UPM Annual Report 2024

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WE ARE UPM

GOVERNANCE

ACCOUNTS AND PERFORMANCE

Report of the Board of Directors

Sustainability Statement

Financial Statements

Auditor's Report

Sustainability Assurance Reports

METRICS

Investigation Allegations or incidents of corruption and bribery can be reported by employees or external stakeholders through the UPM Report Misconduct channel. Such allegations or incidents are investigated in accordance with the UPM Misconduct Investigation Protocol and the UPM Misconduct Investigation Procedure. » Refer to G1-1 Investigation of allegations or incidents of corruption and bribery are carried out under the supervision of UPM's Internal Audit or UPM Legal and Compliance by parties separate from the management chain involved in the matter. The Chief Compliance Officer and SVP of Internal Audit provide reports on the outcome of the investigations to the Ethics Advisory Committee and the Board’s Audit Committee on a quarterly basis. Communication and training Anti-corruption is one of the topics in the UPM Code of Conduct. The Code is distributed to all employees. In addition, UPM has more detailed internal rules on anti-bribery and anti-corruption. Policies and procedures are implemented through training and communication. 99% of active UPM employees (excluding UPM Raflatac companies acquired in 2024) completed the Code of Conduct training, including anti-corruption training at the end of 2024. » Refer to G1-1, table. In addition, all salaried employees must complete UPM's anti corruption e-learning course, which includes a commitment to comply with UPM's Anti-Corruption Rules. UPM has identified its salaried employees as the most at risk of corruption and bribery as they have financial and other decision-making power that can make them more susceptible to corruption and bribery compared to shopfloor employees. The completion rate of the UPM Anti-Corruption e-learning course, last renewed in 2024, was 98% at the end of 2024. » Refer to G1-1, table. UPM complements the e-learning modules with in-person and virtual compliance training for specific target groups. The target groups are determined based on risk assessments. In 2024, the Company organised tailored anti-corruption training for selected target groups across the Company. Compliance training is complemented by regular communication activities to maintain awareness among all employees. Members of the Group Executive Team are included in the target groups for anti-corruption training described above. Anti-corruption training is also provided to the Board of Directors on a regular basis. In addition, each new member of the Board of Directors receives training on the Company's Code of Conduct and other Group policies, including anti-corruption, as part of their onboarding programme. UPM has built a platform to provide training to employees of business partners working for UPM. This ensures that they are committed to the same standards of integrity. The UPM Supplier and Third-Party Code was revised in 2024. It is communicated to suppliers as part of the business contract. In 2024, 91% of UPM's supplier spend was covered by the Code. Suppliers represent the majority of relevant business partners regarding the UPM Supplier and Third-Party Code. » Refer to G 1-2 Responsible sourcing

land use, land use change and forestry (LULUCF). UPM highlighted the importance of sustainable forest management and wood-based products replacing fossils as effective ways to mitigate climate change. The EU's "Fit for 55" package proposal, initially published in 2021, has seen significant progress. By 2024, both the European Parliament and the EU member states will have finalised almost all the necessary changes to align the EU's climate and energy legislation with the EU's climate targets. This comprehensive package aims to reduce net greenhouse gas emissions by at least 55% by 2030, setting the EU on a clear path towards climate neutrality by 2050. UPM actively promotes the cost-competitive and consistent implementation of climate-related policies. UPM calls for predictable regulations that enable investments in the circular bioeconomy. EU policies must therefore ensure the sustainable use of forests and the availability of wood as a key resource for green growth. UPM's main advocacy topics are publicly presented on UPM's website. UPM's Public Affairs Team is led by the EVP, Marketing, Sustainability and Communication, who is a member of the Group Executive Team. UPM also has topic-specific steering groups that steer public affairs activities, and these topics are regularly reviewed by the Group Executive Team. In accordance with the UPM Code of Conduct, UPM does not support political parties or individual candidates financially and in kind. UPM is transparent in its dialogue and engagement with governments and regulators. UPM's identification number in the EU's Transparency Register is 861194311863-31. UPM is also registered in the German Lobby Register and, as of 2024, the new Finnish Transparency Register.

One Board member has held a position in public administration two years preceding his appointment to the Board of Directors, i.e. Mr Jari Gustafsson acted as the Finnish Ambassador for Greece and Albania until 31 August 2024. The President and CEO has not held position in public administration in the two years preceding his appointment to his current position. Actions 2024 • UPM published its main advocacy themes on the Company's website • UPM registered for the Finnish Transparency register and filed the first disclosures • Organising a UPM event "Green growth through bio-based innovations" in Brussels for EU regulators and decision-makers Payment practices The average number of days it takes to pay an invoice after the due date determined in the payment schedule is not followed up by UPM as a payment-related performance indicator. Also, UPM is not gathering statistics on the number of legal proceedings currently outstanding for late payments. The development of the reporting will start in 2025. On average, UPM applies payment terms of 14-60 days in its contracts with suppliers and, as standard, payments are made according to the due date. Individual contracts and respective payment terms may vary between countries and businesses, reflecting the characteristics of the business. » Refer to G1-2 Contractual payment terms G1-6

G1-4

Incidents of corruption or bribery

2024 2023

Number of convictions

Amount of fines (EUR)

In response to violations of UPM's anti-corruption policies and procedures, UPM conducted investigations and monitoring activities and took action to improve its control environment. Disciplinary measures were taken against the employees concerned, and training was provided to identified risk groups. In 2024, two cases of alleged violations of UPM's anti-corruption policies and procedures, including those related to gifts and hospitality, were investigated. In both cases, violations of UPM's policies were substantiated, and the employees concerned were disciplined. There were no confirmed cases of contracts with business partners being terminated or not renewed due to violations related to corruption or bribery in 2024. No cases of corruption or bribery were brought against the Company or its own employees during the reporting period. Political influence and lobbying activities Through public affairs work, UPM aims to promote the necessary prerequisites for its operations, particularly in its main operating countries Finland, Uruguay, Germany and China. Active influencing at EU level is also important. Public affairs activities are based on UPM's strategy. They are also in line with the Paris Agreement. UPM also has topic-specific steering groups that guide public affairs activities, and the Group Executive Team regularly reviews these topics. UPM co-operates with several trade associations, the most important being the Finnish Forest Industries Federation (FFIF) and the Confederation of European Paper Industries (Cepi). As UPM enters into new businesses, it is necessary to find new ways and forums for co operation. For example, UPM is a founding member of the Advanced Biofuels Coalition in the EU and is also a member of the European Chemical Industry Council (CEFIC). UPM is also represented in the decision-making bodies of these trade associations, so that the Company can influence and monitor their positions to ensure that they are in line with UPM's strategy. The basic requirement for membership of any trade association is the principal alignment with UPM's strategic positions. As UPM is an active participant in the energy market, both as an energy-intensive consumer and as an energy producer, UPM reminded decision-makers of the importance of functioning energy markets. Climate change and UPM's commitment to the UN’s 1.5 °C agenda continued to be of great interest to stakeholders. Discussions were held with environmental organisations, certification bodies, authorities and decision-makers. Forests' impact on climate are linked to policies on G1-5