Metsä Board Annual Review 2024

METSÄ BOARD Annual review 2024

Attendance at Board and committee meetings by member

proper organisation of its operations. The Board of Directors is responsible for the proper organi- sation of the Company’s financial management and accounting control. The Board is also responsible for the direction and supervision of Metsä Board Group. Taking the scope and nature of the Company’s activities into account, the Board of Directors is responsible for matters that are economically, commercially or princi- pally significant and far-reaching and thus not part of the business’s day-to-day management. Among other things, the Board decides on the Company’s strategy, major investments, organisational structure and important financial matters. The Board of Directors ensures that the Company operates responsibly and takes the interests of the Company’s other stakeholders, as well as the collective interests of sharehol- ders, into account. Metsä Board’s Board of Directors has written rules of procedure for its activities. Accordingly, the Board of Directors shall, among other things: • nominate and dismiss the CEO and the deputy CEO, and decide on the CEO’s terms of engagement; • organise the Company’s accounting, financial and risk management, and the supervision of the financial and sustainability reporting process, as well as analyse the most signifi- cant risks for the group; • supervise the CEO’s management of the Company’s operations management in line with the Board’s instructions and orders; • adopt the Company’s values and the Board’s diversity policy; • monitor and guide the Company’s contribu- tion to sustainable development; • review and adopt the Company’s long-term action plan, strategy, annual action plan and budget; • decide on significant investments, corporate transactions, acquisitions, mergers, divestments and closures of business operations; • decide on significant financing arrange- ments, including debt financing, the provision of securities and subsidiary capitalisation; • decide on the assignment or pledging as securities of the Company’s significant fixed assets; • decide on the granting of donations to the extent that they do not fall within the compe- tence of the General Meeting;

• decide on the delegation of its powers, subject to express limits of approval and rules of delegation, and the granting and revoking of representation rights; • convene an Annual General Meeting and supervise the implementation of resolutions it passes; • sign and present the financial statements and the Board of Directors’ annual review, including the sustainability statement, to the Annual General Meeting and prepare a proposal for dividend distribution; • approve and publish a financial statement bulletin, half-year financial report and interim reports for each quarter; • adopt the key policies guiding the Company’s business operations and insider guidelines and disclosure policy governing communica- tions, and supervise their application; • decide on remuneration schemes, their criteria and conditions, as well as monitor their implementation. The Board of Directors’ rules of procedure are available in their entirety on the Company’s website at https://www.metsagroup.com/ globalassets/metsa-board/documents/ investors/corporate-governance/en/general/ metsa-board-board-working-order.pdf . Within its general competence, the Board of Directors may delegate to the CEO and, conversely, may decide on a matter within the CEO’s general competence. The Board of Directors annually assesses its own operation and the Company’s corporate governance principles, making any necessary changes to them. Composition, diversity and independence of the Board of Directors The composition and number of members of the Board of Directors must enable it to carry out its duties effectively. The composition of the Board of Directors takes the stage of development of the Company, the ownership base, the specific requirements of the industry and the needs of the Company’s operations into account. The Board’s objective is to create a diverse Board, with the proviso that those elected to the Board must have the necessary qualifications and be able to devote the time required to perform their duties. The Board of Directors comprises female and male members.

The Board of Directors has adopted a Diver- sity Policy, which is available on the Company’s website. The Board of Directors recognises the benefits that a diverse Board composition brings to the Company and its shareholders. Diversity supports the Board’s open working atmosphere, independent role and decision making. The Board’s key role is also to proactively and con- sistently support and challenge the Company’s executive management from a wide range of perspectives. The successful performance of the duties of the Board and its Committees requires a diversity of composition, skills and experience, as well as a consideration of the personal qualities of individual Board members. Furthermore, diversity must support the Com- pany’s current stage of development and meet its future needs and business development. In addition to a knowledge of the Company’s industry, Metsä Board has identified experience in different industries and the international operating environment as essential for the diversity of the Board of Directors. The Board members’ complementary educational back- grounds, management experience in different areas of the business, and diverse age and gender distribution have also been identified as factors contributing to diversity. Metsä Board’s objective is for both women and men to be rep- resented on the Board. The Board’s Nomination and HR Committee takes the diversity principles into account when proposing the Board’s composition to the Annual General Meeting each year. The achievement of the Board’s diversity objectives is monitored as part of the normal activities of the Board and its Nomination and HR Committee. According to the Articles of Association, the Board of Directors shall consist of at least five and at most ten ordinary members elected by the shareholders at the Annual General Meeting for a term of office starting from the end of the General Meeting that elected the member and continuing until the end of the next Annual General Meeting. There is no limit to the number of consecutive terms of office. The Board of Directors shall elect a Chair and Vice Chair from among its members. In 2024, the Board of Directors had nine (9) members, of whom 56% were men (5), and 44% were women (4). The age range of the Board members was 45 to 64.

Of the nine (9) members of the Board of Directors, 89% (8) were independent of the Company, and 67% (6) were independent of a major shareholder of the Company.

Number of Board meetings

Independence from the Company

Independence from the major shareholder

Business operations and value creation 2 This is Metsä Board 4 CEO’s review 6

Attendance rate (%)

Member of the Board of Directors Ilkka Hämälä (Chair of the Board)

14/15 15/15

No Yes Yes Yes Yes Yes Yes Yes Yes Yes

No No Yes Yes Yes Yes Yes No Yes Yes

GENDER DISTRIBUTION %

Jussi Linnaranta

100 100

Hannu Anttila (until 26 March 2024) Leena Craelius (as of 26 March 2024)

5/5

8/10 14/15 14/15 15/15 15/15 14/15 15/15

80 93 93

Strategy and financial targets

Raija-Leena Hankonen-Nybom

Value creation

Erja Hyrsky

Mari Kiviniemi

100 100

Men�� 56 Women�� 44

Mikko Mäkimattila

Financial development 10 Key figures 12

Jukka Moisio

Juha Vanhainen

100

Report of the Board of Directors

20 20 37 70 89 96

• Sustainability statement

AGE DISTRIBUTION %

General information

Board of Directors’ Committees If necessary, the Board of Directors may decide to establish committees to prepare and discuss matters falling within its competence, with the assistance of the Board of Directors. The Board has appointed an Audit Committee and a Nomination and HR Committee from among its members. The Board of Directors appoints the chair and members of each committee annually after the Annual General Meeting. The Board and its committees may also be assisted by external advisors. Based on committees’ the proposals, the final decisions on matters within the scope of the committees’ duties are taken by the Board of Directors, with the exception of proposals on the composition and remuneration of the Board of Directors made directly to the General Meeting by the Nomination and HR Committee. Audit Committee The Audit Committee’s role is to assist the Board in ensuring the accuracy, balance, transparency and clarity of the Company’s financial reporting, accounting methods, financial statements, and other financial information and sustainability reporting the Company discloses. The Audit Committee assesses the effectiveness and scope of internal audits, the Company’s risk management, key risk areas, and compliance with laws and regulations. It assesses the independence of the auditor and audit firm and makes a recommendation to the Board on the selection of the Company’s auditor. The Audit Committee also reviews the internal audit’s

half-yearly action plans and reports on signifi- cant audits. The committee’s members must have sufficient expertise in accounting and financial reporting. The Audit Committee meets regularly, at least four times a year. In connection with its meetings, the committee shall consult the Company’s auditor. The Chair of the committee shall report on each meeting of the Audit Committee to the Board of Directors. The Audit Committee’s duties and responsibilities are set out in its charter, which the Board of Directors has approved ( https://www.metsagroup. com/globalassets/metsa-board/documents/ investors/corporate-governance/en/general/ metsa-board-rules-of-procedure-for-audit-com- mittee.pdf ). The Company’s auditor, the CEO and CFO, as well as other management representatives and external advisors as required, are also represented at the Audit Committee meetings when invited by the committee. The board members listed in the table below have acted as members of the Audit Committee since the 2024 Annual General Meeting. The members of the Audit Committee are indepen- dent of the Company and its major shareholder. The Audit Committee met five times during 2024. Committee members’ attendance rate was 96% (92% in 2023 and 100% in 2022).

E – Environment

S – Social responsibility

40–50��11 51–60�� 44 61–65�� 44 >65��0

G – Governance

Annexes to the Sustainability statement

98 Consolidated financial statements 102 Notes to the consolidated financial statements 150 Parent company financial statements 153 Notes to the parent company financial statements 166 The Board’s proposal to the Annual General Meeting for the distribution of funds 167 Auditor’s Report 171 Sustainability statement assurance report 173 Shares and shareholders 177 Ten years in figures 178 Taxes 179 Production capacities 181 Calculation of key ratios and comparable performance measures Corporate governance 183 Corporate governance statement 190 • Board of Directors of Metsä Board 194 • Corporate Management Team of Metsä Board

No members of the Board of Directors are executive officers of the Company. The Board as a whole has extensive experience of good corporate governance, international business and management, either in operational or fiduciary positions in various industries, including the forest industry, forestry, engineering, the food industry and auditing. The Board also has many years of experience of managing sustainability issues and assessing the risks and opportunities involved. The Board of Directors’ composition and a summary of the Board members’ work history and positions of trust can be found below in the Board members’ introduction and on the Company’s website, https://www.metsagroup.com/ metsaboard/investors/corporate-governance/ board-of-directors/ . In the 2024 financial year, the Board held a total of 15 meetings. Board members attended 97% of the meetings (97% attendance in 2023 and 97% in 2022).

196 Remuneration report 201 Investor relations and investor information

184

185

Corporate governance statement | METSÄ BOARD ANNUAL REVIEW 2024