Union Pacific : 2023 Building America Report

2023

UNION PACIFIC RAILROAD

BUILDING AMERICA REPORT

WHAT'S INSIDE

WELCOME

3

BUILDING RESPONSIBLE FOUNDATIONS

10 CHAMPIONING ENVIRONMENTAL STEWARDSHIP 41

Our Approach to Building America Responsibly	3
Streamlined Sustainability Report Fosters
Greater Transparency	4
Our Progress	5
Our Teams and Programs Win Awards for
Sustainability and Equity	6
Sustainable Governance Practices Reinforce
Responsible Decision-Making	7
Updated Materiality Assessment Reflects
Stakeholder Perspectives	8

Health, Safety & Well-Being

Governmental Regulations

Business Ethics & Conduct

Cybersecurity

Risk Management & Internal Control

INVESTING IN OUR WORKFORCE

Human & Labor Rights

Employment Practices & Development

Diversity, Equity & Inclusion

DRIVING SUSTAINABLE SOLUTIONS

Operational Excellence

Infrastructure Investment & Protection

Resource Planning

Disruptive Technology

Responsible Sourcing

11	Environmental Management	42
15	Climate Change	44
16	Land Rights & Management	54
18	STRENGTHENING OUR COMMUNITIES	56
20
Stakeholder Engagement	57
21	Community Building & Giving	59
22	Socio-Economic Impact	62
23	APPENDIX	63
30
We Are Committed to Transparency	64
33	Material Topic Definitions	65
34	Cautionary Information	66
35
37
38
39

UNION PACIFIC 2023 BUILDING AMERICA REPORT

2

WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

Union Pacific CEO Jim Vena

OUR APPROACH TO BUILDING AMERICA RESPONSIBLY

Hello,

I am proud to share our Building America Report with you.

We know our role as the largest freight railroad in North America means caring for our people and the communities depending on us. Inside these pages, you will see how our Safety, Service and Operational Excellence strategy is positioning us to responsibly drive growth.

You will read about our strides in safety for our people and the communities where we operate, reducing year-over-year serious injuries by 15%, our year-over-year reportable derailment rate by 6% and overall track-related derailments by 28% in the last 10 years.

We know when our people develop, so does the environment where we operate and the economies we power. We share details on our culture, training, employee programs and governance.

Railroads are currently the most fuel-efficient way to move freight over land. We continue to make progress toward our climate action goals and have reduced Union Pacific's Scope 1 and 2 greenhouse gas (GHG) emissions by 19% over the past six years. In this report, you will read about how our near-termclimate-related activities align with our overall strategy.

You will also read about strides using technology to drive sustainability for the long term, including testing a first-of-its kind hybrid battery- electric locomotive. We will test the first of six units this year.

Our stakeholders are recognizing these and other sustainability accomplishments. We are proud to be the first U.S. Class I railroad named to the Dow Jones Sustainability World Index based on long- term economic, environmental and social criteria.

I am proud of Union Pacific and the work you will read about in the pages ahead.

Jim Vena, CEO

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

STREAMLINED SUSTAINABILITY REPORT FOSTERS GREATER TRANSPARENCY

This year, we streamlined our sustainability disclosure strategy by consolidating our separate reports (Climate Action Plan, We Are One Report and the Building America Report) into one comprehensive report - the Building America Report. This biennial report covers

all relevant sustainability topics, making it easier for stakeholders to access information with even more transparency. A separate Sustainability Data Supplement will be published annually, providing up-to-date data and metrics on our sustainability progress.

At the core of our strategy is a robust corporate governance process and framework supporting our sustainability-relateddecision-making, accountability and transparency. Our governance structure helps us prioritize the interests of our stakeholders, earning their trust and aligning our actions with their expectations. In the Corporate Governancesection, we highlight our updated sustainability governance structure, implemented in 2023.

Updating our materiality assessment is a key part of our governance; earlier this year we completed an updated materiality assessmentthat plays a pivotal role in shaping and guiding our sustainability strategy and reporting. This assessment uses a double materiality approach that helped us identify and prioritize the sustainability topics we have the greatest impact on, both internally and externally.

We strive to serve our customers, enhance shareholder value, invest in our communities and provide promising careers while operating in an ethical manner. We prioritize diversity, inclusivity, innovative technology, clean air and water, and setting and working toward our targets to reduce our carbon footprint. These efforts are encapsulated in our Building a Sustainable Strategy 2030 pillars, at right:

BUILDING RESPONSIBLE FOUNDATIONS

Union Pacific understands the importance of health, safety and well-being, business ethics and conduct, cybersecurity, and risk management and internal control.

INVESTING IN OUR WORKFORCE

At Union Pacific, we are committed to fostering a diverse and inclusive environment that reflects the diverse markets and communities we serve.

DRIVING SUSTAINABLE SOLUTIONS

Rail is the most fuel-efficient way to move freight over land, cutting GHG emissions by up to 75% compared to commercial trucks. Our goal is to capitalize on this advantage and offer customers a more environmentally- friendly form of freight transportation.

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

Union Pacific is committed to working to address the impacts of climate change. We have an updated Science Based target to reduce absolute Scope 1, Scope 2, and Scope 3 categories 1, 2 & 3 GHG emissions 50.4% by 2030 from a 2018 base year.

STRENGTHENING OUR COMMUNITIES

Union Pacific is dedicated to serving and investing in communities, improving the quality of life where our employees live and work. We pride ourselves on being a good corporate citizen and a champion for diverse suppliers.

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

In the following sections, we provide a comprehensive update on each of our material topics. The use of "material" when referring to sustainability OUR PROGRESS topics is intended to denote the most important issues from our sustainability materiality assessment, which is a different standard than the one

used in our financial disclosures. Before delving into these topics, we want to highlight our progress toward our targets and goals.

GOAL	2023 PROGRESS

BUILDING RESPONSIBLE FOUNDATIONS

EMPLOYEE SAFETY

DERAILMENT PREVENTION

Every employee goes home safe every day

Reduce the incidence of derailments

• In 2023, Union Pacific had zero work-related fatalities while reducing year-over-year serious injuries by 15%. Our reportable personal injury rate (employee injuries) increased 4% vs. 2022.
• Union Pacific's reportable derailment rate declined 6% vs. 2022.
• Over the past 10 years, track-related derailments have declined 28%.

INVESTING IN OUR WORKFORCE

11% women representation by 2030• 2023 progress in this area was flat year over year.

DIVERSITY & INCLUSION

40% minority representation by 2030	• During 2023 increased by one percentage point vs. 2022
to 34% of total workforce population.

DRIVING SUSTAINABLE SOLUTIONS

		• We are implementing this new performance metric during 2024. SPI
		is a ratio of the service customers are currently receiving relative to
		the best monthly performance over the last three years. Measuring our
OPERATIONAL EXCELLENCE		performance relative to a historical benchmark demonstrates our focus
Service Performance Index (SPI)	on continuously improving service for our customers, and we believe it is
		a better indicator of service performance than the previously disclosed
		Trip Plan Compliance. SPI does not replace the service commitments we
		have contractually agreed to with a small number of customers. Our SPI is
		calculated for intermodal and manifest/automotive products.

			50.4% Scope 1 and 2 absolute reduction		• In 2023, we reduced our absolute GHG emissions for Scope 1 and
				2 by 0.8% vs. 2022. Cumulatively, our emissions have experienced a
			by 2030 based on 2018 baseline*
				19.1% reduction vs. our 2018 baseline.
CHAMPIONING
GREENHOUSE GAS
50.4% Scope 3 absolute reduction for		• In 2023, we reduced our absolute GHG emissions for the target Scope
ENVIRONMENTAL	(GHG) EMISSIONS		3 categories by 0.8% vs. 2022. Cumulatively, our Scope 3 target
goods, and fuel- and energy-related
			categories' total GHG emissions have experienced a 12.1% absolute
			purchased goods and services, capital
STEWARDSHIP			activities by 2030 based on 2018 baseline*		reduction vs. our 2018 baseline, including a 21.9% cumulative absolute
			reduction in Scope 3 fuel- and energy-related activities.
	RENEWABLE FUELS	10% biofuels utilization by 2025		• Our full-year average utilization of biofuels in 2023 increased to 6.1%,
	20% biofuels utilization by 2030		vs. 4.5% in 2022.
			Increasing year-over-year spend with		• During 2023, we increased the number of our diverse suppliers by 6%,
				and increased our total procurement spend with diverse suppliers to
STRENGTHENING OUR			diverse suppliers to reach $850M
			$828 million, a 2% increase.
	COMMUNITY BUILDING
COMMUNITIES			• In 2023, 100% of local community grants went to local organizations
		100% of local community grants to		that advance the interests of and/or serve an underrepresented or
			DEI-aligned organizations		underserved population, or the organization is taking actions to instill
					DEI internally and/or within its programs.

*In January 2024, the Science-Based Targets Initiatives (SBTi) approved this updated 2030 near-term decarbonization target for Union Pacific. Union Pacific's prior target, approved in 2021, consisted of a 26% absolute reduction in Scope 1 and 2 GHG emissions and GHG emissions on a well-to-wheel basis from locomotive operations.

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

OUR TEAMS AND PROGRAMS WIN AWARDS FOR SUSTAINABILITY AND EQUITY

"We are proud of the awards we've achieved for our commitment to sustainability, diversity, equity and inclusion," said Union Pacific President Beth Whited. "They are a testament to our focus on this critical work over several years."

Union Pacific earned a spot on the Noteworthy List of the 2023 Top 50 Companies for Diversity compiled by DiversityInc. Union Pacific also landed a spot on DiversityInc Top 50 list for talent acquisition for women of color.

Disability:IN recognized Union Pacific as a Best Place to Work for Disability Inclusion in 2023.

Union Pacific earned a spot on the America's Most Just Companies List and was named an Industry Leader by Just Capital.

Union Pacific earned top marks - and a top spot - on the Human Rights Campaign's Best Places to Work list for LGBTQ+ Equality.

Union Pacific was selected as a member of both the Dow Jones Sustainability Index (DJSI) North America and World for the first time, underscoring its sustainable leadership and continued steps to achieve its ambitious environmental commitments.

Union Pacific earned a spot on Fortune Magazine's World's Most Admired Companies and was the highest ranked railroad in the Trucking, Transportation and Logistics category.

For the seventh year in a row, Union Pacific was identified as a Trendsetter in the 2023 CPA-Zicklin Index compiled by the Center for Political Accountability.

Union Pacific ranked 3rd among the Top 50 Inspiring Workplaces in North America.

Visit our Awards & Accoladeswebpage for the full list.

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

SUSTAINABLE GOVERNANCE PRACTICES REINFORCE RESPONSIBLE DECISION-MAKING

Strong corporate governance practices play an important role in promoting responsible and ethical business practices that prioritize the long-termwell-being of the company, society and environment. They help establish transparency, accountability and strategic decision-making that aligns with sustainability considerations and, ultimately, creates value for all stakeholders.

To oversee and guide the appropriate management of sustainability, we established the following governance structure:

SUSTAINABILITY-RELATED CORPORATE GOVERNANCE

BOARD OF DIRECTORS

Both directly and through its committees, provides oversight on sustainability-related issues, including the integration of sustainable practices into the company's strategies, policies, and decision-making processes.

GOVERNANCE, NOMINATING &	AUDIT	FINANCE	COMPENSATION &	SAFETY & SERVICE
SUSTAINABILITY COMMITTEE	COMMITTEE	COMMITTEE	BENEFITS COMMITTEE	QUALITY COMMITTEE
Responsible for reviewing current	Primarily responsible for	Monitors the company's financial	Provides oversight on human	Reviews and provides oversight
developments in sustainability	oversight of risks and controls,	policies and financial condition,	capital strategies including	of the safety programs
and recommending practices,	including considering and	including review of plans,	diversity programs, recruitment,	and practices within the
policies, and procedures.	addressing sustainability and	programs and initiatives related to	development and retention of	operations of the company.
	climate-related risks.	sustainability and climate change.	employees, and employee
			effectiveness and engagement.

EXECUTIVE LEADERSHIP

The President of Union Pacific, who reports to the CEO, holds direct responsibility for sustainability-related issues. Reporting to the

President is the AVP of Strategy and Sustainability who is responsible for developing and implementing UP's sustainability strategy.

SUSTAINABILITY STEERING COMMITTEE

Senior leaders from Law, Finance, Marketing and Sales, Operations, Supply Chain, Environmental Management, Corporate Relations,

Investor Relations, and Workforce Resources meet quarterly to drive decision-making, accountability and ownership of specific initiatives.

SUSTAINABILITY MANAGEMENT

Employees with sustainability-related functions are responsible for managing the day-to-day sustainability work and implementing initiatives across various departments, monitoring progress, and driving continuous improvement.

Sustainability Tied to Executive and Management Compensation

To advance our sustainability governance efforts, we continue to evolve sustainability-related Key Performance Indicators (KPIs) in our executive and management compensation scorecards. For 2023,

a portion of executives' target annual incentive cash bonuses were based on a shared set of our company goals in key areas linked to sustainability, including safety, customer service, trip plan compliance, employee engagement and renewable fuel blend utilization. For more information, see our 2024 Proxy statement.

Business unit managers support and implement strategies to progress our sustainability strategies, including improving employee and public safety results, reducing our locomotive fuel consumption rate via operational excellence and technology initiatives, and increasing employee engagement and renewable fuel blend utilization. Achievements in these areas are factors in the annual performance appraisals of business unit managers and impact their incentive bonus compensation.

UNION PACIFIC UPDATES

GOVERNANCE STRUCTURE

In 2023, Union Pacific announced the appointment of Jim Vena as Chief Executive Officer and board member. We also announced Beth Whited as President, and Mike McCarthy as Chairman of the Board. Prior to these announcements, the roles of CEO, President and Chairman of the Board were held by one individual.

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

UPDATED MATERIALITY ASSESSMENT REFLECTS STAKEHOLDER PERSPECTIVES

Materiality assessments are important tools guiding companies on their sustainability journeys. By identifying the most significant issues, companies can focus resources on areas with the greatest impact on sustainability performance, value creation and risk mitigation. This year, we enhanced our materiality approach by adopting a double materiality process that considered accepted sustainability standards and guidelines. We analyzed potential topics, considering their impact on both our financial performance and their potential effects on people, the economy and the environment.

Our process included reviewing our 2021 materiality assessment topics, examining trending industry issues and surveying key sustainability frameworks. After narrowing the list to topics relevant to our business, we engaged internal and external stakeholders through an online survey to understand their perspectives on how each topic could positively or negatively impact our business results, people, the economy and the environment. Participants included our senior executive leadership team, employees at all levels of the company, including members of our unionized workforce, and representative customers, suppliers, trade associations and community organizations.

We analyzed results to incorporate all views and reviewed for further refinement with our senior executive leadership team, who approved this updated assessment.

Materiality Matrix Update: Evolving Our Sustainability Strategy

These insights inform our evolving sustainability strategy. While all topics were rated as having some level of significance by our stakeholders, the assessment exercise highlighted the importance of Operational Excellence, Infrastructure Investment & Protection, Cybersecurity, Governmental Regulations and Resource Planning as "very significant" material topics.

Our updated assessment resulted in four new material topics: Operational Excellence, Governmental Regulations, Resource Planning and Disruptive Technology. We also combined three material topics from our 2021 assessment - Emissions, Energy Use and Climate Change - into one topic titled "Climate Change" and redefined the Waste Management & Recycling topic more broadly, titling it "Environmental Management."

Similar to last year's Building America Report, we grouped our material topics under the five pillars of our Building a Sustainable Future 2030 Strategy.

The y-axis depicts the issues scored by stakeholders as having the greatest long-term impact on people, the economy and the environment. The x-axis depicts the issues scored as having the greatest long-term impact on our future financial success. We anticipate refreshing this assessment periodically to monitor the evolution of the topics most important to our business.

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

UNION PACIFIC MATERIALITY MATRIX

BUILDING RESPONSIBLE FOUNDATIONS

• Health, Safety & Well-Being
• Governmental Regulations*
• Business Ethics & Conduct
• Cybersecurity
• Risk Management & Internal Control

INVESTING IN OUR WORKPLACE

• Human & Labor Rights
• Employment Practices & EE Development
• Diversity, Equity & Inclusion

DRIVING SUSTAINABLE SOLUTIONS

• Operational Excellence*
• Infrastructure Investment & Protection
• Resource Planning*
• Disruptive Technology*
• Responsible Sourcing

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

• Environmental Management
• Climate Change
• Land Rights & Management

STRENGTHENING OUR COMMUNITIES

• Stakeholder Engagement
• Community Building & Giving
• Socio-EconomicImpact

*New Topic for 2024

ENVIRONMENT	VERY SIGNIFICANT
IMPACT ON PEOPLE, THE ECONOMY, OR THE	SLIGHTLY SIGNIFICANT

OPERATIONAL

EXCELLENCE

GOVERNMENTAL

REGULATIONS

INFRASTRUCTURE INVESTMENT

RESOURCE PLANNING

& PROTECTION

DISRUPTIVE

TECHNOLOGY

EMPLOYMENT

BUSINESS ETHICS & CONDUCT

CYBERSECURITY

PRACTICES &

HEALTH, SAFETY & WELL-BEING

EE DEVELOPMENT

STAKEHOLDER ENGAGEMENT

RISK MANAGEMENT

& INTERNAL CONTROL

ENVIRONMENTAL

MANAGEMENT

HUMAN & LABOR RIGHTS

RESPONSIBLE SOURCING

LAND RIGHTS &

MANAGEMENT

DIVERSITY, EQUITY & INCLUSION

CLIMATE CHANGE

COMMUNITY BUILDING &

GIVING

SOCIO-ECONOMIC IMPACT

SLIGHTLY SIGNIFICANT

VERY SIGNIFICANT

IMPACT ON UNION PACIFIC'S FUTURE FINANCIAL SUCCESS

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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WELCOME

BUILDING RESPONSIBLE FOUNDATIONS

INVESTING IN OUR WORKFORCE

DRIVING SUSTAINABLE SOLUTIONS

CHAMPIONING ENVIRONMENTAL STEWARDSHIP

STRENGTHENING OUR COMMUNITIES

APPENDIX

BUILDING RESPONSIBLE FOUNDATIONS

UNION PACIFIC 2023 BUILDING AMERICA REPORT

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