UPM Annual Report 2024

WE ARE UPM

GOVERNANCE

ACCOUNTS AND PERFORMANCE

Report of the Board of Directors

Sustainability Statement

Financial Statements

Auditor's Report

Sustainability Assurance Reports

INTEREST AND VIEWS OF STAKEHOLDERS

IMPACTS, RISKS AND OPPORTUNITIES Material impacts, risks and opportunities

The views and feedback from the stakeholder dialogue are taken into consideration in the double materiality assessment to further evaluate material sustainability topics. Every year, this materiality analysis is carried out to identify the topics on which UPM has a significant impact, or which have a significant impact on the Company. The analysis is based on internal assessments, as well as stakeholder interests and concerns. The annual double materiality assessment also takes the interests, views and rights of UPM's workforce, value chain workers and affected communities into account. The identified material topics are reviewed by the Group Executive Team, and further action is taken if considered relevant. Measures for UPM's own workforce include the annual UPM Employee Engagement Survey (EES), which invites all employees across the Company to evaluate various aspects of their working environment. » See S1-2 Processes for more information about EES. For example, UPM and NGOs may have different views on how to address climate change and biodiversity loss, but the goal is the same. UPM believes that active and timely forest management maintains carbon sinks and ensures the enhancement of biodiversity, while society needs to reduce its dependence on fossil fuels and raw materials. UPM responds to stakeholders' concerns at local, national and international levels, participates in public debate, and meets with NGO representatives. In general, human rights considerations and due diligence requirements are integrated into UPM's global processes, which form the basis for UPM's business model. The Board is informed through the Audit Committee Chair's regular reporting to the Board when the Audit Committee receives information about stakeholders' views and interests that have an actual or potential material impact on sustainability. The Audit Committee oversees risk management and compliance and receives regular updates on these matters.

SBM-2

needs. Key stakeholders are defined based on materiality: UPM's operations have a significant impact on stakeholders and vice versa. The stakeholder relations are led and coordinated globally by the UPM Marketing, Sustainability and Communications function. The EVP of the aforementioned function has the overall responsibility for the stakeholder engagement processes and development, supported by the Responsibility Team at the Group level. The function includes the same responsibility at the business level, where the VP of the function is responsible for the stakeholder engagement and continuous dialogue with customers and business partners, as well as local communities within and in the context of their business area. This ensures proactive and relevant engagement across the business and geographical spectrum.

Understanding the views and expectations of stakeholders plays a crucial role in UPM's success and the acceptance of its operations. UPM aims to give stakeholders a clear picture of the future direction, how UPM's strategy is implemented, and how long-term value is created for stakeholders. UPM discloses relevant and accurate information in accordance with market regulations. Because many stakeholders see UPM primarily as an economic operator, financial success, stability, good governance, future outlook and growth were the main topics of discussion. Many discussions also focused on forests and forest use. Stakeholder mapping, active dialogue and the systematic collection of feedback play an important role in UPM's stakeholder relations work. Feedback is carefully analysed to understand stakeholder expectations. These expectations are taken into account in development work and decision-making. UPM's strategy forms the foundation of UPM's stakeholder dialogue. Focus areas and activities vary locally and according to stakeholder

SBM-3

UPM's sustainable impact, risk and opportunity identification is based on continuous business processes and stakeholder engagement. UPM continuously assesses new opportunities, risks and impacts to achieve its strategic business objectives. As part of the double materiality assessment, UPM has formalised the identification of impacts, risks and opportunities in accordance with the ESRS requirements. All identified material impacts, risks and opportunities are covered by the ESRS Disclosure Requirements. Disclosure of ESRS S4 Consumers and end-users is not considered material for UPM, as UPM does not sell directly to consumers. UPM's products are mainly used as raw materials and intermediate products, and UPM has no visibility to end-users of the final products. While UPM does have businesses that produce final products, such as UPM Biomedicals, they are not considered material in the context of the overall UPM Group. » Refer to ESRS 2 BP-1 Coverage of the value chain The table on the next page provides an overview of the material topics identified.

UPM's most important stakeholders

The Company uses multiple ways to embed the views and insights gained through the stakeholder engagements into its business decisions and strategy. These methods include but are not limited to regular interviews

and surveys, open dialogue and engagement events. It is the responsibility of the function representatives to turn the views into insights that help develop the business, its performance and future strategy.

UPM FINANCIAL REPORT 2024

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UPM FINANCIAL REPORT 2024

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UPM ANNUAL REPORT 2024

UPM ANNUAL REPORT 2024