RLJ Lodging Trust : Corporate Sustainability Report 2023

2023 CORPORATE SUSTAINABILITY REPORT

ABOUT THIS REPORT

This is RLJ's second annual Corporate Sustainability Report. It covers all Environmental, Social, and Governance (ESG) matters in the

2022 fiscal year and is limited to the hotels that RLJ wholly owned for all twelve months of the year. Additionally, this report discloses historical environment performance data to track progress towards our commitment to lowering our carbon footprint.

CSR Report 2023

INTRODUCTION	1	Case Study - Waste Management
About This Report	1	Efficiency Study	23
To Our Stakeholders	2	Waste	24
Company Overview	4	Property-Level Best Practices	24
2022 Portfolio	4	Case Study - Clean the
Core Pillars of Our Business Strategy	5	World Partner	25
ESG Highlights	6
ESG Approach	7	SOCIAL
		RESPONSIBILITY	26
ESG GOVERNANCE		Diversity and Inclusion	27
AND OVERSIGHT	9	Health and Well-Being	28
Governance Strategy	10	Case Study - Habitat for
Corporate Governance	11	Humanity 2022 Build Day	29
Risk Management	12	Responsible Labor Practices	30
Enterprise Risk Management	12	Community Engagement
Environmental Risk Management	13	and Philanthropy	30
Cyber Risk Management	13	Case Study - Industrial Bank	31
Stakeholder Engagement	14
		ROADMAP
ENVIRONMENTAL		BEYOND 2023	32
SUSTAINABILITY	15
Environmental Strategy	16	APPENDIX	33
Climate Change	17
Case Study - Hurricane
Ian Response	18
TCFD Overview	19
Energy and Water
Efficiency Investments	19
Case Study - Water Stations	20
Environmental Performance	21

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CSR Report 2023

Corporate Responsibility is integral to our overall business strategy and commitment to driving long-term value for all stakeholders.

With respect to social responsibility, RLJ has continued to uphold the leadership mantle with respect to diversity and inclusion, as one of the most diverse organizations in our industry. Today, 49% of our associates and 33% of our Board are women, and over half of our associates and Board members are from ethnically diverse backgrounds, underscoring our steadfast commitment to inclusivity, which has been embedded in RLJ since its beginning. We made further strides in 2022, by joining as a founding donor for NAREIT's Dividends through Diversity Equity and Inclusion grant program, to help foster and grow diversity within the industry.

To Our Stakeholders,

Throughout this past year, the lodging industry once again demonstrated its resiliency by achieving positive momentum across multiple metrics. As our industry moves beyond the impact of the pandemic, we are continuing to build upon our track record of sound corporate responsibility and stewardship. To this end, I am proud to share RLJ's second Corporate Sustainability Report (CSR) which showcases the work our team has done to further our Environmental, Social, and Governance (ESG) program on all fronts. This report encompasses the progress we made on our ESG initiatives in 2022 and also introduces initiatives we began in 2023. Notably, this report includes comprehensive portfolio-wide,property-level data for the first time, showcasing the commendable strides our hotel associates have made in fulfilling our sustainability objectives. As we make progress, we are increasingly coordinating our corporate sustainability efforts with our third-party managers, industry associations, and brands such as Marriott, Hilton, and Hyatt who remain at the forefront of leading sustainability practices in our industry.

Leslie D. Hale, President and CEO

Acknowledging the importance of ESG to our stakeholders, in 2022 we strengthened our corporate governance by formalizing the oversight of our ESG program as one of the Board responsibilities, delegating oversight of all ESG initiatives to the Nominating and Corporate Governance Committee (NCGC). This new responsibility

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CSR Report 2023

empowers the committee to regularly review progress and updates from the RLJ team and provide their recommendations, thereby enhancing RLJ's responsiveness to evolving sustainable business practices. Moreover, we also introduced ESG compensation goals for senior executives, which have aligned financial incentives with our sustainability objectives.

We remain steadfast in our belief that the sustainability of both our industry and enterprise are closely linked to upholding environmental stewardship. In 2022, we demonstrated our commitment to sustainability by investing $6.6 million across 200+ projects at 81 of our hotels, with approximately 76% of these projects focused on energy or water efficiency. Our in-house design and construction team, a unique feature of RLJ, actively seeks out and prioritizes opportunities where we can advance sustainability initiatives that also help us meet our business goals. For example, as part of our recent conversions, we upgraded and installed equipment that is less energy intensive, which in addition to reducing our overall carbon footprint, will also provide cost savings over their useful lives. Our sustainability efforts were also evident at our recent conversion - The Pierside in Santa Monica, CA - which earned recognition under the EPA's EnergyStar program as a certified hotel. As it relates to waste reduction, we recognize the importance of minimizing waste to reduce the environmental impact of our properties. To this end, we have partnered with an innovative waste management provider for several of our assets in Washington, D.C., to gather insights into our waste management practices and bolster our waste reduction strategies. Through this new partnership we were able to both enhance the understanding of our waste data and also save costs through better waste management practices. Based on the initial success, we are already implementing this initiative at several of our other properties.

At the forefront of all our corporate sustainability efforts are our associates, who remain at the heart of RLJ. Ensuring their wellbeing remains a high priority for us. As we emerged from the pandemic and settled into a hybrid environment, we have worked hard to enhance associate engagement and morale through in-person events, such as monthly lunches, alumni roundtables, and welcoming the team to our new, LEED Platinum Certified corporate headquarters. Our associates have also donated countless hours in support of organizations such as Habitat for Humanity and Don Bosco Cristo Rey, benefitting the communities in which we operate. We further complimented these volunteer hours with charitable giving in aggregate of over $220,000, thereby further extending the positive impact of our charitable efforts.

Overall, I am excited to share this CSR, which underscores our commitment to progress and accountability in ESG matters. In support of continuing accountability, our CSR aligns with the Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), and Task Force on Climate-Related Financial Disclosures (TCFD). We also remain committed to reducing our carbon emission by 35% by 2030. This report not only celebrates our accomplishments towards upholding our corporate responsibility, but also serves as a roadmap for our continuing journey towards sustainably operating our business, which will create lasting value for our stakeholders.

I extend my appreciation to all our stakeholders, especially our associates, for their support on this remarkable journey.

LESLIE D. HALE, PRESIDENT AND CEO

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CSR Report 2023

RLJ Lodging Trust is one of the largest U.S. publicly-traded lodging real estate investment trusts (REITs) in terms of both number of hotels and number of rooms. We seek to generate strong returns long term for our shareholders by acquiring, owning, and operating primarily primarily premium-branded, rooms- oriented, high margin hotels in markets that exhibit multiple demand generators and attractive long-term growth prospects.

2022 PORTFOLIO

AS OF DECEMBER 31, 2022

96

HOTELS & RESORTS

23

STATES & TERRITORIES

21.2K

ROOMS

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CORE PILLARS OF OUR BUSINESS STRATEGY

CSR Report 2023

DISCIPLINED HOTEL ACQUISITION

We seek to acquire hotel properties at prices where we believe we can enhance value by pursuing proactive investment strategies such as renovation, repositioning, or rebranding.

PROACTIVE ASSET MANAGEMENT

To enhance quality and attractiveness, increase long-term value, and generate attractive returns on investment, we actively monitor and advise our third-party management companies on key aspects of our hotels' operations, including property positioning, physical design, capital planning and investment, guest experience, and overall strategic direction.

A STRONG AND FLEXIBLE BALANCE SHEET

A strong balance sheet is a key competitive advantage that affords us a lower cost of capital and positions us for growth. We structure our debt profile to maintain financial flexibility and a balanced maturity schedule with access to different forms of financing.

DIVERSITY AND INCLUSION

Diversity and inclusion has been a pillar of RLJ since its inception and is part of our Company's DNA. Our culture and practice of diversity and inclusivity boosts motivation, brings new thoughts and ideas to our business, attracts top talent, and helps to retain associates.

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CSR Report 2023

ESG HIGHLIGHTS

62%

PROPERTIES

have installed bulk dispensers or non-plastic alternatives to replace mini toiletries

100%

PROPERTIES

have undergone

an energy-efficiency assessment in the past three years

35

PROPERTIES

TripAdvisors

Green Leaders Program

49% 54%

Women Ethnically Diverse

7 OF 9	independentare
TRUSTEES

5-Star

PROMISE

Responsible Stay Signatory

NOMINEES 33%	56%
TRUSTEE
Women	Ethnically Diverse

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CSR Report 2023

ESG APPROACH

As we operate our business, we are committed to fostering diversity and inclusivity in the workplace, demonstrating high ethical standards in the management of our business, and managing our portfolio to reduce climate and other risks along with minimizing our environmental impact. We recognize the importance of ESG to our investors and stakeholders and have strengthened our approach by establishing an internal ESG committee that reports ESG matters directly through our CEO to the Board's Nominating and Corporate Governance Committee.

Board of Directors

Nominating and Corporate

Governance Committee

Chief Executive Officer

ESG Committee

Asset

Design and

Human

Investor

Portfolio

Risk

Accounting/

Relations

Information

Management

Construction

Resources

Investments

Management

and Finance

Technology

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CSR Report 2023

ESG APPROACH

Our corporate responsibility strategy underpins our commitment to ESG, and we continue to integrate our strategy to create long-term shareholder value, while maintaining the highest standards of ethical behavior and effective corporate governance. We also commit to environmental stewardship by investing in projects that reduce our consumption of energy and water and lower our greenhouse gas emissions. Additionally, we strive to generate positive social impact by empowering our associates and supporting our local communities through philanthropy and other community engagement activities.

We formalize our longstanding commitment to greater sustainability through policies which guide our actions. Links to these policies can be found in the Appendix.

Our sustainability strategy aligns our ESG objectives with our commitment to generating long-term shareholder value and alignment to the UN Sustainable Development Goals (UN SDGs) through the following:

D R I V E

DRIVE

revenue growth by following a disciplined investment strategy and through robust asset management (SDG 8)

REDUCE

costs and support green growth through investments in energy and water conservation and other sustainability efforts (SDG 6, SDG 7)

IMPROVE	VALIDATE	EXPAND
our human capital	our sustainability	our engagement with
by championing our	commitments through	our partners, suppliers,
corporate culture of	external benchmarking	and the communities in
diversity and inclusivity,	and transparent	which we operate (SDG 17)
to boost motivation,	reporting (SDG 12)
attract top talent, and
retain associates (SDG 3,
SDG 4, SDG 5, SDG 10)		8

CSR Report 2023

ESG GOVERNANCE AND OVERSIGHT