3 Raute Corporation's Non-Financial Statement

RAUTE CORPORATION’S NON-FINANCIAL STATEMENT FOR 2020

3 SUSTAINABILITY, PRODUCTS AND SERVICES An increase in the use of sustainably produced wood to re- Principal risks Raute delivers technology for the wood products industry, place non-renewable materials, for example in construction, The principal risk related to Raute’s deliveries is the risk of an which uses renewable raw materials. Most of the wood prod- transportation and consumer products, is among the most im- accident during the installation and commissioning phase or ucts manufactured using Raute’s machinery have a long life, portant means of achieving climate targets. Demand for wood during production use or maintenance of the equipment and and the carbon they store, combined with the replacement products industry technology will grow as attention increas- machinery. of a non-renewable material, have a positive impact on the ingly turns to climate risks in the manufacturing and construc- achievement of climate targets. The glues and coatings used in tion industries globally. In recent years, an increasing number Goals plywood and LVL products contain oil-based ingredients, but of construction projects have chosen solutions based on the Raute’s main goals are: use of wood materials, and this trend is expected to continue. • in terms of product development, to improve the energy Solutions for manufacturing glue from wood-based raw mate- With Raute’s technology, Raute’s customers can improve the rialsthey haveaccount also for been a relatively published small in the share sector. of the final product. - and to reduce harmful environmental impacts ations and increase the availability of renewable materials for • toand prevent raw material all personal efficiency injury of within machinery Raute’s and sphere equipment, of in- useresource by different efficiency industries. and occupational safety of their own oper and during production use and maintenance. fluence during the installation and commissioning phase Raute in wood processing value chain

3 RAUTE CORPORATION’S NON-FINANCIAL STATEMENT FOR 2020

Operating principles and procedures 4 ENVIRONMENTAL MATTERS, OWN OPERATIONS Goals Raute ensures that its products and services are safe to use as The direct environmental impacts of Raute’s own operations The main goals of environmental management in Raute’s own part of the delivery implementation process. Pressure piping are minimal. Raute’s plants do not have their own power pro- operations are to: is manufactured and tested in compliance with module D1 of duction facilities, nor do the processes consume large volumes the pressure equipment directive (PED). Raute offers its cus- of water. The main environmental aspects are related to waste • reduce waste volumes in relation to net sales. tomers installation, installation supervision and commission- management in plant areas and the safe management of chem- • improve energy efficiency - icals. Even though the volumes of Raute’s energy and water Outcomes antee is granted for use in accordance with the instructions. The execution rate for measures concerning managing envi- Raute’sing services, main asunit well in asLahti user has training, a quality and management a fixed-term system guar the company monitors and strives to further increase the ef- consumption are not significant in relation to Raute’s business,- ronmental matters at the Lahti unit in 2020 was 93 per cent.- certified according to ISO 9001:2015 and an environmental ficiency of its plants’ and offices’ energy use and water con Lahti’s ISO 9001:2015 quality management system and ISO management system certified according to ISO 14001:2015. thesumption. average In electricity 2020, Raute consumed invested in in a solar day. panels for the Lahti 14001:2015 environmental management system will be recer Raute’sOther Raute product units development abide by the samesustainability key principles. targets aim to, plant. The solar power plant generates roughly 30 percent of tified in connection with an external audit performed in 2022. among other things, reduce the customer’s raw material waste Principal risks The recertification is performed every three years. and additive needs, energy consumption and emissions. Spe- Various oils, solvents and other chemicals are handled to some percent and consumption of water per person decreased 1 cial attention is given to occupational safety during the en- extent in Raute’s production plants. A chemical leak or acci- In 2020, energy consumption per hour worked decreased 6- - dent at a plant may contaminate the environment and lead to land. The carbon dioxide emissions of our own operations in ciency of material use for its own products has been a goal of relationpercent. toWaste net sales in relation grew by to 1 net percent. sales fell 12 percent in Fin productgineering development. phase of production lines. Also the increased effi production at the plant. Raute’s Lahti plant is located in a groundwaterfinancial costs, zone. harm the company’s reputation and disrupt The energy, water and carbon dioxide emission data report- - were set as product development responsibility targets for Operating principles and procedures itoring of waste and indirect (Scope 3) emissions has not yet Three projects to improve environmental efficiency or safety Raute manages the environmental risks linked to its opera- ed for 2020 cover all the company’s production plants. Mon - tions through its quality and environmental management sys- sumption2020. The and objectives increasing of digital the projects services. are related to making 5reached SOCIAL a level AND sufficient EMPLOYEE-RELATED for Group-wide MATTERS reporting. more efficient use of wood raw material, lowering energy con Skilled employees that are committed to the company’s tar- Outcomes environmentaltems. Raute’s main management unit in Lahti system. has an At ISO the 9001:2015 Lahti plant, certified risks gets are Raute’s most important resource. Competence reten- quality management system and an ISO 14001:2015 certified- and service development was 67 percent. Raute was not aware ation is assessed and monitored regularly. Large volumes of resources are particularly important in a business where eco- ofThe any execution serious work-related rate for the 2020accidents targets arising concerning from the product proper chemicalsrelated to arechemical not stored safety at have the plant, been andidentified, waste isand disposed the situ of nomiction and and development investment and cycles ensuring strongly the affect sufficiency demand. of human Raute - aims to secure a safe work environment for the company’s ciples of the environmental and quality management systems employees and contractors, in both its own business locations Accordinguse of Raute’s to customer machinery satisfaction and equipment surveys in 2020.that were carried whereappropriately. applicable. Other Raute units abide by the same key prin and during installation and commissioning work. out, customers gave Raute’s maintenance services an overall The company aims to reduce the need for air travel by making use of information technology when arranging meetings and score of 4.4 out of a possible 5.0. negotiations.

4 RAUTE CORPORATION’S NON-FINANCIAL STATEMENT FOR 2020

Principal risks pliance with the law and which is intended to promote equali- chain if the infraction is severe enough to warrant an end to The principal risks pertaining to Raute’s business operations ty, prevent discrimination and reinforce the legal rights of indi- the co-operation. relate to work-related accidents affecting employees or sub- viduals who become the target of discrimination. contractors, and to maintaining and developing employee Raute has a separate Code of Conduct for suppliers. satisfaction and commitment. Work-related accidents incur Outcomes Goals company’s reputation and ability to secure skilled workforce - Raute’s main goal is: forcosts, the make company. it difficult Weakened to manage employee deliveries satisfaction and may may affect lead the to ingRaute’s to at LTIF1least one in 2020day of improved absence from from work. the previous No fatal accidentsyear and • a higher turnover rate and weaken the company’s intellectual occurredwas 7.9 (2019: among 13.6). Raute’s There own were employees 10 (2019: 18)or subcontractorsaccidents lead compliance with Raute’s Code of Conduct concerning re- capital. - spectingRaute’s entire human supply rights. chain confirms that they operate in

Goals ourduring target Raute’s is still operations. a clear decrease We can in be the satisfied number with of accidents. the devel Operating principles and procedures Raute’s main goals are: opment of the LTIF in 2020. Despite this, work continues and Suppliers and subcontractors are required to comply with the • a low number of absences due to work-related accidents a course on occupational safety in the online learning envi- managed by means of supplier audits and monitoring. • high employee satisfaction. In 2020, 91 percent of employees had successfully completed principles defined by Raute. Risks related to supply chains are (the target is to reach an LTIF1* of <8 by 2022). were recorded during the year. Outcomes *Lost Time Injury Frequency (LTIF), i.e. the number of absences resulting from work-related ronment, RauteACADEMY. In Finland, 161 safety observations accidents lasting at least one day for every million working hours Raute was not aware of any breaches related to respect for hu- Raute has a safety supervisor and safety supervisor activities. Operating principles and procedures - Supervisory work, occupational safety and ergonomics are un- sors is to observe and develop occupational safety in their own courseman rights on values that took and placethe Code in Raute’s of Conduct supply in chainthe online in 2020. learn In- der continuous development. The continuity of operations is area.The task This of has the resulted designated in good department-specific and important observations safety supervi to ing2020, environment, 86 percent RauteACADEMY.of employees had successfully completed a ensured by monitoring the development of the age structure, develop safety and eliminate hazards and it has made it possi- implementing systematic human resources management and ble to immediately address near misses. 7 ANTI-CORRUPTION AND ANTI-BRIBERY investing in well-being at work. Work-related risks are man- Raute has zero tolerance for corruption, bribery and money aged by continuously developing occupational safety and by 6 RESPECT FOR HUMAN RIGHTS laundering. Raute does not engage in any business involving Raute supports and respects the principles of the UN’s Uni- corruption, bribery or money laundering. and training. An occupational health clinic for personnel oper- - atesdirecting in connection sufficient with resources Raute’s to Lahti acquiring production safety plant. equipment Principal risks versal Declaration of Human Rights and recognizes the funda The company is at risk of being part of a business chain that In occupational health and safety matters, local laws and the themental right rights to collective at work bargaining, as defined the by abolitionthe International of forced Laborlabor, involves corruption, bribery or money laundering without its company’s own occupational safety procedures are complied andOrganization equal opportunities (ILO), which and include treatment the freedom of employees. of association, knowledge. The realization of these risks may result in legal - Principal risks sition may suffer. earlywith, interventionespecially if themodel local and OHS analysis regulations of near-miss of the countrysituations. in It is possible that players who do not respect Raute’s princi- consequences, and the company’s reputation and financial po Everyquestion accident are insufficient. and reported Preventive near-miss measuressituation is include analyzed an ples related to human rights or the basic rights of employees and corrective measures are taken based on the analysis. Em- operate in Raute’s international supply chain. Such cases may ployee satisfaction is monitored regularly through personnel damage the company’s reputation and interrupt the supply - surveys. In Finland, Raute has an equality plan that is in com

5 RAUTE CORPORATION’S NON-FINANCIAL STATEMENT FOR 2020

Goals allows Raute employees to report suspected breaches of the 8 KEY NON-FINANCIAL FIGURES Raute’s main goal is: rules and regulations through an independent channel within • Raute and Raute’s entire supply chain operate in compli- the company (whistle-blowing). - ance with Raute’s Code of Conduct pertaining to corrup- Key non-financial figures monitored at Raute for 2020 and the tion, bribery and money laundering. Outcomes comparison year 2019 are presented in the tables on the fol lowing pages for the entire Group, unless stated otherwise. - Operating principles and procedures The risk of corruption, bribery and money laundering is con- ofIn 2020,employees no breaches had successfully related to completed corruption, a briberycourse onor moneyvalues The data presented in the key figure tables has not been veri trolled by monitoring compliance with the company’s Code of andlaundering the Code were of Conductdetected inin the company.online learning In 2020, environment, 86 percent fied by a third party. Conduct and through relevant training. The risk of fraud the RauteACADEMY. company is exposed to is managed through continuous monitoring and by developing the company’s systems and procedures. The company has an internal procedure in place that

6 RAUTE CORPORATION’S NON-FINANCIAL STATEMENT FOR 2020

Personnel and Work safety Number of personnel 2020 2019 2018 2017 2016 Pernament staff education 2020 2019 2018 2017 2016 501 Basic education 5 % 6 % North America 115 117 Vocational school 31 % 31 % 31 % Finland 518 505 482 462 4 % 5 % 5 % China 83 76 73 77 College 9 % 17 % 135 147 83 32 % 30 % 52 University of Applied Science 39 % 31 % 31 % 75 18 % 19 % 22 % Total 751 University 16 % 13 % 11 % Other countries 49 45 32 21 34 % 32 % Personnel, effective, on average 747 778 772 704661 643631 14 % 14 % Training and mentoring 2020 2019 2018 2017 2016 Proportion of female employees 755 748 Training hours 14 624 of permanent staff 2020 2019 2018 2017 2016 601 Executive management 11 % 13 % 13 % 15 925 22 227 24 577 24 050 Management 13 % 7 % 7 % Of which mentoring 2 181 4 013 4 974 6 295 19 % 14 % 17 % 17 % 16 % 16 % 8 % 5 % Employees 2 % 3 % 1 % Office 18 % Total 11 % 11 % 11 % 2 % 2 % Employment contract types 2020 2019 2018 201710 % 201610 % Work time 98 % Part time 2 % 3 % Full time 96 % 96 % 96 % 97 % Contract Work safety 4 % 4 % 4 % Permanent 96 % LTIF 2020 2019 2018 2017 2016 Temporary 4 % 7 % 8,8 96 % 95 % 93 % 92 % Raute total 7,9 13,6 Employee turnover ratio 2020 20194 % 20185 % 2017 20168 % Raute Finland - 7,8 24,6 19,1 15,5 Incoming employees 9 % 20 % 17 % 23,7 23,3 28,1 *Number of workplace injuries which lead to absen 11 % 18 % 17 % ce of at least one day / total work hours * 1000000 25 % 28 % Average employee turnover 10 % 19 % 17 % Outgoing employees 12 % 18 % LTIF≥3 2020 2019 2018 2017 2016 Permanent staff age structure 2020 2019 201819 % 201723 % 2016 5,5 18 % 20 % Raute total 4,7 7,6 16,7 Raute Finland - 5,6 16,8 14,3 14,2 27 % 25 % <30 years 20 % 19 % 19 % 18,3 22,6 26 % 26 % *Number of workplace injuries which lead to absen 31-40 years 26 % 25 % 27 % ce of at least three days / total work hours * 1000000 23 % 22 % 41-50 years 24 % 25 % 23 % 7 % 7 % 6 % 6 % 51-60 years 24 % 25 % 26 % > 60 years 5 % 7 RAUTE CORPORATION’S NON-FINANCIAL STATEMENT FOR 2020

Environment Energy* 2020 2019 2018 2017 2016 Lahti, February 12, 2021 Total energy consumption, MWh Laura Raitio Mika Mustakallio 8 238 9 145 9 368 9 055 8 832 Chair of the Board Fuels (Scope 1) 1 419 1 501 1 515 1 479 1 105 Energy consumption kWh/work hour 7,6 Electricity and district heat (Scope 2) 6 819 7 644 7 854 7 576 7 727 Emissions* 20206,5 2019 6,9 2018 7,2 2017 2016 8,0

313 Joni Bask Ari Harmaala Total emissions (Scope 1-2), tCO2e 1 828 2 371 2 475 2 006 1 953 Indirect emissions from electricity and Direct emissions (Scope 1), tCO2e 292 312 324 1 236 717 13,7 17,3 Pekka Suominen Patrick von Essen district heat(Scope 2), tCO2e 1 536 2 059 2 151 1 692 CarbonWaste, Rauteintensity Finland, tCO2e/MEUR tonnes 2020 15,9 2019 15,7 2018 2017 13,5 2016 Metal chip and scrap 366 713 Cardboad and paper 17 439 458 545 Wood waste 15 20 19 20 207 310 293 197 287 Other energy waste 30 34 51 40 24 36 Hazardous waste 47 50 53 47 52 Total waste 1 136 Other waste 21 32 50 40 Total waste without recycled metal 685 885 909 896 Waste intensity t/MEUR (parent company) 319 3,3 446 3,7 451 350 423

Water 2020 2019 2018 3,0 2017 2,7 2016 4,3 Raute Corporation Water consumption, m3 Rautetie 2, P.O. Box 69 7 509- 7 732 8 543 8 214 13 230 15551 Nastola, Finland electricity*Refers to GHG-Protocoland district heat Scope consumed 1-2 energy in own consumption operations. and Does respective not include emis sions. Scope 1 emissions cover fuels used in own operations. Scope 2 covers Tel. +358 3 829 11 energy included in rental agreements or small rented offices. [email protected] [email protected]

8 Raute Corporation

Rautetie 2, P.O. Box 69 15551 Nastola, Finland Tel. +358 3 829 11 [email protected] [email protected]