UPM Annual Report 2024

WE ARE UPM

GOVERNANCE

ACCOUNTS AND PERFORMANCE

Our strategy

Our businesses

Sustainability

ACTIONS FOR ENVIRONMENT

ACTIONS FOR ENVIRONMENT

Driving a circular bioeconomy

OUR PRIORITIES Sustainable product design We consider the environmental and social impacts of our products throughout their lifecy cle, from material selection to production, use and recycling. Our sustainable product design concept guides our product development and ensures that every new product and service has a proven sustainability value proposition. We share best practices, research results and ideas across the company and established internal working groups that focus on the use of side streams and nutrient recycling. Some examples of our side streams and residues are bark, sludges, ash, crude tall oil and lime. Organic production residues such as bark and fibre-containing sludge are used for energy generation and as soil improvers. Ash has multiple uses – for example, in earth construc tion, the cement industry, as a fertiliser or as raw material for paper fillers, or internally to replace caustic soda. We are working hard to find a sustainable use for green liquor dregs, one of our most challeng ing process waste to utilise. We welcome part ners to co-create circular innovations related to the use and valorisation of side streams. Making use of residues, side streams and recovered materials Working with various stakeholders to enhance circularity We are members of organisations such as INGEDE (International Association of the Deinking Industry), the 4evergreen alliance and the CLIC Innovation Ltd innovation cluster. UPM Raflatac actively cooperates with the Ellen MacArthur Foundation. UPM Specialty Papers and UPM Raflatac are members of CELAB, which promotes the development of a circular business model in the self-adhesive label industry.

We use materials, energy and water efficiently, and some of our products are made from side streams, residues or recovered materials.

OUR COMMITMENTS Product stewardship

Resource efficiency and a circular bioecono my respond to resource scarcity, contribute to climate change mitigation and provide sustainable solutions for customers and consumers. Sustainability Statement, ESRS E2 Pollution on page 176 Sustainability Statement, ESRS E5 Resource use and circular economy on page 200

Responsible water management

Our sustainable product design concept considers circularity throughout the product lifecycle. We aim to achieve ecolabelling for all applicable products, increase our climate posi tive product portfolio, and develop new products and services that contribute to the UN SDGs. Efficient use of resources We minimise waste and work consistently to ensure that no process waste is sent to landfill or incinerated without energy recovery by 2030. We maximise the utilisation of materials and side streams, and we have a target of using only recycled nutrients in our own wastewater treatment plants by 2030.

Water plays a crucial role in our business, from sustainable forestry to logistics and production. It is also an important source of renewable energy.

OUR COMMITMENTS Reducing water use and effluent load We continuously reduce the effluent load and volume generated by our operations. Protecting aquatic ecosystems Our efforts to protect and restore aquatic eco systems improve the quality of watercourses and the natural habitat of species that live in them. Water stewardship As a signatory to the UN Global Compact’s CEO Water Mandate, we follow the principles of environmentally sustainable, socially equitable and economically beneficial water use.

OUR PRIORITIES Efficient water use

Pulp and paper production is by far our most water-intensive operation and the focus of most of our water efforts. On average, every litre of water withdrawn is used approxi mately 20 times in the production process, thanks to internal recirculation. Using less water in processes also means using less energy and sometimes chemicals. All wastewater from our pulp and paper mills is treated using both mechanical and biological processes. Purified water is usu ally returned to the same watershed from which it was taken. CDP has recognised UPM with an A– score for our actions to improve water stewardship.

Water-intensive operations in areas with suffi cient water resources, efficient use of recycling techniques and managing processes using Best Available Techniques (BAT). Continuous improvement towards 2030 targets Each pulp and paper mill has a plan to achieve effluent volume and load reduction targets by 2030, using advanced process controls and predictive models to optimise wastewater treatment. Mitigating water risks Our production sites are in areas of low to medium water scarcity. Collaboration We cooperate with local stakeholders and par ticipate in projects to further improve the quality of local waterways.

ACTIONS IN 2024 • The UPM Product Stewardship Stand ard was developed and approved. • Further work was done to find a solu tion for green liquor dregs recycling at UPM's pulp mills in Uruguay and Finland. Dried green liquor dregs were successfully tested in cement produc tion in Uruguay. • WISA birch plywood started to be wrapped and shipped in packaging made of 30% post-industrial plastic. • Trials were conducted at several mills to test recycled nutrients in effluent treatment.

ACTIONS IN 2024 • The water risks of the largest business units were assessed, and the results compared with previous risk assessments. • Piloted the SBTN Science-Based Targets for Nature metholology, which includes freshwater use as part of biodiversity pressures.

• UPM's Santana nursery in Uruguay improved its water recycling system. • The UPM Changshu paper mill in China invested in the recycling of its wastewater to be used as cooling water in the power plant, saving 0.3 m 3 of water per tonne of paper.

Sustainability Statement, ESRS E3 Water and marine resources on page 184

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UPM ANNUAL REPORT 2024

UPM ANNUAL REPORT 2024