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

POLICIES

ACTIONS

E3-1

E3-2

The UPM Code of Conduct expresses the Company's respect for people, the environment and ethical business practices. It includes its commitment in relation to minimising negative environmental impacts. The Code is complemented by UPM's Sustainability Policy Statement, which addresses the issue in more detail. The UPM Supplier and Third Party Code sets minimum requirements for the value chain. » Refer to G1-1 Policies for more information about these policy documents. In addition, specific aspects are covered in the following policy documents and programmes: • UPM Clean Run Standard » Refer to E2-1 Policies UPM's Sustainability Policy Statement covers water management in a specific section. UPM's production sites aim to minimise water use and wastewater load. Basins where freshwater is scarce or projected to become scarce, or where the quality of the receiving water is considered to be poor, should be given particular attention. New water-intensive production sites shall not be located in areas with a high water risk without appropriate measures to reduce related risks, taking future scenarios and the needs of society and nature into account. Furthermore, UPM's businesses are expected to design and optimise their processes for optimal resource efficiency, using best available techniques. » Refer to E2-1 Policies for more information about the prevention and abatement of water pollution. UPM also manages the impact of its forestry on water resources. UPM's sustainable forest management practices aim to minimise negative impacts and support the role of forests in the hydrological cycle. The Statement also takes UPM's approaches to sustainable product design and to life cycle thinking and life cycle assessment into account. This includes water-related issues. » Refer to E5-2 Sustainable Product Design concept for more information. As a signatory of the UN Global Compact's CEO Water Mandate, UPM follows recognised water stewardship principles. UPM's Sustainable Supply Chain Programme promotes supply chain compliance and risk mitigation. Resource efficiency is considered as one material environmental issue. UPM sources numerous commodities that are material-, energy-, or water-intensive to produce. UPM's sourcing professionals must identify such environmental considerations in their sourcing categories and integrate them into their category strategies and supplier management activities. » Refer to G1-2 Sustainable Supply Chain Programme for more information. UPM does not use marine resources. Connections with oceans or seas are related to the direct discharge of treated wastewater in the case of two UPM production sites located on the coast, the transport of materials and products by sea, and indirectly through the discharge of treated wastewater originating in our operations into rivers and lakes ending up in the sea. UPM has assessed all these impacts but does not consider them to have a material negative impact or to pose a significant risk. • UPM Sustainable Product Design concept • UPM Sustainable Supply Chain Programme

Based on the identified material topics, UPM has set the following focus areas and Group-level targets in relation to water: • Water (with a target for the volume of wastewater) • Responsible sourcing (with a target for spend covered by the UPM Supplier and Third-Party Code) » Refer to G1-2 Responsible Sourcing Action plans have been developed to achieve the Group-level targets, as well as other relevant areas for continuous improvement. The key actions, previous year’s key actions and planned key actions are presented below. UPM's Clean Run concept » Refer to E2-2 Clean Run concept, for a description of UPM's means tor improve environmental performance. Water management Key action Pulp and paper production is UPM's most water-intensive activity. The water used in pulp and paper mills comes from rivers, lakes or groundwater resources. It is used in the production processes as a dilution and transport medium, and as cooling water for energy generation. Cooling water is not contaminated and can be discharged directly into the watercourse or used in production. The water used in production is recirculated internally, and only a small fraction eventually leaves the process as wastewater and needs to be replaced. All wastewater is treated in mechanical and biological effluent treatment plants before being released into watercourses. » Refer to E2-2 Reducing emissions to water for information about wastewater treatment. The Group-level water reduction target (with process wastewater volume as the chosen indicator) therefore focuses on UPM's pulp and paper mills. Each pulp and paper mill has a respective roadmap to achieve its water reduction target by 2030. In addition, UPM's other businesses are also reducing their water use through their own measures. In 2024, the specific process wastewater volume per tonne of paper decreased by 5% compared to the previous year. This decrease does not compensate for the high increase of 23% from 2022 to 2023 which was due to temporary market-related shut-downs of paper mills. This means that there is still an increase of 4% compared to the target base year 2008. The specific value per tonne of pulp decreased by 12% and by 35% compared to the target base year 2008. » Refer to E2-3 Targets for the follow-up of the target at Group level.

Water and marine resources (ESRS E3) Water plays a crucial role in UPM's operations, from sustainable forestry to logistics and production. It is also an important source of renewable energy.

Reduction in wastewater volumes achieved for a UPM average product

Average recirculation ratio of water used to freshwater withdrawn

UPM's water-intensive operations are in areas with sufficient water resources

-16% 20 x Compared to 2008 (2030 target: -30%) Approximate value in pulp and paper production

UPM FINANCIAL REPORT 2024

184

UPM FINANCIAL REPORT 2024

185

184

185

UPM ANNUAL REPORT 2024

UPM ANNUAL REPORT 2024