Climate Change Data

Environmental Metrics

ESG Focus Areas

• Workforce Development
• Sustainable Environments
• Ethical Business
• Supporting Communities

Environmental Achievements

• Reduced water extraction from the local water supply network for the sixth successive year.
• Increased natural gas substitution in pelletiser from 19% to 30% in 4Q 2019.
• 2% reduction in direct CO2 emissions per pellet in 2019.
• Reuse of waste from processed ores up to 7% (2018: 5%)

Social Achievements

• Recorded its lowest injury frequency rate since Ferrexpo listed in 2007.
• Ferrexpo Yeristovo Mining finished 2019 without a single lost time injury.
• Successfully conducted its second employee engagement survey, receiving feedback from over 4,750 employees.
• Completion of Ferrexpo Square – urban regeneration project

Governance Achievements

• Commissioned an independent report on its tailings facility by consultants Knight Piésold, concluding that Ferrexpo’s tailings facility is well managed and of an appropriate design.
• Implemented a new Code of Conduct for Business Partners, incorporating compliance clauses into 92% of agreements with annual turnover in excess of UAH500,000.
• Increased workers’ agreement with the goals and objectives of the Code compared to 2018.

Climate Goals & Targets

Environmental Challenges

• Drier weather conditions leading to increased dust creation.
• Long-term trend towards carbon-neutral steel making amongst steel producers.
• Potential for increased water stress and scarcity due to climate change.
• Potential for extreme weather events to disrupt operations and logistics.

Mitigation Strategies

• Implementing carbon reduction initiatives and clear reporting of GHG emissions.
• Improving operational efficiencies and efficient procurement practices.
• Investing in mining and processing operations to optimize product mix.
• Improving blasting practices to reduce energy consumption.
• Upgrading high voltage motors in the beneficiation plant.
• Testing autonomous trucks and drill rigs.

Supply Chain Management

Supplier Audits: 73% of supplier contracts in Ukraine contain compliance-related clauses

Responsible Procurement

• Code of Conduct for Third Parties
• Compliance clauses in contracts

Climate-Related Risks & Opportunities

Physical Risks

• Increased severity of extreme weather events
• Changes in precipitation patterns

Transition Risks

• Carbon pricing
• Enhanced emissions-reporting obligations
• Mandates on and regulation of existing products
• Exposure to litigation
• Substitution of existing products
• Unsuccessful investment in new technologies
• Changing customer behaviour
• Market uncertainty
• Increased cost of raw materials
• Shifts in consumer preferences
• Stigmatisation of sector
• Increased stakeholder concern

Opportunities

• Mandates on and regulation of existing products
• Successful investment in new technologies
• Changing customer behaviour

Reporting Standards

Frameworks Used: GRI, TCFD, SASB, Greenhouse Gas Protocol, UN SDGs

Certifications: OHSAS 18001 (transitioning to ISO 45001)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 1
• Goal 3
• Goal 4
• Goal 5
• Goal 7
• Goal 8
• Goal 13

Detailed explanation of alignment with SDGs provided in the report.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Safety
• Growth
• Modern Technologies
• Premium Product
• Sustainability

Environmental Achievements

• 16% Reduction in CO2e per tonne by 16% in 2020 to 113kg/t
• 12% reduction in water extraction from local supply network

Social Achievements

• 94% Employee approval rate for Group’s COVID-19 response
• US$3.5M Funding approved to date for local communities in response to COVID-19
• Celebrating a decade of direct community support through the Ferrexpo Charity Fund (2011-2021)

Governance Achievements

• Number of Independent Non-Executive Directors increased to four (2019: three)
• 600 Participants at the Group’s second annual Compliance Week

Climate Goals & Targets

Environmental Challenges

• One fatality at its operations in 2020
• COVID-19 pandemic impacting operations and communities
• Climate change related risks (drier weather, carbon-neutral steelmaking trend)

Mitigation Strategies

• Implemented recommendations to improve practices following fatality investigation
• COVID-19 Response Fund (US$3.5M)
• Carbon reduction initiatives, enhanced emissions reporting, joining ResponsibleSteel initiative
• Purchasing clean electricity, implementing pantograph network, electric haul trucks, biofuel substitution, hydrogen review

Supply Chain Management

Supplier Audits: 2,428 suppliers screened in 2020

Responsible Procurement

• Code of Conduct for Suppliers
• Focus on local suppliers (94% of procurement in Ukraine from Ukrainian businesses)

Climate-Related Risks & Opportunities

Physical Risks

• Increased severity of extreme weather events
• Changes in precipitation patterns

Transition Risks

• Carbon pricing
• Enhanced emissions reporting obligations
• Mandates on and regulation of existing products
• Exposure to litigation
• Substitution of existing products
• Unsuccessful investment in new technologies
• Changing customer behaviour
• Market uncertainty
• Increased cost of raw materials
• Shifts in consumer preferences
• Stigmatisation of sector
• Increased stakeholder concern

Opportunities

• Mandates on and regulation of existing products
• Successful investment in new technologies
• Changing customer behaviour
• Shifts in consumer preferences

Reporting Standards

Frameworks Used: GRI, TCFD, SASB

Certifications: ISO 45001, ISO 50001:2018, ISO 14001:2015

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 3 (Good Health and Well-being)
• Goal 4 (Quality Education)
• Goal 5 (Gender Equality)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 6 (Clean Water and Sanitation)

Initiatives contributing to these goals are detailed throughout the report.

Sustainable Products & Innovation

• Direct reduction pellets

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Greenhouse gas emissions
• Health and Safety

Environmental Achievements

• 31% reduction in GHG emissions (Scope 1 and 2 basis, per unit of production) as of the end of 2022

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, Greenhouse Gas Protocol

Third-party Assurance: MHA MacIntyre Hudson

Sustainable Products & Innovation

• Higher grade (67% Fe), direct reduction pellets

Environmental Metrics

ESG Focus Areas

• Supporting Ukraine
• Community Development
• Workforce Development
• Sustainable Environments
• Ethical Business
• Green Steel

Environmental Achievements

• 2% reduction in Scope 1 and 2 emissions per unit of production
• 97% of process water recycled
• 8% reduction in waste

Social Achievements

• Supported more than 100 projects and initiatives through the Ferrexpo Humanitarian Fund and CSR spending, totaling US$25 million
• Lost Time Injury Frequency Rate (LTIFR) improved to 0.32 in 2023 (2022: 0.51)
• Increase in women in management roles to 22.3% in 2023 (2022: 20.9%)
• Provided humanitarian aid to over 3,500 internally displaced people

Governance Achievements

• Conducted first Double Materiality Assessment (DMA)
• Life Cycle Assessment (LCA) carried out to understand Net Zero pathway
• 94% of supplier contracts referenced Code of Conduct
• 1,959 supplier reviews conducted

Climate Goals & Targets

Environmental Challenges

• War in Ukraine impacting workforce, operations, and supply chains
• Workforce fatigue due to ongoing war
• Loss of life among employees serving in the Armed Forces of Ukraine
• Supply chain disruptions due to the war

Mitigation Strategies

• Adapted responsible business approach to support people during difficult times
• Extended Humanitarian Fund to provide various initiatives and projects
• Offered individual and family support for returning veterans
• Community activities aimed at engaging people and boosting morale
• Restored capacity out of Ukrainian Black Sea ports and replenished supply chains
• Invested in capital projects to improve product quality and operating costs

Supply Chain Management

Supplier Audits: 1,959

Responsible Procurement

• Code of Conduct for Suppliers

Climate-Related Risks & Opportunities

Opportunities

• Electrification and automation of mining processes
• Production of green steel

Reporting Standards

Frameworks Used: UN SDGs, SASB, TCFD

Certifications: ISO 14001:2015, ISO 50001:2018, ISO 45001

Third-party Assurance: MHA (ISAE 3000 for Scope 1 and 2 emissions and key safety metrics)

Sustainable Products & Innovation

• DR pellets

Awards & Recognition

• Global Good award for humanitarian contributions
• Best Employer for Veterans by Forbes Ukraine

Environmental Metrics

ESG Focus Areas

• Humanitarian efforts
• CSR
• Support for veterans
• GHG emissions reduction
• Diversity & Inclusion
• Women in the workplace

Environmental Achievements

• 32% reduction in GHG emissions since 2019 (reported in 2023 Annual Results)
• Reduced unit emissions (kg CO2e per tonne of production) in 1H 2024 despite increased absolute emissions due to higher production volumes.
• Increased share of clean power purchases (61% from hydro and nuclear in 1H 2024)

Social Achievements

• Retained entire workforce during wartime
• Supported internally displaced people and veterans
• Focus on mental health and community initiatives
• Implemented a six-week training program for managers on interacting with veterans with PTSD
• 31% of employees are female (highest ratio in Ukrainian metals and mining sector)
• 22.4% women in management positions (target of 25% by 2030)
• Fe_munity School of Women's Leadership program completed by over 200 female leaders
• Ferrexpo School of Inclusion training for over 100 managers

Governance Achievements

• Held 2024 Annual General Meeting (AGM)
• Board intends to consult shareholders following votes against re-election of an Independent Non-Executive Director

Climate Goals & Targets

Environmental Challenges

• War in Ukraine impacting operations, logistics, and workforce
• Lower iron ore prices and significantly higher electricity prices
• Russian attacks on Ukrainian power generation and transmission infrastructure
• Higher seaborne freight rates and risk premia
• Ongoing legal disputes in Ukraine
• Uncertainty in the application of local legislation in Ukraine

Mitigation Strategies

• Adapting to complexities of prolonged war, embedding flexibility into operations
• Resuming exports through Ukrainian Black Sea ports
• Cost-saving initiatives
• Sourcing electricity from European neighbours
• Continued capital investment in sustaining and development projects
• Focus on higher-grade iron ore production
• Implementing press filtration technology to improve pellet quality and reduce gas consumption

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• FDP pellets (used in direct reduction steelmaking)

Awards & Recognition

• HR Pro Awards
• Top ten Ukrainian employer according to the Ukrainian Index of Corporate Equality