UPM Annual Report 2024

WE ARE UPM

GOVERNANCE

ACCOUNTS AND PERFORMANCE

Our strategy

Our businesses

Sustainability

OUR SUSTAINABILITY FOCUS IN 2024

ENHANCING BIODIVERSITY AND CLIMATE ACTIONS

The EU Corporate Sustainability Reporting Directive (CSRD) has expanded the requirements for sustaina bility reporting. These requirements complement our previous approach of integrated corporate reporting, GRI limited assurance, EU EMAS reports for our pulp and paper mills, and product level information. UPM’s Sustainability Statement begins on page 125. The revised UPM Sustainability Policy State ment, approved by the Group Executive Team, complements our Code of Conduct. The statement describes in more detail our responsible business practices and defines the principles and commit ments to be applied. The statement also defines how sustainability issues will be governed and how We worked on contractor management, focusing on contractors working on UPM’s production sites and forest operations. We collaborated with one of our maintenance service providers to develop a com mon model for verifying fair terms and conditions of work in our subcontracting chains. This comple We continued to develop our human rights risk assessment approach. We carried out a corporate human rights saliency assessment and updated our corporate human rights salient issues accordingly. As part of our ongoing development of UPM’s human rights due diligence, a human rights impacts assess ment was conducted in Uruguay with an external partner (page 75). We participated in the Science Based Targets for Nature Network (SBTN) Corporate Engagement Pro gramme to develop methods, tools and guidelines for setting science-based targets for maintaining and enhancing biodiversity (page 53). We also tested a new scientific methodology, environmental DNA, for measuring biodiversity in field tests in Finland and Uruguay (page 53). We also carried out several actions to restore habitats, develop new ecologically sustainable forest management practices, and improve the monitoring and measurement of UPM’s impact on forest eco systems. As part of our Forest Action Programme, we launched the UPM Habitat Restoration Programme (page 51). By 2030, at least 3,000 hectares of peat land habitats will be restored, and management plans will be implemented on at least 100 other sites in UPM-owned forests in Finland.

UPM's environmental and social performance will be assessed, managed and continuously improved. A new Product Stewardship standard, approved by the Marketing, Sustainability and Communications function’s Management Team, complements the UPM Sustainability Policy Statement. We also updated the UPM Supplier and Third-Par ty Code to meet the evolving requirements of corporate responsibility regulation. We strengthened our requirements for suppliers’ human rights and environmental due diligence practices and reporting obligations. ments the contractor safety work. Implementation of our Sustainable Supply Chain Programme, launched in 2023, continued. We proceeded with our global safety project, which aims to further develop safety practices and increase employee engagement in safety. We also developed process safety further. We participated for the first time in Workplace Pride's annual assessment of LGBTIQ+ practices in companies, and the activities in Employee Resource Group, BeU continued. The network focuses specifically on creating a welcoming and inclusive workplace for members of the com munity worldwide. We continued to prepare SBTi net-zero targets but were unable to proceed due to the further suspension of the forest and wood fibre pathway by the SBTi. We continued the -30 by 30 Programme to reduce CO 2 emissions of purchased goods and services and logistics, with expanded data collection from key suppliers. We also developed category-specific action plans for all UPM’s business areas. The Finnish Meteorological Institute updated its earlier climate scenarios for UPM, and the study was published as part of its scientific series in December. The study observed past changes and future projec tions for Finland, Germany, Uruguay and China. It is almost certain that temperatures will rise in all these regions, but emissions reductions will help mitigate the effects.

STRENGTHENING SOCIAL RESPONSIBILITY AND HUMAN RIGHTS WORK

Value from sustainability

It is an integral part of our strategy to create value for society, both as a responsible company and through our renewable and sustainable solutions.

OUR COMMITMENTS

Our strategy is based on the versatile use of renewable wood biomass, driven by a com mitment to innovation and sustainability. It is a response to some of the biggest challeng es facing the world today, such as resource scarcity, climate change, biodiversity loss and increasing inequality. Our strategy also guides us in achieving our 2030 sustainabil ity targets and contributing positively to the UN Sustainable Development Goals (SDGs). We have linked our financing to our sustainability performance. Our revolving credit facility is linked to our long-term bi odiversity and climate targets, and we have issued four green bonds since 2020. Sustainability is managed by the Board of Directors and the Group Executive Team,

as well as by businesses and functions. Sustainability measures are included in our management remuneration. These include reducing fossil CO 2 emissions from our onsite combustion and purchased energy, and achieving a net positive impact on biodiversity in our own forests in Finland and gender pay equity globally. These meas ures account for 20% of all performance measures. Our 2030 sustainability targets and progress in 2024 on pages 30–32 Committed to compliance on page 76 Sustainability Statement on pages 125–245 Our transition plan on page 149

DEVELOPING REPORTING AND GOVERNANCE

We respect international agreements such as the UN Declaration of Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work, and the OECD Guidelines for Multinational Enterprises. Our values, the UPM Code of Conduct, and the UPM Sustainability Policy Statement form a solid foundation for our decision-making, man agement and operations. We are committed to creating value using sustainable and renewable resources, reducing our environmental footprint and enhancing our positive societal impact.

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UPM ANNUAL REPORT 2024

UPM ANNUAL REPORT 2024