as follows:
RSU
28.6%
Salary
14,2%
Target
Annual Bonus
28.6%
Performance-Based
Compensation
57.2%
Target PSU
28.6%
Stock-Based
Compensation
57.2%
CEO ANNUAL TARGET PAY
Deputy CEO Management Services Agreement
Vincent Vallejo’s remuneration for 2024 continued to be subject to legacy arrangements
contractually agreed prior to his appointment to the Board under his management services
agreement. In 2024, there were no changes to Vincent Vallejo's remuneration under his management
services agreement.
UMG Peer Group
Below is the 2024 compensation peer group (the UMG peer group) reviewed by the Remuneration
Committee to inform its decision-making process and ensure compensation levels are set at a
competitive level against other companies in the media, entertainment and tech industries.
Altice USA, Inc. Netflix, Inc. Spotify Technology S.A.
Electronic Arts Inc. News Corporation Warner Bros. Discovery, Inc.
Endeavor Group Holdings, Inc. Paramount Global Warner Music Group Corp.
Fox Corporation Sirius XM Holdings Inc.
Live Nation Entertainment, Inc. Snap Inc.
Key Remuneration Elements and Approach to Remuneration for 2024
The following is a discussion of the key remuneration elements of 2024 for each of the
Executive Directors.
Base Salary
Base salary provides competitive fixed cash compensation reflective of the Executive Director’s
skills, experience, scope of responsibilities and the external market. The following sets out the 2024
base salary for each Executive Director, as well as their relative changes to the 2023 base salary:
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Executive Director Actual 2023
1
Actual 2024 % Change
2
Sir Lucian Grainge €7,511,849 €4,602,000 -39%
Vincent Vallejo €960,000 €960,000 0.0%
1 Reflects Sir Lucian Grainge's base salary under the Legacy Agreement for the first three months of 2023 and his base
salary under the Current Agreement effective as of April 1, 2023.
2 Sir Lucian Grainge's salary has not changed since April 2023. Any discrepancy since that date is due to the year-over-
year change in the U.S. Dollar to euro exchange rate. As noted above, the remuneration for Sir Lucian Grainge under the
Current Agreement is denominated in USD.
Short-Term Incentive
Each Executive Director is eligible for an annual short-term incentive bonus. In 2024, the Board
added Adjusted EPS Growth and non-financial strategic goals to their short-term incentive plan of
the Executive Directors.
For 2024, the annual short-term incentive bonus target for each Executive Director was as follows:
Executive Director
Target Percentage
of Base Salary Target Amount
Sir Lucian Grainge 200.0% €9,204,000
Vincent Vallejo 50.0% €480,000
For 2024, Sir Lucian Grainge was measured on the following performance metrics and
performance results:
Performance
Metric
Target
(100% Payout
1
)
Maximum
(150% Payout
1
) Actual Earned % Weighting
Weighted
Earned %
Revenue
Growth
4.8% 10.1% 7.9% 129.0% 30% 38.7%
Adjusted
EBITDA
Growth
13.0% 24.3% 13.9% 103.8% 30% 31.1%
Adjusted EPS
Growth
28.7% 41.6% 26.4% 91.3% 20% 18.3%
Strategic
Objectives
150.0% 150.0% 20% 30.0%
Total 118.1%
1 Payout percentage of target bonus amount.
For the strategic objectives performance metric, the Board assessed the Executive Directors’
contributions to the Company’s accomplishments in the following strategic areas: (i) advancement
of artist-centric principles and laying the foundation for streaming 2.0, (ii) organic investment
and strategic M&A, and (iii) defining and establishing responsible AI. With Sir Lucian Grainge’s
leadership, the Company demonstrated exceptional performance with respect to the strategic
objectives, and accordingly, Sir Lucian Grainge earned a 150% payout for the strategic objectives
performance metric.
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For 2024, Vincent Vallejo was measured on the following performance metrics and performance
results:
Performance
Metric
Target
(100% Payout
1
)
Maximum
(200% Payout
1
) Actual Earned % Weighting
Weighted
Earned %
Revenue
Growth
4.8% 10.1% 7.9% 158.1% 30% 47.4%
Adjusted
EBITDA
Growth
13.0% 24.3% 13.9% 107.7% 30% 32.3%
Adjusted EPS
Growth
28.7% 41.6% 26.4% 91.3% 20% 18.3%
Strategic
Objectives
100.0% 100.0% 20% 20.0%
Total 118.0%
1 Payout percentage of target bonus amount.
For the strategic objectives performance metric, the Board assessed the Executive Directors’
contributions to the Company’s accomplishments in the following strategic areas: (i) advancement
of artist-centric principles and laying the foundation for streaming 2.0, (ii) organic investment
and strategic M&A, and (iii) defining and establishing responsible AI. The Company demonstrated
exceptional performance with respect to the strategic objectives, and accordingly, Vincent Vallejo
earned a 100% payout for the strategic objectives performance metric.
The target for each of the Revenue Growth, Adjusted EBITDA Growth and Adjusted EPS Growth
performance metrics aligns with the Company’s annual budget, as approved by the Board. In
deviation from the Current Agreement, the Board determined, and Sir Lucian Grainge agreed, that the
threshold level of achievement required for payout of the annual short-term incentive bonus would
be 95% (in lieu of 90%) of target for the Revenue Growth performance metric which increases the
rigor for payout at threshold; and in accordance with the Current Agreement, the Board determined
that the threshold level of achievement required for payout of the annual short-term incentive
bonus would be 90% of target for the other three performance metrics, where achievement of the
threshold level in each case would result in a 50% payout, and achievement of less than the
threshold level would result in a 0% payout. In addition, the Board determined that the level of
achievement required for maximum payout of the annual short-term incentive bonus for Sir Lucian
Grainge is 150% of target in accordance with the Current Agreement and for Vincent Vallejo is
200% of target. Payout for performance between threshold and target, and target and maximum are
linearly interpolated.
Long-Term Incentive
Under the Current Agreement, Sir Lucian Grainge is entitled to an annual grant of RSUs and PSUs
with an aggregate equity value of €18,408,000, with no more than 50% of the grant being in the
form of PSUs. The first set of awards after listing were granted in 2023. The RSUs are time-based
and vest ratably over 3 years. The PSUs are performance-based where payout depends on the level
of achievement of the performance metrics that are determined by the Board. The target for each
performance metric will be no less favorable than the Company’s annual budget, as approved by
the Board. The maximum payout of the PSUs is 200% of target and the minimum payout for the
threshold level of achievement will be no less favorable than 50% for 90% achievement of the target
performance levels. Performance at less than 90% achievement of the target performance levels will
result in a 0% payout under the PSUs. Payout for the performance between threshold and target, and
target and maximum are linearly interpolated.
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In 2024, Sir Lucian Grainge received the following:
Type Grant size Performance metrics and vesting requirements
RSU €9,204,000 Requires continued services; vests ratably over 3 years
PSU €9,204,000
1
Requires continued services; vests 100% after 3 years
Metrics
˚ 50.0% to vest based on 3-year Adjusted EBITDA CAGR target
˚ 25.0% to vest based on 3-year Revenue CAGR target
˚ 25.0% to vest based on 3-year Relative TSR (Total Shareholder Return) target
1 Reflects the economic value of the underlying award as opposed to the accounting value under IFRS2.
With respect to the PSUs, the Board selected these performance metrics, which represent key
performance indicators used by the Company, to provide a foundation for sustainable long-term
growth and promote sustainable long-term value creation.
The targets for Adjusted EBITDA CAGR and Revenue CAGR are not disclosed as doing so could create
competitive harm. The Relative TSR target measures the Company’s 20-trading day average closing
share price performance against the S&P 500 Media & Entertainment Index and is as follows:
Metric Threshold (50% payout) Target (100% payout) Maximum (200% payout)
Relative TSR 25th percentile 50th percentile 75th percentile
Malus and Claw-Back
In 2024, no application of claw-back was applied on any kind of variable payments for the
Executive Directors.
Severance Payments and Termination Provisions
In 2024, no severance payments were made to the Executive Directors.
Sir Lucian Grainge
Sir Lucian Grainge is entitled to the following severance benefits under the Current Agreement
in case he terminates his employment for ‘Good Reason’, Universal Music Group, Inc. (UMG, Inc.)
terminates his employment without ‘Cause’, or in case of ‘Non-Renewal’ of the Current Agreement
(all as defined below):
1.
a lump-sum cash amount equal to Sir Lucian Grainge’s unpaid base salary earned up to the date
of his termination of employment plus an amount equal to two years of base salary;
2.
a lump-sum cash amount equal to the unpaid portion of any earned bonuses with respect to the
last fiscal year ended prior to the date of Sir Lucian Grainge’s termination of employment plus
the [€] target annual bonus for the year in which Sir Lucian Grainge’s termination of employment
occurs plus two years of the [€] target annual bonus;
3.
a lump-sum cash amount equal to the amount that UMG, Inc. would have paid during the 2 years
following Sir Lucian Grainge’s termination of employment (based on rates in effect at the time of
termination of employment) to provide Sir Lucian Grainge with the benefits he would have been
entitled to receive under the additional pension allowance and the broad base of benefit plans
in which Sir Lucian Grainge may participate, provided that such amount will not include any
vacation benefits;
4.
each equity award outstanding at the termination of Sir Lucian Grainge’s employment, with each
such equity award vesting on a pro rata basis in accordance with the terms of the applicable
equity award agreement, except that Sir Lucian Grainge will be deemed to be continuously
employed for a period of 2 years from the date of termination for ’Good Reason’, ’without Cause’
or following a ’Non-Renewal’, with any performance-based equity awards continuing to vest for a
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
period of 2 years from the date of termination and such vested portion of applicable performance-
based equity awards to be settled at target.
‘Good Reason’ includes:
1.
removal of Sir Lucian Grainge from his position as an Executive Director or as Chairman and CEO
of UMG, Inc. or the Company resulting in a material diminution in Sir Lucian Grainge’s authority,
duties or responsibilities, or in the budget over which Sir Lucian Grainge retains authority;
2.
the requirement for Sir Lucian Grainge to report to anyone with materially less authority, duties
or responsibilities;
3.
a material decrease in Sir Lucian Grainge’s authority, duties or responsibilities, including, but not
limited to, a material adverse change to Sir Lucian Grainge’s authority, duties or responsibilities as
they relate to managing Sir Lucian Grainge’s direct reports or Sir Lucian Grainge’s involvement in
setting UMG’s annual budget or UMG’s strategy;
4.
a reduction in Sir Lucian Grainge’s base salary or target annual bonus or annual equity award
constituting a material diminution in Sir Lucian Grainge’s base compensation as determined for
purposes of Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations
and guidance promulgated thereunder;
5.
the requirement that Sir Lucian Grainge’s principal place of employment be located other than at
the principal offices of UMG, Inc. located in Los Angeles, California, provided that such change in
location is a material change in the geographic location at which Sir Lucian Grainge must provide
his services as determined for purposes of Section 409A of the Internal Revenue Code of 1986, as
amended, and the regulations and guidance promulgated thereunder;
6.
a material breach by UMG, Inc. of the Current Agreement (whether or not otherwise set forth in
clauses (1) — (5) above);
7.
a ‘Change in Control’.
A ’Change in control’ is defined as a change in the ownership of the Company, which occurs on the
date that any one person would be entitled to, directly or indirectly, exercise at least 30% of the votes
in a General Meeting (Predominant Control) (which would pursuant to Dutch law trigger a mandatory
public takeover offer for all of the outstanding Shares); provided, however that no change in control
will be considered to exist (i) if the voting power of any one person, or more than one person acting
in concert, who at the date of the Current Agreement was already entitled to exercise 30% or more
of the votes in a General Meeting increases, and (ii) if the person who acquired Predominant Control
loses such Predominant Control within 30 days of acquiring it, unless the Person who acquired
Predominant Control has exercised its voting rights in that 30-day period.
‘Cause’ has a commonly used meaning.
‘Non-Renewal’ means the expiration of the Current Agreement, with UMG, Inc. not having made an
offer of employment on terms at least as favorable as the terms set forth in the Current Agreement at
least 90 days before the expiration date of the Current Agreement.
In addition, Sir Lucian Grainge cannot compete against UMG for 24 months following any termination
of employment (whether by UMG or by Sir Lucian Grainge) and following expiration of the term of the
Current Agreement. In cases where Sir Lucian Grainge is entitled thereto, the severance payment is
also considered consideration for the non-competition.
Vincent Vallejo
Vincent Vallejo’s management services agreement converted into an indefinite-term agreement on
October 1, 2023. His management services agreement does not provide for a severance payment, but
he is eligible for severance under Dutch law.
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Total Remuneration
1
Total remuneration of the Executive Directors is presented in the table below. The equity
remuneration in the table below reflects the grant value of the awards.
Name
Reported
year
Fixed remuneration Variable remuneration Benefits and one-off amounts
Total
remuneration
1
Proportion
fixed – variable
remunerationBase Salary
Short-Term
Incentive
Long-
Term Incentive
One-Time
Transition Award
Retirement
Benefits
Other
Benefits
Other
Payments
Sir Lucian Grainge,
Chairman and CEO
2
2024 €4,602,000 €10,869,924 €18,408,000
3
€0 €294,528 €2,381,640 €0 €36,556,092 20% / 80%
2023 €7,511,849 €15,163,413 €18,481,370
4
€92,406,852
5
€295,702 €2,973,670 €1,981,000
6
€138,813,856 8% / 92%
Vincent Vallejo,
Deputy CEO
2024 €960,000 €566,400 €0 €0 €41,053 €57,834 €0 €1,625,286 65% / 35%
2023 €960,000 €815,040 €0 €0 €41,053 €57,596 €948,575
7
€2,822,264 38% / 62%
1 Sir Lucian Grainge and Vincent Vallejo participated in Vivendi share schemes prior to the Listing that are not included. Reference is made to pages 131 to 133 of the Company's prospectus dated September 14, 2021, which is available on the investor
relations part of the UMG website (the Prospectus) for further details.
2 Sir Lucian Grainge’s remuneration has been converted from US dollars into euros using a monthly average FX rate of 0.924 for FY23 and 0.9204 for FY24.
3 For 2024, Sir Lucian Grainge's Long-Term Incentive reflects the grant value as of the grant date (March 31, 2024 at a grant price of €27.88 per RSU/PSU.
4 For 2023, Sir Lucian Grainge’s Long-Term Incentive and One-Time Transition Award reflect the grant value as of the grant date (April 30, 2023 at a grant price of €19.81). As of December 31, 2024, Sir Lucian Grainge has vested 730,478 RSUs.
5 The One-Time Transition Award is not applicable in subsequent years. As of December 31, 2024, 718,743 PSOs were exercisable as those PSOs had vested due to the passage of time and had become eligible for exercise due to the first share price
hurdle achieved €26.50.
6 Prior to the Listing, Vivendi granted equity awards in the form of performance shares payable in Vivendi stock the value of which was not adjusted for the UMG Listing. A Special One-Time Award was granted to make Sir Lucian Grainge whole for the
loss in value due to the impact of the spin-off in connection with the Listing. The amount reflects the grant value of this Special One-Time Award which was granted on April 30, 2023 at a grant price of €19.81 per RSU.
7 Amount reflects a cash retention payment and the grant value of a Special One-Time Award which was granted on April 30, 2023 at a grant price of €19.81 per RSU.
1
The Remuneration Table includes information and figures that are audited as part of Note 25 of the Annual Consolidated Financial Statements and Note 11 of the Company Financial Statements.
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Share-Based Remuneration of the Executive Directors
The total share-based remuneration of the Executive Directors awarded during 2024 and outstanding
as of December 31, 2024 is presented in the table below:
Name of
Director position
The main conditions of share award plans
Expire
Date
Strike
Price
Information regarding reported financial year
Opening balance During the year Closing Balance
Specification
of plan
Award
type
Performance
period
Award
date
Vesting
date
End of
holding
period
1
Units awarded
at the beginning
of the year
Units
awarded
Dividend
Equivalents
Added
Units
vested
Units subject to
a performance
condition
Units awarded
and unvested as
of year end
Units subject
to a holding
period
Sir Lucian Grainge,
Chairman and CEO
2022 UMG Global
Equity Plan
RSU N/A 4/30/2023 4/30/2024
2
N/A N/A N/A 30,738 0 0 30,738 0 0 N/A
RSU N/A 4/30/2023 4/30/2024
2
N/A N/A N/A 30,738 0 0 30,738 0 0 N/A
RSU N/A 4/30/2023 4/30/2024
2
N/A N/A N/A 40,984 0 0 40,984 0 0 N/A
RSU N/A 4/30/2023 4/30/2026
3
N/A N/A N/A 471,014 0 6,229 157,004 0 320,239 N/A
PSU
1/1/2023 -
12/31/2025
4/30/2023 4/30/2026
4
N/A N/A N/A 471,014 0 9,343 0 480,357 480,357 N/A
RSU N/A 4/30/2023 4/30/2028
5
N/A N/A N/A 2,355,065 0 37,374 471,013 0 1,921,426 N/A
PSO N/A 4/30/2023 4/30/2027
6
N/A 4/30/2033 €19.81 8,624,917 0 0 718,743
7
8,624,917 7,906,174 N/A
RSU N/A 3/31/2024 3/31/2027
3
N/A N/A N/A 0 331,774 6,581 0 0 338,355 N/A
PSU
1/1/2024 -
12/31/2026 3/31/2024 3/31/2027
4
N/A N/A N/A 0 331,774 6,581 0 338,355 338,355 N/A
Vincent Vallejo,
Deputy CEO
2022 UMG Global
Equity Plan
RSU N/A 4/30/2023 4/30/2024
2
N/A N/A N/A 7,685 0 0 7,685 0 0 N/A
1 As noted in the Corporate Governance section under ”Compliance with the Code”, Shares, once vested, are not subject to a holding period.
2 Special One-Time Award.
3 RSUs awarded as part of Sir Lucian Grainge's Long-Term Incentive, vesting 1/3 annually.
4 PSUs awarded as part of Sir Lucian Grainge's Long-Term Incentive which vest 100% after 3 years if performance metrics are met.
5 50% of the One-Time Transition Award, which vests 1/5 annually.
6 50% of the One-Time Transition Award, which vests 1/4 annually and are only exercisable if the following share price hurdles are met: 1/3 at €26.50, 1/3 at €30.00, and 1/3 at €38.00.
7 The first share price hurdle of €26.50 was achieved on January 29, 2024. These PSOs are exercisable as they have vested due to the passage of time and exercisable have become eligible due to the first share price hurdle having been achieved.
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Remuneration Expense and Company Performance Development
The overview below provides insight into the development of the remuneration expense of the
Executive Directors, Company performance and employee pay as of the Listing in 2021. For Sir Lucian
Grainge, the year-over-year increase of 8% in total remuneration expense from 2023 to 2024 was
primarily driven by the 2024 full-year impact of his equity compensation expense. In 2023, the
share-based compensation expense for Sir Lucian Grainge had a partial year impact consistent
with when he executed his Current Agreement. Additionally, the lower average annual remuneration
expense on an FTE basis of employees decreased by 13% primarily due to the decrease in share-
based compensation expense and a decrease in headcount.
Element 2021 2022 2023
1
2024
1
Remuneration Expense
Chairman and CEO €40,861,707 €47,291,068 €64,274,250 €69,292,930
Annual change Not applicable 16%
36% 8%
Deputy CEO
2
€2,630,851 €2,624,471 €2,686,990 €1,625,286
Annual Change Not applicable 0% 2% -40%
Company performance
Adjusted EBITDA (in millions of euros) €1,788 €2,135 €2,369 €2,661
Annual Change Not applicable 19% 11% 12%
Average annual remuneration expense on an FTE basis of employees
Average annual
3
€131,961 €142,039 €180,684 €157,265
Annual Change Not applicable 8% 27% -13%
Internal Pay Ratio 310 333 356 441
Annual Change N/A 8% 7% 24%
1 The equity remuneration expense in this table is based on the annual total remuneration expense as reported
in the Consolidated Financial Statements included in the Annual Report in accordance with IFRS. In contrast, the
equity remuneration in the Total Remuneration Table reflects the grant value of the equity awards and not the IFRS
equity expense.
2 The Deputy CEO was employed by UMG effective April 2021. Accordingly, the remuneration expense for 2021 has been
updated and annualized from €2,185,698 to €2,630,851 for year-over-year comparison purposes.
3 Reflects the total personnel costs reported in Note 5 of the Consolidated Financial Statements, adjusted to be
comparable with the remuneration expense of Executive Directors disclosed above. The total personnel costs include
all remuneration components (such as fixed salary, variable remuneration in cash, the share-based expense part of
the remuneration, social security contributions, pensions, expense allowance, etc.) as included in the Consolidated
Financial Statements. The average annual remuneration expense of the employees is determined by dividing the total
personnel costs by the average number of FTEs during the financial year.
The Remuneration for the Non-Executive Directors in 2024
The General Meeting on May 16, 2024 adopted a revised version of the remuneration policy for
the Non-Executive Directors (the Non-Executive Directors’ Remuneration Policy), outlining the
framework to determine the remuneration for the Non-Executive Directors. The objective of the Non-
Executive Directors’ Remuneration Policy is to provide a remuneration structure that allows UMG
to attract, motivate and retain highly qualified Non-Executive Directors who possess the necessary
leadership skills to promote the Company’s strategy, long-term interests and sustainability. In order
to ensure that the Non-Executive Directors’ Remuneration Policy is aligned with UMG’s identity,
mission and core values, it is built on the following principles:
■
The program is simple and transparent;
■
Non-Executive Directors should be compensated competitively against market, considering the
level of work required for a company that is similar in size, scope, and complexity to UMG;
■
Non-Executive Directors’ remuneration is differentiated, as appropriate, for differing Board
committee responsibilities and time commitments;
■
In order to ensure independent supervision, remuneration of Non-Executive Directors is fixed and
not dependent on the Company’s financial results or the attainment of performance conditions.
At the beginning of 2024, the Remuneration Committee conducted a comprehensive review of
the remuneration structure for the Non-Executive Directors, and the Non-Executive Directors’
Remuneration Policy that had been in effect since September 2021. With the assistance of the
Remuneration Committee's independent compensation consultant, the Remuneration Committee
MUSIC IS UNIVERSAL
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
evaluated the market competitiveness of the remuneration program for the Non-Executive Directors
against the UMG peer group (as defined under "UMG peer group"). The remuneration for the Non-
Executive Directors fell significantly below the UMG peer group. This disparity was largely due to
the absence of equity remuneration for the Non-Executive Directors, which constitutes a significant
portion of pay among the UMG peer group. In order to align the remuneration of the Non-Executive
Directors more closely with the UMG peer group and to enhance UMG’s ability to attract, motivate
and retain highly qualified individuals, the Board, at the recommendation of the Remuneration
Committee, proposed a revision to the Non-Executive Directors’ Remuneration Policy that had been
in effect since September 2021 at the annual General Meeting held on May 16, 2024 to increase the
Non- Executive Directors’ remuneration by annually granting a fixed amount of RSUs in euros.
The Non-Executive Directors' Remuneration Policy was amended and approved by the General
Meeting with a 98.26% majority of the votes cast to include RSUs as part of the remuneration
structure for the Non-Executive Directors.
Each annual grant of RSUs shall be subject to the terms and conditions set forth in the Non-
Executive Directors’ Remuneration Policy. Vesting of the RSUs shall not be dependent on the
Company’s financial results or the attainment of performance conditions.
The revised Non-Executive Directors’ remuneration for serving on the Board and Board committees
is as follows:
Role
Non-
Executive Director
Chairman of
the Board
Member of a
Board Committee
Chair of a
Board Committee
Cash Retainer €90,000 €50,000 €20,000 €10,000
Annual RSU Grant €160,000 €50,000 - -
Share Ownership Policy for Non-Executive Directors
In order to ensure alignment between the interests of the Non-Executive Directors and the
Company’s sustainable long-term value creation, the Board adopted a share ownership policy for
the Non-Executive Directors, whereby the Non-Executive Directors may in principle not transfer or
otherwise dispose of the Shares that were received by them upon vesting of the RSUs until they meet
certain minimum ownership guidelines.
Pursuant to the share ownership policy, each Non-Executive Director who receives remuneration in
the form of RSUs is required to maintain beneficial ownership of a number of RSUs so granted to
him or her and/or Shares so received by him or her upon vesting of the RSUs with a value equal
to 4 times his or her annual cash retainer for serving as a Non-Executive Director, not including
any additional retainer paid for service on any Board committee, or as Chairman of the Board or
as chair of any Board committee (the
Minimum Ownership Guideline) for so long as he or she is
a Non-Executive Director. Until a Non-Executive Director meets the Minimum Ownership Guideline,
such Non-Executive Director shall not be permitted to transfer or otherwise dispose of Shares so
received, except that a Non-Executive Director may sell Shares to the extent necessary to pay any tax
imposed on vesting of the RSUs and receipt of the Shares.
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Total Remuneration
Total remuneration of the Non-Executive Directors paid in 2024 is presented in the table below:
Non-Executive
Director
Commencement
Date Board
1
Audit
Committee
1
Remuneration
Committee
1
Nomination
Committee
1
2024 Cash
Retainer (in €)
2024 Equity
Remuneration (in €)
2
2024 Total
Remuneration (in €)
A.R.J.C. Fiévet
3
9/20/2021 52,692 0 52,692
C.F.L. Lawson-Hall 9/20/2021 Member Member 110,000 159,977 269,977
C.M.C. Bolloré 5/12/2022 Member Member 110,000 159,977 269,977
E. Sprunk 5/16/2024 Member Member Member 81,429 159,977 241,406
H. Saban 5/11/2023 Member 90,000 159,977 249,977
J.G. Mitchell
4
9/20/2021 Member Member 0 0 0
L.A.J. Van Os 9/20/2021 Member Chair 120,000 159,977 279,977
M. Frerejean- Taittinger 9/20/2021 Member Member Chair 140,000 159,977 299,977
M. Ginsberg 5/16/2024 Member Member Chair 87,692 159,977 247,669
M.L. Doherty
4
9/20/2021 Member Member 0 0 0
N.A. Avant 5/12/2022 Member Member 110,000 159,977 269,977
S.L. Lansing 5/12/2022 Chair Member Member 180,000 209,989 389,989
W.A. Ackman
4
5/12/2022 Member Member 0 0 0
1 Composition of the Board and Board committees as of December 31, 2024.
2 Variances in equity remuneration awarded compared to the amounts noted in the Non-Executive Directors Remuneration Policy (€160,000 for Non-Executive Directors and an additional €50,000 for the Chairman of the Board) is due to rounding for
partial shares.
3 Antoine Fiévet acted as Non-Executive Director and Chair of the Remuneration Committee until the close of the annual General Meeting held on May 16, 2024, on which date his term ended. He decided not to stand for reappointment.
4 Voluntarily elected to not receive any Non-Executive Director remuneration in 2024.
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Remuneration
Development
2024 vs.
2023
1
2023 vs.
2022
1
2022 vs.
2021
1
A.R.J.C. Fiévet
2
-54% 5% 0%
C.F.L. Lawson-Hall 145% -8% 0%
C.M.C. Bolloré 145% 0% N/A
E. Sprunk N/A N/A N/A
H. Saban 178% N/A N/A
J.G. Mitchell
3
N/A N/A N/A
L.A.J. Van Os 133% -8% 0%
M. Frerejean-Taittinger 114% 0% 0%
M. Ginsberg N/A N/A N/A
M.L. Doherty
3
N/A N/A 0%
N.A. Avant 145% 0% N/A
S.L. Lansing 122% 59% N/A
W.A. Ackman
3
N/A N/A N/A
1 2023, 2022, and 2021 remuneration amounts have been annualized for
purposes of calculating the year-over-year change.
2 Antoine Fiévet acted as Non-Executive Director and Chair of the
Remuneration Committee until the close of the annual General Meeting held
on May 16, 2024, on which date his term ended. He decided not to stand
for reappointment.
3 Voluntarily elected to not receive any Non-Executive Director remuneration in
2024, 2023, 2022, and, if applicable, 2021.
The material increases shown above are a function of the RSU awards introduced after the new
Non-Executive Directors’ Remuneration Policy was approved at the 2024 AGM.
The Non-Executive Directors’ remuneration is fixed and not dependent on the Company’s financial
results or the attainment of performance conditions. The Non-Executive Directors are also entitled
to reimbursement of reasonable expenses incurred in connection with the performance of their
duties for the Company. The Non-Executive Directors are not entitled to receive any compensation
on termination of their appointment and are not entitled to participate in the Company’s bonus or
pension schemes.
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Share-Based Remuneration of the Non-Executive Directors
The total share-based remuneration of the Non-Executive Directors awarded during 2024 and
outstanding as of December 31, 2024 is presented in the table below:
Name of Director,
position
The main conditions of share award plans Information regarding reported financial year
Opening balance During the year Closing Balance
Specification
of plan
Award
type
Award
date
Vesting
date
End
of holding
period
1
Units awarded at
the beginning of
the year
Units
awarded
Units
vested
Units subject to
a performance
condition
Units awarded
and unvested as
of year end
Units subject to
a holding
period
C.F.L. Lawson-Hall,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
C.
M.C. Bolloré,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
E. Sprunk,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
H. Saban,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
L.A.J. Van Os,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
M. Frerejean-Taittinger,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
M. Ginsberg,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
N.A. Avant,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 5,681 0 0 5,681 N/A
S.L. Lansing,
Non-Executive Director
2022 UMG Global
Equity Plan
RSU 5/16/2024 5/16/2025 N/A 0 7,457 0 0 7,457 N/A
1 As noted in the Corporate Governance section under ‘Compliance with the Code’, Shares, once vested, are not subject to a holding period.
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Other items
2023 Remuneration Report Voting Results
At the Annual General Meeting held on May 16, 2024, 70.95% of the Shareholders supported the 2023
remuneration report compared to the 58.96% vote on the 2022 remuneration report.
After the annual General Meeting held on May 16, 2024, UMG engaged with Shareholders to
understand their perspective on the 2023 remuneration report and solicit overall feedback about
the Executive and Non-Executive Director pay design and practices. Shareholders expressed their
desire to include an earnings per share performance metric in the incentive plans of the Executive
Directors, and as a result, the Board responded by approving the addition of an Adjusted EPS
Growth performance metric to their short-term incentive plan. Separately, a non-financial Strategic
Objectives performance metric was also added to the short-term incentive plan.
Deviation from Executive Directors' or Non-Executive Directors' Remuneration Policy
UMG did not deviate from the Executive Directors’ or Non-Executive Directors’ Remuneration Policies.
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REMUNERATION REPORT
Financial Statements
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
CONSOLIDATED STATEMENTS
CONTENTS OF CONSOLIDATED STATEMENTS
Consolidated Statement of Profit or Loss 181
Consolidated Statement of Comprehensive Income 182
Consolidated Statement of Financial Position 183
Consolidated Statement of Cash Flows 184
Consolidated Statement of Changes in Equity 185
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 187
Note 1. General information 187
Note 2. Basis of preparation 187
Note 3. Segment data 200
Note 4. Acquisitions and divestments 204
Note 5. Cost of revenues and selling, general and
administrative expenses 204
Note 6. Financial income and expenses 205
Note 7. Income taxes 206
Note 8. Earnings per share 209
Note 9. Goodwill 210
Note 10. Content assets (catalogues and royalty advances) and
other intangibles 211
Note 11. Property, plant and equipment 213
Note 12. Leases 214
Note 13. Investments in equity affiliates 214
Note 14. Capital and financial risk management 215
Note 15. Trade and other receivables 219
Note 16. Trade and other accounts payable 220
Note 17. Cash position and borrowings 220
Note 18. Contractual obligations and other commitments 222
Note 19. Financial assets and liabilities 223
Note 20. Equity 225
Note 21. Expenses and income directly recognized in other
comprehensive income 225
Note 22. Provisions 226
Note 23. Post-retirement employee benefits 226
Note 24. Share-based compensation plans 229
Note 25. Related parties 232
Note 26. Litigation 234
Note 27. List of consolidated entities 234
Note 28. Statutory auditors fees 234
Note 29. Audit exemptions 234
Note 30. Subsequent events 235
MUSIC IS UNIVERSAL Annual Report 2024 | 180
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
CONSOLIDATED FINANCIAL STATEMENTS FOR THE
YEAR ENDED DECEMBER 31, 2024
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
| Revenues | 3 | ||
Cost of revenues | 5 | ( | ( |
Selling, general and administrative expenses | 5 | ( | ( |
Amortisation and impairment losses on intangible assets | 9, 10 | ( | ( |
| Operating profit | 3 | ||
Financial income | 6 | ||
Financial expenses | 6 | ( | ( |
Income/(loss) from equity affiliates | 13 | ||
| Profit before income taxes | |||
Income taxes | 7 | ( | ( |
| Net profit | |||
| Of which: | |||
Net profit attributable to equity holders of the parent | |||
Net profit attributable to non-controlling interests | |||
| Earnings per share (in euros) | |||
Earnings for the period attributable to equity holders of the parent - basic | 8 | ||
Earnings for the period attributable to equity holders of the parent - diluted | 8 |
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
| Net profit | |||
Actuarial gains/(losses) related to employee defined benefit plans, net of tax | ( | ( | |
Financial assets at fair value through other comprehensive income, net of tax | ( | ( | |
| Items not subsequently reclassified to profit or loss, net of tax | ( | ( | |
Foreign currency translation adjustments | ( | ||
Other comprehensive income/(loss) from equity affiliates, net of tax | ( | ||
Net gain/(loss) on hedge of net investment | |||
| Items to be subsequently reclassified to profit or loss, net of tax | ( | ||
| Other comprehensive income/(loss), net of tax | 21 | ( | |
| Total comprehensive income, net of tax | |||
Of which Total comprehensive income attributable to equity holders of the parent | |||
| Total comprehensive income attributable to non-controlling interests |
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
Goodwill | 9 | ||
Non-current royalty advances | 3, 10 | ||
Catalogues | 3, 10 | ||
Other intangible assets | 3, 10 | ||
Property, plant and equipment | 11 | ||
Right of use assets | 12 | ||
Investments in equity affiliates | 13 | ||
Non-current financial assets | 19 | ||
Deferred income tax assets | 7 | ||
Other non-current assets | |||
| Non-current assets | |||
Inventories | |||
Current tax receivables | 7 | ||
Current royalty advances | 3, 10 | ||
Other current financial assets | 19 | ||
Trade and other receivables | 14, 15 | ||
Cash and cash equivalents | 17 | ||
| Current assets | |||
| TOTAL ASSETS |
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
Shareowners equity | 20 | ||
Non-controlling interests | |||
| Total equity | |||
Non-current provisions | 22 | ||
Long-term borrowings and other financial liabilities | 17 | ||
Deferred tax liabilities | 7 | ||
Long-term lease liabilities | 12 | ||
Other non-current liabilities | 19 | ||
| Non-current liabilities | |||
Current provisions | 22 | ||
Short-term borrowings and other financial liabilities | 17 | ||
Trade and other payables | 14, 16 | ||
Short-term lease liabilities | 12 | ||
Current tax payables | 7 | ||
| Current liabilities | |||
| Total liabilities | |||
| TOTAL EQUITY AND LIABILITIES |
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
CONSOLIDATED STATEMENT OF CASH FLOWS
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
| Operating activities | |||
Operating profit | 3 | ||
Adjustments | 14 | ||
Royalty advances payments, net of recoupments | ( | ( | |
| Gross cash provided by/(used for) operating activities before income tax paid | |||
Other changes in net working capital | 14 | ( | |
| Net cash provided by/(used for) operating activities before income tax paid | |||
Income tax paid | 7 | ( | ( |
| Net cash provided by/(used for) operating activities | |||
| Investing activities | |||
Catalogue investments | ( | ( | |
Other intangible assets investments | ( | ( | |
Capital expenditures | 11 | ( | ( |
Purchases of consolidated companies, after acquired cash | ( | ( | |
Investments in equity affiliates | ( | ( | |
Purchase of financial assets | ( | ( | |
| Investments | ( | ( | |
Proceeds from sales of property, plant, equipment and intangible assets | |||
Proceeds from sales of consolidated companies, after divested cash | |||
Proceeds from sale of financial assets | |||
| Divestitures | |||
Dividends received from equity affiliates | 13 | ||
Dividends received from investments | |||
| Net cash provided by/(used for) investing activities | ( | ( |
| Year ended December 31, | ||||
(millions of euros) | Note | 2024 | 2023 | |
| Financing activities | ||||
Distributions to shareowners | 20 | ( | ( | |
Dividends paid by consolidated companies to their non- controlling interests | ( | ( | ||
| Transactions with shareowners | ( | ( | ||
Proceeds from borrowings | ||||
Repayments of borrowings | ( | ( | ||
Interest, net | ( | ( | ||
Other cash items related to financing activities | ( | |||
| Transactions on borrowings and other financial liabilities | ( | |||
Repayment of lease liabilities | 12 | ( | ( | |
Payment of interest of lease liabilities | 12 | ( | ( | |
| Net cash provided by/(used for) financing activities | ( | ( | ||
| Net change in cash and cash equivalents | ( | |||
Foreign currency translation adjustments | ( | |||
| Change in cash and cash equivalents | 17 | ( | ||
| Cash and cash equivalents | ||||
At beginning of the period | 17 | |||
At end of the period | 17 |
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| 184
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
| Note | Number of shares | Share capital | Additional paid- | Treasury shares | Retained | Shareowners equity | Non- | Total | ||
| (millions of euros) | (in thousands) | in capital | earnings | Controlling interest | equity | |||||
| BALANCE AS OF DECEMBER 31, 2023 | 1,821,665 | ( | ( | |||||||
Net profit | - | |||||||||
Income and expenses directly recognized in other comprehensive income, net of tax | 21 | - | ||||||||
| TOTAL COMPREHENSIVE INCOME | - | |||||||||
Dividends paid and payable by UMG N.V. | 20 | - | ( | ( | ( | ( | ||||
Share-based compensation plans | 24 | 7,616 | ||||||||
NCI on acquired business 1 | - | |||||||||
Acquired/(exercised) put options over NCI 1 | - | ( | ( | ( | ||||||
| TOTAL CHANGES OVER THE PERIOD | 7,616 | ( | ( | ( | ( | |||||
| BALANCE AS OF DECEMBER 31, 2024 | 1,829,281 | ( | ( |
1 These line items relate to non-controlling interests arising from business combinations and certain acquired catalogues held in entities that are not businesses. In some cases, NCI holders are granted put options enabling them to sell their shares
to UMG at a specified date or time period. Resulting transactions are included at line items Acquired/(exercised) put option over NCI and Recognition of put option liability on NCI.
MUSIC IS UNIVERSAL Annual Report 2024 | 185
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Note | Number of shares | Share capital | Additional paid- | Treasury shares | Retained | Shareowners equity | Non- | Total | ||
| (millions of euros) | (in thousands) | in capital | earnings | Controlling interest | equity | |||||
| BALANCE AS OF DECEMBER 31, 2022 | 1,813,513 | ( | ( | |||||||
Net profit | - | |||||||||
Income and expenses directly recognized in other comprehensive income, net of tax | 21 | - | ( | ( | ( | |||||
| TOTAL COMPREHENSIVE INCOME | - | |||||||||
Dividends paid and payable by UMG N.V. | 20 | - | ( | ( | ( | ( | ||||
Share-based compensation plans | 24 | 8,152 | ||||||||
NCI on acquired catalogue 1 | - | |||||||||
Recognition of put option liability on NCI 1 | - | ( | ( | ( | ||||||
| TOTAL CHANGES OVER THE PERIOD | 8,152 | ( | ( | ( | ||||||
| BALANCE AS OF DECEMBER 31, 2023 | 1,821,665 | ( | ( |
1 These line items relate to non-controlling interests arising from business combinations and certain acquired catalogues held in entities that are not businesses. In some cases, NCI holders are granted put options enabling them to sell their shares
to UMG at a specified date or time period. Resulting transactions are included at line items Acquired/(exercised) put option over NCI and Recognition of put option liability on NCI.
MUSIC IS UNIVERSAL Annual Report 2024 | 186
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 1.
General information
the Netherlands and listed on Euronext Amsterdam under the symbol ‘UMG.AS’. As used herein, the
term UMG ("The Group") is used for Universal Music Group N.V. (‘the Company’) and its subsidiaries
within the meaning of Section 2:24b of the Dutch Civil Code. UMG’s statutory seat is located in
Amsterdam and its principal office is located at:
Note 2. Basis of preparation
2.1.
Statement of compliance
The Consolidated financial statements have been prepared in accordance with IFRS Accounting
Standards (IFRS) as issued by the International Accounting Standards Board (IASB), IFRS as endorsed
by the European Union (EU) and comply with the statutory provisions of Part 9, Book 2 of the Dutch
Civil Code. IFRS as endorsed by the EU differs in some respects from IFRS as issued by the IASB. The
differences have no impact on the Consolidated financial statements for the years presented.
The Consolidated financial statements are prepared by the Board of Management of UMG and
authorized for issue on March 27, 2025 and will be submitted for adoption to the Annual General
Meeting of Shareholders on May 14, 2025.
Seperation from Vivendi
Until February 26, 2021, the arrangement that constituted the combined UMG Group was not a legal
entity in its own right and was made up of entities under the common control of Vivendi. Until this
date, UMG’s scope of combination principally comprised the entities held directly and indirectly by
UMG Inc. and UIM B.V.
On February 26, 2021, in UMG B.V.’s Consolidated financial statements, the contribution of
€33,000 million was directly recorded as an increase in equity attributable to UMG B.V. shareowners
(€18,500 million in share capital and €14,500 million in additional paid-in capital), and the
contribution of €33,000 million was fully neutralized in UMG B.V.’s retained earnings. The
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
reorganization of its shareholding structure, which is a common control business combination, has
no impact on UMG’s scope of combination or consolidation.
On September 21, 2021, the shares of Universal Music Group N.V. (UMG N.V.) started trading on the
regulated market of Euronext Amsterdam. Vivendi completed the distribution in kind of UMG shares
to Vivendi shareholders on the basis of one UMG N.V. share for every eligible Vivendi share. The
detachment date (ex-date) of the distribution in kind was September 21, 2021. Settlement occurred on
September 23, 2021. UMG B.V. was converted to UMG N.V. on this date accordingly.
Significant events in the period and accounting estimates and judgements
Impact of global events
Global economic conditions continue to show a high degree of uncertainty because of several
factors, including recent geopolitical events and conflicts. Inflation rates and interest rates globally
remain high, with associated impacts on commodity prices, foreign exchange rates and other
macroeconomic factors. Nevertheless, UMG’s operations continue to demonstrate resilience in the
face of these economic headwinds. UMG will continue to monitor economic developments and the
impact on the Group’s operations and financial position.
Climate change
UMG considered the impact of climate-related risks on the financial reporting judgements, estimates
or assumptions used in preparing the Consolidated financial statements with no material impact
identified for the year ending 31 December 2024.
UMG identified and assessed climate related risks as described in our Sustainability Statement
(see “Identification of Impacts, Risks, and Opportunities Related to Specific Topical Standards”). This
assessment concluded that there were no climate-related risks resulting in high or critical impact
to UMG’s operations or value chain across the evaluated scenarios and time horizons. Therefore,
UMG does not expect that climate change-related risks will have significant impact on the Group and
would qualitatively influence management's decisions.
In 2023 UMG’s near-term science-based targets (designed to measure the performance of our
climate-related reduction initiatives) were approved by the SBTi. UMG has assessed the short term
financial impact of achieving the near-term emissions targets and these would not have a material
impact on the financial statements.
For for details on UMG’s near-term emissions targets and climate-related risks refer to the
Sustainability Statement.
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| Area | Significant judgement | Note |
| Significant judgement is required to identify performance obligations | ||
| under contracts with customers, whether these performance | 2.3.5. Revenues and | |
| Revenue | obligations are satisfied at a point of time or over time, and | associated costs |
| probability that collectability is assured and significant reversal will | ||
| not occur. | ||
| Uncertain tax | Judgement in assessing the uncertainty of whether it is probable that | |
| positions and | a taxation authority will accept or revise the uncertain tax treatment | 2.3.20. Income taxes |
| deferred taxes | and, future results enabling realisation of deferred taxes. | |
| Lease liabilities and | Judgement in determining the lease term of contracts with renewal | |
| right-of-use assets | and termination options at the commencement date of each | |
| lease contract. |
| Area | Significant estimate | Note |
| Revenue | Estimation on the timing of the consequent usage and the amounts | 2.3.5. Revenues and |
| that are probable to be collected. | associated costs | |
| Intangible assets, | Assumptions relating to impairment tests performed on each of the | 2.3.7. Goodwill and |
| including goodwill | Group’s cash-generating units (CGUs) or intangible assets, future | 2.3.8. Content assets |
| and content assets | cash flows and discount rates are updated annually. Estimation of | and other intangibles |
| (remaining) useful life for intangible assets, other than goodwill. | ||
| Provisions | Estimating the likelihood and timing of potential cash flows relating | 2.3.18. Provisions |
| to royalty claims and litigation. |
| Area | Significant estimate | Note |
| Artist | Estimates of the future performance of artists and repertoire owners | 2.3.8. Content assets |
| royalty advances | who are paid advances that are recognized in the Consolidated | and other intangibles |
| Statement of Financial Position. | ||
| Share- | Estimation of the grant date fair value and number of | 2.3.21. Share- |
| based payments | equity instruments. | based payments |
| Pension liability | Assumptions for discount rates, inflation, future pension increases | 2.3.19. Employee |
| and life expectancy to calculate the defined benefit obligation. | benefit plans |
2.3. Material accounting policy information
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Segment EBITDA and Adjusted EBITDA are included in these disclosures because they are
the primary measures of profit or loss used by UMG Management to assess each segment’s
performance and make decisions about allocating resources. EBITDA and Adjusted EBITDA are non-
IFRS measures defined in the Appendix of the Annual Report accompanying these Consolidated
financial statements.
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Main aggregates of the Statement of profit or loss
| Elimination | |||||||
| Note | Recorded | Music | Merchandising | Corporate | of | Total | |
| Music | Publishing | and other | centre | intersegment | |||
| (millions of euros) | transactions | ||||||
| Year ended December | |||||||
| 31, 2024 | |||||||
External revenue | 8,900 | 2,100 | 834 | - | - | 11,834 | |
Intercompany revenue | 1 | 21 | 8 | - | (30) | - | |
| Revenues | 8,901 | 2,121 | 842 | - | (30) | 11,834 | |
| Adjusted EBITDA | 2,275 | 511 | 43 | (168) | - | 2,661 | |
| Non-cash share-based | 24 | (202) | (25) | (1) | (101) | - | (329) |
| compensation expense | |||||||
| EBITDA | 2,073 | 486 | 42 | (269) | - | 2,332 | |
Amortisation and depreciation expense | (205) | (161) | (2) | (41) | - | (409) | |
Restructuring expenses | (138) | (4) | (2) | (25) | - | (169) | |
| Gain/(loss) on sale | 24 | - | - | (1) | - | 23 | |
| of assets | |||||||
| Impairment reversal/ | |||||||
(charge) on intangible assets | (2) | - | - | - | - | (2) | |
| Operating profit | 1,752 | 321 | 38 | (336) | - | 1,775 | |
Financial income | 1,279 | ||||||
Financial expenses | (187) | ||||||
Income/(loss) from equity affiliates | 4 | ||||||
| Profit before income taxes | 2,871 |
| Elimination | |||||||
| Note | Recorded | Music | Merchandising | Corporate | of | Total | |
| Music | Publishing | and other | centre | intersegment | |||
| (millions of euros) | transactions | ||||||
| Year ended December | |||||||
| 31, 2023 | |||||||
External revenue | 8,461 | 1,943 | 704 | - | - | 11,108 | |
Intercompany revenue | - | 13 | 2 | - | (15) | - | |
| Revenues | 8,461 | 1,956 | 706 | - | (15) | 11,108 | |
| Adjusted EBITDA | 2,042 | 470 | 47 | (190) | - | 2,369 | |
| Non-cash share-based | 24 | (424) | (50) | (4) | (83) | - | (561) |
| compensation expense | |||||||
| EBITDA | 1,618 | 420 | 43 | (273) | - | 1,808 | |
Amortisation and depreciation expense | (217) | (156) | (2) | (7) | - | (382) | |
Restructuring expenses | (34) | (2) | - | (5) | - | (41) | |
| Gain/(loss) on sale | 26 | - | - | - | - | 26 | |
| of assets | |||||||
| Impairment reversal/ | |||||||
(charge) on intangible assets | - | 7 | - | - | - | 7 | |
| Operating profit | 1,393 | 269 | 41 | (285) | - | 1,418 | |
Financial income | 454 | ||||||
Financial expenses | (151) | ||||||
Income/(loss) from equity affiliates | - | ||||||
| Profit before income taxes | 1,721 |
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Year ended December 31, | Year ended December 31, | |||
| (millions of euros) | 2024 | 2023 | ||
U.S. | 5,971 | 51% | 5,579 | 50% |
UK | 1,065 | 9% | 941 | 9% |
Japan | 761 | 6% | 768 | 7% |
Germany | 604 | 5% | 576 | 5% |
France | 459 | 4% | 444 | 4% |
Rest of the world 1 | 2,974 | 25% | 2,800 | 25% |
| Total revenues | 11,834 | 100% | 11,108 | 100% |
| Year ended December 31, | |||
| (millions of euros) | 2024 | 2023 | |
Streaming revenue | 1,414 | 1,425 | |
Subscription revenue | 4,623 | 4,275 | |
Downloads and other digital revenue | 180 | 207 | |
Physical revenue | 1,358 | 1,380 | |
License and other revenue | 1,326 | 1,174 | |
| Recorded Music revenue | 8,901 | 8,461 |
| Year ended December 31, | |||
| (millions of euros) | 2024 | 2023 | |
Performance revenue | 442 | 416 | |
Synchronisation revenue | 253 | 254 | |
Digital revenue | 1,268 | 1,128 | |
Mechanical revenue | 103 | 108 | |
Other revenue | 55 | 50 | |
| Music Publishing revenue | 2,121 | 1,956 |
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Segment assets
Segment assets by Segment
Segment assets that are reported to the executive board include items that are directly attributable
to a segment as well as those that can be allocated on a reasonable basis. Unallocated assets mainly
comprise of cash and deferred tax assets which are managed at the Group level.
| Note | Recorded | Music | Merchandising | Corporate | Total | |
| (millions of euros) | Music | Publishing | and other | centre | ||
| Year ended December 31, 2024 | ||||||
Goodwill | 9 | 1,003 | 788 | 104 | - | 1,895 |
Royalty advances, non- current | 10 | 1,138 | 730 | 217 | - | 2,085 |
Catalogues | 10 | 1,732 | 1,661 | - | - | 3,393 |
| Property, plant | 11 | 227 | 5 | - | 10 | 242 |
| & equipment | ||||||
Other intangible assets | 10 | 52 | 40 | - | 140 | 232 |
| Right of use relating | 12 | 442 | 4 | - | - | 446 |
| to leases | ||||||
| Royalty | 10 | 566 | 551 | 94 | - | 1,211 |
| advances, current | ||||||
Other assets | 5,112 | 821 | 132 | 543 | 6,608 | |
Total segment assets 1 | 10,272 | 4,600 | 547 | 693 | 16,112 | |
Unallocated assets | 1,208 | |||||
| Total assets | 17,320 |
1 Total segment assets in the Netherlands was €3,558 million in 2024 (€1,607 miillion in 2023).
| Note | Recorded | Music | Merchandising | Corporate | Total | |
| (millions of euros) | Music | Publishing | and other | centre | ||
| Year ended December 31, 2023 | ||||||
Goodwill | 9 | 779 | 745 | 100 | - | 1,624 |
Royalty advances, non- current | 10 | 862 | 508 | 204 | - | 1,574 |
Catalogues | 10 | 1,335 | 1,685 | - | - | 3,020 |
| Property, plant | 11 | 165 | 4 | - | 8 | 177 |
| & equipment | ||||||
Other intangible assets | 10 | 50 | 31 | - | 99 | 180 |
| Right of use relating | 12 | 310 | 4 | - | 2 | 316 |
| to leases | ||||||
| Royalty | 10 | 520 | 481 | 59 | - | 1,060 |
| advances, current | ||||||
Other assets | 3,171 | 753 | 54 | 234 | 4,212 | |
Total segment assets 1 | 7,192 | 4,211 | 417 | 343 | 12,163 | |
Unallocated assets | 928 | |||||
| Total assets | 13,091 |
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Content assets by segment
| December 31, 2024 | |||||
| Note | Recorded | Music | Merchandising | Total | |
| (millions of euros) | Music | Publishing | and other | ||
Catalogues (of music and publishing rights) | 1,732 | 1,661 | - | 3,393 | |
Royalty advances (to artists and repertoire owners) | 1,704 | 1,281 | 311 | 3,296 | |
| Of which: | |||||
| Non-current | 1,138 | 730 | 217 | 2,085 | |
| Current | 566 | 551 | 94 | 1,211 | |
| Content assets, net | 10 | 3,436 | 2,942 | 311 | 6,689 |
Current content assets | 566 | 551 | 94 | 1,211 | |
Non-current content assets | 2,870 | 2,391 | 217 | 5,478 |
| December 31, 2023 | |||||
| Note | Recorded | Music | Merchandising | Total | |
| (millions of euros) | Music | Publishing | and other | ||
Catalogues (of music and publishing rights) | 1,335 | 1,685 | - | 3,020 | |
Royalty advances (to artists and repertoire owners) | 1,382 | 989 | 263 | 2,634 | |
| Of which: | |||||
| Non-current | 862 | 508 | 204 | 1,574 | |
| Current | 520 | 481 | 59 | 1,060 | |
| Content assets, net | 10 | 2,717 | 2,674 | 263 | 5,654 |
Current content assets | 520 | 481 | 59 | 1,060 | |
Non-current content assets | 2,197 | 2,193 | 204 | 4,594 |
Note 4. Acquisitions and divestments
During 2024, UMG completed investments in Chord Music Partners (“Chord”), NTWRK, Mavin Global
(“Mavin”) and [PIAS]. Total cash used for these investments was €528 million. UMG accounts for its
investments in Chord and NTWRK as associates using the equity method, while the investments in
Mavin and [PIAS] were recognised as business combinations. The Chord and NTWRK transactions
closed in March 2024. The Mavin and [PIAS] acquisitions occurred in May 2024 and October
2024, respectively.
UMG did not have any material divestments in 2024 or 2023.
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
| Included in cost of revenues: | |||
Artist costs | 5,464 | 5,152 | |
Product costs | 1,282 | 1,056 | |
| Of which: | |||
Personnel costs | 33 | 33 | |
| Included in selling, general and administrative expenses: | |||
Depreciation of tangible assets | 11 | 34 | 34 |
Depreciation of right of use assets | 12 | 79 | 72 |
Personnel costs | 1,755 | 2,048 |
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| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
Salaries | 1,156 | 1,196 | |
Social security and other employment expenses | 196 | 209 | |
| Wages and expenses | 1,352 | 1,405 | |
Share-based compensation plans | 24 | 360 | 600 |
Employee defined contribution plans | 52 | 52 | |
Employee defined benefit plans | 23 | 1 | 2 |
Other | 23 | 22 | |
| Personnel costs | 1,788 | 2,081 | |
| Annual average number of full-time equivalent employees | 9.7 | 10.0 | |
| (in thousands) |
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
Interest income from cash, cash equivalents and other | 19 | 14 | |
Change in fair value of financial instruments through profit or loss | 19 | 1,170 | 431 |
Remeasurement on investment for step acquisition | 13 | 62 | - |
Expected return on plan assets related to employee benefit plans | 23 | 1 | 1 |
Gain on derivative instruments at fair value through profit or loss 1 | 24 | 5 | |
Income from investments | 3 | 3 | |
| Financial income | 1,279 | 454 | |
Interest expense on borrowings | (107) | (91) | |
Change in fair value of financial instruments through profit or loss | 19 | (17) | (14) |
Unwinding of interest component | (2) | (1) | |
Interest cost related to employee benefit plans | 23 | (6) | (7) |
Interest expenses on lease liabilities | 12 | (20) | (14) |
Foreign exchange loss | (3) | (11) | |
Loss on derivative instruments at fair value through profit or loss 1 | (19) | - | |
Cost of finance | (4) | (7) | |
Other | (9) | (6) | |
| Financial expenses | (187) | (151) | |
| Net total financial income and (expenses) | 1,092 | 303 |
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| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| (Expense)/income | ||
| Current tax | ||
Current year | (389) | (412) |
Under/(over) provided in prior years | (6) | 17 |
(395) | (395) | |
Withholding tax | (83) | (81) |
(478) | (476) | |
| Deferred tax | ||
Origination and reversal of temporary difference and tax attributes 1 | (310) | 16 |
De-recognition/(recognition) of deferred tax assets | 7 | 16 |
Effect of changes in tax rates | (3) | (3) |
Under/(over) provided in prior years | 6 | (11) |
(300) | 18 | |
| Total income tax expense in statement of profit and loss | (778) | (458) |
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| (Expense)/income | ||
| Current tax related to items recognized during the year: | ||
| To Equity | ||
Share based compensation | 1 | 11 |
1 | 11 | |
| Deferred tax related to items recognized during the year: | ||
| To Equity | ||
Share based compensation | 12 | 17 |
| To Other Comprehensive Income | ||
Net (gain)/loss on equity instruments designated at fair value through OCI | - | 3 |
Remeasurement (gain)/loss on actuarial gains and losses | 5 | 2 |
Foreign currency translation and (gain)/loss on hedge of net investments | (6) | 3 |
11 | 25 | |
| Total income tax charged to equity and other comprehensive income | 12 | 36 |
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| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| Net profit /(loss) from continuing operations | 2,093 | 1,263 |
Income taxes | 778 | 458 |
| Profit before income taxes | 2,871 | 1,721 |
Dutch statutory tax rate | 25.8% | 25.8% |
| Theoretical provision for income taxes based on Dutch statutory tax rate | (741) | (444) |
| Reconciliation of the theoretical and effective provision for income taxes | ||
Corporate tax rate differences | 8 | 7 |
Impacts of the changes in tax rates | (3) | (3) |
De-recognition/(recognition) of deferred tax assets | 7 | 16 |
Adjustments to tax expense from previous years | - | 6 |
Outside basis differences | (6) | - |
Non-deductible expenses | (15) | (19) |
Withholding taxes (net of Corporate Income tax benefit) | (64) | (58) |
| United States tax components | ||
Foreign Derived Intangible Income (FDII) deduction | 33 | 37 |
Other | 3 | - |
| Provision for income taxes | (778) | (458) |
| Effective tax rate | 27.1% | 26.6% |
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| Opening balance of current income tax receivables/(payables) | (34) | (49) |
Income tax expense in statement of profit and loss | (395) | (395) |
Income tax charged to equity and other comprehensive income | 1 | 11 |
Income tax paid/(received) | 349 | 393 |
Changes in foreign currency translation adjustments and other | 13 | 6 |
| Closing balance of current income tax receivables/(payables), net | (66) | (34) |
| Reflected in the statement of financial position as follows: | ||
Current tax receivables | 30 | 36 |
Current tax payables | (96) | (70) |
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| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| Opening balance of deferred tax assets/(liabilities) | (197) | (232) |
Income taxes | (300) | 18 |
Expenses and income directly recorded in equity and other comprehensive income | 11 | 25 |
Business combinations | (57) | - |
Changes in foreign currency translation adjustments and other | (2) | (8) |
| Closing balance of deferred tax assets/(liabilities), net | (545) | (197) |
Statement of financial position | Statement of profit or loss | |||
| (millions of euros) | 2024 | 2023 | 2024 | 2023 |
| Deferred tax | ||||
Tax attributes | 22 | 25 | 10 | (9) |
Non-deductible provisions | 100 | 85 | (23) | (37) |
Employee benefits | 114 | 120 | 25 | (59) |
Lease liabilities | 106 | 74 | (29) | 9 |
Asset revaluations | (188) | (172) | (20) | (19) |
Financial instruments 1 | (727) | (286) | 440 | 162 |
Right of use assets | (85) | (53) | 29 | (5) |
Working capital and other | 113 | 10 | (132) | (60) |
| Deferred tax expense/(benefit) | 300 | (18) | ||
| Net deferred tax assets/(liabilities) | (545) | (197) | ||
| Reflected in the statement of financial | ||||
| position as follows: | ||||
Deferred tax assets | 625 | 479 | ||
Deferred tax liabilities | (1,170) | (676) |
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Note 8.
Earnings per share
| Year ended December 31, | ||
| (millions of euros and shares, except per share data) | 2024 | 2023 |
| Net profit attributable to equity holders of the parent | 2,086 | 1,259 |
| Weighted average number of shares outstanding (after deduction of treasury shares) | 1,827 | 1,819 |
| during the year | ||
Potential dilutive effects related to share-based compensation | 25 | 23 |
| Diluted weighted average number of shares | 1,852 | 1,842 |
Earnings per share (in euros) | ||
Basic earnings per share | 1.14 | 0.69 |
Diluted earnings per share | 1.13 | 0.68 |
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| (millions of euros) | 2024 | 2023 |
| Balance as at January 1 | ||
Goodwill, gross | 1,720 | 1,678 |
Accumulated impairment losses | (96) | (100) |
| Goodwill, net | 1,624 | 1,578 |
| Changes in book value: | ||
Acquisitions | 180 | 93 |
Foreign currency translation adjustments | 91 | (47) |
| Total changes | 271 | 46 |
| Balance as at December 31 | ||
Goodwill, gross | 1,997 | 1,720 |
Accumulated impairment losses | (102) | (96) |
| Goodwill, net | 1,895 | 1,624 |
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
Recorded Music | 1,003 | 779 |
Music Publishing | 788 | 745 |
Merchandising & Other | 104 | 100 |
| Closing balance | 1,895 | 1,624 |
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2024 | 2023 | |||||
| Compound | Extrapolation | Compound | Extrapolation | |||
| Annual | r evenue | Pre-tax | Annual | r evenue | Pre-tax | |
| In % per year | R evenue | growth rate | discoun t | R evenue | growth rate | discoun t |
| Growth | after 2028 | rates | Growth | after 2027 | rates | |
| 2024-2028 | 2023-2027 | |||||
Recorded Music | 7.0% | 3.3% | 10.2% | 6.6% | 3.3% | 10.0% |
Music Publishing | 7.0% | 3.3% | 10.2% | 5.9% | 3.3% | 10.0% |
Merchandising | 13.4% | 2.1% | 10.2% | 9.1% | 2.1% | 10.0% |
| December 31, 2024 | |||
| Accumulated | |||
| Asset value, | amor tisation and | Net book value | |
gr oss | impairment | ||
| (millions of euros) | losses | ||
Catalogues (of music and publishing rights) | 6,623 | (3,230) | 3,393 |
Royalty advances (to artists and repertoire owners) | 3,296 | - | 3,296 |
| Content assets | 9,919 | (3,230) | 6,689 |
Other intangible assets | 684 | (452) | 232 |
| December 31, 2023 | |||
| Accumulated | |||
| Asset value, gross | amor tisation | Net book value | |
| and impairment | |||
| (millions of euros) | losses | ||
Catalogues (of music and publishing rights) | 5,845 | (2,825) | 3,020 |
Royalty advances (to artists and repertoire owners) | 2,634 | - | 2,634 |
| Content assets | 8,479 | (2,825) | 5,654 |
Other intangible assets | 585 | (405) | 180 |
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| Catalogues (of | Royalty advances | Total intangible | ||
| music and | (to artists and | Other | assets & | |
| publishing | repertoire | intangibles | advances | |
| (millions of euros) | rights) | owners) | ||
| Balance December 31, 2022 | 3,058 | 2,577 | 119 | 5,754 |
Amortisation | (236) | - | (40) | (276) |
Impairment | 7 | - | - | 7 |
Additions | 264 | 1,319 | 103 | 1,686 |
Disposals | (1) | - | - | (1) |
Recoupments | - | (1,201) | - | (1,201) |
Business combinations | 19 | - | - | 19 |
| Changes in foreign currency translation | (91) | (61) | (2) | (154) |
adjustments and other Balance December 31, 2023 | 3,020 | 2,634 | 180 | 5,834 |
Amortisation | (245) | - | (51) | (296) |
Impairment | (2) | - | - | (2) |
Additions | 217 | 1,965 | 92 | 2,274 |
Disposals | (4) | - | (1) | (5) |
Recoupments | - | (1,445) | - | (1,445) |
Business combinations | 245 | 36 | 2 | 283 |
| Changes in foreign currency translation | 162 | 106 | 10 | 278 |
adjustments and other Balance December 31, 2024 | 3,393 | 3,296 | 232 | 6,921 |
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Note 11. Property, plant and equipment
| Land and | Equipment | Other fixed | Assets under | ||
| buildings | and | assets | construction | Total | |
| (millions of euros) | machinery | ||||
| Cost | |||||
| Balance as at January 1, 2024 | 242 | 122 | 74 | 24 | 462 |
Additions | 32 | 2 | 3 | 54 | 91 |
Transfers and reclassifications | 20 | 7 | 7 | (34) | - |
Disposals | (31) | (8) | (9) | - | (48) |
| Changes in foreign currency | 9 | 2 | 2 | 1 | 14 |
translation adjustments and other Balance as at December 31, 2024 | 272 | 125 | 77 | 45 | 519 |
| Depreciation and impairment losses | |||||
| Balance as at January 1, 2024 | (136) | (92) | (57) | - | (285) |
Depreciation during the year | (18) | (10) | (6) | - | (34) |
Disposals | 31 | 10 | 8 | - | 49 |
| Changes in foreign currency | (3) | (2) | (2) | - | (7) |
translation adjustments and other Balance as at December 31, 2024 | (126) | (94) | (57) | - | (277) |
| Carrying amount | |||||
As at January 1 | 106 | 30 | 17 | 24 | 177 |
As at December 31 | 146 | 31 | 20 | 45 | 242 |
| Land and | Equipment | Other fixed | Assets under | ||
| buildings | and | assets | construction | Total | |
| (millions of euros) | machinery | ||||
| Cost | |||||
| Balance as at January 1, 2023 | 241 | 119 | 78 | 20 | 458 |
Additions | 3 | 3 | 3 | 38 | 47 |
Transfers and reclassifications | 17 | 16 | 1 | (34) | - |
Disposals | (16) | (15) | (6) | - | (37) |
| Changes in foreign currency | (3) | (1) | (2) | - | (6) |
translation adjustments and other Balance as at December 31, 2023 | 242 | 122 | 74 | 24 | 462 |
| Depreciation and impairment losses | |||||
| Balance as at January 1, 2023 | (135) | (99) | (57) | - | (291) |
Depreciation during the year | (18) | (9) | (7) | - | (34) |
Disposals | 15 | 15 | 6 | - | 36 |
| Changes in foreign currency | 2 | 1 | 1 | - | 4 |
translation adjustments and other Balance as at December 31, 2023 | (136) | (92) | (57) | - | (285) |
| Carrying amount | |||||
As at January 1 | 106 | 20 | 21 | 20 | 167 |
As at December 31 | 106 | 30 | 17 | 24 | 177 |
MUSIC IS UNIVERSAL Annual Report 2024 | 213
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Note 12. Leases
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| Opening balance | 316 | 318 |
Depreciation | (79) | (72) |
Additions | 220 | 78 |
Disposals | (24) | (1) |
Foreign currency translations and other | 13 | (7) |
| Closing balance | 446 | 316 |
Lease liabilities
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
| Opening balance | 410 | 423 | |
Additions | 219 | 77 | |
Disposals | (24) | (1) | |
Accretion of interest | 6 | 20 | 14 |
Payments | (102) | (94) | |
Of which interest | (21) | (14) | |
Of which principal | (81) | (80) | |
Foreign currency translations and other | 18 | (9) | |
| Closing balance | 541 | 410 |
Maturity of lease liabilities
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| Maturity | ||
< 1 year | 66 | 86 |
Between 1 and 5 years | 252 | 217 |
> 5 years | 223 | 107 |
| Lease liabilities | 541 | 410 |
Cash outflow for leases and lease-related expenses
Total cash outflow and expenses for the leases of real-estate with maturity shorter than 12 months
and expense relating to low-value assets recorded in the Statement of Profit or Loss amounted
to €19 million for the year ended December 31, 2024 (compared to €19 million for the year ended
December 31, 2023).
MUSIC IS UNIVERSAL
Annual Report 2024 | 214
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| Opening balance | 222 | 156 |
Acquisitions 1 | 395 | 74 |
Business combinations 2 | (56) | - |
Income/(loss) from equity affiliates | 4 | - |
Change in other comprehensive income | 25 | (4) |
Dividends | (12) | (4) |
Translation difference | - | - |
| Closing balance | 578 | 222 |
MUSIC IS UNIVERSAL Annual Report 2024 | 215
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
| Operating profit | 1,775 | 1,418 |
Amortisation and depreciation expense | 409 | 382 |
Non-cash share-based compensation expense, net of employees tax withheld | 131 | 429 |
Impairment (reversal)/charge on intangible assets | 2 | (7) |
Changes in provision, net | 1 | 18 |
(Gain)/loss on sale of assets | (23) | (26) |
| Adjustments | 520 | 796 |
Royalty advance payments, net of recoupments | (186) | (100) |
Other changes in net working capital | (5) | 164 |
| Net cash provided by/(used for) operating activities before income tax paid | 2,104 | 2,278 |
Income tax paid | (349) | (393) |
| Net cash provided by/(used for) operating activities | 1,755 | 1,885 |
| Net cash provided by/(used for) investing activities | (1,051) | (622) |
Repayment of lease liabilities and related interest expenses | (102) | (94) |
Interest, net | (81) | (77) |
Other cash items related to financing activities | 2 | (10) |
| Free cash flow | 523 | 1,082 |
| Changes | Changes | |||||
| December | in operating | Business | in foreign | December | ||
| 31, 2023 | working | combinations | currency | Other 2 | 31, 2024 | |
capital 1 | translation | |||||
| (millions of euros) | adjustments | |||||
Inventories 3 | 210 | 32 | 5 | 8 | - | 255 |
| Trade accounts | 2,246 | 110 | 40 | 51 | 50 | 2,497 |
receivable and other Of which: | ||||||
| Trade | 646 | 107 | 35 | 18 | 7 | 813 |
| accounts receivable | ||||||
Expected credit losses | (49) | 4 | - | - | 3 | (42) |
| Working capital assets | 2,456 | 142 | 45 | 59 | 50 | 2,752 |
| Trade accounts payable | (5,711) | (137) | (75) | (214) | (257) | (6,394) |
and other Other non- current liabilities | (715) | - | (30) | (23) | (688) | (1,456) |
| Working capital liabilities | (6,426) | (137) | (105) | (237) | (945) | (7,850) |
| Net working capital | (3,970) | 5 | (60) | (178) | (895) | (5,098) |
MUSIC IS UNIVERSAL Annual Report 2024 | 216
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Changes | Changes | |||||
| December | in operating | Business | in foreign | December | ||
| 31, 2022 | working | combinations | currency | Other 2 | 31, 2023 | |
capital 1 | translation | |||||
| (millions of euros) | adjustments | |||||
Inventories 3 | 163 | 52 | - | (5) | - | 210 |
| Trade accounts | 2,014 | 309 | 3 | (41) | (39) | 2,246 |
receivable and other Of which: | ||||||
| Trade | 580 | 102 | 3 | (16) | (23) | 646 |
| accounts receivable | ||||||
Expected credit losses | (62) | 13 | (1) | 2 | (1) | (49) |
| Working capital assets | 2,177 | 361 | 3 | (46) | (39) | 2,456 |
| Trade accounts payable | (5,150) | (527) | (9) | 134 | (159) | (5,711) |
and other Other non- current liabilities | (437) | 2 | (40) | 5 | (245) | (715) |
| Working capital liabilities | (5,587) | (525) | (49) | 139 | (404) | (6,426) |
| Net working capital | (3,410) | (164) | (46) | 93 | (443) | (3,970) |
MUSIC IS UNIVERSAL
Annual Report 2024 | 217
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
MUSIC IS UNIVERSAL
Annual Report 2024 | 218
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| (millions of euros) | USD | GBP | JPY | Other | Total |
| Nominal value of Balance sheet exposure | 91 | 623 | 133 | 385 | 1,232 |
Foreign exchange rate derivatives | (91) | (623) | (133) | (385) | (1,232) |
| Net exposure | - | - | - | - | - |
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
Trade receivables | 2,244 | 1,986 |
Other receivables | 253 | 260 |
| Trade receivables, net of value allowance | 2,497 | 2,246 |
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
Current | 2,160 | 1,895 |
Overdue 0-30 days | 44 | 58 |
Overdue 31-150 days | 25 | 25 |
Overdue >150 days | 15 | 8 |
| Trade receivables, net of value allowance | 2,244 | 1,986 |
MUSIC IS UNIVERSAL
Annual Report 2024 | 219
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
Trade accounts payable | 168 | 118 |
Music royalties to artists and repertoire owners | 4,327 | 3,944 |
Accrued expenses | 424 | 389 |
Creative talent and content liabilities | 533 | 362 |
Other payables | 530 | 490 |
| Trade and other accounts payable | 5,982 | 5,303 |
Current contract liabilities | 412 | 408 |
| Trade accounts payable and other | 6,394 | 5,711 |
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
Cash and cash equivalents | 553 | 413 |
Bank overdrafts | (8) | (26) |
| Cash and cash equivalents in the statement of cash flows | 545 | 387 |
December 31, 2024 | December 31, 2023 | |||||
| (millions of euros) | Total | Long-term | Short-term | Total | Long-term | Short-term |
Bonds | 1,810 | 1,776 | 34 | 1,808 | 1,774 | 34 |
| Drawn revolving | - | - | - | - | - | - |
| credit facilities | ||||||
Commercial papers | 746 | - | 746 | 197 | - | 197 |
Bank overdrafts | 8 | - | 8 | 26 | - | 26 |
Other | 87 | 2 | 85 | 73 | 52 | 21 |
Borrowings at amortized cost | 2,651 | 1,778 | 873 | 2,104 | 1,826 | 278 |
Cash and cash equivalents | (553) | - | (553) | (413) | - | (413) |
| Derivative | - | - | - | (2) | - | (2) |
| financial assets | ||||||
| Net debt | 2,098 | 1,689 |
MUSIC IS UNIVERSAL Annual Report 2024 | 220
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Drawn | ||||||
| revolving | Bonds | Bank | Commercial | Other debt | Total | |
| credit | overdrafts | papers | ||||
| (millions of euros) | facilities | |||||
| Balance December | 125 | 1,004 | 1 | 929 | 191 | 2,250 |
| 31, 2022 | ||||||
New borrowings | 1,075 | 794 | 26 | 4,738 | 34 | 6,667 |
Repayments | (1,200) | - | (1) | (5,469) | (145) | (6,815) |
| Translation differences | - | 10 | - | (1) | (7) | 2 |
| and other movements | ||||||
| Balance December | - | 1,808 | 26 | 197 | 73 | 2,104 |
| 31, 2023 | ||||||
New borrowings | 300 | - | 8 | 3,897 | 124 | 4,329 |
Repayments | (300) | - | (26) | (3,351) | (104) | (3,781) |
| Translation differences | - | 2 | - | 3 | (6) | (1) |
| and other movements | ||||||
| Balance December | - | 1,810 | 8 | 746 | 87 | 2,651 |
| 31, 2024 |
MUSIC IS UNIVERSAL Annual Report 2024 | 221
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Minimum future payments as of December 31, 2024 | Total minimum | ||||
| future payments | |||||
| Payments due in | as of | ||||
| (millions of euros) | Total | 1 year | 2-5 years | After 5 years | December 31, 2023 |
Borrowings and other financial liabilities | 3,086 | 868 | 778 | 1,440 | 2,449 |
Lease liabilities | 664 | 89 | 309 | 266 | 463 |
Music royalties to artists and repertoire owners | 4,343 | 4,327 | 16 | - | 3,957 |
Creative talent and content liabilities | 944 | 533 | 411 | - | 603 |
Other payables | 2,094 | 1,065 | 57 | 972 | 1,411 |
Consolidated statement of financial position items | 11,131 | 6,882 | 1,571 | 2,678 | 8,883 |
| Contractual | 1,707 | 843 | 780 | 84 | 1,595 |
| content commitments | |||||
Other commitments 1 | 875 | 778 | 96 | 1 | 287 |
| Total off-balance | 2,582 | 1,621 | 876 | 85 | 1,882 |
| sheet commitments | |||||
| Total | 13,713 | 8,503 | 2,447 | 2,763 | 10,765 |
MUSIC IS UNIVERSAL Annual Report 2024 | 222
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| December 31, 2024 | |||||
| Fair value | |||||
| Carrying | Level 1 | Level 2 | Level 3 | ||
| (millions of euros) | amount | ||||
| Financial assets at fair value through profit and loss | |||||
Listed equity securities | 2,945 | 2,945 | - | - | |
Other financial assets | 112 | - | 7 | 105 | |
Trade and other receivables | - | - | - | - | |
Financial assets at fair value through other comprehensive income | |||||
Unlisted equity securities | 18 | - | - | 18 | |
| Financial assets at amortised cost | |||||
Trade and other receivables | 2,497 | - | - | - | |
Other financial assets | 197 | - | - | - | |
| Total financial assets | 5,769 | 2,945 | 7 | 123 | |
| Financial liabilities at fair value through profit and loss | |||||
Trade and other payables | (3) | (3) | - | - | |
Other non-current liabilities | (63) | (8) | - | (55) | |
| Financial liabilities at amortised cost | |||||
Trade and other payables | (6,391) | - | - | - | |
Bonds | (1,810) | (1,791) | - | - | |
Borrowings, excluding bank overdrafts and bonds | (833) | - | - | - | |
Other non-current liabilities | (1,393) | - | - | - | |
| Total financial liabilities | (10,493) | (1,802) | - | (55) |
MUSIC IS UNIVERSAL Annual Report 2024 | 223
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| December 31, 2023 | ||||
| Fair value | ||||
| Carrying | Level 1 | Level 2 | Level 3 | |
| (millions of euros) | amount | |||
| Financial assets at fair value through profit and loss | ||||
Listed equity securities | 1,227 | 1,227 | - | - |
Other financial assets | 75 | - | 55 | 20 |
Trade and other receivables | - | - | - | - |
Financial assets at fair value through other comprehensive income | ||||
Unlisted equity securities | 20 | - | - | 20 |
| Financial assets at amortised cost | ||||
Trade and other receivables | 2,246 | - | - | - |
Other financial assets | 205 | - | - | - |
| Total financial assets | 3,773 | 1,227 | 55 | 40 |
| Financial liabilities at fair value through profit and loss | ||||
Trade and other payables | (4) | (4) | - | - |
Other non-current liabilities | (35) | (5) | - | (30) |
| Financial liabilities at amortised cost | ||||
Trade and other payables | (5,707) | - | - | - |
Bonds | (1,808) | (1,808) | - | - |
Borrowings, excluding bank overdrafts and bonds | (270) | - | - | - |
Other non-current liabilities | (680) | - | - | - |
| Total financial liabilities | (8,504) | (1,817) | - | (30) |
| Change | Cumulative | ||||||||
| Number | Ownership | Average | Stock | Carrying | in value | unrealized | Sensitivity | ||
| of shares | interest | purchase | market | value | over the | captial | at +/- 10 | ||
| held | price 1,2 | price | period | gain/ | pts | ||||
(loss) 3 | |||||||||
(thousands) (€/share) | (millions of euros) | ||||||||
Spotify | 6,487 | 3.27% | 6.58 | 171.36 | 1,112 | 629 | 1,069 | +111/-111 | |
| Tencent | 12,246 | 0.78% | na | 8.22 | 101 | 5 | 101 | +10/-10 | |
| Music Entertainment | |||||||||
Other | 14 | (4) | 14 | ||||||
| Total at December | 1,227 | 630 | 1,184 | ||||||
| 31, 2023 | |||||||||
Spotify | 6,487 | 3.16% | 6.58 | 431.90 | 2,802 | 1,690 | 2,759 | +280/-280 | |
| Tencent | 12,246 | 0.79% | na | 10.96 | 134 | 33 | 134 | +13/-13 | |
| Music Entertainment | |||||||||
Other | 9 | (5) | 9 | ||||||
| Total at December | 2,945 | 1,718 | 2,902 | ||||||
| 31, 2024 | |||||||||
MUSIC IS UNIVERSAL Annual Report 2024 | 224
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Retained Earnings
Dividend Distribution
On May 16, 2024 the shareholders approved a dividend distribution of €0.27 per ordinary share,
corresponding to a total distribution of €494 million, paid in June 2024.
On July 23, 2024 the directors approved an interim dividend distribution of €0.24 per ordinary share,
corresponding to a total distribution of €439 million paid in October 2024.
UMG plans to annually declare and pay dividends to all holders of the Shares on a pro-rata basis
in two semi-annual instalments, in the aggregate amount of no less than 50% of UMG's net profits
realized during the relevant financial year, subject to agreed non-cash items. UMG intends to pay an
interim dividend in the fourth quarter of each financial year, after the publication of the half-year
figures of the Group, and a final dividend in the second quarter of the following financial year, to be
paid following approval of the UMG's financial statements at its Annual General Meeting.
A proposal will be submitted to the 2025 Annual General Meeting of Shareholders to pay a final
dividend of €0.28 per ordinary share corresponding to a distribution of €512 million, in cash, from
the 2024 retained earnings, payable in Q2 2025. This would bring the total dividend for 2024 to
€951 million, or €0.52 per ordinary share.
Note 21. Expenses and income directly recognized in other comprehensive income
Details of changes in equity related to other comprehensive income
| Items not subsequently | reclassified to profit & loss | Items to be subsequently reclassified to | profit & loss | ||||
| Actuarial | Financial | Other | |||||
| gains/ | assets at | Foreign | Net gain/ | comprehensive | |||
| (losses) | fair value | currency | (losses) on | income from | Other | ||
| related to | through | translation | hedge of net | equity | comprehensive | ||
| employee | other | adjustments | investment | affiliates, | income | ||
| defined | comprenhensive | net | |||||
| (millions of euros) | benefit plans | income | |||||
| Balance as of December | (11) | (5) | (16) | 3 | - | (29) | |
| 31, 2022 | |||||||
Expenses and income directly | (5) | (1) | (153) | (4) | 5 | (158) | |
recognized in other comprehensive income | |||||||
Tax effect | 2 | - | 3 | 3 | - | 8 | |
| Balance as of December | (14) | (6) | (166) | 8 | (1) | (179) | |
| 31, 2023 | |||||||
Expenses and income directly | (17) | (4) | 261 | 3 | 25 | 268 | |
recognized in other comprehensive income | |||||||
Tax effect | 5 | - | (6) | - | - | (1) | |
| Balance as of December | (26) | (10) | 89 | 11 | 24 | 88 | |
| 31, 2024 |
MUSIC IS UNIVERSAL Annual Report 2024 | 225
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Year ended December 31, | |||
(millions of euros) | Note | 2024 | 2023 |
Post-retirement employee benefits | 23 | 178 | 166 |
Royalty audit claims | 118 | 129 | |
Deferred employee compensation | 31 | 31 | |
Restructuring costs | 53 | 19 | |
Litigations | 19 | 21 | |
Other | 62 | 56 | |
| Provisions | 461 | 422 | |
Deduction of current provisions | (195) | (122) | |
| Non-current provisions | 266 | 300 |
Restructuring | Litigation | Royalty audit | Other | Total | |
| (millions of euros) | claims | ||||
| Balance as at January 1, 2024 | 19 | 21 | 129 | 56 | 225 |
Additions | 108 | 1 | 54 | - | 163 |
Utilizations | (74) | (2) | (36) | (4) | (116) |
Releases | (1) | - | (32) | (6) | (39) |
| Changes in foreign currency translation | 1 | (1) | 3 | 16 | 19 |
adjustments and other Balance as at December 31, 2024 | 53 | 19 | 118 | 62 | 252 |
Current | 50 | 16 | 70 | 35 | 171 |
Non-current | 3 | 3 | 48 | 27 | 81 |
2024 | 2023 | |||||
| Fair value | Net | Fair value | Net | |||
| Obligation | of plan | obligation/ | Obligation | of plan | obligation/ | |
| (millions of euros) | assets | (asset) | assets | (asset) | ||
Germany | 147 | (1) | 146 | 136 | (1) | 135 |
U.S. | 19 | - | 19 | 18 | - | 18 |
Other | 38 | (36) | 2 | 38 | (35) | 3 |
| Total | 204 | (37) | 167 | 192 | (36) | 156 |
of which assets related to employee benefit plans | (11) | (10) | ||||
| liabilities for employee | ||||||
benefit plans | 178 | 166 |
MUSIC IS UNIVERSAL Annual Report 2024 | 226
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| 2024 | ||||
| Fair value | Net | |||
| Note | Obligation | of plan | obligation/ | |
| (millions of euros) | assets | (asset) | ||
| Opening balance | 192 | (36) | 156 | |
Current service cost | 5 | 1 | - | 1 |
(Gain)/loss on settlements | - | - | - | |
Other | - | - | - | |
| Impact on selling & administrative expenses | 1 | - | 1 | |
Interest cost | 6 | 6 | - | 6 |
Expected return on plan assets | 6 | - | (1) | (1) |
| Impact on other financial income | 6 | (1) | 5 | |
| Included in the statement of profit or loss | 7 | (1) | 6 | |
| Actuarial losses/(gains) related to: | ||||
Experience adjustments | 14 | (3) | 11 | |
Financial assumptions | 6 | - | 6 | |
Demographic assumptions | - | - | - | |
| Included in other comprehensive income | 21 | 20 | (3) | 17 |
Contributions by employers | - | (13) | (13) | |
Benefits paid by the fund | (3) | 3 | - | |
Benefits paid by the employer | (12) | 12 | - | |
Foreign currency and other | - | 1 | 1 | |
| Closing balance | 204 | (37) | 167 | |
of which wholly or partly funded benefits | 33 | |||
wholly unfunded benefits 1 | 171 | |||
| assets related to employee benefit plans | (11) | |||
| liabilities for employee benefit plans | 178 |
MUSIC IS UNIVERSAL Annual Report 2024 | 227
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| 2023 | ||||
| Fair value | Net | |||
| Note | Obligation | of plan | obligation/ | |
| (millions of euros) | assets | (asset) | ||
| Opening balance | 194 | (41) | 153 | |
Current service cost | 5 | 2 | - | 2 |
(Gain)/loss on settlements | - | - | - | |
Other | - | - | - | |
| Impact on selling & administrative expenses | 2 | - | 2 | |
Interest cost | 6 | 7 | - | 7 |
Expected return on plan assets | 6 | - | (1) | (1) |
| Impact on other financial income | 7 | (1) | 6 | |
| Included in the statement of profit or loss | 9 | (1) | 8 | |
| Actuarial losses/(gains) related to: | ||||
Experience adjustments | (3) | - | (3) | |
Financial assumptions | 9 | - | 9 | |
Demographic assumptions | (1) | - | (1) | |
| Included in other comprehensive income | 21 | 5 | - | 5 |
Contributions by employers | - | (12) | (12) | |
Benefits paid by the fund | (2) | 2 | - | |
Benefits paid by the employer | (12) | 12 | - | |
Foreign currency and other | (2) | 4 | 2 | |
| Closing balance | 192 | (36) | 156 | |
of which wholly or partly funded benefits | 33 | |||
wholly unfunded benefits 1 | 159 | |||
| assets related to employee benefit plans | (10) | |||
| liabilities for employee benefit plans | 166 |
Germany | U.S. | Weighted average of | ||||
| all plans | ||||||
2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |
Discount rate | 3.30% | 3.50% | 5.47% | 5.28% | 3.33% | 3.51% |
Inflation rate | 2.00% | 2.00% | na | na | 2.00% | 2.00% |
Rate of compensation increase | 2.00% | 2.50% | na | na | 1.96% | 2.39% |
| Duration of the benefit | 9.9 | 9.6 | ||||
| obligation (in years) | ||||||
| na: not applicable. |
MUSIC IS UNIVERSAL
Annual Report 2024 | 228
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Year ended December 31, | ||
| (millions of euros) | 2024 | 2023 |
Insurance contracts | 55% | 54% |
Equity securities | 22% | 21% |
Debt securities | 14% | 15% |
Diversified funds | 0% | 0% |
Cash and other | 9% | 10% |
| Total | 100% | 100% |
Note 24. Share-based compensation plans
In 2022, UMG received formal approval from its shareholders to implement an equity plan, the UMG
Global Equity Plan. Under the plan, Restricted Stock Units (RSUs) and Performance Stock Units (PSUs)
are granted to senior executives to align the interests of the employees of UMG with its shareholders’
interests by providing them with an additional incentive to improve UMG's performance and
increase its share price on a long-term basis. In addition, the Annual Incentive Plan (AIP) for these
senior executives was modified such that all or a portion of the payment under the plan may be
settled in equity at the discretion of UMG. In 2023 and continuing in 2024, the equity plan was
extended to additional executives, certain non-executive board directors and a number of senior
management personnel, resulting in the issuance of additional RSUs, PSUs and also Performance
Stock Options (PSOs).
UMG Restricted Stock Units (RSUs)
Starting in the last quarter of 2022, and continuing for each year of service under the term of their
contracts, certain senior executives and senior management are granted RSUs, being a right to
receive shares upon vesting. The awards have vesting periods of 2.5 to 8 years and will vest in 3
equal instalments if the service condition is fulfilled. The grant date weighted-average UMG share
market price of the RSUs was €22.21 (2023: €21.50) per share corresponding to the total fair value of
€343 million (2023: €367 million) of such awards.
In addition, a one-off RSU award was granted to certain senior executives and senior management
with an average 15 months vesting period in 2 equal instalments. The grant date weighted-average
UMG share market price of the one-off RSUs was €23.04 (2023: €21.18) per share corresponding to the
total fair value of €8 million (2023: €205 million) of such awards.
The RSUs granted to certain non-executive board directors have vesting periods of 1 to 2 years. The
grant date weighted-average UMG share market price was €28.16 per share corresponding to the total
fair value of €2 million of such awards.
There was a number of RSUs granted with slightly different service conditions. The grant date
weighted-average UMG share market price was €22.65 (2023: €22.67) per share corresponding to the
total fair value of €41 million (2023: €51 million) of such awards.
The share rights are dividend-bearing during the service period. The total expense for these awards
recognised in 2024 was €185 million (2023: €469 million) and the total equity reserve at December 31,
2024 was €203 million (2023: €308 million).
UMG Performance Stock Units (PSUs)
Starting in the last quarter of 2022, and continuing for each year of service under the term of
their contracts, certain senior executives and senior management are granted PSUs, being a right
to receive shares upon vesting. The vesting of these rights is subject to service, market and non-
market performance conditions.
For these PSUs, the total number of shares delivered will range from 0% to 200% of the number of
PSUs granted based on certain performance conditions tailored to each participant. These include
non-market performance conditions: target compound annual growth rate for revenues (Revenue
CAGR) and Adjusted EBITDA (Adjusted EBITDA CAGR) and a market performance condition: relative
total shareholder return (TSR). In addition, the employee must remain in continued service for a
three-year period. The share rights are dividend-bearing during the performance period.
The estimated grant date weighted-average UMG share market price of the PSUs was €24.92
(2023: €25.45) per share corresponding to the total fair value of €168 million (2023: €130 million)
MUSIC IS UNIVERSAL
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
of such awards. The grant date fair value was estimated taking into account the market
performance condition.
There was a small number of PSU awards with slightly different service and performance conditions.
The estimated grant date UMG share market price of €25.81 (2023: €25.81) per share corresponding to
the total fair value of €18 million (2023: €18 million) of such awards.
The total expense for these awards recognised in 2024 was €96 million (2023: €47 million) and the
total equity reserve at December 31, 2024 was €141 million (2024: €52 million).
Annual Incentive Program (AIP)
In 2022, the AIP for senior executives, which was previously settled only in cash and accrued
throughout the year, was modified to allow UMG the choice of whether to settle in cash, shares,
or a combination of the two. Such modification did not change the fair value of the award compared
to the previously accrued AIP payable. UMG expects to settle 50% of the AIP in cash and 50% in
shares. UMG has a constructive obligation to settle 50% of the award in cash. The total AIP expense
for the full calendar year starting January 1, 2024, being the start of the service period for the 2024
award, was €61 million (2023: €47 million) with the cash-settled AIP accrual amounting to 50% of the
total expense.
The vesting conditions of the AIP awards are a one-year service period and certain internally
measured performance conditions including Adjusted EBITDA, revenue and cash flow from
operations (CFFO). The amount received can vary between 0% and 200% of the on-target amount
based on the actual performance against these performance criteria.
The number of shares granted is based on the total value of the award and UMG’s share price
on 15 March. The total fair value of the equity-settled portion of the total AIP is €31 million (2023:
€25 million).
UMG Performance Stock Options (PSOs)
In 2023, PSOs were granted to a senior executive. The PSOs are subject to a service condition and
a market condition. Under the service condition, the options will vest annually in four substantially
equal instalments on each of the first four anniversaries of the grant date, subject to the senior
executive’s continued employment by UMG on those dates. The market condition requires that
certain stock price hurdles be met before the PSOs become exercisable. The stock price hurdles
are met as follows: one-third of the PSOs each becomes exercisable at hurdle prices of €26.50, €30.00
and €38.00, respectively, based on the preceding 30-day average closing price of UMG N.V. shares.
The PSOs were granted on March 30, 2023 at a total fair value of €45.9 million ($50 million), the grant
date fair value used for recognising the expense on these awards. In accordance with the PSO terms,
the number of options issued was determined at a later valuation date, April 30, 2023.
During the first half of 2024, PSOs were granted to another senior executive. The PSOs are subject to a
service condition and a market condition. The terms of the service conditions and market condition
are the same as the previously granted PSOs with the exception of the stock price hurdles. The stock
price hurdles are met as follows: one-third of the PSOs each becomes exercisable at hurdle prices of
€30.00, €34.00 and €38.00, respectively, based on the preceding 30-day average closing price of UMG
N.V. shares. The PSOs were granted on May 30, 2024 at a total fair value of €4.6 million ($5 million), the
grant date fair value used for recognising the expense on these awards. In accordance with the PSO
terms, the number of options issued was determined at a later valuation date, May 31, 2024.
Both senior executives must be employed by UMG on the occurrence of the stock price hurdles. As a
result, the PSOs vest at the later of completion of service condition or the stock price hurdle. Awards
will forfeit if the relevant stock price hurdle is not met in the five-year period following the grant date.
The PSOs will be equity-settled.
As of each respective valuation date, a Monte Carlo simulation was performed to determine the
number of options to be issued so that the per unit fair values summed in total to the grant
date fair value. The valuation exercise simulated the stock price of UMG over the contractual term,
taking into account the terms and conditions on which the options were granted, expected dividend
distributions and the historical volatility of UMG. UMG’s historical volatility was also benchmarked
against the long-term volatility of other listed groups considered comparable to UMG.
The number and weighted average exercise price (WAEP) of, and movements in, share options were
as follows:
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2024 | 2023 | |||
| Number | WAEP | Number | WAEP | |
| (thousands) | (thousands) | |||
| Outstanding at 1 January | 8,625 | € 19.81 | - | na |
Granted during the year | 610 | € 28.58 | 8,625 | € 19.81 |
Forfeited during the year | - | na | - | na |
Exercised during the year | - | na | - | na |
Expired during the year | - | na | - | na |
| Outstanding at 31 December | 9,235 | € 20.61 | 8,625 | € 19.81 |
Exercisable at 31 December | 719 | € 19.81 | - | na |
The weighted average remaining contractual life for the share options outstanding as at December
31, 2024 was 3.34 years (2023: 4.34 years).
The weighted average fair value of options granted during the year was €7.6 (2023: €5.3).
The range of exercise prices for options outstanding at the end of the year was €19.81 to €28.58
(2023: €19.81).
The following table lists additional weighted average inputs to the Monte Carlo model used for the
PSOs for the awards granted during the period:
| 2024 | 2023 | |
Dividend yield (%) | 2.00 | 2.00 |
Expected volatility (%) | 30.70 | 34.60 |
Risk free interest rate (%) | 2.93 | 2.64 |
Weighted average share price at valuation date (€) | 28.58 | 19.81 |
The dividend distribution during the lifetime of the option has been estimated based on historical
and forecasted data and is not necessarily indicative of yield patterns that may occur. The expected
volatility reflects the assumption that the historical volatility over a period similar to the life of the
options is indicative of future trends, which also may not necessarily be the actual outcome.
The total expense for these awards recognised in 2024 was €17 million (2023: €10 million) and the
total equity reserve at year end was €28 million (2023: €10 million).
Estimated future tax obligation
An estimate of the amount that UMG expects to transfer to tax authorities to settle the employees’
tax obligations in relation to all RSU, PSU, PSO and AIP is €335 million (2023: €439 million).
All Employee Award
In October 2022, each eligible employee of UMG was granted 100 shares to be vested at the end
of one-year service period. The grant date share price was €17.25 per share. A total of 0.75 million
shares was granted with the majority vesting in October 2023.
The total expense for these awards recognised in 2024 was €0 million (2023: €9 million) and the total
equity reserve at year end was €0 million (2023: €0 million).
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| Other | Year ended December 31, 2024 | |||
| Corporate | Executive | Corporate | ||
| Directors | Executives | |||
| (millions of euros) | Executives | |||
Short-term employee benefits | 20 | 20 | 40 | |
Post-employment benefits | 1 | - | 1 | |
Other long-term benefits | - | - | - | |
Termination benefits | - | - | - | |
Share-based payments | 66 | 51 | 117 | |
| Corporate Executives | 87 | 71 | 158 |
| Other | Year ended December 31, 2023 | |||
| Corporate | Executive | Corporate | ||
| Directors | Executives | |||
| (millions of euros) | Executives | |||
Short-term employee benefits | 18 | 29 | 47 | |
Post-employment benefits | - | - | - | |
Other long-term benefits | 2 | - | 2 | |
Termination benefits | - | - | - | |
Share-based payments | 70 | 38 | 108 | |
| Corporate Executives | 90 | 67 | 157 |
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| December 31, 2024 | |||||
| (millions of euros) | Associates | Shareholders | Other | Total | |
| Statement of Financial Position | |||||
| Assets | |||||
Trade accounts receivable | 89 | 2 | - | 91 | |
Loans and other receivables | 101 | - | - | 101 | |
Other financial assets | 58 | - | - | 58 | |
| Liabilities | |||||
Trade accounts payable | (1) | - | - | (1) | |
| Statement of Profit or Loss | |||||
Revenue | 286 | 9 | - | 295 | |
Cost of revenues | - | - | - | - | |
Selling, general and administrative expenses | (20) | (2) | (1) | (23) | |
Other financial income | 6 | - | - | 6 |
| December 31, 2023 | |||||
| (millions of euros) | Associates | Shareholders | Other | Total | |
| Statement of Financial Position | |||||
| Assets | |||||
Trade accounts receivable | 52 | 4 | 1 | 57 | |
Loans and other receivables | 105 | - | - | 105 | |
Other financial assets | - | - | - | - | |
| Liabilities | |||||
Trade accounts payable | - | - | - | - | |
| Statement of Profit or Loss | |||||
Revenue | 268 | 8 | 2 | 278 | |
Cost of revenues | - | - | - | - | |
Selling, general and administrative expenses | (2) | (2) | - | (4) | |
Other financial income | - | - | - | - |
MUSIC IS UNIVERSAL Annual Report 2024 | 233
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Legal entity name | Principal country of business |
| Universal Music Group N.V. | Netherlands |
| Universal Music Group, Inc. | United States |
Universal Music Group Holdings, Inc. | United States |
UMG Recordings, Inc. | United States |
| Universal International Music B.V. | Netherlands |
Universal Music Entertainment GmbH | Germany |
Universal Music LLC | Japan |
Universal Music Holdings Ltd. | United Kingdom |
Universal Music Group Treasury S.A.S. | France |
Note 28.
Statutory auditors fees
Fees for audit services include the audit of the financial statements of the UMG and its subsidiaries.
Fees for other audit services include review of interim financial statements, sustainability, and
other audits. Fees for tax services include tax compliance and tax advice. Fees for other non-audit
services include agreed-upon procedures and advisory services. Fees for tax and other non-audit
services are related to the network outside the Netherlands and are in accordance with local
independence regulation.
| Year ended December 31, | |||
(millions of euros) | 2024 | 2023 | |
EY Accountants B.V. | EY Accountants B.V. | ||
Audit of UMG and its subsidiaries | 8 | 8 | |
Other assurance-related fees 1 | - | - | |
Tax services | - | - | |
Other non-audit services | - | - | |
Total 2 | 8 | 8 |
1 Total sustainability audit fees was €0 million (2023: €0 million).
2 Total fees charged by the Dutch organization of EY Accountants B.V. was €3 million (2023: €4 million).
MUSIC IS UNIVERSAL
Annual Report 2024 | 234
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
| Name | Company Number |
Universal International Music B.V. | 31018439 |
Universal Music Publishing International B.V. | 31037866 |
Universal Music Publishing B.V. | 32101966 |
CMHL B.V. | 32140273 |
Universal Production Music B.V. | 85798479 |
| Name | Company Number |
Arabella Musikverlag GmbH | HRB 110271 |
Centre Stage Artist Management GmbH | HRB 66733 |
Deutsche Grammophon Gesellschaft mbH | HRB 138012 |
Dreiklang-Dreimasken, Bühnen- und Musikverlag Gesellschaft mit beschränkter Haftung | HRB 110736 |
G. RICORDI & Co. Bühnen- und Musikverlag GmbH | HRB 153334 |
Musik Edition Discoton, Gesellschaft mit beschränkter Haftung | HRB 110249 |
Rob. Forberg Musikverlag GmbH | HRB 153343 |
Rondor Musikverlag G.m.b.H. | HRB 89705 |
Sheffield Music GmbH | HRB 221164 |
UNIVERSAL / MCA Music Publishing GmbH | HRB 85574 |
Universal Music Entertainment GmbH | HRB 86559 |
Universal Music GmbH | HRB 158632 |
Universal Music Publishing GmbH | HRB 87411 |
Universal Production Music GmbH | HRB 113037 |
Note 30. Subsequent events
The Group has evaluated subsequent events and no events have been identified that could have a
material impact on its financial statements.
MUSIC IS UNIVERSAL Annual Report 2024 | 235
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
COMPANY STATEMENTS
CONTENTS OF COMPANY STATEMENTS
Company Statement of Profit or Loss and Other Comprehensive Income 237
Company Statement of Financial Position 238
Company Statement of Cash Flows 239
Company Statement of Changes in Equity 240
NOTES TO THE COMPANY FINANCIAL STATEMENTS 241
Note 1. General information 241
Note 2. Basis of preparation 241
Note 3. Dividend income 245
Note 4. General and administrative expenses 245
Note 5. Financial income and expenses 245
Note 6. Investments in subsidiaries 245
Note 7. Current and non-current financial assets 246
Note 8. Cash position and borrowings 247
Note 9. Contractual obligations and other commitments 248
Note 10. Equity 250
Note 11. Related parties 252
Note 12. Statutory audit fees 253
Note 13. Subsequent events 253
MUSIC IS UNIVERSAL Annual Report 2024 | 236
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COMPANY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
Year ended December 31,
(millions of euros) Note
2024 2023
Dividend income 3 572 -
General and administrative expenses 4 (3) (7)
Operating profit
569 (7)
Financial income 5 33 43
Financial expenses 5 (207) (142)
Profit/(loss) before income taxes
395 (106)
Income taxes (4) 27
Profit/(loss) after income taxes
391 (79)
Net profit/(loss) attributable to equity holders of the Company
391 (79)
Total comprehensive profit/(loss) attributable to equity holders of the Company
391 (79)
MUSIC IS UNIVERSAL Annual Report 2024 | 237
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
COMPANY STATEMENT OF FINANCIAL POSITION
Year ended December 31,
(millions of euros) Note
2024 2023
Right of use assets - 1
Investments in subsidiaries 6 35,930 35,930
Non-current financial assets 7 4 6
Deferred tax assets 47 30
Non-current assets
35,981 35,967
Current financial assets 7 532 66
Cash and cash equivalents 8 33 1
Current assets
565 67
TOTAL ASSETS
36,546 36,034
Year ended December 31,
(millions of euros) Note
2024 2023
Share capital 18,293 18,217
Additional paid-in capital 15,041 14,994
Treasury Shares (5) (5)
Retained earnings (1,975) (1,442)
Total equity
10 31,354 31,764
Long-term borrowings 8 1,776 1,774
Long-term lease liabilities 1 1
Non-current liabilities
1,777 1,775
Short-term borrowings 8 3,395 2,490
Trade and other payables 20 5
Current liabilities
3,415 2,495
Total liabilities
5,192 4,270
TOTAL EQUITY AND LIABILITIES
36,546 36,034
MUSIC IS UNIVERSAL Annual Report 2024 | 238
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COMPANY STATEMENT OF CASH FLOWS
Year ended December 31,
(millions of euros) Note
2024 2023
Operating activities
Operating profit 569 (7)
Changes in net working capital (1) (7)
Net cash used for operating activities before income tax paid
568
(14)
Income tax paid (4) (4)
Net cash provided by/(used for) operating activities
564 (18)
Investing activities
Increase in financial assets 7 (445) -
Interest received 12 43
Proceeds from subsidiaries on issuance of Share Based
Payments awards 131 495
Net cash provided by/(used for) investing activities
(302) 538
Year ended December 31,
(millions of euros) Note
2024 2023
Financing activities
Distributions to equity holders 10 (933) (929)
Transactions with shareowners
(933) (929)
Proceeds from borrowings 8 4,556 7,198
Repayments of borrowings 8 (3,651) (6,669)
Interest paid (195) (127)
Other cash items related to financial activities (3) (6)
Net cash provided by/(used for) financing activities
(226) (533)
Change in cash and cash equivalents
36 (13)
Cash and cash equivalents
At beginning of the period 8 (3) 10
At end of the period 8 33 (3)
MUSIC IS UNIVERSAL Annual Report 2024 | 239
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COMPANY STATEMENT OF CHANGES IN EQUITY
Year ended December 31, 2024
(millions of euros) Note
Number of shares
(thousands) Share Capital
Additional paid-
in capital Treasury shares Retained Earnings Total equity
BALANCE AS OF DECEMBER 31, 2023
1,821,665 18,217 14,994 (5) (1,442) 31,764
Net profit - - - - 391 391
TOTAL COMPREHENSIVE INCOME
- - - - 391 391
Dividends paid
10 - - - - (933) (933)
Share-based compensation plans
10 7,616 76 47 - 8 131
TOTAL CHANGES OVER THE PERIOD
7,616 76 47 - (925) (802)
BALANCE AS OF DECEMBER 31, 2024
1,829,281 18,293 15,041 (5) (1,976) 31,353
Year ended December 31, 2023
(millions of euros) Note
Number of shares
(thousands) Share Capital
Additional paid-
in capital Treasury shares Retained Earnings Total equity
BALANCE AS OF DECEMBER 31, 2022
1,813,513 18,135 14,935 (5) (721) 32,344
Net loss - - - - (79) (79)
TOTAL COMPREHENSIVE INCOME
- - - - (79) (79)
Dividends paid
10 - - - - (929) (929)
Share-based compensation plans
10 8,152 82 59 - 287 428
TOTAL CHANGES OVER THE PERIOD
8,152 82 59 - (642) (501)
BALANCE AS OF DECEMBER 31, 2023
1,821,665 18,217 14,994 (5) (1,442) 31,764
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
NOTES TO THE COMPANY FINANCIAL STATEMENTS
Note 1. General information
Universal Music Group N.V. (“the Company”) is a public company with limited liability incorporated
under the laws of the Netherlands and listed on Euronext Amsterdam under the symbol ‘UMG.AS’.
The Company was formed to ultimately act as a holding company for Universal Music Group (“UMG”).
The Company’s official seat (statutaire zetel) is in Amsterdam, The Netherlands, and the Company’s
principal office is located at 's-Gravelandseweg 80, 1217 EW Hilversum The Netherlands. The
Company is registered with the Dutch Chamber of commerce under number 81106661.
Incorporation
The Company was incorporated on December 4, 2020. On February 26, 2021, the Company obtained all
of the shares of Universal International Music B.V. and Universal Music Group, Inc. from Vivendi and
the consortium led by Tencent by issuing new shares, to its shareholders.
This internal reorganization of the shareholding structure of UMG was scheduled as part of the
agreement signed in December 2019 by Vivendi and the Tencent-led consortium, a prerequisite for
the company’s planned listing on the stock market.
The prospectus relating to the admission to listing and trading of the shares of the Company on
Euronext Amsterdam was approved by the Dutch Authority for the Financial Markets (Stichting
Autoriteit Financiële Markten) on September 14, 2021 and is available on the Company’s websites.
On September 21, 2021, the shares of the Company started trading on the regulated market of
Euronext Amsterdam.
Note 2.
Basis of preparation
2.1 Statement of compliance
For the year ended December 31, 2024, the Company have prepared its financial statements
in accordance with the IFRS Accounting Standards (IFRS) as issued by International Accounting
Standards Board (IASB), IFRS as endorsed by the European Union (EU) and with the statutory
provisions of Part 9, Book 2 of the Dutch Civil Code. The Company financial statements are prepared
by the Board of Management of the Company and authorized for issue on March 27, 2025 and will be
submitted for adoption to the Annual General Meeting of Shareholders on May 14, 2025.
2.2 Basis of measurement
The Company financial statements were prepared using the same accounting policies as set out
in the notes to the consolidated financial statements at December 31, 2024 (the “Consolidated
financial statements”), except for the measurement of the investments as presented under Note
2.5 in the Company financial statements. The accounting policies were consistently applied to all
periods presented.
2.3 Foreign currency translation
The Company financial statements are presented in millions of euros, unless stated otherwise. The
functional currency of the Company is Euro.
Foreign currency
Foreign currency transactions are initially recorded in the Euros at the exchange rate prevailing at
the date of the transaction. At the closing date, foreign currency monetary assets and liabilities are
translated into the entity’s functional currency at the exchange rate prevailing on that date with
foreign currency differences recorded to profit and loss.
2.4 Recent accounting developments
Accounting policy changes originating from the IFRS amendments
The Company has amended its accounting policies for new or amended IFRS standards and
interpretations that became effective as of 1 January 2024. None of these new or amended standards
and interpretations had a material impact on adoption. These are:
■
Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures;
■
Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback;
■
Amendments to IAS 1 Presentation of Financial Statements - Classification of Liabilities as Current
or Non-current and Non-current Liabilities with Covenants.
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The Company has not early adopted any standards, interpretations or amendments that have been
issued but are not yet effective.
Impact of standards issued but not yet effective
The new and amended standards and interpretations that are issued, but not yet effective, up
to the date of issuance of Company's financial statements are disclosed below. The Company
intends to adopt these new and amended standards and interpretations, if applicable, when they
become effective.
■
Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability,
effective 1 January 2025;
■
Amendments to IFRS 9 Classification and Measurement Requirements and IFRS 7 Disclosures,
effective 1 January 2026;
■
IFRS 18 Presentation and Disclosures in Financial Statements, effective 1 January 2027;
■
IFRS 19 Subsidiaries without Public Accountability: Disclosures, effective 1 January 2027.
Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rate: Lack of Exchangeability.
The amendments, effective for the Company beginning on January 1, 2025, require an entity to
provide certain information about the impact of supplier finance arrangements on liabilities and
cash flows. The Company does not expect that adoption of this standard will have a material impact
on the financial statements.
Amendments to IFRS 9 Classification and Measurement Requirements and IFRS 7 Disclosures
The IASB issued amendments to IFRS 9 classification and measurement requirements and IFRS 7
disclosures effective for UMG on 1 January 2027. The amendments include:
■
The amendments clarify that a financial liability is derecognized on ‘settlement date’ and
introduce an accounting policy choice to derecognise financial liabilities settled using an
electronic payment system before the settlement date;
■
The classification of financial assets with ESG linked features has been clarified via additional
guidance on the assessment of contingent features;
■
Clarifications have been made on non-recourse loans and contractually linked instruments;
■
Additional disclosures are introduced for financial instruments with contingent features and
equity instruments classified at fair value through OCI.
The Company is currently assessing the impact the amendments will have on the
financial statements.
IFRS 18 Presentation and Disclosures in Financial Statements
On April 9, 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements,
which replaces IAS 1 Presentation of Financial Statements. IFRS 18, effective for UMG on 1 January
2027, introduces new requirements on presentation within the statement of profit or loss, including
specified subtotals. It also requires disclosure of management-defined performance measures and
includes enhanced requirements for aggregation and disaggregation of financial information in
the primary financial statements and the notes. The IASB also issued narrow scope amendments
to IAS 7 Statement of Cash Flows, and some requirements previously included within IAS 1 have
been moved to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, which has
been renamed IAS 8 Basis of Preparation of Financial Statements. Other minor amendments were
made to other standards. IFRS 18 and the other amendments are effective for reporting periods
beginning on or after
1 January 2027 and may be adopted early, subject to EU endorsement. The
Company is currently assessing the impact that IFRS 18 and the other amendments will have on the
financial statements.
IFRS 19 Subsidiaries without Public Accountability: Disclosures
Subsidiaries without public accountability of a parent that prepares consolidated financial
statements available for public use are eligible to apply IFRS 19. This standard will not impact the
Company's financial statements.
2.5 Significant judgements and estimates
The preparation of Company financial statements in compliance with IFRS requires management to
make certain judgements and estimates that they consider reasonable and realistic. Although these
judgements and estimates are regularly reviewed by management, based, in particular, on past or
anticipated achievements, facts and circumstances may lead to changes in these judgements and
estimates which could have an impact on the reported amount of group assets, liabilities, equity
or profit.
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The main significant judgements relate to the measurement of:
■
Investment in subsidiaries: valuation method used to identify the recoverable amount of the
asset, refer to Note 2.7.
The main significant estimates relate to the measurement of:
■
Investments in subsidiaries: assumptions on the recoverable amount of the asset, refer to
Note 2.7;
■
Expected credit losses on loans receivable and financial guarantees: estimation of loss allowance
requires assessment of the probability of default on the part of the borrower on a prospective
basis. Reasonable forward-looking information and events, including credit ratings if available,
significant adverse economic changes (actual or expected), financial or business environment
that are expected to result in a material change in the borrower's ability to meet its obligations is
used to assess whether there is significant increase in credit risk, refer to Note 2.9 and 2.11. For
more on financial guarantees, refer to Note 2.14.
2.6 Investments in subsidiaries
Investments in subsidiaries are stated at cost, less impairment.
Dividend income from the Company's subsidiaries is recognized in the statement of profit or loss
when the right to receive payment is established.
2.7 Impairment of investments in subsidiaries
At each reporting date, the Company assesses whether there is an indication that investments in
subsidiaries may be impaired. If any such indication exists, the Company makes an estimate of
the asset's recoverable amount. The recoverable amount is defined as the higher of the fair value
of the investment less cost of disposal and its value in use. Where the carrying amount of an
asset exceeds its recoverable amount, the asset is considered impaired and is written down to its
recoverable amount. The recoverable amount of investments in subsidiaries are determined based
on discounted cash flow models and key assumptions are disclosed in Note 9 of the Consolidated
financial statements. Any resulting impairment is recognized in the income statement.
An assessment is made at each reporting date as to whether there is any indication that previously
recognized impairment losses may no longer exist or may have decreased. If such an indication
exists, the Company makes an estimate of the recoverable amount. A previously recognized
impairment loss is reversed only if there has been a change in the estimates used to determine
the asset's recoverable amount since the last impairment loss was recognized. If that is the case,
the carrying amount of the asset is increased to its recoverable amount, up to a maximum of the
carrying amount that would have been determined if no impairment loss had been recognized for
the asset in prior periods. Such a reversal is recognized in the income statement.
2.8 General and administrative expenses
General and administrative expenses primarily include salaries and employee benefits, consulting
and service fees, overhead recharges, insurance costs, administrative department costs, provisions
for receivables and other operating expenses and are expensed when incurred.
2.9 Loans receivable
Loans receivable are initially recognized at fair value and subsequently measured at amortized cost
using the effective interest rate method, less any value allowances.
The Company assesses the expected credit loss associated with the loans receivable on a
prospective basis. A loss allowance for expected credit loss based on probability of default is
recognized at initial recognition. The loss allowance is updated for changes in these expected credit
losses at each reporting date to reflect changes in credit risk since initial recognition. To assess
whether there has been a significant increase in credit risk, the Company compares the credit risk at
the reporting date with the credit risk at the date of initial recognition based on reasonable forward-
looking information and events, including credit ratings if available, significant adverse economic
changes (actual or expected), financial or business environment that are expected to result in a
material change in the borrower's ability to meet its obligations.
2.10 Cash and cash equivalents
Cash and cash equivalents include all cash balances and short-term highly liquid investments with
an original maturity of three months or less that are readily convertible into known amounts of cash.
There are no liens, pledges, collateral or restrictions on cash and cash equivalents. Cash and cash
equivalents do not include amounts in UMG cash management pools.
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2.11 Financial liabilities
A financial liability is recognized when the Company becomes party to the contractual provisions of
the instrument. At initial recognition, the Company measures financial liabilities at fair value, and for
financial liabilities subsequently measured at amortised cost, including transaction costs and fees
that are directly attributable to their issuance. In most cases, fair value at initial recognition is equal
to transaction price.
Financial liabilities of the Company are all classified and subsequently measured at amortized cost
and measured using the effective interest method.
2.12 Related parties
A related party is a person or an entity that is related to the Company. These include both people and
entities that have, or are subject to, the influence or control of the Company (e.g. key management
personnel). Transactions with related parties are accounted for in accordance with the requirements
of relevant IFRSs and take into account the substance as well as the legal form.
2.13 Contingent liabilities
Contingent liabilities are possible or present obligations of sufficient uncertainty that do not qualify
for recognition as a provision, unless it is assumed in a business combination. Contingent liabilities
are reviewed continuously to assess whether an outflow of resources has become probable.
2.14 Financial guarantees
A financial guarantee is a contract that requires the issuer to make specified payments to reimburse
the holder for a loss it incurs because a specified debtor fails to make payments when due in
accordance with the terms of a debt instrument.
Issued financial guarantees are initially recognised at fair value and are subject to the expected
credit loss model, and a credit loss is recognized for expected cash shortfalls.
Non-financial guarantees are accounted for as a contingent liability until such time it becomes
probable that UMG will be required to make a payment under the guarantee.
2.15 Leases
The lease contracts for the Company correspond to real estate leases for which the Company is the
lessee. Real estate leases for which the Company is the lessee are recorded at the commencement
date and result in the recognition of a lease liability equal to the present value of future lease
payments against a right-of-use asset relating to leases.
Right-of-use assets
Right-of-use assets are measured at cost, less any accumulated depreciation and impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets
includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments
made at or before the commencement date less any lease incentives received. The recognized
right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful
life and the lease term. Amounts received for leasehold improvements are depreciated over a period
not longer than the lease term. Right-of-use assets are subject to impairment.
Lease liabilities
The Company recognizes lease liabilities initially measured at the present value of future lease
payments over the lease term. The lease payments include in-substance fixed payments (less any
lease incentives), variable lease payments that depend on an index or a rate, and amounts expected
to be paid under residual value guarantees. The lease payments also include payments of penalties
for terminating a lease, if the Company has the option to terminate and it is reasonably certain that
this option will be exercised. In calculating the present value of lease payments, the Company uses
the incremental borrowing rate at the lease commencement date if the interest rate implicit in the
lease is not readily determinable.
After the commencement date, the amount of lease liabilities is increased to reflect the accretion
of interest and reduced for the lease payments made. The carrying amount of lease liabilities is
remeasured if there is a modification, a change in the lease term or a change in the in-substance
fixed lease payments.
The Company determines the lease term as the non-cancellable term of the lease, together with
any periods covered by an option to extend the lease if it is reasonably certain to be exercised,
or any periods covered by an option to terminate the lease, if it is reasonably certain not to
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
be exercised. When determining the lease term, the Company considers all relevant facts and
circumstances that create an economic incentive to exercise an extension option, or not to exercise
a termination option.
Note 3. Dividend income
Dividend income for the year ended December 31, 2024 amounted to €572 million (2023: €0) and
related to dividends from Universal International Music B.V. and Universal Music Group, Inc.
Note 4. General and administrative expenses
General and administrative costs consisted of the following:
Year ended December 31,
(millions of euros)
2024 2023
Salaries 11 10
Pension 1 -
Social security and other employment expenses - 1
Wages and expenses
12 11
Legal and professional fees
1
8 10
Audit fees 3 4
Other
2
(26) (18)
Total
(3) 7
Annual average number of full-time equivalent employees, of which none
worked from outside of the Netherlands. 39 39
1 Legal and professional fees mainly relate to legal, financial and consulting services.
2 Other consists of employee and service costs charged to and from subsidiaries and other general overheads.
Note 5. Financial income and expenses
Financial income and expenses consisted of the following:
Year ended December 31,
(millions of euros)
2024 2023
Interest income from intercompany loans 33 43
Financial income
33 43
Interest expense on borrowings (200) (134)
Cost of finance (7) (8)
Financial expenses
(207) (142)
Note 6. Investments in subsidiaries
Investments in subsidiaries consist of the following investments:
Net carrying value
Year ended December 31,
(millions of euros)
Voting % interest 2024 2023
Universal International Music B.V.; Hilversum; The Netherlands 100 21,080 21,080
Universal Music Group, Inc.; Santa Monica; USA 100 14,850 14,850
35,930 35,930
On June 1, 2023, the Company made non-stipulated share premium contributions of €2,175 million
and €755 million to Universal International Music B.V. Refer to Note 7 and 8.
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Net result and equity as per the most recent adopted financial statements:
Net Result Shareholders' Equity
Year ended December 31, Year ended December 31,
2023 2022 2023 2022
Universal International Music B.V.
1
731 (480) 9,680 6,018
Universal Music Group, Inc.
2
579 714 4,517 3,925
1 Millions of euros
2 Millions of US dollars
For a list of indirect subsidiaries and other group entities, refer to Note 27 of the Consolidated
Financial Statements.
Note 7. Current and non-current financial assets
At December 31, 2024, current financial assets consisted primarily of a loan receivable of
€403 million from Universal Music Group, Inc. (“UMG INC”). The loan was issued on 3 April 2024,
primarily for the purpose of funding UMG INC's acquisition of a 25.8% ownership interest in Chord
Music Partner, L.P. and a 28.6% interest in NTWRK.
The loan bears interest at a rate as may be agreed between the Company and UMG INC from time to
time, provided that such rate must be a fair market rate and may not be less than SOFR plus 2.2% per
annum. At December 31, 2024, the accrued interest amounted to €21 million.
Other current financial assets consisted of the following:
Year ended December 31,
(millions of euros)
2024 2023
Current intercompany receivables 7 19
Other intercompany receivables related to share-based compensation 101 47
108 66
Current intercompany receivables primarily consist of a short-term receivable for expenses paid on
behalf of Universal International Music B.V. ("UIM").
Refer to Note 24 of the Consolidated Financial Statements for more details on share-
based compensation.
Non-current financial assets consist of capitalized bank fees of €4 million paid to banks as part of
obtaining the credit facility as disclosed in Note 8, less amortization over the term of the facility.
The Company is exposed to credit risk embedded in these loans receivable being the credit risk of
UIM and UMG INC. The Company assessed potential credit losses on the loans receivable based on
the expected credit loss model (“ECL”), which is designed to be forward-looking. The ECL estimates
were unbiased and included reasonable and supportable information about past events, current
conditions, and forecasts of future economic conditions. UMG Treasury reporting and forecasting
proves sufficient cash generated from the operations of the subsidiaries to fulfill these borrowings.
The effect of the recognized expected credit losses is negligible. The loans are performing in
accordance with the agreements.
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Note 8. Cash position and borrowings
Cash position
Year ended December 31,
(millions of euros)
2024 2023
Cash and cash equivalents 33 1
Bank overdrafts - (4)
Cash and cash equivalents in the statement of cash flows
33 (3)
Borrowings
December 31, 2024 December 31, 2023
(millions of euros)
Total Long-term Short-term Total Long-term Short-term
Bonds 1,810 1,776 34 1,808 1,774 34
Commercial papers 746 - 746 197 - 197
Intercompany payable 2,615 - 2,615 2,255 - 2,255
Bank overdrafts - - - 4 - 4
5,171 1,776 3,395 4,264 1,774 2,490
Borrowings include the following:
■
€500 million of senior unsecured notes issued in June 2022, due on June 30, 2027 with a coupon
of 3.00%;
■
€500 million of senior unsecured notes issued in June 2022, due on June 30, 2032 with a coupon
of 3.75%;
■
€750 million of senior unsecured notes issued in June 2023, due on June 13, 2031 with a coupon
of 4.00%;
■
¥7 billion (€45 million) of senior notes issued in July 2023 and due on July 5, 2038 with a coupon
of 1.61%;
■
€2 billion revolving credit facility extended in February 2023 to April 26, 2028. The facility is
undrawn as at December 31, 2024 and 2023;
■
€500 million short-term bilateral floating rate revolving credit facility entered into in March 2023,
which expired in March 2024;
■
Up to €2 billion NEU commercial paper program established in July 2022.
The intercompany payable consist of a short-term payable to Universal Music Group Treasury S.A.S.
under a Cash Management Agreement.
Financial covenants
During 2024, the Company maintained its Baa1 (with Moody’s) and was upgraded to BBB+ by S&P
- Long Term Credit Ratings. The syndicated RCF financial covenant requires that UMG maintain
Baa2/BBB long term ratings with Moody’s and S&P.
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Movements of borrowings
The movements in borrowings were as follows:
(millions of euros)
Drawn
Revolving
Credit
Facility
Bonds
Bank
Overdrafts
Commercial
Papers
Inter-
company
payable
Total
Balance December
31, 2022
125 1,004 - 929 910 2,968
New borrowings 1,075 794 4 4,738 591 7,202
Repayments (1,200) - - (5,469) - (6,669)
Non-stipulated share
premium contribution - - - - 755 755
Translation differences
and other movements - 10 - (1) - 9
Balance December
31, 2023
- 1,808 4 197 2,256 4,265
New borrowings 300 - - 3,897 359 4,556
Repayments (300) - (4) (3,351) - (3,655)
Dividend receivable - - - - -
Translation differences
and other movements - 2 - 3 - 5
Balance December
31, 2024
- 1,810 - 746 2,615 5,171
Interest rate risk is the risk of the fair value or future cash flows of a financial instrument fluctuating
because of changes in the market interest rates. Financial instruments included in the borrowings
create an inherent interest rate risk.
The Company seeks to limit the period over which interest rates on debt are exposed. The preferred
method of hedging interest rate risk is issuing long term fixed-rate bonds. The use of interest-rate
plain vanilla derivatives is also authorized. The list of authorized instruments includes Interest rate
swaps, FRAs, caps, and floors.
As of December 31, 2024, the Company had a ratio of fixed-rate debt to total outstanding debt of
approximately 71%, including lease liabilities. A sensitivity analysis conducted in January 2025
on the gross debt portfolio shows that if short term EURIBOR were to increase instantaneously by
0.5% from their level asof December 31, 2024, with all other variables held constant, the additional
annualized interest expense would be €4 million.
Note 9. Contractual obligations and other commitments
The table below analyzes the Company's material contractual obligations by expected timing of the
related cash outflows. The amounts disclosed in the table are the contractual undiscounted cash
flows. When future interest rate changes might impact interest on borrowings, interest included in
the cash outflows below is estimated using current market expectations of interest rate movements
(for example, using relevant yield curves).
Contractual obligations
Minimum future payments as of December 31, 2024 Total minimum
future payments
as of
Payments due in
(millions of euros)
Total 1 year 2-5 years After 5 years December 31, 2023
Bonds 2,239 64 735 1,440 2,239
Commercial Papers 754 754 - - 201
Statement of finanical
position items
2,993 818 735 1,440 2,440
Other commitments 660 660 - - -
Total off-balance
sheet commitments
660 660 - - -
Total
3,653 1,478 735 1,440 2,440
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Other commitments
In December 2024, the Company entered into a definitive agreement to acquire Downtown Music
Holdings LLC., for an amount of $775m less net indebtedness and other liabilities. The acquisition is
subject to regulatory approvals and is expected to occur in 2025.
Liquidity risk
The Company is exposed to the liquidity risk. Liquidity risk management ensures the ability to meet
financial obligations as they fall due.
The primary objective of liquidity management is providing for sufficient cash and cash equivalents
to enable the Company to meet its liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Company.
The Company believes that the cash flow generated by the operations of its investments, its cash
surpluses, net of amounts used to reduce UMG's debt, as well as funds available through undrawn
committed bank credit facilities will be sufficient to cover cash outflows necessary for its operations
as well as its debt service for the foreseeable future.
Over the course of the year, fluctuations occur in the working capital needed to finance
operations. The Company strives to have a good liquidity position at all times and optimize daily
cash management. Moreover, the Company strictly controls working capital by optimizing billing
and collection.
Financial guarantees
At December 31, 2024, the Company provided guarantees over certain debt of the following
subsidiaries: Universal Music Group Treasury S.A.S. €184 million; Universal Music Ltda. (Brazil)
€47 million; Universal Music Ltd. (Thailand) €32 million; Universal Music AB (Sweden) €7 million. No
material allowances for credit losses were recognized in the Statement of Financial Position for both
years presented, as the expected credit loss estimation was insignificant and the loans are fully
performing in accordance with the agreements. Financial guarantees were measured at fair value on
initial recognition.
For intercompany financial guarantees issued by the Company no material expected credit loss
was estimated and therefore the financial guarantees are not recognised. In addition, the Company
provided guarantees to several subsidiaries in the UK, Germany and the Netherlands.
The Company has provided guarantees to the following Universal Music Group subsidiaries,
incorporated in the Netherlands, under the registered number indicated, under section 403 of Book 2
of the Dutch Civil Code.
Name
Company Number
Universal International Music B.V. 31018439
Universal Music Publishing International B.V. 31037866
Universal Music Publishing B.V. 32101966
CMHL B.V. 32140273
Universal Production Music B.V. 85798479
The Company is head of the fiscal unity of Universal Music Group in the Netherlands. As a result, the
Company is liable for the tax liability of the fiscal unity in the Netherlands.
In addition UMG has provided guarantees to the following subsidiaries, incorporated in
Germany, under the registered number indicated, under section 264 paragraph 3 of the German
Commercial Code.
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ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
Name
Company Number
Arabella Musikverlag GmbH HRB 110271
Centre Stage Artist Management GmbH HRB 66733
Deutsche Grammophon Gesellschaft mbH HRB 138012
Dreiklang-Dreimasken, Bühnen- und Musikverlag Gesellschaft mit
beschränkter Haftung HRB 110736
G. RICORDI & Co. Bühnen- und Musikverlag GmbH HRB 153334
Musik Edition Discoton, Gesellschaft mit beschränkter Haftung HRB 110249
Rob. Forberg Musikverlag GmbH HRB 153343
Rondor Musikverlag G.m.b.H. HRB 89705
Sheffield Music GmbH HRB 221164
UNIVERSAL / MCA Music Publishing GmbH HRB 85574
Universal Music Entertainment GmbH HRB 86559
Universal Music GmbH HRB 158632
Universal Music Publishing GmbH HRB 87411
Universal Production Music GmbH HRB 113037
Note 10. Equity
Share capital
The Company has an authorized share capital of €27,000 million, divided into 2,700,000,000 ordinary
shares with a nominal value of €10 per share. On December 31, 2024, the issued and fully paid
share capital consisted of 1,829,281,171 ordinary shares with a nominal value of €10 per share (2023:
1,821,665,441 ordinary shares with a nominal value of €10 per share).
The following table summarizes the changes in the number of issued and fully paid up shares of the
Company for the year ended December 31, 2024:
Ordinary Shares
Issued and fully paid up shares as at December 31, 2023
1,821,665,441
Shares issued
1
7,615,730
Issued and fully paid up shares as at December 31. 2024
1,829,281,171
1 In 2024, the Company issued 7,615,730 shares for the purpose of delivering on the share-based executive incentive plan,
refer to Note 24 of the Consolidated Financial Statements for more details.
Additional paid-in capital
Additional paid-in capital represents the premium paid in excess of the par value of shares at the
time of the issuance of new shares. Since the value of the contribution exceeded the par value of the
shares, the balance constituted share premium.
Treasury shares
As at December 31, 2024 the Company held 214,235 shares (2023: 214,235) as Treasury shares.
Dividend distribution
On May 16, 2024 the shareholders approved a dividend distribution of €0.27 per ordinary share,
corresponding to a total distribution of €494 million, payable in June 2024.
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On July 23, 2024 the directors approved an interim dividend distribution of €0.24 per ordinary share,
corresponding to a total distribution of €439 million payable in October 2024.
The Company plans to annually declare and pay dividends to all holders of the Shares on a pro
rata basis in two semi-annual instalments, in the aggregate amount of no less than 50% of the
Company's net profits realized during the relevant financial year, subject to agreed non-cash items.
The Company intends to pay an interim dividend in the fourth quarter of each financial year, after
the publication of the half-year figures of the Company, and a final dividend in the second quarter
of the following financial year, to be paid following approval of the Company's financial statements at
its annual General Meeting.
A proposal will be submitted to the 2025 Annual General Meeting of Shareholders to pay a final
dividend of €0.28 per ordinary share corresponding to a distribution of €512 million, in cash, from the
2024 retained earnings of the Company, payable in Q2 2025. This would bring total dividend for 2024
to €951 million, or €0.52 per ordinary share.
Pursuant to Dutch law, limitations exist relating to the distribution of shareholders’ equity up to at
least the total amount of the share capital as well as other reserves mandated per the Company
Articles of Association. At December 31, 2024, the non-distributable reserves of the Company
amounted to €18,293 million (2023: €18,217 million).
The reconciliation of equity and net (loss)/profit as per the Consolidated financial statements to
equity and net (loss)/profit as per the Company financial statements is provided below:
Reconciliation of equity and net (loss)/profit
Year ended December 31,
(millions of euros)
2024
Equity attributable to Universal Music Group equity holders in the Consolidated
financial statements as at December 31, 2024
4,526
Combined equity pre-incorporation (1,634)
Intra-group restructuring upon incorporation 33,000
Cumulative dividend income received 1,357
Cumulative results of subsidiaries in the Consolidated
financial statements (5,309)
Cumulative expenses and income recognised in other comprehensive
income or directly in equity (586)
Equity in the Company financial statements as at December 31, 2024
31,354
Year ended December 31,
(millions of euros)
2024
Net (loss)/profit attributable to equity holders of the parent in the Consolidated
financial statements
2,086
Results of subsidiaries in the Consolidated financial statements (2,267)
Dividend income 572
Net (loss)/profit in the Company financial statements as at December 31, 2024
391
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Year ended December 31,
(millions of euros)
2023
Equity attributable to Universal Music Group equity holders in the Consolidated
financial statements as at December 31, 2023
2,962
Combined equity pre-incorporation (1,634)
Intra-group restructuring upon incorporation 33,000
Cumulative dividend income received 785
Cumulative results of subsidiaries in the Consolidated
financial statements (3,042)
Cumulative expenses and income recognised in other comprehensive
income or directly in equity (307)
Equity in the Company financial statements as at December 31, 2023
31,764
Year ended December 31,
(millions of euros)
2023
Net (loss)/profit attributable to equity holders of the parent in the Consolidated
financial statements
1,259
Results of subsidiaries in the Consolidated financial statements (1,338)
Net (loss)/profit in the Company financial statements as at December 31, 2023
(79)
Note 11. Related parties
Detailed information on the remuneration of the Board of Directors and senior management is
included in the “Corporate Governance” and “Remuneration of Directors” sections to the Annual
Report. Also refer to Note 25 Related Parties of the Consolidated financial statements.
Executive management compensation
As of December 31, 2024 there were 2 (2023: 2) Executive Directors on the UMG N.V board. Their
aggregate compensation is presented in the table below.
Year ended December 31,
(millions of euros)
2024 2023
Short-term employee benefits 2 3
2 3
The Chairman and CEO is directly remunerated by another group company and this remuneration is
not recharged to the Company.
Non-executive board compensation
As of December 31, 2024, UMG's non-executive board members received director fees of €1 million
(2023: €1 million) and share-based compensation of €1 million (2023: €0 million).
Other related-party transactions
Other related party transactions include:
■
Overhead costs recharged from and to Universal International Music B.V. to a net income amount
of €27 million. Disclosed under “Other” in Note 4;
■
Investments in subsidiaries (Note 6);
■
Receivables from Universal International Music B.V. And Universal Music Group Inc. (Note 7);
■
Financial income on loans granted (Note 5);
■
Intercompany payables (Note 8);
■
Financial Guarantees provided to subsidiaries (Note 9);
■
Guarantee fees received on guarantees provided to subsidiaries (Note 9);
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Note 12. Statutory audit fees
The fees for services provided by the Company’s independent auditors, EY Accountants B.V. and its
member firms and/or affiliates, consisted of the following:
2024 2023
(millions of euros)
EY Accountants B.V. EY Accountants B.V.
Audit of the Company 3 4
Other assurance-related fees
1
- -
Total
3 4
1 Total sustainability audit fees was €0 million (2023: €0 million).
Note 13. Subsequent events
The Company has evaluated subsequent events and no events have been identified that could have
a material impact on its financial statements.
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Other Information
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DISTRIBUTION OF PROFITS
Pursuant to article 32 of the Articles, the distribution of profits shall be made after the adoption of the
financial statements by the General Meeting from which it appears that the distribution is allowed.
The Company may only make distributions to the extent the shareholders’ equity of the Company
exceeds the sum of the paid-up and called-up part of the share capital of the Company and any
reserves that must be maintained pursuant to Dutch law.
The Board may determine which part of the profits shall be reserved, with due observance of the
dividend policy. The General Meeting may resolve to distribute any part of the profits remaining after
such reservation. If the General Meeting does not resolve to distribute these profits in whole or in
part, such profits (or any profits remaining after distribution) shall also be reserved.
Subject to Dutch law, the Board may resolve to make an interim distribution of profits, provided
that it appears from an interim statement of assets and liabilities signed by the Board that the
shareholders’ equity of the Company exceeds the sum of the paid-up and called-up part of the share
capital of the Company and any reserves that must be maintained pursuant to Dutch law.
The Board, or the General Meeting, at the proposal of the Board, may resolve that a distribution shall
not be paid in whole or in part in cash but in kind or in the form of Shares or that Shareholders shall
be given the option to receive the distribution in cash or in kind or in the form of Shares (and with
due observance of the Articles), and may determine the conditions under which such option can be
given to the Shareholders.
Any distribution shall be made pro rata to the respective shareholdings. In calculating the amount
of any distribution, Shares held by the Company shall be disregarded, unless such Shares are
encumbered with a right of pledge or a right of usufruct.
The Board, or the General Meeting, at the proposal of the Board, may resolve to make distributions
from the share premium reserve or other distributable reserves maintained by the Company.
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INDEPENDENT AUDITOR'S REPORT
To: the shareholders and non-executive directors of Universal Music Group N.V.
Report on the audit of the financial statements 2024 included in the Annual Report
Our opinion
We have audited the accompanying financial statements for the financial year ended December 31,
2024 of Universal Music Group N.V. based in Amsterdam, the Netherlands.
In our opinion the financial statements give a true and fair view of the financial position of Universal
Music Group N.V. as at December 31, 2024 and of its result and its cash flows for 2024 in accordance
with IFRS Accounting Standards (IFRSs) as issued by the International Accounting Standards Board
(IASB), IFRSs as adopted in the European Union (EU‑IFRSs) and with Part 9 of Book 2 of the Dutch
Civil Code.
The financial statements comprise:
■
The consolidated and company statement of financial position as at December 31, 2024
■
The following statements for 2024: the consolidated and company statements of profit or loss,
comprehensive income, changes in equity and cash flows
■
The notes comprising material accounting policy information and other explanatory information
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing.
Our responsibilities under those standards are further described in the Our responsibilities for the
audit of the financial statements section of our report.
We are independent of Universal Music Group N.V. (the company) in accordance with the EU
Regulation on specific requirements regarding statutory audit of public-interest entities, the Wet
toezicht accountantsorganisaties (Wta, Audit firms supervision act), the Verordening inzake de
onafhankelijkheid van accountants bij assurance-opdrachten (ViO, Code of Ethics for Professional
Accountants, a regulation with respect to independence) and other relevant independence
regulations in the Netherlands. Furthermore we have complied with the Verordening gedrags- en
beroepsregels accountants (VGBA, Dutch Code of Ethics for professional accountants).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Information in support of our opinion
We designed our audit procedures in the context of our audit of the financial statements as a whole
and in forming our opinion thereon. The following information in support of our opinion and any
findings were addressed in this context, and we do not provide a separate opinion or conclusion on
these matters.
Our understanding of the business
Universal Music Group N.V. is a music company which operates worldwide in over 100 countries. We
paid specific attention in our audit to a number of areas driven by the operations of the group and
our risk assessment.
We determined materiality and identified and assessed the risks of material misstatement of the
financial statements, whether due to fraud or error in order to design audit procedures responsive
to those risks and to obtain audit evidence that is sufficient and appropriate to provide a basis for
our opinion.
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Materiality
Materiality €90 million (2023: €90 million)
Benchmark applied 5% of profit before income taxes, excluding changes in fair value of financial
instruments through profit or loss for 2024
Explanation We determined materiality based on our understanding of the company’s business
and our perception of the financial information needs of users of the financial
statements. We considered profit before income taxes, excluding the volatile
changes in fair value of financial instruments through profit or loss, as an important
metric for users of the financial statements. The benchmark applied and the
percentage used are in line with our 2023 audit.
We have also taken into account misstatements and/or possible misstatements that in our opinion
are material for the users of the financial statements for qualitative reasons.
We agreed with the audit committee of the board of directors that misstatements in excess of
€4.5 million, which are identified during the audit, would be reported to the board of directors, as
well as smaller misstatements that in our view must be reported on qualitative grounds.
Scope of the group audit
Universal Music Group N.V. is at the head of a group of entities. The financial information of this
group is included in the financial statements.
We are responsible for planning and performing the group audit to obtain sufficient appropriate
audit evidence regarding the financial information of the entities or business units within the group
as a basis for forming an opinion on the financial statements. We are also responsible for the
direction, supervision, review and evaluation of the audit work performed for purposes of the group
audit. We bear the full responsibility for the auditor’s report.
Based on our understanding of the group and its environment, the applicable financial framework
and the group’s system of internal control, we identified and assessed risks of material
misstatement of the financial statements and the significant accounts and disclosures. Based
on this risk assessment, we determined the nature, timing and extent of audit work performed,
including the entities or business units within the group (components) at which to perform audit
work. For this determination we considered the nature of the relevant events and conditions
underlying the identified risks of material misstatements for the financial statements, the
association of these risks to components and the materiality or financial size of the components
relative to the group.
We communicated the audit work to be performed and identified risks through instructions for
component auditors as well as requesting component auditors to communicate matters related to
the financial information of the component that is relevant to identifying and assessing risks.
We have:
■
Performed audit procedures ourselves in respect of areas such as the consolidation, disclosures,
impairment testing for goodwill and other non-current assets, financial instruments, acquisitions
and divestments, share-based compensation, loans and borrowings, equity investments
and taxes
■
Used the audit work of component auditors from EY Global member firms working under our
supervision for selected components in the United States, the United Kingdom, Japan, France,
Germany and the group shared service center components
This resulted in a coverage of 86% of the profit before income taxes (excluding changes in fair value
of financial instruments through profit or loss), 84% of revenue and 88% of total assets. For the
component in China we performed specified audit procedures. For other components, we performed
analytical procedures to corroborate that our risk assessment and scoping remained appropriate
throughout the audit.
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We performed site visits to meet with local management and component teams, observe the
component operations, discuss the group risk assessment and the risks of material misstatements
for the components in the United States, the United Kingdom, Japan, France and Germany. We
reviewed and evaluated the adequacy of the deliverables from component auditors and reviewed
key working papers for selected components to address the risks of material misstatement. We
held planning meetings, key meetings required based on circumstances and we attended closing
meetings with local management and component teams for the United States, the United Kingdom,
Japan, France and Germany. During these meetings and calls, amongst others, the planning,
procedures performed based on risk assessments, findings and observations were discussed and
any further work deemed necessary by the primary or component team was then performed.
By performing the audit work mentioned above at the entities or business units within the
group, together with additional work at group level, we have been able to obtain sufficient and
appropriate audit evidence about the group’s financial information to provide an opinion on the
financial statements.
Teaming and use of specialists
We ensured that the audit teams both at group and at component levels included the appropriate
skills and competences which are needed for the audit of a listed client in the Media and
Entertainment industry. We included specialists in the areas of IT audit, forensics, sustainability,
share based payments and income tax and have made use of our own experts in the areas of
valuations (Goodwill and Catalogues) and actuaries.
Our focus on climate-related risks and the energy transition
Climate change and the energy transition are high on the public agenda. Issues such as CO
2
reduction impact financial reporting, as these issues entail risks for the business operation, the
valuation of assets and provisions or the sustainability of the business model and access to
financial markets of companies with a larger CO
2
footprint.
The board of directors summarized the Universal Music Group N.V.’s commitments and obligations,
and reported in the Sustainability Statement of the board report how the company is addressing
climate-related and environmental risks. Furthermore, the board of directors discloses its
assessment and implementation plans in connection to climate-related risks and the effects of
energy transition.
As part of our audit of the financial statements, we evaluated the extent to which climate-related
risks and the effects of the energy transition and the company’s commitments and (constructive)
obligations, are taken into account in estimates and significant assumptions. Furthermore, we
read the board report and considered whether there is any material inconsistency between the
non-financial information and the financial statements.
Based on the audit procedures performed, we do not deem climate-related risks to have a material
impact on the financial reporting judgements, estimates or significant assumptions as at December
31, 2024.
Our focus on fraud and non-compliance with laws and regulations
Our responsibility
Although we are not responsible for preventing fraud or non-compliance and we cannot be expected
to detect non-compliance with all laws and regulations, it is our responsibility to obtain reasonable
assurance that the financial statements, taken as a whole, are free from material misstatement,
whether caused by fraud or error. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
Our audit response related to fraud risks
We identified and assessed the risks of material misstatements of the financial statements due to
fraud. During our audit we obtained an understanding of the company and its environment and
the components of the system of internal control, including the risk assessment process and the
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board of directors’ process for responding to the risks of fraud and monitoring the system of internal
control and how the non-executive directors, advised by the audit committee, exercises oversight, as
well as the outcomes. We refer to section Risk and Risk Management of the board report for board of
directors’ (fraud) risk assessment.
We evaluated the design and relevant aspects of the system of internal control and in particular
the fraud risk assessment, as well as UMG’s Code of Conduct, standalone Whistleblowing Policy
and incident registration. We evaluated the design and the implementation and, where considered
appropriate, tested the operating effectiveness, of internal controls designed to mitigate fraud risks.
As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect
to financial reporting fraud, misappropriation of assets and bribery and corruption in close co-
operation with our forensic specialists. We evaluated whether these factors indicate that a risk of
material misstatement due to fraud is present.
We incorporated elements of unpredictability in our audit. We also considered the outcome of
our other audit procedures and evaluated whether any findings were indicative of fraud or non-
compliance.
We addressed the risks related to management override of controls, as this risk is present in all
organizations. For these risks we have performed procedures among other things to evaluate key
accounting estimates for management bias that may represent a risk of material misstatement due
to fraud, in particular relating to important judgment areas and significant accounting estimates
as disclosed in Note 2.2 to the consolidated financial statements under “Accounting Estimates and
Judgements”. We have also used data analysis to identify and address high-risk journal entries
and evaluated the business rationale (or the lack thereof) of significant extraordinary transactions,
including those with related parties.
The following fraud risks identified required significant attention during our audit.
Presumed risks of fraud in revenue recognition
Fraud risk We presumed that there are risks of fraud in revenue recognition. We evaluated that
the contractual agreements and conditions of streaming and subscription revenue
in particular give rise to such risks.
Our audit approach We describe the audit procedures responsive to the presumed risk of fraud
in revenue recognition in the description of our audit approach for the key
audit matter:
■
Revenue recognition for streaming and subscriptions
We considered available information and made enquiries of relevant executives, directors, internal
audit, legal, compliance, human resources and regional directors and the non-executive directors.
The fraud risks we identified, enquiries and other available information did not lead to specific
indications for fraud or suspected fraud potentially materially impacting the view of the
financial statements.
Our audit response related to risks of non-compliance with laws and regulations
We performed appropriate audit procedures regarding compliance with the provisions of those laws
and regulations that have a direct effect on the determination of material amounts and disclosures
in the financial statements. Furthermore, we assessed factors related to the risks of non-compliance
with laws and regulations that could reasonably be expected to have a material effect on the
financial statements from our general industry experience, through discussions with the board
of directors and key management personnel, reading minutes, inspection of internal audit and
compliance reports, and performing substantive tests of details of classes of transactions, account
balances or disclosures.
We also inspected lawyers’ letters and correspondence with regulatory authorities and remained
alert to any indication of (suspected) non-compliance throughout the audit. Finally we obtained
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written representations that all known instances of non-compliance with laws and regulations have
been disclosed to us.
Our audit response related to going concern
As disclosed in section Basis of preparation and consolidation in Note 2.2 to the financial
statements, the financial statements have been prepared on a going concern basis. When preparing
the financial statements, the board of directors made a specific assessment of the company’s ability
to continue as a going concern and to continue its operations for the foreseeable future.
We discussed and evaluated the specific assessment with the board of directors exercising
professional judgment and maintaining professional skepticism.
We considered whether the board of directors’ going concern assessment, based on our knowledge
and understanding obtained through our audit of the financial statements or otherwise, contains all
relevant events or conditions that may cast significant doubt on the company’s ability to continue as
a going concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditor’s report to the related disclosures in the financial statements or, if such disclosures
are inadequate, to modify our opinion.
Based on our procedures performed, we did not identify material uncertainties about going concern.
Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause a company to cease to continue as a going concern.
Our key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance
in our audit of the financial statements. We have communicated the key audit matters to the audit
committee of the board of directors. The key audit matters are not a comprehensive reflection of all
matters discussed.
In comparison with previous year, the nature of our key audit matters did not change.
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Revenue recognition for streaming and subscriptions
Risk Subscriptions and streaming revenues represent the largest type of recorded music revenue and account for 51% (51% in 2023) of total UMG revenue. The streaming and subscription
revenues of the Company are driven through global digital contracts and recognized over time. The total amount of streaming and subscription revenue recognized for the year ended
December 31, 2024 amounts to EUR 6.0 billion (2023: EUR 5.7 billion).
As described in Note 2.3.5 and Note 3 to the consolidated financial statements, revenues from contracts with customers are recognized when performance obligations included in the
contract are satisfied, and for an amount for which it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur. As described in Note
2.2 to the consolidated financial statements, significant judgement is required to identify performance obligations under contracts with customers and to determine whether these
performance obligations are satisfied, among other factors.
We consider this to be a key audit matter due to the complexity of the contractual terms and conditions and the significant judgements applied by management in its revenue
recognition. Moreover, we presumed that there are risks of fraud in revenue recognition for streaming and subscriptions.
Our audit approach Our audit procedures included, among others, evaluating the appropriateness of the Company’s revenue recognition policies for streaming and subscription revenue in accordance with
IFRS 15 “Revenue from Contracts with Customers” and whether the policies have been applied consistently or whether changes, if any, are appropriate in the circumstances.
We performed the following procedures, among others:
■
We gained insight in the process for identifying and accounting for specific revenue terms and conditions included in contracts with digital sales partners
■
We evaluated the design and implementation of controls that address the identified risks
■
We performed contract reviews on significant contracts with digital sales partners in order to verify if these are recognized in accordance with IFRS 15
■
We evaluated management’s judgement on revenue recognition for specific contractual terms, based on the relevant digital revenue contracts, (monthly) information from digital
sales partners and reconciled this to revenue recorded in the financial administration
■
We performed a look-back analysis on management’s judgement made on the prior year recognition of revenue for specific contractual terms
■
We also evaluated the adequacy of the disclosures provided by the Company
Key observations We did not identify any material misstatements in the revenue recorded for 2024, either due to fraud or error.
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Valuation of royalty advances to artists and repertoire owners
Risk The Company provides royalty advances to artists and repertoire owners. As of December 31, 2024, the total amount of royalty advances amounted to EUR 3.3 billion (2023:
EUR 2.6 billion).
As described in Note 2.3.8 and Note 10 to the consolidated financial statements, these advances to artists, songwriters and co-publishers are capitalized as an asset when their current
popularity and past performances provide a reasonable basis to conclude that a future recoupment of such royalty advances against earnings otherwise payable to them is reasonably
assured. Royalty advances are recognized as an expense as subsequent royalties are earned by the artist, songwriter or co-publisher. Any portion of capitalized royalty advances not
deemed to be recoverable against future royalties is expensed during the period in which the loss becomes evident.
As described in Note 2.2 to the consolidated financial statements, estimation of the future performance of artists and repertoire owners is considered a significant management
estimate, for evaluating whether capitalized royalty advances are recoverable against future earnings and mainly relates to the estimated future earnings performance of artists,
songwriters and co-publishers.
We consider this to be a key audit matter based on the significant judgements applied by management in valuing royalty advances.
Our audit approach As part of our audit procedures, we obtained an understanding of the estimation process and management’s application of the related accounting policies. Specifically, we evaluated
the Company’s accounting policy over recognition and measurement of royalty advances in accordance with IAS 38 “Intangible assets”. Furthermore, we performed, amongst others, the
following audit procedures:
■
We obtained an understanding of the estimation models for determining the future projections relating to royalty advances
■
We evaluated the contracts and payments relating to material royalty advances during the year
■
We tested the recoupment for 2024 of new and existing royalty advances capitalized with material net exposure as at December 31, 2024
■
We assessed the recoverability of net advances and related future contractual commitments by performing sensitivity analyses on historical recoupment
run-rates to evaluate the assumptions made by management in its royalty advances recoverability analysis
■
We assessed the classification of advances between Non-current royalty advances and Current royalty advances recorded on the Company’s statement of financial position
■
We performed a look-back analysis on management’s judgement and estimates made in prior year valuation of royalty advances
■
We evaluated the adequacy of the disclosures
Key observations We did not identify any material misstatements in the valuation of royalty advances to artists and repertoire owners as at December 31, 2024.
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Valuation of music catalogues
Risk The Company has presented Catalogues (of music and publishing rights) - hereinafter: music catalogues - on the balance sheet as of December 31, 2024 amounting to EUR 3.4 billion
(2023: EUR 3.0 billion).
As described in Note 2.3.8 to the consolidated financial statements, music catalogues are recognized at cost, and music catalogues acquired in a business combination are recorded at
their fair value at the acquisition date. Amortization expenses are charged on a straight-line basis over the estimated useful life. Annually, impairment tests are performed to compare
the future cash flows of each music catalogue against the carrying amount.
As described in Note 2.2, the Company identifies a significant estimate relating to the assumptions in the impairment tests performed as well as the determination of the (remaining)
useful life for the music catalogues.
As the related amounts of the music catalogues presented are significant and the estimation involved includes significant judgement applied by management, we consider this a key
audit matter.
Our audit approach As part of our audit procedures, we obtained an understanding of the estimation process to determine the valuation of the music catalogues and the Company’s application of the
related accounting policies. We evaluated the Company’s accounting policies over recognition and measurement of music catalogues for compliance with IAS 36 “Impairment of assets”
and IAS 38 “Intangible assets”. Additionally, we performed, amongst others, the following audit procedures:
■
We obtained an understanding of management’s information model to determine the qualitative and quantitative factors supporting the catalogues’ useful life, such as the asset’s
expected pattern of the future earnings and the period of the contractual arrangements
■
We assessed the historical revenues associated with the music catalogues, along with forecasted revenues, in order to assess the appropriateness of the catalogues’ (remaining)
useful life
■
We evaluated management’s impairment indicator assessment over catalogues, and, in case of an impairment indicator identified by management, we evaluated the impairment
assessment to determine whether any impairment should be recorded as at December 31, 2024
■
We evaluated the adequacy of the disclosures to the financial statements
Key observations We did not identify any material misstatements in the valuation of music catalogues as at December 31, 2024.
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Report on other information included in the annual report
The annual report contains other information in addition to the financial statements and our
auditor’s report thereon.
Based on the following procedures performed, we conclude that the other information:
■
Is consistent with the financial statements and does not contain material misstatements
■
Contains the information as required by Part 9 of Book 2 of the Dutch Civil Code for the
management report (excluding the sustainability statement) and the other information as
required by Part 9 of Book 2 of the Dutch Civil Code and as required by Sections 2:135b and
2:145 sub‑section 2 of the Dutch Civil Code for the remuneration report
We have read the other information. Based on our knowledge and understanding obtained
through our audit of the financial statements or otherwise, we have considered whether the other
information contains material misstatements. By performing these procedures, we comply with the
requirements of Part 9 of Book 2 and Section 2:135b sub-Section 7 of the Dutch Civil Code and the
Dutch Standard 720. The scope of the procedures performed is substantially less than the scope of
those performed in our audit of the financial statements.
The board of directors is responsible for the preparation of the other information, including the
management report, in accordance with Part 9 of Book 2 of the Dutch Civil Code and other
information required by Part 9 of Book 2 of the Dutch Civil Code. The board of directors is
responsible for ensuring that the remuneration report is drawn up and published in accordance
with Sections 2:135b and 2:145 sub-section 2 of the Dutch Civil Code.
Report on other legal and regulatory requirements and ESEF
Engagement
We were engaged by the general meeting as auditor of Universal Music Group N.V. on September 20,
2021, as of the audit for the year 2021 and have operated as statutory auditor ever since that date.
No prohibited non-audit services
We have not provided prohibited non-audit services as referred to in Article 5(1) of the EU Regulation
on specific requirements regarding statutory audit of public-interest entities.
European Single Electronic Reporting Format (ESEF)
Universal Music Group N.V. has prepared the annual report in ESEF. The requirements for this are set
out in the Delegated Regulation (EU) 2019/815 with regard to regulatory technical standards on the
specification of a single electronic reporting format (hereinafter: the RTS on ESEF).
In our opinion the annual report prepared in the XHTML format, including the (partially) marked-up
consolidated financial statements as included in the reporting package by Universal Music Group
N.V., complies in all material respects with the RTS on ESEF.
The board of directors is responsible for preparing the annual report, including the financial
statements, in accordance with the RTS on ESEF, whereby the board of directors combines the
various components into a single reporting package.
Our responsibility is to obtain reasonable assurance for our opinion whether the annual report in
this reporting package complies with the RTS on ESEF.
We performed our examination in accordance with Dutch law, including Dutch Standard
3950N, ”Assurance-opdrachten inzake het voldoen aan de criteria voor het opstellen van een digitaal
verantwoordingsdocument” (assurance engagements relating to compliance with criteria for digital
reporting). Our examination included amongst others:
■
Obtaining an understanding of the company’s financial reporting process, including the
preparation of the reporting package
■
Identifying and assessing the risks that the annual report does not comply in all material respects
with the RTS on ESEF and designing and performing further assurance procedures responsive to
those risks to provide a basis for our opinion, including:
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– Obtaining the reporting package and performing validations to determine whether the reporting
package containing the Inline XBRL instance document and the XBRL extension taxonomy files,
has been prepared in accordance with the technical specifications as included in the RTS
on ESEF
– Examining the information related to the consolidated financial statements in the reporting
package to determine whether all required mark-ups have been applied and whether these are
in accordance with the RTS on ESEF
Description of responsibilities regarding the financial statements
Responsibilities of the board of directors for the financial statements
The board of directors is responsible for the preparation and fair presentation of the financial
statements in accordance with IFRSs as issued by the IASB, EU-IFRSs and Part 9 of Book 2 of the
Dutch Civil Code. Furthermore, the board of directors is responsible for such internal control as the
board of directors determines is necessary to enable the preparation of the financial statements that
are free from material misstatement, whether due to fraud or error.
As part of the preparation of the financial statements, the board of directors is responsible for
assessing the company’s ability to continue as a going concern. Based on the financial reporting
framework mentioned, the board of directors should prepare the financial statements using the
going concern basis of accounting unless the board of directors either intends to liquidate the
company or to cease operations, or has no realistic alternative but to do so. The board of directors
should disclose events and circumstances that may cast significant doubt on the company’s ability
to continue as a going concern in the financial statements.
The non-executive directors, advised by the audit committee, are responsible for overseeing the
company’s financial reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit engagement in a manner that allows us to obtain
sufficient and appropriate audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we may
not detect all material misstatements, whether due to fraud or error during our audit.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements. The materiality affects the nature, timing and extent of our
audit procedures and the evaluation of the effect of identified misstatements on our opinion.
We have exercised professional judgment and have maintained professional skepticism throughout
the audit, in accordance with Dutch Standards on Auditing, ethical requirements and independence
requirements. The Information in support of our opinion section above includes an informative
summary of our responsibilities and the work performed as the basis for our opinion. Our audit
further included among others:
■
Performing audit procedures responsive to the risks identified, and obtaining audit evidence that
is sufficient and appropriate to provide a basis for our opinion
■
Obtaining an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the company’s internal control
■
Evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the board of directors
■
Evaluating the overall presentation, structure and content of the financial statements, including
the disclosures
■
Evaluating whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation
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Communication
We communicate with the audit committee of the board of directors regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any significant
findings in internal control that we identify during our audit. In this respect we also submit an
additional report to the audit committee in accordance with Article 11 of the EU Regulation on
specific requirements regarding statutory audit of public-interest entities. The information included
in this additional report is consistent with our audit opinion in this auditor’s report.
We provide the audit committee of the board of directors with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, related safeguards.
From the matters communicated with the audit committee of the board of directors, we determine
the key audit matters: those matters that were of most significance in the audit of the financial
statements. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, not communicating
the matter is in the public interest.
Amsterdam, March 27, 2025
EY Accountants B.V.
Signed by F.J. Blenderman
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LIMITED ASSURANCE REPORT OF THE INDEPENDENT AUDITOR ON
THE SUSTAINABILITY STATEMENT
To: the shareholders and non-executive directors of Universal Music Group N.V.
Our conclusion
We have performed a limited assurance engagement on the consolidated sustainability statement
for the financial year ended December 31, 2024 of Universal Music Group N.V. based in Amsterdam,
the Netherlands in section ‘Sustainability statement’ of the accompanying board report including
the information incorporated in the sustainability statement by reference (hereinafter: the
sustainability statement).
Based on our procedures performed and the evidence obtained, nothing has come to our attention
that causes us to believe that the sustainability statement is not, in all material respects:
■
prepared in accordance with the European Sustainability Reporting Standards (ESRS) as adopted
by the European Commission and compliant with the double materiality assessment process
carried out by Universal Music Group N.V. to identify the information reported pursuant to the
ESRS; and
■
compliant with the reporting requirements provided for in Article 8 of Regulation (EU) 2020/852
(Taxonomy Regulation).
Our conclusion has been formed on the basis of the matters outlined in this limited
assurance report.
Basis for our conclusion
We have performed our limited assurance engagement on the sustainability statement in
accordance with Dutch law, including Dutch Standard 3810N, “Assurance-opdrachten inzake
duurzaamheidsverslaggeving” (Assurance engagements relating to sustainability reporting), which
is a specified Dutch standard that is based on the International Standard on Assurance
Engagements (ISAE) 3000 (Revised), “Assurance engagements other than audits or reviews of
historical financial information”.
Our assurance engagement was aimed to obtain a limited level of assurance that the sustainability
statement is free from material misstatements. The procedures vary in nature and timing from,
and are less in extent than for, a reasonable assurance engagement. Consequently, the level of
assurance obtained in a limited assurance engagement is substantially lower than the assurance
that would have been obtained had a reasonable assurance engagement been performed. Our
responsibilities in this regard are further described in the section ‘Our responsibilities for the limited
assurance engagement on the sustainability statement’ of our report.
We are independent of Universal Music Group N.V. in accordance with the Verordening inzake de
onafhankelijkheid van accountants bij assurance-opdrachten (ViO, Code of Ethics for Professional
Accountants, a regulation with respect to independence) and other relevant independence
regulations in the Netherlands. This includes that we do not perform any activities that could result
in a conflict of interest with our independent assurance engagement and we are not involved in
the preparation of thesustainability statement, as doing so may compromise our independence.
Furthermore, we have complied with the Verordening gedrags- en beroepsregels accountants (VGBA,
Dutch Code of Ethics for Professional Accountants). The ViO and VGBA are at least as demanding as
the International code of ethics for professional accountants (including International independence
standards) of the International Ethics Standards Board for Accountants (the IESBA Code) as relevant
to limited assurance engagements on sustainability statements of public interest entities in the
European Union.
We believe that the assurance evidence we have obtained is sufficient and appropriate to provide a
basis for our conclusion.
Emphasis of matter
The sustainability statement has been prepared in a context of new sustainability reporting
standards, requiring entity-specific interpretations and addressing inherent measurement or
evaluation uncertainties. In this context, we want to emphasize the following matters:
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Emphasis on the most significant uncertainties affecting the quantitative metrics and
monetary amounts
We draw attention to section ESRS 2 General Disclosures in the sustainability statement that
identifies the quantitative metrics and monetary amounts that are subject to a high level
of measurement uncertainty and discloses information about the sources of measurement
uncertainty and the assumptions, approximations and judgements Universal Music Group N.V.
has made in measuring these in compliance with the ESRS. The comparability of sustainability
information between entities and over time may be affected by the lack of historical sustainability
information in accordance with the ESRS and by the absence of a uniform practice on which to draw,
to evaluate and measure this information. This allows for the application of different, but acceptable,
measurement techniques, especially in the initial years.
Emphasis on the double materiality assessment process
We draw attention to section Our Double Materiality Assessment Process in the sustainability
statement. This disclosure explains future improvements in the ongoing due diligence and double
materiality assessment process, including robust engagement with affected stakeholders. Due
diligence is an ongoing practice that responds to and may trigger changes in the company’s
strategy, business model, activities, business relationships, operating, sourcing and selling contexts.
The double materiality assessment process requires Universal Music Group N.V. to make key
judgments and use thresholds and may also be impacted in time by sector-specific standards
to be adopted. Therefore, the sustainability statement may not include every impact, risk and
opportunity or additional entity-specific disclosure that each individual stakeholder (group) may
consider important in its own particular assessment.
Our conclusion is not modified in respect of these matters.
Comparative information not assured
Sustainability information for 2023 and earlier included in the sustainability statement, has not been
part of this limited assurance engagement. Consequently, we do not provide any assurance on the
comparative information and thereto related disclosures in the sustainability statement for 2023
and earlier.
Our conclusion is not modified in respect of this matter.
Limitation to the scope of our assurance engagement
In reporting forward-looking information in accordance with the ESRS, the board of directors
describes the underlying assumptions and methods of producing the information, as well as
other factors that provide evidence that it reflects the actual plans or decisions made by the
company (actions). Forwardlooking information relates to events and actions that have not yet
occurred and may never occur. The actual outcome is likely to be different since anticipated events
frequently do not occur as expected. We do not provide assurance on the achievability of forward-
looking information.
Our conclusion is not modified in respect of this matter.
Responsibilities of the board of directors for the sustainability statement
The board of directors is responsible for the preparation of the sustainability statement in
accordance with the ESRS, including the double materiality assessment process carried out by
Universal Music Group N.V. as the basis for the sustainability statement and disclosure of material
impacts, risks and opportunities in accordance with the ESRS. As part of the preparation of the
sustainability statement, the board of directors is responsible for compliance with the reporting
requirements provided for in Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation). The board
of directors is also responsible for selecting and applying additional entity-specific disclosures to
enable users to understand the company’s sustainability-related impacts, risks or opportunities and
for determining that these additional entity-specific disclosures are suitable in the circumstances
and in accordance with the ESRS.
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Furthermore, the board of directors is responsible for such internal control as it determines is
necessary to enable the preparation of the sustainability statement that is free from material
misstatement, whether due to fraud or error.
The non-executive directors, advised by the audit committee, are responsible for overseeing the
sustainability reporting process including the double materiality assessment process carried out by
Universal Music Group N.V.
Our responsibilities for the limited assurance engagement on the
sustainability statement
Our responsibility is to plan and perform the limited assurance engagement in a manner that allows
us to obtain sufficient and appropriate assurance evidence for our conclusion.
We apply the applicable quality management requirements pursuant to the Nadere voorschriften
kwaliteitsmanagement (NVKM, regulations for quality management) and the International Standard
on Quality Management (ISQM) 1, and accordingly maintain a comprehensive system of quality
management including documented policies and procedures regarding compliance with ethical
requirements, professional standards and other relevant legal and regulatory requirements.
Our limited assurance engagement included amongst others:
■
Performing inquiries and an analysis of the external environment and obtaining an
understanding of relevant sustainability themes and issues, the characteristics of the company,
its activities and the value chain and its key intangible resources in order to assess the double
materiality assessment process carried out by the company as the basis for the sustainability
statement and disclosure of all material sustainability-related impacts, risks and opportunities in
accordance with the ESRS
■
Obtaining through inquiries a general understanding of the internal control environment, the
company’s processes for gathering and reporting entity-related and value chain information, the
information systems and the company’s risk assessment process relevant to the preparation of
the sustainability statement and for identifying the company’s activities, determining eligible
and aligned economic activities and prepare the disclosures provided for in Article 8 of
Regulation (EU) 2020/852 (Taxonomy Regulation), without obtaining assurance information about
the implementation or testing the operating effectiveness of controls
■
Assessing the double materiality assessment process carried out by the company and identifying
and assessing areas of the sustainability statement, including the disclosures provided for in
Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation), where misleading or unbalanced
information or material misstatements, whether due to fraud or error, are likely to arise (‘selected
disclosures’). Designing and performing further assurance procedures aimed at assessing that
the sustainability statement is free from material misstatements responsive to this risk analysis.
■
Considering whether the description of the double materiality assessment process in the
sustainability statement made by the board of directors appears consistent with the process
carried out by the company.
■
Performing analytical review procedures on quantitative information in the sustainability
statement, including consideration of data and trends.
■
Assessing whether the company’s methods for developing estimates are appropriate and have
been consistently applied for selected disclosures. We considered data and trends, however our
procedures did not include testing the data on which the estimates are based or separately
developing our own estimates against which to evaluate the board of directors’ estimates.
■
Analyzing, on a limited sample basis, relevant internal and external documentation available to
the company (including publicly available information or information from actors throughout its
value chain) for selected disclosures.
■
Reading the other information in the annual report to identify material inconsistencies, if any,
with the sustainability statement.
■
Considering whether the disclosures provided to address the reporting requirements provided
for in Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation) for each of the environmental
objectives, reconcile with the underlying records of the company and are consistent or coherent
with the sustainability statement, appear reasonable, in particular whether the eligible economic
activities meet the cumulative conditions to qualify as aligned and whether the technical
screening criteria are met, and whether the key performance indicators disclosures have been
defined and calculated in accordance with the Taxonomy reference framework, and comply
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with the reporting requirements provided for in Article 8 of Regulation (EU) 2020/852 (Taxonomy
Regulation), including the format in which the activities are presented.
■
Considering the overall presentation, structure and fundamental qualitative characteristics of
information (relevance and faithful representation: complete, neutral and accurate) reported in
the sustainability statement, including the reporting requirements provided for in Article 8 of
Regulation (EU) 2020/852 (Taxonomy Regulation).
■
Considering, based on our limited assurance procedures and evaluation of the evidence obtained,
whether the sustainability statement as a whole, is free from material misstatements and
prepared in accordance with the ESRS.
Communication
We communicate with the audit committee of the board of directors regarding, among other matters,
the planned scope and timing of the assurance engagement and significant findings that we identify
during our assurance engagement.
Amsterdam, March 27, 2025
EY Accountants B.V.
Signed by F.J. Blenderman
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Appendix
ABOUT UMG BOARD REPORT NON-EXECUTIVE DIRECTORS' REPORT FINANCIAL STATEMENTS OTHER INFORMATION APPENDIX
BIOGRAPHIES OF THE CORPORATE EXECUTIVES
Sir Lucian Grainge
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
Sir Lucian Grainge has spent his entire career in the music industry and has
signed and worked with many worldwide stars, including ABBA, Jay Z, Elton
John, Katy Perry, Queen, Rihanna, The Rolling Stones, Sam Smith, U2 and Amy
Winehouse, among many others.
During the span of four decades, he not only pioneered new approaches to the signing and
development of the world’s most successful recording artists and songwriters, he also consistently
championed the development of innovative business models and partnerships with a wide range
of technology and media partners around the world. He has transformed Universal Music Group
(UMG) into the most successful company in the history of the music industry, both competitively and
financially, and his vision and leadership is widely recognized as having returned the entire industry
to growth after years of decline. In 2011, he led UMG’s successful acquisition of the recorded music
assets of the legendary British music company EMI, revitalizing its iconic Capitol Records, and, in the
process, further strengthening UMG’s position as the global leader in music.
A native of London, Sir Lucian was bestowed with a knighthood in 2016 by Her Majesty Queen
Elizabeth II in the Queen’s 90th Birthday Honours list for accomplishments in the music industry
and leadership through its challenging times, contributions to British business and inward
investment, as well as his development of innovative business models, technology and media
partnerships that have expanded UMG’s global presence.
Philippe Flageul
EXECUTIVE VICE PRESIDENT, CONTROLLER
Philippe Flageul is Executive Vice President, Controller for Universal Music
Group. He is responsible for overseeing many aspects of UMG’s finance
operations, including accounting, tax, treasury, risk management and IT and
supply chain finance. He also oversees UMG’s global procurement. Flageul joined UMG in 2015 from
Bolloré Group, where he worked for more than two decades as CFO of the industrial division and
Chairman of IER. Flageul holds an MBA from EDHEC.
Jody Gerson
CHAIRMAN AND CEO, UNIVERSAL MUSIC PUBLISHING GROUP
Jody Gerson is Chairman and CEO of Universal Music Publishing Group (UMPG)
and a member of Universal Music Group’s (UMG’s) Executive Management
Board. One of the industry’s most respected and accomplished executives,
Gerson leads a global company with 48 offices in 40 countries and more than
850 employees. She made history as the first female chairman of a global
music company and the first woman to be named CEO of a major music publisher.
Since joining UMPG in 2015, Gerson has transformed the company into a global powerhouse
that ownes and administers more than 5 million copyrights and the industry's best global home
for songwriters.
A highly respected creative authority and thought leader in our culture, Gerson has signed and works
with the world’s biggest superstars, including Adele, Bee Gees, Bad Bunny, Justin Bieber, Sabrina
Carpenter, Lana Del Rey, Ariana Grande, Coldplay, Drake, Billie Eilish, H.E.R., Elton John, Alicia Keys,
Steve Lacy, Kendrick Lamar, Post Malone, Maren Morris, the Prince estate, Rosalia, Harry Styles, Taylor
Swift, SZA, The Weeknd, and more. She also led UMPG’s historic and highly competitive acquisitions of
the iconic catalogs of Bob Dylan, Neil Diamond, Sting, and others.
As a champion for women in music and advocate for education, Gerson cofounded the global
nonprofit She Is The Music. She also serves on boards for the USC Annenberg Inclusion Initiative, the
Rock & Roll Hall of Fame, the National Music Publishers Association, New Roads School, and Project
Heathy Minds.
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In January 2020, Gerson made history as the first woman and first music publishing executive to be
named
Billboard
’s ‘Executive of the Year’ for that outlet's most coveted Power 100 list, and annualy
ranks within that list's Top Ten. She is the recipient of numerous other prestigious honors, including
Billboard
's Power Players' Choice Award;
Variety
's Hitmakers Executive of the Year;
Billboard
's 2015
Executive of the Year for their Women In Music issue;
Rolling Stone
’s ‘Future 25’;
Variety
’s Power of
Women L.A.; the 2016 March of Dimes Inspiring Woman of the Year; and more.
Gerson jointly oversees Polygram Entertainment, a film and television development and production
division of UMG which produces award-winning feature-length films and music-centric series. In
2024 alone, she served as Executive Producer on a broad array of projects, including
Music Box: Yacht
Rock: A DOCKumentary
;
The Beach Boys
;
STAX: Soulsville, U.S.A.
; and
Billy Preston: That’s The Way God
Planned It
. Other recent projects that Gerson Executive Produced include
The Bee Gees: How Can
You Mend a Broken Heart
and HBO's
Music Box
series. Among her and Polygram’s many projects in
development are documentaries on Bernie Taupin and Prince.
Jeffrey Harleston
GENERAL COUNSEL AND EXECUTIVE VICE PRESIDENT OF BUSINESS AND
LEGAL AFFAIRS
Jeffrey Harleston is responsible for the global oversight of all business
transactions, contracts and litigation. He is additionally responsible for the
development of corporate policies, including the coordination of UMG’s
government relations, trade and anti-piracy activities, to ensure a unified
strategy across the Company’s divisions.
Harleston joined the Company in 1993 at MCA Records, after serving as Associate Independent
Counsel for the Iran Contra Investigation and prior to that as a Litigation Associate at Covington
& Burling LLP. Throughout his career, Harleston has been recognized for his many achievements
including receiving
The Recording Academy
’s 2020 Entertainment Law Initiative Service Award,
Billboard
’s 2018 ‘Lawyer of the Year’, the 2018 Diversity Award from the Association of Corporate
Counsel for Southern California. In 2017, Harleston was named one of
Ebony magazine
’s ‘Power 100’
and he is annually recognized by
Billboard
on the magazine’s ‘Power 100’ list of the most powerful
executives in the music industry.
Harleston is a Member of the Board of Trustees of Williams College and the Board of Harvard-
Westlake School. He also serves on the boards of the Recording Industry Association of America
the TJ Martell Foundation, MusiCares and the Motown Museum. Harleston is proud to be a Founder
of the Universal/Motown Fund, an endowment dedicated to providing financial assistance for artists
from the 50’s, 60’s and 70’s. He received a B.A. in Political Science from Williams College and a J.D.
from the University of California, Berkeley School of Law.
Eric Hutcherson
EXECUTIVE VICE PRESIDENT, CHIEF PEOPLE AND INCLUSION OFFICER
With a focus on people, culture and inclusion, Eric Hutcherson leads a
global team across UMG’s record labels, publishing division and operating
companies to align talent functions, amplify the Company’s entrepreneurial-
based culture, accelerate diversity and inclusion across all levels and
territories, attract, retain and develop talent, accelerate the Company’s social
justice initiatives and build on UMG’s successful track-record of driving innovation by recruiting
employees who bring new ideas, perspectives and skillsets.
Prior to joining UMG, he was EVP, Chief Human Resources Officer of the National Basketball
Association (NBA) where he managed a team that drove the NBA’s global workforce strategy.
Hutcherson currently serves as Vice-Chair of Covenant House International and Chair of the Human
Capital Committee, and on the Board of Councilors for the USC Annenberg School for Communication
and Journalism. Additionally, he serves as strategic advisor to the Board of Directors for the Young
People’s Chorus; a multicultural youth chorus whose mission is to provide children of all economic
and cultural backgrounds with a unique program of music education and choral performance.
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Hutcherson earned a bachelor’s degree in Political Science from New York University and a master’s
degree in Sports Management and Administration from the University of Massachusetts Amherst.
Boyd Muir
CHIEF OPERATING OFFICER (COO) AND CHIEF FINANCIAL OFFICER (CFO)
Boyd Muir is Chief Operating Officer (COO), and Chief Financial Officer (CFO) of
Universal Music Group (UMG). As COO, Muir is responsible for driving strategic
growth across the Company’s worldwide operations and has played a central
role in the physical-to-digital reshaping of Company resources, in addition
to leading its global financial operations, asset management, information
technology, accounting and supply chain.
Muir, who was appointed COO in October 2024, will continue to serve as CFO until his successor is
appointed. As UMG’s CFO, Muir played a key role in the Company’s successful listing on the Euronext
stock exchange in 2021. He has also been involved in a number of significant acquisitions, including
Sanctuary Group and V2 Music Group, as well as leading the Company’s successful acquisitions of
EMI, Ingrooves Music Group, [PIAS] and UMG’s minority investment in Chord Music Partners.
He was appointed as UMG’s EVP, CFO and President of Operations in 2010, having previously served
as CFO for Universal Music Group International, the division which manages UMG’s businesses in
more than 50 countries for more than a decade. From 1984 to 1991, Muir worked for Ernst & Young,
including at its entertainment media division in London, and for EMI from 1991 to 1994. At the latter
group, he was head of internal audit, spending considerable time working in Los Angeles and New
York. He was also closely involved in EMI’s acquisition of Virgin Music and Chrysalis Records.
Michael Nash
EXECUTIVE VICE PRESIDENT, CHIEF DIGITAL OFFICER
Michael Nash is Executive Vice President, Chief Digital Officer and oversees
UMG’s digital business development activities around the world. Nash has
worked at the forefront of media and technology convergence for his entire
career as an executive, entrepreneur and producer. Most recently, Nash
served as a strategic advisor to Warner Music Group (WMG), as well as several
digital media startups and new technology companies. Prior to that, he served as an executive at
WMG from 2000 to 2011, rising to the role of Executive Vice President of Digital Strategy and Business
Development where he oversaw WMG’s worldwide new media projects, strategic relationships and
business development activities.
Before joining WMG, Nash was the Executive Director of the Madison Project, the music industry’s
first digital distribution trial. From 1994 to 1997, Nash was founding CEO of Inscape, an interactive
entertainment and games publishing joint venture between WMG and HBO that produced titles with
artists such as William S. Burroughs, DEVO, Thomas Dolby and The Residents. Prior to that, Nash
served as Director of The Criterion Collection, working closely with directors and artists such as
Robert Altman, David Bowie, Terry Gilliam and Louis Malle.
Will Tanous
EXECUTIVE VICE PRESIDENT, CHIEF ADMINISTRATIVE OFFICER
Will Tanous plays a key role in the development of the Company’s business
strategy, overseeing several major strategic and corporate endeavors, as well
as managing worldwide external and internal communications, global public
policy, investor and government relations, event functions and global impact.
Prior to joining UMG in 2013, Tanous served as Executive Vice President of Communications &
Marketing for Warner Music Group (WMG) where he was central in all of the Company’s major
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corporate initiatives, including: the sale of WMG to Access Industries, Inc.; WMG’s initial public
offering on the New York Stock Exchange in 2005; and the sale of WMG by Time Warner Inc. to a
private equity consortium. In 2019, he was awarded the prestigious Ellis Island Medal of Honor,
which is presented annually to U.S. citizens “who have distinguished themselves within their own
ethnic groups while exemplifying the values of the American way of life.” He serves on the board
of the Recording Industry Association of America and is a graduate of Georgetown University in
Washington D.C.
Vincent Vallejo
DEPUTY CHIEF EXECUTIVE OFFICER, CORPORATE AND EXECUTIVE DIRECTOR
Based at the Company’s corporate headquarters in Hilversum, the
Netherlands, Vincent Vallejo is in the lead of a number of corporate initiatives
related to the Company’s listing on Euronext Amsterdam. Vallejo joined UMG
in 2021 and has worked closely across UMG matters ever since he joined
Vivendi in 1998, where he served most recently as SVP, Audit & Special
Projects. Prior to joining Vivendi, Vallejo held positions at AGF-ALLIANZ in France where he was
Deputy CFO and Ernst & Young in Paris and Madrid. He received an MBA from Montpellier University
and a Master of Science from Cornell-Essec, Cergy-Pontoise, France.
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BIOGRAPHIES OF THE BOARD OF DIRECTORS
Sir Lucian Grainge
Male, Age: 65, Nationality: British
CHAIRMAN AND CHIEF EXECUTIVE OFFICER AND EXECUTIVE DIRECTOR
Sir Lucian Grainge has spent his entire career in the music industry and has signed and worked
with many worldwide stars, including ABBA, Jay Z, Elton John, Katy Perry, Queen, Rihanna, The Rolling
Stones, Sam Smith, U2 and Amy Winehouse, among many others.
During the span of four decades, he not only pioneered new approaches to the signing and
development of the world’s most successful recording artists and songwriters, he also consistently
championed the development of innovative business models and partnerships with a wide range
of technology and media partners around the world. He has transformed Universal Music Group
(UMG) into the most successful company in the history of the music industry, both competitively and
financially, and his vision and leadership is widely recognized as having returned the entire industry
to growth after years of decline. In 2011, he led UMG’s successful acquisition of the recorded music
assets of the legendary British music company EMI, revitalizing its iconic Capitol Records, and, in the
process, further strengthening UMG’s position as the global leader in music.
A native of London, Sir Lucian was bestowed with a knighthood in 2016 by Her Majesty Queen
Elizabeth II in the Queen’s 90th Birthday Honours list for accomplishments in the music industry
and leadership through its challenging times, contributions to British business and inward
investment, as well as his development of innovative business models, technology and media
partnerships that have expanded UMG’s global presence.
Vincent Vallejo
Male, Age: 64, Nationality: French
DEPUTY CHIEF EXECUTIVE OFFICER, CORPORATE AND EXECUTIVE DIRECTOR
Based at the Company’s corporate headquarters in Hilversum, the Netherlands, Vincent Vallejo
is in the lead of a number of corporate initiatives related to the Company’s listing on Euronext
Amsterdam. Vallejo joined UMG in 2021 and has worked closely across UMG matters ever since he
joined Vivendi in 1998, where he served most recently as SVP, Audit & Special Projects. Prior to joining
Vivendi, Vallejo held positions at AGF-ALLIANZ in France where he was Deputy CFO and Ernst & Young
in Paris and Madrid. He received an MBA from Montpellier University and a Master of Science from
Cornell-Essec, Cergy-Pontoise, France.
Sherry Lansing
Female, Age: 80, Nationality: American
CHAIRMAN OF THE BOARD AND NON-EXECUTIVE DIRECTOR
Sherry Lansing is the founder and CEO of The Sherry Lansing Foundation, an organization dedicated
to funding and raising awareness for cancer research, health, public education, and encore career
opportunities. Lansing has extensive knowledge of the creative industries, including but not limited
to audio and visual content. During a nearly 30-year career in the motion picture business, Lansing
was involved in the production, marketing, and distribution of more than 200 films, including
Academy Award winners Forrest Gump, Braveheart, and Titanic. In 1980, she became the first woman
to head a major film studio when she was appointed President of 20th Century Fox. Later, as
an independent producer, she was responsible for such successful films as Fatal Attraction, The
Accused, School Ties, Indecent Proposal, and Black Rain. Returning to the executive ranks in 1992,
Lansing was named Chairman and CEO of Paramount Pictures and began an unprecedented tenure
that lasted more than 12 years. Lansing graduated cum laude with a Bachelor of Science Degree from
Northwestern University in 1966.
Margaret Frerejean-Taittinger
Female, Age: 39, Nationality: American
VICE-CHAIRMAN OF THE BOARD AND NON-EXECUTIVE DIRECTOR
Margaret Frerejean-Taittinger is the co-founder of French Bloom, a company that specializes in
organic alcohol-free sparkling wines. Serving as Chief Marketing Officer, Frerejean-Taittinger has
successfully positioned French Bloom as the market leader of the super-premium 0.0% category
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with presence in more than 35 markets. Previously, she served as International Development
Manager for the Michelin Guide, the renowned restaurant rating system that publishes its yearly
selections in over 35 countries. In this role, Frerejean-Taittinger led the expansion of the Michelin
Guide working towards doubling its international footprint over a period of five years. Prior to
Michelin, she served as the Director of Communications and Marketing for Laboratories Surface-
Paris, a beauty company that specializes in cosmeceutical skincare. Frerejean-Taittinger also spent
eight years in the international development field, addressing cross-sector challenges to sustainable
development with a focus on education and micro-finance in East Africa. Frerejean-Taittinger holds
a Master of Development Practice from l’Institut d'Études Politiques de Paris (Sciences Po), where she
graduated summa cum laude.
Bill Ackman
Male, Age: 58, Nationality: American
NON-EXECUTIVE DIRECTOR
Bill Ackman is the CEO of Pershing Square Capital Management, L.P., an investment firm he
founded in 2003, and Chairman and CEO of Pershing Square SPARC Holdings, Ltd., a special purpose
acquisition rights company. He serves as a member of the Investor Advisory Committee on Financial
Markets for the Federal Reserve Bank of New York, and as a member of the Board of Dean’s Advisors
of the Harvard Business School. He served as Chairman of Howard Hughes Holdings Inc. (NYSE:
HHH) from November 2010 to May 2024, and as Chairman and CEO of Pershing Square Tontine
Holdings, Ltd. (NYSE: PSTH) from July 2020 to July 2022. Ackman is co-trustee of the Pershing Square
Foundation, a family foundation. Ackman received an MBA from the Harvard Business School and a
Bachelor of Arts magna cum laude from Harvard College.
Cathia Lawson-Hall
Female, Age: 53, Nationality: French and Togolese
NON-EXECUTIVE DIRECTOR
Cathia Lawson-Hall has over 25 years' experience in the financial sector. She was Head of Coverage
and Investment Banking for Africa at Société Générale, in charge of the overall relationship and
strategic advisory with governments, large corporates and financial institutions in Africa. Previously,
she served as Managing Director, Co-Head of Debt Capital Markets for corporates in France, Belgium
and Luxembourg. Lawson-Hall is also a member of the Board of Directors of Vivendi SE, Havas
N.V., Endeavour Mining Plc and Eurazeo. She sits on the board of directors of 'Amis du Centre
Pompidou', the first patrons of the museum who contribute to the enrichment of the collections of
the institution. Lawson-Hall was one of six recipients, alongside the Mayor of London, Sadiq Khan, of
a Diversity Award in 2017 awarded by the think tank "Club XXIe-Siècle" in the "Career path" category.
In 2015, Lawson-Hall was voted Manager of the Year at the sixth edition of La Tribune Women's
Awards. Lawson-Hall holds a Master’s degree and a postgraduate degree in Finance from Paris
Dauphine University.
Cyrille Bolloré
Male, Age: 39, Nationality: French
NON-EXECUTIVE DIRECTOR
Cyrille Bolloré serves as the Chairman and Chief Executive Officer of Bolloré Group, a family-
controlled holding company which is among UMG’s largest investors and among the 500 largest
companies in the world with focused investments in oil logistics, communication, and industrial
activities including ultra-thin films and electricity storage and solutions. At Bolloré Group, he
additionally serves as Chairman of the Board of Directors of Bolloré Energy, Chairman of the
Supervisory Board of Sofibol, Chairman of the Management Board of Compagnie du Cambodge,
and Vice-Chairman of Compagnie de l’Odet, as a Director of Bolloré Participations SE, Financière V,
Omnium Bolloré, Société Industrielle et Financière de l’Artois, Financière du Champ de Mars, SFA SA,
Nord Sumatra Investissements, and Plantations des Terres Rouges, as a permanent representative
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on the Boards of Financière Moncey, and as a member of the Supervisory Board of JCDecaux Bolloré
Holding. In addition, Bolloré serves as a director on the boards of several prominent companies,
including on the Supervisory Board of Vivendi SE, and also serves on the Board of Socfinasia and
Socfin, and as a permanent representative on the Board of Socfinaf. Bolloré is a graduate of Paris
Dauphine University, and holds a Master’s degree in Economics and Management, with a major
in Finance.
Eric Sprunk
Male, Age 61, Nationality: American
NON-EXECUTIVE DIRECTOR
Eric Sprunk is a global consumer-retail industry leader with more than 25 years’ experience
delivering outstanding financial results, creating shareholder value and building loyal, high-
performance teams. He most recently served as the Chief Operating Officer of Nike from 2013
to 2020, where he led a globally distributed team of 25,000+ Nike employees and an additional
1,200,000 contract employees responsible for its robust and innovative global supply chain, demand/
supply planning, procurement, corporate real estate and workplaces and IT/technology for the
global enterprise. During his 27 years at Nike, he held various executive positions of increasing
responsibility, including EVP, Global Product & Merchandising from 2008 to 2013 and EVP & GM,
Global Footwear from 2001 to 2008. As COO, he drove the digital transformation of the company
to be consumer direct. He currently serves as a member of the Board of Directors of General
Mills, Bombardier and Nordstrom. Sprunk has a Bachelor’s degree in Business Administration and
Accounting from the University of Montana.
Haim Saban
Male, Age 80, Nationality: American and Israeli
NON-EXECUTIVE DIRECTOR
Haim Saban is an entrepreneur with more than four decades of experience building successful
media and telecommunication businesses. He is the Chairman and CEO of Saban Capital LLC, a
private Los Angeles-based investment firm that spans operations in real estate, venture capital,
film and music. In partnership with News Corp. and Rupert Murdoch, Saban co-founded Fox
Family Worldwide in 1996, creating a global television, broadcasting, production, distribution and
merchandising company. In 2001, Walt Disney Co. acquired Fox Family for an enterprise value of
USD 5.3 billion. Saban founded Saban Capital Group (SCG) and led an investor group in 2003 to buy
a controlling stake in ProSiebenSat.1 Media, Germany’s largest broadcaster. He served as Chairman
of its Supervisory Board and in 2007 oversaw the sale of the controlling stake to KKR and Permira
at a USD 7.5 billion valuation, representing five times the initial investment. In 2005, SCG and Apax
Partners acquired a controlling stake in Bezeq, Israel’s largest telecom company, which they sold to
Eurocom Group at a valuation of more than four-and-a-half times the initial investment five years
later. SCG led the acquisition in 2007 of Univision Communications, the leading Spanish-language
media company in the U.S. for which Saban served as Chairman. SCG continues to make minority and
controlling investments in early stage private and public companies, including Epic Games, Keshet,
Kite Pharma and Roblox, among others; feature film projects through Saban Films; and private equity
investments in companies, including Celestial Tiger.
James Mitchell
Male, Age: 51, Nationality: British
NON-EXECUTIVE DIRECTOR
James Mitchell is a Senior Executive Vice President and Chief Strategy Officer of Tencent Holdings
Limited (HKEX: 0700), where he has worked since July 2011. He is a director of certain listed
companies including Frontier Developments Plc (AIM: FDEV) and Tencent Music Entertainment Group
(NYSE: TME, HKEX: 1698), and of various unlisted companies. He was previously Chairman and Non-
Executive Director of the Board of China Literature Limited (HKEX: 0772). Prior to joining Tencent,
Mitchell was a Managing Director at Goldman Sachs. Mitchell received a Bachelor of Arts degree from
Oxford University and holds a Chartered Financial Analyst certification.
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Luc Van Os
Male, Age: 58, Nationality: Dutch
NON-EXECUTIVE DIRECTOR
Luc van Os is co-owner of Misset Uitgeverij, a B2B publisher of multi-media brands for the
agricultural sector, and of Rendement Uitgeverij, a B2B multi-media publisher specialized in HR,
fiscal and salary information. Previously, he served for 12 years as CEO of Hearst Netherlands and its
predecessors, home to titles including Harper’s Bazaar, Elle, Quote and Cosmopolitan. Prior to serving
as CEO, he held different leadership roles at Hearst and its predecessors, Hachette Filipacchi Media
and Quote Media. Under his leadership, Hearst became the largest upscale magazine publisher
in the Netherlands. Van Os is also a member of the Supervisory Board of VNO-NCW, the national
employers association in the Netherlands.
Mandy Ginsberg
Female, Age: 55, Nationality: American
NON-EXECUTIVE DIRECTOR
Mandy Ginsberg is an operating partner at Advent International, one of the largest global private
equity investment firms. An accomplished leader with extensive online consumer acumen, Ginsberg
played various roles over fourteen years at Interactive Corp and Match Group, a portfolio of industry
leading digital dating platforms. She served as CEO of Match Group Americas from 2016 to 2018
and ultimately served as CEO of the publicly listed entity Match Group from 2018 to 2020 leading
its 45 global dating companies, including Tinder, Match.com, OkCupid, and Hinge. As CEO of Match
Group, she drove a period of tremendous subscriber and revenue growth and more than doubled
the company’s enterprise value. During her tenure, she led the company’s expansion in North
America and overseas, both through organic growth and acquisitions, including the 2018 purchase
of relationship-focused platform Hinge. Ginsberg has held roles within the IAC portfolio of digital
companies since 2006. This includes tenures as an EdTech CEO of both The Princeton Review and
Tutor.com from 2013 to 2015 and CEO of Match.com North America from 2008 to 2012. She currently
serves on the Board of Directors at Uber Technologies and ThredUp, and previously served as a
director at Match Group, J.C. Penney Company and Care.com. Ginsberg holds an MBA from The
Wharton School of the University of Pennsylvania and a BA from the University of California, Berkeley.
Nicole Avant
Female, Age: 57, Nationality: American
NON-EXECUTIVE DIRECTOR
Nicole Avant is the best-selling author of “Think You’ll Be Happy - Moving Through Grief with
Grit, Grace and Gratitude”. She served as the 13th U. S. Ambassador to The Bahamas after being
nominated by President Barack Obama and unanimously confirmed by the U. S. Senate, becoming
the youngest as well as the first African American woman to hold the position. In addition to her
international diplomatic work, Ambassador Avant brings deep commercial insight and knowledge of
the media and entertainment industries having worked in the music business for over 25 years and
serving as Vice President of Interior Music Publishing, founded by her father, entertainment mogul,
Clarence Avant. Ambassador Avant currently focuses her efforts in film and television production
and has produced the critically acclaimed and award winning films “The Black Godfather” and
“Trees of Peace”. Ambassador Avant also serves on the Board of Soho House & Co, Inc. Throughout
her career, Ambassador Avant has also pursued an array of business and philanthropic ventures.
Ambassador Avant graduated with a Bachelor of Arts degree in Communications from California State
University, Northridge.
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DEFINITIONS
In this Annual Report release, UMG presents certain financial measures when discussing UMG’s
performance that are not measures of financial performance or liquidity under IFRS (“non-IFRS”).
These non-IFRS measures (also known as alternative performance indicators) are presented because
management considers them important supplemental measures of UMG’s performance and believes
that they are widely used in the industry in which UMG operates as a means of evaluating a
company’s operating performance and liquidity. UMG believes that an understanding of its sales
performance, profitability, financial strength and funding requirements is enhanced by reporting
the following non-IFRS measures. All non-IFRS measures should be considered in addition to, and
not as a substitute for, other IFRS measures of operating and financial performance as presented
in UMG’s Consolidated Financial Statements and the related Notes. In addition, it should be noted
that other companies may have definitions and calculations for these non-IFRS measures that differ
from those used by UMG, thereby affecting comparability.
EBITDA and EBITDA margin
UMG considers EBITDA and EBITDA margin, non-IFRS measures, to be relevant measures to assess its
operating performance and the performance of its operating segments as reported in the segment
data. It enables UMG to compare the operating performance of operating segments regardless of
whether their performance is driven by the operating segment’s organic growth or by acquisitions. It
excludes restructuring expenses, which may impact period-to-period comparability. EBITDA margin
is EBITDA divided by revenue.
To calculate EBITDA, the accounting impact of the following items are excluded from Operating Profit:
1.
amortization of intangible assets;
2.
impairment on goodwill and other intangibles;
3.
depreciation of tangible assets including right of use assets;
4.
(gains)/losses on the sale of tangible assets, including right of use assets and intangible
assets; and
5.
restructuring expenses.
Adjusted EBITDA and Adjusted EBITDA margin
The difference between EBITDA and Adjusted EBITDA consists of non-cash share-based
compensation expenses and certain one-time items when applicable, that are deemed by
management to be significant and incidental to normal business activity. Adjusted EBITDA margin is
Adjusted EBITDA divided by revenue.
UMG considers Adjusted EBITDA and Adjusted EBITDA margin, non-IFRS measures, to be relevant
measures to assess performance of its operating activities excluding items that may be incidental
to normal business activity and excluding non-cash share based compensation which may impact
period-to-period comparability.
Adjusted Net Profit/Adjusted Net Profit per share
UMG's use of Adjusted net profit is appropriate as UMG uses it as the basis for the Adjusted net profit
per share (in EUR) – diluted, both of which are non-IFRS measures. Adjusted net profit may be subject
to limitations as an analytical tool for investors, as it excludes certain items and therefore does not
reflect the expense associated with such items, which may be significant and have a significant
effect on UMG’s net profit. During 2024, UMG updated the definition of Adjusted net profit to exclude
restructuring expenses which may impact period-to-period comparability.
The accounting impact of the following items are excluded from Net profit attributable to equity
holders of the parent:
1.
amortization of catalogues;
2.
impairment of goodwill and intangible assets;
3.
financial income and expenses, excluding interest and income from investments;
4.
restructuring expenses;
5.
earnings from discontinued operations;
6.
non-cash share-based compensation expense;
7.
certain one-time items that are deemed by management to be significant and incidental to
normal business activity;
8.
income tax impact on the above adjustments;
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9.
non-recurring tax items; and
10.
adjustments attributable to non-controlling interests.
Financial Net Debt
UMG considers Financial Net Debt, a non-IFRS measure, to be a relevant indicator of the group’s
liquidity and capital resources. UMG management uses this indicator for reporting, management and
planning purposes. Financial Net Debt is calculated as the sum of:
1.
cash and cash equivalents, as reported in the Consolidated Statement of Financial Position,
including (i) cash in banks and deposits, whether or not compensated, corresponding to cash,
and (ii) money market funds;
2.
cash management financial assets, included in the Consolidated Statement of Financial Position
under “financial assets”, relating to financial investments, which do not satisfy the criteria for
classification as cash equivalents set forth in IAS 7;
3.
derivative financial instruments, net (assets and liabilities) where the underlying instruments
are Financial Net Debt items, as well as cash deposits securing borrowings included in the
Consolidated Statement of Financial Position under “financial assets”;
less:
1.
the value of borrowings at amortized cost as reported in the Consolidated Statement of
Financial Position.
Free Cash Flow
UMG defines Free Cash Flow as net cash provided by/(used for) operating activities plus net cash
provided by/(used for) investing activities, less repayment of lease liabilities, interest paid, net and
other cash items related to financing activities. UMG considers Free Cash Flow, a non-IFRS measure,
to be a relevant indicator of its cash flow generated to fund dividend payments and repayment
of debt. Free Cash Flow is not a measure of performance calculated in accordance with IFRS and
therefore it should not be considered in isolation of, or as a substitute for cash flow provided
by operating activities as a measure of liquidity. Free Cash Flow, as we calculate it, may not be
comparable to similarly titled measures employed by other companies. In addition, Free Cash
Flow does not necessarily represent funds available for discretionary use and is not necessarily
a measure of our ability to fund our cash needs.
Reconciliation of net profit attributable to equity holders of the parent to adjusted
net profit
Year ended,
December 31
(millions of euros)
2024 2023
Net profit attributable to equity holders of the parent
1
2,086 1,259
Financial income and expenses, excluding interest and income from investments (1,177) (377)
Non-cash share-based compensation expense 329 561
Restructuring expense 169 41
Impairment of intangible assets 2 (7)
Amortization of catalogues 245 236
Income tax on adjustments 128 (87)
Adjusted Net Profit
2
1,782 1,626
1 As reported in the Consolidated Statement of Profit or Loss
2 Following a change in the definition, the FY23 Adjusted Net Profit has been restated to exclude the impacts of
restructuring expenses and related tax impacts.
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Adjusted net profit per share
Year ended December 31,
(millions of euros)
2024 2023
basic diluted basic diluted
Adjusted net profit
1
1,782 1,782 1,626 1,626
Number of shares
2
Weighted average number of shares outstanding 1,827 1,827 1,819 1,819
Potential dilutive effects related to
sharebased compensation
- 25 - 23
Adjusted weighted average number of shares
1,827 1,852 1,819 1,842
Adjusted net profit per share (in euros)
0.98 0.96 0.89 0.88
1 Following a change in the definition, the FY23 Adjusted Net Profit has been restated to exclude the impacts of
restructuring expenses and related tax impacts.
2 As reported in Note 8 of the Consolidated Financial Statements.
Net cash provided by operating activities - Adjustments
Operating profit includes certain non-cash items that are adjusted to get to the Net cash provided by
operating activities as follows:
Year ended,
December 31
(millions of euros)
2024 2023
Amortization and depreciation expense 409 382
Non-cash share-based compensation expense, net of employees tax withheld 131 429
Impairment (reversal)/charge of intangible assets 2 (7)
Changes in provisions, net 1 18
(Gain)/loss on sale of assets (23) (26)
Adjustments
520 796
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CAUTIONARY NOTICE
Forward-looking statements
This Annual Report may contain statements that constitute forward-looking statements relating to
UMG’s financial condition, results of operations, business, strategy and plans, and the industry in
which UMG operates. Such forward-looking statements may be identified by the use of words such as
‘profit forecast’, ‘expect’, ‘estimate’, ‘project’, ‘anticipate’, ‘should’, ‘intend’, ‘plan’, ‘probability’, ‘risk’,
‘target’, ‘aspiration’, ‘objective’, ‘will’, ‘endeavour’, ‘optimistic’, ‘prospects’ and similar expressions
or variations on such expressions or the negative of such expressions, or by the forward-looking
nature of discussions, or by context. Although UMG believes that such forward-looking statements
are based on reasonable assumptions, they are not guarantees of future performance. Actual results
may differ materially from such forward-looking statements as a result of a number of risks and
uncertainties, many of which are related to factors that are outside UMG’s control, including, but not
limited to, UMG’s inability to compete successfully and to identify, attract, sign and retain successful
recording artists and songwriters, failure of streaming and subscription adoption or revenue to
grow or to grow less rapidly than anticipated, UMG’s reliance on digital service providers, UMG’s
inability to execute its business strategy, the global nature of UMG’s operations, changes in global
economic and financial conditions, UMG’s inability to protect its intellectual property and against
piracy, challenges related to generative AI, UMG’s inability to attract and retain key personnel, UMG’s
restructuring and reorganization activities, UMG’s acquisitions and other investments, changes in
laws and regulations (and UMG’s compliance therewith), UMG’s inability to meet expectations with
respect to ESG-related matters and the other risks described in this Annual Report. Accordingly, UMG
cautions readers against placing undue reliance on such forward-looking statements. Such forward-
looking statements are made as of the date of this Annual Report. UMG disclaims any intention or
obligation to provide, update or revise any such forward-looking statements, whether as a result of
new information, future events or otherwise.
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