UPM Annual Report 2025

We are UPM

Governance

Accounts and performance

Sustainability Statement

Report of the Board of Directors

Financial Statements

Auditor's Report

Sustainability Assurance Reports

For example, distortions in the raw material (wood) market due to the physical impacts of climate change or unpredictable regulation, subsidies or EU policies and resulting national legislation in EU countries could have a significant impact on UPM's financial performance. Opportunities arise from the use of wood as a renewable raw material for UPM's products, which are often an alternative to fossil-based materials. Refer to » Note 1.2 Basis of preparation, section Climate-related risks in the consolidated financial statements Impacts and risks related to pollution, water, circularity, and resource use For all production sites and forestry units, deviations from permit limits and the results of the internal Clean Run standard reviews are used to screen for potential impacts and risks. The Clean Run reviews also help identify best practices and opportunities. Refer to » E2-2 Actions, UPM’s Clean Run concept UPM has screened its pulp and paper mills based on annual benchmarks between sites and against the best available techniques. The pulp and paper mills are considered most relevant in terms of potential water, air and soil pollution, and water use. Resource use and the circular economy are material topics for UPM as a whole. For new products and product development, screening of possible impacts and identification of risks and opportunities throughout the product life cycle is covered by UPM's Sustainable Product Design concept. Refer to » E5-2 Actions, UPM’s Sustainable Product Design concept Environmental impacts and risks related to UPM's upstream value chain are identified as part of the regular sustainability risk salience assessment. In addition, UPM's sourcing categories use the company's Sustainable Supply Chain Program and a dedicated guidance document to identify the highest priority sustainability topics in their category. Refer to » G1-2 Responsible sourcing, UPM's Sustainable Supply Chain Program Water related risks are mapped and analyzed also at UPM’s production sites. In relation to water risks, refer to » E3-2 Water risk assessments UPM does not use marine resources. Connections are related to the direct discharge of treated wastewater in the case of two sites located on the coast, the transportation of resources and products by sea, and indirectly through discharge of treated wastewater into rivers and lakes that end up in the sea. All these aspects have been assessed but are not considered to have a material negative impact or to pose a material risk. Consultation with affected communities is usually part of the environmental permitting process. In addition, ISO 14001 and EMAS emphasize engagement and communication with affected stakeholders. Biodiversity-related impacts and risks UPM continuously assesses actual and potential impacts, risks, opportunities, and dependencies related to biodiversity as part of the annual double materiality assessment and other regular or case-by-case assessments. For example, forest certification plays a crucial role in identifying and managing biodiversity impacts and risks in both UPM's own forests and in other wood sources. UPM participates in a project led by FSC™ to better understand and quantify the positive impacts of forest certification on biodiversity.

Biodiversity risks associated with UPM's upstream value chain are identified as part of UPM's sustainability risk assessment. In addition, UPM's sourcing categories use the company's Sustainable Supply Chain Program and a dedicated guidance document to identify the highest priority sustainability topics in their sourcing category. Regarding biodiversity, the focus is on supply chains with a high risk of habitat destruction, overexploitation, or pollution. Possible ecosystem services of UPM's forest areas are water and recreational value, for example. Assessments and stakeholder information are carried out as appropriate. UPM's main raw material is wood, so UPM depends on forest ecosystems, and the biodiversity and ecosystem services they provide. Industrial activities such as pulp and paper production and hydropower generation also have an impact on biodiversity. communication channels with internal and external stakeholders who are or may be affected by the company's actions. For example, this is done as part of UPM's forest management practices in accordance with FSC™ and PEFC requirements in the company's forestry operations. FSC™ requirements include measures such as identifying and analyzing stakeholders, engaging with stakeholders via meetings or feedback mechanisms, and involving stakeholders in the planning, implementation, and monitoring of forest management activities. This is a continuous process for UPM's forest operations. UPM is also engaging with stakeholders by participating in relevant networks and organizations. In UPM's operations, the most significant impact on biodiversity occurs in wood sourcing. UPM is therefore committed to sustainable forestry that provides high-quality wood, maintains and enhances biodiversity and water protection, and protects the recreational use and ecosystem services of forests. Biodiversity-sensitive areas are identified, and measures are taken to avoid negative impacts on these areas in line with the relevant legislation at national or international level. Compliance-related impacts and risks Refer to » G1-1 Policies, Reporting and identifying concerns, Investigating and handling concerns No systemic risks specific to UPM have been identified. UPM recognizes the importance of dialogue and open

IRO-2

List of disclosure requirements

Refer to » SBM-3 Impacts, risks and opportunities for the mapping of material impacts and ESRS standards Refer to » IRO-1 Materiality assessment process for a detailed description of UPM's double materiality assessment process.

The list of disclosure requirements is integrated into the table of contents at the beginning of this Sustainability Statement. The table below provides an overview of ESRS data points that derive from other EU legislation and where this information can be found if considered material. Regulation references include SFDR (Sustainable Finance Disclosures Regulation) or Others (Pillar 3 , Benchmark regulation, and/or EU Climate Law) as required in ESRS 1 Annex B.

List of data points derived from other EU legislation

Datapoint

Page number

Regulation

ESRS 2 GOV-1 Board’s gender diversity (paragraph 21 (d) )

139

SFDR

ESRS 2 GOV-1 Percentage of Board members who are independent (paragraph 21 (e) )

139

SFDR

ESRS 2 GOV-4 Statement on due diligence (paragraph 30)

143

SFDR

ESRS 2 SBM-1 Involvement in activities related to fossil fuel activities (paragraph 40 (d) i )

144

SFDR

ESRS 2 SBM-1 Involvement in activities related to chemical production (paragraph 40 (d) ii )

144

SFDR

ESRS 2 SBM-1 Involvement in activities related to controversial weapons (paragraph 40 (d) iii )

Not material

SFDR

ESRS 2 SBM-1 Involvement in activities related to cultivation and production of tobacco (paragraph 40 (d) iv )

Not material

SFDR

ESRS E1-1 Transition plan to reach climate neutrality by 2050 (paragraph 14)

156

Others

ESRS E1-1 Undertakings excluded from Paris-aligned Benchmarks (paragraph 16 (g) )

156

Others

ESRS E1-4 GHG emission reduction targets (paragraph 34)

161

SFDR, Others

ESRS E1-5 Energy consumption from fossil sources disaggregated by sources (paragraph 38)

164

SFDR

ESRS E1-5 Energy consumption and mix (paragraph 37)

164

SFDR

ESRS E1-5 Energy intensity associated with activities in high climate impact sectors (paragraphs 40 to 43)

164

SFDR

ESRS E1-6 Gross Scope 1, 2, 3 and Total GHG emissions (paragraph 44)

165

SFDR, Others

ESRS E1-6 Gross GHG emissions intensity (paragraphs 53 to 55)

165

SFDR, Others

Supplier-related impacts, risks and opportunities Refer to » G1-2 Responsible sourcing, Risk mitigation

ESRS E1-7 GHG removals and carbon credits (paragraph 56)

168

Others

ESRS E1-9 Exposure of the benchmark portfolio to climate-related physical risks (paragraph 66)

169

Others

Risks and opportunities related to anti-corruption and bribery Refer to » G1-3 Anti-corruption and bribery, UPM's compliance system

ESRS E1-9 Disaggregation of monetary amounts by acute and chronic physical risk (paragraph 66 (a) )

Phased-in

Others

ESRS E1-9 Location of significant assets at material physical risk (paragraph 66 (c))

Phased-in

Others

ESRS E1-9 Breakdown of the carrying value of its real estate assets by energy-efficiency classes (paragraph 67 (c))

Phased-in

Others

ESRS E1-9 Degree of exposure of the portfolio to climate-related opportunities (paragraph 69)

Phased-in

Others

ESRS E2-4 Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil (paragraph 28)

181

SFDR

ESRS E3-1 Water and marine resources (paragraph 9)

184

SFDR

ESRS E3-1 Dedicated policy (paragraph 13)

Not material

SFDR

ESRS E3-1 Sustainable oceans and seas (paragraph 14)

Not material

SFDR

ESRS E3-4 Total water recycled and reused (paragraph 28 (c) )

187

SFDR

ESRS E3-4 Total water consumption in m3 per net revenue on own operations (paragraph 29)

187

SFDR

UPM Financial Report 2025

152

UPM Financial Report 2025

153

152

153

UPM Annual Report 2025

UPM Annual Report 2025