Grupa Azoty SA Company Address

Annual Environmental & Social Report

1. Information about the Company Company Name: Grupa Azoty S.A. Company Address: ul. Kwiatkowskiego 8, 33-101 Tarnów, Poland Country: Poland Town/Location: Tarnów Company authorised representative: Piotr Skóra I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period.

Signature: Piotr Skóra Title: Company Treasurer Date: April 15th 2021 Contact Details: Telephone: (+48) 14 637-48-52 Mobile: Email: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide:

Item Cumulative

[PLN ‘000] 2019 2020

Revenue 1,834,609 1,738,272 Profit/(loss) on sales 377,414 335,953 EBIT 161,389 141,520 EBITDA 290,376 263,898 Net profit/(loss) 126,083 117,828

* In the reporting period the presentation of financial statements was changed to improve disclosures regarding the effect of certain transactions on the Company's assets and financial position. The comparative data was appropriately restated.

Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions;

See Section 4 and Section 5.

Number of staff employed and any change in employment over past 3 years

As at Dec 31 2018 As at Dec 31 2019 As at Dec 31 2020 Number of direct employees: 2,200 2,192 2,218 Number of contracted workers: - - -

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive)

Currently, Grupa Azoty S.A. operates pursuant to the following decisions:

Integrated permits: • Decision by the Marshal of the Kraków Province dated June 20th 2012 Ref. No. SR-II- 1.7222.1.1.2012, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie-Mościcach for the Hydrogen Unit, valid for an indefinite term (permit amended by Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.13.2014); • Decision by the Governor of the Kraków Province dated February 16th 2007 Ref. No. ŚR.XIV.JI.6663-6-05, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie- Mościcach for the Park Infrastruktura Complex, valid for an indefinite term (permit amended by Decision of July 29th 2011 Ref. No. SR-II-1.7222.1.3.2011, Decision of September 11th 2012 Ref. No. SR-II-1.7222.1.7.2012, Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.17.2014, Decision of December 31st 2015Ref. No. SR-II-1.7222.2.1.2015, Decision of March 10th 2017 Ref. No. SR-II.7222.2.9.2016; Decision of June 22nd 2020 Ref. No. SR-II.7222.2.4.2020, and Decision of August 12th 2020 Ref. No. SR-II.7222.2.28.2019); • Decision by the Governor of the Kraków Province dated April 17th 2007 Ref. No. ŚR.XI.JI.6663-3- 06, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie - Mościcach for the POM Manufacturing and Compounding Complex, valid for an indefinite term (permit amended by Decision of July 29th 2011 Ref. No. SR-II-1.7222.1.1.2011 and Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.14.2014); • Decision by the Governor of the Kraków Province dated July 29th 2011 Ref. No. SW.II.1.AJ.7673- 10/09, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie - Mościcach for the Technical Grade Nitric Acid Unit, Calcium Ammonium Nitrate and Ammonium Nitrate Unit, Nitrogen Fertilizer Granulation Unit, and Dolomite Milling Unit, valid for an indefinite term (permit amended by Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.15.2014, Decision of August 16th 2016 Ref. No. SR-II.7222.2.8.2016, Decision of July 21st 2017 Ref. No. SR- II.7222.2.27.2016, and Decision of January 18th 2018 Ref. No. SR-II.7222.2.34.2017); • Decision by the Governor of the Kraków Province dated July 17th 2007 Ref. No. ŚR.XIV.JI.6663-2- 06, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie-Mościcach for the Caprolactam and Polyamide Manufacturing Complex (permit amended by Decision of March 16th 2009 Ref. No. SW.II.1.JI.7673-6/08, with respect to the Natural Polyamide Unit), amended in its entirety by Decision by the Marshal of the Kraków Province dated December 1st 2010 Ref. No. SW.II.1.AJ.7673-11/08 (permit amended by Decision of July 29th 2011 Ref. No. SR-II- 1.7222.1.2.2011, Decision of February 16th 2012 Ref. No. SR-II-1.7222.1.2.2012, and Decision of June 20th 2012 Ref. No. SR-II-1.7222.1.5.2012), Decision of October 21st 2013 Ref. No. SR-II- 1.7222.1.3.2013, Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.16.2014, Decision of January 23rd 2018 Ref. No. SR.II.7222.2.12.2017, Decision of August 17th 2020 Ref. No. SR- II.7222.1.28.2018.AJ, and Decision of December 10th 2020 Ref. No. SR-II.7222.2.24.2019.AJ, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated June 28th 2018, Ref. No. SR- II.7222.13.4.2016, granting an integrated (IPPC) permit to Grupa Azoty S.A. for its Iron- Chromium Catalyst Plant II, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated July 1st 2015 Ref. No. SR-IV-1.7222.1.2015, granting an integrated (IPPC) permit to Grupa Azoty S.A. for the Central Wastewater Treatment Plant, (amended by Decision of April 20th 2018 Ref. No. SR-II.7222.1.7.2018.MM and Decision of June 24th 2020 Ref. No. SR-II.7222.2.17.2019.WM),valid for an indefinite term; Air emissions • Decision by the Governor of the Kraków Province dated December 29th 2014, Ref. No. SR-II- 1.7221.2.2014, granting a permit for release of gases and particulate matter into the air to Grupa Azoty S.A., valid until December 28th 2024; • Notification of Grupa Azoty S.A.'s EC II CHP Plant Water Treatment Unit and Modified Plastics Facility to the Marshal of the Kraków Province Ref. No. TB/JK/1034/2014, dated November 24th 2014; EU ETS • Decision by the Marshal of the Kraków Province dated April 28th 2017, Ref. No. SR- II.7225.1.21.2016, granting permission to participate in the European Union Emissions Trading Scheme for the CHP plant located on the premises of Grupa Azoty S.A., including a Monitoring Plan, amended by Decision by the Marshal of the Kraków Province dated September 16th 2019, Ref. No. SR-II.7225.2.3.2019.AJ, including a Monitoring Plan, and Decision of the Marshal of the Kraków Province dated September 28th 2020 Ref. No. SR-II.7225.2.9.2019.AJ, including a Monitoring Plan, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated April 2nd 2020 Ref. No. SR- 3

II.7225.6.2.2019.AJ, approving the Monitoring Methodology Plan for the CHP plant; • Decision by the Marshal of the Kraków Province dated November 24th 2017, Ref. No. SR- II.7225.1.7.2016, granting permission to participate in the European Union Emissions Trading Scheme with respect to greenhouse gas emissions from the units manufacturing nitric acid, ammonia and bulk organic chemicals by way of cracking, reforming, oxidation or similar processes, with a daily production capacity of over 100 Mg, including a Monitoring Plan, amended by Decision by the Marshal of the Kraków Province dated June 13th 2019 Ref. No. SR- II.7225.3.12.2018.AJ, including a Monitoring Plan, and amended by Decision by the Marshal of the Kraków Province dated January 18th 2021 Ref. No. SR-II.7225.2.3.2020.AJ, including a Monitoring Plan, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated April 2nd 2020 Ref. No. SR- II.7225.6.3.2019.AJ, approving the Monitoring Methodology Plan for the Production Units. Water and wastewater • Decision by the Mayor of Tarnów Ref. No. WGK.B-III.6210/16/02/03 dated January 13th 2003, granting a permit for collective water supply and collective wastewater discharge, valid for an indefinite term; • Decision by the Governor of the Kraków Province dated December 30th 2014 Ref. No. SR-IV- 1.7322.1.28.2014.MG, granting a permit for special use of water – abstraction of groundwater from an intake point located in Tarnów-Mościce, valid until December 31st 2034; • Decision by the Governor of the Kraków Province dated December 29th 2005 Ref. No. ŚR.XIV.MGą.6811-31-05, granting a permit for special use of water – abstraction of surface water from the Dunajec river, valid until December 31st 2025, amended by Decision Ref. No. KR.RUZ.4211.180.2018.IT dated November 16th 2018; • Decision by the Regional Water Management Authority of Kraków Ref. No. KR.RUZ.421.1.102.2019.AS dated July 1st 2019, granting a permit for discharge of wastewater containing substances particularly harmful to the water environment into the sewerage system of Zakład Oczyszczania Ścieków T.W. Sp. z o.o., valid until July 1st 2023; • Decision by the Marshal of the Kraków Province dated December 15th 2017 Ref. No. SR- IV.7322.1.259.2017.MG, granting a permit for discharge of wastewater into surface waters, valid until December 31st 2021; • Decision Ref. No. SR-IV.1.7328.1.2013.MG, establishing a protected zone for water intake points; Waste • Decision by the Marshal of the Kraków Province dated January 20th 2016 Ref. No. SR-III- 1.7244.4.9.2015.AG permitting Grupa Azoty S.A. to collect and process waste, valid until January 19th 2026; Other • Resolution of the Provincial Assembly of the Kraków Province of October 25th 2010, No. LI/833/10, establishing Industrial Zone at ZAT S.A. (Official Journal of the Province of Kraków, No. 580/2010, item 4475).

Reporting period: 2020

Have there been any accidents or Yes [X] If Yes, please describe, including details of incidents that have caused damage to No [ ] actions to remedy and prevent reoccurrence: the environment, brought about injuries or fatalities, affected project In total, 12 accidents at work were reported. labour or local communities, affected Each was investigated to determine its causes, cultural property, or created and appropriate post-accident recommendations liabilities for the Company? were issued. There were 2 incidents causing odour nuisance outside the plant, with no environmental damage. Have there been any changes to Yes [X] If Yes, please describe: environment, social, labour or health No [ ] and safety laws or regulations that A Safety and Health Management Policy was have materially affected the adopted at Grupa AzotyS.A. (December 2020) Company? How many inspections did you receive Number: 4 Please provide details of these visits, including from the environmental authorities number and nature of any violations found: during the reporting period? State Environmental Inspection Authority In 2020, the State Environmental Inspection Authority (through the Tarnów Provincial Inspectorate for Environmental Protection (WIOŚ)) carried out 4 inspections.

I. Inspection Report No. TAR 128/2020 – the inspection was carried out at the Ammonia Department (Business Unit: Fertilizer Production, Ammonia Water Unit) in connection with strong odour nuisance having been reported on June 12th 2020 by private individuals (smell of ammonia ) in the vicinity of Grupa Azoty S.A. The source of the nuisance was repair work carried out on the ammonia water unit, with the AC6 absorption column for off-gas from AV3 and AV4 storage tanks temporarily shut down, and the VKGZ flare burning off-gas from AC6 column also temporarily shut down. According to WIOŚ, the incident did not meet the criteria to be classified as a major accident subject to notification to the Chief Inspector of Environmental Protection, but it met the criteria to be classified as an industrial accident.

Following the inspection, Requirement Notice of July 27th 2020 Ref. No. TI.7024.6.8.2020.Gz was issued, including four decisions to be implemented:

1. Take steps to ensure continuous transmission of results of pH and temperature measurements at the Ef+A0 ditch between measuring point 101 (the Sutro weir upstream of a discharge outlet for industrial wastewater – 5

mixture of rainwater or meltwater and spent cooling water discharged into the Dunajec river) and the Central Wastewater Treatment Plant’s control room, and take action to ensure immediate response to any disruption in that transmission.

2. Submit to the Kraków Provincial Inspectorate for Environmental Protection, Branch Office in Tarnów, and implement, on an ongoing basis, a detailed action plan (including the names of individual actions and their deadlines ) aimed at achieving the level of wastewater treated at the Biological Wastewater Treatment Plant (BOŚ) that would ensure compliance with the conditions for the introduction of wastewater into the sewerage system of Tarnowskie Wodociągi Spółka z o.o. , as specified in the relevant water-law permit held by the Company (based on decision by the Kraków Regional Water

Management Authority of the ‘Polish Waters’ National Water Management Authority

Ref. No. KR. RUZ.421.1.102.2019.AS dated July 1st 2019), and in agreement No. 01/01/2011 on the provision of wastewater treatment services of January 21st 2011 concluded between Tarnowske Wodociągi Sp. z o.o. and Zakłady Azotowe w Tarnowie-Mościcach , and the Regulation of the Minister of Construction of September 28th 2016 on the fulfilment of the obligations of producers of industrial wastewater and the conditions for introduction of such wastewater into sewerage systems (Dz.U. of 2016, item 1757). 3. In the event of an industrial accident , immediately notify the Commander-in-Chief of the State Fire Service in the Kraków Province and the Kraków Provincial Inspectorate for Environmental Protection , in accordance with Art. 264.1 of the Environmental Protection Law of April 27th 2001 (Dz.U. of 2020, item 2019). 4. Submit to the Kraków Provincial Inspectorate for Environmental Protection, Branch Office in Tarnów, information on the planned measures 6

to prevent reocurrence of the industrial accident which took place on June 12th 2020, along with a schedule for their implementation, in accordance with Art. 264.2 of the Environmental Protection Law of April 27th 2001 (Dz.U. of 2020, item 2019).

In response to requirement notice dated July 7th 2027 Ref. No. TI.7024.6.8.2020.Gz, a letter of August 11th 2020 (Ref. No. NBP/LSz/194/2020) was submitted to WIOŚ, containing a schedule of remedial and organisational measures aimed at ensuring that each of the requirements is complied with: Re 1. The following procedures have been developed and implemented, to be followed in the event of any failure of the pH-meter, temperature sensor, controller or data transmission system: At monitoring points 100 (Central Wastewater Treatment Plant outlet) and 101 (EF+ A0 wastewater ditch), measuring instruments have been installed for continuous monitoring of the PH and temperature of discharged wastewater. Current readings are shown on the wastewater information board, with the minimum (6.5) and maximum (9.0) pH values indicated. If a malfunction of a measuring instrument is found, it must be reported immediately to the automation specialist on shift 1 or to the controller on duty on shift 2 or 3. Until the online measuring instruments are repaired, tighter analytical control should carried out once every 2 hours. The above procedures apply as of June 16th 2020 To ensure additional protection, a back-up set for the transmission of data by radio signal has been purchased, to be installed immediately in the event of a system failure.

Re 2. Schedule of actions to improve the quality of wastewater transferred from the Biological Wastewater Treatment Plant of Grupa Azoty S.A. to the Wastewater Treatment Plant of Tarnowskie Wodociągi Spółka z o.o. 1. Installation of a removal system for excess suspended solids. By the end of 2020, several systems removing excess suspended solids from wastewater transferred to the Wastewater Treatment Plant 7

of Tarnowskie Wodociągi Spółka z o.o. will have been tested. After the tests are completed , the most efficient technology for final treatment of wastewater discharged from the sedimentation tanks will be selected, on the basis of which a capital asset requisition will be submitted for the purchase and installation of a system to remove excess suspended solids. Scheduled completion: purchase and installation of the system to be completed by the end of 2021. 2. Construction of a pilot-plant unit for carrying out optimisation tests. Construction of a pilot-plant unit by the end of the fourth quarter of 2020. Following the commissioning of the pilot-plant unit (by the end of the first quarter of 2021) , tests will be carried out on the unit for at least eight months on actual wastewater streams, which will inform the optimisation concept for the currently operated facility until its upgrade. 3. Thorough upgrade of the treatment plant. By the end of the first half of 2022 , the process parameters at which optimum wastewater treatment is achieved will be determined . They will be used to inform the treatment plant upgrade project, including design of a denitrification chamber. The Biological Wastewater Treatment Plant is to be upgraded by the end of 2024.

Re 3. A meeting was held during which management staff and their subordinate employees were reminded of the obligation to immediately report any industrial accidents to the Provincial Inspectorate for Environmental Protection and the State Fire Service.

Re 4. As part of the preventive action against reocurrence of the industrial accident, the following measures have been taken : 1. Training for direct supervisors and staff concerning the incident which took place at the plant, to be refreshed during periodic training. • Completed. 8

2. Supplementing the job manual for operators of the unit for low-pressure absorption of ammonia in water with information on the procedures to be followed should a similar situation take place. • Completed by adding an annex to the NA/PA-2/33 job manual.

With regard to Re 1 and Re 2, the stage of completion as at February 2021 was as follows: Re 1. - Purchase of a back-up set for the transmission of data from the pH-meter , to be installed in the event of a system failure – fully completed. Re 2. - Installation of a removal system for excess suspended solids – to be completed through testing and selection of the best-fit technology by the Research and Development Department as part of its projects planned for 2021. Accordingly, the capital asset requisition for the purchase and installation of the target system will be submitted for 2022 after completion of the tests and selection of the technology in the current year. - Construction of a pilot-plant unit – based on our assessment of the stage of completion of the construction and assembly work, we can confirm that the declared commissioning date, set at the end of the first quarter of 2021, will be met, followed by tests to be carried out for at least eight months . - Thorough upgrade of the treatment plant – the planned completion date (by the end of 2024) has not been revised as at the date of this report.

II. Inspection Report No. TAR 159/2020 – the inspection concerned the notification submitted by Grupa Azoty S.A. pursuant to Art. 76.4 of the Environmental Protection Law regarding: 1. Completion of the start-up and commissioning of the boiler 5 slag collection unit located at the Power Centre, scheduled for July 29th 2020. 2. Completion of the start-up and commissioning of the phenol storage and distribution facility (stage 2), scheduled for 9

July 29th 2020. 3. Commissioning of the facility under the ‘Construction of a technical-grade nitric acid storage and distribution facility – stage 2 and 3’ project at the Nitric Acid Department of the Fertilizers Business Unit, scheduled for August 15th 2020.

The Provincial Inspectorate for Environmental Protection (WIOŚ) did not issue any requirement notices, but issued a decision authorising the operation of the facility.

III. Inspection Report No. TAR 190/2020 – the inspection concerned a request submitted by the Marshal of the Kraków Province to inspect the landfill site where over 3,000 Mg of waste is landfilled per year, with respect to Grupa Azoty S.A.’s compliance with the requirements set out in the relevant environmental regulations. The Provincial Inspectorate for Environmental Protection (WIOŚ) did not issue any requirement notices.

IV. Inspection Report No. TAR 202/2020 – 1. the inspection was held at the ECII CHP plant located on the premises of the Energy Business Unit with respect to the sulfur content in heavy fuel oil combusted at the plant, as well as with respect to compliance with the obligations under the integrated (IPPC) permit. The inspection also covered the Central Wastewater Treatment Plant (COŚ) and Biological Wastewater Treatment Plant (BOŚ) with regard to water and wastewater management systems.

2. With respect to prevention of major accidents, an accident report of August 26th 2020 was examined (No. RPW/13344/2020 including update No. RPW/13368/2020) concerning the release of hydrogen from outlet piping downstream of the safety valve at the phenol hydrogenation unit (K-32 unit, Cyclohexanone Department).

3. The inspection also covered Grupa Azoty S.A.’s notifications under Art. 76.4 of the Environmental Protection Law regarding: - Completion of the start-up and commissioning of the ‘Reduction of ammonia emissions in the PA_6 liquid ammonia storage and distribution facility’ project on the premises of Grupa Azoty S.A. of Tarnów, scheduled for September 30th 2020. - Completion of the start-up and commissioning of the ‘Bringing the oleum storage and 10

distribution facility into compliance with the applicable regulations, stage 1 – Z6 tank’ project, scheduled for November 16th 2020. The Provincial Inspectorate for Environmental Protection (WIOŚ) did not issue any requirement notices. Following the inspection, WIOŚ issued a decision authorising the operation of the facility.

How many inspections did you Number: Please provide details of these visits, including receive from the health and safety County number and nature of any violations found: authorities during the reporting State period? Sanitary In 2020, 10 inspections were carried out Inspector – By the National Sanitary Inspectorate (PIS), 10 ending in post-inspection reports. National Labour The inspections covered: Inspectorate a/ health conditions in the workplace, – 0 assessment of the sanitary and technical State Fire condition of the facility, and compliance Service – 2 with regulations on hazardous substances – 7 d) checking the implementation of the County Sanitary Inspector’s decisions – 3

2 decisions were issued regarding 1. occupational risk assessment – biological agents 2. hygienic and sanitary facilities.

All decisions with deadlines in 2020 were implemented.

In 2020, the State Fire Service carried out 2 inspections. 1. 1. Report on the findings of inspection and examination activities of April 24th 2020 The scope of the inspection and examination activities covered compliance with the safety requirements applicable to a lower-tier establishment or upper-tier establishment. No non-compliances with respect to fire safety and prevention of major industrial accidents were identified.

The report contained recommendations regarding the Safety Report for Grupa Azoty S.A. Grupa Azoty S.A. implemented the recommendations by submitting a revised Safety Report to the Provincial Command of the State Fire Service in Kraków in June 2020. After the recommendations had been implemented, the Commander-in-Chief of the State Fire Service in the Kraków Province, by his decision of August 26th 2020, approved the Safety Report for Grupa Azoty S.A. (version of October 2019 with an annex of June 2020).

2. 2. Report on the findings of inspection and examination activities of September 10th 2020 The scope of the inspection and examination activities concerned the incident reported on August 26th 2020 – release of hydrogen from outlet piping downstream of the safety valve at the Cyclohexanone Department of the Plastics Business Segment. The incident was not classified as a major industrial accident. No non-compliances with respect to fire safety and prevention of major industrial accidents were identified. How many inspections did you Number: 0 Please provide details of these visits, including receive from the labour authorities number and nature of any violations found: during the reporting period? In 2020, the National Labour Inspectorate (PIP) did not carry out any inspections at Grupa Azoty S.A. The administrative instructions issued in 2019, with deadlines extended by PIP’s decision until 2020, were implemented as follows:

- Instruction No. 070213-53-K007-Nk01/18/19 containing 1 decision to be implemented: Repair the inner trestle posts between the old phenol storage and distribution facility (K-35 component) and the intersection of routes E and 7, including perforated components, and protect them against corrosion, at the Cyclohexanone Department of Grupa Azoty Spółka Akcyjna.

Previous deadline – December 11th 2019 Current deadline: June 30th 2021 By letter of December 9th 2020 Ref. No. NBP/LSz/272/2020, the National Labour Inspectorate was notified of the implementation of the decision with a deadline set for June 30th 2021. The instruction has been fully implemented.

- Instruction No. 070170-5317-K0038-Nk02/18 of November 23rd 2018: Provide anti-corrosion protection on the surfaces of steel structures of trestle bridges of the methanol unloading station and the methanol storage and distribution facility, on pumps, nozzles, nitrogen pipelines, as well as on the surfaces of the structure of the pump service valve platform at the methanol storage and distribution facility.

Previous deadline for implementing the decision: September 30th 2019

Current deadline: June 30th 2021 According to information provided by the Head of the Tarnoform Department as at February 2021, the instruction will be implemented by the prescribed deadline. Have these visits resulted in any Yes [ ] If Yes, please describe, including status of penalties, fines and/or corrective No [X] implementing corrective actions to address any action plans? violations found:

No fines were imposed on the Company as a result of these inspections, but corrective measures following from the aforementioned decisions, administrative instructions and improvement notices were taken. Has the Company engaged any Yes [X] If Yes, please state for which types of work and contractors for project-related work No [ ] how the Company monitored contractors’ in the reporting period? compliance with the EBRD Performance Requirements and the Environmental and Social Action Plan:

The Company hires contractors to perform repair and maintenance work. A special procedure governs the performance of such work, including relevant permits. OHS inspections at construction sites are carried out on an ongoing basis. Were any of the violations stated Yes [X] If Yes, please provide details, including how the above the responsibility of No [ ] Company is ensuring that corrective actions are contractors? implemented by the contractor?

A few violations of safety rules and procedures were identified, consisting mainly in incorrect work routines, poor scaffolding, absence of safety devices or failure to use personal protective equipment (hard hats, gas masks). In each case, work was halted until the violations were removed. Have any operations been reduced, Yes [X] If Yes, please describe: temporarily suspended or closed down No [ ] due to environmental, health, safety Construction work was suspended for a or labour reasons? short time, pending removal of violations, without significantly affecting the progress of work. 13

Major environmental projects carried out in 2020 by Grupa Azoty S.A. included the collection of slag from the ECII CHP plant boilers. The project has enabled the use of slag to produce building materials, helping reduce the amount of landfilled boiler bottom waste. In 2020, a number of projects were pursued by Grupa Azoty S.A. to reduce the consumption of energy carriers in production processes and make more efficient use of available resources. Key projects in this area included ‘Construction of a turbo generator set using steam from sulfuric acid unit and dual- pressure nitric acid unit, and 4 MPa steam pipeline from sulfuric acid unit to dual-pressure nitric acid unit’, as well as ‘Upgrade of heating water network’. Other important environmental projects at GA S.A. in 2020 involved bringing the Company’s heat and power generation activities in line with the more stringent environmental requirements resulting from BAT conclusions. Following the construction of a new phenol storage and distribution facility in 2020, phenol emissions into the air from the Phenol-Derived Cyclohexanone unit in the Plastics Business Segment were significantly reduced.

The Company’s OHS activities in 2020 focused mainly on mitigating the risk of infections among staff. A number of safety procedures were established, including mechanisms to reduce physical contact between employees, provision of disinfectants, protective face masks and temperature measuring devices, as well as COVID-19 diagnostic testing in certain situations.

Please indicate the level of associated expenditure (capital expenditure and operating expenditure), and whether this relates to the requirements of the Environmental and Social Action Plan, or to any other initiative:

The expenditure incurred by Grupa Azoty S.A. in 2020 on its environmental projects was PLN 25,744 thousand.

3. Status of the Environmental and Social Action Plan Please provide information on the status of each item in the Environmental and Social Action Plan (ESAP) agreed with EBRD. If the ESAP was updated during the reporting period, please attach a copy of the new plan.

See attachments for information on the implementation of ESAP.

4. Environmental Monitoring Data for each of the key subsidiaries

The information required in this section can be extracted from a CSR report, or a full CSR report can be attached.

Please provide the name and contact Krzysztof Chmura, details for your environmental manager: Telephone: (+48) 14 637-36-67 Parameter2 Amount3 Unit Compliance Status4 Comments5 Wastewater Total wastewater 3,236 ‘000 m3 Compliant Biochemical 10,091 kg Compliant Oxygen Demand (BOD5) Chemical Oxygen 28,112 kg Compliant Demand (COD) Suspended solids 20,620 kg Compliant Phosphorus 535 kg Compliant Nitrates 64,963 kg Compliant Heavy metals 624 kg Compliant [Other] 14

Air Per each Mg/2020 emissions major point source CHP Plant: NE/EPK/3 204 NE/EPK/2 79 Sulfuric Acid SO Compliant 2 Plant NK/KPH/175 81 Hydroxylamine sulfate NK/KPH/185 44 CHP Plant: NE/EPK/3 177 NE/EPK/1 42 Dual pressure nitric acid Compliant NA/PN-1/20 222 Synthesis Gas Unit Nitrogen oxides NA/PN-2/77 76 (NO ) in NO X 2 Hydroxylamin equivalent e sulfate NK/KPH/185 550 Ammonium nitrite Non-compliant

NK/KPH/163 584 NK/KPH/164 608 NK/KPH/165 646 NK/KPH/169 1,837 CHP Plant: NE/EPK/1 8 Fertilizers NA/PN-3/48 38 NA/PN-3/49 16 NA/PN-3/51 7 Particulates NA/PN-3/105 16 Compliant NA/PN-3/112 9 NA/PN-3/139 6 NA/PN-3/140 15 NA/PN-3/29- 46 37 CHP Plant 439,258 Production 456,028 units in ETS CO2 Compliant Production 33,353 units outside ETS Other parameters 15

Noise emissions 45 – night dB Non-compliant Measuremen 55 – day ts taken around the Company premises showed nigh-time exceedance at one location. Excessive noise emissions come from the area of Methane Decompositi on Plant V. Thorough noise tests were carried out, and the Company has taken measures to reduce noise emissions. [Other] Total waste 40,899.68 including: 10 01 15 Bottom ash 16,736.5 Compliant Recovery and slag 10 01 02 Fly ash 19,420.88 Compliant Recovery

17 04 05 Iron and steel 1,307.08 Compliant Recovery

17 06 04 Insulation 237.84 Compliant Disposal materials 13 02 08 * Other engine, 18.96 Compliant Recovery gear and lubricating oils 19 08 14 Sludge from 1,421.94 Compliant Recovery non-biological treatment of wastewater 19 08 12 Sludge from 1,214.78 Compliant Recovery biological treatment of wastewater 07 02 13 Waste plastic 70.44 Compliant Recovery

17 02 01 Wood 0.12 Recovery

15 01 03 Wooden 177.635 Compliant Recovery packaging 15 01 02 Plastic 92.679 Compliant Recovery packaging 16

Please provide details of the types and amounts of solid wastes generated by the project. Indicate where wastes are classified as hazardous. Indicate the final re-use, recycle or disposal method for each waste type.

5. Resource Usage and Product Output

Measurement Parameter Amount Comments6 Unit Fuels used Liquid fuels Mg Consumption at the Power Business 424.5 Unit (mazut) Gas fuels m3 Consumption at the Power Business 623,144 Unit (methane for the EC II CHP plant) Crude oil 0 Natural gas 234,954,000 m3 Hard coal 189,209 Mg Lignite 0 Electricity 438,303 MWh GA S.A. consumption excluding auxiliary consumption by EC2 (EC2 auxiliary consumption: 45,670.6 MWh) Heat purchased 0 from external sources Feedstocks and raw materials used Ammonia 328,454 Mg Dolomite 52,368 Mg Benzene 0.00 Mg

Phenol 84,179 Mg Technical-grade Mg methanol 9,969 Liquid sulfur 119,763 Mg Product output Caprolactam 100,600 Mg Polyamide 109,380 Mg Ammonia 223,181 Mg Technical-grade 350,945 Mg nitric acid Total fertilizers 1,063,549 Mg

6. Human Resources management Please provide the name and contact details for Krzysztof Pabian your Human Resources manager: (+48) 14 637 3131 Recruited in this Terminated in this Total reporting period reporting period Number of direct employees: 2,218 106 85 Number of contracted - - - workers: 17

Were there any collective Yes [ ] If Yes, please describe the redundancy plan, redundancies during the reporting No [X] including reasons for redundancies, number of period? workers involved, how they were selected, consultation undertaken, and measures to mitigate the effects of redundancy: Are any redundancies to the Yes [ ] If Yes, please describe the redundancy plan, workforce planned for the next No [X] including reasons for redundancies, number of year? workers involved, and selection and consultation process: Were there any changes in trade Yes [X] If Yes, please provide details, and summarise union representation at Company No [ ] engagement with trade unions during reporting plants during the reporting period: period? There were changes in the positions of Chairperson and Deputy Chairperson of the Continuous Production Workers Trade Union. Were there any other worker Yes [ ] If Yes, please provide details and summarise representatives (e.g. in the No [X] engagement with them during the reporting period: absence of a trade union)? Were there any changes in the Yes [X] If Yes, please provide details: status of Collective Agreements? No [ ] Have employees raised any Yes [ ] If Yes, please state how many, split by gender, grievances with the project during No [X] summarise the issues raised in grievances by male the reporting period? and female staff and explain how the Company has addressed them:

Have employees raised any Yes [X] If Yes, please state how many, split by gender, complaints about harassment or No [ ] summarise the issues raised by male and female bullying during the reporting staff and explain how the Company has addressed period? them:

One case of workplace bullying was reported in 2020. Have there been any strikes or Yes [ ] If Yes, please summarise nature of, and reasons for, other collective disputes related No [X] disputes and explain how they were resolved: to labour and working conditions at the Company in the reporting period? 18

Have there been any court cases Yes [X] If Yes, please summarise the issues contested related to labour issues during the No [ ] and outcome: reporting period? In 2020, 6 court proceedings were in progress, including: • Proceedings involving a claim for payment under a non-compete obligation after the termination of employment. Value of the claim: PLN 210,000.00. The case is pending. • Proceedings seeking the declaration of a contract termination notice as ineffective. We are currently expecting the service of process. The case is pending. • Conciliation procedure concerning payment of PLN 313,314.00 in remuneration. The parties made a settlement. • There was one call for a conciliation hearing in a case concerning annual bonus payment. Value of the claim: PLN 42,740.28. The parties have not reached a settlement. • Proceedings involving a claim for payment of remuneration for overtime work. Value of the claim: PLN 37,827.00. The case is pending. • Proceedings concerning payment of damages by an employee to GA S.A. Value of the claim: PLN 38,427.83. The case is pending. Have there been any changes to Yes [X] If Yes, please give details, including of any new the following policies or terms No [ ] initiatives: and conditions during the reporting period in any of the January 2020 – increase in base pay and allowances. following areas: − Trade union recognition − Collective Agreements − Non-discrimination and equal opportunities for all − Equal pay for equal work − Gender equality − Bullying and harassment, including sexual harassment − Employment of young workers under 18 − Wages and salaries (for regular and overtime hours) − Overtime − Working hours − Flexible working / work-life balance − Grievance mechanism for workers − Health & safety

7. Occupational Health and Safety Data Please provide the name and Andrzej Grobecki contact details for your Health (+48) 14 637 4081 and Safety manager: Direct Contracted Direct Contracted employees workers employees workers Number of man- 3,603,600 - Number of 0 - hours worked in fatalities 7: this reporting period: Budget spent on PLN 2,652 Number of 0 - OHS in this period thousand disabling (total amount and injuries: currency): OHS training 392 training - Number of Lost 12 - provided in this sessions Time Incidents period in person- – 3,562 person- (including days: days vehicular): Number of lost 661 - Number of cases 0 - workdays of occupational resulting from disease: incidents: Number of sick 24,157 - days: Causes of accidents at work (inattention, poor concentration, lack of clear guidelines on how to perform work / bad organisation of work, technical issues). Accident types: • Accidents during transport/movement, including traffic accidents – 4 • Technical, technological and mechanical hazards – 5 • Hazardous substances (chemical and thermal burns) – 2 • Traffic accident – 1 Please provide details of any fatalities or major accidents that have not previously been reported to EBRD, including total compensation paid due to occupational injury or illness (amount and currency): There were no such accidents. Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period:

Grupa Azoty S.A. employees receive emergency prevention and response training as part of periodic OHS training. The Company Fire Brigade also runs emergency prevention and response training as part of employee induction and periodic training programmes, as well as drills under the Internal Rescue Operation Plan. 20

Please summarise any emergency response exercises or drills that have been carried out during the reporting period:

1.1 On-site drills to test the procedures of the Internal Rescue Operation Plan for Grupa Azoty S.A., involving the managers and staff of the respective Departments as well as the Departmental Rescue Teams. On-site drills at facilities classified as ZL Year Number of on-site drills (posing hazards to humans) Planned Completed Planned Completed 2018 18 18 8 8 2019 26 26 0 0 2020 28 15 9 0 The difference between planned and actually completed drills resulted from the COVID-19 pandemic in 2020. The purpose of the drills was to improve collaboration of the Company Fire Brigade teams with the managers of Departments, Centres, Production Units, GA Dispatcher, Departmental Rescue Teams, staff and support personnel operating on the Company’s premises during a fire or an accident. 1.2 Upper-Tier Establishment drills Pursuant to the Environmental Law of April 27th 2001, as amended: Art. 261.3. The operator of an upper-tier establishment is required to: review and organise drills of the internal rescue operation plan at least once every three years, to update the plan and introduce any necessary changes; in particular, account should be taken of any changes made to process units, the operation of fire safety teams, the state of knowledge regarding prevention, counteracting and removal of the effects of industrial accidents, as well as scientific and technical progress. The most recent drills on the premises of GA S.A. took place in 2017. Drills intended to test the Internal Rescue Operation Plan at the ammonia storage and distribution facility with the involvement of State Fire Service units were planned for 2020, but no on-site drills were organised due to COVID-19. However, on December 7th 2020 application drills were carried out for the ammonia storage and distribution facility via the Teams platform. Application drills are also planned for the first quarter of 2021 at the Cyclohexanone Department of the Plastics Business Segment, Plastics Production Unit. 1.3 Drills at ZL facilities

Due to the epidemic, no planned drills at ZL facilities (classified as posing hazards to humans) took place in 2020. These drills will be carried out this year, in accordance with the schedule for 2021. 1.4 Drills under the High-Risk Goods Plan in rail transport

Two such drills were carried out in 2020.

• January 22nd 2020 – unloading station for tankers with liquid SO2 on track No. 34. The drill involved the Company Fire Brigade, JRCh staff – station operators, and Koltar Sp. z o.o. staff

August 26th 2020 – side track No. 55 on the western side of GA S.A.’s premises The drill involved the Company Fire Brigade, Koltar Sp. z o.o. staff, Infrastructure Centre staff, and GA S.A. Dispatcher.

8. Stakeholder Engagement Please provide the name and contact details Piotr Pawlina for your external relations or community Head of the Communication Office engagement manager: Email: [email protected]

Grupa Azoty maintains ongoing contact with the local community, keeping it informed of current developments in its operations. Grupa Azoty communicates with its stakeholders in various ways, including: • Press briefings and/or press releases and/or study visits by journalists at the Group’s major project sites. These measures are intended to maximise the Group’s media coverage, keeping local communities up to date with Grupa Azoty S.A.’s activities (through countrywide, local and trade media). • Also, through additional publications commissioned as sponsored articles, the Company informed the public of important matters/projects related to: investment in its key business areas, including Polimery Police, its flagship business growth project, as well as research, development and innovation activities, including in new business segments. Furthermore, the Company representatives are open to give interviews and never leave journalists’ questions unanswered. • Running an intranet site and the grupaazoty.com website. The website content includes all material information on Grupa Azoty, its product portfolio, management systems etc. The intranet site, on the other hand, is continually adapted to meet employee needs, with new sections added. The content is updated on a daily basis, and so are the event calendar and photo gallery. • Publication of the corporate Grupa Azoty Magazine, covering topics such as: information on and interviews concerning Grupa Azoty; information on and interviews concerning the Company’s environment and connected with its CSR policy; culture; sports; employee- related and other matters. The magazine is addressed to both Grupa Azoty's and the Group's employees and external institutions. The Grupa Azoty Magazine is a source of information, education and entertainment, covering current affairs at the parent and subsidiaries. It is distributed mainly within the Group, but is also sent out to partner institutions, Members of Parliament from the Tarnów region, representatives of the city and county authorities, and certain retired employees. In 2020, 11 issues of the magazine were published; • Internal broadcasting system, airing programmes three times a day on each business day (Monday through Friday) at the following times: 6.45-7.30 AM; 10.00-10.15 AM; 2.45-3.10 PM. The broadcasts cover the most important information on Grupa Azoty and its environment. In 2020, the system aired the Company’s programmes and announcements, trade union and employee announcements, and thematic programmes about Grupa Azoty’s activities. Information delivered to representatives of the local community and other stakeholders in the reporting period included information on environmental protection, social policy, support to the local community (education, culture, sports), support of local development, and safety- related matters.

Grupa Azoty is a co-organiser and/or partner of conferences on environmental protection and safety. In 2020, the Company was involved in the organisation of the ‘Industrial Plant Safety’ Scientific and Technical Conference, among other events. In addition, Grupa Azoty is a Strategic Partner of the Safe Chemicals Programme run by the Polish Chamber of Chemical Industry. The conferences provided a platform for meeting chemical safety experts, sharing experience and developing solutions that can be used at the Grupa Azoty plants.

Membership in associations Grupa Azoty is a member of several dozen business, chemical industry and scientific associations and institutions. In 2020, these included:

1. Związek Pracodawców Business & Science Poland (Business & Science Poland Union of Employers) 2. Polska Izba Przemysłu Chemicznego (Polish Chamber of Chemical Industry − PIPC) 3. Fertilizers Europe 4. IFA (International Fertilizer Industry Association) 5. European Phosphate Fertilizer Alliance (AEEP) 6. Izba Energetyki Przemysłowej i Odbiorców Energii (Polish Chamber of Industrial Power and Energy Consumers) 22

7. Konsorcjum Bezpieczeństwo Gospodarcze Polski (Polish Economic Security Consortium) 8. Stowarzyszenie Emitentów Giełdowych (Polish Association of Listed Companies) 9. EPCA (European Petrochemical Association)

10. Stowarzyszenie Eksporterów Polskich (Association of Polish Exporters) 11. Instytut Audytorów Wewnętrznych Polska (Institute of Internal Auditors Poland) 12. Internationaler Controller Verein – Akademia Controllingu Sp. z o.o.) 13. Transparency Register 14. System pomocy w transporcie materiałów niebezpiecznych SPOT (SPOT System of Assistance in Hazardous Material Transport) 15. Forum Liderów Bezpiecznej Pracy (Forum of Safe Work Leaders) 16. Związek Przedsiębiorców i Pracodawców (Association of Entrepreneurs and Employers) 17. Towarowa Giełda Energii S.A. (Polish Power Exchange) 18. Towarzystwo Obrotu Energią (Energy Trading Association) 19. Naczelna Organizacja Techniczna – Federacja Stowarzyszeń Naukowych-Technicznych (Polish Federation of Engineering Associations NOT), Tarnów Division 20. Polish-Brazilian Chamber of Commerce 21. Stowarzyszenie Elektryków Polskich (Association of Polish Electrical Engineers), Management Board of the Tarnów Division 22. Izba Przemysłowo – Handlowa w Tarnowie (Tarnów Chamber of Commerce and Industry) 23. Polskie Forum ISO 9000 (Polish ISO 9000 Forum) 24. Stowarzyszenie Inżynierów i Techników Przemysłu Chemicznego (Polish Association of Chemical Engineers) 25. Klub Polskich Laboratoriów Badawczych POLLAB (POLLAB Club of Polish Research Laboratories) 26. Stowarzyszenie Księgowych w Polsce (the Accountants Association in Poland) 27. Stowarzyszenie Polskich Skarbników Korporacyjnych (Association of Polish Corporate Treasurers) 28. Polska Izba Rzeczników Patentowych (Polish Chamber of Patent Attorneys) 29. Komitet Chemii Polskiej Akademii Nauk (Chemistry Committee of the Polish Academy of Sciences) 30. Centrum Zaawansowanych Technologii przy Instytucie Chemii Przemysłowej (Advanced Technology Centre at the Industrial Chemistry Institute) 31. Stowarzyszenie Inspektorów Ochrony Danych (Data Protection Officers’ Association) – SABI 32. Zachodniopomorski Klaster Chemiczny „Zielona Chemia” (‘Green Chemistry’ West Pomerania Chemical Cluster) 33. CEFIC (European Chemical Industry Council) 34. ISSA (International Security Systems Association) 35. Klub Sportowy Azoty-Puławy (Azoty-Puławy Sports Club) 36. Lubelski Klaster Biotechnologiczny „LKBio” (‘LKBio’ Lublin Biotechnology Cluster) 37. Puławskie Centrum Przedsiębiorczości (Puławy Entrepreneurship Centre) 38. Polska Izba Odzysku i Recyklingu Opakowań (Polish Chamber of Packaging Recovery and Recycling) 39. Rada Gospodarki Wodnej Regionu Wodnego Dolnej Odry i Przymorza Zachodniego (Council for Water Management in the Lower Oder and Western Coast Water Region) 40. ECPI (European Plasticizers) 41. EPL 42. Krajowa Sieć Informatyczna Europejskiej Agencji Bezpieczeństwa i Zdrowia w Pracy (National IT Network of the European Agency for Safety and Health at Work) 43. Staszowska Izba Gospodarcza (Staszów Chamber of Commerce) 44. Staropolska Izba Przemysłowo - Handlowa (Staropolska Chamber of Industry and Commerce) 45. HTRI (Heat Transfer Research INC.) 46. Izba Gospodarcza Gazownictwa (Chamber of the Natural Gas Industry) 47. Stowarzyszenie Doradców ds. Bezpieczeństwa Przewozu Towarów Niebezpiecznych Koleją (Association of Advisers for Safe Transport of Dangerous Goods by Rail) 48. Izba Gospodarcza Transportu Lądowego (Land Transport Commercial Chamber) 49. GCU Bureau Sprl (General Contract of Use for Wagons) 50. VPI – Verband der Guterwagenhalter in Deutschland E.V. 23

51. Stowarzyszenie Inżynierów i Techników Przemysłu Chemicznego (Polish Association of Chemical Engineers) 52. Polskie Stowarzyszenie Myjni Cystern (Polish Tank Cleaning Association) 53. Zachodniopomorska Okręgowa Izba Inżynierów Budownictwa (West Pomeranian Regional Chamber of Civil Engineers)

Grupa Azoty carries out a number of community-oriented projects to engage with its stakeholders. Due to the pandemic, these activities were largely limited in 2020. However, among the few events that were organised was the ‘Arbour Day with Grupa Azoty S.A.’ environmental and educational campaign. During the event, the Company’s employees and students from the Tarnów-Mościce Technical School Complex planted several dozen trees around the plant’s buildings. The idea of planting trees on the premises of Grupa Azoty S.A. is the Company’s response to the problem of global warming and is intended to draw attention to the important role industrial sector companies play in counteracting global warming. As a socially responsible corporate citizen, Grupa Azoty promotes all efforts contributing to the improvement of Poland’s ecological system, recognising that trees and forests are an essential element of climate regulation, as they absorb carbon dioxide, being the main cause of global warming.

How many complaints or grievances did the project receive from members of the public or civil society organisations during the reporting period? Please split by stakeholder group. Summarise any issues raised in the complaints or grievances and explain how they were resolved:

In the period under review, no complaints were raised by the local community.

9. Community Development Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure:

In 2020, Grupa Azoty S.A.’s expenditure on CSR projects benefiting the local community amounted to ca. PLN 550,000.00.Through these activities, which include educational, cultural and sports projects, the Company supports the local community and the region, thus building and promoting its perception as a valued and respected partner. Thanks to such efforts, the Company also builds stronger and lasting relations with its immediate social environment.

Development of the region In 2020, Grupa Azoty S.A. participated in initiatives for the development of the region and its community, supporting such institutions as: • Polish Tourist Association Branch at Grupa Azoty S.A. in Tarnów-Mościce • KANON Association • Social Initiatives Association • ‘Linking Foundation’ for the Support of Local Ties • Ignacy Mościcki Foundation of Tarnów • Towarzystwo Przyjaciół Mościc (Society of the Friends of Mościce).

Development of education

Grupa Azoty S.A. has a long-standing commitment to promoting the local community development, which is delivered through various educational activities, campaigns and programmes designed to support children and young people in pursuing their interests, improving their skills and acquiring new knowledge in such fields as environmental protection. Last year, Grupa Azoty S.A. worked in partnership with schools from the Tarnów region, including the Technical School Complex in Tarnów.

Grupa Azoty S.A. intends to continue that cooperation on a long-term basis. To this end, it has signed an agreement with the Ignacy Mościcki Technical School Complex, under which the Company 24

is to employ up to ten students yearly, provide apprenticeship opportunities, help prepare classes and organise educational field trips, and offer support in applying for EU funds.

Grupa Azoty S.A. also actively collaborates with scientific institutions and academic centres. For decades, the Company has not only supported research into industrial technologies and techniques, but has also been actively involved in the organisation of educational projects linking students with industry. Development of sports Driven by the belief that universal access to sports – through respect for human dignity and the spirit of fair play – is not only a foundation of proper education of children and youth but also eliminates the threats posed by contemporary social ills, Grupa Azoty undertakes initiatives supporting stakeholders who are active in this area.

In building the strength of its brand, Grupa Azoty supports Poland’s best sports people. In an effort to help satisfy the needs of the local community, it supports not only professional but also amateur sports people and organisations, which in 2020 included: • Grupa Azoty PWSZ Tarnów Club (volleyball) • Stowarzyszenie Piłki Ręcznej Tarnów (handball) • ZKS Unia Tarnów Sports Club (football, futsal), • Unia Tarnów Żużlowa Sportowa Społka Akcyjna (speedway).

Development of culture Believing that culture is an invaluable social phenomenon and an integral system within the process of education, which stimulates imagination, sensitivity and creativity of successive generations and plays a significant role in shaping both individual and national identity, Grupa Azoty undertook the following initiatives: • organisation of cultural events and workshops promoting respect for the national and cultural identity, • support of cultural projects and programmes promoting both the region and national culture.

To this end, in 2020 Grupa Azoty supported a number of entities, including: • ArtContest Artistic Association of Tarnów (Grupa Azoty International Jazz Contest), • Paderewski Centre in Kąśna Dolna

Protection of life and health The Company is aware of the need to undertake initiatives for human health and life, help the suffering, sick and terminally ill, as well as those deprived of opportunities for development and unable to function on their own in society. For this reason, in 2020 Grupa Azoty S.A. provided support to, among other beneficiaries, Club of Polish Red Cross Honorary Blood Donors at Grupa Azoty S.A.

To combat the spread of SARS-CoV-2, Grupa Azoty S.A. lent its support to the following organisations: 1. Healthcare Complex in Dąbrowa Tarnowska – in-kind donation (protective equipment); 2. Edward Szczeklik Specialist Hospital in Tarnów – financial donation for the purchase of medical and protective equipment; 3. Independent Public Healthcare Complex in Brzesko – financial donation for the purchase of medical equipment; 4. Edmund Biernacki Specialist Hospital in Mielec – financial donation for the purchase of medical equipment; 5. Independent Public Healthcare Centre in Bochnia – Blessed Marta Wiecka County Hospital – financial donation for the purchase of medical equipment. Additionally: • The Research and Development Centre of Grupa Azoty in Tarnów began the production of antiviral gloves. The ‘safety glove’ is impregnated with silver, a material which has been long and widely used to fight viruses and bacteria; • The R&D Centre also joined the #DrukarzeDlaSzpitali (#PrintersForHospitals) initiative and donated Tarfuse 3D printing filaments to make protective shields and goggles for hospitals. 25

• Filaments were also donated to support the project to build @VentilAid, Poland’s first ventilator. This open source project is being carried out by Polish engineers and designers sharing documentation of a ventilator that can be made anywhere using a 3D printer and basic parts.

In 2020, the amount donated by the Company was approximately PLN 1,062,000.00

ENVIRONMENTAL AND SOCIAL ACTION PLAN

Table 0.1 Wisła Project, Grupa Azoty Poland – Environmental, Social, Health and Safety (ESHS) matters, Updated (Alchemist Project) Action Plan:

GRUPA AZOTY S.A.

No. Action Environmental risks, Legislative Requirement/ Scheduled Target and Comments liabilities/benefits requirements/B Resources completion – evaluation criteria est practice action to be for implementation completed by progress end of year 0. General − Management, Environmental, and OHS matters – management at the corporate level of Grupa Azoty 0.1 Develop and implement a new EHS performance monitoring, Best practice, Internal Ongoing; Conduct operations The resulting management structure, maintaining minimum EHS risk the Bank's resources Please provide in line with Polish new structure including EHS matters, as part at corporate level Performance update in the and EU will be of the merger of the Grupa Requirements annual report. requirements and presented in an Azoty and Puławy Groups (“PRs” or follow the Bank's appropriate “Performance PRs (particularly 1, internal Requirements”) 2, 3 and 10) executive order (1, 2, 3 and 10) of the Group management Information: Grupa Azoty S.A. pursues a Corporate Management Policy which guarantees that the Company's strategic goals are achieved in reliance on an integrated management system, consistent with international standards.The operating priorities: high quality and care for technical safety and the environment, are all efficiently monitored and facilitate effective management of the Company. The Integrated Management System is structured around the following principles assuming giving priority to customers, reducing environmental losses and mitigating the risk of hazards, and continuous improvement. The management systems are based on the concept of continuous improvement by: • establishing a policy, • action planning to implement the policy; • creating conditions for the implementation of planned actions; • verifying the results of the activities, • improvement based on periodic assessments of performance. The Corporate Management Policy sets out plans and principles for the Company’s operations at large, providing a framework for setting and reviewing strategic goals in quality, environmental protection, workplace health and safety, and food safety.

The Grupa Azoty Group is an international corporation integrating European chemical sector companies, with its own research, development, logistics and technical facilities. The parent of the Group, responsible for its strategy and corporate governance, is Grupa Azoty S.A. Corporate governance at the Grupa Azoty Group is guaranteed by the exercise of powers of the corporate governing bodies of Grupa Azoty S.A.: the General Meeting, the Supervisory Board, and the Management Board. The Grupa Azoty Group consolidation process has created potential for further gains. In order to ensure more effective management of the Group, a system of management by business segments has been implemented. In line with the model’s assumptions, functions offering the strongest synergies are centralised and main processes are managed at the Group level, with the identities of Grupa Azoty Group companies preserved. At present, Grupa Azoty has a management model based on a process-based division of responsibilities and remits within the Group’s Management Board. The current management model ensures delivery of the Grupa Azoty Group’s Strategy, achievement of synergies, as well as efficient and effective decision making by the Grupa Azoty Management Board, while preserving the identities of the subsidiaries. The pillars of the current management framework are process leaders (individual members of the Grupa Azoty Management Board responsible for their respective processes), defined decision paths, decision-making transparency, and an incentive scheme, which ensure direct delivery and communication of the developed strategy and strategic objectives. Members of the Grupa Azoty Management Board are process leaders with uniform decision-making powers to prepare organisational and HR decisions (appointments and target setting), which are then approved by the Grupa Azoty Management Board or the management boards of subsidiaries. The President of the Management Board of Grupa Azoty S.A. exercises overall supervision of the Group at the corporate level. In its management of the Group and supervision of the business segments and support functions, the Grupa Azoty Management Board is supported by the Grupa Azoty Council, standing advisory and consultative committees, process and project steering committees, as well as Corporate Departments and Offices, and tiered decision-making positions. Under the management model rolled out at the Grupa Azoty Group, key corporate processes are managed at the Group level. The model adopted for the Grupa Azoty Group’s structure and governance envisages an interdependent management system based on a configuration of the organisational structure and process-based structure consisting of identified processes.

The functioning of the management model of the Grupa Azoty Management Board and of the subsidiaries’ management boards is further reinforced by the following principles adopted at the Group: − the Grupa Azoty Group management model provides for preserving the subsidiaries' identities, locations and legal autonomy; − the Grupa Azoty Group management model provides for centralising functions offering the strongest synergies, economies of scale, and specialisation; − the Grupa Azoty Group management model provides for centralising functions offering the strongest synergies, economies of scale, and specialisation; • the Grupa Azoty Group operates as a single entity based on its four key companies; • members of the Grupa Azoty Management Board – the leaders of main corporate processes – ensure joint operation to achieve strategic and financial objectives of the Grupa Azoty Group by driving the effects of business processes at the Group; • at the Grupa Azoty Group, opinions of the management boards of Group subsidiaries are taken into account when making decisions with a material effect on the subsidiaries' financial performance; if no agreement can be reached between a process leader and the subsidiaries’ management boards, the decision is made by the Grupa Azoty Management Board; • all activities and decisions at the Group are transparent to all parties involved.

Below is presented a description of the actions and initiatives related to the implemented management model, which are taken or conducted as part of the consolidation process with respect to a number of organisational, formal and legal aspects.

Formal and legal aspects: • Preparation and implementation of Internal Audit Standards for Grupa Azoty and Grupa Azoty S.A. Internal Audit Rules; • Preparation and implementation of the Financial (Currency and Interest Rate) Risk Management Policy for the Grupa Azoty Group; • Preparation and implementation of the Strategy of Technical Maintenance and Asset Life Cycle Management at Grupa Azoty;

• Preparation and implementation of a joint model for managing CO2 emission allowances at the Grupa Azoty Group; • Preparation and implementation of the Framework Procedure for Disposal of Perpetual Usufruct Rights, Ownership Rights to Real Property, or Interests in Such Rights, at the Grupa Azoty Group Companies; • Preparation and implementation of the Financing and Liquidity Management Policy for Grupa Azoty; • Preparation and implementation of a procedure to be followed in the event of an inspection by the Polish Office of Competition and Consumer Protection (UOKiK) or the European Commission at Grupa Azoty; • Preparation and implementation of the Uniform Procurement Regulations at the Grupa Azoty Group; • Preparation and implementation of a document drafting policy for related-party transactions at the Grupa Azoty Group; • Preparation and implementation of guidelines on submitting investment plans and preparing investment projects at the Grupa Azoty Group Companies; • Preparation and implementation of methodology assumptions for project efficiency analysis at Grupa Azoty; • Preparation and implementation of guidelines for the allocation of umbrella facility sublimits between Grupa Azoty Group companies; • Preparation and implementation of the credit risk management instruction at the Grupa Azoty Group; • Preparation and implementation of the Information Policy at Grupa Azoty; • Preparation and implementation of the Vehicle Fleet Management Rules at the Grupa Azoty Group; • Preparation and implementation of document forms relating to the processing of personal data in accordance with the applicable laws (e.g. GDPR); • Preparation and implementation of compliance management related policies, i.e. the Anti-Corruption Code, the Conflict of Interest Policy and the Whistleblowing Policy; • Preparation and implementation of the Grupa Azoty Register of Corporate Risks and List of Key Risks; • Preparation and implementation at Grupa Azoty S.A. of the ‘Grupa Azoty Gift Policy’; • Preparation and implementation of the ‘Regulations concerning obligations under the EMIR regime and collection of transaction data’; • Preparation and implementation at Grupa Azoty S.A. and its subsidiaries of the Code of Conduct for Business Partners; • Preparation and implementation of the Grupa Azoty Group Contracting and Contract Performance Manual; • Preparation and implementation of the Rules of operation for the ICT function at Grupa Azoty; • Preparation and implementation of the Grupa Azoty Group Communication Policy; • Preparation and implementation of the CSR Policy for Grupa Azoty Group companies; • Preparation and implementation of the Information Policy at Grupa Azoty. Organisational aspects: • Establishment of the Corporate Risk Management Office and Personal Data Protection Office within the organisational structure; 29

• Establishment of the positions of Compliance Management Manager and Management Board Assignee for MIFID II within the organisational structure; • Establishment of the standing Finance Committee at Grupa Azoty; • Establishment of the Procurement Committee at Grupa Azoty; • Increase in the number of members of the Risk Management Process Steering Committee and expansion of the concept for implementing the enterprise risk management process at other Companies (Grupa Azoty Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A., Gdańskie Zakłady Nawozów Fosforowych Fosfory Sp. z o.o., Zakłady Azotowe Chorzów S.A.); • Establishment of the Corporate Energy Team at the Grupa Azoty Group; • Establishment of the Personal Data Protection Team at the Grupa Azoty Group; • Establishment of the Explosives Precursors Corporate Team at the Grupa Azoty Group; • Establishment of the ICT Steering Committee; • Establishment of the Security Steering Committee and the Information Security and Protection Team at the Grupa Azoty Group; • Establishment of project structures for the ‘Implementation of General Data Protection Regulation (GDPR) at the Grupa Azoty Group’ project; • Establishment of the AGRO Task Team; • Establishment of the Ammonium Nitrate Anti-dumping Team; • Establishment of the Team for the Implementation of MIFID II at Grupa Azoty Group Companies; • Establishment of the Ammonia Management Team; • Establishment of the Working Group for implementation of an IT tool to support tender and procurement processes at Grupa Azoty Group Companies (electronic procurement platform); • Approval of a new Organisational Model for the Plastics Business Segment. 30

0.2 As part of new EHS Following completion of the EBRD PR 1 and Internal Completed Regular management structure – merger, the Company will best practice resources certification of maintain and further develop maintain EHS management EHS existing EHS management systems and develop such management systems (such as ISO 14001, systems throughout Grupa systems OHSAS 18001, etc.); by 2015 Azoty, both at the Group and develop and implement subsidiary levels. Objective: energy management systems obtain ISO 51001 for the Group in line with ISO The Company will also address certification in 51001. energy efficiency at the 2015 Group and subsidiary levels, The target is to achieve a 10% and implement an energy energy intensity reduction by management system to 2016 compared with 2012, reduce energy intensity with a long-term objective of through BAT (Best Available a 15% reduction. Technology) implementation and to reduce carbon dioxide emissions. Information: The Grupa Azoty Group Companies have implemented and maintain management systems based on international standards. In addition to quality, environmental, and OHS management systems, some of them have in place an energy management system, food safety management system and laboratory quality management systems. The companies covered by this report have implemented and maintain management systems and hold certificates issued by the relevant certification bodies, confirming compliance with the requirements of the standards listed below, in particular the specified EHS standards: Grupa Azoty S.A.: − Quality Management System conforming to the ISO 9001 standard, − Environmental Management System conforming to the ISO 14001 standard, − Energy Management System conforming to the ISO 50001 standard, − Food Safety Management System conforming to the ISO 22000 standard, − Occupational Health and Safety Management System conforming to the BS OHSAS 18001 standard, − Automotive Industry Quality Management Standard implemented in accordance with the IATF 16949 standard, − PN-EN ISO/IEC 17025 Management System (general requirements for the competence of testing and calibration laboratories), − Product Stewardship Management Standard, − Enterprise Risk Management System, − Information Security Management System conforming to the ISO/IEC 27001 standard. In keeping with the leading governance standards globally, Grupa Azoty S.A. has implemented an energy management system in line with the requirements of the ISO 50001 international standard. Informed energy management and energy efficiency improvement are important aspects of 31

Grupa Azoty’s operations. To ensure high quality and safety of its operations, the relevant management systems have been deployed and strict procedures have been adopted. The systems implemented by the Grupa Azoty Group companies include: − Quality Management System conforming to the ISO 9001 standard, − Environmental Management System conforming to the ISO 14001 standard, − Energy Management System conforming to the ISO 50001 standard, − Occupational Health and Safety Management System conforming to the BS OHSAS 18001 and ISO 45001 standards, − PN-EN ISO/IEC 17025 Management System (general requirements for the competence of testing and calibration laboratories), − Food Safety Management System conforming to the ISO 22000 standard, − Automotive Industry Quality Management Standard implemented in accordance with the IATF 16949 standard, − Product Stewardship Management Standard, − Enterprise Risk Management System. For more information, see the websites of individual Grupa Azoty Group companies. In 2020, external audits were carried out at Grupa Azoty Group Companies by the relevant certification bodies. The audit findings were positive, supporting extension of the validity of the respective certificates. 32

0.3 As part of EHS management, EHS performance monitoring, Best practice, Internal Ongoing; to be Annual financial The result/new the Company will develop its maintaining minimum EHS risk Bank's PRs resources completed by report with clear system presented in own procedure for assessing at corporate level the end of estimation of an appropriate EHS provisions and contingent 2015. potential internal executive liabilities to enable: The system will then be extraordinary order of the Group a) their initial assessment, audited and reviewed by an threat to the management and independent financial auditor. environment b) annual verification of their If necessary, the procedure In pursuit of this amounts in accordance with will be updated to enable an objective, the IFRS. appropriate assessment of Management Board environmental liabilities and will rely on IFRS and The initial assessment will be contingent liabilities. EU Guidelines made in 2013 in the consolidated statement of Technical, financial and legal profit or loss and in updated departments of the Company financial statements will be involved. Appropriate accounting for the provisions legal advice will also need to and contingent liabilities. be obtained.

The system will be verified by The consultant believes that an independent qualified the current provision for soil auditor as part of a financial and groundwater clean-up is audit. insufficient and should be increased (in particular for costs of mercury clean-up in Tarnów, as well as demolition work). An initial assessment by Environ is that a provision of EUR 10m should be recognised in the full-year financial statements for costs related to the Wisła landfill site as well as for additional contingent liabilities related to mercury clean-up in Tarnów. However, this needs to be verified. 33

Information: In 2020, the assumptions relating to the method of decommissioning the inactive Mercury Electrolysis Plant remained unchanged. The process will consist in demolition of the existing facilities as well as collection and disposal of the resulting waste. The site remediation concept changed, and the site is no longer intended for remediation. The provision was estimated at the amount of costs necessary to carry out the work. The execution of the work has been rescheduled to 2021-2023. As at the end of 2020: 1. Discounted amount of the provision for demolition of mercury electrolysis facilities was PLN 32,123 thousand, 2. Discounted amount of the provision for asbestos disposal was PLN 656 thousand. The provisions were presented in the separate financial statements for 2020, in Note 28 – Provisions, as the line item ‘Provision for environmental protection liabilities’ and were reviewed by the Auditor − BDO Spółka z ograniczoną odpowiedzialnością sp. komandytowa, in the course of the accounting audit. 34

0.4 The Company will maintain The technical basis for any IFRS, EBRD, EU External Recognition of Summary in annual adequate provisions and provision or contingent directive consultant/audi provisions and report Information contingent liabilities in the liability will be the subject of requirements tor regular in annual report full-year financial statements a full technical review by a remeasureme for reasonably anticipated suitably qualified independent nt of costs. The provisions and technical advisor in 2015. The provisions and contingent liabilities will be scope of work is to be agreed contingent audited and updated as part upon with the Financial liabilities of a financial audit every Auditor. three years to ensure that adequate provisions are As part of the financial audit, maintained and that an independent auditor will environmental, health and approve the relevant safety liabilities are correctly provision. assessed, quantified and reflected in the financial The purpose of the provisions statements. is to: − ensure that all regulatory The provisions need to be requirements, including independently reviewed by periodic orders or technical advisers every three demands by years. Such review, including environmental a technical opinion on the authorities, are complied provisions and contingent with; liabilities, will take place − ensure availability of a every three years, or in the provision for liabilities event of a material change to related to the landfill site accounting assumptions, or as closure and after-care required by accounting costs; and advisers. − ensure that all other legal requirements or requirements necessary to manage potential environmental liabilities are complied with. Information: The Company maintains an appropriate level of provisions, which is reviewed every year by the Financial Auditor. The provisions for 2020 were reviewed by the Auditor, BDO Spółka z ograniczoną odpowiedzialnością sp. komandytowa, in the course of the accounting audit. 35

0.5 In the event of a site closure For each such site, the IFRS Internal 2013 onwards Annual report for Please provide a or sale, the Company will Company: resources/accou the shareholders summary in the undertake an environmental − will maintain a financial nting/consultant 2016 annual assessment to identify its mechanism to implement report. environmental or social a remediation plan in case liabilities prior to the of contamination, as well closure/sale. This will as a plan for closure or include, if needed, after-care of the site, retrenchment plans to ensure including a landfill site, compliance with the EBRD or restructuring or Performance Requirement 2, retrenchment, to the as well as development and extent that, in the event implementation of of its sale, the liability remediation plans based on a and costs are not borne by site-specific risk assessment the buyer, in a manner to limit the risk to the which will ensure that any environment and humans related liabilities do not from contamination that is or revert to the Company, its may be present at, or that shareholders or its parent, may originate from, the site and or result from the Company’s − will agree on the financial activities. mechanism with the parent prior to the closure or sale. Information: The Company does not plan to close or sell a site in the near future. When individual installations are decommissioned or disposed of, an environmental assessment is carried out. The financial statements for 2020 are being audited by the Auditor, BDO Spółka z ograniczoną odpowiedzialnością sp. komandytowa, in the course of the accounting audit. 0.6 Develop a new Corporate Social impact monitoring, Best practice, Internal Ongoing; Information in the To be updated Social Responsibility (CSR) maintaining minimum CSR in Bank's PRs (PR resources annual report. every year programme for the entire accordance with the GRI 1, 2, 4 and 10) Grupa Azoty Group (Global Reporting Initiative) Information: Grupa Azoty S.A. carried out the following Corporate Social Responsibility projects: • In 2019, the Company chose not to adopt a Sustainable Development Strategy for 2018-2022. At the same time, it pursues the UN Sustainable Development Goals relevant to the chemical industry, which will be taken into account when working on the Strategy at a later time. • Integrated Report for 2020; 36

The Integrated Report covers the four largest companies of the Grupa Azoty Group: Grupa Azoty S.A., Grupa Azoty PUŁAWY, Grupa Azoty POLICE and Grupa Azoty KĘDZIERZYN. The Grupa Azoty Group’s Sustainable Development activities are aligned with the UN SDGs relevant to the chemical industry, which will also be included in a future concept for the Group’s Sustainable Development Strategy.

PILLAR 1: Product and production Our ambition: We guarantee efficient, innovative and environmentally friendly production by: Ensuring high product quality Investing in research and looking for innovative technological solutions, extending the product value chain (chemicals and plastics) Enhancing the environmental efficiency and cost efficiency of the processes (reduction of energy consumption, emissions, water consumption) Ensuring safety of production, transport and storage Ensuring staff safety Promoting the development of a closed-loop economy

PILLAR 2: People and relationships Our ambition: We enhance our positive impact on the social and economic environment by: Supporting the development of sustainable agriculture and precision farming, education of farmers Improving customer relations Supporting social and economic development of the cities and regions where our main plants are located Sponsorship, community engagement and social dialogue Developing the intellectual capital of our present and future employees, who represent our immediate social environment in the locations of our main plants

PILLAR 3: Good governance Our ambition: We strive for operational excellence and manage our risks through: Ensuring corporate governance and compliance Building a coherent organisational culture based on values and ethics Enhancing employee engagement and innovativeness Managing supply chain responsibility Ensuring cyber-security Participating in ESG (Environmental, Social and Governance) criteria reviews and ESG initiatives Monitoring of key indicators and integrated reporting in accordance with the world’s most recognised standards and guidelines. 37

0.7 Provide the Bank with a Update of the road map for Legislative Internal BAT Information in the As part of the report on the status of maintaining compliance with requirements resources assessment in annual report on annual report implementation of IED the Industrial Emissions and best 2015 progress status. for 2016, the (Industrial Emissions Directive by all Grupa Azoty practice Company will Directive) and EU ETS Group production plants. In 2015, provide the provide updated requirements by Grupa Azoty Bank with an information on as part of annual reports A schedule for an independent executive summary steps taken to submitted to EBRD. audit of IED BAT compliance of the BAT ensure will be developed in 2015, assessment and ESAP continuous The report also includes taking into account implementation. compliance with information on the status of compliance post 2016. BAT, and will projects in progress and identify the projects planned to ensure Provide information in the specific BAT compliance after 2016. annual report on any material requirements to instances of non-compliance, be implemented An independent audit is to be accidents/incidents, or within four undertaken in 2015. investment needs as agreed years of with regulators. adoption of the new Best Available Techniques Reference Document (“BREF”) Information: Key pro-environmental projects completed in 2017 at Grupa Azoty S.A. included the construction of flue gas deNOx and desulfurisation units. The projects were undertaken to ensure compliance of the Company's industrial combustion sources with the requirements laid down in the Minister of Environment's Regulation on emission standards for installations of April 22nd 2011 and the Industrial Emissions Directive. As a result, the amount of pollutants released into the environment by the combustion sources will be reduced, improving air quality. Construction of the flue gas desulfurisation and NOx removal units was co-financed under the Norwegian Financial Mechanism 2009–2014. Capital expenditure on the flue gas desulfurisation and particulates extraction project totalled PLN 43,220 thousand (which includes expenditure until 2020). Capital expenditure on the flue gas deNOx project totalled PLN 44,497 thousand (which includes expenditure until 2020).

0.8 Ensure that Grupa Azoty has Ensure ongoing compliance Legal Internal Ongoing Provide update on valid IPPC/IED permits and is with IPPC and IED. requirements resources status in the annual in compliance with Polish and report submitted to EU requirements. the Bank. Information: Currently, Grupa Azoty S.A. operates pursuant to the following decisions: Integrated permits: • Decision by the Marshal of the Kraków Province dated June 20th 2012 Ref. No. SR-II-1.7222.1.1.2012, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie-Mościcach for the Hydrogen Unit, valid for an indefinite term (permit amended by Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.13.2014); • Decision by the Governor of the Kraków Province dated February 16th 2007 Ref. No. ŚR.XIV.JI.6663-6-05, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie-Mościcach for the Park Infrastruktura Complex, valid for an indefinite term (permit amended by Decision of July 29th 2011 Ref. No. SR-II-1.7222.1.3.2011, Decision of September 11th 2012 Ref. No. SR-II-1.7222.1.7.2012, Decision of December 3rd 2014 Ref. No. SR- II-1.7222.2.17.2014, Decision of December 31st 2015 Ref. No. SR-II-1.7222.2.1.2015, Decision of March 10th 2017 Ref. No. SR-II.7222.2.9.2016; Decision of June 22nd 2020 Ref. No. SR-II.7222.2.4.2020, and Decision of August 12th 2020 Ref. No. SR-II.7222.2.28.2019); • Decision by the Governor of the Kraków Province dated April 17th 2007 Ref. No. ŚR.XI.JI.6663-3-06, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie - Mościcach for the POM Manufacturing and Compounding Complex, valid for an indefinite term (permit amended by Decision of July 29th 2011 Ref. No. SR-II-1.7222.1.1.2011 and Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.14.2014); • Decision by the Governor of the Kraków Province dated July 29th 2011 Ref. No. SW.II.1.AJ.7673-10/09, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie - Mościcach for the Technical Grade Nitric Acid Unit, Calcium Ammonium Nitrate and Ammonium Nitrate Unit, Nitrogen Fertilizer Granulation Unit, and Dolomite Milling Unit, valid for an indefinite term (permit amended by Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.15.2014, Decision of August 16th 2016 Ref. No. SR-II.7222.2.8.2016, Decision of July 21st 2017 Ref. No. SR- II.7222.2.27.2016, and Decision of January 18th 2018 Ref. No. SR-II.7222.2.34.2017); • Decision by the Governor of the Kraków Province dated July 17th 2007 Ref. No. ŚR.XIV.JI.6663-2-06, granting an integrated (IPPC) permit to Zakłady Azotowe w Tarnowie-Mościcach for the Caprolactam and Polyamide Manufacturing Complex (permit amended by Decision of March 16th 2009 Ref. No. SW.II.1.JI.7673-6/08, with respect to the Natural Polyamide Unit), amended in its entirety by Decision by the Marshal of the Kraków Province dated December 1st 2010 Ref. No. SW.II.1.AJ.7673-11/08 (permit amended by Decision of July 29th 2011 Ref. No. SR-II-1.7222.1.2.2011, Decision of February 16th 2012 Ref. No. SR-II-1.7222.1.2.2012, and Decision of June 20th 2012 Ref. No. SR-II-1.7222.1.5.2012), Decision of October 21st 2013 Ref. No. SR-II-1.7222.1.3.2013, Decision of December 3rd 2014 Ref. No. SR-II-1.7222.2.16.2014, Decision of January 23rd 2018 Ref. No. SR.II.7222.2.12.2017, Decision of August 17th 2020 Ref. No. SR-II.7222.1.28.2018.AJ, and Decision of December 10th 2020 Ref. No. SR- II.7222.2.24.2019.AJ, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated June 28th 2018, Ref. No. SR-II.7222.13.4.2016, granting an integrated (IPPC) permit to Grupa Azoty S.A. for its Iron-Chromium Catalyst Plant II, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated July 1st 2015 Ref. No. SR-IV-1.7222.1.2015 MG, granting an integrated (IPPC) permit to Grupa Azoty S.A. for the Central Wastewater Treatment Plant, (amended by Decision of April 20th 2018 Ref. No. SR-II.7222.1.7.2018.MM and Decision of June 24th 2020 Ref. No. SR-II.7222.2.17.2019.WM),valid for an indefinite term; Air emissions • Decision by the Governor of the Kraków Province dated December 29th 2014, Ref. No. SR-II-1.7221.2.2014, granting a permit for release of gases 39

and dusts into the air to Grupa Azoty S.A., valid until December 28th 2024; • Notification of Grupa Azoty S.A.'s EC II CHP Plant Water Treatment Unit and Modified Plastics Facility to the Marshal of the Kraków Province Ref. No. TB/JK/1034/2014, dated November 24th 2014; EU ETS • Decision by the Marshal of the Kraków Province dated April 28th 2017, Ref. No. SR-II.7225.1.21.2016, granting permission to participate in the European Union Emissions Trading Scheme for the CHP plant located on the premises of Grupa Azoty S.A., including a Monitoring Plan, amended by Decision by the Marshal of the Kraków Province dated September 16th 2019, Ref. No. SR-II.7225.2.3.2019.AJ, including a Monitoring Plan, and Decision by the Marshal of the Kraków Province dated September 28th 2020 Ref. No. SR-II.7225.2.9.2019.AJ, including a Monitoring Plan, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated April 2nd 2020 Ref. No. SR-II.7225.6.2.2019.AJ, approving the Monitoring Methodology Plan for the CHP plant; • Decision by the Marshal of the Kraków Province dated November 24th 2017, Ref. No. SR-II.7225.1.7.2016, granting permission to participate in the European Union Emissions Trading Scheme with respect to greenhouse gas emissions from the units manufacturing nitric acid, ammonia and bulk organic chemicals by way of cracking, reforming, oxidation or similar processes, with a daily production capacity of over 100 Mg, including a Monitoring Plan, amended by Decision by the Marshal of the Kraków Province dated June 13th 2019 Ref. No. SR-II.7225.3.12.2018.AJ, including a Monitoring Plan, and amended by Decision by the Marshal of the Kraków Province dated January 18th 2021 Ref. No. SR-II.7225.2.3.2020.AJ, including a Monitoring Plan, valid for an indefinite term; • Decision by the Marshal of the Kraków Province dated April 2nd 2020 Ref. No. SR-II.7225.6.3.2019.AJ, approving the Monitoring Methodology Plan for the Production Units. Water and wastewater • Decision by the Mayor of Tarnów Ref. No. WGK.B-III.6210/16/02/03 dated January 13th 2003, granting a permit for collective water supply and collective wastewater discharge, valid for an indefinite term; • Decision by the Governor of the Kraków Province dated December 30th 2014 Ref. No. SR-IV-1.7322.1.28.2014.MG, granting a permit for special use of water – abstraction of groundwater from an intake point located in Tarnów-Mościce, valid until December 31st 2034; • Decision by the Governor of the Kraków Province dated December 29th 2005 Ref. No. ŚR.XIV.MGą.6811-31-05, granting a permit for special use of water – abstraction of surface water from the Dunajec river, valid until December 31st 2025, amended by Decision Ref. No. KR.RUZ.4211.180.2018.IT dated November 16th 2018; • Decision by the Regional Water Management Authority of Kraków Ref. No. KR.RUZ.421.1.102.2019.AS dated July 1st 2019, granting a permit for discharge of wastewater containing substances particularly harmful to the water environment into the sewerage system of Zakład Oczyszczania Ścieków T.W. Sp. z o.o., valid until July 1st 2023; • Decision by the Marshal of the Kraków Province dated December 15th 2017 Ref. No. SR-IV.7322.1.259.2017.MG, granting a permit for discharge of wastewater into surface waters, valid until December 31st 2021; • Decision Ref. No. SR-IV.1.7328.1.2013.MG, establishing a protected zone for water intake points; Waste • Decision by the Marshal of the Kraków Province dated January 20th 2016 Ref. No. SR-III-1.7244.4.9.2015.AG permitting Grupa Azoty S.A. to collect and process waste, valid until January 19th 2026; Other Activities • Resolution of the Provincial Assembly of the Kraków Province of October 25th 2010, No. LI/833/10, establishing Industrial Zone at ZAT S.A. 40

(Official Journal of the Province of Kraków, No. 580/2010, item 4475). 0.9 Develop and implement a The corporate (and site- Best practice, 2013−2016; SEP to be NTS is to be a corporate (Grupa Azoty) specific) SEP will outline the EBRD PRs thereafter to amended/updat separate document Stakeholder Engagement Plan Company's public be reviewed ed every three in accordance with (SEP) in line with EBRD PR 10. communication policy and every two years or earlier, the Environmental commitments, including the years as part as needed. Impact Assessment For any new investment grievance mechanism, of EHS audits directive (“EIA project where an indication of contact persons Please provide a directive”), and Environmental Impact and project information copy of the NTS include information Assessment (EIA) is required availability. (link to web on the project, by Polish authorities, publish site) in the impacts and risk online a Non-Technical annual report mitigation actions, Summary (NTS) of SEP for all and as a presented in a projects covered by Annex 1 summary of SEP concise and as defined in the EIA directive associated with meaningful way. Ensure that the EIA process is the EIA process. carried out in accordance with EU and Polish requirements. Information: On its website, Grupa Azoty regularly publishes its Integrated Report, addressing a range of aspects, including safety and environmental protection (for the most recent report visit http://raport2019.grupaazoty.com/) 0. Regular ESHS audits (every Review status of operations Best practice As part of BAT Report for the Report for the 10 three years) to review the assessment in Management Bank as part of progress in ESAP 2015 Board and 2016 report implementation and status of EBRD compliance with EU environmental standards. The first report will be part of BAT assessment. 41

Information: In line with the Strategy, the Company focuses on consistent alignment of product quality and range to customer requirements, product improvement with the use of innovative technologies, and reduction of product costs through modernisation of key production lines. To ensure lasting and effective customer relations and become the first-choice supplier, the Company makes every effort to offer top quality products. The pursuit of strategic objectives is based on management systems consistent with the highest international standards. Also, pursuant to environmental protection laws, the Company holds valid integrated (IPPC) permits to operate all its production units, which define the Company's obligations under applicable laws. BAT assessments for individual units were made in the applications for amendments to the integrated (IPPC) permits for existing IPPC installations and will be made in the applications for integrated (IPPC) permits for new installations. The analysis confirmed compliance of Grupa Azoty S.A.'s existing installations with BAT. For information on EHS audits, see Section 1.1. 0.1 Develop contaminated land Compliance with the Legislative As soon as Soil or Regular 1 management plan - this regulations and remediation requirement possible groundwater monitoring should include identification programmes. surveys or results for each and cataloguing of monitoring contaminated contaminated sites, control results site. measures and remediation Identification plan. should cover areas around production plants. Information: Grupa Azoty S.A. carried out surveys to find out if there are any contaminated areas within its premises. The surveys enabled the Company to make a catalogue of contaminated sites. Local soil contamination with mercury was found at the decommissioned Mercury Electrolysis Unit – spreading of the contamination is monitored by means of piezometers located within the contaminated area. No contamination of groundwater was detected. In 2015, a Baseline Report was prepared covering the Company's premises, which is submitted to the Marshal Office together with applications for integrated permits. In accordance with the integrated (IPPC) permits, a systematic soil and groundwater contamination risk assessment is conducted every year for facilities covered by the permits. 1. Site Specific Environmental, Health and Safety Management System No. Action Environmental risks, Legislative Requirement/ Scheduled Target and Comments liabilities/benefits requirements/B Resources completion – evaluation criteria est practice action to be for implementation completed by progress end of year 42

1.1 Introduce newly developed In order to maintain Compliance Management In the course EHS management Cover each Environmental, Health and comprehensive management with EBRD and time or of 2013-2014 system has a clear plant with the Safety Management Systems systems at the Company, it is PR 1. consultant structure defining existing EHS at all Grupa Azoty production necessary to implement the Compliance fees responsibilities and management plants. newly developed EHS systems with standards formalised operating systems at all production plants. of the leading procedures. Maintaining effective and companies (ZA comprehensive environmental Tarnów and ZA and social management Puławy). systems is the best way to ensure a dynamic and continuous improvement of EHS performance at the Company. It allows the organisation to identify, avoid, minimise and mitigate potential EHS risks and impacts. The EHS management system must cover activities undertaken by contractors and other third parties (plant engineering and maintenance staff) as well as other plant staff. The system should include an EHS training programme for all employees and contractors. Information: On a site-specific basis, i.e. Grupa Azoty S.A.

Grupa Azoty S.A. pursues a Corporate Management Policy which guarantees that the Company's strategic goals are achieved in reliance on an integrated management system, consistent with international standards. Grupa Azoty S.A. holds the following management system certificates related to the indicated areas: − Quality Management System conforming to the ISO 9001 standard, − Environmental Management System conforming to the ISO 14001 standard, − Energy Management System conforming to the ISO 50001 standard, − Food Safety Management System conforming to the ISO 22000 standard, − Occupational Health and Safety Management System conforming to the BS OHSAS 18001 standard, 43

− Automotive Industry Quality Management Standard implemented in accordance with the IATF 16949 standard, − PN-EN ISO/IEC 17025 Management System (general requirements for the competence of testing and calibration laboratories), − Product Stewardship Management Standard, − Enterprise Risk Management System, − Information Security Management System conforming to the ISO/IEC 27001 standard.

The implemented systems are continually improved. The Company adopts improvement programmes for a given year, covering, among other things, various issues that determine improvement in the EHS area. The manner of proceeding in this respect is described in a management systems procedure, which has been put in place. The Company has also implemented a procedure for identification of environmental aspects and selection of material aspects. Another procedure in place at the Company is the Environmental Monitoring and Measurements. The following procedures apply with respect to OHS management: the Occupational Risk Management, and the Monitoring of Occupational Health and Safety. These tools describe the rules of identifying, assessing and managing environmental and OHS issues with a view to minimising related risks. The procedures and other internal regulations adopted by the Company take into account the activities of employees, contractors and other third parties, as well as their training. 44

1.2 Provide annual reports on EHS Aspects to be included in the Best Internal Annually, Expand existing Provide annual performance to EBRD and annual report: practice/compli resources published in shareholder reports on other shareholders. − general information on ance with EBRD the first reporting Environmental, the project status within PRs quarter of a system. Social, Health and A general (brief) summary of the Group; year Safety (ESHS) environmental and social − information on the overall performance to the matters to be provided on the environmental First report in EBRD and other website. performance and 2014. shareholders. compliance; For every new project that − summary of KPIs covering A general (brief) requires an EIA under Polish energy intensity and summary of law and is subject to Annex 1 carbon dioxide emissions environmental and to the EIA directive, a Non- for each subdivision; social matters to be Technical Summary (NTS) to − summary of any areas of provided on the be provided on the Internet. material non-compliance website. with environmental regulations, or material breach of the relevant permit levels; − information on any material fines or other material penalties or pending prosecutions related to ESHS matters; − general information on ESAP implementation; − summary of any material legislative changes related to environmental or social aspects. Information: The EHS report was prepared in 2020. EHS information is included in the report for EBRD and in the account of ESAP implementation. Grupa Azoty was working to prepare its integrated report for 2019. The report, drawn up in accordance with the Global Reporting Initiative Standards, was audited by an external auditor. The GRI report is available on the Company's website. Non-Technical Summaries concerning new implemented projects requiring an EIA are posted on the Grupa Azoty website. 45

1.3 Set up a procedure to process Early identification of Best practice Operational Ongoing Management reports Set up a complaints and grievances to problems and public and compliance costs of on application of the procedure to enable meaningful public grievances to ensure timely with EBRD and information grievance procedure process consultation and information implementation of solutions. PR 10 office. complaints and process, in particular with requirements. grievances to regard to historical enable environmental impact (e.g. meaningful the Wiślinka landfill site in public Gdańsk). The potential consultation and environmental and social risks information are treated as a significant process issue requiring much attention. Information: Grupa Azoty S.A. has developed and implemented a procedure for handling complaints and grievances in the form of Instruction No. I-705/4. 2. Actions required to maintain compliance with EHS requirements of national law and EU environmental standards - GRUPA AZOTY S.A. No. Action Environmental risks, Legislative Requirement/ Scheduled Target and Comments liabilities/benefits requirements/B Resources completion – evaluation criteria est practice action to be for implementation completed by progress end of year 2.1 Monitoring of environmental Record consumption of raw Legislative Internal Ongoing/ad-hoc and Statement of Achieve impacts of all operated materials, fuels and energy, obligation, best resources periodic reports compliance environmental production facilities. air emissions, water practice/intern in the annual impact level in consumption, and amounts of al resources report line with the Reference to BAT generated waste Regularly design, requirements. evaluate operational environmental efficiency to minimise guarantees and resource consumption and standards, waste generation. identify potential improvements. Submit report to the Bank. 46

Information: The Company records consumption of raw materials, fuels and energy, air emissions, water consumption, and amounts of generated waste. Data describing the scale of environmental impacts is entered in the Company's Environmental Pollution Data Bank. This IT system is used to prepare Reports for the Marshal Office of Kraków and ad-hoc reports for the Company's internal needs and for external institutions. Furthermore, reports are prepared for the National Database on Emissions of Greenhouse Gases and Other Substances, and the National Pollution Release and Transfer Register. As part of reviews of the integrated (IPPC) permits held by Grupa Azoty S.A., the Company’s compliance with BAT requirements is assessed. In 2020, an assessment was performed to check the conformity of the Company's environmental impacts with the integrated (IPPC) permits held. 2.2 Complete planned The Sulfuric Acid Plant Best practice Internal Ongoing/ad-hoc and Provide investment projects, such as is being upgraded and Legal resources periodic reports update on the Sulfuric Acid Plant the project will help requirements BAT upgrade, to maintain maintain BAT /BAT compliance compliance with BAT. compliance as part of 2015 BAT assessment Information: The upgrade of the Sulfuric Acid Plant was completed in December 2013. The purpose of the project was to achieve improved environmental performance and increased steam output, while ensuring BAT compliance. Capital expenditure on the project totalled PLN 64,646 thousand. 2.3 Complete the planned Reduce environmental impact Legislative Investment By 2016/2017 Obtain a relevant modernisation of energy in line with IED requirements requirements, needs permit generation installations to (Annex V of IED). The best ensure compliance post 2016. investment project will management Update information The action will require include a deNOx unit, an FGD practices, on the project in the application of relevant unit, and a more efficient Bank's PRs annual report, derogations agreed upon with particulates extraction selected technology Polish and EU authorities. system, in connection with and target emission BAT requirements. levels. Target emission levels: 3 200 mg/m for SO2 As part of the energy audit Publish NTS of the 200 mg/m3 for NOx and BAT assessment, other project and provide 20 mg/m3 for PM. carbon reduction measures copy/web link to the will be considered. Bank as part of the The Company to provide annual report. information on the derogations and their relevance to the annual report. 47

Information: Key pro-environmental projects completed in 2017 at Grupa Azoty S.A. included the construction of flue gas deNOx and desulfurisation units. The projects were undertaken to ensure compliance of the Company's industrial combustion sources with the requirements laid down in the Minister of Environment's Regulation on emission standards for installations of April 22nd 2011 and the Industrial Emissions Directive. As a result, the amount of pollutants released into the environment by the combustion sources will be reduced, improving air quality. Construction of the flue gas desulfurisation and NOx removal units was co-financed under the Norwegian Financial Mechanism 2009–2014. Capital expenditure on the flue gas desulfurisation and particulates extraction project totalled PLN 43,220 thousand (which includes expenditure until 2020). Capital expenditure on the flue gas deNOx project totalled PLN 44,497 thousand (which includes expenditure until 2020).

In 2020, GA S.A. continued projects designed to bring the Company’s heat and power generation activities in line with the more stringent environmental requirements arising from BAT conclusions (Commission Implementing Decision 2017/1442/EU of July 31st 2017 establishing best available techniques (BAT) for large combustion plants). The projects include upgrades of the K1 gas-fired boiler and FGD unit on the K5 boiler. Capital expenditure on the projects in 2020 totalled PLN 1,483 thousand. 2.4 Prepare a plan (including Reduce environmental impact Legislative Investment 2015 - 2020 as Obtain integrated Information on . budget) and - if necessary - and ensure compliance with requirements, needs, internal required by (IPPC) permit and the progress upgrade the wastewater IED requirements. best and external competent achieve compliance status should be treatment plant to ensure management authorities provided in long-term compliance with practices, annual reports Polish and EU environmental Bank's PRs starting from standards 2015 Information: Grupa Azoty prepared an upgrade plan for its wastewater treatment plant. Possible time of implementation of the project has been defined as 2020- 2021. Due to changes in the composition and volume of wastewater in recent years, in 2020 the Company launched the construction of a pilot-plant unit for biological treatment of wastewater. The project is scheduled for completion in 2021. The unit will enable tests to be carried out on a pilot-plant scale on industrial wastewater streams discharged from Grupa Azoty S.A.’s production lines in Tarnów, consisting in simulation of biological wastewater treatment in various process configurations, under near real-life conditions. The purpose of the tests will be to optimise the processes at the biological wastewater treatment plant (BOŚ) currently in operation, in order to improve the efficiency of nitrogen removal and to select process configurations and technical and process parameters for the upgrade of BOŚ. After the tests, the plan is to be updated e.g. to continue the work scope optimisation and update the project schedule. 2.5 Prepare a plan (including Reduce negative Legislative Internal 2015 - 2018 Report on soil and budget) and conduct soil and environmental impact in line requirements, resources and groundwater groundwater surveys. with IED requirements. This best external condition will enable an assessment of management support baseline conditions and practices, identification of potential Bank's PRs impact receptors. 48

Information: In 2015, a Baseline Report was prepared covering the Company's premises, which was submitted in 2016 to the Marshal of the Kraków Province. In accordance with the integrated (IPPC) permits, a systematic soil and groundwater contamination risk assessment is conducted every year for facilities covered by the permits.

Annual Environmental & Social Report

1. Information about the Company Company Name: Grupa Azoty Zakłady Azotowe Puławy S.A. Company Address: Aleja Tysiąclecia Państwa Polskiego 13 Country: Poland Town/Location: Puławy Company authorised representative: Jacek Janiszek I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period. Signature:

Title: Vice President of the Management Board April 15th 2021 Contact Details: Telephone: (+48) 81 565 20 50 E-mail: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide:

Item Cumulative

[PLN ‘000] 2019 2020

Revenue 3,137,472 2,757,155

Profit/(loss) on sales 396,617 213,195 EBIT 394,471 280,603 EBITDA 621,415 512,383 Net profit/(loss) 283,848 221,967

Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions; Number of staff employed and any change in employment over past 3 years

As at As at As at Dec 31 Dec 31 2018 Dec 31 2019 2020 Number of direct employees: 3,486 3,487 3,605 Number of contracted workers: 22 31 27

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive)

Environmental decisions held by Grupa Azoty Zakłady Azotowe Puławy S.A.

A. Integrated permit

• Decision of the Provincial Office of Lublin No. PZ 7/2004 Ref. No. ŚiR.V.6618/31-5/04, granting to Zakłady Azotowe Puławy S.A. of Puławy an integrated (IPPC) permit to operate 2

chemical industry installations to manufacture, using chemical processes, organic and inorganic chemicals and artificial fertilizers, a fuel combustion plant with a rated capacity of no less than 50 MW, a landfill intended for wastes other than hazardous and inactive waste, an ammonia storage and distribution tank, and a wastewater treatment installation.

Amending decisions: • Decision No. PZ 12/2007 of December 12th 2007, Ref. No. ŚiR.V.6618/14-12/2006/2007, issued by the Governor of the Lublin Province • Decision No. PZ 8/2008 of November 25th 2008, Ref. No. RŚ.IŁ.0722/12/08, issued by the Marshal of the Lublin Province • Decision No. PZ 21/2010 of July 27th 2010, Ref. No. RŚ.V.MJ.7624/52/08, issued by the Marshal of the Lublin Province • Decision No. PZ 16/2011 of August 9th 2011, Ref. No. RŚ.V.IŁ.7624/52/08, issued by the Marshal of the Lublin Province • Decision No. PZ22/2012 of November 28th 2012, Ref. No. RŚ.V.IŁ.7624/52/08, issued by the Marshal of the Lublin Province • Decision No. PZ23/2014 of October 23rd 2014, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province • Decision No. PZ45/2014 of November 28th 2014, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province • Decision No. PZ7/2015 of April 8th 2015, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province • Decision No. PZ15/2015 of June 24th 2015, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province • Decision No. PZ6/2016 of February 26th 2016, Ref. No. RŚ-V.7222.46.2014.MCHW, issued by the Marshal of the Lublin Province • Decision No. PZ 15/2017 of July 11th 2017, Ref. No. RŚ-V.7222.46.2014.MCHW, issued by the Marshal of the Lublin Province • Decision No. PZ 30/2017 of December 18th 2017, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province • Decision No. PZ 14/2018 of April 24th 2018, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province • Decision No. PZ 23/2019 of November 6th 2019, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province • Decision No. PZ 4/2020 of February 11th 2020, Ref. No. RŚ-V.7222.46.2014.ILU, issued by the Marshal of the Lublin Province.

B. Integrated permit • Decision No. PZ22/2018 of July 11th 2018, Ref. No. RŚ-V.7222.2.2018.ILU, issued by the Marshal of the Lublin Province to operate chemical industry installations to manufacture, using chemical or biological processes, straight or compound fertilizers based on phosphorus, nitrogen or potassium.

Validity period – indefinite

B. Decision permitting participation in the EU emissions trading scheme – installation: CHP Plant

• Decision of August 9th 2016, Ref. No. RŚ-V.7225.8.2016.ARA , issued by the Marshal of the Lublin Province as amended by: • Decision of March 21st 2017, Ref. No: RŚ-V.7225.8.2016.MCHW, issued by the Marshal of the Lublin Province • Decision of February 7th 2018, Ref. No: RŚ-V.7225.8.2016.AGK, issued by the Marshal of the Lublin Province • Decision of April 18th 2019, Ref. No: RŚ-V.7225.8.2016.AGK, issued by the Marshal of the Lublin Province

C. Decision granting permit for greenhouse gas emissions by process installations

• Decision of August 9th 2016, Ref. No: RŚ-V.7225.7.2016.ARA, issued by the Marshal of the Lublin Province, as amended by: • Decision of March 21st 2017, Ref. No: RŚ-V.7225.7.2016.MCHW, issued by the Marshal of the Lublin Province • Decision of February 8th 2018, Ref. No: RŚ-V.7225.7.2016.AGK, issued by the Marshal of the Lublin Province • Decision of April 5th 2019, Ref. No: RŚ-V.7225.7.2016.AGK, issued by the Marshal of the Lublin Province.

D. Sector permits • Decision approving the landfill site operation manual dated December 17th 2014, Ref. No: RŚ-V.7241.34.2014.LG, issued by the Marshal of the Lublin Province.

E. Safety report

Safety report approved by the Commander-in-Chief of the State Fire Service in the Lublin Province by way of Decision No. 1/2020 (Ref. No. WZ.5586.26.2019.AK) of March 25th 2020. The other documents required under the Environmental Protection Law, i.e. the notification, Industrial Accident Prevention Programme and Internal Rescue Operation Plan, were submitted together with the report. The Commander-in-Chief of the State Fire Service in the Lublin Province raised no reservations about the notification and gave a favourable opinion on the remaining documents. By letter Ref. No. WI.7060.1.57.2019.RG of January 15th 2020, the Inspectorate of Environmental Protection for the Lublin Province endorsed the Safety Report submitted by Grupa Azoty Zakłady Azotowe Puławy S.A.

Reporting period: 2020

2. General Is the project materially Yes [X] If No, please provide details of any material compliant with all relevant EBRD No [ ] non-compliances: Performance Requirements (taking account of agreed action plans, exemptions or derogations)? Is the project materially compliant Yes [X] If No, please provide details of any material with all applicable environmental No [ ] non-compliances: and social laws and regulations? Have there been any accidents or Yes [ ] If Yes, please describe, including details of incidents that have caused damage No [X] actions to remedy and prevent reoccurrence: to the environment, brought about injuries or fatalities, affected project labour or local communities, affected cultural property, or created liabilities for the Company? 4

Have there been any changes to Yes [X] If Yes, please describe: environment, social, labour or No [ ] • ACT of March 2nd 2020 on Special Measures health and safety laws or to Prevent, Counteract and Combat COVID- regulations that have materially 19, Other Infectious Diseases and Crisis affected the Company? Situations Caused by Them, as amended. • REGULATION OF THE MINISTER OF HEALTH of March 20th 2020 on the declaration of the state of epidemic in the Republic of Poland, as amended. • ACT of April 16th 2020 on Special Support Mechanisms in Connection with the Spread of the SARS-CoV-2 Virus, as amended. Further regulations on the introduction of certain restrictions, orders and prohibitions due to the state of epidemic. The Waste Act has introduced the requirement to conduct video surveillance of waste landfill sites – with respect to GA Puławy, a visual monitoring system needs to be installed on one of the landfill cells. How many inspections did you Number: 4 Please provide details of these visits, including receive from the environmental number and nature of any violations found: authorities during the reporting Inspections by the Provincial Inspectorate of period? Environmental Protection From July 21st to August 3rd 2020, an inspection was carried out to assess compliance with the obligations arising from participation in the greenhouse gas emissions trading scheme and compliance with environmental protection requirements by the operators of facilities requiring an integrated (IPPC) permit. In connection with a single violation found in the course of the inspection, namely a breach of the permit by exceeding the emission standards for pollutants released into the air from the CHP plant and the annual emissions of pollutants covered by those standards, calculations of the pollutant dispersion were performed based on the CHP plant’s actual emission volumes for sulfur dioxide in 2018 and for nitrogen oxides and particulate matter in 2019, confirming that the increased emissions did not result in exceeding the environmental quality standards beyond the area to which the Company holds legal title.

How many inspections did you Number: 15 Please provide details of these visits, including receive from the health and safety inspections number and nature of any violations found: authorities during the reporting during the 2020 All the inspections concerned compliance with period? calendar year. the requirements for hygienic conditions and protection of health in the workplace. No follow- up recommendations were issued after the inspections. 5

How many inspections did you Number: 2 Please provide details of these visits, including receive from the labour inspections number and nature of any violations found: authorities during the reporting during the 2020 After the first inspection carried out by the period? calendar year. National Labour Inspectorate, an administrative instruction and improvement notice with follow- up recommendations were issued. The instruction of May 21st 2020 contained a recommendation to update the Company’s OHS and Fire Protection Manual for the Urea Department so as to clarify its provisions with regard to cases where it is necessary to clean process units shut down for maintenance by washing them with water and/or purging them with air or nitrogen. The improvement notice of May 21st 2020 contained the following recommendations: 1. Examine the advisability and feasibility of the use by employees and third-party contractors working on repairs or maintenance of ZA Puławy’s chemical units containing ammonia of chemical resistant workwear protecting its users from exposure to ammonia, with possible specification of the types of work requiring the use of such workwear. 2. Take steps to improve the readability, clarity and precision of the provisions of “permits to perform hazardous work” used for organising work carried out in hazardous conditions. After the second inspection carried out by the National Labour Inspectorate, an administrative instruction of September 23rd 2020 was issued, which contained two recommendations: 1. Re-assess occupational risks for the job positions listed below: (206 job positions), taking into account the epidemiological risk associated with Covid-19. 2. Inform employees of the updated notice concerning occupational risks associated with their work and the rules of protection against such risks, and then duly document that fact. The recommendations were implemented within the time limits prescribed by the Inspector.

Have these visits resulted in any Yes[x] If Yes, please describe, including status of penalties, fines and/or corrective No [ ] implementing corrective actions to address any action plans? violations found: No fines or other penalties were imposed. All recommendations contained in the administrative instructions and improvement notices were implemented within the time limits prescribed by the Inspector, i.e.: - The Company’s OHS and Fire Protection Manual for the Urea Department was updated by clarifying its provisions with regard to cases where it is necessary to clean process units shut down for maintenance by washing them with water and/or purging them with air or nitrogen. The updated manual was approved on June 26th 2020 by the Head of the Urea and Melamine Plant. - Changes were made to the form of a permit to perform hazardous work (schedule 2 to the relevant order) by adding a requirement to wear chemical resistant coveralls in Section VI “Safety measures required from the contractor”. Work on the order is currently in progress. -The instruction how to complete a permit to perform hazardous work (schedule 2 to the relevant order) was amended to include an additional provision: “The permit must be completed in legible handwriting!”. Work on the order is currently in progress. - Occupational risks for specific job positions listed in the instruction were re-assessed, taking into account the epidemiological risk associated with Covid-19. - Employees were informed of the updated notice concerning occupational risks, and the fact was documented in relevant occupational risk acknowledgement sheets. Has the Company engaged any Yes [ ] If Yes, please state for which types of work, and contractors for project-related No [X] how the Company has monitored the compliance work in the reporting period? of contractors with EBRD Performance Requirements and the Environmental and Social Action Plan:

Yes [X] If Yes, please provide details, including how the No [ ] Company is ensuring that corrective actions are implemented by the contractor? Were any violations found as a During inspections, recommendations are issued result of these actions that were – such recommendations are presented in the responsibility of external inspection reports or given orally. Compliance contractors engaged by the with the recommendations is checked during Company? subsequent inspections. In the event of serious non-compliances, work is interrupted until the problem is remedied. Have any operations been Yes[x] If Yes, please describe: reduced, temporarily suspended or No [ ] Due to the declared state of epidemic, periodic closed down due to environmental, OHS training and medical check-ups were health, safety or labour reasons? suspended/limited. 7

Please describe any environment or social programmes, initiatives or sub-projects undertaken during the reporting period to improve the Company's environmental or social performance and/or management systems: See Section 9. Please indicate the level of associated expenditure (capital expenditure and operating expenditure), and whether this relates to the requirements of the Environmental and Social Action Plan, or to any other initiative: See Section 9.

4. Environmental Monitoring Data for each of the key subsidiaries The information required in this section can be extracted from a CSR report, or a full CSR report can be attached.

Please provide the name and contact details for Marek Kuba – Chief Environmental your environmental manager: Protection Officer, Email: [email protected] Telephone: (+48) 81 565 21 27 Parameter2 Amount3 Unit Compliance Status4 Comments5 Wastewater 2020 Total wastewater 68,044 ‘000 m3 Biochemical Oxygen 0.20 Compliant with mg/dm3 Demand (BOD5) Integrated Permit Chemical Oxygen 31.3 Compliant with mg/dm3 Demand (COD) Integrated Permit Suspended solids 26.3 Compliant with mg/dm3 Integrated Permit Phosphorus 0.28 Compliant with mg/dm3 Integrated Permit Nitrates 7.8 Compliant with mg/dm3 Integrated Permit Heavy metals Zinc 0.060 mg/dm3 Compliant with Integrated Permit Nickel 0.002 mg/dm3 Compliant with Integrated Permit Lead 0.00 mg/dm3 Compliant with Integrated Permit Chromium 0.006 mg/dm3 Compliant with Integrated Permit Copper 0.017 mg/dm3 Compliant with Integrated Permit Arsenic 0.00 mg/dm3 Compliant with Integrated Permit [Other] Per each major Air emissions Mg/year point source

SO2 936.29 Mg/year Compliant with Integrated Permit

Nitrogen oxides (NOX) 2,230.26 Mg/year Compliant with Integrated Permit 8

Ammonium nitrate 339.86 Mg/year Compliant with dust Integrated Permit Urea dust 26.46 Mg/year Compliant with Integrated Permit Ammonium sulfate 7.10 Mg/year Compliant with dust Integrated Permit Melamine dust 6.36 Mg/year Compliant with Integrated Permit Particulate matter 138.95 Mg/year Compliant with from fuel combustion Integrated Permit

CO2 1,696,294.05 Mg/year Compliant with Integrated Permit Other parameters Noise emissions Night-time Compliant with measurement: dB Integrated Permit 42.3 – 44.8 Daytime dB measurement: 40.1 – 45.3 [Other] Solid waste Please provide details of the types and amounts of solid wastes generated by the project. Indicate where wastes are classified as hazardous. Indicate the final re-use, recycle or disposal method for each waste type. 2020 Permitted in Integrated Permit Waste type Generated [Mg] [Mg] Hazardous waste 465.4230 Compliant with Integrated Permit Non-hazardous waste 52,756.4189 Compliant with Integrated Permit Total 53,221.8499 Compliant with Integrated Permit

[Mg]

Self-management of waste − total, 10,273.2664 including: - Recovery 0.0 - Storage 10,273.2664

Waste transferred to external companies holding appropriate permits for waste 62,954.6510 collection/recovery/disposal, including:

- waste generated in this reporting 42,844.3960 year Waste stored at year end as a proportion of waste generated during this reporting year, 104.1879 including: - Hazardous 49.4910 - Non-hazardous 54.6969

5. Resource Usage and Product Output Measureme Parameter Amount Comments6 nt Unit Fuels used Crude oil - Natural gas 951,537 Tm3 Jointly as feedstock and fuel 9

Hard coal 615,988 t Lignite Grid electricity Energy purchased for own needs and for 1,001,950 MWh resale Heat purchased - from external sources Feedstocks and raw materials used Benzene in 53,798 t processing Polyethylene 2081 kg Sulfur 33,983 t Product output Ammonium nitrate 1,062,923 t Caprolactam 57,149 t Urea 1,141,970 t Melamine 81,170 t

6. Human Resources management Please provide the name and contact details for Renata Kubiś, Head of HR Administration, your Human Resources manager: Telephone: (+48) 81-565-37-55 Email: [email protected] Recruited in this Terminated in this Total reporting period reporting period Number of direct 3,605 139 100 employees: Number of contracted 31 4 5 workers: Were there any collective Yes [ ] If Yes, please describe the redundancy plan, redundancies during the reporting No [X] including reasons for redundancies, number of period? workers involved, how they were selected, consultation undertaken, and measures to mitigate the effects of redundancy: Are any redundancies to the Yes [ ] If Yes, please describe the redundancy plan, workforce planned for the next No [X] including reasons for redundancies, number of year? workers involved, and selection and consultation process: Were there any changes in trade Yes[x] If Yes, please provide details, and summarise union representation at Company No [ ] engagement with trade unions during reporting plants during the reporting period: period? On July 29th 2020, the employment contract with the retiring Chairperson of the SOLIDNOŚĆ Intercompany Trade Union of Puławy Region Workers was terminated. In December 2020, a new Chairperson of the SOLIDNOŚĆ trade union was appointed.

Were there any other worker Yes [X] If Yes, please provide details and summarise representatives (e.g. in the No [ ] engagement with them during the reporting period: absence of a trade union)? There is a Works Council at the Company, which operates as a consultation body pursuant to the Act on the Provision of Information to Employees. 10

Were there any changes in the Yes [X] If Yes, please provide details: status of Collective Agreements? No [ ] By way of Supplement No. 35 to the Collective Bargaining Agreement, the ‘Rules for awarding Christmas bonuses to employees of Grupa Azoty Zakłady Azotowe Puławy S.A.’ and the ‘Rules for awarding Chemist’s Day bonuses to employees of Grupa Azoty Zakłady Azotowe Puławy S.A.’ were adopted. Have employees raised any Yes [ ] If Yes, please state how many, split by gender, grievances with the project during No [ x] summarise the issues raised in grievances by male the reporting period? and female staff and explain how the Company has addressed them: Have employees raised any Yes [ ] If Yes, please state how many, split by gender, complaints about harassment or No [X] summarise the issues raised by male and female bullying during the reporting staff and explain how the Company has addressed period? them:

Have there been any strikes or Yes[x] 1. Collective dispute of May 20th 2019 other collective disputes related No [ ] The NSZZ Solidarność Trade Union demanding to labour and working conditions payment of Chemist’s Day bonuses in amounts equal at the Company in the reporting to the average monthly remuneration paid by the period? Company in April 2019. As per our letter dated April 29th 2019.” Dispute ended on April 8th 2020 with an agreement.

2. Collective dispute of January 21st 2016 The Continuous Production Workers Trade Union demanding provision to GA ZAP employees of protective clothing, workwear and footwear ensuring safe and comfortable work, by November 30th 2020. Dispute ended on March 27th 2020 with an agreement.

3. Collective dispute of December 12th 2018 The Continuous Production Workers Trade Union demanding payment of Christmas bonuses in 2018. Dispute ended on March 27th 2020 with an agreement.

4. Collective dispute of November 29th 2019 The Continuous Production Workers Trade Union and Committee of the NSZZ Solidarność Trade Union demanding: 1. Discontinuation of payments to the Tarnów- based Grupa Azoty company for: - using that company’s trade mark - any media or graphic formats provided by that company 2. Limitation of contracts with third-party consultants and law firms to the level of the ‘Civic Platform party era’. 3. Decision to pay Christmas bonuses to employees in amounts calculated on the basis of the so- called Dr Bednarz algorithm, introduced unilaterally by the Company’s Management Board in the previous year. Dispute ended on April 8th 2020.

7. Occupational Health and Safety Data Please provide the name and Marcin Kopron – Head of Occupational Health and Safety, Email: contact details for your Health [email protected] and Safety manager: Tel. (+48) 81 565 2053 Direct Contracted Direct Contracted employees workers employees workers Number of man- 5,366,073 hours 1,687 hours Number of 0 0 hours worked in fatalities 7: this reporting period: Budget spent on PLN 11,560,644 Number of 0 0 OHS in this period disabling (total amount and injuries: currency): OHS training Training: blue- In 2020, 775 Number of Lost 31 0 provided in this collar workers – employees of Time Incidents period in person- 1,010 person- third-party (including days: days; contractors vehicular): managers – 328 working on GA person-days (164 ZAP’s premises persons); were trained (4 administrative hours per day and office staff – each). 97 person-days. Number of lost 998 0 Number of cases 0 0 workdays of occupational resulting from disease: incidents: Number of sick 41,295 54 days: Accident causes (falling, heavy loads, struck by object, contact with energy source etc.): Most accidents were related to movement (tripping, slipping), followed by those related to mechanical hazards and physical strain, as well as exposure to dangerous process media and steam. Other accidents, including those not related to workplace hazards, were least common.

Please provide details of any fatalities or major accidents that have not previously been reported to EBRD, including total compensation paid due to occupational injury or illness (amount and currency): No such occurrences

Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period: In 2020: − 9 persons participated in periodic training for chemical rescue teams, − 2 persons completed training for candidates for chemical rescue team members, − 78 employees of Grupa Azoty Puławy participated in training for operators of equipment isolating the respiratory tract (air systems), − 2 persons completed basic training for firefighters at the State Fire Service Central School in Częstochowa, − 2 persons completed a course of study at the Main School of Fire Service in Warsaw, majoring in fire safety engineering as Safety Engineers, − 9 persons commenced post-graduate courses at the Main School of Fire Service in Warsaw: “Professional training in positions related to the management of rescue operations”; − emergency procedures are also discussed at OHS training sessions; − the following employees received OHS training on emergency procedures, the use of gas masks, pre-medical first aid, evacuation procedures in case of an alarm signalling a chemical threat, and the rules of safe movement: o blue-collar workers – 1,010 persons (of whom 273 were trained remotely); o management personnel – 164 persons (of whom 99 were trained remotely); o administrative and office staff – 97 persons (of whom 35 were trained remotely). Moreover, as part of OHS training, training on the use of gas masks, first aid, evacuation procedure in case of an alarm signalling a chemical threat, and the rules of safe movement was provided to 2,600 employees. Please summarise any emergency response exercises or drills that have been carried out during the reporting period: In 2020, the following drills were performed: − 9 evacuation drills were held in buildings where more than 50 persons are employed permanently, − 16 chemical rescue drills with the participation of departmental chemical rescue teams and firefighters of the Company Fire Brigade, − twice during the year, loud tests of sirens on Grupa Azoty Puławy’s premises, on the last Mondays of March and September. Moreover, emergency response exercises and drills are carried out pursuant to Order No. 27 of the Governor of the Lublin Province – Head of the Provincial Civil Defence, dated March 26th 2014, amending the Order on Preparation and Ensuring the Operability of the Provincial Detection and Alarm System and the Provincial Early Warning System in the Lublin Province. In order to check the technical condition of the alarm equipment, alarm sirens are tested. In 2020, alarm sirens were sounded on: June 18th, August 1st, September 1st, September 17th, and December 17th. In the other months, at 12 noon on each Thursday of the month, a silent test of the sirens was performed (as part of the Provincial Early Warning System drill).

8. Stakeholder Engagement Please provide the name and contact details Katarzyna Hałat, Head of Corporate for your external relations or community Communication (Press Officer), e-mail: engagement manager: [email protected] Mobile phone: +48 81 565 21 76

Please provide information on the implementation of the Stakeholder Engagement Plan agreed with EBRD and summarise interaction with stakeholders during the reporting period, including:

• meetings or other initiatives to engage with members of the public or public organisations during the reporting period • information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: • coverage in the media: • interaction with any environmental or other community groups.

Please describe any changes to the Stakeholder Engagement Plan agreed with EBRD: 13

• meetings or other initiatives to engage with members of the public or public organisations during the reporting period; • distribution of the newsletter presenting all key areas of the Company’s and the Grupa Azoty Group’s operations; • content-related and financial support for environmental, patriotic and CSR inserts released by local press; • performance of the patronage agreement with the Technical School Complex in Puławy, under which Grupa Azoty PUŁAWY undertook to hire at least ten of each year’s school leavers; • continued partnership with the Puławy Branch of the Maria Curie Skłodowska University; • cooperation with the ‘Responsible Care’ Programme Secretariat with respect to initiatives undertaken by member companies; • cooperation with the Honorary Blood Donors Club at Grupa Azoty PUŁAWY with respect to blood donation sessions and registration of potential marrow donors; • partnership with the Municipal Social Welfare Centre in organising charitable donations for families in need; • continued partnership with the County Command of the State Fire Service and Voluntary Fire Brigades under the ‘Safety is Our Common Goal’ programme;

• information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: − information on the Company’s sponsorship and charitable giving activities; − interviews with a representative of the Company’s Management Board concerning various aspects of the Company’s operations; − information on aid granted by the Company to medical operators involved in the fight against COVID-19; − summary of the results of the blood donation drive run by the ‘Gift of Life’ Honorary Blood Donors Club at Grupa Azoty PUŁAWY; − information on activities carried out as part of the ‘Employee Volunteering Programme’ competition; − information on support provided to Voluntary Fire Brigades; − ‘We Play Clean’ information campaign highlighting the Company’s commitment to environmental protection and green initiatives;

• coverage in the media: − company on a solid financial footing; − company engaged in the region’s life; − company involved in fighting the coronavirus pandemic, − company looking for novel solutions based on research and development; − company undertaking large-scale projects to ensure its development and further optimal operation; − Grupa Azoty PUŁAWY as socially responsible company.

• Social dialogue − Dialogue Forum/Trade Unions Forum, i.e. regular meetings between the employer and all trade unions active at the Company, during which information on key aspects of Grupa Azoty Zakłady Azotowe Puławy S.A.’s operations is presented, and employee- oriented proposals and initiatives are discussed; − Collective Bargaining Agreement negotiation team – appointed by the Management Board of Grupa Azoty Zakłady Azotowe Puławy S.A. to discuss amendments to the provisions of the Collective Bargaining Agreement and to consult them with trade unions. The negotiations concern proposals put forward by the employer or by trade unions.

• Release of the Grupa Azoty Group’s Integrated Report for 2019, prepared in accordance with the GRI and IIRC standards.

How many complaints or grievances did the project receive from members of the public 14

or civil society organisations during the reporting period? Please split by stakeholder group. Summarise any issues raised in the complaints or grievances and explain how they were resolved:

No complaints were made with respect to the projects.

9. Community Development Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure:

An integral element of the Company’s strategy is to support the development of local communities in the following areas: Sports and healthy lifestyle In its initiatives promoting sports and healthy lifestyles, Grupa Azoty Zakłady Azotowe Puławy S.A. supported both professional sportspeople, as well as associations of sports enthusiasts and amateurs. In 2020, the Company continued its partnership with: • Azoty-Puławy handball club; • Wisła Puławy Sports Club; • Malwina Kopron; • Speedway Motor Lublin speedway club; • MKS Padwa Zamość. The Company also partnered with the ‘Azoty’ Yacht Club and the ‘Powiślak’ Końskowola sports club, and co-organised the 26th Polish Youth Indoor Olympic Games – ‘Lubelskie 2020’. Education Grupa Azoty Zakłady Azotowe Puławy S.A. continued its partnership with the ‘Chemik’ Technical School Complex and the Maria Curie-Skłodowska University in Lublin (the Puławy campus), whose curricula have been designed to match the skills and competencies needed in the chemical industry. The cooperation with the Maria Curie-Skłodowska University allows graduates of the Technical School Complex in Puławy to continue their education by taking relevant courses at the University, and the Company employees have the opportunity to advance their education through extramural studies.

Culture In 2020, the Company continued its partnership with the ‘Dom Chemika’ Puławy Culture Centre, the Lublin Music Theatre, and the Vistula Museum in Kazimierz Dolny. The Company took part in the celebrations of the 400th anniversary of the church organ in Kazimierz Dolny, which provided an opportunity to organise a number of musical performances. It also became involved in the celebrations of the 40th anniversary of the 1980 Lublin strikes and the 100th anniversary of the Battle of Warsaw. Grupa Azoty Puławy was the main strategic sponsor of the ‘The Pope and the Primate. Friendship Born in the Lublin Region’ television show made to commemorate the 100th anniversary of the birth of Saint John Paul II. The entire project was carried out in the Lublin region. As usual, the Company also partnered with the Provincial Culture Centre to participate in the Provincial Harvest Festival, promoting the Company as a brand with close ties to Poland’s rural areas, committed to their continuing development. Charitable activities The objective of charitable activities is to respond to the needs of local communities so as to make a real difference in the lives of their members. Such activities should be as extensive as possible, reaching those in need. Charitable activities are carried out by supporting institutions and citizens working for the public benefit in the areas of safety, education (in-kind donations or repairs performed for educational institutions), social welfare, protection and promotion of health, culture, art and environmental protection, including through support for local communities (family 15

festivals, summer camps) and promotion of physical activity, in particular among children, young people and the Company’s employees. In 2020, the Company actively joined efforts to fight the spread of COVID-19. The donated funds of approximately PLN 1.15m were used to purchase: − Specialist medical ambulance with equipment for the Independent Public Healthcare Centre in Puławy; − Specialist medical ambulance with equipment, equipment for emergency medical services, ultrasound machine and ventilator for the Independent Public Healthcare Centre in Puławy; − Diagnostic equipment for the Military Institute of Hygiene and Epidemiology in Warsaw; − Professional personal protective equipment for the Independent Public Clinical Hospital No. 4 in Lublin; − Medical and laboratory equipment for the Provincial Sanitary and Epidemiological Station in Lublin; − Professional protective masks for the staff and residents of residential care homes in the Świdnik County; − Cardiology equipment and apparatuses for the Health Centre in Mikołów; − Equipment for the Independent Public Clinical Hospital No. 1 in Lublin to set up a Temporary Hospital in Lublin; − Medical and personal protective equipment for the County Hospital in Ryki. The Company also provided its business cars to medical facilities and, together with the Puławy hospital, organised transport for convalescent plasma donors. Environmental protection initiatives In 2020, Grupa Azoty Zakłady Azotowe Puławy S.A. engaged in the following initiatives: • ‘We Play Clean’ environmental campaign – a series of environmental protection initiatives designed to promote: − Using bikes rather than cars to commute to work; − Waste segregation; − Information campaign on how to reduce environmental impacts; − Designation of one factory gate to be dedicated solely to bikes. Grupa Azoty Zakłady Azotowe Puławy S.A. also engaged in: • Looking after a peregrine falcon’s nest – the Company works with local ornithologists in looking after the nest boxes located on the CHP plant flue gas stack, as well as watching and ringing of falcon chicks; in 2020, another two peregrine falcon chicks hatched in the nest on the flue gas stack of the Puławy CHP plant. • Popularisation of ornithology – thanks to regular radio programmes on the Company’s radio run by one of its employees, other employees can learn about the bird species living on and around the Company’s premises, their behaviours and habits, and proper ways of caring for birds and feeding them. The radio programmes feature competitions with prizes. Once a quarter, employees of Grupa Azoty Zakłady Azotowe Puławy S.A. can participate in knowledge competitions focused on environmental protection and broadly defined safety, organised by the Secretariat of the Responsible Care Programme. Other initiatives In 2020, activities undertaken by Grupa Azoty Zakłady Azotowe Puławy S.A. for the benefit of local communities included: • A Christmas gifts drive for families in need organised in partnership with the Municipal Social Welfare Centre; Company employees collected Christmas gifts for twelve families under the Centre’s care; • Collecting plastic bottle caps – at the request from the Puławy hospice. Dedicated collection boxes have been placed on the Company’s premises for several years now. The caps brought by the Company’s staff are collected by hospice employees several times a year; 16

• Having in mind the safety of employees commuting to work by bike, the Company bought visibility vests for each employee, distributing a total of approximately 1.5 thousand vests; • Sponsoring prizes for participants of competitions organised in primary and secondary schools. In 2020, spending on social initiatives amounted to PLN 13.4m (contracts with sports clubs, donations, social sponsorship, prizes for competition participants).

ENVIRONMENTAL AND SOCIAL ACTION PLAN

Table 0.1 Wisła Project, Grupa Azoty Poland – Environmental, Social, Health and Safety (ESHS) matters, Updated (Alchemist Project) Action Plan:

GRUPA AZOTY ZAKŁADY AZOTOWE PUŁAWY S.A. No Action Environmental risks, Legislative Requirement/Resources Scheduled Target and Comments liabilities/benefits requirements/Be completion – action evaluation st practice to be completed by criteria for end of year implementation progress 3. Actions required to achieve compliance with national EHS legal requirements and EU environmental standards – ZA Puławy 3.1 Continue the upgrade Reduce environmental Legislative Investment needs 2020 Ensure that the In December 2015, requirements, of energy generation impact as required by project is the second stage of units to ensure future BAT conclusions for LCPs. best updated in the construction of management compliance with the annual report, deNOx units on BAT conclusions. practices, Bank's selected steam generators 4 As part of the BAT PRs technology and and 5 was Having completed assessment and energy emission targets. completed. The stage 1 of the management systems, selective non- upgrade, ZA Puławy further potential for 3 catalytic achieved 200mg/m reducing carbon dioxide Publish NTS of 3 reduction (SNCR) for SO2 and 20 mg/m emissions is assessed. the project and method allowed the for PM. provide Company to reduce Plans for stage 2 of Stage 2 of the copy/web link to NO emissions from the upgrade of energy upgrade of energy the Bank as part x steam generators 4 generation units to generation units of the annual and 5 to 200 mg/m3. ensure compliance report. 2022 Three steam with the BAT generators are conclusions for LCPs subject to include upgrades of derogations. In Q4 the Flue Gas 2016, a decision was Desulfurisation (FGD) made to construct a Unit and of steam catalytic deNOx generator 2. system for steam

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• - basic engineering design approved;

• - design documentation prepared;

• - disassembly of steam generator 2 commenced;

• - delivery and assembly of key equipment (including SCR) contracted.

In 2020, work was continued to upgrade steam generator 2 and the FGD Unit.

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3.2 Upgrade the WWTP/ Reduce environmental Legislative Investment needs 2015-26, as Obtain a permit In November 2017, a construct a new WWTP impact as required by requirements, required by to operate the study was prepared IED; best relevant new facility covering the management authorities Ensure progress management and practices, Bank's update in the discharge of all PRs annual report. wastewater streams generated on the Company premises. The concept will serve as the basis for selecting a contractor to design and construct the Central Biological Wastewater Treatment Plant. In 2018, a contractor was selected to perform specific tasks for the ‘Design and construction of the Central Biological Wastewater Treatment Plant’ project and an invitation to tender was issued to select a contractor for the ‘Design and construction of the

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No Action Environmental risks, Legislative Requirement/Resources Scheduled Target and Comments liabilities/benefits requirements/Be completion – action evaluation st practice to be completed by criteria for end of year implementation progress Central Biological Wastewater Treatment Plant‘ project. In 2020, work was continued to select a contractor for the design and construction of a central biological industrial wastewater treatment plant. As part of the work, laboratory and pilot tests were launched on discharged wastewater streams to select an appropriate treatment technology. Once completed, the project will enable the Company to meet the requirements defined in the BAT conclusions for

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3.3 Prepare a plan Reduce environmental Legislative Internal and external Ongoing Report on soil In 2017, an (including budget) and impact as required by requirements, and groundwater addendum to the conduct soil and IED. This will enable best status baseline report was groundwater surveys. assessment of baseline management drawn up. The study conditions and practices, Bank's involved a

identification of potential PRs comparison of receptors (both human historical soil and ecological). contamination data gathered through 2013-2014 surveys against currently applicable limits set down in the 2016 regulations. No soil contamination was identified on the Company premises. In 2020, the condition of groundwater was also inspected, with no contamination found.

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No Action Environmental risks, Legislative Requirement/Resources Scheduled Target and Comments liabilities/benefits requirements/Be completion – action evaluation st practice to be completed by criteria for end of year implementation progress 3.4 Review nitrate This will enable Best practice Own resources Completed Provide report A decrease of nitrate pollution data appropriate assessment (Report on the concentration in covering wooded areas of potential historical impact groundwater was near the plant. environmental issues of emissions, recorded. Report on Summarise it in a related to historical off- remedial actions the historical impact report that assesses site nitrate pollution. and current of emissions, historical, present and monitoring was remedial actions and future impacts and submitted in current monitoring determines whether February 2016) was submitted in the existing February 2016.

monitoring arrangements are adequate.

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Annual Environmental & Social Report

1. Information about the Company Company Name: Grupa Azoty Zakłady Azotowe Chorzów S.A. Company Address: ul. Narutowicza 15 Country: Poland Town/Location: 41-503 Chorzów Company authorised representative: 1)

I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period.

Signature:

Title: Head of the Management Board’s Office Date: April 15th 2021 Tomasz Krzemiński Contact Details: Telephone: (+48) 32-736 20 01 Mobile phone: 533,330,255 email: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide:

Item Cumulative

[PLN ‘000] 2019 2020

Revenue 37,219 48,398 Gross profit/(loss) 1,770 4,705 EBIT -14,840 -213 EBITDA -12,283 2,144 Net profit/(loss) -15,766 -1,025

Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions:

Number of staff employed and any change in employment over past 3 years As at Dec 31 As at Dec 31 As at Dec 31 2018 2019 2020 Number of direct employees: 173 131 123 Number of contracted workers: - - -

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive)

No new decisions for IPPC installations operated by the Company were issued in 2020.

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1. Integrated (IPPC) permits held by GA ZACH S.A.:

1.1. Integrated permit for the potassium nitrate and calcium nitrate production unit: • Decision by the Governor of the Katowice Province of May 7th 2007, No. ŚR – III – 6618/PZ/1478/21/06, • Decisions amending the integrated permit, i.e. Decision by the Marshal of the Katowice Province of March 31st 2010 No. 1162/OS/2010, Decision by the Marshal of the Katowice Province of June 7th 2011 No. 1684/OS/2011, Decision by the Marshal of the Katowice Province of November 26th 2014 No. 2587/OS/2014, Decision by the Marshal of the Katowice Province of May 13th 2015 No. 850/OS/2015, Decision by the Marshal of the Katowice Province of May 23rd 2017 No. 1567/OS/2017 (permit valid for unspecified period); 1.2. Integrated permit for the unit for processing of industrial-grade animal fats and vegetable oils into distilled fatty acids and stearin:

• Decision by the Marshal of the Katowice Province of August 22nd 2013 No. 1848/OS/2013, • Decisions amending the integrated permit, i.e. Decision by the Marshal of the Katowice Province of December 2nd 2014 No. 2769/OS/2014, Decision by the Marshal of the Katowice Province of March 21st 2017 No. 904/OS/2017 (permit valid for unspecified period).

2. Other environmental decisions held by Grupa Azoty Zakłady Azotowe Chorzów S.A. of Chorzów: 2.1. Permit to conduct waste recovery operations outside of installations (slag, waste code: ex 10 01 01) – Decision by the Mayor of Chorzów of March 22nd 2017, No. 5/2017, along with amending decision No. 2/2020 of February 24th 2020 (valid until March 31st 2027); 2.2. Decision by the Marshal of the Katowice Province of July 5th 2019 No. 1823/OS/2019 whereby a substance in the form of distillation residues of fatty acids from the processing of industrial-grade animal fats is considered a by-product which can be used as a fuel in the oil-fired boiler house (decision issued in 2019).

Reporting period: 2020

2. General Is the project materially compliant Yes [X] If No, please provide details of any material non- with all relevant EBRD Performance No [ ] compliances: Requirements (taking account of agreed action plans, exemptions or derogations)? Is the project materially compliant Yes [X] If No, please provide details of any material non- with all applicable environmental and No [ ] compliances: social laws and regulations?

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Have there been any accidents or Yes [x] If Yes, please describe, including details of actions to incidents that have caused damage to No [ ] remedy and prevent reoccurrence: the environment, brought about injuries or fatalities, affected project On August 24th 2020, a process-related incident labour or local communities, affected occurred at the potassium nitrate unit. A small amount cultural property, or created of semi-finished product leaked from the potassium liabilities for the company? nitrate synthesis reactor, causing skin burns on one employee and respiratory burn injuries on another. The accident took place inside a production facility, where most of the hazardous substance leaked from the reactor was contained in a spill tray, which prevented the contamination of soil or water. The substance was collected in special containers, the leakage was removed, and then both the affected area and the unit were restored to their original condition. Actions taken to prevent reocurrence of such incidents included: - Implementation of recommendations given by the accident investigation committee regarding preventive measures, including: o Discussing the circumstances and causes of the accident with entire staff, o Tightening supervision over the employees, o Provision of additional on-the-job OHS training, o Upgrading the housing of the transport mechanism, i.e. the screw conveyor with a feeder in R101 and R102 reactors (e.g. Plexiglas housing) by adding a component that can be opened / disassembled, o Moving the emergency safety shower station together with its housing, o Installing an additional safety button in work areas, o Protecting existing control boards against uncontrolled splashes, or replacing them with sealed control boards, o Installing video surveillance systems at all workstations and work areas, o Examining the technical feasibility of upgrading the production process – namely, process automation in locations which pose a potential risk to human life and health, o Consistently delivering the OHS and fire safety improvement programme adopted in 2015 and the Company’s OHS and fire safety Remediation Plan, as well as taking other relevant measures, within the available financial means, o Updating the ‘Process manual for potassium nitrate production’, with special emphasis put on the need to perform laboratory measurements of the concentration of a new batch of nitric acid added to the reactor from external tanks.

- Reorganisation of the Company in terms of safety management – the scope of responsibilities of the owners of OHS and fire safety processes was extended to encompass other related aspects, in order to ensure proper operation of an upper-tier establishment, - Issuance of Internal Order No. 31/2020 of November 5th 2020 (ref. No. GZ/395/2020) on information relating to an Upper-Tier Establishment, i.e. an establishment at risk of a major industrial accident,

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- Taking steps to update the Upper-Tier Establishment documentation, - Intensification of efforts to enhance employee awareness of the plant’s safety policy relating to prevention of major industrial accidents.

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Have there been any changes to Yes [X] If Yes, please describe: environment, social, labour or health No [ ] I.Environmental protection: and safety laws or regulations that 1. Regulation of the Minister of Climate of January 8th have materially affected the 2020 amending the Regulation on the types of results Company? of measurements performed in connection with the operation of units or equipment and other data, as well as the dates and manner of their presentation (Dz.U. of 2020, item 1443) 2. Act of January 23rd 2020 Amending the Waste Act and Certain Other Acts (Dz.U. of 2020, item 150) 3. Regulation of the Minister of Climate of January 2nd 2020 on Waste Catalogue (Dz.U. of 2020, item 10) 4. Regulation of the Minister of Marine Economy and Inland Navigation of January 20th 2020 on the form and manner of presentation of the results of measurements of groundwater and surface water samples, as well as the volume and quality of wastewater discharged into the ground or water (Dz.U. of 2020, item 144) 5. Regulation of the Minister of Internal Affairs and Administration of February 19th 2020 on fire protection requirements to be met by buildings, structures or parts thereof, and other locations used for collection, storage or treatment of waste (Dz.U. of 2020, item 296) 6. Act of May 14th 2020 Amending Certain Acts on Protective Measures in Connection with the Spread of SARS-CoV-2 (Dz.U. of 2020, item 875) 7. Regulation of the Minister of Climate of June 10th 2020 on the operation of the Product, Packaging and Waste Management Database (Dz.U. of 2020, item 1071) 8. Commission Regulation (EU) 2020/878 of June 18th 2020 amending Annex II to Regulation (EC) No 1907/2006 of the European Parliament and of the Council concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) (OJ L 220 of July 9th 2020, p. 11) 9. Act of May 28th 2020 Amending the Act on Chemical Substances and their Mixtures and Certain Other Acts (Dz.U. of 2020, item 1337) 10. Public Notice of the Minister of Climate of September 8th 2020 on the list of conurbations and cities with more than 100 thousand inhabitants where the average exposure indicator applying to conurbations and cities with more than 100 thousand inhabitants exceeds the exposure concentration limit, and the list of conurbations and cities with more than 100 thousand inhabitants where the average exposure indicator applying to conurbations and cities with more than 100 thousand inhabitants does not exceed the exposure concentration limit (M.P. of 2020, item 1420) 11. Regulation of the Minister of Climate of September 11th 2020 on specific requirements for waste storage (Dz.U. of 2020, item 1742) 12. Public Notice of the Minister of Climate of September 9th 2020 on the rates of environmental fees for 2021 (M.P. of 2020, item 961) 13. Regulation of the Minister of Climate of September

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24th 2020 on emission standards for certain installations, fuel combustion sources, as well as waste incineration and co-incineration facilities (Dz.U. of 2020, item 1860) 14. Regulation of the Minister of Climate and Environment of December 15th 2020 on the types of results of measurements performed in connection with the operation of units or equipment and other data collected through monitoring of technological processes, as well as the dates and manner of their presentation (Dz.U. of 2020, item 2405).

II. Social policy and labour law: 1. Regulation of the Council of Ministers of September 10th 2019 on the minimum remuneration for work and minimum hourly rate in 2020 – setting the minimum remuneration for work at PLN 2,600 (gross) and the minimum hourly rate payable to contractors and self- employed persons at PLN 17 (gross).

2. Amendments to Art. 281.2 of the Labour Code (effective as of December 1st 2020) and to Art. 282.3 of the Labour Code. The amendments extend the financial liability of employers engaging in unfair practices. The amendments were introduced by the Act of December 6th 2018 Amending Certain Acts to Improve the Enforcement of Child Maintenance Obligations. A fine of between PLN 1,500 and PLN 45,000 may be imposed on an employer or a person acting on the employer’s behalf in the event that: - the employer fails to confirm in writing an employment contract concluded with an employee who is subject to enforcement of child maintenance obligations and enforcement of state budget claims in respect of benefits paid by the state budget if the enforcement of child maintenance obligations was ineffective, and who is in arrears with the payment of such maintenance obligations for more than three months – Art. 281.2 of the Labour Code; - if the employer pays remuneration higher than specified in the employment contract, without any deduction to satisfy child maintenance obligations, to an employee who is subject to enforcement of child maintenance obligations and enforcement of state budget claims in respect of benefits paid by the state budget if the enforcement of child maintenance obligations was ineffective, and who is in arrears with the payment of such maintenance obligations for more than three months – Art. 282.3 of the Labour Code. 3. New regulation on the state of epidemic emergency caused by SARS-CoV-2 / COVID-19, imposing a number of obligations on the employer, entailing additional costs not foreseen when drafting the budget for 2020.

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How many inspections did you receive Number: 3 Please provide details of these visits, including from the environmental authorities number and nature of any violations found: during the reporting period? I. Inspection of the Katowice Provincial Inspectorate for Environmental Protection carried out from September 10th to September 30th 2020 with respect to: a. Compliance with the conditions regarding the quality and quantity of wastewater introduced into water or into the ground, as specified in relevant water-law permits and integrated (IPPC) permits, b. Inspection concerning prevention of major accidents. Violations found: No immediate notification of the occurrence of an emergency event at an upper-tier establishment. Following the inspection, the Katowice Provincial Inspectorate for Environmental Protection issued a requirement notice and an injunctive decision imposing i.a. the obligation to: - investigate the causes, course and consequences of a major accident related to the leakage of a hazardous substance during the industrial process at the potassium nitrate unit (decision implemented by the Company), - take steps to develop and implement a safety management system ensuring an adequate level of protection of people and the environment relevant to existing threats, forming part of the overall plant management system, and submit its description and constituent elements to the Katowice Provincial Inspectorate for Environmental Protection and to the Provincial Command Office of the State Fire Service in Katowice (decision implemented by the Company). Replies to the said notice and decision were sent on September 30th 2020 and December 14th 2020.

Furthermore, following its inspection the Provincial Inspectorate for Environmental Protection stated that ammonium nitrate should not be stored with other fertilizers and flammable substances. On the date of the inspection, the Provincial Inspectorate for Environmental Protection found that 5.2 Mg of ammonium nitrate was stored at the plant in the vicinity of other substances and fertilizers. Upon receipt of a written improvement notice, Grupa Azoty Zakłady Azotowe Chorzów S.A. took remedial action. The commercial product (ammonium nitrate) was moved to premises where no incompatible materials, such as fertilizers or any materials that are combustible or may react with ammonium nitrate, are stored.

II. Inspection by the Provincial Command of the State Fire Service in Katowice carried out from September 17th to September 23rd 2020.

SEVESO-related inspection.

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Following the inspection, follow-up recommendations and an administrative decision were issued, containing the following points:

1. Protecting the workstations of operators of the potassium nitrate reactors against release of the reaction mixture so as to eliminate the exposure of the unit’s staff to hazardous substances. 2. To follow up on requirement notice No. 114.2020 issued after the inspection by the Katowice Provincial Inspectorate for Environmental Protection on October 1st 2020 – reviewing and revising the procedures and manuals of the plant’s safety management system in order to ensure that appropriate measures are taken on an ongoing basis to prevent accidents and mitigate their impact. This includes, in particular, ensuring continuous supervision over proper performance of the obligations by an upper-tier establishment’s operator, ensuring the safe functioning and operation of the industrial facility, as well as specifying the rules for inspections and maintenance of the facility and its temporary shutdown. 3. Promptly notifying the Provincial Commander-in- Chief of the State Fire Service in Katowice of the findings of the investigation into the causes, course and consequences of the major accident, resulting from decision of the Katowice Provincial Inspectorate for Environmental Protection No. 1.2020 of September 16th 2020, and taking preventive action and measures at the plant to avoid reocurrence of similar events. 4. Updating the documents required under the Environmental Protection Law for an upper-tier establishment, i.e.: the Notification, Industrial Accident Prevention Programme, Safety Report and Internal Rescue Operation Plan, and incorporating in them lessons learned from the accident.

III. Inspection carried out by the Municipal Command of the State Fire Service in Chorzów

Inspection of compliance with fire prevention regulations – on September 17th 2020 and from September 24th 2020 to October 2nd 2020

Decision MZ.5586.1.20201.DWB 1. Obligation No. 1: Install smoke control devices or automatic smoke exhaust flap ventilators activated by the smoke detection system in staircases and lobbies serving as evacuation routes. 2. Obligation No. 2: Ensure that people can be evacuated from the inorganic production building through at least two stairways, which should be enclosed and separated from horizontal circulation or escape routes and other spaces by a fire-rated lobby. 3. Obligation No. 3: Ensure that the fire zone area for inorganic production buildings does not exceed 5,000 square metres.

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4. Obligation No. 4: Ensure fire resistance of the main components of the building’s load-bearing frame, roof, external walls, stairs and roof covering, so as to meet Class B fire rating for high production and storage facilities. 5. Obligation No. 5: Equip organic production buildings constituting a shared fire zone with hydrants and wet standpipes with 52 valves and the necessary supply of water stored in a fire tank. 6. Obligation No. 6: Ensure the required fire rating of the external wall in the space separating floors of the inorganic production building. 7. Obligation No. 7: Ensure the required width of horizontal escape routes in the staff amenity and office areas of no less than 1.2 metres. 8. Obligation No. 8: Install a fire protection switch in the organic production buildings constituting a single fire zone. 9. Obligation No. 9: Install emergency lighting systems in the organic production buildings: inside the organic production facility and fire escape routes. 10. Obligation No. 10: Provide a direct exit from the stairway leading outside of the building, with doors at least 1.2-metre wide. 11. Obligation No. 11: Ensure that the fire access route leading to the high inorganic production building ends with a manoeuvring yard (with an area of at least 20x20 metres), or provide other area to enable the manoeuvring of firefighting vehicles without the need to reverse them, as set out in the regulation on water supply and fire access routes.

Decision No. MZ.5586.4.2.2020.DB

Obligation No. 1: Install a fire protection switch in the adial/nitrous oxide storage facility located at 15 Narutowicza Street in Chorzów to disconnect power supply of all electrical systems, except for the power circuits supplying the facilities and equipment necessary to operate during a fire. Obligation No. 2: Repair the fire protection switch in the organic production facility located at 15 Narutowicza Street in Chorzów, and confirm its working order in a report drawn up by a qualified person. Obligation No. 3: Repair the fire protection switch in the boiler room located at 15 Narutowicza Street in Chorzów, and confirm its working order in a report drawn up by a qualified person.

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How many inspections did you Number: 3 Please provide details of these visits, including receive from the health and safety number and nature of any violations found: authorities during the reporting period? I. Inspection carried out on January 10th 2020 by the National Sanitary Inspectorate of the Chorzów County related to ongoing monitoring of the on-site occupational health conditions.

Inspection of compliance with the requirements of an administrative decision imposed on the Company.

No issues were raised. The inspection identified no violations.

II. Inspection carried out on March 2nd-11th 2020 by the National Labour Inspectorate of Katowice.

Inspection of compliance with the requirements of an administrative decision imposed on the Company.

No issues were raised. The inspection identified no violations.

III. Inspection carried out by the National Labour Inspectorate of Katowice on August 25th, 26th and 31st; September 4th, 11th and 28th; October 12th and 19th 2020; January 28th and February 3rd 2021 regarding, inter alia, occupational health and safety issues. Following the inspection, the National Labour Inspectorate of Katowice issued an injunctive decision and an improvement notice concerning the following OHS issues:

1. ENSURING AN ADEQUATE NUMBER OF STAFF PER SHIFT FOR THE PRODUCTION OF POTASSIUM NITRATE. Legal basis: - Art. 207.2.1 of the Labour Code of June 26th 1974 (Dz. U. of 2020, item 1320), Deadline: by April 30th 2021 Owner: Production Director Grounds: It was determined that during the accident there were staff shortages at the potassium nitrate unit, which impaired the process monitoring, especially in areas which need to be monitored on an ongoing basis.In addition, records in the related production reports showed that the potassium nitrate process did not conform to the process regime (in terms of reaction time), as set out in the applicable process manual.

2. DETERMINING AND PROPERLY DESCRIBING ALL UNDERLYING CAUSES OF ACCIDENTS AT WORK. Legal basis: - Par. 7.1 of the Regulation of the Council of Ministers of July 1st 2009 on determination of circumstances and causes of accidents at work (Dz.U. No. 105, item 870), Deadline: immediately. Owner: Accident investigation team

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3. FAIR DETERMINATION OF THE EMPLOYER’S NON- COMPLIANCE WITH APPLICABLE OHS RULES AND REGULATIONS WHEN INVESTIGATING THE CAUSES AND CIRCUMSTANCES OF ACCIDENTS AT WORK, IN KEEPING WITH THE ATTACHED SAMPLE POST-ACCIDENT REPORT. Legal basis: - Par. 9.1 of the Regulation of the Council of Ministers of July 1st 2009 on determination of circumstances and causes of accidents at work (Dz.U. No. 105, item 870), Deadline: immediately. Owner: Accident investigation team

4. IDENTIFYING PERSONAL PROTECTIVE EQUIPMENT TO BE USED IN EMERGENCY SITUATIONS BY THE POTASSIUM NITRATE PRODUCTION STAFF, AND ENSURING ITS ACTUAL USE. Deadline: immediately enforceable pursuant to Art. 108.1 of the Code of Administrative Procedure of June 14th 1960 (Dz.U. of 2020, item 256, as amended, and of 2020, item 2320), as necessary for the protection of human health or life. Owner: Production Director; OHS unit Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 2376.1 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320), - Par. 8.1 and 8.2.4 of the Regulation of the Minister of Health of December 30th 2004 on occupational health and safety at work involving the exposure to chemical agents (Dz.U. of 2016, item 1488),

5. UPDATING THE PROCESS MANUAL FOR THE PRODUCTION OF POTASSIUM NITRATE AND OPERATION MANUAL FOR CARBONATE REACTORS IN TERMS OF UNIFORM REQUIREMENTS RELATING TOFEEDSTOCKS USED (INCLUDING NITRIC ACID) AND PERSONAL PROTECTION EQUIPMENT (INCLUDING PPE USED IN EMERGENCY SITUATIONS). Deadline: March 31st 2021 Owner: Production Director Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 2374.2 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320), 6. ENSURING THAT COMPLETE REQUIRED ANALYSIS OF THE FEEDSTOCKS USED IN THE PRODUCTION OF POTASSIUM NITRATE IS CARRIED OUT. Deadline: immediately enforceable pursuant to Art. 108.1 of the Code of Administrative Procedure of June 14th 1960(Dz.U. of 2020, item 256, as amended, and of 2020, item 2320), as necessary for the protection of human health or life.

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Owner: Production Director Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 207.2.2 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320),

7. INSTALLING INSTRUMENTATION AND CONTROL DEVICES IN EXTERNAL NITRIC ACID STORAGE TANKS TO PROVIDE ONGOING READINGS OF THE QUANTITY OF ACID IN A TANK. Deadline: March 31st 2021 Owner: Production Director; Technical Director; Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 207.2.2 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320), - Par. 95.1.2 of the Regulation of the Minister of Labour and Social Policy of September 26th 1997 on general occupational health and safety regulations (Dz.U. of 2003, No. 169, item 1650, as amended, and of 2011 No. 173, item 1034),

8. ENSURING THAT THE POTASSIUM NITRATE PRODUCTION PROCESS IS CARRIED OUT IN ACCORDANCE WITH THE PROCESS REGIME SET OUT IN THE PROCESS MANUAL. Deadline: immediately enforceable pursuant to Art. 108.1 of the Code of Administrative Procedure of June 14th 1960 (Dz.U. of 2020, item 256, as amended, and of 2020, item 2320), as necessary for the protection of human health or life. Owner: Production Director; Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 207.2.2 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320), - Par. 11.1 of the Regulation of the Minister of Health of December 30th 2004 on occupational health and safety at work involving the exposure to chemical agents (Dz.U. of 2016, item 1488),

9. INSTALLING A VIDEO SURVEILLANCE SYSTEM FOR THE AREA OF EXTERNAL NITRIC ACID STORAGE TANKS AND THE AREA OF POTASSIUM NITRATE REACTORS.

Deadline: March 31th 2021 – > Completed Owner: Production Director; Technical Director; Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 207.2.1 of the Labour Code of June 26th 1974 (Dz. U. of 2020, item 1320), - Par. 99.1.6 of the Regulation of the Minister of

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Labour and Social Policy of September 26th 1997 on general occupational health and safety regulations (Dz.U. of 2003, No. 169, item 1650, as amended, and of 2011 No. 173, item 1034),

10. INSTALLING A LIGHT, HINGED COVER AT THE ENTRY INTO POTASSIUM NITRATE REACTORS. Deadline: March 31st 2021 Owner: Production Director; Technical Director; Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 216.1 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320),

11. INSTALLING DEVICES TO PREVENT SUDDEN LEAKAGE OF THE SOLUTION FROM POTASSIUM NITRATE REACTORS. Deadline: March 31st 2021 Owner: Production Director; Technical Director; Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 216.1 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320), - Par. 95.1.2 of the Regulation of the Minister of Labour and Social Policy of September 26th 1997 on general occupational health and safety regulations (Dz.U. of 2003, No. 169, item 1650, as amended, and of 2011 No. 173, item 1034),

12. ENSURING THAT DOCUMENTED INSPECTIONS OF MACHINERY AND EQUIPMENT OF THE POTASSIUM NITRATE PRODUCTION LINE ARE CARRIED OUT PERIODICALLY. Deadline: March 31st 2021 Owner: Production Director; Technical Director; Legal basis: - Art. 11.1 of the Act on National Labour Inspectorate of April 13th 2007 (Dz.U. of 2019, item 1251), - Art. 215 of the Labour Code of June 26th 1974 (Dz.U. of 2020, item 1320), - Par. 26 and 28.1 of the Regulation of the Minister of Economy of October 30th 2002 on the minimum occupational health and safety requirements for the operation of machinery by employees at work (Dz.U. No. 191, item 1596, as amended in 2003, No. 178, item 1745),

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How many inspections did you Yes [x] If Yes, please describe, including status of receive from the labour authorities Number: implementing corrective actions to address any during the reporting period? 2 violations found: No [ ] I. Inspection carried out in March 2020 by the National Labour Inspectorate of Katowice regarding legal protection of labour and occupational health and safety issues. Following the inspection, the National Labour Inspectorate of Katowice issued an injunctive decision and an improvement notice: LABOUR LAW: 1. The managers of organisational units and heads of divisions were obligated not to allow any employees to work without a valid certificate of having completed periodic OHS training. 2. The OHS personnel were advised of the obligation to verify the content of completed induction training sheets. 3. The managers of organisational units and heads of divisions were obligated not to allow any employees to work without prior on-the-job training. 4. The relevant employee’s personal file was supplemented to include an OHS induction training sheet, confirming completed on-the-job training as a Boiler Room Operator. 5. The relevant employee’s personal file was supplemented to include a document outlining the scope of duties for a Boiler Room Operator. 6. The managers of organisational units and heads of divisions were obligated not to allow any employees to work without a valid health certificate. 7. The relevant employee’s personal file was supplemented to include a certificate of completion of periodic OHS training for employees and managers. 8. The managers of organisational units and heads of divisions were obligated to accurately record the actual working time of their subordinates. 9. The managers of organisational units and heads of divisions were obligated to re-examine the working time of the employees inspected by the Labour Inspector and, if their working time exceeded the applicable limits, to calculate and pay out additional remuneration together with an allowance for overtime work, by December 31st 2020. 10. The managers of organisational units and heads of divisions were obligated to strictly adhere to the 11- hours’ uninterrupted daily rest period guaranteed to all employees. 11. The accident investigation team were informed of the obligation to review the post-accident report in terms of a written acknowledgement of its receipt by the injured person. 12. The managers were advised of the obligation to immediately inform the OHS unit of any accidents at work. II. Inspection carried out by the National Labour Inspectorate of Katowice in August 2020 in connection with the accident described in the respective report,

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with administrative instructions issued to the OHS personnel, Production Director and Technical Director. Have these visits resulted in any Yes[x] If Yes, please describe, including status of penalties, fines and/or corrective No [ ] implementing corrective actions to address any action plans? violations found: The inspection by the National Labour Inspectorate resulted in a fine being imposed on the Production Director for improper organisation of the work. Corrective action is in progress.

Has the Company engaged any Yes [ ] If Yes, please state for which types of work, and how contractors for project-related work No [X] the Company has monitored the compliance of in the reporting period? contractors with EBRD Performance Requirements and the Environmental and Social Action Plan:

Yes [ ] If Yes, please provide details, including how the Were any of the violations stated No [X] Company is ensuring that corrective actions are above the responsibility of implemented by the contractor? contractors?

Have any operations been reduced, Yes [x] If Yes, please describe: temporarily suspended or closed down No [ ] Implementation of the OHS and fire safety due to environmental, health, safety improvement plan lost momentum due to SARS-CoV-2 or labour reasons? (COVID-19). Please describe any environment or social programmes, initiatives or sub-projects undertaken during the reporting period to improve the Company's environmental or social performance and/or management systems:

In November 2020, the certification body TUV NORD Polska Sp. z o.o. carried out a recertification audit at the Company for compliance with the PN-EN ISO 14001:2015 standard. The audit was completed with positive results.

PLN 8,500.00 net (expenditure related to the recertification audit of the ISO 14001:2015-compliant system)

4. Environmental Monitoring Data for each of the key subsidiaries The information required in this section can be extracted from a CSR report, or a full CSR report can be attached.

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Please provide the name and contact details for your environmental Grupa Azoty Zakłady Azotowe manager: Chorzów S.A. 1.General environmental protection area: Justyna Tańska Chief Environmental Protection Officer Mobile: (+48) 570 250 799 email: [email protected] m;

2. Specific area relating to water and wastewater management: Patryk Jankowski Head of Water and Water Management Mobile: 506286598 email: [email protected] om

Parameter2 Amount3 Unit Compliance Comments5 Status4 Wastewater Total wastewater 210 m3/d 535 m3/d Biochemical Oxygen Demand 8.98 mg O2/l 25 (BOD5) Chemical Oxygen Demand 39.72 mg O2/l 125 (COD) Total suspended 18.23 mg/l 35 solids Total phosphorus 0.59 mg/l 2 Ammonium 0.60 mg/l 10 nitrates Nitrate nitrogen 6.08 mg/l 30 Nitrite nitrogen 0.83 mg/l 1 Total nitrogen 9.65 mg/l 30 Chlorides 130.83 mg/l 1000 Sulfates 74.67 mg/l 500 Petroleum 13.33 mg/l 15 hydrocarbons Heavy metals [Other] 7.93 6.5-9 pH

Permissible Per each major point source mg/Nm3 Not applicable emission Air emissions Boilers in mg/m3 to the project u limit 3 3 K2 K3 K4 K5 mg/m u mg/m u 64.4 76.5 1,084.0 1,079.0 K2 = 850 On an O 97.0 118.0 730.0 698.0 K3 = 850 2 SO mg/m3 content in flue 2 u K4 = 1,500 gas basis K5 = 1,300 (K2 and K3 – 3%, Nitrogen oxides 303.0 321.0 312.0 367.0 3 mg/m u 400 K4 and K5 – 6%) (NOX) 375.0 378.0 314.0 361.0

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12.0 8.6 88.0 77.0 K2 = 50 9.0 11.2 58.0 56.0 K3 = 50 PM mg/m3 u K4 = 100 K5 = 100 26.7 34.2 255.0 214.0 --- CO mg/m3 --- 26.2 46.0 236.0 211.0 u 284.0 284.0 285.0 267.0 ------CO g/m3u 2 287.0 289.0 286.0 267.0 n/a n/a p.o. p.o. ------BaP mg/m3 n/a n/a p.o. p.o. u Other parameters Results of the measurements carried out in Noise does not 2020 cannot be used as a basis for assessing exceed the acoustic conditions of the environment, as permitted levels the noise level is indistinguishable from background sound levels. Noise emissions L [dBA] 45-55 Aeg Calculating the equivalent sound level during reference time T: Daytime: 29.6 – 38.4 Night time: 29.6 – 38.4

Solid waste Please provide details of the types and amounts of solid wastes generated by the project. Indicate where wastes are classified as hazardous. Indicate the final re-use, recycle or disposal method for each waste type.

No. Waste code Waste type Weight of waste generated [Mg/year]

Solid salts and solutions other than those 1. 06 03 14 0.000 mentioned in 06 03 11 and 06 03 13 2. 06 10 02* Wastes containing hazardous substances 192.340 3. 06 10 99 Wastes not otherwise specified 366.740 Sludges from onsite effluent treatment other 4. 07 06 12 87.82 than those mentioned in 07 06 11 5. 07 06 80 Bleaching earth from oil refining 0.000 Bottom ash, slag and boiler dust (excluding 6. 10 01 01 577.000 boiler dust mentioned in 10 01 04) 7. 10 01 04* Oil fly ash and boiler dust 0.000 8. 12 01 13 Welding wastes 0.000 Mineral-based non-chlorinated engine, gear 9. 13 02 05* 0.000 and lubricating oils 10. 15 01 01 Paper and cardboard packaging 1.300 11. 15 01 02 Plastic packaging 17.730 12. 15 01 03 Wooden packaging 7.710 Packaging containing residues of or 13. 15 01 10* 4.760 contaminated by hazardous substances Absorbents, filter materials (including oil filters not otherwise specified), wiping cloths, 14. 15 02 02* 0.000 protective clothing contaminated by dangerous substances (e.g. PCB) Absorbents, filter materials, wiping cloths and protective clothing other than those 15. 15 02 03 0.200 mentioned in 15 02 02

16. 16 01 19 Plastics 0.000 17. 16 02 13* Discarded equipment containing hazardous 0.000

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components(1) other than those mentioned in 16 02 09 to 16 02 12 Laboratory chemicals (e.g. chemical reagents) consisting of or containing dangerous 18. 16 05 06* 1.060 substances, including mixtures of laboratory chemicals Spent catalysts containing transition metals or 19. 16 08 03 transition metal compounds other than those 0.000 mentioned in 16 08 02 Glass, plastic and wood containing or 20. 17 02 04* contaminated with dangerous substances (e.g. 0.000 wooden sleepers) 21. 17 04 05 Iron and steel 29.347 Mixed construction and demolition wastes 22. 17 09 04 other than those mentioned in 17 09 01, 17 09 1.580 02 and 17 09 03

An asterisk (*) is used to denote hazardous waste. All waste is recovered or disposed of by external contractors. Furthermore, non-hazardous waste designated with code 10 01 01 is used for surface paving on GA ZACH S.A.’s premises, which is consistent with the terms of the permit held by the Company.

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5. Resource Usage and Product Output Measureme Parameter Amount Comments6 nt Unit Heavy fraction (boiler house) and Fuels used 36.904 Mg gasoline, diesel oil, LPG – total for all departments Crude oil ------Natural gas 0.0 thousand m3 --- Hard coal 4,873.22 Mg --- Lignite ------Grid electricity 4,534.516 MWh --- Heat purchased from ------external sources Feedstocks and raw materials used Nitric acid 6,004.9 Mg --- Potassium carbonate 5,677.3 Mg --- Animal fat 0.000 Mg --- Quick lime 822.6 Mg --- Hydrated lime 49.5 Mg --- Other feedstocks for crystalline NPK 668.4 Mg --- fertilizers Other feedstocks for 6.75 Mg --- liquid NPK fertilizers Product output Potassium nitrate 6,431.3 Mg --- Calcium nitrate 4,213.0 Mg --- Crystalline NPK 591.4 Mg --- fertilizers Liquid NPK fertilizers 11.2 Mg --- Stearin 0.000 Mg --- Glycerine 0.000 Mg ---

6. Human Resources management Please provide the name and contact details for Magdalena Czajkowska your Human Resources manager: Head of HR Department Mobile phone: (+48) 575 100 182 Email: [email protected] Recruited in this Terminated in this Total reporting period reporting period Number of direct employees: 123 31 38 Number of contracted - - - workers: If Yes, please describe the redundancy plan, Were there any collective Yes [ ] including reasons for redundancies, number of redundancies during the reporting No [X] workers involved, how they were selected, period? consultation undertaken, and measures to mitigate the effects of redundancy: If Yes, please describe the redundancy plan, Are any redundancies to the Yes [ ] including reasons for redundancies, number of workforce planned for the next No [X] workers involved, and selection and consultation year? process: Were there any changes in trade If Yes, please provide details, and summarise Yes [x] union representation at Company engagement with trade unions during reporting No [X] plants during the reporting period? period:

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Were there any other worker Yes [ ] If Yes, please provide details and summarise representatives (e.g. in the absence No [X] engagement with them during the reporting period: of a trade union)? Were there any changes in the Yes [ ] If Yes, please provide details: status of Collective Agreements? No [X] If Yes, please state how many, split by gender, Have employees raised any Yes [ ] summarise the issues raised in grievances by male grievances with the project during No [X] and female staff and explain how the Company the reporting period? has addressed them: If Yes, please state how many, split by gender, Have employees raised any Yes [ ] summarise the issues raised by male and female complaints about harassment or No [X] staff and explain how the Company has addressed bullying during the reporting period? them: Have there been any strikes or other collective disputes related to labour Yes [ ] If Yes, please summarise nature of, and reasons for, and working conditions at the No [X] disputes and explain how they were resolved: Company in the reporting period? If Yes, please summarise the issues contested Have there been any court cases and outcome: Yes [x] related to labour issues during the 1. Ineffective dismissal. No [ ] reporting period? 2. Workplace bullying (mobbing) – case pending, 2nd instance.

Have there been any changes to the following policies or terms and conditions during the reporting period in any of the following areas: − Trade union recognition − Collective Agreements − Non-discrimination and equal opportunities for all − Equal pay for equal work − Gender equality If Yes, please give details, including of any new − Bullying and harassment, Yes [ ] initiatives: including sexual harassment No [X] − Employment of young workers under 18 − Wages and salaries (for regular and overtime hours) − Overtime − Working hours − Flexible working / work-life balance − Grievance mechanism for workers − Health & safety

7. Occupational Health and Safety Data

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Please provide the name and Paweł Polak contact details for your Health Chief OHS Officer and Safety manager: Firefighting technical specialist Civil Defence Inspector SEVESO Coordinator Mobile: (+48) 533 330 256 Email: [email protected] Direct Contracted Direct Contracted employees workers employees workers Number of man- 198,714 hours hours worked in worked/134.00 Number of 0 0 0 this reporting per month per fatalities 7: period: person Budget spent on Number of OHS in this period PLN 280,000.00 0 disabling 0 0 (total amount and injuries: currency): OHS training Number of Lost provided in this 46 persons/ 40 Time Incidents 0 6 0 period in person- days (including days: vehicular): Number of lost 395 calendar Number of cases workdays days 0 of occupational 0 0 resulting from 272 working days disease: incidents: 395 calendar Number of sick days 0 days: 272 working days Accident causes (falling, heavy loads, struck by object, contact with energy source etc.):

• startled by an unexpected event, • work performed under artificial lighting, • work performed in a forced body position, • work performed at night, • noise coming from another shop floor location, • mismanaged production process.

not applicable

Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period:

Fire prevention training, including the Plant’s UTE/LTE status, in accordance with the training programme approved by the Employer.

Please summarise any emergency response exercises or drills that have been carried out during the reporting period:

In-house evacuation drills, including an alertsounded using an alarm siren and short text messages.

8. Stakeholder Engagement

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Please provide the name and contact details Joanna Gruszka for your external relations or community QMS Officer engagement manager: Telephone: (+48) 32/73 62 000 Mobile phone: (+48) 533 929 490 Email: [email protected] Please provide information on the implementation of the Stakeholder Engagement Plan agreed with EBRD and summarise interaction with stakeholders during the reporting period, including: − meetings or other initiatives to engage with members of the public or public organisations during the reporting period − information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: − coverage in the media: − interaction with any environmental or other community groups. Please describe any changes to the Stakeholder Engagement Plan agreed with EBRD:

Grupa Azoty Zakłady Azotowe Chorzów S.A. has no Stakeholder Engagement Plan in place.

There were no such issues.

9. Community Development Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure:

The Company made a donation of PLN 12,767.40 to the Municipal Command Office of the State Fire Service in Chorzów. GA ZACH S.A. has partnered with the Starochorzowska Fundacja Zdrowia foundation, which performs medical check-ups of its employees as part of preventive healthcare.

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ENVIRONMENTAL AND SOCIAL ACTION PLAN

Table 0.1 Wisła Project, Grupa Azoty Poland – Environmental, Social, Health and Safety (ESHS) matters, Updated (Alchemist Project) Action Plan:

GRUPA AZOTY ZAKŁADY AZOTOWE CHORZÓW S.A.

6. Actions required to maintain compliance with EHS requirements of national law and EU environmental standards – GRUPA AZOTY ZAKŁADY AZOTOWE CHORZÓW S.A. Schedule d Target and completio Legislative evaluation Environmental risks, Requirement/Res n – action No. Action requirements/Bes criteria for Comments liabilities/benefits ources to be t practice implementation complete progress d by end of year 0.1 Objective to achieve the OHS and fire safety control of Requirements Internal resources In Conduct business It is necessary same safety performance as individual areas with respect to under the OHS and available for accordan in accordance to secure in 2018 (when no accidents potential risks affecting the fire safety supervision, ce with with the adequate at work occurred). pursuit of business objects. regulations, good control and the applicable laws financial practice, internal documentation Developm and regulations, resources for regulations. (not applicable to ent Plan as well as the material agents). for established implementatio 2020−202 standards and n of specific 2 practice actions. adequate to the business profile and adjacent infrastructure.

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0.2 Maintain and further develop Fostering solid patterns and Legal Internal resources As Certification of --- the existing management attitudes confirmed by requirements. available for needed. systems and systems. appropriately implemented and Best practice. supervision, raising staff control and awareness – on Improve OHS and fire safety supervised management systems documentation an as needed infrastructure. applicable in each area, i.e. OHS, fire safety and environmental (not applicable to basis. protection. material agents).

0.4 Incur expenditure to perform Securing adequate financial Requirements Internal As Regular --- resources that will allow the under the resources/ needed. monitoring of the Company’s OHS, fire safety and environmental Company to perform its applicable laws, specialised implementation. obligations. obligations, including the pursuit of regulations, EU external entities. its business objects. directives and administrative decisions. 6.1 Prepare the Upper-Tier Update of legal compliance status Legal Internal 2018- UTE COMPLETED Establishment concerning prevention of major requirements resources/ 2019 documentation Subject to documentation. industrial accidents. relating to specialised (ongoing) approval process regular prevention of external entities. is currently monitoring major industrial under way accidents under before the competent Environmental authorities Protection Law. (Provincial Command of the State Fire Service in Katowice and Provincial Inspectorate for Environmental Protection in Katowice)

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6.3 Secure approval for the Update of legal compliance status Legal Internal 2019- UTE COMPLETED Upper-Tier Establishment concerning prevention of major requirements resources/ 2020 documentation documentation. industrial accidents. relating to specialised (ongoing) approval process prevention of external entities. is currently major industrial under way before accidents under competent the authorities Environmental (Provincial Protection Law. Command of the State Fire Service in Katowice and Provincial Inspectorate for Environmental Protection in Katowice)

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Annual report

1. Information about the Company Company Name: Grupa Azoty Zakłady Fosforowe Gdańsk Sp. z o.o. Company Address: ul. Kujawska 2, 80-550 Gdańsk Country: Poland Town/Location: Gdańsk Company authorised representative: Renata Tyszer I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period. Signature:

Date: April 15th 2021 Title: Vice President of the Management Board Contact Details: Telephone: +48 058 34 38270 Email: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide:

Item Cumulative

[PLN ‘000] 2019 2020

Revenue 250,594 182,407

Profit/(loss) on sales 18,063 1,704 EBIT 18,845 3,918 EBITDA 31,639 17,058 Net profit/(loss) 13,888 1,518

Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions;

Number of staff employed and any change in employment over past 3 years

As at As at Dec 31 As at Dec 31 Dec 31 2018 2019 2020 Number of direct employees: 289 307 281 Number of contracted workers: 0 0 0

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive)

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Reporting period: 2020

2. General Is the project materially compliant Yes [X] If No, please provide details of any material non- with all relevant EBRD Performance compliances: Requirements (taking account of agreed action plans, exemptions or derogations)? Is the project materially compliant Yes [X] If No, please provide details of any material non- with all applicable environmental compliances: and social laws and regulations? Have there been any accidents or No [X] If Yes, please describe, including details of incidents that have caused damage actions to remedy and prevent reoccurrence: to the environment, brought about injuries or fatalities, affected project labour or local communities, affected cultural property, or created liabilities for the Company? Have there been any changes to No [X] If YES, please describe: environment, social, labour or health and safety laws or regulations that have materially affected the Company? How many inspections did you Number: 0 Please provide details of these visits, including receive from the environmental number and nature of any violations found: authorities during the reporting period? How many inspections did you Number: 3 Please provide details of these visits, including receive from the health and safety number and nature of any violations found: authorities during the reporting period? In 2020, three inspections were carried out by: National Labour Inspectorate (PIP) – several issues raised orally, discussed; Sanitary Inspectorate – no issues raised; State Fire Service (PSP) – recommendation to re- measure water flow at an industrial unit. How many inspections did you Number: 1 Please provide details of these visits, including receive from the labour authorities number and nature of any violations found: during the reporting period? Following the inspection by the National Labour Inspectorate (PIP), no violations were found. Have these visits resulted in any No [X] If Yes, please describe, including status of penalties, fines and/or corrective implementing corrective actions to address any action plans? violations found:

Has the Company engaged any No [X] If Yes, please state for which types of work, and contractors for project-related work how the Company has monitored the compliance in the reporting period? of contractors with EBRD Performance Requirements and the Environmental and Social Action Plan:

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No [X] If Yes, please provide details, including how the Were any of the violations stated Company is ensuring that corrective actions are above the responsibility of implemented by the contractor? contractors?

Have any operations been reduced, Yes [X] If Yes, please describe: temporarily suspended or closed down due to environmental, health, Suspended evacuation drill – reason: safety or labour reasons? SarsCov-2. Please describe any environment or social programmes, initiatives or sub-projects undertaken during the reporting period to improve the Company's environmental or social performance and/or management systems: cU

Not applicable.

4. Environmental Monitoring Data for each of the key subsidiaries The information required in this section can be extracted from a CSR report, or a full CSR report can be attached. GA FOSFORY Sp. z o.o. has no CSR policy in place.

Please provide the name and contact details Environmental Protection and Chemical Safety for your environmental manager: Officer Lidia Wilczewska-Treder Telephone: (+48) 58 343 383 12 Mobile: (+48) 669 600 394 [email protected]

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Compliance Status4 Permissible level specified in Integrated (IPPC) Permit DROŚ- SO.7222.45.2013/2014.BA of August 1st 2014, as amended by Decision DROŚ- SO.7222.60.2014.EŻ of December Parameter2 Amount3 Unit 4th 2014 and Decision DROŚ- Comments5 SO.7222.81.2017.EŻ of August 24th 2018 issued by the Marshal of the Gdańsk Province

Wastewater

Most of the 9,740,679 26,532,000 m3/year Total wastewater m3/year wastewater is 9,059,998 No exceedance of permissible cooling water. limits was found.

Biochemical Oxygen Demand (BOD5) ---- mg/l -

None Chemical Oxygen Demand (COD) ---- mg/l -

Suspended solids average 26.1 35 mg/l maximum 34.4 No exceedance of the permissible mg/l None average 27.5 single measurement or average maximum 29.0 annual limits was found. Phosphorus GA FOSFORY Sp. z o.o. does not - - monitor phosphate levels in None industrial wastewater. Nitrates GA FOSFORY Sp. z o.o. does not - - monitor nitrate levels in None industrial wastewater. Heavy metals GA FOSFORY Sp. z o.o. does not - - monitor heavy metal levels in None industrial wastewater. Petroleum hydrocarbons average 0.06 15 mg/l maximum No exceedance of the permissible mg/l None 0.019 single or average annual limits average 0.39 was found. maximum 1.12 pH minimum 7.1 maximum 8.3 minimum 7.1 - . None maximum 8.2

Temperature 35 °C maximum 31.8 No exceedance of the permissible maximum 31.0 °C None single measurement limits was

found.

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Air emissions

Type of Major point Mg/year substance source

SO 157.40 Mg/year 2 Manufacture of 19.09 No exceedance of the permissible None fertilizers 11.67 limits was found. 156.50 Mg/year Manufacture of 95.16 No exceedance of the permissible None sulfuric acid 97.80 limits was found. 0.14 No permissible limits have been Boiler house None 0.05 defined. Nitrogen oxides 88.98 Mg/year Manufacture of 38.63 (NO ) No exceedance of the permissible None X fertilizers 36.66 limits was found. 3.40 Mg/year Manufacture of 1.67 No exceedance of the permissible None sulfuric acid 1.75 limits was found. 0.37 No permissible limits have been Boiler house None 0.13 defined. Particulates 35.13 Mg/year Manufacture of 20.62 35.50 Mg/year None fertilizers 15.62 No exceedance of the permissible limits was found. Fertilizer 0.16 No permissible limits have been None compaction 0.11 defined. 0.20 No permissible limits have been Boiler house None 0.07 defined. CO 2 131.87 No permissible limits have been Boiler house None 46.38 defined. Fluorine 6.16 Mg/year Manufacture of 0.44 No exceedance of the permissible None fertilizers 0.54 limits was found. CO 8.94 Mg/year Manufacture of 6.30 No exceedance of the permissible None fertilizers 8.38 limits was found. 0.04 No permissible limits have been None Boiler house 0.01 defined. Sulfuric acid Manufacture of 12.18 Mg/year 4.65 sulfuric acid No exceedance of the permissible None 4.05 limits was found.

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Other parameters

Noise emissions Process 47-50 [dB] downtime 48-49 [dB] Daytime Production 53-61 [dB] Permissible noise levels for run 58-62 [dB] residential areas. Noise emissions from the GA Fosfory facilities None Night Process 46-51 [dB] have no impact on the time downtime 46-47 [dB] neighbouring residential areas. Production 52-61 [dB] run 57-59 [dB]

Solid waste Waste type Quantity of Waste code generated waste

[Mg]

Wastes not otherwise specified 3.580 06 01 99 None (here: waste sulfur) 9.880

None Rubber waste from production 19.523 07 02 80 unit overhaul 11.620

None

Mineral-based non-chlorinated 1.240 engine, gear and lubricating 13 02 05* 1.540 oils

32.920 Plastic packaging 15 01 02 None 44.396

None Wiping cloths, oil filters, and 1.060 protective clothing 15 02 02* 0.000 contaminated by oil

None Absorbents, filter materials, 0.300 15 02 03 wiping cloths (filter cloths) 1.540

Discarded equipment Noexceedance of the permissible limits was found. None containing hazardous components other than those 0.035 16 02 13* mentioned in 16 02 09 to 16 02 0.110 12 (fluorescent lamps and computer monitors) Discarded equipment other than that mentioned in 16 02 09 to 16 02 13 (computers, 2.680 16 02 14 None copy machines, fax machines 1.550 and other discarded electrical devices)

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Components removed from discarded equipment other 0.820 16 02 16 None than those mentioned in 16 02 0.000 15 (electronic waste) Laboratory chemicals consisting of or containing 0.012 hazardous substances, 16 05 06* None 0.038 including mixtures of laboratory chemicals 0.000 Ni-Cd batteries 16 06 02* None 0.000 Aqueous liquid wastes other Leachate than those mentioned in 16 10 generated at the 01 − leachate from the landfill site and 8,234.00 phosphogypsum landfill site in 16 10 02 undergoing 2,058.08 Wiślinka, undergoing recovery recovery (R5) at a

at a GA FOSFORY production fertilizer unit production unit Linings and refractories from None non-metallurgical processes 0.000 16 11 06 other than those mentioned in 0.000 16 11 05 Mixture of concrete, bricks, 14.800 None tiles and ceramics other than 17 01 07 0.000 those mentioned in 17 01 06 41.620 None Plastics 17 02 03 0.000 0.000 None Aluminium 17 04 02 0.000 Steel from discarded 595.016 None 17 04 05 equipment 305.240 Cables other than those 0.020 17 04 11 None mentioned in 17 04 10 0.000 Insulation materials other than 3.060 those mentioned in 17 06 01 17 06 04 None 0.700

and 17 06 03 Noexceedance of the permissible limits was found. Mixed construction and repair 4.440 17 09 04 None waste 27.050 Paper and cardboard 15 01 01 45.840 None packaging Oily water from oil/water 13 05 07* 2.640 None separators Packaging containing residues 15 01 10* 0.480 None of hazardous substances

Wooden packaging 15 01 03 49.120 None

Waste plastic 07 02 13 1.560 None

End-of-life tyres 16 01 03 1.270 None

Ferrous metal filings and 12 01 01 0.910 None turnings

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Spent grinding bodies and 12 01 21 0.250 None grinding materials Please provide details of the types and amounts of solid wastes generated by the project. Indicate where wastes are classified as hazardous. Indicate the final re-use, recycle or disposal method for each waste type.

5. Resource Usage and Product Output Measure Parameter Amount ment Comments6 Unit Fuels used: - fuel oil RG3 5,839 Mg 4,199 Mg

- light fuel oil 83,925 L 69,085 L

Crude oil Natural gas Not applicable Hard coal Lignite Grid electricity (from external 20,285,912 KWh provider) 21,148,362 kWh Heat purchased from external Not applicable sources Feedstocks and raw materials consumed: phosphate rock from Morocco 63,219 Mg 68−69 42,681 Mg

phosphate rock from Algeria 0 Mg 4,410 Mg phosphate rock from Senegal 10,007 Mg 743 Mg ammonium sulfate 3,301 Mg 2,812 Mg ammonium sulfate FGD 18,501 Mg 14,827 Mg zinc sulfate 73 Mg 75 Mg anhydrous sodium sulfate 0 Mg 0 Mg granulated potassium chloride 6,699 Mg 1,321 Mg fine potassium chloride 44,733 Mg 33,589 Mg phosphoric acid from external 13,075 Mg sources 100% P2O5 7,752 Mg sulfuric acid from external 4,368 Mg sources 0 Mg

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borax 236 Mg 187 Mg crystalline magnesite R 30 2,809 Mg 2,008 Mg crystalline magnesite R 40 0 Mg 0 Mg liquid sulfur 31,503 Mg 27,835 Mg soda lye 858 Mg 720 Mg ascorbic acid 2 Mg 2 Mg Product output:

SULFURIC ACID 92,167 Mg 81,479 Mg

SODIUM BISULFITE 1,692 Mg 1,488 Mg ENHANCED SUPERPHOSPHATE 51,665 Mg ‘SUPER-FOS-DAR 40’ 28,856 Mg ENHANCED SUPERPHOSPHATE 30 13,326 Mg 10,813 Mg AMOFOSKA 4-16-18 13,798 Mg 9,777 Mg AMOFOSKA 5-10-25+B 26,586 Mg 19,889 Mg AMOFOSKA 4-12-12+4 29,593 Mg 23,143 Mg AMOFOSKA Corn 4-10-22 7,478 Mg 7,315 Mg AMOFOSKA 4-10-28 + 2Mg 0 Mg 0 Mg AMOFOSKA 4-12-20 8,046 Mg 6,367 Mg Granulated potassium chloride 5,632 Mg 522 Mg 0 Mg AMOFOSKA 5-12-28 0 Mg AMOFOSKA 3.5-10-24 4,753 Mg 3,727 Mg AMOFOSKA 5-10-22 0 Mg 0 Mg AMOFOSKA 4-10-15 0 Mg 3,611 Mg HOLIST PK 15-30 18,187 Mg 14,123 Mg HOLIST PK 16-28 7,477 Mg 5,416 Mg HOLIST PK 12-36 0 Mg 0 Mg HOLIST NK 10-31 960 Mg 418 Mg HOLIST PK 20-20 0 Mg 339 Mg

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6. Human Resources management Please provide the name and contact details for Violetta Wuczyńska your Human Resources manager: Head of the HR and Organisational Department telephone: (+48) 58 34 38 250 mobile: (+48) 669 600 426 Email: [email protected] Recruited in this Terminated in this Total reporting period reporting period Number of direct employees: 307 60 40 281 23 53 Number of contracted 0 0 0 workers: 0 0 0 Were there any collective No [X] If Yes, please describe the redundancy plan, redundancies during the reporting including reasons for redundancies, number of period? workers involved, how they were selected, consultation undertaken, and measures to mitigate the effects of redundancy: Are any redundancies to the No [X] If Yes, please describe the redundancy plan, workforce planned for the next including reasons for redundancies, number of year? workers involved, and selection and consultation process: Were there any changes in trade No [X] If Yes, please provide details, and summarise union representation at Company engagement with trade unions during reporting plants during the reporting period: period? Were there any other worker Yes [X] If Yes, please provide details and summarise representatives (e.g. in the engagement with them during the reporting period: absence of a trade union)? In 2020, the Works Council elected its representative to the employee welfare committee. Were there any changes in the No [X] If Yes, please provide details: status of Collective Agreements? Have employees raised any No [X] If Yes, please state how many, split by gender, grievances with the project during summarise the issues raised in grievances by male the reporting period? and female staff and explain how the Company has addressed them: Have employees raised any No [X] If Yes, please state how many, split by gender, complaints about harassment or summarise the issues raised by male and female bullying during the reporting staff and explain how the Company has addressed period? them: Have there been any strikes or No [X] If Yes, please summarise nature of, and reasons for, other collective disputes related disputes and explain how they were resolved: to labour and working conditions at the Company in the reporting period? Have there been any court cases No [X] related to labour issues during the reporting period?

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Have there been any changes to Yes [X] If Yes, please give details, including of any new the following policies or terms initiatives: and conditions during the reporting period in any of the An equivalent working time system has been put in following areas: place with the possibility of extending daily working − Trade union recognition time to 12 hours. Such extended daily working time − Collective Agreements is offset by shorter working time on certain days or − Non-discrimination and equal by days off. opportunities for all − Equal pay for equal work − Gender equality − Bullying and harassment, including sexual harassment − Employment of young workers under 18 − Wages and salaries (for regular and overtime hours) − Overtime − Working hours − Flexible working / work-life balance − Grievance mechanism for workers − Health & safety

7. Occupational Health and Safety Data Please provide the name and Tomasz Gardzioła contact details for your Health OHS Officer and Safety manager: Telephone: (+48) 669-600-416 Email: [email protected] Direct Contracted Direct Contracted employees workers employees workers Number of man- Number of 508,249 hours worked in fatalities 7: 0 0 482,024 - this reporting 0 0 period: Budget spent on Number of OHS in this period approx. PLN disabling (total amount and 338.9 thousand injuries: 0 0 currency): approx. PLN - 0 0 400.0 thousand

OHS training Number of Lost provided in this 215 Time Incidents 9 0 - period in person- Ok.150 (including 6 1 days: vehicular):

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Number of lost Number of cases workdays 331 of occupational 0 0 - resulting from 343 disease: 0 0 incidents: Sick time (hours): 40,032 - 40,096 Accident causes (falling, heavy loads, struck by object, contact with energy source etc.): - hand crushing – 1 accident (1 person) - interrupted skin continuity – 2 accidents (2 persons) - careless movement – 3 accidents (3 persons) - chemical burn – 1 collective accident (2 persons) - hot fluid scalding classified as thermal burn – 1 person

- foot run over - slipping - body (part) crushing

In 2020, there were no fatal or major accidents. Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period: The GA FOSFORY OHS function is not responsible for emergency management.

In 2020, the GA FOSFORY OHS function was not involved in emergency management. Please summarise any emergency response exercises or drills that have been carried out during the reporting period: The GA FOSFORY OHS function is not responsible for emergency management. In 2019, one fire evacuation drill was carried out at the PP Department – Packing Facility 4.

In 2020, evacuation drills were cancelled due to COVID-19.

8. Stakeholder Engagement Please provide the name and contact details GA FOSFORY Sp. z o.o. does not employ an for your external relations or community external relations or community engagement engagement manager: manager. Tasks of the external relations or community engagement manager are performed by relevant units (OHS and Environmental Protection).

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Please provide information on the implementation of the Stakeholder Engagement Plan agreed with EBRD and summarise interaction with stakeholders during the reporting period, including: − meetings or other initiatives to engage with members of the public or public organisations during the reporting period − information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: − coverage in the media: − interaction with any environmental or other community groups. Please describe any changes to the Stakeholder Engagement Plan agreed with EBRD: GA FOSFORY Sp. z o.o. has no CSR policy in place but, given its production activities, follows CSR objectives in its operations. How many complaints or grievances did the project receive from members of the public or civil society organisations during the reporting period? Please split by stakeholder group. Summarise any issues raised in the complaints or grievances and explain how they were resolved: No complaints were received.

9. Community Development Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure: In 2020, GA FOSFORY continued to recover phosphates from sewage sludge incineration ash classified as waste designated with code 19 01 14 and included waste designated with code 19 01 12 in the recovery process. The initiative has reduced the volumes of waste transferred to the landfill site from the neighbouring sewage treatment plants and animal waste disposal plant.

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GA FOSFORY Sp. z o.o.

ENVIRONMENTAL AND SOCIAL ACTION PLAN

7. Actions required to maintain compliance with EHS requirements of national law and EU environmental standards − GA Fosfory No. Action Environmental risks, liabilities/benefits Legislative Requireme Scheduled Target and Comments requirements/ nt/Resourc completion – evaluation Best practice es action to be criteria for completed by implementation end of year progress 7.1 Complete environmental risk Reduce negative environmental impact Legislative Internal End of 2013 - Risk assessment assessment for groundwater in line with IED and the Bank's PRs. requirements, resources prepare the and action plan. from historical landfill site. best and action plan and The landfill site is situated in a management external preliminary Summary of both Based on risk assessment and vulnerable location, which could result practices, the support budget. in the annual surveys, develop a plan for in contamination of deeper water Bank's PRs, EU report. long-term monitoring and reservoirs used by the Town. Environmental Contingent actions to reduce the risk of Liability liabilities/provis contaminating groundwater A comprehensive risk assessment must Directive ions in annual and water reservoirs. be performed, and the investment (ELD) financial projects must reduce impacts. statements by Budget for the actions needs General site restoration is needed and 2013. to be developed. a landfill site management system must be put in place. Risk assessment by 2017.

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Note 1. The phosphogypsum landfill site in Wiślinka has been closed since December 31st 2009. It was closed pursuant to the Marshal of the Gdańsk s to Province's decision, and the process was carried out in accordance with closure plans providing for mechanised land restoration and in accordance 7.1 with a bioremediation plan. The closure was supervised by authorised technical experts and employees of the environmental protection department of the Marshal Office of the Gdańsk Province. The closed landfill site is supervised by environmental protection authorities and monitored on a continuous basis in accordance with applicable laws. 2. IED requirements do not apply to the phosphogypsum landfill site in Wiślinka, which was closed pursuant to the Marshal of the Gdańsk Province's decision. It has a closed site status, no new waste is received, and the site is subject to monitoring. 3. In April 2014, an environmental review of the closed phosphogypsum landfill site in Wiślinka was submitted to the Marshal Office and the Provincial Inspectorate for Environmental Protection (WIOŚ) of Gdańsk. According to the review, the impact of the landfill site on the environment is not significant. 4. Since August 2014, pursuant to Decision of August 1st 2014 Ref. No. DROŚ-SO.722.45.2013/2014.BA granting an integrated (IPPC) permit to the Company, leachate from the retention reservoir has been transferred to GA FOSFORY for recovery. Around 74,000 Mg of leachate had undergone recovery by the end of 2020, and thus approximately 859 Mg of phosphorus in P2O5 equivalent had been removed from the landfill site. Under the permit, 24,000 m3 of leachate may be transferred annually. The transfer and recovery of phosphate-containing leachate will accelerate the process of restoring the site to its original condition.

The Company has set up a provision for restoration and securing of the closed phosphogypsum landfill site in Wiślinka. As at December 31st 2020, the provision was PLN 3,087,318.00.

The maintenance, restoration and monitoring of the landfill site are financed solely with the Company's own funds.

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7.2 Set up a procedure to process Identification of problems and public Best practice Operational 2013 Management complaints and grievances to complaints in order to implement and costs of reports on enable meaningful public solutions designed to improve public compliance information application of the consultation and information perception of the Wiślinka landfill site with EBRD and office. grievance process with regard to PR10 procedure historical and current EHS requirements. Summary of impact of the Wiślinka landfill systems in the site in Gdańsk. annual report for the Bank Note The Company has a procedure in place for managing grievances and complaints in accordance with the ISO 9001 standard under the management s to system used by the Company. Grievances, complaints or other comments can be submitted using a contact form available from the Company's 7.2 website. Any important events are communicated by the Company on its website. Over the past few years, the Company has received no grievances or complaints with respect to its production facilities in Gdańsk or the closed phosphogypsum landfill site in Wiślinka. A series of articles on removal and recovery of phosphates-containing leachate and the role of the process in accelerating landfill restoration were also published to change public opinion on the Wiślinka landfill. One such article was ‘Innovative technology to enable Grupa Azoty to make fertilizers from waste’, posted athttps://chemia.wnp.pl/innowacyjna-technologia-pozwoli-grupie-azoty-produkowac-nawozy-z- odpadow,236125_1_0_0.html.

7.3 Prepare a plan (including Reduce negative environmental impact Legislative Internal 2016 /2017 Report on soil and budget) and conduct soil and in line with IED requirements, resources groundwater surface water assessment best and condition within the plot. management external practices, support Bank's PRs

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Note 1. The Company has set up a provision for restoration and securing of the closed phosphogypsum landfill site in Wiślinka. As at December 31st 2018, s to the provision was PLN 3,166,480.00. The maintenance, restoration and monitoring of the landfill site are financed solely with the Company's own 7.3 funds. 2. Surface water quality assessment The Company carries out surface water quality testing in accordance with the Monitoring Plan for the closed phosphogypsum landfill site in Wiślinka, as approved by the Marshal of the Gdańsk Province. Such tests are also carried out by the Provincial Inspector for Environmental Protection. 3. Soil and vegetation evaluation in the phosphogypsum landfill site's surrounding area Soil and vegetation quality testing was carried out within the protection zone of the phosphogypsum landfill site in Wiślinka and on agricultural land beyond that zone. The evaluation was carried out by independent specialist bodies: − Agricultural Academy of Wrocław and Wrocław University of Science and Technology, − National Agrochemical Station in Gdańsk. According to the evaluation, the landfill site poses no threats to the natural and agricultural environment of Wiślinka. 4. In 2014, the Company began removing leachate from the retention reservoir of the closed phosphogypsum landfill site in Wiślinka. As a result, the impact of the landfill site on the natural environment has been reduced, and the restoration process has been accelerated. 5. Soil condition assessment and groundwater surveys on GA FOSFORY’s land plots on which the principal activities covered by the Integrated Permit are carried out. In July 2017, the Environmental Research Laboratory of Przedsiębiorstwo Geologiczne Sp. z o.o. of Kielce, holding accreditation No. AB 1010 from the Polish Centre for Accreditation, carried out relevant tests of soil and groundwater samples. Based on the tests, a baseline report was drawn up, proposing that soil and ground contamination risk be assessed once every ten years, and that groundwater quality be tested once every five years. The Marshal Office approved the frequency of testing proposed in the baseline report through the provisions contained in Decision No. DROŚ-SO.7222.81.2017.EŻ of August 24th 2018.

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Annual Environmental & Social Report

1. Information about the Company Company Name: Grupa Azoty Jednostka Ratownictwa Chemicznego Sp. z o.o. Company Address: ul. Kwiatkowskiego 8, 33-101 Tarnów Country: Poland Town/Location: Tarnów Company authorised representative: I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period. Signature:

Title: President of the Management Board Date: April 15th 2021 Contact Details: Telephone: (+48) 14 637-27-30 Mobile: Email: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide:

Grupa Azoty Jednostka Ratownictwa Chemicznego Sp. z o.o.

Item Cumulative

[PLN ‘000] 2019 2020*

Revenue 52,906 61,795 Profit/(loss) on sales 4,322 9,627 EBIT 4,111 8,790 EBITDA 8,545 13,429 Net profit/(loss) 2,167 6,364 Data from the Company’s separate financial statements * Financial data not yet audited by the Qualified Auditor.

Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions; Number of staff employed and any change in employment over past 3 years

As at Dec 31 2018 As at Dec 31 2019 As at Dec 31 2020 Number of direct employees: 245 259 266 Number of contracted workers: 2 2 2

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive) Reporting period: 2020

- Decision by the Governor of the Opole Province dated December 13th 2006, No. ŚR.III.AS-6610-1- 30/06, as amended, granting an integrated (IPPC) permit to operate installations manufacturing, with the use of chemical processes, organic chemistry products and semi-finished products, i.e. WAXES, MELAMINE RESIN, and VARIOUS ORGANIC PRODUCTS,

- Decision by the Governor of the Kraków Province dated April 27th 2007, No. ŚR.XI.AJ.6663-11-06, as amended, granting an integrated (IPPC) permit for the ‘Czajki I and II’ landfill site,

- Decision by the Governor of the Kraków Province dated April 25th 2007, No. ŚR.XI.AJ.6663-6-06, as 1 2

amended, granting an integrated (IPPC) permit for the ‘Za Rzeką Biała’ landfill site,

- Decision by the Marshal of the Kraków Province dated August 5th 2013, No. SR-III- 1.7222.1.2013.AG , as amended, granting an integrated (IPPC) permit for the asbestos-containing waste landfill site in the AB-1-1 sector,

- Decision by the Governor of the Kraków Province dated May 24th 2007, No. ŚR.XI.AJ.6663-10-06, as amended, granting an integrated (IPPC) permit for the ‘AN II’ landfill site.

- Decision by the Marshal of the Kraków Province dated June 5th 2019, No. SR-III.7222.25.2018.AG, granting an integrated (IPPC) permit for installations – landfill cell sector for code 17 06 05 * hazardous waste – construction materials containing asbestos, over a part of land plot No. 25/54, cadastral district No. 203, located within the ‘Za Rzeką Biała’ landfill site.

Reporting period:2020

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Have there been any changes to Yes If Yes, please describe: environment, social, labour or health [X] and safety laws or regulations that No [ ] ENVIRONMENTAL PROTECTION have materially affected the Company? - Act of January 23rd 2020 Amending the Waste Act and Certain Other Acts (Dz.U. of 2020, item 150), - Regulation of the Minister of Internal Affairs and Administration of February 19th 2020 on fire protection requirements to be met by buildings, structures or parts thereof, and other locations used for collection, storage or treatment of waste (Dz. U. of 2020, item 296), - Act of March 31st 2020 Amending the Act on Special Measures to Prevent, Counteract and Combat COVID-19, Other Infectious Diseases and Crisis Situations Caused by Them, as well as Certain Other Acts (Dz. U. of 2020, item 568), - Act of May 14th 2020 Amending Certain Acts on Protective Measures in Connection with the Spread of SARS-CoV-2 (Dz. U. of 2020, item 875), - Public Notice of the Minister of Climate of September 9th 2020 on the rates of environmental fees for 2021 (M.P. of 2020, item 961)

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1) Inspection by the Kraków Provincial Inspectorate for Environmental Protection – Tarnów Branch, carried out on May 20th–June 10th 2020. The inspection was attended by a representative of the Marshal of the Kraków Province.

Type of installations (operations) inspected: - ‘Czajki I and II’ landfill site intended for wastes other than hazardous and inert waste.

Purpose of the inspection: − inspection of waste management, excluding municipal waste management, − inspection of compliance with the conditions regarding water abstraction volumes, as specified in relevant water-law permits and integrated (IPPC) permits, − inspection of compliance with the conditions regarding the quality and quantity of wastewater introduced into water or into the ground, as specified in relevant water-law permits and integrated (IPPC) permits, − inspection of compliance with environmental protection regulations with respect to emissions of gases and particulate matter into the air.

No violations or irregularities were identified.

2) Inspection by the Kraków Provincial Inspectorate for Environmental Protection – Tarnów Branch, carried out on May 20th–June 10th 2020. The inspection was attended by a representative of the Marshal of the Kraków Province.

Type of installations (operations) inspected: - Hazardous waste landfill site – AN-II pond.

No violations or irregularities were identified. 4 5

How many inspections did you Number: 0 Please provide details of these visits, including receive from the health and safety number and nature of any violations found: authorities during the reporting period? In the period under review, the County Sanitary Inspectorate did not carry out any inspections to assess the sanitary and technical condition of the facilities or health conditions in the work environment.

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How many inspections did you Number: 2 Please provide details of these visits, including receive from the labour authorities number and nature of any violations found: during the reporting period?

In the period under review, the National Labour Inspectorate carried out two inspections:

1. in connection with work related to removal of roofing materials from outbuildings (including removal of asbestos panels). No injunctive decisions were issued. Inspections: September 28th–October 2nd 2020

2. Inspection of potentially explosive zones. Carried out on October 13th–December 13th 2020 4 improvement notices and 4 administrative instructions were issued.

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Have these visits resulted in any Yes [ ] If Yes, please describe, including status of penalties, fines and/or corrective No [X] implementing corrective actions to address any action plans? violations found:

none

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Has the Company engaged any Yes [ ] If Yes, please state for which types of work, and contractors for project-related work No [X] how the Company has monitored the compliance in the reporting period? of contractors with EBRD Performance Requirements and the Environmental and Social Action Plan:

Were any violations found as a result Yes [ ] If Yes, please provide details, including how the of these actions that were the No [X] Company is ensuring that corrective actions are responsibility of external contractors implemented by the contractor? engaged by the Company? Have any operations been reduced, Yes [ ] If Yes, please describe: temporarily suspended or closed down No [X] due to environmental, health, safety or labour reasons? Please describe any environment or social programmes, initiatives or sub-projects undertaken during the reporting period to improve the Company's environmental or social performance and/or management systems: - Please indicate the level of associated expenditure (capital expenditure and operating expenditure), and whether this relates to the requirements of the Environmental and Social Action Plan, or to any other initiative: -

4. Environmental Monitoring Data for each of the key subsidiaries The information required in this section can be extracted from a CSR report, or a full CSR report can be attached.

Please provide the name and contact Dagmara Dalida details for your environmental Email: [email protected] manager: Tel.: (+48) 698 930 317; 14/637 27 30 extension 26 Parameter2 Amount3 Unit Compliance Status4 Comments5 Wastewater - Total wastewater -

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Biochemical - Oxygen Demand (BOD5) Chemical Oxygen - Demand (COD) Suspended solids - Phosphorus - Total nitrogen - Heavy metals - [Other] - Air Per each Mg/Nm3 - Notification concerning Paint shop – emissions major point gas cylinder certification chamber, source made by letter Ref. No. RZ/3528/ZS/267 of October 30th 2014.

- Notification concerning Chemical Wastewater Treatment Plant, SO2 storage and distribution, tanker unloading/cylinder and container loading installations, made by letter Ref. No. RZ/4096/ZS/160/2012, dated September 12th 2012.

- Decision by the Governor of the Opole Province dated December 13th 2006 (No. ŚR.III.AS-6610-1-30/06, as amended) − integrated (IPPC) permit for installations manufacturing, with the use of chemical processes, organic chemistry products or semi- finished products, i.e. WAXES, MELAMINE RESIN and VARIOUS ORGANIC PRODUCTS in Kędzierzyn- Koźle.

SO2 0.0832 Mg Nitrogen oxides 0.0055 Mg (NOX) Total PM 0.01277297 Mg

CO2 363.5593 Mg Carbon monoxide 0.5692367 Mg (CO) Other parameters Mg Non-methane 0.0483 Mg volatile organic compounds (NMVOCs) Ammonia 0.1038429 Mg Particulate matter 0.011422 Mg PM10 Particulate matter 0.009032 Mg PM2.5 Ethylene glycol 0.000573 Mg Formaldehyde 0.000175 Mg Methanol 0.000036 Mg Methane 179.214 Mg Furfuryl alcohol 0.000034 Mg [Other] - - Solid waste

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Types and amounts of waste generated in 2020 (aggregate data)

Waste Weight of waste generated [Mg] No. Waste type code Weight of Disposal method waste 1. 06 02 04* Sodium and potassium hydroxide 6.500 D9 Bottom ash, slag 2. 10 01 15 and boiler dust from co-incineration other 26190.82 R5 than those mentioned in 10 01 14 Transferred 3. 13 02 08* Other engine, gear and lubricating oils 0.450 to a third party 4. 15 01 01 Paper and cardboard packaging 0.09 Stored 5. 15 01 02 Plastic packaging 0.45 Stored Transferred 6. 15 01 02 Plastic packaging 14.74 to a third party 7. 15 01 04 Metallic packaging 1.32 Same as above Packaging containing residues of or 8. 15 01 10* 1.520 Same as above contaminated by hazardous substances absorbents, filter materials (including oil 9. 15 02 02* filters not otherwise specified), wiping 0.006 Same as above cloths 10. 16 01 03 End-of-life tyres 1.50 Same as above Discarded equipment containing hazardous 11. 16 02 13* components other than those mentioned 0.070 Same as above in 16 02 09 to 16 02 12 Discarded equipment other than that 12. 16 02 14 0.50 Same as above mentioned in 16 02 09 to 16 02 13 Laboratory chemicals (e.g. chemical reagents) consisting of or containing 13. 16 05 06* 0.072 D9 dangerous substance s 14. 16 07 99 Wastes not otherwise specified 3.46 D9 Transferred 15 17 04 05 Iron and steel 45.08 to a third party Insulation materials other than those 16. 17 06 04 10.97 Same as above mentioned in 17 06 01 and 17 06 03 17. 17 06 05* Construction materials containing asbestos 1,187.140 D5 Transferred Mixed construction and demolition wastes 18. 17 09 04 3.90 to a third other than those mentioned party Transferred Other wastes containing viable pathogenic 19. 18 02 02* 1.744 to a third microorganisms or their toxins party Stabilised sludge from treatment of 20. 19 08 05 20,048.62 R3 municipal wastewater Sludges from non-biological treatment of industrial wastewater other than those 21. 19 08 14 1,127.04 D5 mentioned in 19 08 13 10 11

Other wastes (including mixtures of materials) from mechanical treatment of 22. 19 12 12 15.32 D5 wastes other than those mentioned in 19 12 11

*hazardous waste

5. Resource Usage and Product Output

Measu Parameter Amount remen Comments6 t Unit Fuels used Crude oil - - Natural gas 9,701 m3 Hard coal 1 Mg Lignite - - Grid electricity 2,272,861 kWh Heat purchased from external 5,996 GJ sources Feedstocks and raw materials used Paraffin ltp 56/25 4 Mg Polyethylene 0.211 Mg

Urea 120.97 (+ Mg 0.794

crystallin e urea) Nafol 1.587 Mg Nansa 11.794 Mg Rosulfan (Sodium Lauryl Sulfate) 17.748 Mg Irgamet 0.0915 Mg Butyl glycol 11.324 Mg Phosphoric acid 0.02 Mg Triethanolamine 19.55 Mg Monoethylene glycol 4.148 Mg Lauric acid 11.05 Mg ABS paste 32.64 Hydrogen peroxide 13.033 Mg Disodium versenate 0.0596 Mg Ammonia water 61.498 Mg Soda lye 0 Mg Premelange 0 Mg Nitric acid 60% 0 Mg Premix arvo 0 Mg Sodium hydroxide 0.92 Mg Aluminium sulfate 4.6 Mg Yellow dextrin 12.75 Mg Kaolin 15.125 Mg H-40 hardener 7.8 Mg Formalin 2.1 Mg Formic acid 85% 0.00004 Mg Petrolatum 0.24 Mg N-100 base oil 0.1632 Mg T rofamin 0.048 Mg T 190 walloxen 0.0096 Mg 09 wax 0.0048 Mg P1801 stearic acid 0.0144 Mg 11 12

2-ethylhexanoic acid 3.48 Mg furfuryl alcohol 4.746 Mg p-Toluenosulfonic acid 50% 0.0044 Mg sodium hydroxide 50% 0.0047 Mg Topcoat paint 35 kg Primer 20 kg Solvent 15 kg Petroleum ether 10 kg Hardener 10 kg

Product output DE-EMIS 333.90 Mg PROTEKTOL SAT 146.00 Mg BASO 960E - Mg ARVONITRASEPT - Mg H-50 HARDENER 25.62 Mg H-55 HARDENER 25.24 Mg IXONOL-5 92.40 Mg PP-0 wax 4.17 Mg Casting resin 5.57 Mg Anti-caking agent 0.48 Mg ‘Preparat EH’ agent 3.00 Mg

6. Human Resources management

Please provide the name and contact details for Katarzyna Kokoszka, your Human Resources manager: HR Officer [email protected] Recruited in this Terminated in this Total reporting period reporting period Number of direct employees: 266 22 15

Number of contracted 2 0 0 workers: Were there any collective Yes [ ] If Yes, please describe the redundancy plan, redundancies during the reporting No [X] including reasons for redundancies, number of period? workers involved, how they were selected, consultation undertaken, and measures to mitigate the effects of redundancy: Are any redundancies to the Yes [ ] If Yes, please describe the redundancy plan, workforce planned for the next No [X] including reasons for redundancies, number of year? workers involved, and selection and consultation process: Were there any changes in trade Yes [ ] If Yes, please provide details, and summarise union representation at Company No [X] engagement with trade unions during the reporting plants during the reporting period: period? Were there any other worker Yes [ ] If Yes, please provide details and summarise representatives (e.g. in the No [X] engagement with them during the reporting period: absence of a trade union)? Were there any changes in the Yes [ ] If Yes, please provide details: status of Collective Agreements? No [X]

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Have employees raised any Yes [ ] If Yes, please state how many, split by gender, grievances with the project during No [X] summarise the issues raised in grievances by male the reporting period? and female staff and explain how the Company has addressed them: Have employees raised any Yes [ ] If Yes, please state how many, split by gender, complaints about harassment or No [X] summarise the issues raised by male and female bullying during the reporting staff and explain how the Company has addressed period? them: Have there been any strikes or Yes [ ] If Yes, please summarise nature of, and reasons for, other collective disputes related No [X] disputes and explain how they were resolved: to labour and working conditions at the Company in the reporting period? Have there been any court cases Yes [ ] If Yes, please summarise the issues contested related to labour issues during the No [X] and outcome: reporting period? Have there been any changes to Yes [X] If Yes, please give details, including of any new the following policies or terms No [ ] initiatives: and conditions during the reporting period in any of the following areas: - An agreement on pay rates for 2020, dated April − Trade union recognition 29th 2020 – the agreement provided for a PLN 300 on − Collective Agreements average gross increase in base pay per employee − Non-discrimination and equal starting from May 1st 2020. opportunities for all − Equal pay for equal work − Gender equality − Bullying and harassment, including sexual harassment − Employment of young workers under 18 − Wages and salaries (for regular and overtime hours) − Overtime − Working hours − Flexible working / work-life balance − Grievance mechanism for workers − Health & safety

7. Occupational Health and Safety Data Please provide the name and Edyta Bączek contact details for your Health email: [email protected] and Safety manager: Tel.: (+48) 887 706 555; /14/ 63 72 730 extension 43 Direct Contracted Direct Contracted employees workers employees workers Number of man- hours worked in 423,300 0 Fatalities7: 0 0 this reporting period:

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Budget spent on Number of OHS in this period 0 disabling 0 0 (total amount and PLN 601,000 injuries: currency): OHS training Number of Lost provided in this Time Incidents 151 0 1 0 period in person- (including days: vehicular): Number of lost Number of cases workdays 65 0 of occupational 0 0 resulting from disease: incidents: Number of sick 0 0 days: Accident causes (falling, heavy loads, struck by object, contact with energy source etc.): 1.Injury to a leg during movement Please provide details of any fatalities or major accidents that have not previously been reported to EBRD, including total compensation paid due to occupational injury or illness (amount and currency): None

Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period: such training was provided by staff managers as part of monthly scheduled job re-training sessions.

Please summarise any emergency response exercises or drills that have been carried out during the reporting period: January 21st 2020: evacuation drill in case of a leak during unloading of SO2 from a tank car. Evacuation of an injured person. Result of the drill – good, correct.

8. Stakeholder Engagement Please provide the name and contact details for your external relations or community engagement manager: Please provide information on the implementation of the Stakeholder Engagement Plan agreed with EBRD and summarise interaction with stakeholders during the reporting period, including: − meetings or other initiatives to engage with members of the public or public organisations during the reporting period − information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: − coverage in the media: − interaction with any environmental or other community groups. Please describe any changes to the Stakeholder Engagement Plan agreed with EBRD:

9. Community Development Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure:

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ENVIRONMENTAL AND SOCIAL ACTION PLAN

Table 0.1 Wisła Project, Grupa Azoty Poland – Environmental, Social, Health and Safety (ESHS) matters, Updated (Alchemist Project) Action Plan:

GRUPA AZOTY JRCH SP. Z O.O.

8. Actions required to maintain compliance with EHS requirements of national law and EU environmental standards − JRCh Jednostka Ratownictwa Chemicznego (Tarnów/Kędzierzyn) No. Action Environmental risks, liabilities/benefits Legislative Requireme Scheduled Target and Comments requirements/ nt/Resourc completion – evaluation Best practice es action to be criteria for completed by implementation end of year progress 8.1 Monitoring environmental Record consumption of raw materials, Legislative Internal Ongoing/ad-hoc Summary in the impacts of the operating fuels and energy, air emissions, water obligation, resources and periodic annual report for production unit (Chemzak in consumption, and amounts of best reports the Bank Kędzierzyn) generated waste practice/inter Reference to BAT Regularly evaluate operational nal resources requirements. efficiency to minimize resource consumption and waste generation

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Information: Consumption of raw materials, fuels and energy, air emissions, water consumption, and amount of generated waste are recorded. The process units are regularly evaluated for efficiency to minimise raw material consumption and waste generation. The environmental impact of the process units is monitored in accordance with the integrated (IPPC) permit.

Requirements: - Decision by the Governor of the Opole Province dated December 13th 2006 (No. ŚR.III.AS-6610-1-30/06, as amended) − integrated (IPPC) permit for installations manufacturing, with the use of chemical processes, organic chemistry products or semi-finished products, i.e. WAXES, MELAMINE RESIN and VARIOUS ORGANIC PRODUCTS, located in Kędzierzyn-Koźle at ul. Mostowa 30H. Decision valid for an indefinite term. - Decision by the Marshal of the Opole Province dated December 20th 2012 (No. DOŚ.7222.64.2012.HM) on change of the manager of the Company operating the above units from Chemzak Sp. z o.o. to GA JRCh Sp. z o.o., - Decision by the Marshal of the Opole Province dated May 10th 2016 (No. DOŚ-III.7322.21.2016.Aka) granting a water-law permit for introduction of industrial wastewater from the installations manufacturing, with the use of chemical processes, organic chemistry products or semi-finished products, i.e. WAXES, MELAMINE RESIN and VARIOUS ORGANIC PRODUCTS, into sewerage systems of Grupa Azoty S.A. Kędzierzyn – Koźle. Valid until May 9th 2020. - by a letter of March 23rd 2020, the Company applied to the Head of the Gliwice Catchment Area Management Authority of the ‘Polish Waters’ National Water Management Authority (PGW-WP) for a new water-law permit. The proceedings concluded with the grant of a water-law permit for special use of water – introduction of industrial wastewater from the installations manufacturing, with the use of chemical processes, organic chemistry products or semi-finished products, i.e. WAXES, MELAMINE RESIN and VARIOUS ORGANIC PRODUCTS, into sewerage systems of Grupa Azoty S.A. Kędzierzyn-Koźle – Decision No. GL.RUZ.4210.156m.2020.EGK/TS of February 19th 2021, valid until February 19th 2025.

8.2 Monitor environmental impact Reduce negative environmental impact Legislative Internal Ongoing Summary in the of non-hazardous waste requirements, resources annual report for landfill sites and prepare a best and the Bank programme of their closure management investment and restoration (‘Czajki I II’, practices, s ‘Za Rzeką Biała’) Bank's PRs

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Information: Reduce negative environmental impact: - on air quality: • maintaining transport roads clean, • proper organisation of extraction work, • sprinkling transport roads with water during periods of high temperatures to suppress dust. - on noise pollution: • limiting transport vehicle traffic and machine operation at the landfill site to a necessary minimum, • using only equipment in good working order, • carrying out extraction activities during daytime only.

- on groundwater: • maintaining sludge supernatant pumping house in continuous working order, • maintaining drains, culverts, perimeter trenches, and drainage systems in good condition. The environmental impact monitoring of the ‘Czajki I and II’ and ‘Za Rzeką Biała’ landfill sites is carried out in accordance with the integrated (IPPC) permits. Remediation of: - separated section of the Czajki I western cell within the ‘Czajki I and II’ landfill site, - AB-2 sector of the ‘Za Rzeką Biała’ landfill site. Requirements: - Decision by the Governor of the Kraków Province dated April 27th 2007, No. ŚR.XI.AJ.6663-11-06, as amended, granting an integrated (IPPC) permit for the ‘Czajki I and II’ landfill site. Decision valid for an indefinite term. - Decision by the Marshal of the Kraków Province dated December 23rd 2016, No. SR-III-1.7241.42.2016.AG, as amended, approving the operation manual for the ‘Czajki I and II’ landfill site. - Decision by the Governor of the Kraków Province dated April 25th 2007, No. ŚR.XI.AJ.6663-6-06, as amended, granting an integrated (IPPC) permit for the ‘Za Rzeką Biała’ landfill site. Decision valid for an indefinite term. - Decision by the Marshal of the Kraków Province dated August 20th 2018, No. SR-III.7241.29.2018.AG, approving the operation manual for the ‘Za Rzeką Biała’ landfill site. - Decision by the Marshal of the Kraków Province dated June 5th 2019, No. SR-III.7222.25.2018.AG, granting an integrated (IPPC) permit for installations – landfill cell sector for code 17 06 05 * hazardous waste – construction materials containing asbestos, over a part of land plot No. 25/54, cadastral district No. 203, located within the ‘Za Rzeką Biała’ landfill site. Decision valid until June 30th 2021. - Decision by the Marshal of the Kraków Province dated June 18th 2019, No. SR-III-1.7241.3.2019.AG, approving the operation manual for landfill site sector for code 17 06 05* hazardous waste – construction materials containing asbestos, over a part of land plot No. 25/54, cadastral district No. 203, located within the ‘Za Rzeką Biała’ landfill site. - Decision by the Marshal of the Kraków Province dated December 18th 2013, No. SR-IV.1.7322.1.32.2013.MG, granting a water-law permit for discharge of rainwater and meltwater into Rów Chyszowski. Permit effective until December 31st 2023. - Decision by the Director of the Regional Water Management Authority in Kraków dated August 2nd 2018, No. KR.RUZ.4211.31.2018.AS, as amended, granting a water-law permit for special use of water – discharge of wastewater from the ‘Za Rzeką Biała’ landfill site (Outlet II) to the Biała river, - Decision by the Director of the Regional Water Management Authority in Kraków dated July 15th 2019, No. KR.RUZ.421.1.95.2019.AS, granting a water-law permit to discharge groundwater drained from the Klikowa district through a ditch outlet (Outlet II) to the Biała river. Permit valid for a period of 10 years from the date on which the decision became final.

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8.3 Monitor environmental Reduce negative environmental impact Legislative Internal Final closure Summary in the impact of the old hazardous requirements, resources and annual report for waste landfill site and Design document/(technical and best and implementat the Bank prepare a programme for its financial) concept for planned management investment ion of the restoration (‘AN II’ landfill) restoration with a future monitoring practices, s restoration programme Bank's PRs programme: Information: The environmental impact monitoring of the ‘AN II’ landfill site is carried out in accordance with the integrated (IPPC) permit. Requirement: - Decision by the Governor of the Kraków Province dated May 24th 2007, No. ŚR.XI.AJ.6663-10-06, as amended, granting an integrated (IPPC) permit for the ‘AN II’ hazardous waste landfill site. Decision valid for an indefinite term. - Decision by the Marshal of the Kraków Province dated February 10th 2015, No. SR-III-1.7241.21.2014.AG, as amended, approving the operation manual for the ‘AN II’ landfill site.

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Annual Environmental & Social Report

1. Information about the Company Company Name: Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. Company Address: 47-220 Kędzierzyn-Koźle; ul. Mostowa 30 A; P.O. Box 163 Country: Poland Town/Location: Kędzierzyn-Koźle Company authorised representative: Sławomir Lipkowski

I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period. Signature:

Title: President of the Management Board – Chief Executive Officer Date: April 15th 2021 Contact Details: Telephone: (+48) 77 481 26 59 Mobile: (+48) 785 787 777 Email: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide:

Item Cumulative

[PLN ‘000] 2019 2020

Revenue 1,834,609 1,738,272 Profit/(loss) on sales 377,414 335,953 EBIT 161,389 141,520 EBITDA 290,376 263,898 Net profit/(loss) 126,083 117,828

Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions;

See Section 4 and Section 5.

Number of staff employed and any change in employment over past 3 years

As at Dec 31 2018 As at Dec 31 2019 As at Dec 31 2020 Number of direct employees: 1,570 1,574 1,528 Number of contracted workers: - - - Other information in Section 6.

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive)

Grupa Azoty ZAK S.A. operates in full compliance with applicable legal requirements. In 2020, Grupa Azoty ZAK S.A. continued to work on achieving a clear legal status with respect to 2

environmental protection standards to ensure that its operations are conducted in compliance with the law. A number of decisions were obtained, including: • Amendment to the permit for greenhouse gas emissions from CHP plant units; • Amendment to the integrated permit for the synthesis gas, aldehydes and alcohols, di-2- ethylhexyl terephthalate (with a batch production unit) and special esters production units, together with the issuance by the Marshal of the Opole Province of the consolidated text of the integrated permit dated April 6th 2020; • Amendment to the integrated permit for the ammonia (including a synthesis gas compressor station), TK IV and TK V nitric acid, calcium ammonium nitrate, urea, and liquid fertilizers production units; • Amendment to the integrated permit for the installations of the Power Business Unit (adaptation to BAT LCP conclusions). • Four decisions granting permission to remove a total of 30 trees from the Company’s premises (mainly dead birches and trees growing at the main gate in connection with a project to be executed there). In addition: • an application was submitted to amend the integrated (IPPC) permit for the wastewater treatment plant to reflect participation of the Company’s installations in the emissions trading scheme: • − an application for amendment to the greenhouse gas emission permit for ZAK Spółka Akcyjna’s chemical installations was pending, − two applications for free allocation of greenhouse gas emission allowances for 2021–2025 are pending for installations covered by the emissions trading scheme, i.e. the CHP plant’s installations and ZAK Spółka Akcyjna’s chemical installations.

Below are presented environmental decisions currently held by Grupa Azoty ZAK S.A. (as at December 31st 2020):

Integrated permits: I. Oxoplast Business Unit's installations Decision Ref. No. DOŚ-III.7222.35.2019.AK of April 6th 2020 – integrated (IPPC) permit for the installations of the Oxoplast Business Unit – consolidated text, as amended: Decision Ref. No. DOŚ-III.7222.31.2020.AK of May 26th 2020.

II. Fertilizer Business Unit's installations Environmental decision ŚR.III-MJ-6610-1-28/06 of December 29th 2006 − integrated permit for the Fertilizers Business Unit's installations, as amended by: Environmental order ŚR.III-MW-6610-1/16/07 of May 14th 2007 Environmental order DOŚ.III-MJP-7636-21/08 of June 10th 2008 Environmental decision DOŚ.III.MWo-7636-47/08 of March 26th 2009 Environmental order DOŚ.III-MJP-7636-24/09 of June 17th 2009 Environmental decision DOŚ.III-MJ-7636-50/09 of December 22nd 2009 Environmental decision DOŚ.III-MJ-7636-51/09 of October 13th 2010 Environmental decision DOŚ.MWi.7636-45/10 of December 23rd 2010 Environmental decision DOŚ.7222.48.2011.MJ of October 15th 2012 Environmental decision DOŚ.7222.36.2014.MJ of October 27th 2014 Environmental decision DOŚ.7222.106.2014.HM of March 30th 2015 Environmental decision DOŚ.7222.61.2015.MSu of May 4th 2016 Environmental decision DOŚ.7222.55.2017.HM of January 31st 2018 Environmental decision DOŚ-III.7222.6.2020.HM of November 12th 2020.

III. Power Business Unit's and Infrastructure Unit's installations 1. Environmental decision ŚR.III-MJ-6610-1-29/05 of June 30th 2006 − integrated permit for the Power Business Unit's and Infrastructure Unit's installations, as amended by: Environmental decision DOŚ.III.MWo.7636-46/08 of December 31st 2008 3

Environmental decision DOŚ.Aku.7636-39/10 of June 11th 2010 Environmental decision DOŚ.7222.36.2013.MJ of January 31st 2014 Environmental decision DOŚ.7222.39.2014.JZ of November 27th 2014 Environmental decision DOŚ.7222.84.2014.BG of March 17th 2015 Environmental decision DOŚ.7222.65.2015.MJ of December 29th 2015 Environmental decision DOŚ-III.7222.21.2016.BG of February 28th 2017 Environmental order DOŚ-III.7222.21.2016.BG of March 8th 2017 Environmental decision DOŚ-III.7222.69.2017.JW of December 15th 2017 Environmental decision DOŚ-III.7222.21.2019.MWr of October 15th 2020

2. Environmental decision DOŚ.7222.12.2015.AK of June 30th 2015− integrated permit for the wastewater treatment facility, as amended by: Environmental decision DOŚ.7222.42.2016.NG of October 24th 2016 Environmental decision DOŚ-III.7222.79.2017.AK of March 30th 2018 Environmental decision DOŚ-III.7222.43.2019.AKa of January 16th 2020.

IV. Water-law permit 1. Environmental decision ŚR.III-MJP-6811-179/05 of March 14th 2006 − water-law permit for water withdrawal, as amended by: Environmental decision ŚR.II-MJP-6811-13/07 of May 21st 2007 Environmental decision GL.RUZ.421.148.2018.TS of September 25th 2018 2. Environmental decision ŚR.III-MK-6811/19/02 of May 16th 2002 – decision establishing a direct protection zone for wells drawing water from Tertiary and Quaternary formations.

V. Ash and slag landfill 1. Environmental decision DOŚ.III.7241.2.9.2013.MK of February 26th 2014 – decision approving the ash and slag landfill operation manual.

VI. Greenhouse gas emissions 1. Environmental permit DOŚ-III.7225.25.2016.BG of January 23rd 2017 − permit for greenhouse gas emissions from the TKIV and TKV nitric acid production installations and from the ammonia, synthesis gas, aldehyde and alcohol production installations, as amended by: DOŚ-III.7225.1.2018.NG of March 21st 2018, DOŚ-III.7225.7.2019.MWr of July 22nd 2019. Environmental order DOŚ-III.7225.7.2019.MWr of August 12th 2019

2. Environmental decision DOŚ-III.7225.20.2016.BG of November 25th 2016 – permit for greenhouse gas emissions from the fuel combustion installations with a rated thermal power of 395 MWt, as amended by: Environmental decision DOŚ-III.7225.16.2017.BG of November 24th 2017 Environmental decision DOŚ-III.7225.42.MWr of October 12th 2020

3. Environmental decision DOŚ-III.7225.25.2019.BG of January 28th 2020 approving the monitoring methodology plan (CHP plant), as amended by: DOŚ-III.7225.32.2020.BG of July 24th 2020

4. Environmental decision DOŚ-III.7225.26.2019.BG of February 5th 2020 approving the monitoring methodology plan (ZAK Spółka Akcyjna), as amended by: DOŚ-III.7225.31.2020.BG of August 25th 2020.

VII. Remediation 4

1. Environmental decision WOOŚ.511.1.2.2016.ER.10 of May 8th 2017 concerning a remediation plan for historical land surface contamination at the site of the Central Mechanical and Biological Wastewater Treatment Facility (area between the sewage sludge landfill and pond 3), 2. Environmental decision WOOŚ.511.1.6.2016.ER.7 of May 26th 2017 concerning a remediation plan for historical land surface contamination at the site of the former Copper-Based Syngas Cleaning Unit II (Field E-5), as amended by decision WOOŚ.515.13.ER.4 of August 8th 2018, 3. Environmental decision WOŚ.511.1.7.2016.ER.6 of August 1st 2017 concerning a remediation plan for historical land surface contamination at the site of the former semi-hard wax and chromopol unit, as amended by decision WOOŚ.515.21.2018.ER.3 of December 6th 2018, 4. Environmental decision WOOŚ.511.1.2018.MO.6 of July 27th 2018, agreeing the conditions of remedial activities for the unit 861 area.

Reporting period: 2020

2. General Is the project materially compliant Yes [X] If No, please provide details of any material with all relevant EBRD Performance No [ ] non-compliances: Requirements (taking account of agreed action plans, exemptions or derogations)? Is the project materially compliant Yes [X] If No, please provide details of any material with all applicable environmental and No [ ] non-compliances: social laws and regulations? Have there been any accidents or Yes [ ] If Yes, please describe, including details of incidents that have caused damage to No [X] actions to remedy and prevent reoccurrence: the environment, brought about - injuries or fatalities, affected project labour or local communities, affected cultural property, or created liabilities for the company? Have there been any changes to Yes [X] If Yes, please describe: environment, social, labour or health No [ ] In the area of ENVIRONMENTAL PROTECION: and safety laws or regulations that have materially affected the • Regulation of the Minister of Internal Affairs and Administration of February 19th Company? 2020 on fire protection requirements to be met by buildings, structures or parts thereof, and other locations used for collection, storage or treatment of waste (Dz.U. of February 25th 2020, item 296) • Act of May 14th 2020 Amending Certain Acts on Protective Measures in Connection with the Spread of SARS-CoV-2 (Dz. U. of May 15th 2020, item 875) amending, inter alia, the Water Law – by extending the deadline for carrying out a risk analysis for water intake points and submitting an application for the establishment of protection zones covering direct protection areas and, if justified, indirect protection areas • COMMISSION IMPLEMENTING REGULATION (EU) 2020/2085 of 14 December 2020 amending and correcting Implementing Regulation (EU) 2018/2066 on the monitoring and reporting of greenhouse gas emissions pursuant to Directive 2003/87/EC of the European Parliament and of the 5

Council (OJ. EU L 423/37 of 15 December 2020, No. L 423/37) • Regulation of the Minister of Climate of September 11th 2020 on specific requirements for waste storage (Dz.U. of October 8th 2020, item 1742).

There were no such changes in the other areas.

How many inspections did you receive Number: 2 Please provide details of these visits, including from the environmental authorities number and nature of any violations found: during the reporting period? In 2020, two inspections related to environmental protection were carried out by the Opole Provincial Inspectorate for Environmental Protection (WIOŚ). The WIOŚ inspections concerned: a) the inspection carried out on July 28th– August 6th 2020 – was a comprehensive inspection of the Power Business Unit’s fuel combustion facilities covering all environmental aspects and the Infrastructure Business Unit’s waste storage facilities; b) the inspection carried out on November 25th–December 31st 2020 – was a comprehensive inspection of the Fertilizers Business Unit’s and Power Business Unit’s facilities covering all environmental aspects. No violations were identified as a result of the former inspection. The latter inspection did identify certain breaches of the terms of integrated (IPPC) permits in 2019 for the Fertilizers Business Unit (higher production of urea and liquid fertilizers, with related consumption of raw materials and amount of generated waste) and for the Power Business Unit (higher consumption of electricity and fuel oil, higher amount of generated waste). How many inspections did you Number: Please provide details of these visits, including receive from the health and safety 1 number and nature of any violations found: authorities during the reporting On January 27th 2020, the County Sanitary and period? Epidemiological Station carried out an inspection. The scope of the inspection covered biological agents in the workplace, as well as carcinogens and mutagens in the workplace. No issues or reservations were raised regarding the subject matter of the inspection. How many inspections did you Number: Please provide details of these visits, including receive from the labour authorities 0 number and nature of any violations found: during the reporting period? In 2020, no inspections were carried out at Grupa Azoty ZAK S.A. by the National Labour Inspectorate. 6

Have these visits resulted in any Yes [X] If Yes, please describe, including status of penalties, fines and/or corrective No [ ] implementing corrective actions to address any action plans? violations found: In the environmental area, during the comprehensive inspection of the Fertilizers Business Unit’s and Power Business Unit’s facilities carried out on November 25th– December 31st 2020 by the Provincial Inspectorate for Environmental Protection (WIOŚ), breaches of certain provisions of integrated (IPPC) permits by both Business Units in 2019 were identified, as a result of which sanctions were imposed in the course of the inspection (one caution and one fine) on the facility operators. As a result of the inspection, in February 2021 WIOŚ also issued a requirement notice to ensure compliance with the provisions stipulated in the integrated (IPPC) permits for the facilities for which breaches had been identified during the inspection. In response to the notice, Grupa Azoty ZAK S.A. provided information on actions aimed to eliminate the breaches identified in the notice, including update of the provisions of the integrated (IPPC) permits. Has the Company engaged any Yes [X] If Yes, please state for which types of work, contractors for project-related work No [ ] and how the Company has monitored the in the reporting period? compliance of contractors with EBRD Performance Requirements and the Environmental and Social Action Plan:

The Company engaged external contractors for the following types of work: - development of project documentation, - demolition work (decommissioning of idle pipelines), - construction and repair work, - collection of waste generated by the plant (including complete oil and lubrication service of plant and equipment). The work of subcontractors was monitored through: - ongoing supervision of work, - ongoing OHS inspections, - waste transfer notes, - work acceptance reports. Were any violations found as a result Yes [ ] If Yes, please provide details, including how of these actions that were the No [X] the Company is ensuring that corrective actions responsibility of external contractors are implemented by the contractor? engaged by the Company? Have any operations been reduced, Yes [ ] If Yes, please describe: temporarily suspended or closed down No [X] - due to environmental, health, safety or labour reasons? Please describe any environment or social programmes, initiatives or sub-projects undertaken during the reporting period to improve the Company's environmental or social performance and/or management systems: On January 28th–31st 2020, Grupa Azoty ZAK S.A. successfully passed a recertification audit of its integrated management system for compliance with the requirements of the following standards: ISO 9001:2015 in the quality area, ISO 14001:2015 in the environmental area and new ISO 45001:2018 in 7

the OHS area. Following favourable audit results and a recommendation issued by the audit team, BVQI (a certification body) issued to the Company IMS Certificate No. PL011120/U (valid until February 13th 2023) confirming compliance of the integrated management system it had implemented and maintained with the requirements of the standards referred to above.

In 2020, the Company engaged in activities designed to achieve specific objectives of the environmental protection management system, as well as tasks undertaken under the ‘Responsible Care®’ Programme, the most important of which were: 1) Upgrade of E-102 boiler and E-117 superheater at the ammonia unit to bring these facilities in line with new technological conditions and to improve their efficiency. 2) Replacement of K-2 and K-3 steam compressors compressing ammonia gas with three new electric units along with auxiliary equipment (separators, heat exchanger), which eliminated the need to use steam in the ammonia compressing and liquefaction process. 3) Installation and start-up of a sampler enabling continuous sampling of wastewater discharged into the Oder river and meeting the requirements of the integrated (IPPC) permit. 4) Start of land remediation activities at facility 861 (former maleic anhydride unit). 5) Reduced discharges into the industrial sewerage system of wastewater containing urea and ammonia generated during washing of apparatus and equipment in the crystallisation building at the urea unit to prepare them for an overhaul – the technical condition of the flooring and the technical condition of the sewer carrying off wastewater from the building to the so-called ‘waste basin’ were improved. 6) Development of project documentation for a bypass interceptor of the Piskorzowiec wastewater treatment plant, which will ultimately eliminate the effects of algal bloom in the last wastewater treatment unit during summer periods. 7) Reduction of the amount of waste stored in the on-site landfill by transferring it to licensed third party collection companies. 8) Improvement of staff safety at a number of units through proper OHS and fire prevention measures. 9) Implementation of nine health promotion projects for employees and their children. Please indicate the level of associated expenditure (capital expenditure and operating expenditure), and whether this relates to the requirements of the Environmental and Social Action Plan, or to any other initiative:

Expenditure on the implementation of the planned activities was as follows: − expenditure on specific environmental protection objectives in 2020 – approximately PLN 98.16m, − expenditure on activities undertaken as part of the ‘Responsible Care®’ Programme in 2020 – approximately PLN 4.11m.

The table is attached hereto.

4. Environmental Monitoring Data for each of the key subsidiaries The information required in this section can be extracted from a CSR report, or a full CSR report can be attached.

Please provide the name and contact details Joanna Maj – Head of Environmental Protection for your environmental manager: Telephone: (+48) 77 481-21-03 Mobile: (+48) 695-380-998 Email: [email protected] Parameter2 Amount3 Unit Compliance Status4 Comments5 Wastewater Total wastewater 6,412.3 ‘000 m3 Compliant Aggregate wastewater stream 8

Biochemical 65.5 Mg Compliant Same as above Oxygen Demand (BOD5) Chemical Oxygen 420.0 Mg Compliant Same as above Demand (COD) Suspended solids 142.4 Mg Compliant Same as above Phosphorus 2.1 Mg Compliant Same as above Nitrate nitrogen 74.5 Mg Compliant Same as above Heavy metals 2.535 Mg Compliant Same as above [Other] Ammoniacal 21.5 Mg Compliant Same as above nitrogen Total nitrogen 111.6 Mg Compliant Same as above Air emissions

SO2 793.5 Mg Emissions (mainly from the CHP plant) Nitrogen oxides 693.3 Mg Aggregate emissions from (NOX) the CHP plant and chemical units Particulates 181.2 Mg Same as above

CO2 874,159.6 Mg Same as above Other parameters Noise emissions In 2020, periodic noise pollution measurements were carried out at the Company’s units as part of the projects in progress. No exceedance of the permissible night- or daytime noise levels was found at the border of the areas subject to regulation. [Other] - - - - Total solid waste 90,879.47 Mg Compliant Volume of waste generated including: in the reporting period 06 13 02* 3.66 Mg Compliant Urea, aldehyde and alcohol activated carbon post-production waste 07 01 08* - still 1,654.92 Mg Compliant Aldehyde and alcohol post- bottoms and production waste reaction residues 07 01 10* 388.33 Mg Compliant Ester post-production waste filter cakes 10 01 01 5,014.32 Mg Compliant Waste from the Company's slag, bottom ash CHP plant 10 01 02 33,542.00 Mg Compliant Waste from the Company's fly ash CHP plant 10 01 80 ash and 38,376.94 Mg Compliant Waste from the Company's slag mixtures CHP plant 10 01 82 4,929.80 Mg Compliant Waste from the Company's mixtures of ash CHP plant and desulfurisation waste 15 01 01 paper 3.75 Mg Compliant Aggregate waste stream packaging 15 01 02 plastic 14.40 Mg Compliant Aggregate waste stream packaging 15 01 03 wooden 45.54 Mg Compliant Aggregate waste stream packaging 15 01 04 metal 1.91 Mg Compliant Aggregate waste stream packaging 15 01 07 glass 0.11 Mg Compliant Aggregate waste stream packaging 9

15 01 10* Packaging 2.97 Mg Compliant Aggregate waste stream containing residues of or contaminated by hazardous substances

15 02 02* 6.57 Mg Compliant Aggregate waste stream absorbents, wiping cloths contaminated by hazardous substances 15 02 03 5.88 Mg Compliant Aggregate waste stream absorbents, filter materials 16 02 14 1.10 Mg Compliant Aggregate waste stream discarded equipment 16 07 09* 7.88 Mg Compliant Waste from the fertilizers waste from tank production line cleaning 16 08 01 spent 5.66 Mg Compliant Nitric acid post-production catalysts waste containing precious metals 16 08 02* 23.25 Mg Compliant Aldehyde and alcohol as spent catalysts well as ammonia post- production waste 17 02 01 6.44 Mg Compliant Aggregate waste stream wood 17 02 03 14.36 Mg Compliant Aggregate waste stream plastics 17 04 02 42.39 Mg Compliant Aggregate waste stream aluminium 17 04 05 3,604.12 Mg Compliant Aggregate waste stream iron and steel 17 04 07 0.86 Mg Compliant Aggregate waste stream mixed metals 19 08 01 448.76 Mg Compliant Waste from treatment of screenings aggregate wastewater stream 19 08 02 waste 0.52 Mg Compliant Waste from treatment of from desanding aggregate wastewater stream 19 08 10* – oils 16.14 Mg Compliant Waste from treatment of from wastewater aggregate wastewater treatment plants stream 19 08 11* - sludges 1,890.16 Mg Compliant Waste from treatment of from biological aggregate wastewater treatment of stream industrial wastewater 19 08 13* - sludges 545.98 Mg Compliant Waste from treatment of from non-biological aggregate wastewater treatment of stream industrial wastewater 10

19 09 01 – solid 31.92 Mg Compliant Waste from water waste from treatment primary filtration and screenings 19 09 05 31.38 Mg spent ion exchange resins Please provide details of the types and amounts of solid wastes generated by the project. Indicate where wastes are classified as hazardous. Indicate the final re-use, recycle or disposal method for each waste type.

In 2020, there were no projects at Grupa Azoty ZAK S.A. in which demolition work contractors would generate (under relevant contracts) demolition debris or asbestos containing materials, and therefore no such waste was generated and there was no need to take any measures to further manage such waste.

5. Resource Usage and Product Output Measureme Parameter Amount Comments6 nt Unit Fuels used Crude oil - - - Natural gas 4,227,734 MWh For ammonia production Hard coal Mg Coal parameters: calorific value – 20,743 212,027 kJ/kg, sulfur content – 0.44%, ash content – 27.04%. Lignite - Grid electricity MWh Total volume of electricity purchased for Grupa Azoty ZAK S.A. – both for in-house 611,965 needs as an end user and for resale as part of the electricity trading business. Heat purchased from 53,485 GJ - external sources Used feedstocks and raw materials Propylene 122,868 Mg For alcohol and aldehyde production Ammonia 7,973 Mg For nitric acid production Terephthalic acid 19,812 Mg For Oxoviflex plasticizer production Oxygen 242,160 ‘000 m3 Figure covers all plant operations Nitrogen 267,007 ‘000 m3 Figure covers all plant operations Dolomite 86,142 Mg Dolomite powder production unit Product output Anhydrous ammonia 401,090 Mg Gaseous carbon dioxide 252,740 Mg Technical-grade nitric acid 518,484 Mg Ammonium nitrate 578,936 Mg solution Miksal 4,165 Mg ZAKsan® 326,494 Mg Total Salmags, including: 274,072 Mg Salmag® 262,530 Mg Salmag z magnezem® 0 (Salmag with magnesium) Salmag z borem® (Salmag 2,567 Mg with boron) Salmag z siarką® (Salmag 8,976 Mg with sulfur) 28% UAN 23,731 Mg 30% UAN 30,993 Mg 32% UAN 88,105 Mg UAN S 268 Mg Total urea, including: 199,215 Mg - Urea-based lyes 199,215 Mg 46% granulated urea 98,279 Mg ® 33% PULNOx 23 Mg ® 40% PULNOx 31,319 Mg ® 45% PULNOx 3,621 Mg NOXy® (AdBlue®) 123,930 Mg LIKAM® 10,499 Mg WGS1 synthesis gas 925,268 ‘000 m3 WGS2 synthesis gas 127,154 ‘000 m3 Isobutyl aldehyde 3,877 Mg n-butyl aldehyde 4,645 Mg Total OXO alcohols, 174,227 Mg including: 12

2-Ethylhexanol 135,192 Mg Isobutanol 10,016 Mg n-butanol 29,019 Mg Octanol F 5,292 Mg OxoviflexTM 45.721 Mg Mix of plasticizers 16 Mg Adoflex® 253 Mg Oxovilen® 465 Mg Instrument air 76,336 ‘000 m3 Heat 4,459,200 GJ Electricity 119,637 MWh

6. Human Resources management Please provide the name and contact details for Monika Ptaszyńska, Head of HR Policy Office your Human Resources manager: Telephone: (+48) 77 481-31-52 Mobile: (+48) 723-186-834 Email: [email protected] Hired in this Terminated in this Total reporting period reporting period Number of direct employees: 1,528 82 101 Number of contracted workers: - - - Were there any collective Yes [ ] If Yes, please describe the redundancy plan, redundancies during the reporting No [X] including reasons for redundancies, number of period? workers involved, how they were selected, consultation undertaken, and measures to mitigate the effects of redundancy: Are any redundancies to the Yes [ ] If Yes, please describe the redundancy plan, workforce planned for the next No [X] including reasons for redundancies, number of year? workers involved, and selection and consultation process:

Were there any changes in trade Yes [x] If Yes, please provide details, and summarise union representation at Company No [ ] engagement with trade unions during reporting plants during the reporting period? period: Change of the chairman of a trade union following expiry of the previous chairman’s term of office. Were there any other worker Yes [ ] If Yes, please provide details and summarise representatives (e.g. in the No [X] engagement with them during the reporting period: absence of a trade union)? - Were there any changes in the Yes [ ] If Yes, please provide details: status of Collective Agreements? No [X] - Have employees raised any Yes [ ] If Yes, please state how many, split by gender, grievances with the project during No [X] summarise the issues raised in grievances by male the reporting period? and female staff and explain how the Company has addressed them: Have employees raised any Yes [ ] If Yes, please state how many, split by gender, complaints about harassment or No [X] summarise the issues raised by male and female bullying during the reporting staff and explain how the Company has addressed period? them: Have there been any strikes or Yes [ ] If Yes, please summarise nature of, and reasons for, other collective disputes related No [X] disputes and explain how they were resolved: to labour and working conditions - at the Company in the reporting period? 13

Have there been any court cases Yes [X] If Yes, please summarise the issues contested related to labour issues during the No [ ] and outcome: reporting period? Actions for compensation: 1 – pending. Actions for reinstatement to employment: 8 – all pending. Have there been any changes to Yes [X] If Yes, please give details, including of any new the following policies or terms No [ ] initiatives: and conditions during the In 2020, one supplement to the Collective Bargaining reporting period in any of the Agreement was signed. following areas: The supplement concerned: − Trade union recognition − change in percentage value defined in the Base − Collective Agreements Pay and Shift Allowance Table, − Non-discrimination and equal − changes in percentage salary ranges for trade opportunities for all union chairs, persons sitting on the Trade − Equal pay for equal work Unions Board, and person holding the position − Gender equality of Social Labour Inspector at the Company, − Bullying and harassment, − change in rules for granting length-of-service including sexual harassment increment, − Employment of young workers − change in rules for payment of length-of- under 18 service awards. − Wages and salaries (for regular and overtime hours) − Overtime − Working hours − Flexible working / work-life balance − Grievance mechanism for workers − Health & safety

7. Occupational Health and Safety Data Please provide the name and Marcin Trochimowicz, Head of Occupational Health & Safety contact details for your Health Telephone: (+48) 77 481-22-53 and Safety manager: Mobile: (+48) 695-380-826 [email protected] Direct Contracted Direct Contracted employees workers employees workers Number of man- hours worked in Number of 2,464,799 0 0 0 this reporting fatalities 7: period: Budget spent on Number of OHS in this period 1,995.73 0 disabling 0 0 (total amount and PLN '000 injuries: currency): OHS training Number of Lost provided in this Time Incidents 1,272 0 4 0 period in person- (including days: vehicular): Number of lost Number of cases workdays 124 0 of occupational 0 0 resulting from disease: incidents: Number of sick 30,209 days: Accident causes (falling, heavy loads, struck by object, contact with energy source etc.): • fall in a passageway (3) • contact with a hot object (1) Please provide details of any fatalities or major accidents that have not previously been reported to EBRD, including total compensation paid due to occupational injury or illness (amount and currency): No such occurrences Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period:

Employees of Grupa Azoty ZAK S.A. receive emergency prevention and response training during periodic OHS instructions in compliance with the P-03/C ‘Training’ procedure – in 2020, a total of 1,017 blue- and white-collar employees were trained in emergency prevention and response. The Chemical Rescue Division also addresses these topics while training Grupa Azoty ZAK S.A.’s Departmental Chemical Rescue Team. Please summarise any emergency response exercises or drills that have been carried out during the reporting period:

In 2020, no exercises or training were carried out for the Departmental Chemical Rescue Team due to the epidemic threat.

At noon on the first Tuesday of each month, a Company Shift Dispatcher announced a second degree drill alarm in accordance with the rules adopted at the Company. On a daily basis, Company Shift Dispatchers also ran operating tests of the emergency channel (the most important means of communication during rescue operations at Grupa Azoty ZAK S.A.). 8. Stakeholder Engagement Please provide the name and contact details Jerzy Naszkiewicz for your external relations or community Head of the Fertilizer Product Communication engagement manager: and Marketing Office Telephone: (+48) 77 481 24 83 Email: [email protected] Please provide information on the implementation of the Stakeholder Engagement Plan agreed with EBRD and summarise interaction with stakeholders during the reporting period, including: 15

− meetings or other initiatives to engage with members of the public or public organisations during the reporting period − information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: − coverage in the media: − interaction with any environmental or other community groups. Please describe any changes to the Stakeholder Engagement Plan agreed with EBRD:

The Company takes care to ensure clarity and consistency in communicating with its market environment, local community and the media. All material events and activities are announced by the Company through the media by maintaining contacts with the press, issuing press releases and getting coverage in the media. The Company has in place a coherent visual identity system and advertising design ensuring that it is easily recognisable in advertising and promotional materials, as well as in contacts with the media and stakeholders. In 2020, due to the pandemic-related restrictions on face-to-face meetings, the Company adjusted its communications to the restrictions and sanitary measures applicable in Poland.

In its dialogue with stakeholder groups, the Company relies on a mix of available communications tools: − Employees: Intranet of Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. – internal service accessible exclusively to employees of Grupa Azoty Zakłady Azotowe Kędzierzyn S.A.; email (messages emailed to all employees through the wszyscy_ zak distribution list); internal memos; orders; meetings with employees at various levels (meetings of the Management Board and management personnel, meetings of the management personnel and employees – in 2020, the vast majority of such meetings were held in electronic form); information – IT channels (some employees use Skype for Business and Microsoft Teams for day-to-day communication and participation in training); guide for new employees as an onboarding manual. − Employees and persons from outside the Company: the corporate Grupa Azoty Magazine, social media: FB, Google+, Twitter, Youtube. − Social dialogue forum: meetings of the Company Management Board and HR Manager with trade unions and social labour inspectors. − - Retired employees: semi-annual meetings of the Seniors Club with the Company Management Board were suspended in 2020 due to the pandemic. − - Media: press releases, promotional and advertising publications; information published in the media section of the Company website; events addressed to local communities were suspended. − Local community: local media (press articles and releases, radio programmes etc.), social media. − - Customers and suppliers: advertising brochures, Customer Service Office, regular contacts of sales managers and directors with customers, fertilizer and Oxoplast product websites.

The Company maintains a central register of key stakeholders. How many complaints or grievances did the project receive from members of the public or civil society organisations during the reporting period? Please split by stakeholder group. Summarise any issues raised in the complaints or grievances and explain how they were resolved:

In 2020, Grupa Azoty ZAK S.A. received no complaints or grievances from the public and/or civil society organisations.

9. Community Development Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure:

Due to the COVID-19 pandemic in 2020, there were fewer applications for support of social initiatives in the CSR area. In the absence of cultural, amateur sports and other social initiatives, some sponsorship contracts/orders were suspended. Due to the pandemic, the Company’s key 16

promotional or charitable events (the Chemist’s Days, Smile Ball, Seniors Club meetings, employee volunteering initiatives) were cancelled.

On the basis of its Social and Sponsorship Policy, CSR Policy and Donation Policy, Grupa Azoty ZAK S.A. joined the following initiatives in 2020: − Social responsibility and sponsorship initiatives for culture − Social responsibility and sponsorship initiatives for amateur sports − Grupa Azoty ZAK S.A. scholarship programmes − Science and education programmes, − Research and development programmes, regional development initiatives In 2020, Grupa Azoty ZAK S.A. spent PLN 275,500.00 on CSR activities benefiting the local community.

Charitable giving policy The donation policy of the Grupa Azoty Group sets forth the rules of making donations and applies to all Group companies. Through donations, the Group seeks to actively respond to the needs of foundations, associations, schools, non-profit organisations and individuals in difficult circumstances. In particular, the Group supports projects contributing to the enhancement of medical care, social and educational development of children and youth, as well as other initiatives benefiting local communities. All donations are granted in line with the Group-wide Donation Policy as well the adopted Donation Granting Rules.

Pursuant to the Donation Policy applicable at Grupa Azoty ZAK S.A. and the Donation Granting Rules, in 2020 Grupa Azoty ZAK S.A. made donations for the following purposes: − providing social assistance, mainly to families and individuals in difficult circumstances, and promoting equal opportunities for such families and individuals, − charity, − cultivating and fostering Polish traditions and national identity, strengthening of national, civic and cultural awareness, − health protection and promotion, − support for the disabled, − support for people at retirement age, − activities supporting the development of local groups and communities, − science, higher education, schooling, and education systems, − activities for children and youth, including holidays for children and youth, − activities supporting national minorities, − activities supporting non-governmental organisations, − culture, arts, and protection of cultural property and national heritage, − supporting and promoting physical education, − environment protection, animal welfare and protection of natural heritage, − public safety and order, − rescue operations and civil protection, − provision of assistance to victims of natural disasters, military conflicts and wars in Poland and abroad, − promotion and organisation of volunteering projects, − assistance provided to the Polish diaspora and to Poles residing abroad, − support for veterans and victims of political repression, − promotion of the Republic of Poland abroad, − religious worship.

In total, in 2020 Grupa Azoty ZAK S.A. donated PLN 921,903 thousand to the causes listed above.

In view of the epidemic outbreak, in 2020 Grupa Azoty ZAK S.A. was particularly involved in the fight against COVID-19, consistently supporting healthcare institutions in the Opole Province in this respect.

Awards – Pro-environmental initiatives Since 1994, Grupa Azoty ZAK S.A. has been implementing the Responsible Care® programme. In 2020, the Company won the prestigious European Responsible Care Award in the Community Support category. Grupa Azoty ZAK S.A. is the first Polish company to have received an award in this category. 18

ENVIRONMENTAL AND SOCIAL ACTION PLAN

Table 0.1 Wisła Project, Grupa Azoty Poland – Environmental, Social, Health and Safety (ESHS) matters, Updated (Alchemist Project) Action Plan:

GRUPA AZOTY ZAKŁADY AZOTOWE KĘDZIERZYN S.A.

4. Actions required to maintain compliance with EHS requirements of national law and EU environmental standards - Zakłady Azotowe Kędzierzyn No. Action Environmental risks, liabilities/benefits Legislative Requirement Scheduled Target and Comments requirements/B /Resources completion – evaluation criteria est practice action to be for implementation completed by end progress of year 4.1 Complete the planned Reduce negative environmental impact in Legislative Investment 2015/2016 – Obtain a relevant Milestone 1 – construction of energy line with IED requirements. requirements, needs milestone 1 permit for the new completed generation installations to ensure best 2017-2021 – facility compliance with IED post 2016, The Company is planning to install new management milestone 2 Milestone 2 – taking into account the coal-fired boilers to replace old units. All practices, 2019-2024 – new Update information abandoned and derogations agreed upon with new units must comply with IED. Bank's PRs concept on the project in replaced with a competent authorities. the annual report, new concept selected technology (with a new Target emission levels: and target emission completion 3 200 mg/m for SO2 levels. date) 200 mg/m3 for NOx 20 mg/m3 for PM. Publish NTS of investment and provide copy/web link to Bank as part of annual report. 19

Information: Two milestones have been scheduled for the project on a preliminary basis, including: − 2014–2016: execution of milestone 1, i.e. construction of a coal-fired boiler house with a capacity of 140 Mg/h, installation of a 25 MWe pass- out and condensing turbine, and construction of a control centre building. This milestone was completed in 2017. − Originally, the following was planned for 2017−2021: execution of milestone 2 of the CHP project, as per the 2013 Feasibility Study, involving the construction of a second coal-fired boiler with a capacity of 140 Mg/h and a gas and oil-fired boiler house with a capacity of 2 x 70 Mg/h. Milestone 2 was ultimately abandoned on the Steering Committee’s recommendation to modify the ‘New CHP Plant at Grupa Azoty ZAK S.A. – milestone 2’ project under the Management Board’s Resolution No. 294/18 of October 11th 2018. In the first quarter of 2019, accompanying reports were drawn up for the ‘Innovative management of heat from ammonia production processes as an alternative to heat generation in coal-fired boilers’ concept. By official instruction No. 6/19 of March 6th 2019, a team was established to introduce and implement the New Concept. In April 2019, the team decided to select the gas-fired peak-load/reserve boiler house system configuration based on two new boilers with a capacity of 100t/h and 50t/h, respectively, for further preparatory work. The reserve boiler house functioning as a peak-load source will operate in conjunction with steam generators at the existing ZAK CHP plant. In the event of downtime of coal-fired boilers at the existing ZAK CHP plant, the peak-load/reserve boiler house will operate as a stand-alone reserve steam generator. On June 17th 2019, the Group’s Development Committee approved the new project for innovative management of heat from ammonia production processes as an alternative to heat generation in coal-fired boilers. On October 24th 2019, the Contract Award Committee was established in connection with the procurement procedure for the construction of a peak- load/reserve boiler house in accordance with the recommended concept. In accordance with a report approved on August 18th 2020, the Tender Committee selected the General Contractor for the project. On November 5th 2020, a contract was signed for the construction of a peak-load and reserve boiler house with the POLIMEX ENERGETYKA-POLIMEX Mostostal consortium. Work commenced in accordance with the agreed schedule. On January 20th 2021, the Project Information Sheet was submitted. 4.2 Complete restoration of the old Reduce negative environmental impact Legal Internal Ongoing waste landfill site and continue requirements/b resources monitoring of waste landfilling est and external conditions. management support practice Information: All landfill sites within Grupa Azoty ZAK S.A. premises, including inactive and restored sites, are monitored to ensure compliance with permits held. 4.3 Prepare a plan and potential Reduce negative environmental impact Best Internal Action plan and Prepare a plan and budget for removal of management resources potential budget potential budget for redundant/not operated practice and external to be decided in removal of installations/buildings and support 2013 and redundant/not structures updated in 2018 operational installations/buildings and structures 20

Information: Grupa Azoty Zakłady Azotowe Kędzierzyn S.A. is engaged in ongoing demolition of buildings, structures and systems which have been retired from service and are redundant for the Company’s purposes. In 2020 demolition work related to the decommissioning of idle pipelines – no idle buildings or structures were demolished. The expenditure incurred on the demolition of idle pipelines in 2020 was PLN 549,107.00 (exclusive of VAT).

Annual Environmental & Social Report

1. Information about the Company Company Name: Grupa Azoty Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A. Company Address: Grzybów 28-200 Staszów Country: Poland Town/Location: Staszów, Kielce Province Company authorised representative: Andrzej Zieliński I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period. Signature: Andrzej Zieliński Title: Member of the Management Board Date: April 15th 2021 Contact Details: Telephone: (+48) 158 649 206 Mobile: (+48) 665 666 524 Email: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide:

Item Cumulative

[PLN ‘000] 2019 2020

Revenue 236,018 179,793 Profit/(loss) on sales -25,348 -45,338 EBIT -33,100 -32,675 EBITDA -11,437 -11,999 Net profit/(loss) -35,290 -32,102

Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions;

Number of staff employed and any change in employment over past 3 years

As at Dec 31 As at Dec 31 As at Dec 31 As at Dec 31 2017 2018 2019 2020

Number of direct employees: 777 797 848 802 Number of contracted workers: - - -

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive)

1 2

Reporting period: 2020

2. General Is the project materially compliant Yes [ ] If No, please provide details of any material with all relevant EBRD Performance No [ ] non-compliances: Requirements (taking account of agreed action plans, exemptions or Not applicable derogations)? Is the project materially compliant Yes [ ] If No, please provide details of any material with all applicable environmental and No [ ] non-compliances: social laws and regulations? Not applicable Have there been any accidents or Yes [ ] If Yes, please describe, including details of incidents that have caused damage to No [X] actions to remedy and prevent reoccurrence: the environment, brought about injuries or fatalities, affected project labour or local communities, affected cultural property, or created liabilities for the Company? Have there been any changes to Yes [ ] If Yes, please describe: environment, social, labour or health No [X] and safety laws or regulations that have materially affected the Company? How many inspections did you receive Number: Please provide details of these visits, including from the environmental authorities 1 number and nature of any violations found: during the reporting period? Inspection of compliance with the regulations concerning chemical substances and their mixtures, and prevention of major industrial accidents. No violations were found. How many inspections did you Number: 1. In 2020, inspectors of the National receive from the health and safety 8 Labour Inspectorate (PIP) carried out 1 authorities during the reporting inspection at the Company, resulting in period? the issuance of 1 improvement notice (which the Company has complied with). 2. In 2020, inspectors of the National Sanitary Inspectorate (PIS) carried out 2 inspections, as a result of which no decision was issued. 3. In 2020, inspectors of the Regional Mining Authority carried out 4 inspections, as a result of which no decision was issued. 4. In 2020, inspectors of the State Mining Authority carried out 1 inspection, as a result of which no decision was issued.

How many inspections did you Number: receive from the labour authorities 0 during the reporting period? Have these visits resulted in any Yes [ ] penalties, fines and/or corrective No [x] action plans?

2 3

Has the Company engaged any Yes [ ] contractors for project-related work No [ ] in the reporting period? Yes [ ] If Yes, please provide details, including how the Were any of the violations stated No [ x] Company is ensuring that corrective actions are above the responsibility of implemented by the contractor? contractors? Not applicable

Have any operations been reduced, Yes [ ] If Yes, please describe: temporarily suspended or closed down No [ x] due to environmental, health, safety or labour reasons? Please describe any environment or social programmes, initiatives or sub-projects undertaken during the reporting period to improve the Company's environmental or social performance and/or management systems:

Environmental initiative or sub-project: In 2018, Grupa Azoty Siarkopol S.A. implemented and obtained a certificate for its Management System compliant with PN-EN ISO 14001:2015 and PN-EN ISO 9001:2015 standards. The Certificates are valid until August 8th 2021. Social initiative:

CSR and sponsorship activities are frequently used by businesses as a means of promotion and support for local communities. Promoting the brand, building a positive image and undertaking initiatives directed at the Company’s major stakeholders are among key objectives pursued through CSR and sponsorship initiatives. These activities, carried out in a transparent manner and with the aim of delivering tangible promotional and image-building benefits, help both the sponsor and the sponsored party build value and convey a positive image.

There is no expenditure associated with the requirements of the Environmental and Social Action Plan; the expenditure relates to the Company's own initiative.

In 2020, no CSR or sponsorship initiatives were undertaken as such initiatives were not included in the Plan of CSR and Sponsorship Activities for 2020. On the other hand, social initiatives were undertaken by disbursing funds allocated to donations. For detailed information on such donations, see further below. The expenditure incurred for these purposes was not related to the requirements of the Environmental and Social Action Plan.

Not applicable

4. Environmental Monitoring Data for each of the key subsidiaries The information required in this section can be extracted from a CSR report, or a full CSR report can

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be attached.

Please provide the name and contact Head of Environmental Protection details for your environmental Elżbieta Molas, telephone: (+48) 15 86-49-192 manager: [email protected]

Parameter2 Amount3 Unit Compliance Status4 Comments5 Wastewater Chemical Plant Total wastewater 71,690 m3/year compliant Biochemical 404 kg/year compliant Oxygen Demand (BOD5) Chemical Oxygen 2,918 kg/year compliant Demand (COD) Suspended solids 1,298 kg/year compliant Phosphorus no data monitoring of this parameter is not available required Nitrates no data monitoring of this parameter is not available required Heavy metals monitoring of this parameter is not required [Other]

Air Per each emissions major point source Chemical Plant

SO2 59.926 Mg/year compliant Nitrogen oxides Mg/year compliant 48.31 (NOX) Particulates 0.96 Mg/year compliant

CO2 7,220.68 compliant Other parameters compliant

CS2 0.69 Mg/year compliant

Toluene 6.09 Mg/year compliant Sulfur

Mine particulates 0.55 Mg/year compliant Other

parameters

H2S 0.0007 Mg/year compliant Noise Daytime dB Acceptable values in accordance with the Analysis of Equivalent level of 39.5±2.4 permit: noise sound A over time 44.0±2.5 daytime: 55 dB emission T Night-time night-time: 45 dB measurement 39.0±2.0 s taken at the 38.3±2.1 Chemical Plant in 2020 [Other] Solid waste

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Hazardous solid Quantity generated consistent with the waste integrated permits for the Chemical Plant (major types) in Dobrów and the sector permit for the Osiek Sulfur Mine 13 08 99* Wastes not Recovery 66.680 Mg otherwise method: R3 specified 16 02 13* Discarded equipment containing Recovery hazardous 0.043 Mg method: R12 components5) other than those mentioned in 16 02 09 to 16 02 12 16 05 06* Laboratory chemicals Disposal consisting of or 0.100 Mg method: D14 containing hazardous substances Non-hazardous Quantity generated consistent with the solid waste integrated permits for the Chemical Plant (major types) in Dobrów and the sector permit for the Osiek Sulfur Mine 01 05 07 Barite-containing drilling muds and Recovery wastes other than 252.280 Mg method: D5 those mentioned in 01 05 05 and 01 05 06 03 01 05 Sawdust, shavings, cuttings, wood, Recovery particle board and 0.223 Mg method: R12 veneer other than those mentioned in 03 01 04 15 01 02 Recovery 3.020 Mg Plastic packaging method: R1 15 02 03 Absorbents, filter materials, wiping cloths and Recovery 0.088 Mg protective clothing method: R1 other than those mentioned in 15 02 02 16 01 19 Recovery 0.450 Mg Plastics method: R12 17 04 02 22.860 Mg Recovery Aluminium method: R4 17 04 05 2571.18 Mg Recovery Iron and steel method: R4

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Important note: Relates to waste quantities generated in connection with the Plant's operation – not applicable to the project

5. Resource Usage and Product Output (2020) Measureme Parameter Amount Comments6 nt Unit Fuels used Crude oil Natural gas 43,472.356 MWh Hard coal Lignite Grid electricity 26,511.244 MWh Joint purchases (Dobrów + Grzybów + Osiek area) Heat purchased 493,473.333 MWh Heat in hot water, supplied from the from external Połaniec Power Plant sources Used feedstocks and raw materials Name 1 4,447.0 Mg Petrochemical sulfur Name 2 1,645.8 Mg Oil Product output Product 1 417,848 Mg S Product 2 6,075.600 Mg SN

6. Human Resources management Please provide the name and contact details for your Human Resources manager: Wiesław Jerzy Anioł Recruited in this Terminated in this Telephone: (+48) 15 86-49-260 Total reporting period reporting period [email protected] Number of direct employees: 802 41 40

Number of contracted - - - workers: Were there any collective Yes [ ] If Yes, please describe the redundancy plan, redundancies during the No [ x] including reasons for redundancies, number of reporting period? workers involved, how they were selected, consultation undertaken, and measures to mitigate the effects of redundancy: Are any redundancies to the Yes [ ] If Yes, please describe the redundancy plan, workforce planned for the No [ x] including reasons for redundancies, number of next year? workers involved, and selection and consultation process: Were there any changes in Yes [ ] If Yes, please provide details, and summarise trade union representation at No [X] engagement with trade unions during the reporting Company plants during the period: reporting period?

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Were there any other worker Yes [ ] If Yes, please provide details and summarise representatives (e.g. in the No [x ] engagement with them during the reporting period: absence of a trade union)? Were there any changes in the Yes [ ] If Yes, please provide details: status of Collective No [x] Agreements? Have employees raised any Yes [ ] If Yes, please state how many, split by gender, grievances with the project No [ x] summarise the issues raised in grievances by male during the reporting period? and female staff and explain how the Company has addressed them: Have employees raised any Yes [ ] If Yes, please state how many, split by gender, complaints about harassment No [x ] summarise the issues raised by male and female or bullying during the staff and explain how the Company has addressed reporting period? them: Have there been any strikes or Yes [ ] If Yes, please summarise nature of, and reasons for, other collective disputes No [x ] the disputes and explain how they were resolved: related to labour and working conditions at the Company in the reporting period?

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Have there been any court Yes [X] If Yes, please summarise the issues contested and cases related to labour issues No [ ] outcome: during the reporting period? 1. Action brought by Jarosław K. for recognition as unlawful of the contract termination pursuant to Art. 52.1.1 of the Polish Labour Code, payment of compensation, and rectification of the work certificate. The case is closed. By its judgment of November 29th 2018, the District Court of Sandomierz dismissed the claim brought by Jarosław K., charging him with court costs. On February 5th 2019, the plaintiff appealed against the judgment. By its judgment of October 2nd 2019, the Regional Court of Kielce reversed the judgment appealed against by the plaintiff and awarded an amount of PLN 21,060 from the Company to Jarosław K. as compensation for unlawful termination of his employment contract without notice, along with statutory interest accrued from March 2nd 2018 to the payment date, as well as PLN 180 and PLN 150 to cover attorney costs incurred, respectively, in the first instance and second instance proceedings. The Court also ordered to charge the Company with an amount of PLN 1,053 as reimbursement of the court costs from which the plaintiff was exempted. 2. Action brought against the Company by Sławomir B. for an increase in pension. The case is pending. In his claim, served on the Company on March 21st 2019, its former employee entitled to a pension awarded to him from the Company in connection with an accident he had suffered at work, demanded that the pension be increased from PLN 2,000 to PLN 4,000, and that an amount of PLN 70,000.00 be additionally awarded for his benefit as compounded pension instalments for the period from February 2016 to December 2018.

The District Court of Sandomierz – following the defendant’s allegation that it was not a competent venue – issued a decision declaring its lack of competence and referred the case to the Regional Court of Kielce.

The case was referred to the Regional Court of Kielce as the competent court.

The date of the hearing was scheduled for March 6th 2020.

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Have there been any changes Yes [ ] If Yes, please give details, including of any new to the following policies or No [x ] initiatives: terms and conditions during the reporting period in any of the following areas: − Trade union recognition − Collective Agreements − Non-discrimination and equal opportunities for all − Equal pay for equal work − Gender equality − Bullying and harassment, including sexual harassment − Employment of young workers under 18 − Wages and salaries (for regular and overtime hours) − Overtime − Working hours − Flexible working / work- life balance − Grievance mechanism for workers − Health & safety

7. Occupational Health and Safety Data Please provide the name and Michał Markiewicz – Head of the OHS and Environmental contact details for your Health Protection Centre and Safety manager: Telephone No. (+48) 15 864 9420, Mobile (+48) 784 025 659 [email protected]

Direct Contracted Direct Contracted employees workers employees workers Number of man- 1,586.0 Number of 0 hours worked in thousand fatalities 7: this reporting period: Budget spent on PLN 1,307,826.0 Number of 0 OHS in this period disabling (total amount and injuries: currency): OHS training 25 training Number of Lost provided in this sessions Time Incidents 1 period in person- for 189 (including days: employees vehicular): Number of lost Number of cases workdays 170 of occupational resulting from disease: incidents: Number of sick days:

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Causes of incidents (falling from height) - use of inappropriate footwear, - employee supervisor’s ignoring OHS non-conformance, - non-conformance with OHS rules and regulations.

Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period: None was provided.

Please summarise any emergency response exercises or drills that have been carried out during the reporting period: Mining rescuers designated by the employer are drilled every two months to ensure they are prepared to respond to an emergency (fire, explosion, hot substance spill). The chemical rescue team of the Chemical Plant were drilled once a quarter to improve their ability to respond to an emergency (fire, explosion, hazardous substance leakage/spill). All chemical rescuers also underwent test drills at the Grupa Azoty Rescue Education Centre. Moreover, every year State Fire Service officers perform inspection and examination activities at all of the Company's plants.

8. Stakeholder Engagement Please provide the name and contact details Not applicable for your external relations or community engagement manager: Please provide information on the implementation of the Stakeholder Engagement Plan agreed with EBRD and summarise interaction with stakeholders during the reporting period, including: − meetings or other initiatives to engage with members of the public or public organisations during the reporting period − information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: − coverage in the media: − interaction with any environmental or other community groups. Please describe any changes to the Stakeholder Engagement Plan agreed with EBRD:

Grupa Azoty Siarkopol has no Stakeholder Engagement Plan.

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There were no such issues.

9. Community Development Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure:

• In 2020, the Company made donations of PLN 47,000, both in kind and in cash. The in-kind donations included advertising gadgets provided to the Dom Ojca Gwidona (Father Guido Home) Residential Care Facility in Pacanów to support an auction intended to raise funds for a new home for children and young people, as well as a ‘basket-heart’ for collecting plastic bottle caps, donated to the Jędrusie Home Army Militia Squad School Complex in Połaniec. The basket is used by the local community to collect caps, which are then donated to support charitable causes. In addition, personal protective equipment was donated to the Independent Self-Governing Trade Union Solidarity of the Kielce Region. An in-kind donation of advertising gadgets was also provided to ‘Krewniacy’, the Blood Donor Club operating at Grupa Azoty Siarkopol. The financial donations were provided to: the Independent Public Healthcare Complex in Staszów to combat the Covid-19 pandemic, as well as to private individuals to support their medical treatment. • In 2020, the Plan of CSR and Sponsorship Activities did not earmark any funds for sponsorship projects.

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ENVIRONMENTAL AND SOCIAL ACTION PLAN

Table 0.1 Wisła Project, Grupa Azoty Poland – Environmental, Social, Health and Safety (ESHS) matters, Updated (Alchemist Project) Action Plan:

GRUPA AZOTY KOPALNIE I ZAKŁADY CHEMICZNE SIARKI SIARKOPOL S.A.

6. Actions required to maintain compliance with EHS requirements of national law and EU environmental standards – GRUPA AZOTY KOPALNIE I ZAKŁADY CHEMICZNE SIARKI SIARKOPOL S.A. No. Action Environmental risks, liabilities/benefits Legislative Requireme Scheduled Target and Comments requirements/ nt/Resourc completion – evaluation Best practice es action to be criteria for completed by implementation end of year progress 9.1 Monitoring of Reduce negative environmental Legislative Internal Ongoing/ad-hoc Summary in the environmental impact with impact in line with IED requirement and and periodic annual report for respect to gas and s, best external reports the Bank particulates emissions into managemen the air and quality of t practices, discharged effluents, as Bank's PRs well as assessment of the condition of surface water in the area covered by facilities for which an Integrated Pollution Prevention and Control (IPPC) permit is required. Information

In 2020, the Chemical Plant in Dobrów continued to implement integrated environmental protection measures, taking into account applicable legal requirements, environmental protection standards and safety.

Legal requirements: The Chemical Plant's facilities operate on the basis of the following integrated (IPPC) permit and notification:

1. Decision of the Marshal of the Kielce Province Ref. No. OWŚ-VII.7222.5.2017 of August 31st 2017, as amended by Decision Ref. No. OWŚ- VII.7222.26.2019 of December 23rd 2019, granting an integrated (IPPC) permit for facilities producing sulfur insoluble in carbon disulfide, located at the Chemical Plant in Dobrów, rural district of Tuczępy. 2. Notification of a sulfur mill with a capacity of up to 2 Mg/h, emissions from which do not require a permit but must be notified. Not. card number 000080/2017. 12 13

Soil, ground and groundwater protection at the Chemical Plant is achieved by: - tight sealing of processes. Processes at the Chemical Plant are conducted in sealed devices made of materials suitable for the type of process media used, - use of systems in which tanks may be drained by pumps (in case of emergency), with their content directed to the network or another tank, - ensuring good technical condition of underground infrastructure to prevent leakage from interceptors, - application of impermeable materials (equipment and devices are placed on a concrete surface, with any leakage drained to the industrial wastewater system), - use of devices to measure and monitor the level of liquids in tanks, connected to a lock-out system, - identification of wastewater and its analysis in terms of quality and volume, - minimum amount of water used in the process (stripping and returning water back to protective cushions), - cooling with water from the closed-loop cooling water system, - maintaining good condition of surface water intake points and other equipment used to supply water to the plant for process and other purposes, - rational waste management system, - appropriate procedures for all operations associated with the handling and transport of liquids, - regular inspections of the technical condition of plant and equipment. Environmental parameters are monitored in accordance with the requirements set out in integrated (IPPC) permits: - monitoring of pollutant emission levels. Measurement of concentrations and emissions of sulfur dioxide (SO2), carbon disulfide (CS2) and toluene from the plant's emission source (twice a year) and of SO2, NO2 and particulates content in flue gas emissions from the plant’s CCGT unit (at least once a year) by an accredited laboratory. - monitoring of the amount and quality of surface water drawn from the Czarna Staszowska river, - surface water quality tests performed in the section starting in Oględów, in ducts located above and below the channel outlet, in terms of parameters specified in the applicable decision; frequency: once every two months, - industrial wastewater quality tests performed at the interceptor outlet to the open channel, in terms of pollution parameters specified in the applicable decision; frequency: once every two months, - regular measurements of noise generated by the plant during day- and night-time, so as to determine and analyse the impact of noise on the environment in the immediately surrounding area protected from noise, - monitoring and recording of waste, in accordance with law. Safety: The Chemical Plant has a Safety Report, approved by the Commander-in-Chief of the State Fire Service in the Kielce Province by Decision Ref. No. WZ- 5586.1.16.2015, of October 26th 2015 and Decision Ref. No. WZ.5586.6.1.2019 of the Kielce Province Commander-in-Chief of the State Fire Service, dated August 21st 2019, approving amendments to the Dobrów Chemical Plant Safety Report. Under the Decision, the plant's operator is ready to roll out a programme to prevent and manage industrial accidents, in accordance with the Internal Rescue Operation Plan.

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9.2 Monitor environmental Reduce negative environmental Legislative Internal Ongoing/ad- Summary in the impacts of mining operations, impacts in accordance with IED, and requirement and hoc and annual report for restoration of mining sites, implement measures expected by the s, best external periodic the Bank and reclamation of post- local community. managemen reports mining land for use, in t practices, accordance with applicable Bank's PRs legal decisions and public needs.

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Information: In 2020, the Osiek Sulfur Mine continued to implement integrated environmental protection measures, taking into account applicable legal requirements, environmental protection standards, safety, and the local community’s needs. The monitoring of environmental impacts of the Osiek Sulfur Mine covers: surface protection, restoration of post-mining sites, waste management, water and wastewater management, protection of surface water and groundwater, and air pollution control. Measures taken to eliminate negative environmental impacts of mining activities on the ground's surface include: safety pillars and designation of mining protection areas, eruption prevention measures, and measurements of ground subsidence. Restoration of post-mining sites Given the terrain in the Osiek deposit area, which includes a low and high terrace, and the earlier ground subsidence, restoration models other than agriculture, afforestation and tree planting need to be determined. This applies in particular to the Vistula valley forming the lower terrace. The ‘Legal and environmental study for the restoration of the Osiek mining sites’, prepared in 2011 at our request by Stanisław Staszic's Scientific Association of Kraków (Stowarzyszenie Naukowe im. Stanisława Staszica w Krakowie), proposes an afforestation/tree planting/water restoration model for the lower terrace, with an option of creating natural water reservoirs in areas with a considerable degree of subsidence. This will be possible after full discontinuation of mining work in the high terrace. The mine currently holds the following decisions determining the possible land restoration models: - Decision No. G.II-6012/3/96 of July 5th 1996, determining the afforestation model for restoration of 16.30 hectares of land in the area of former A-1 and A-2 control rooms. - Decision No. G.III-6019/8/2003 of August 26th 2003, determining the afforestation model for restoration of 28.9668 hectares of land situated in Mikołajów and in Osiek - cadastral district No. 2 (formerly Osieczko), and the agricultural model for reclamation of 1.2210 hectares of land. - Decision No. OŚ.II-6019/4/2010 of April 6th 2010, determining the afforestation model for restoration of 20.50 hectares of land situated in Mikołajów and 10.3996 hectares in Osiek - cadastral district No. 2, and the tree planting model for restoration of land located in Mikołajów (89.04 hectares), in Osiek - cadastral district No. 2 (formerly Osieczko - 35.6894 hectares), and in the town of Osiek (1.46 hectares). - Decision No. OŚ.6122.8.2011.III.D of August 5th 2011, determining the tree planting model for restoration of 10.7138 hectares of land situated in Mikołajów.

- Decision No. OŚ.6122.6.2011.III.D of August 5th 2011, determining the agricultural model for reclamation of 7.91 hectares of land situated in Trzcianka. - Decision No. OŚ.6122.8.2011.III.D of the Staszów County Head of March 21st 2012, concerning correction of a calculation error in Decision No. OŚ.6122.8.2011.III.D of August 5th 2011. - Decision No. OŚ.6122.7.2013.III.D of the Staszów County Head of August 26th 2013, determining the tree planting model for restoration of plot No. 961 with an area of 0.0576 hectares, situated in cadastral district No. 2 in Osiek. - Decision No. OŚ.6122.4.2014.III.D of the Staszów County Council of March 12th 2014, determining the tree planting model for restoration of plot No. 1087 with an area of 0.4798 hectare, situated in cadastral district No. 2 in Osiek.

- Decision No. OŚ.6122.11.2014.III.D of the Staszów County Council of August 6th 2014, determining the tree planting model for restoration of a part of plot No. 731/2 with an area of 0.3677 hectare, situated in cadastral district No. 2 in Osiek. - Decision No. OŚ-IV4.6122.5.2017 of the Staszów County Council of May 19th 2017, determining the afforestation model for restoration of 3.3426 hectares of land situated in Mikołajów. - Decision No. OŚ-IV4.6122.11.2017 of the Staszów County Council of November 23rd 2017, determining the afforestation model for restoration of 23.3248 hectares of land situated in Pliskowola and the agricultural model for reclamation of 24.3977 hectares of land situated in Pliskowola and 0.4300 hectare of land situated in Trzcianka. - Decision No. OŚ-IV4.6122.8.2020 of the Staszów County Head of December 28th 2020, determining the afforestation model for restoration of 4.7250 hectares of land situated in Mikołajów and the agricultural model for restoration of 1.0900 hectares of land situated in Mikołajów. Under the above decisions, a part of plot No. 1438 with an area of 8.0580 hectares situated in cadastral district No. 2 in Osiek (the area of former A-1 and A-2 control rooms) was restored; Decision No. OŚ.6122.8.2013.III.D of September 6th 2013 regarding completion of the restoration process was obtained from the Staszów County Head; agricultural reclamation of 7.1318 hectares of land situated in Trzcianka was performed; and Decision No. OŚ.6122.13.2013.III.D of January 9th 2014 regarding completion of the restoration process was obtained.

Under Decision No. OŚ.II.6019/4/2010 determining the restoration model, and Decision No. OŚ.6237.1.2011.IIIB approving the closure of the waste drilling mud landfill site located in Mikołajów, restoration of the site was performed based on the relevant technical documentation. By Decision No. OŚ.6122.14.2014.III.D of November 7th 2014, the Staszów County Head determined that restoration of the waste drilling mud landfill site had been completed. The landfill site is currently in the after-care phase and is subject to monitoring in accordance with the Landfill Regulation of the Minister of Environment (Dz.U.2013.523) in terms of the ground subsidence area as well as the level and quality of groundwater. Under Decisions No. G.III-6019/8/2003 and OŚ.II.6019/4/2010 on land restoration models, restoration was performed on land located in Osiek (cadastral district No. 2) and Mikołajów, with a total area of 8.5055 hectares, including: • Region No. 2 with an area of 2.9015 hectares, located in the area of the former A-5 control room (restoration by afforestation), • Region No. 3 with an area of 5.6040 hectares located east of the A-7R control room, between the pre-main route No. 3 and pre-main pipeline No. R-IV, (restoration by afforestation of 5.3473 hectares and restoration by tree planting of 0.2567 hectare); and Decision No. OŚ.6122.15.2016.III.D of December 16th 2016 was obtained from the Staszów County Head determining that the land restoration process had been completed. Under the decisions on restoration models, i.e. OŚ.II-6019/4/2010 and OŚ.6122.8.2011.III.D, the land restoration process was carried out within Region No. 4, located in Mikołajów and Osiek (cadastral district No. 02), with a total area of 21.7444 hectares; whereupon the Staszów County Head’s Decision No. OŚ.6122.17.2016.III.D of May 19th 2017 and the Staszów County Head’s Ruling No. OŚ.IV4.6122.10.2017 of July 20th 2017 were obtained determining that the land restoration process had been completed.

On the basis of Decision No. OŚ. II-6019/4/2010 of the Staszów County Head of April 26th 2010 determining the tree planting model for land restoration, the restoration of 3.60 hectares of land located in Mikołajów (Region No. 6) commenced in 2020. In 2020, the technical restoration phase was completed.

Rational waste management Management of waste, including mining waste from the Osiek Sulfur Mine, is in line with the applicable laws and administrative decisions issued by the Marshal of the Kielce Province: - Waste generation permit covering waste generated by the Sulfur Mine, dated December 31st 2014, Ref. No. OWŚ-VII.7221.2.44.2014, as amended by Decisions OWŚ-VII.7221.2.23.2015 of August 13th 2015 and OWŚ-VII.7221.2.7.2017 of June 8th 2017. - Mining waste management programme, Decision No. OWŚ-VI.7240.1.1.2017 of March 27th 2017. - Permit No. OWŚ-VI.7240.6.1.2017 of August 3rd 2017 to operate a mining waste disposal facility. In compliance with the requirements of the Act on Mining Waste, Grupa Azoty Siarkopol reviewed its mining waste management programme. The adopted waste management, handling and storage methods have no adverse environmental impacts. The prescribed period for the storage of waste before its disposal is complied with. The waste records are maintained in the Waste Database (BDO) electronic system.

Annual results of the observations and their interpretation, together with attached maps, form the basis for a report on the impacts of mining activities on the rock mass and mining sites, drawn up by March 31st of the following year. If any impacts of mining activities on the quality of groundwater are identified, appropriate measures are taken to eliminate them. Such measures may include changes in the direction of extraction or use of protective barriers.

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Surface water protection Protection of surface water in the area of the Osiek Sulfur Mine is based on: introduction of a closed-loop system for formation waters, eruption-free extraction of sulfur, introduction of a closed-loop system for sanitary and industrial wastewater, moving of watercourses and ditches outside the mining sites and changing their functions, regular testing of water quality in ditches and watercourses within the area of the mine. Following the introduction of a closed-loop system for formation waters, the mine does not discharge any wastewater to the environment. The quality parameters of surface waters are monitored once a month. The monitoring covers the following surface waters: the Wisła river and Ocieckie Lake, the watercourse from Pliskowola, the watercourse from Mikołajów, and the watercourse from Mucharzew and the Strzegomka river. Protection of groundwater Groundwater is protected based on a system of observations conducted in accordance with the 'Instruction for hydrogeological observations regarding the method, scope and frequency of observations, measurements and tests as well as their recording', approved by the Mine Operation Manager.

Air pollution control Air pollution control in the area of the Osiek Sulfur Mine is based on: - tight sealing of the decompression system and chemisorption installation for on-site sulfur tanks, - ongoing drainage of the area to prevent formation of pools which would emit hydrogen sulfide, - regular monitoring of H2S ambient concentrations. Measurements of H2S ambient concentrations in the area of the Osiek Sulfur Mine are performed at four points in Osiek, Osieczek, Pliskowola and Trzcianka. Since 2013, measurements of hydrogen sulfide ambient concentrations have been averaged for one-hour periods, in line with the regulations currently in effect. In the Decision of March 8th 2013 Ref. No. OWS VII.7221.1.12013, the Marshal of the Kielce Province repealed the earlier Decision of the Governor of the Tarnobrzeg Province of March 12th 1993 Ref. No. OŚ-IIB-7644/7/93, as amended on March 10th 1997 (Ref. No. OŚ-II-7644/4/97/JM), as well the Decision of the Governor of the Kielce Province of October 23rd 2003 Ref. No. ŚR.II.6610/1-3/03, imposing on Kopalnie i Zakłady Chemiczne Siarki Siarkopol S.A. of Grzybów an obligation to monitor air pollution within the site's impact area.

Environmental standards and needs of local communities Having regard to Art. 144 of the Environmental Protection Law and the provisions of Par.165 and 166 of the Regulation of the Minister of Economy dated April 25th 2014 on specific requirements for the operation of mining facilities producing minerals through wells (Dz.U.2014.812), the Osiek Sulfur Mine continues to monitor the ambient concentrations of hydrogen sulfide in Osiek, Osieczko, Pliskowola, Trzcianka and Lipnik, regardless of the decision issued by the Marshal of the Kielce Province abolishing the obligation to conduct air pollution monitoring in the area of the mine. The monitoring has been conducted since 1994, having provided extensive amounts of comparative data, which has proved very useful in resolving disputes with local authorities and residents.

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18 1

Annual Environmental & Social Report

1. Information about the Company Company Name: Grupa Azoty Zakłady Chemiczne Police S.A. Company Address: ul. Kuźnicka 1, 72-010 Police Country: Poland, Szczecin Province Town/Location: Police Company authorised representative: I certify that the data contained in this report completely and accurately represents the Company’s operations during the reporting period. Signature: Jarosław Konopacki Title: Head of Plant Safety Department Date: April 15th 2021 Contact Details: Telephone: (+48) 91 317 13 68; Mobile: (+ 48) 887 744 415 Email: [email protected]

Please provide key data on the Company performance, as well as production levels at each plant. For each of the 7 large plants please provide: Key performance indicators in terms of energy consumption, emissions, use of natural resources, and carbon dioxide emissions;

Item Cumulative

[PLN ‘000] 2019 2020

*Revenue 2,419,091 2,397,411 Profit/(loss) on sales 68,138 53,186 EBIT 68,652 75,085 EBITDA 194,253 209,106 Net profit/(loss) 60,487 83,708

Number of staff employed and any change in employment over past 3 years

As at Dec 31 2018 As at Dec 31 2019 As at Dec 31 2020 Number of direct employees: 2,553 2,560 2,526 Number of contracted workers: 0 0 0

Provide information on permits and each subsidiary’s compliance status with IPPC/IED (Integrated Pollution Prevention and Control Directive/Industrial Emissions Directive) Grupa Azoty Zakłady Chemiczne Police S.A. monitors changes in environmental protection regulations on an ongoing basis and takes measures to ensure continuous compliance. The Company takes part in public consultations announced by competent public administration authorities, voicing its comments on draft legislation. In accordance with the integrated permit, the Company fulfils the obligation to assess the risk of soil, land and groundwater contamination with substances used in technological processes. The assessment takes into account technical and organisational actions, as well as measures taken to prevent soil, land and groundwater contamination.

INTEGRATED PERMIT

Grupa Azoty Zakłady Chemiczne Police S.A.’s production and auxiliary units are operated based on the integrated (IPPC) permit issued by way of a decision of the Marshal of the Szczecin Province dated January 9th 2014. The permit was issued for an indefinite period. The validity of the integrated permit is monitored on an ongoing basis, as a result of which one Decision No. WOŚ.II.7222.1.4.2020.MG amending the integrated permit was issued in 2020 (on September 29th 2020). The amendments related to: • Installation of an emergency ventilation system for ammonia vapour removal, thus creating three new organised emission emitters at the PN3 fertilizer production unit; • Management of generated waste with the following codes: − 06 11 99 (wastes not elsewhere specified) – enabling neutralisation, at the Company’s wastewater treatment plant, of slurry containing TiO2, SiO2, H2SO4 produced at the titanium white production unit; − 19 09 06 (solutions and sludge from regeneration of ion exchangers) – increasing the weight of waste produced in the water preparation unit from 1,800,000 Mg/pa to 2,700,000 Mg/pa; • Adaptation of the wastewater treatment plant to the requirements of Commission Implementing Decision (EU) 2016/902 of 30 May 2016 establishing best available techniques (BAT) conclusions for common waste water and waste gas treatment/management systems in the chemical sector – determination of the scope and frequency of testing treated wastewater toxicity; • Adaptation of the EC II CHP Plant units to the best available techniques (BAT) conclusions for large combustion plants, in particular in terms of the scope and frequency of mercury emission monitoring.

Another request for amendment to the integrated permit was submitted to the Marshal Office on December 4th 2020. The relevant administrative decision was issued on January 15th 2021, under which the Company secured a 16th amendment to the integrated permit concerning: • Specification of the urea solutions unit and change of the location of the measuring point for the E6-10 emitter; • The Company’s investment project to install a new salinity reduction unit as part of the demineralised water production process.

Reporting period: 2020

Have there been any changes to Yes [X] If Yes, please describe: environment, social, labour or health No [ ] and safety laws or regulations that Environmental protection area: have materially affected the Regulation of the Minister of Climate of Company? September 11th 2020 (Dz.U.2020.1752), effective from January 1st 2021, amending specific requirements for waste storage sites. The Company has one to four years to bring its waste storage sites in line with the new requirements. Social policy, labour, health and safety area: Act of March 2nd 2020 on Special Measures to Prevent, Counteract and Combat COVID-19, Other Infectious Diseases and Crisis Situations Caused by Them, as amended (Dz.U. 2020.1842). Amendment to the Act of December 5th 2008 on the Prevention and Combating of Infections and Communicable Diseases in Humans (Dz.U.2020.1845). Regulation of the Minister of Health of March 20th 2020 on the declaration of the state of epidemic in the Republic of Poland (Dz.U.2020.491). Regulation of the Council of Ministers on the introduction of certain restrictions, orders and prohibitions due to the state of epidemic – the regulation is being updated on an ongoing basis.

How many inspections did you Number: 2 Please provide details of these visits, receive from the environmental Szczecin including number and nature of any violations authorities during the reporting Provincial found: period? Inspectorate In 2020, two inspections were carried out by for the Szczecin Provincial Inspectorate for Environmental Environmental Protection (WIOŚ). Protection The first inspection by the WIOŚ of Szczecin (WIOŚ) was carried out from February 4th to March 18th 2020 and concerned compliance with the environmental regulations governing release of gases and particulate matter into the air. In the course of the inspection, measurements were performed at three spray dryers of the titanium dioxide production facility. The inspection did not reveal any exceedance of the limits established for concentrations of particulate matter emitted from the spray dryers, as specified in the integrated permit. No other non-compliances were identified in the course of the inspection and no follow-up recommendations were issued. The inspection enabled the WIOŚ of Szczecin to close the administrative proceedings launched in November 2017 concerning non- compliance with the emission standards for the GP dryer unit, and to issue Decision No. 19/2020 of June 15th 2020. Pursuant to the decision, the entire amount of the fine (PLN 46,215) was offset against amounts spent on investment projects aimed at reducing particulate matter emissions to permitted levels, as requested by the Company. The second inspection was carried out by WIOŚ from July 15th to August 14th 2020 and concerned compliance with the applicable environmental protection requirements prior to the issuance of a permit for waste generation and a permit for waste collection and processing, in the context of the administrative proceedings conducted by the Marshal of the Szczecin Province to amend the integrated permit. The inspection did not identify any non-compliances, allowing the Marshal of the Szczecin Province to issue a decision amending the integrated permit on September 29th 2020.

How many inspections did you Number: Please provide details of these visits, receive from the health and safety including number and nature of any violations National authorities during the reporting found: Sanitary period? Following a joint inspection by the Provincial Inspectorate Command and County Command of the State (PIS) – 0 Fire Service carried out from June 15th to State Fire June 30th 2020 to check compliance with the Service (PSP) – 3 fire safety regulations and with the safety requirements applicable to upper-tier establishments, an administrative decision was issued by the Provincial Command of the State Fire Service on September 15th 2020, Ref. No. WZ.5586.5.3.4.2020, ordering removal of 2 non-compliances. Both non- compliances were removed within the prescribed time limits. Following an inspection carried out on June 22nd–June 26th 2020 to gather information necessary to analyse a major industrial accident, formulate recommendations for the operator of the plant, and check whether the operator had taken all preventive measures and satisfied the safety requirements applicable to upper-tier establishments, an administrative decision was issued by the Provincial Command of the State Fire Service on September 28th 2020, Ref. No. WZ.5586.5.4.5.2020, ordering the removal of 5 non-compliances. 4 non-compliances were removed, and the deadline for removal of the last one was set for December 31st 2021. How many inspections did you Number: Please provide details of these visits, receive from the labour authorities including number and nature of any violations National Labour during the reporting period? found: Inspectorate – 1 Administrative instruction No. 140242-53- K012-Nk01/20 of June 30th 2020 9 prescriptions 7 points have been implemented 2 points have not reached their deadline yet Improvement notice No. 140242-53-K012- Ws01/20 of June 30th 2020 3 prescriptions have been implemented

Have these visits resulted in any Yes [ ] If Yes, please describe, including status of penalties, fines and/or corrective No [X] implementing corrective actions to address action plans? any violations found: Environmental protection area: On July 29th 2019, the Company received Decision by the Provincial Inspectorate for Environmental Protection No. 31/2019 imposing a fine of PLN 46,215.0 for failure to meet the standards for particulate matter emissions from spray dryer units of the titanium dioxide production plant in the period from March to June 2016. By a letter to the Provincial Inspectorate for Environmental Protection dated August 13th 2009, the Company requested that the fine payment be deferred and that the costs incurred to implement projects designed to remove the reasons for imposing it be fully offset against the fine amount. In response to the request, the Provincial Inspectorate for Environmental Protection of Szczecin, by a letter of September 10th 2019, notified the Company of the expected date of closing the case (December 30th 2019). On June 15th 2020, the Company received a decision of the WIOŚ Inspector concerning: − Discontinuation of the proceedings to defer payment of a fine of PLN 42,215, imposed by the Szczecin Provincial Inspector for Environmental Protection for exceeding the permitted particulate matter emissions from emitters in 2016. − Reduction of the PLN 42,215 fine specified in Decision 31/2019 by a total amount of the Company’s own funds (PLN 42,215) spent on a project designed to reduce total particulate matter emissions from the spray dryer emitters. OHS area: No penalties were imposed.

Has the Company engaged any Yes[x] If Yes, please state for which types of work, contractors for project-related work No [ ] and how the Company has monitored the in the reporting period? compliance of contractors with EBRD Performance Requirements and the Environmental and Social Action Plan: Contractors were engaged, inter alia, for: • Taking samples and measuring concentrations of soluble forms of heavy metals: zinc, lead, nickel, chromium and antimony in water from the piezometers of the monitoring network of the iron sulfate landfill site. The contractor holds accreditation No. AB 283 from the Polish Centre for Accreditation. • Taking geodetic measurements of the landfill sites. The contractor holds the relevant professional licences and certifications required to carry out the work Yes [ ] If Yes, please provide details, including how Were any of the violations stated No [X] the Company is ensuring that corrective above the responsibility of actions are implemented by the contractor? contractors?

Have any operations been reduced, Yes [ ] If Yes, please describe: temporarily suspended or closed No [X] down due to environmental, health, safety or labour reasons?

Please describe any environment or social programmes, initiatives or sub-projects undertaken during the reporting period to improve the Company's environmental or social performance and/or management systems: OHS area: 1. Health and safety at work improvement measures have been set out in the ‘Working conditions improvement plan 2020’, and included, among other things, refurbishment of offices and staff amenities, purchase of additional office equipment, and improvement of the technical condition of, and provision of access routes to, machinery and equipment. 37 projects were executed, at a total cost of PLN 3,706.4 thousand. The plan resulted in improved working conditions for 676 employees. 2. In recognition of its dedication to ensuring safety, the Company has received awards, including: Gold Card of Safe Work Leader (Złota Karta Lidera Bezpiecznej Pracy) 3. In 2020, the Company continued to operate programmes aimed at improving safety at work, including: • Regular safety briefings with rank-and-file staff, based on ‘5 minutes for safety’ instruction materials developed by the OHS and Accident Prevention Office, • ‘Protect Your Eyes’ campaign, • Quarterly safety meetings held to engage management in OHS matters. 4. Under the BSC programme, the Company also monitors and updates its occupational and environmental safety indicators.

In 2020, during an audit of the Integrated Management System, the OHS system was subject to recertification with simultaneous transfer to the new ISO 45001:2018 standard.

Environmental protection area: In order to improve Grupa Azoty Zakłady Chemiczne Police S.A.’s environmental or social performance and/or management systems, the following investment projects were carried out in 2020: ➢ Alteration of the phosphate rock storage facility (fc. 200) (project budget: PLN 8,350 thousand; 2020 expenditure: PLN 10,409 thousand). The project was completed in 2020. ➢ Replacement of WAII absorption tower at Line 7 of the Sulfuric Acid Department (project budget: PLN 16,350 thousand; 2020 expenditure: PLN 2,056 thousand). ➢ Renovation of flooring and installation of a sewerage system on level 0 at fc. 517 (project budget: PLN 1,400 thousand; 2020 expenditure: PLN 156 thousand). The project was completed in 2020. ➢ Facility 508 tray with a sedimentation tank and an acidic wastewater drain (project budget: PLN 11,050 thousand; 2020 expenditure: PLN 9,494 thousand). ➢ Making production of demineralised water independent of variable salinity of the Oder River and increasing the capacity to produce special waters in water preparation units (project budget: PLN 108,000 thousand; 2020 expenditure: PLN 59,122 thousand). ➢ Upgrade of staff amenities at facility 405C (project budget: PLN 420 thousand; 2020 expenditure: PLN 363 thousand). The project was completed in 2020. ➢ Renovation of M-BAG warehouse facilities, roads and yards (project budget: PLN 5,950 thousand; 2020 expenditure: PLN 3,226 thousand). ➢ Protection of 14F583 and 15F583 pressure oil tanks against a pressure increase in lubricating and sealing oil systems of synthesis gas compressors and turbines (project budget: PLN 98 thousand; 2020 expenditure: PLN 58 thousand).

In 2020, the total amount of capital expenditure on the above environmental protection projects was PLN 86,881 thousand.

A copy of the Environmental and Social Action Plan is attached as Appendix 1 to this Report.

4. Environmental Monitoring Data for each of the key subsidiaries The information required in this section can be extracted from a CSR report, or a full CSR report can be attached.

Please provide the name and contact details for Magdalena Rabe your environmental manager: [email protected] Parameter2 Amount3 Unit Compliance Status4 Comments5 Wastewater Treated industrial compliant with the integrated 30,657,874.00 m3/year wastewater permit Treated municipal compliant with the integrated 1,396,421.00 m3/year wastewater permit compliant with the integrated Total wastewater 32,054,295.00 m3/year permit Spent cooling water compliant with the integrated 110,669,343.00 m3/year and stormwater permit

Biochemical Oxygen 19.82 Mg/year compliant Demand (BOD5)

Chemical Oxygen compliant with the integrated 697.72 Mg/year Demand (COD) permit compliant with the integrated Suspended solids 399.76 Mg/year permit

compliant with the integrated Ammoniacal 110.60 Mg/year permit nitrogen compliant with the integrated Total phosphorus 7.22 Mg/year permit compliant with the integrated Total iron 19.38 Mg/year permit compliant with the integrated Fluorides 468.42 Mg/year permit compliant with the integrated Titanium 0.22 Mg/year permit compliant with the integrated Total nitrogen 212.56 Mg/year permit Air Per each major Mg emissions point source

compliant with the integrated ammonia production 2.66 permit titanium white compliant with the integrated 94.48 production permit mineral fertilizers compliant with the integrated 1.39 SO2 production permit sulfuric acid compliant with the integrated 1,498.19 production permit fuel combustion compliant with the integrated (capacity above 50 175.50 permit MW) compliant with the integrated ammonia production 163.20 permit titanium white compliant with the integrated 3.11 production (Fespol) permit mineral fertilizers compliant with the integrated Nitrogen oxides 14.62 production permit (NO ) X sulfuric acid compliant with the integrated 94.07 production permit fuel combustion compliant with the integrated (capacity above 50 541.20 permit MW) titanium white compliant with the integrated 42.68 production permit phosphoric acid compliant with the integrated 33.76 production permit mineral fertilizers compliant with the integrated 148.46 PM production permit compliant with the integrated urea production 82.08 permit fuel combustion compliant with the integrated (capacity above 50 18.24 permit MW) ammonia production 674,621 unit urea production unit 13,770 titanium white 27,627.95 production unit mineral fertilizers 38,461.99 production unit

CO2 sulfuric acid 2,371.32 production unit

dried iron sulfate 2,233.30 production unit EC I (CHP Plant I) 0 EC II (CHP Plant II) 671,622.25 Other parameters Noise emissions According to 2019 meter readings, noise emissions are within permitted levels and comply with the integrated permit. Frequency of measurements (once every two years). Noise measurements will be repeated in 2021. [Other] Solid waste Please provide details of the types and amounts of solid wastes generated by the project. Indicate where wastes are classified as hazardous. Indicate the final re-use, recycle or disposal method for each waste type. * emission loads determined based on continuous pollutant emissions monitoring. ** emission loads determined in relation to TNP.

Information on waste generated in 2020 Solid waste generated by Grupa Azoty POLICE Ite Weight of waste Waste code Waste type m generated [Mg] Solid salts and solutions other than those mentioned in 06 1. 06 03 14 2.105 03 11 and 06 03 13 Sludges from onsite effluent treatment other than those 2. 06 05 03 360,940.0 mentioned in 06 05 02 Phosphogypsum mixed with slag, bottom ash and boiler 3. 06 09 81 1,877,637.998 dust (excluding boiler dust mentioned in 10 01 04) 4. 06 11 83 Waste iron sulfate 123,259.560 5. 07 02 99 Wastes not otherwise specified 5.820 6. 15 01 01 Paper and cardboard packaging 12.600 7. 15 01 02 Plastic packaging 130.916 8. 15 01 03 Wooden packaging 488.422 Packaging containing residues of or contaminated by 9. 15 01 10* dangerous substances (i.e. Toxicity Class I: very toxic and 7.196 Class II: toxic crop protection chemicals) Discarded equipment containing hazardous components(5) 10. 16 02 13* 0.270 other than those mentioned in 16 02 09 to 16 02 12 Discarded equipment other than that mentioned in 16 02 09 11. 16 02 14 5.820 to 16 02 13 Components removed from discarded equipment other than 12. 16 02 16 11.619 those mentioned in 16 02 15 13. 16 06 01* Lead batteries 0.305 14. 17 01 01 Concrete waste and rubble from demolition and repair 201.440 Mixture of concrete, bricks, tiles and ceramics other than 15. 17 01 07 21.320 those mentioned in 17 01 06 16. 17 04 02 Aluminium 14.020 17. 17 04 03 Lead 0.360 18. 17 04 05 Iron and steel 1,483.804 19. 17 04 11 Cables other than those mentioned in 17 04 10 8.241 20. 19 09 02 Sludges from water clarification 1,091.020 21. 19 12 05 Glass 0.010

Solid waste (generated) managed as part of recovery process at Grupa Azoty POLICE Recovery Ite /disposal Waste code Waste type Weight [Mg] m operatio n Solid salts and solutions other than those mentioned in 06 1. 06 03 14 2.105 R5 03 11 and 06 03 13 Sludges from onsite effluent treatment other than those 2. 06 05 03 360,940.0 R5 mentioned in 06 05 02 3. 06 11 83 Waste iron sulfate 806.0 R5 4. 19 09 02 Sludges from water clarification 1,091.020 R5 Solid waste (generated) managed as part of disposal process at Grupa Azoty POLICE Recovery No /disposal Waste code Waste type Weight [Mg] . operatio n Phosphogypsum mixed with slag, bottom ash and boiler 1. 06 09 81 1,877,637.998 D5 dust (excluding boiler dust mentioned in 10 01 04) 2. 06 11 83 Waste iron sulfate - 13,969,211 D5 3. 17 01 01 Concrete waste and rubble from demolition and repair 201.440 D5 Mixture of concrete, bricks, tiles and ceramics other than 4. 17 01 07 21.320 D5 those mentioned in 17 01 06 Solid waste (generated) transferred to external operators for recovery (R) or disposal (D) Recovery No Waste code Waste type Weight [Mg] /disposal . operatio 11

n 1. 06 11 83 Waste iron sulfate 116,923.380 R 2. 07 02 99 Wastes not otherwise specified 16.160 R 3. 15 01 01 Paper and cardboard packaging 12.600 R 4. 15 01 02 Plastic packaging 130.916 R 449.920 R Handed 5. 15 01 03 Wooden packaging over to 32.395 natural persons Packaging containing residues of or contaminated by 6. 15 01 10* dangerous substances (i.e. Toxicity Class I: very toxic and 7.196 R Class II: toxic crop protection chemicals) Discarded equipment containing hazardous components(5) 7. 16 02 13* 0.270 D other than those mentioned in 16 02 09 to 16 02 12 Discarded equipment other than that mentioned in 16 02 09 8. 16 02 14 5.820 R to 16 02 13 Components removed from discarded equipment other than 9. 16 02 16 21.440 R those mentioned in 16 02 15 10. 17 04 02 Aluminium 14.840 R 11. 17 04 03 Lead 0.360 R 1,537.398 R Handed 12. 17 04 05 Iron and steel over to 0.080 natural persons 13. 17 04 11 Cables other than those mentioned in 17 04 10 8.240 R 14. 19 12 05 Glass 0.010 R Solid waste collected from external operators for management as part of recovery or disposal processes at Grupa Azoty POLICE Recovery No /disposal Waste code Waste type Weight [Mg] . operatio n Bottom ash, slag and boiler dust (excluding boiler dust 1. 10 01 01 61.500 R5 mentioned in 10 01 04) 2. 12 01 01 Ferrous metal filings and turnings 2,824.294 R4 310.340 R5 3. 17 01 01 Concrete waste and rubble from demolition and repair 136.120 D5 4. 17 01 02 5.840 D5 Mixture of concrete, bricks, tiles and ceramics other than R5 5. 17 01 07 118.060 39.240 those mentioned in 17 01 06 D5 6. 17 02 02 Glass 25.880 D5 7. 17 04 05 Iron and steel 716.526 R4 1,900.440 R5 8. 17 05 04 Soil and stones other than those mentioned in 17 05 03 5.900 D5 Insulation materials other than those mentioned in 17 06 01 9. 17 06 04 71.160 D5 and 17 06 03 * -hazardous waste

5. Resource Usage and Product Output Measurement Parameter Amount Comments Unit Fuels used Crude oil Not applicable - Natural gas 5,745,458.78 MWh Hard coal 291,489.97 Mg Lignite Not applicable - Grid electricity 316,766.66 MWh Heat purchased from external 441,072.00 GJ sources Used feedstocks and raw materials

Phosphate rock 836,486.83 Mg Sulfur 209,459.88 Mg Sulfuric acid from 289,014.36 Mg external sources Ilmenite 83,422.89 Mg Slag 2,763.20 Mg Potassium chloride 353,008.65 Mg Potassium sulfate 1,669.37 Mg Ammonium sulfate from external Mg 38,968.19 sources Magnesite 33,267.57 Mg Product output NPK fertilizers 831,512.61 Mg Contains 969 Mg of PK 10-25 fertilizer NP fertilizers 182,880.81 Mg NS fertilizers 17,077.70 Mg Sulfuric acid 634,600.00 Mg Phosphoric acid 324,458.44 Mg Ammonia 523,667.20 Mg Urea 375,231.20 Mg NoxyTM(AdBlue) 204,877.54 Mg Titanium white 33,183.69 Mg

6. Human Resources management Please provide the name and contact details for Agata Sobocińska your Human Resources manager: [email protected] Recruited in this Terminated in this Total reporting period reporting period Number of direct employees: 2,526 146 180 Number of contracted workers: 0 0 0 Were there any collective Yes [ ] If Yes, please describe the redundancy plan, redundancies during the reporting No [X] including reasons for redundancies, number of period? workers involved, how they were selected, consultation undertaken, and measures to mitigate the effects of redundancy: Are any redundancies to the Yes [ ] If Yes, please describe the redundancy plan, workforce planned for the next No [X] including reasons for redundancies, number of year? workers involved, and selection and consultation process: Were there any changes in trade Yes [ ] If Yes, please provide details, and summarise union representation at Company No [X] engagement with trade unions during reporting plants during the reporting period: period? Were there any other worker Yes [ ] If Yes, please provide details and summarise representatives (e.g. in the No [X] engagement with them during the reporting period: absence of a trade union)? Were there any changes in the Yes [ ] If Yes, please provide details: status of Collective Agreements? No [X]

Have employees raised any Yes [ ] If Yes, please state how many, split by gender, complaints about harassment or No [X] summarise the issues raised by male and female bullying during the reporting staff and explain how the Company has addressed period? them:

Have there been any strikes or Yes [ ] If Yes, please summarise nature of, and reasons for, other collective disputes related No [X] disputes and explain how they were resolved: to labour and working conditions at the Company in the reporting period? Have there been any court cases Yes [x] If Yes, please summarise the issues contested related to labour issues during the No [ ] and outcome: reporting period? In a majority of closed cases, the claims were dismissed. Have there been any changes to Yes [x] If Yes, please give details, including of any new the following policies or terms No [ ] initiatives: and conditions during the 1. During the reporting period, an agreement was reporting period in any of the concluded with the trade unions on: following areas: a) increase in pay grade rates, − Trade union recognition b) increase in allowances payable to chemical − Collective Agreements rescuers and technical rescuers, − Non-discrimination and equal c) increase in other allowances specified in the opportunities for all Collective Bargaining Agreement, − Equal pay for equal work d) increase in the amounts credited to prepaid − Gender equality cards from the Company Social Benefits Fund − Bullying and harassment, in 2020. including sexual harassment − Employment of young 2. Reduction of working time for staff working in workers under 18 the basic two-shift work system (3 crews) and in the basic three-shift work system (5 crews) − Wages and salaries (for regular and overtime hours) based on an agreement reached with the trade unions in 2019. − Overtime − Working hours − Flexible working / work-life balance − Grievance mechanism for workers − Health & safety

7. Occupational Health and Safety Data Please provide the name and Barbara Hryniewicka contact details for your Health [email protected] and Safety manager: Direct Contracted Direct Contracted employees workers employees workers

Number of man- hours worked in Number of 3,743,424 0 0 0 this reporting fatalities 7: period: Budget spent on Number of OHS in this period PLN 3,706,414 0 disabling 0 0 (total amount and injuries: currency): OHS training Number of Lost provided in this Time Incidents 1,986 0 35 0 period in person- (including days: vehicular): Number of lost 2 Number of cases workdays (Retirees not 1,374 0 of occupational 0 resulting from working at the disease: incidents: Company) Number of sick 51,183 days: Accident causes (falling, heavy loads, struck by object, contact with energy source etc.): 57% of accidents were related to moving around the Company’s premises, including its facilities. The other accidents involved: 23% – mechanical hazards 14% – contact with process media and hot steam 6% – other hazards Please provide details of any fatalities or major accidents that have not previously been reported to EBRD, including total compensation paid due to occupational injury or illness (amount and currency): not applicable Please summarise any emergency prevention and response training that has been provided for Company personnel during the reporting period: OHS area: The Company provides scheduled OHS and fire prevention training to employees in line with the following approved training programmes: • General induction training – new employees. • Position-specific training • Periodic and supplementary training. The training includes existing risks related to chemicals used, emergency procedures and crisis response. Fire safety area: • Fire safety training was provided in the form of self-study courses based on teaching materials prepared by the Company Fire Brigade.

Please summarise any emergency response exercises or drills that have been carried out during the reporting period: • 14 on-site drills (comprising chemical and technical rescue, firefighting, and water rescue operations) were arranged and carried out, of which 10 were organised as application drills and 4 water rescue drills were carried out on site solely with the participation the Company Fire Brigade shift team. • On-site examination of the conditions for evacuation from the facilities was carried out, on September 21st 2020 for facility 512 and on September 23rd 2020 for facility S-6. • On February 24th 2020, the Company Fire Brigade participated in evacuation drills on the premises of GA Polyolefins.

8. Stakeholder Engagement Please provide the name and contact details Paweł Piwowarczyk for your external relations or community [email protected] engagement manager: Kornelia Przygoda [email protected] Please provide information on the implementation of the Stakeholder Engagement Plan agreed with EBRD and summarise interaction with stakeholders during the reporting period, including: − meetings or other initiatives to engage with members of the public or public organisations during the reporting period − information on environmental protection, social policy and safety matters provided to the local community and other stakeholders during the reporting period: − coverage in the media: − interaction with any environmental or other community groups. Please describe any changes to the Stakeholder Engagement Plan agreed with EBRD: Grupa Azoty Police stays in touch with the local community and keeps it informed about its operations and affairs. The Company communicated with its stakeholders through: ➢ Press articles published in the Tygodnik Policki weekly. The published materials contain information about important events/investments/projects as well as promotional activities undertaken by the Company. ➢ Ongoing cooperation with the TV Police channel, which includes production of a TV programme called ‘News from Grupa Azoty Zakłady Chemiczne Police S.A.’, broadcast every two weeks. Programmes about the Company, including current and archival productions, are available at www.tvpolice.pl. ➢ Wieści Polickie (News from Police) and Police i okolice (Police and its surroundings) websites, where video footage and press releases are posted covering important events for the Company. ➢ Press conferences during which Company representatives communicate the most important information concerning Grupa Azoty Police. ➢ Company radio, which broadcasts the most important information and announcements concerning the Grupa Azoty Group and Grupa Azoty Police. ➢ Intranet, i.e. the Company’s internal computer network through which its communicates with the employees. Apart from current announcements, a range of other information is also available over the Intranet, including the Company’s Articles of Association, regulations and other by-laws, the book of processes and procedures, etc. ➢ Facebook – the Company uses the tool to communicate with its employees, the local community, as well as other people who follow the Company’s activities, including customers. On Facebook, the Company posts notices and photo galleries of various events. How many complaints or grievances did the project receive from members of the public or civil society organisations during the reporting period? Please split by stakeholder group. Summarise any issues raised in the complaints or grievances and explain how they were resolved:

• No complaints were received by the Communication and Investor Relations Office.

9. Community Development

Please summarise any social or community development / investment initiatives undertaken by the Company during the reporting period, and any associated expenditure:

One element of the Company’s strategy is to support the development of local communities. These efforts are undertaken in line with the plan of social and sponsorship activities, which covers promotion and advertising agreements and donations. Partnerships are established with local and regional clubs, associations and foundations. Support is also offered to private individuals. The Company builds its community friendly image by supporting various initiatives, including: • professional and amateur sports, • cultural initiatives, including mass cultural events, • educational institutions for children and youth, • research programmes, • regional environmental initiatives, • social campaigns. Image-building activities with a countrywide and international reach, which boost the perception of the entire Grupa Azoty Group, are carried out by the Group’s corporate department in Tarnów.

Due to the pandemic emergency declared in 2020, some of those activities could not be carried out given the bans and restrictions imposed by Polish authorities.

PROFESSIONAL SPORTS The sports teams with whom Grupa Azoty Police cooperated in 2020 included Pogoń Szczecin, a premiership football team (until the end of June 2020), and the Chemik Police Volleyball Club, whose players won all domestic trophies in the 2019/2020 season. The Company also continued its cooperation with Marcin Lewandowski, a multiple European indoor champion and the 2019 World Championship bronze medal winner in the 1,500-metre run, who qualified for the Tokyo Olympic Games.

CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES Grupa Azoty Police once again became the Main Partner of the West Pomeranian Fencing Association, which in 2020 organised the Polish Senior Cup in épée fencing, the Northern Poland Cup for children and youth in foil and épée fencing. To meet the local community’s expectations, the Company also supported local amateur clubs. In October 2020, the Company signed another agreement with the Chemik Police Football Club, which plays in the third league. The club also runs the Youth Football Academy, where it trains the youngest residents of Police, often children of Grupa Azoty Police employees. The Academy joined the elite football academies certified by the Polish Football Association, receiving the brown certificate. Support was also provided to ‘Champion’ Students’ Sports Club whose members are table tennis players of various ages;

In 2020, Grupa Azoty Police was a partner for a number of sports events, including the ‘Wild Weekend’ extreme running event and the ‘Bieg Mikołajka’ run.

Activities promoting national traditions and patriotic attitudes An important component of social and sponsorship activities is the support of initiatives cultivating and fostering Polish traditions and national identity and strengthening national, civic and cultural awareness. Therefore, in 2020 the Company continued its cooperation with the Foundation for Polish Values, including through the ‘Package for the Compatriot and Hero Living in the Eastern Borderlands’ campaign, aiming to donate Easter and Christmas gifts for Poles and their families living east of Poland. Health promotion initiatives The Polish Association of Voluntary Blood Donors – the Henri Dunant Voluntary Blood Donors Club of Police, supported by Grupa Azoty Police, is active in the Police County, promoting the idea of voluntary blood donation. In 2020, 175 volunteers donated almost 80 litres of blood during six blood donation drives hosted on the Company’s premises. Since 2018, the Association has again operated under the Company’s patronage.

Initiatives for education of children and the youth Grupa Azoty Police is consistently pursuing its efforts to develop professional and occupational education. Cooperation with secondary schools facilitates education of future employees with skills and knowledge needed in the chemical sector. The Company has under its auspices the chemical engineering class at the Ignacy Łukasiewicz School Complex in Police. Its students are given the opportunity to complete work placements and apply for scholarships. Grupa Azoty Police has also partnered with a number of schools in Szczecin, including the Electricity and Electronics School Complex, the Władysław Orkan School Complex No. 2 and the Home Army School Complex No. 4. Students of chemical engineering classes, like their peers from the Police-based school complex, can complete work placements and receive scholarships. Partnership with tertiary education institutions In September 2020, Grupa Azoty Police, Grupa Azoty Polyolefins, Grupa Azoty Police Serwis and the Maritime University of Szczecin signed a cooperation agreement. This is another example of efforts to strengthen ties between science and business. The agreement is an outcome of projects executed by the parties, including first of all creating a joint course of study, educating engineering and technical staff, and implementing scientific and research projects. Industrial engineering and offshore wind power plants, the curriculum of which is drawn up in cooperation between the University teachers and Grupa Azoty experts, will be a one-of-a-kind course of study not only in the region. In addition, Grupa Azoty Police continues to work with the West Pomeranian University of Technology, including on R&D projects, implementation-based doctoral programmes, educating technical staff, and organising work placements for students of Chemical and Process Engineering and the Faculty of Mechanical Engineering and Mechatronics. In January 2021, Grupa Azoty Police and the University of Szczecin signed an agreement on research and educational cooperation. The Company is interested in attracting not only highly-qualified technicians and engineers, but also specialists in management, accounting or law, i.e. the fields of study offered by the University. The Company positively responded to students’ needs by providing them with selected information which was used in a number of dissertations. The Company arranges internships and work placements which attract students from the region. Examples include ‘Green Forge’, the HR Department’s proprietary project implemented as part of the Employee Engagement Enhancement Programme, designed to offer free work experience for students and paid internships for graduates. The cooperation with the West Pomeranian Business School and the WSB University allows employees to pay lower tuition fees.

Social campaigns Grupa Azoty Police commenced cooperation with the ‘Useful Ones’ Social Cooperative, which supports individuals with disabilities. The cooperative, being a part the Polish Association For Persons with Intellectual Disability, Police Branch, runs two restaurants in which disabled persons can pursue their interests, raise their qualifications and integrate with others.

Donation policy

Giving donations is part of the adopted social and sponsorship activities plan. The purposes for which donations may be given are defined in detail in the Donation Rules. Initiatives in this area are usually connected with the promotion of sports and healthy lifestyle, social welfare, holidays for children and youths, arts and culture, as well as religious worship. The initiatives undertaken by the Company in 2020 included: • extension of the playground for children at the Salesian Children’s Home in Szczecin; • support for the Passion of Christ Mystery play; • support for the Honorary Blood Donors Club in Police; • support for the ‘Ostoja’ Teetotal Association; • support for the organisation of an anniversary event and production of decorations commemorating the 50th anniversary of the December 1970 strikes and bloodshed in Szczecin; • support for the activities of the Polish Association For Persons with Intellectual Disability, 19 Police Branch.

In view of the coronavirus pandemic unfolding in Poland in 2020, the Company decided to allocate over PLN 1m to support the fight against COVID-19. The Company donated funds to: − The Provincial Sanitary and Epidemiological Station in Szczecin; − The Regional Hospital in Kołobrzeg; − The Professor Tadeusz Sokołowski Independent Public Clinical Hospital No. 1 of the Pomeranian Medical University in Szczecin; − The Pomeranian Medical University in Szczecin (February 2021).

Furthermore, funds were donated to the Foundation for Polish Values to help prevent the spread of COVID-19 among Polish communities in Lithuania and to buy equipment for school day care centres.

The Company also provided hygiene products and personal protective equipment to: − The St. Borromeo Rehabilitation Hospital in Szczecin; − The County Headquarters of the State Fire Service in Police; − The Szczecin Provincial Emergency Medical Service Station.

Donations are granted mainly to applicants from the Province of Szczecin and, in justified cases, also from other regions. Each application is examined on a case-by-case basis.

In 2020, total spending on social initiatives amounted to: PLN 12,951,010.71

ENVIRONMENTAL AND SOCIAL ACTION PLAN

GRUPA AZOTY ZAKŁADY CHEMICZNE POLICE S.A.

5. Actions required to maintain compliance with EHS requirements of national law and EU environmental standards − GRUPA AZOTY ZAKŁADY CHEMICZNE POLICE S.A.

No. Action Environmental risks, Legislative Requireme Scheduled Target and Comments liabilities/benefits requirements/ nt/Resourc completion – evaluation Best practice es action to be criteria for completed by implementation end of year progress 5.1 Complete the planned Reduce negative environmental impact Legislative Investment 2018 Obtain a relevant Provide update modernisation of energy in line with IED requirements. requirement needs permit for the in the 2017 generation installations to s, best new facilities annual report. ensure compliance with Asses further methods of reducing managemen Annex V to IED. energy intensity and carbon emissions t practices, Update from energy installations as part of the Bank's PRs information on Target emission levels: project and future BAT assessment. the project in the 3 200 mg/m for SO2 annual report, 200 mg/m3 for NOx selected 20 mg/m3 for PM. technology and target emission levels.

Publish NTS of the project and provide copy/web link to the Bank as part of the annual report.

In May 2018, a flue gas treatment system built to ensure compliance of the EC II CHP plant with the requirements of the Industrial Emissions Directive was commissioned for regular operation. The flue gas treatment system is now in operation, and the NOx, SO2 and PM concentrations do not exceed the limits set down in the IED. Capex on the flue gas treatment project amounted to PLN 252,005 thousand.

5.2 Monitor environmental Reduce negative environmental impact Legislative Internal Ongoing Summary of the impacts of landfill sites and of landfill sites. Develop long-term requirements, resources action plan in the continue planned technical action to further monitor and reduce best and annual report development. impact of the landfill site as part of management investment BAT assessment in 2015. practices, s Bank's PRs Information: The environmental impact of landfill sites (Section 5.2) was monitored in accordance with: Decision by the Marshal of the Szczecin Province approving the iron sulfate landfill operation manual (Ref. No. WOŚ.II.7241.62.2.2013.BK, dated January 9th 2014 and Ref. No. WOŚ.II.7241.3.4.2020.AM dated December 10th 2020), and Decision by the Marshal of the Szczecin Province approving the phosphogypsum landfill operation manual (Ref. No. WOŚ.II.7241.3.1.2019.AM, dated August 14th 2019).

5.3 Complete modernisation of Reduce negative environmental impact Legislative Internal Completed on Summary in the heating oil storage depot – of the HFO (heavy fuel oil) storage requirements, funds August 29th 2014 annual report execution stage areas. HFO storage must be best modernised. management practices, Bank's PRs Information: The following work was completed: installation of oil-tight bunds for F3 and F4 storage tanks (light fuel oil), installation of oil-tight bunds for F5 and F6 storage tanks (heavy fuel oil), construction of stormwater drainage system, installation of I&C system for measuring oil levels in the tanks, as well as testing of tank truck earthing continuity during oil unloading. The project was completed. Expenditure incurred: PLN 1,355,850

5.4 Prepare a plan (including Reduce negative environmental impact Legislative Internal 2015 Report on soil and budget) and conduct soil in line with IED requirements, resources groundwater and groundwater best and condition assessment. management external practices, support Bank's PRs

Information: The Company regularly assesses the risk of soil, ground and groundwater contamination with hazardous substances from the Company's units and installations (in compliance with the integrated permit granted by Decision of the Marshal of the Szczecin Province Ref. No. WOŚ.II.7222.13.9.2013.MG, as amended, dated January 9th 2014). The assessment takes into account actions, procedures and measures taken to prevent contaminants from entering the ground. The ‘Assessment of the risk of soil, ground and groundwater contamination’ is performed in line with Scheme No. SP-O-P06-01, using dedicated software. The related monitoring covers procedures aimed at removing the consequences of incidents and preventive measures taken to minimise the risk of occurrence of similar incidents in the future.