Metsä Board Annual Review 2024

METSÄ BOARD Annual review 2024

Incidents of non-compliance with good governance or ethical corporate culture 2024

principles of regenerative forestry, which aim to verifiably strengthen the state of forest nature by 2030. Metsä Group seeks to increase understand- ing of regenerative forestry and the role of renewable carbon. Statements on these themes are published on Metsä Group’s website . The company supports the EU’s environmental targets and the 2050 climate neutrality target. Metsä Board’s advocacy efforts as part of Metsä Group focus on: • Promoting the recyclability of wood fibre-based packaging. • Increasing the understanding of the role of fresh fibre in product safety and the advantages of sustainable fibre-based food packaging in terms of the environment and health. • Supporting a comprehensive approach to laws that influence forestry practices and the availability of wood raw material as part of the joint production of forest-based ecosystem services. • Energy-related topics in the EU, such as reducing dependence on fos- sil-based fuels, focusing greater attention on the opportunities provided by biogenic carbon dioxide capture and use, and defining renewable energy targets based on something other than the direct energy use of convertible wood biomass. Cooperation with trade and industrial organisations As part of Metsä Group, Metsä Board is an active member of the Confed- eration of European Paper Industries (Cepi), which represents the forest industry producing fibre-based products across Europe. Representatives of Metsä Group actively participated in the work of Cepi’s committees and working groups. Metsä Board has representatives in the 4evergreen alliance’s steering group and team of public relations experts. 4evergreen represents the entire value chain of fibre-based packaging and has set as its target the raising of the recycling rate of fibre-based packaging to 90% by 2030. Metsä Board also participates in the activities of the European Paper Packaging Alliance (EPPA). The alliance stands for the sustainability of wood fibre-based food and food service packaging and the circular economy. Metsä Board is a member of several national trade and industrial organisations. Key memberships in organisations and advocacy groups: • Confederation of European Paper Industries (Cepi) • European Association of Carton and Cartonboard manufacturers (Pro Carton) • Cepi Containerboard

Metsä Board does not make direct political contributions. The company may participate in seminars that deal with the forest industry or forest policy. In 2024, no seminar tickets were purchased. Payment practices The average time it takes for Metsä Board to pay an invoice from the date when the contractual or statutory term of payment calculation begins is

49 days. The standard payment term in Metsä Board’s general terms and conditions for purchases is 60 days net. However, this can be reconsidered individually in the case of smaller suppliers, for example. Of Metsä Board’s payments, 93%are made within 60 days. Metsä Board is not party to any legal proceedings due to late payments.

2023

COMPLIANCE WITH LAWS AND REGULATIONS Significant incidents of non-compliance resulting in a fine (more than EUR 10,000) Amount of fines paid in the reporting year for inci- dents in previous reporting years CORRUPTION OR BRIBERY Confirmed incidents of corruption or bribery Confirmed incidents in which the company’s own workers have been given notice or sanctioned with disciplinary measures due to an incident linked to corruption or bribery Confirmed incidents in which a business agreement has been terminated or has not been renewed due to an incident linked to corruption or bribery Public legal cases regarding corruption or bribery brought against the company and its own workers Number of judgments issued in corruption or bribery cases Amount of fines issued in corruption or bribery cases

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

Strategy and financial targets

Value creation

The share of certified wood covers the share of certified wood fibre of all the wood fibre used by Metsä Board. The figure includes the wood used in Metsä Board’s own production of pulp and high-yield pulp, as well as the wood used for the pulp pur- chased from Metsä Fibre. The chip deliveries from the company’s own industries are not included in the calculation to avoid double counting. In the completion rate of the Code of Conduct, DEI and Sustain- ability e-learning courses, the divisor is the number of active employees at the time of reporting. In other words, employees absent on family leave or for other reasons are not included in the calculation. As Metsä Board does not make direct donations to political purposes in cash or in kind, no monetary value of in-kind benefits has been estimated. The figures for payment practices do not account for raw wood purchases from forest owners or industrial suppliers. The payment term has been calculated as a weighted average based on the supplier invoices paid in the review period. The total value of the invoice is used in weighting. The metrics have not been validated by an external party.

Reporting principles for metrics The calculation of the ethics index is based on the ethics state- ments included in the annual employee survey. All Metsä Board employees can respond to the survey. Responses are collected on a scale of 1−4 (fully disagree/agree), and an external service provider converts the responses to indexes on a scale of 0−100 (100 = everyone fully agrees). The supplier commitment to the Supplier Code of Conduct indicates the share of all purchases made from suppliers committed to the Metsä Group Supplier Code of Conduct or their own equivalent codes. The figure does not cover the authorities, associations or wood supply. Supplier assessments and audits of core suppliers cover the approximately 350 partner, key and preferred suppliers in accordance with the supplier classification. The target does not include wood supply operators. The joint sustainability targets with partner suppliers applies to the eight partner suppliers agreed in connection with Metsä Group’s supplier classification. The figure does not include wood supply, but partner suppliers include other suppliers of Metsä Group’s Wood Supply and Forest Services. The target of traceable raw materials includes the raw materials used in product production and product packaging materials. The target’s calculation is based on the value of the raw materials in euros. A raw material that is traceable at least to the level of country of manufacture is considered traceable.

Financial development 10 Key figures 12

Report of the Board of Directors

20 20 37 70 89 96

• Sustainability statement

General information

E – Environment

S – Social responsibility

G – Governance

Annexes to the Sustainability statement

Political influence and lobbying activities Metsä Board participates in advocacy as part of Metsä Group at the EU and national level especially in Finland, Sweden and Germany. Metsä Group’s parent company Metsäliitto Cooperative is registered in the EU’s Transpar- ency Register and complies with its code of conduct. Its member number in the Transparency Register is 962687110415-94. Metsä Board is registered in the Finnish Transparency Register with the code MET-24-465-R. The President and CEO of Metsä Group, who also serves as the Chair- man of the Board of Metsä Board, supported by Metsä Group’s Executive Management Team, determines the priorities of political influence for Metsä Board and other business areas and monitors the progress made in them. The Corporate Affairs function is centralised at the Metsä Group level. The Corporate Affairs function coordinates practical influence work, handling the related cooperation among Metsä Board and other functions, and reporting the work’s progress and effectiveness to Metsä Board’s and Metsä Group’s management teams and Boards of Directors. To identify the most significant legal risks and focal areas of lobbying, Metsä Group has conducted a comprehensive assessment of regulatory risks, which covers all the business areas, including Metsä Board. These risks have been considered in the double materiality assessment. Metsä Group follows and participates in discussions about forests and biodiversity and influences policy questions related to the bioeconomy and products. Metsä Group has actively influenced several legal initiatives in the EU, including the deforestation regulation, nature restoration regulation, packaging and packaging waste regulation, and sustainable product policy. Metsä Group promotes the circular bioeconomy and emphasises the role of forests and wood-based products in climate change mitigation, and the safeguarding of biodiversity. Metsä Group is committed to the

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

• European Carton Makers Associations (ECMA) • The European Paper Packaging Alliance (EPPA) • 4evergreen • Finnish Forest Industries Federation

• Skogsindustrierna, Sweden • Die Papierindustrie, Germany

In 2024, Metsä Board paid a total of EUR 1.2 million in membership fees to trade and industrial organisations.

196 Remuneration report 201 Investor relations and investor information

Report of the Board of Directors | METSÄ BOARD ANNUAL REVIEW 2024