Metsä Board Oyj : Remuneration Policy

February 2024

REMUNERATION POLICY

Metsä Board's Remuneration Policy

This Remuneration Policy of Metsä Board Corporation will be presented to the Annual General Meeting convened on 26 March 2024 in accordance with Chapter 5, section 3a of the Limited Liability Companies Act (624/2006). The decision of the Annual General Meeting is advisory. The policy has been approved by the compa- ny's Board of Directors and prepared in accordance with the Corporate Governance Code 2020 and does not include changes to the Remuneration Policy approved by the Annual General Meeting on 11 June 2020.

The Remuneration Policy includes a description of the remuneration principles applicable to company's statutory governing bodies, the Board of Directors and the CEO, and of the decision-making process concerning remuneration as well as of the conditions for temporary deviating from the policy in exceptional circumstances.

The Remuneration Policy is presented to the General Meeting at minimum every four years and whenever it has been subject to material changes. Should the General Meeting not endorse the Remuneration Policy, a revised policy would be presented at the following Annual General Meeting. The Board of Directors' Nomination and HR Committee monitors and assesses the policy's application and the implementation of the remuneration plans based on the policy. When necessary, the committee also makes proposals to the Board of Directors to update the policy.

This Remuneration Policy has been published as a stock exchange release on 22 February 2024 in connection

with the financial statements, and is available on the com- pany's website https://www.metsagroup.com/en/metsaboard/investors/.

Metsä Board's remuneration is based on the following main principles, which are applicable to the statutory governing bodies of company as well as all those employed by Metsä Board:

Ensuring sustainable and responsible business operations

Our remuneration supports the achievement of the com- pany's vision, strategic and operational goals as well as the goals of sustainable development. We encourage activities in line with the company's values and interests - responsible profitability, reliability, renewal and coopera- tion.

Ensuring performance and profitable growth

With remuneration, we encourage excellent performance and results in both short and long term. We remunerate our people for achieving and exceeding targets, and for profitable growth and the increase of shareholder and stakeholder value.

Supporting competence development and renewal With remuneration we support competence development and the commitment of talent. We encourage continuous improvement, renewal and the creation of conditions needed for future success. In addition to monetary remu- neration, we develop personnel's competencies and offer opportunities for career development. Our leadership is of a high quality and we encourage personnel's participa- tion.

February 2024

Consistency, competitiveness and transparency The remuneration is fair and based on clear principles and structures. We offer competitive overall re- muneration. We communicate and report on remuneration transparently and according to the require- ments.

February 2024

Remuneration decision-making order

BOARD OF DIRECTORS

The General Meeting decides on the remuneration of the Board of Directors. The Board of Directors' Nomination and HR Committee presents to the Annual General Meeting proposals on the Board of Directors' remunera- tion, taking into account this policy, the company's current financial standing at the time as well as the level of remuneration in other comparable companies, among other things. When necessary, the committee consults the company's majority shareholder, which exercises a controlling interest at the General Meeting with regard to Board remuneration. The following graph presents a general description of the decision-making process.

CEO

The Board of Directors decides on the remuneration of the company's CEO in accordance with the principles of this Remuneration Policy. The Board of Directors approves also the structure, target groups and principles of the company's remuneration plans, as well as selects the performance indicators used and sets related target values. The Board of Directors' Nomination and HR Committee assists the Board in matters related to the re- muneration, terms of employment and rewarding of Corporate Management Team members and prepares Board decisions concerning the CEO's remuneration.

February 2024

Summary of the remuneration of Metsä Board's CEO

Part of remuneration	Purpose	Description and criteria for determination
	Basic salary	To compensate for the requirements of	A fixed monthly salary, which may include a company housing and
		the position, CEO's individual compe-	company car benefit and other minor fringe benefits.
		tence and performance as well as pre-
		vailing market practice
	Supplementary pension	To offer a pension benefit supplementing	The CEO's retirement age may be lower than the retirement age pursu-
		statutory pensions	ant to the Employees Pensions Act. The CEO may be entitled to a sup-
			plementary pension insurance, whether a defined benefit or a defined
			contribution.
	Short-term incentive plans	To support the implementation of Metsä	The performance period of the short-term incentive plan is principally
		Board's strategy and annual targets as	one year. The reward cannot exceed the CEO's annual base salary.
		well as to remunerate for good perfor-	The Board of Directors decides annually on the targets and perfor-
		mance and for achieving organisational	mance indicators of the CEO's incentive plan. The rewards can be
		and individual targets	based on the achievement of Metsä Board's financial targets and other
			targets supporting strategy implementation. The rewards are approved
			by Metsä Board's Board of Directors.
	Long-term incentive plans	To align the objectives of the sharehold-	The performance period of long-term incentive plan is principally five
		ers and the executives in order to in-	years including the performance and the restriction periods. The reward
		crease the value of the Group in the long	cannot exceed the CEO's annual base salary multiplied by three. At the
		term, to commit the executives to per-	beginning of each performance period the Board of Directors decides
		form the Metsä Board's strategy, and to	on the targets and performance indicators of the incentive plan. The re-
		offer the executives a competitive reward	wards can be based on the achievement of Metsä Board's financial
		plan	and other possible strategic targets. The rewards are approved by
			Metsä Board's Board of Directors.
	Special rewards	To enable remuneration in special situa-	Special rewards may involve for example the recruitment of a new
		tions	CEO or corporate arrangements. Special rewards must be in accord-
			ance with this Remuneration Policy in terms of their value, time frame
			and performance requirements, and they must be approved by the
			Board of Directors.
	Insurances	To offer insurance coverage in line with	The CEO may have insurance benefits in line with market practice.
		market practice
	Terms and conditions of service con-	To ensure clear contractual terms and	The service terms and conditions are specified in a written CEO con-
	tract	conditions	tract and are approved by the Board of Directors. The term of notice
			pursuant to the contract is primarily up to six months. When the service
			contract is terminated by the company, the CEO is entitled to sever-
			ance pay corresponding to a maximum of CEO's 12 month salary. No
			severance compensation is paid if the contract is terminated by the
			CEO.
	The company's rights and clawback	To ensure the rewards are based on	The Board of Directors may in its discretion amend present targets dur-
	terms	achievements and results	ing a particular period for a justified reason. The Board of Directors also
			has the right to postpone or cancel payments related to the short and
			long-term incentive plans or apply clawback terms in exceptional cir-
			cumstances, such as a result of misconduct or faulty reporting of finan-
			cial results.

February 2024

Principles concerning temporary deviation from policy

The Remuneration Policy may temporarily be deviated from in exceptional circumstances where the operating conditions of Metsä Board change due to corporate arrangements or regulatory changes or when the com- pany's interests otherwise so require, and the prevailing Remuneration Policy is no longer deemed appropriate in such changed circumstances. Any deviation must be necessary to safeguard Metsä Board's long-term interests such as Metsä Board's long-term financial success, via- bility, competitiveness or the development of its shareholder value.

The deviation may apply to a part of the Remuneration Policy or to all of it, depending on the exceptional circum- stances. Any deviation is decided by the Board of Directors based on a proposal by the Nomination and HR Committee. Any deviation is reported in the Remuneration Report to be published for the relevant financial pe- riod. If a deviation from the Remuneration Policy continues other than temporarily, the Remuneration Policy shall be updated to accommodate the new situation and shall be presented at the next Annual General Meeting.