UPM Annual Report 2025

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Actions in 2025 • The construction works for the new biorefinery in Leuna, Germany, were completed. UPM started the production and sales of industrial sugars, the first commercial products in December. • UPM Specialty Papers and Orkla Suomi piloted a new paper wrapper for Panda Milk chocolate. The new wrapper has been validated as recyclable in existing fibre recycling streams. For further examples of collaboration with customers refer to » E5-2 Actions . • At the beginning of 2025, UPM Caledonian paper mill hosted a trial carbon capture unit on site as part of Flue2Chem, a consortium of businesses looking to demonstrate a value chain from biogenic CO 2 to finished consumer goods. The unit captured carbon from the flue gas of the site’s CHP biomass boiler. Planned actions • Sequential startup and ramp-up of the production will be proceeding at the new biorefinery in Leuna, Germany. The biorefinery is expected to reach full production in 2027. • Evaluation of new ways to use renewable biomaterials, e.g. for textiles, nonwovens, hygiene products, and labels. • Assessment of the opportunities offered by green hydrogen and biogenic CO 2 to produce synthetic fuels and chemicals. Resources In general, climate-related activities are included in UPM's overall investment and resource planning. In addition, four green bonds issued since 2020, the latest one in 2024, have a strong focus on climate-related activities. The green bond portfolio of €2,350 million uses eligible assets and projects from the following categories of UPM's Green Finance Framework: • Sustainable forest and plantation management • Climate-positive and circular bioeconomy-adapted products and solutions • Renewable or CO 2 -free energy The Green Finance Framework has been established in accordance with the Green Bond Principles 2021 (with June 2022 Appendix I), and the APLMA, LMA and LSTA Green Loan Principles 2023. Project evaluation and selection is a key process to ensure that projects and assets financed by green finance instruments meet the eligibility criteria set out in the Use of Proceeds section. UPM has established a cross-company Green Finance Committee to coordinate, validate, implement and review the selection of eligible green projects and assets. In addition, UPM has credit facilities which are linked to biodiversity and climate targets. UPM's capital and operational expenditure on most significant climate-related activities are reported under » E1-1 Investment and funding and in the section » EU Taxonomy in the Sustainability Statement. During 2025, no significant capital expenditures for environment related new projects were announced for 2026.

Responsible sourcing: UPM's -30 by 30 Program Key actions In 2022, UPM launched the -30 by 30 Program with the aim of reducing CO 2 emissions related to purchased materials and logistics (Scope 3) by 30%. As part of the program, suppliers are required to provide data on the carbon footprint of the goods and services they sell to UPM. This includes accounting for all relevant emissions from the supplier's upstream supply chain and operations. Actions in 2025 • More suppliers, notably 56, were included in the data collection scope. The share of primary data for the most relevant raw materials is 99% for pulp, 89% for pigments and 51% for chemicals. • Category-specific roadmaps to achieve a 30% CO 2 reduction have been implemented for all UPM business areas. • A company-wide harmonized verification and benchmarking process for carbon footprint data from suppliers was implemented and tested under the -30 by 30 Program to ensure comparability and quality of supply chain emission calculations and also to learn and develop together with suppliers. • UPM and its shipping partner Bore Ltd. have joined FuelEU Maritime compliance pooling service Ahti Pool with three modern dual-fuel vessels in May 2025. The three vessels now use bio-LNG contributing to UPM’s target to reduce fossil CO₂ emissions from its supply chain. Furthermore, UPM Plywood now uses renewable diesel for all its domestic road transport of plywood in Finland. Planned actions • Continue and further expand the annual collection of supplier carbon footprint data to assess development. • Continued focus on implementing category-specific action plans to achieve CO 2 reduction. • Internal shadow carbon pricing will be explored to better compare and rank the carbon footprints of similar materials and suppliers. Product stewardship: Climate-positive product portfolio Key actions The key action in this area is the investment in the world's first industrial scale biorefinery for wood-based biochemicals in Leuna, Germany. The renewable chemicals will have a CO 2 product footprint well below that of fossil-based chemical products, as assessed by a third-party-reviewed Life Cycle Assessment (LCA). In addition, development work toward a climate-positive product portfolio will continue in several areas to meet the 2030 target. Refer to » E5-2 UPM Sustainable Product Design concept

Targets

E1-4

Targets related to climate change To steer its sustainability activities, UPM has set several targets and key performance indicators for its sustainability focus areas covering the three pillars of UPM's climate approach: forests; emissions reductions;

and products. UPM's sustainability targets are developed by UPM by taking the views, wishes, and perspectives of external stakeholders from UPM's constant multi-stakeholder dialogue into account.

Sustainability focus area and key performance indicator

Target follow-up 2025 (2024)

Base year

Base year value

2030 target

Responsible sourcing Fossil CO 2 emissions from materials and logistics (Scope 3) Forestry Climate-positive land-use in UPM's own and leased forests * Biodiversity Net-positive impact on forest biodiversity and developing a monitoring system **

2018

6.08 mt

-30 %

-22% (-22%)

-1.9 (-2.1) mt CO 2 eq (5-year average)

Since 2019

—

Forests as carbon sink (continuous)

Since 2018 (Finland), 2022 (Uruguay)

Usually the previous year

Continuous improvement

Overall positive development measured

Climate Fossil CO 2 emissions Scope 1 and 2

2015

6.80 mt

-65 %

-58% (-50%)

Coal and peat usage

2020

3.3 TWh

0 TWh

2.6 (2.8) TWh

Annual energy efficiency improvement

Since 2016

—

+1% (continuous)

Not achieved

Share of renewable fuels

2015

67 %

above 70% (continuous)

81% (80%)

Product stewardship Climate-positive product portfolio

Since 2019

—

Continuous improvement

Decarbonization solutions: 7% (6%) of sales***

* Five-year annual average carbon sink; approximate value

*** Correction of percentage value (8%) for 2024

** Covers UPM's own forests in Finland and UPM's land in Uruguay

Targets related to climate-positive forestry and innovating products support UPM's development toward net-zero. However, methodologies are still being developed by the GHG Protocol and the Science Based Targets initiative (SBTi) to accurately calculate and formulate targets. UPM's Scope 1, 2 and 3 fossil CO 2 emissions reduction targets for 2030 have been validated by the SBTi to be aligned with the 1.5 °C pathway as outlined in the Paris Agreement. The targets have been set using the SBTi's absolute contraction approach, so that they deliver absolute emissions reductions in line with global decarbonization pathways. The baseline years for Scope 1, 2 and 3 are considered representative for UPM‘s long-term targets on CO 2 reduction. They reflect the long-term transition from a paper company to a material solution company with a broader product portfolio. In 2025, UPM's combined Scope 1 and 2 target of 65% reduction in fossil CO₂ emissions was in line with achieving the 2030 target. The

reduction of fossil CO 2 emissions was -15% compared to 2024 and -58% compared to the base year of 2015. The Scope 3 target of a 30% reduction in fossil CO 2 for purchased materials and logistics was also in line with the 2030 target, with a -22% reduction in fossil CO 2 emissions compared to the base year 2018. Refer to » E1-3 Responsible sourcing: UPM's -30 by 30 Program These targets are supported by specific targets for increasing energy efficiency, the share of renewable fuels, and ending the use of coal and peat in UPM's power plants.

Refer to » E5-3 Targets for certified fibre target Refer to » E4-4 Targets for biodiversity target Refer to » G1-2 Responsible sourcing for sourcing targets Refer to » E1-5 Metrics for share of renewable fuels

UPM Financial Report 2025

160

UPM Financial Report 2025

161

160

161

UPM Annual Report 2025

UPM Annual Report 2025