Sustainable Metsa - in brief

Sustainable Metsä

Wood is the solution to many future challenges.

Unique ownership base and business structure differentiates us • Premium wood raw material from our owners' forests

• A solid basis for our sustainability work and its development Nearly

100,000 Finnish forest owners

• Opportunities for profitable and sustainable growth

We are Committed to a Sustainable Future Replacing fossil materials

Secures biodiversity

Northern renewable wood raw material

Sustainably managed forests

Slowing climate Only renewable change fuels

Saving resources

Resource efficient production

Safe and equal work environment

It’s good to be at work

5% of Finland’s export

Aiming for full traceability

Sustainable suppliers

Supporting society

Sustainable use of natural resources

Sustainable business practices

Our impact on the environment

• A pioneer in the bio- and circular economy • Efficient and sustainable use of renewable wood raw material • Reducing dependence on fossil materials • Minimising emissions and waste

We design new production units to be as emission-free as possible

Our activities are guided by materiality themes

• Safety at work

• Renewable energy

• Sustainable supply chain

• Supporting local livelihoods and society

• Emissions into air and water

• Innovations

• Water use

• Product safety

• Sustainable forest management

• Circular economy and new bioproducts

• Resource efficiency

Our ambitious sustainability targets towards 2030 Well-being

Sustainable choices

100 %

100 % 0 Responsible

100 %

100 %

Fossil free products & packaging materials

Sustainable suppliers

Climate and environment

100 %

corporate culture

Forests and wood 90 % Harvesting sites have biodiversity stumps

Accidents

100 % Regeneration harvesting sites have retention trees

+30 % Carbon bound to forests & products vs. 2018

Traceable raw materials

Side streams utilised

0

-25 %

Fossil CO2 emissions (own production)

Process water per product tonne vs. 2018

Our chosen UN Sustainable Development Goals (SDGs)

We produce renewable energy.

We make our own energy consumption more efficient.

We promote sustainable industry. We invest and innovate.

Our goal is fossil-free production and raw materials. We communicate the opportunities of a sustainable bioeconomy to our stakeholders.

We clean the water we use, make our water use more efficient, and do not undermine anyone else's access to water.

We directly and indirectly employ a large number of people. We promote responsible business practices in our supply chain

Our products are recyclable, and they store carbon. Our raw material is renewable wood. We are resource-efficient and minimise our environmental impact.

We promote sustainable forest management. Safeguarding biodiversity is our strategic objective.

8

Well-being

FINLAND

Together, we achieve firstclass results.

5 397 NORTH AMERICA

ASIA AND AUSTRALIA 67

46

We employ

9,500

TEH REST OF THE EUROPE

professionals representing a variety of fields.

Wood Supply and Forest Services Metsä Wood Metsä Fibre

4325

Metsä Board Metsä Tissue Metsä Group others

Situation on 31.12.2021

Leading sustainability

The implementation of the strategic sustainability objectives is reviewed quarterly by Metsä Group's Sustainability Management Group

• The activities of the Management Team are supported by a group of sustainability experts from across Metsä Group • Sustainability is part of each Metsä Group employee’s personal annual target

Our influence on society

We work towards world’s common goals on sustainability

• We want to be fair and open neighbors locally • We actively participate in international, European and national industry and trade organisation work • We are a trusted partner for industry associations, legislators and policy makers

Contributing to the community In 2021, the value of exports from our Finnish mills EUR

3.6

billion

equivalent to nearly 5% of Finland’s exports.

We create around 15,000 indirect jobs in Finland.

Metsä Group as a taxpayer In 2021, we paid a total of

EUR

157.7

million

in income and property taxes.

It’s great to be at work An equal and responsible business culture for all

• Our goal is that our employees feel that we have a responsible corporate culture, and it is measured with an ethics barometer every other year • We improved our performance during 2021 by completing 98% of the actions launched in responses to the 2020 ethics barometer

Our 2030 objective

Focus on incident prevention and risk identification

Safety is a skill

Our 2030 objective is zero accidents at work • The frequency of recordable accidents at work (TRIF) decreased to 8.1 • The same safety practices for partners, service providers and other stakeholders

Our 2030 objective

Forests and Wood

In commercial forests, biodiversity is improved by increasing important structural features such as decaying wood

Safeguarding forest biodiversity

Hundreds of decaying wood stumps are created in Finnish forests daily - totaling hundreds of thousands in a few years

Our objective is to create more decaying wood in the forests by the end of 2030 •

leave retention trees on all our regeneration sites

•

in 90% of thinning and regeneration harvests, four biodiversity stumps are left for every hectare

Our 2030 objectives

Actions contributing to the biodiversity of commercial forests Retention trees, decaying wood and protective thickets safeguard the biodiversity and increase landscape value of commercial forests.

Leaving biodiversity stumps is voluntary for forest owners and is agreed separately in the timber sale.

SäästöpuuThe main purpose of ryhmillä on kaksitree the retention päätarkoitusta: groups is twofold: to lisätä metsään save trees of different eri-ikäisiä puita ages and create more ja järeää decaying wood to the lahopuustoa. forest.

Our Nature Management Programme funds development projects in Finland

1

Must have positive impacts on biodiversity or the state of waters

2

Financial investment program until 2031

3

New projects are selected every six months

Sustainable forest use • Wood from forests that grow more than they are used • We use 100% of the tree • In 2021, we delivered 34 million seedilings to forest owners in Finland

The origin of the wood is fully traceable and 88% of it is certified

Nothing is wasted from the tree Wood raw material from regeneration felling

Branches and top 15%

Pulpwood 25%

Bioeconomy and circular economy at our mills Branches and top into renewable energy Sawdust into renewable energy and raw material • Bark into product gas and other renewable energy • Chips into pulp

Log 60%

Sustainable products From pulpwood • Pulp • Paperboard • Tissue and greaseproof paper • Othet bioproducts* • Textile fibres** • 3D fibre products** From log wood • Sawn timber • Kerto® LVL • Plywood

** Other bioproducts include i.a. tall oil, turpentine, methanol, sulphuric acid, fertilisers, soil improvement agents, biogas, electricity and heat ** New products under development

New forests and new carbon sinks The faster and better quality the new forest is established, the faster it will start absorbing carbon from the atmosphere

Our goal is to increase the amount of carbon bound in forests by 30% compared to 2018 • We establish new forest and regenerate the harvested one • We increase the area of regeneration and young stand management

Our 2030 objective

We aim to increase the amount of carbon stored in long-lived products by 30% compared to 2018

Aiming for carbon sinks

• Renewable wood raw material from sustainably managed northern forests stores carbon for decades

Our 2030 objective

Our wood products, are carbonstoring building materials that generate little waste from their use

Our Ecological Sustainability Programme promotes the responsible use of commercial forests

1

Strengthening forest growth and carbon sequestration

2

Safeguarding forest biodiversity

3

Improving water protection in forestry

Climate and Environment

Outbound material streams

We use raw materials, energy and water as efficiently as possible We are continuously reducing our environmental impact and improving our operations.

Most of our operations use renewable energy.

Inbound material streams

Our aim is to use only biobased fuels in our production and thereby generate zero fossilbased carbon dioxide (CO2) emissions by 2030

Reducing our climate impact New mills and production lines are designed to be fossilfree from the start

•

We quit using peat in many of our mills during 2020-2021

Our 2030 objective

Most of our emissions to air come from pulp mills and power plants •

Our impact on environment

The waters near our factories are used for recreational purposes

We participate in air quality monitoring at several factory sites

The more we save and use energy efficiently, the fewer emissions we produce

Our objective is to reduce process water usage (m3/tonne produced) by 25% compared to the base year 2018 • Water use is reduced through more efficient processes

We use water efficiently

• More than 99% of the water we use is surface water

Our 2030 objective

The cooling water circulates in its own separate system

Reducing environmental impacts through more efficient operations 90% of our fuels are wood by-products and wood residues

•

87% of the energy used in production was fossil-free in 2021

•

Efficiency is measured by an energy efficiency index (the ratio of electricity, heat and fuels used in production to the amount of production)

Only a fraction of side streams remain unused

Our objective is to find a use to all of our production side streams by the end of 2030 •

We use the side streams primarily as raw materials and secondarily as energy

•

Forests benefit from the nutrients in side streams such as ash which is recycled back to the forest Our 2030 objective

Sandy bark is used in landscaping or as a raw material for gardening soil

Sustainable Products

Our objective is that by the end of 2030, we will not use fossil oilbased raw materials or packaging materials

•

We are looking for alternatives to fossil, oil-based raw materials

We take environmental considerations into account when looking for alternative materials

Our 2030 objective

We encourage raw material suppliers to actively develop their products

Our 2030 objective is full traceability of all raw materials

The origin of raw materials is important to us

•

Our main raw material is fully traceable wood

•

We develop the traceability of other raw materials, including process, basic and coating chemicals

Our 2030 objective

The traceability of the raw materials improved due to more detailed questionnaires

Our 2030 objectives

Sustainability throughout the supply chain We assess suppliers by analysing risks per procurement category and using risk ratings •

Our aim is to have a sustainable supply chain, which is assessed through the coverage of our suppliers’ code of conduct, compliance and sustainability assessment

•

Sustainability is assessed through self-assessment questionnaires and on-site audits, among other things

Summary

• Renewable wood replaces fossil raw materials

Sustainability needs our actions

• Sourcing wood from Northern forests that grow more than they are used • Safeguarding biodiversity • Towards fully renewable energy in our production

In 2021, we produced more than

Fossil CO2 emissions from our factories

15%

0

of Finland's renewable energy

in 2030

tonnes

• Taking care of safety at work and creating well-being around us