The role of the administrative, management and supervisory bodies

Board composition

The Board is composed of 15 Directors, which includes the Non-Executive Chair, two Executive Directors, three ERDs (Employee Representative Directors) and nine NEDs (Non-Executive Directors).

As at 31 December 2024, the Board composition was:

Board gender diversity: 67% Male, 33% Female

Board independence: When assessing independence under the UKCGC, the Board has included time served by that Director on the board of RHI AG prior to the merger with Magnesita in 2017. On this basis, Wolfgang Ruttenstorfer exceeds nine years of service. None of the other criteria in Provision 10 of the UKCGC apply to him, and the Board remains comfortable that he provides strong, independent challenge to management.

Given their longstanding service and also their connections to major shareholders, David Schlaff and Stanislaus Prinz zu Sayn-Wittgenstein-Berleburg are also not considered to be Independent Non-Executive Directors.

The Board has six out of 11 eligible Directors who are deemed independent (as set out in the table on the previous page), thereby constituting a Board that is composed of at least half NEDs (excluding the Chair) considered by the Board to be independent for the purposes of the UKCGC. Under the criteria of the DCGC, the current Board can be considered as 67% independent.

Specific committees with sustainability oversight

Corporate Sustainability Committee (CSC):

• Chair: Janet Ashdown
• Members: Marie-Hélène Ametsreiter, Stanislaus Prinz zu Sayn-Wittgenstein-Berleburg
• Meetings in 2024: 3
• Attendance: All members attended 3/3 meetings

The CSC is the Board committee responsible for overseeing sustainability-related impacts, risks, and opportunities. In 2024, a DMA (Double Materiality Assessment) was conducted for the first time in alignment with ESRS requirements. CSC members actively participated in the process, providing oversight and reviewing its findings, while the final approval was granted by the Board of Directors.

The CSC monitors progress towards the Group's sustainability targets at every meeting, using year to date information and full year forecast outcomes. Executives responsible for delivering sustainability targets are invited to present to the CSC at least once per year.

New sustainability targets for 2030 were set in 2025 after due consideration by the CSC in November 2024, formally adopted by the Board in February 2025.

Audit & Compliance Committee:

• Chair: John Ramsay
• Members: Jann Brown, Wolfgang Ruttenstorfer
• Meetings in 2024: 5
• Attendance: All members attended 5/5 meetings

Remuneration Committee:

• Chair: Janet Ashdown
• Members: Karl Sevelda, Jann Brown
• Meetings in 2024: 4
• Attendance: All members attended 4/4 meetings

Nomination & Governance Committee:

• Chair: Herbert Cordt
• Members: John Ramsay, Karl Sevelda
• Meetings in 2024: 3
• Attendance: All members attended 3/3 meetings

Board attendance in 2024: All 15 Directors attended 9/9 Board meetings in 2024. In addition to formal meetings, two Board sub-committees were held to approve matters specifically delegated by the Board.

Sustainability-related expertise of board members

CSC skill and experience in sustainability matters: CSC members are skilled and experienced in their individual specialisms. Since its formation in 2019 the CSC has been tasked with supervision of the delivery of the Group's sustainability related goals and priorities and has therefore gained experience in specific areas relevant to those initiatives. The CSC has access to expertise and skills from specialist staff within RHI Magnesita who are experienced in sustainability matters and undertakes site visits once per annum to broaden its specific RHI Magnesita knowledge, such as to our Leoben pilot plant to hear directly from experts on the in-trial sorting initiatives to progress recycling progress, supporting the decarbonisation of the industry.

Board skills and experience: The Nomination & Governance Committee seeks to ensure the right balance of skills, knowledge and experience on the Board, taking account of the business model, long-term strategy and the sectors and geographic locations in which the Group operates. The Board is structured so that the following experience and capabilities are adequately represented:

• Knowledge and understanding of the business and products of the Company and its subsidiaries, the markets and geographies in which the Company and its subsidiaries operate
• International background and geopolitical exposure
• Broad Board experience, including knowledge of corporate governance issues
• Understanding of ESG, corporate social responsibility and sustainability matters, particularly decarbonisation
• Practical experience in financing and accounting and/or experience in relation to IFRS, as well as in risk management and internal controls
• Understanding of the markets where the Company is active, particularly emerging markets
• Expertise in science, technology and innovation, as well as practical experience in operations, manufacturing and logistics
• Experience and understanding of human resources and remuneration-related matters

The Nomination & Governance Committee considers that all of these aspects are well represented across the Board.

Frequency of sustainability discussions at board level

The CSC receives updates at every meeting (its terms of reference require a minimum of three meetings per annum) on the progress against the targets set as part of its set agenda planner. These committees update the Board at the meeting which follows their meeting as part of their reporting.

Sustainability specific risks are assessed separately and submitted to the principal risk assessment process via the CSC. The Board ranks sustainability specific risks alongside other risks to the business based on the likelihood of occurrence and potential financial or reputational impact.

Material impacts, risks and opportunities addressed by the CSC, Board and EMT included all those set out in the DMA which was conducted for the first time in 2024. In addition, during 2024, the CSC, the Board and the EMT considered the following sustainability topics in detail:

• Health and safety of own workforce
• Recycling
• Sustainable sourcing and modern slavery
• Physical climate change risks
• Sustainability governance
• CO2 capture and utilisation
• Regulatory developments
• Assurance of sustainability data
• Energy and CO2 markets
• Customer, employee, investor and supplier perceptions of ESG and related products
• Community relations
• Organisational diversity
• Use of renewable energy
• Target setting and measurement
• Capital allocation to sustainability initiatives
• Decarbonisation strategy
• Low carbon footprint product strategy
• Use of hydrogen and other alternative fuels

Specific roles assigned

EMT role in managing and overseeing sustainability impacts, risks and opportunities:

The EMT is the primary management body through which initiatives to address sustainability related impacts, risks and opportunities are planned, implemented and monitored. The Chief Executive Officer (CEO) is the most senior executive responsible for policy implementation and overall monitoring and management of sustainability impacts, risks and opportunities.

Individual EMT members are responsible for delivery in specific areas:

Regional management are responsible for delivery of specific regional sustainability objectives and integration of acquired businesses into the Group's sustainability practices.

Executive management holds an annual Sustainability Forum to share progress against targets and co-operate on the delivery of the Group's sustainability objectives. The CEO reviews progress against short- and long-term sustainability KPIs during the year.

Process for setting and monitoring sustainability targets:

RHI Magnesita's executive management and the Board considered and set sustainability targets in 2019 to be achieved by 2025, against a 2018 baseline. During 2024 the Group worked to establish new targets for 2030. Teams responsible for material sustainability topics were tasked with setting realistic and achievable targets by 2030 in the first half of 2024. The CEO reviewed the proposed targets and they were subsequently presented to the CSC in November 2024 for review and discussion. The CSC recommended changes to the proposed targets which were then finalised and adopted by the Board of Directors in February 2025.

2025 Targets:

2030 Targets:

Progress against sustainability targets is generally measured on a monthly basis by responsible functions and year to date performance is reviewed at every meeting of the CSC.

Sustainability governance structure:

At Board level, the CSC supports the Board, acting as an advisory body to deliver the long-term sustainability of the business. The CSC monitors performance against relevant KPIs and assesses risks and opportunities associated with climate change, environmental, Health & Safety, stakeholder relations and other ESG risks.

At EMT level, the CEO is accountable for driving sustainable practices within the organisation and delivering the Group's sustainability targets, supported by the CTO. The CTO actively engages in overseeing and integrating technologies and methodologies across various aspects of operations.

Reporting to the CTO, the Global Sustainability Team collaborates closely with the CEO, CTO and CSC to monitor progress against targets, advise on regulatory developments, compile reporting materials and engage with external ratings agencies.

At the operational level, plant managers and Regional Presidents are accountable for the day-to-day performance of the Group's assets, including delivering progress towards sustainability goals. Regional Presidents report to the Chief Customer Officer who in turn reports to the CEO.

Independence and effectiveness arrangements

The Board is the supervisory body which considers sustainability impacts, risks and opportunities when assessing strategic decisions, such as major transactions, and in its semi-annual assessment of principal and emerging risks. Trade-offs between potentially conflicting impacts, risks and opportunities are considered, for example, when pursuing an acquisition-led growth strategy the Board assesses the executive management's assessment of the potential impacts and opportunities in sustainability performance of each new acquisition, such as the potential to increase the use of secondary raw materials, but also the possibility that there could be an impact on the Group's carbon emissions with the asset's energy profile or age of equipment.

The Board are updated on at least an annual basis as part of the strategy session on the progress against the targets set in 2019 for delivery by 2025. The annual budget comprises sustainability-related spending and the Board considers this twice per annum in its agreed schedule. In the course of delivering their duties as effective Directors, the Board have engaged with these updates and challenged management on the measurement and progress, as appropriate.

Board performance review:

In respect of 2023, in Q1 2024 the Board completed a questionnaire covering dynamics, performance of the Board and its Committees, overall support provided to the Directors, self-assessment of their individual performance, and strategic focus areas. The EMT also gave feedback on their relationship and perception of the Board's performance.

For the 2024 review, Directors will undertake individual interviews with the SID & Deputy Chair, supported by the Company Secretary. The outcome will be considered in April 2025.

Integration of sustainability-related performance in incentive schemes

Roles covered

The integration of sustainability-related performance in incentive schemes applies to:

• Executive Directors: CEO and CFO
• All bonus-eligible employees: The annual bonus linked to performance is managed uniformly across the Group, with all bonus-eligible employees receiving the same annual payout ratio as senior management, based on the achievement of the annual Group bonus targets.
• Executive Management Team (EMT): Members participate in both short-term and long-term incentive schemes

Sustainability KPIs tied to remuneration

Annual Bonus

2024 Performance Criteria:

Recycling, a key sustainability performance metric, accounts for 10% of the annual bonus.

2025 Performance Criteria:

In 2025, recycling will again account for 10% of the annual bonus.

Long-Term Incentive Plan (LTIP)

2024 LTIP Award:

25% of the LTIP award is linked to CO2 emissions performance conditions.

The performance period for these conditions is three financial years, starting in 2024, and the Executive Directors are then subject to a further holding period of two years to further align their performance with long-term shareholder value creation.

2025 LTIP Award:

Awards vest on a straight-line basis between threshold, intermediate and maximum. A two-year post vesting holding period applies.

The 2025 LTIP Award has a 25% component linked to the Group's target to reduce CO2 emissions intensity by 2027.

Maximum bonus and LTIP opportunities

Annual Bonus:

• Maximum bonus opportunity for Executive Directors: 150% of salary
• Executive Directors are required to use 50% of any bonus earned in excess of target (net of tax) to acquire shares in the Company that will be held for a minimum of three years

LTIP:

• CEO: Award over shares with a value at grant of 200% of salary
• CFO: Award over shares with a value at grant of 150% of salary

Threshold/target/maximum performance structure

Annual Bonus: The Group uses performance targets with threshold, target, and maximum levels for financial and strategic deliverables. Specific targets relating to the 2025 bonus have not been disclosed as they are considered commercially sensitive, with details to be provided retrospectively.

LTIP: For the 2025 LTIP:

• Threshold performance results in 25% vesting
• Intermediate performance results in 75% vesting
• Maximum performance results in 100% vesting
• Vesting occurs on a straight-line basis between these points

Payout against sustainability KPIs in the reporting period

The disclosure states that recycling accounts for 10% of the annual bonus and CO2 emissions account for 25% of the LTIP award, but specific payout percentages achieved against these sustainability KPIs for the 2024 reporting period are not disclosed in the extracted sections.

Governance and rationale

Given sustainability is a core element of RHI Magnesita's strategy, and given its relevance to the Group's sustainable growth, the Board have been keen to ensure it is part of the incentivisation of management. For a number of years the Group's remuneration approach has included sustainability targets, particularly focusing on those relating to the carbon footprint.

The Group is responsive to feedback from investors and customers on such topics and incorporates their views as inputs to the Group's sustainability approach. The Corporate Sustainability Committee (CSC) supports the Board with its deliberations on sustainable initiatives, targets and investments and supports the Remuneration Committee with priorities to be incentivised.

The Remuneration Committee's responsibilities include the development of a reward package for Executive Directors and senior managers that supports the delivery of RHI Magnesita's vision and strategy as a Group, ensuring rewards are performance-based, encouraging long-term shareholder value creation, and taking account of the remuneration of the wider workforce.

Note: Non-Executive Directors do not receive incentive-based remuneration; their remuneration is an annual fixed fee with no share-based payments.

Our business model and value chain

We are masters of heat, the leading global supplier of high-grade refractory products, systems and solutions. We have a vertically integrated value chain ranging from raw material sourcing to refractory production and performance-based solutions.

Our purpose: to master heat, enabling global industries to build sustainable modern life. We offer refractory products and services that shape tomorrow's world. Our advanced products are essential for our customers in the steel, cement, metals, glass and chemicals industries.

Value chain activities:

• Raw materials: RHI Magnesita operates raw material sites in Austria, Brazil, China, Czechia, Türkiye and USA. 67% of magnesite and dolomite raw material usage by volume was sourced internally in 2024, contributing 0.8% to Group Adjusted EBITA margin.
• Refractory production: The Group operates 53 refractory production plants in Europe, Türkiye, India, China and the Americas.
• Logistics: Timely raw material and finished goods deliveries with effective inventory management strategies.
• Research & Development: Development of new products, customisation and improved production techniques. R&D is essential to maintaining our position as market leader and achieving longer-term sustainability objectives.
• Services: Design, installation, monitoring, maintenance, optimisation, removal and recycling of refractory solutions.

Business model evolution - 4PRO: A comprehensive offering that reflects our expanded capabilities including sustainable products, robotics, systems, sensors, digital solutions, decarbonisation solutions and clean and green steel solutions. 80% of customers are interested in the 4PRO offering when made aware of it.

Stakeholder engagement

RHI Magnesita engages with key stakeholder groups through various channels:

Shareholders: Regular engagement via one-on-one meetings, investor presentations, AGM, industry conferences. Priority topics include company strategy, operational performance, geopolitical outlook, sustainability agenda, climate strategy.

Customers: Day-to-day contact, technical consulting, customer satisfaction surveys with Net Promoter Score as key metric. The Board meets customers during site visits. Priority topics include service levels, climate change opportunities, health & safety.

Employees: Communication through townhall meetings, Workvivo app, Culture Champions network. Board engages through Employee Representative Directors and plant visits. Priority topics include operational performance, health & safety, business restructuring, salary growth, work/life balance.

Communities: Member of UN Global Compact supporting UN SDGs. Local engagement at operational level. Focus areas include education, health and medical care, environment. Community investment increased in 2024.

Governments and authorities: Ongoing dialogue with government agencies. Hosted Director General from EU Commission at Breitenau mine. Key discussions on raw materials, sustainability, infrastructure.

Material impacts, risks and opportunities and their interaction with strategy and business model

RHI Magnesita has conducted a comprehensive Double Materiality Assessment (DMA) in line with the ESRS framework, evaluating sustainability-related impacts, risks and opportunities across its value chain. The impact materiality assessment identified and classified sustainability impacts, risks and opportunities assessing their significance based on scale, scope, remediability, and likelihood. Simultaneously, the financial materiality assessment mapped ESG risks and opportunities against ESRS topics, aligning them with RHI Magnesita's risk management methodology. This assessment, validated by RHI Magnesita's audit and sustainability committees on behalf of the Board, integrates insights from internal experts and external stakeholders.

Full list of material IROs

The following table presents all material impacts, risks and opportunities identified through the DMA:

Linkage between IROs and strategy / business model

Climate change and decarbonisation

Driving down carbon emissions is a key priority for RHI Magnesita. The Group's emission reduction target is a 15% reduction in CO2 emissions intensity for Scope 1, 2 and 3 (raw materials) emissions by 2025, compared to 2018. The climate strategy is based on:

• reducing the carbon footprint of raw materials, including through the increased use of circular raw materials
• enhancing energy efficiency in operations
• reducing the carbon intensity of energy sources
• providing innovative solutions to reduce customer emissions

In the period to December 2024, the Group achieved a 14% reduction in CO2 emissions intensity, compared to its base year 2018 (2023: -12%). This progress is mainly a result of recycling overperformance.

Time horizons:

• Short term (2025): First set of sustainability targets planned within this timeframe
• Medium term (2030): Most likely horizon for regulatory frameworks (EU ETS and CBAM) to have partial effect on operations due to gradual phase out of free allocations
• Long-term (2050): Aligned with UN and policy-making bodies' decarbonisation goals

Opportunities from enabling technologies

RHI Magnesita provides refractory products specifically designed for Electric Arc Furnaces (EAFs), which are a vital enabling technology for the reduction of CO2 emissions in the steel industry. EAFs can be powered using electricity sourced partially or wholly from renewable electricity and replace the BOF phase of the traditional integrated steel manufacturing process, which is highly CO2 intensive.

The Group is well positioned to benefit from increased demand for low carbon footprint products. Through the EU Taxonomy, the Group has identified taxonomy-eligible activities including:

• CCM 3.6 Manufacture of other low-carbon technologies (EAF refractories)
• CCM 5.9 Material recovery from non-hazardous waste
• CE 2.7 Sorting and material recovery of non-hazardous waste
• BIO 1.1 Conservation and restoration of habitats, ecosystems, and species

Carbon pricing risks

The increase in operating costs due to carbon pricing poses a significant risk. Without mitigation, the financial impacts of CBAM could result in a future negative impact on equity value ranging from €255 million to €480 million. The maximum possible cost impact if the Group is not able to make any reduction in its European Scope 1 emissions is approximately €80 million per year for its European operations.

No negative financial effects are expected in the next reporting period, 2025. The Group is in the process of developing new technologies and projects to reduce CO2 emissions but is not yet able to calculate the required capital expenditure or funding sources for such projects.

Recycling and circular economy

Recycling is a multi-faceted element of Group strategy since it benefits the business model in several ways. The reuse of one tonne of recycled refractory material prevents approximately 1.6 tonnes of CO₂ emissions compared to virgin raw materials, making recycling the most effective short-term lever to achieve the Group's 2025 emissions intensity target.

The 2024 Recycling Rate reached 14.2% which is on track to achieve 2025 Target of 15%. By year-end, RHI Magnesita plants had consumed 268 kt of recycled materials and sold 96 kt of metallurgical additives, marking a 30% volume increase compared to 2023. This led to €36 million in raw material cost savings for refractory finished goods and a reduction of 310 kt in CO₂ emissions.

Health and safety

Maintaining a safe and healthy workplace is fundamental to RHI Magnesita's culture and mindset. The Group assigns the highest importance to the health and safety of its employees and contractors. The Group has a target to eliminate fatalities and to maintain a Total Recordable Injury Frequency Rate of below 1.2 per 200,000 hours worked by 2030.

Poor health and safety performance could impact the Group's ESG ratings with a potential negative impact for the interest rate payable on its sustainability linked debt facilities.

Supply chain human rights risks

RHI Magnesita's diverse and global upstream supply chain presents risks for supply chain workers, particularly in labour-intensive sectors like mining and manufacturing. The Global Slavery Index was used to identify countries with high risks of forced labour, such as India, North Korea, and Pakistan. Relevant value chain stakeholders for the Group are located in India.

The Group uses a risk-based approach to identify and monitor suppliers at risk, including EcoVadis assessments and on-site audits.

Interaction with business model and value chain

RHI Magnesita's vertically integrated value chain ranging from raw material sourcing to refractory production and performance-based solutions creates both opportunities and challenges:

Upstream: In 2024 the Group sourced internally 67% of its magnesite and dolomite raw material needs. Approximately 42% of raw materials are sourced from its own mines. Scope 3 emissions from purchased raw materials are significant due to the high CO2 intensity of raw material production. The Group's total Scope 3 emissions from purchased raw materials require ongoing monitoring and supplier engagement.

Core operations: The Group manufactures refractory products at production sites globally. Key impacts include Scope 1 emissions from fuel consumption and geogenic process emissions, emissions to air (NOx, SOx, CO, Hg, HFCs), and occupational health and safety risks.

Downstream: The Group's products enable decarbonisation in customer industries, particularly through EAF refractories for low-carbon steelmaking. The Group also provides solutions and services to customers to reduce their GHG emissions, including digital solutions and advanced refractory products.

Resilience considerations

The Group has assessed its resilience to identified material IROs:

Climate transition resilience: The Group has adopted a theoretical decarbonisation pathway that is not aligned with a 1.5-degree scenario as set out in the Paris agreement. A detailed assessment was carried out in 2021 and 2022 of all possible measures to reduce CO2 emissions based on proven technology and available financial resources. The Board concluded that whilst it may be possible to reduce emissions in line with a 'well below 2 degrees' scenario, it would not be possible to set a target that is aligned with a 1.5-degree scenario.

The Group is actively seeking to adapt its strategy and business model to reduce its Scope 1 CO2 emissions in Europe, to minimise potential future financial impact from CBAM. Higher expected future emissions costs are a key driver behind the Group's strategic decision to invest in CO2 emissions reduction initiatives.

Physical climate risks: The Group conducted physical climate risk assessments in 2023 and 2024. The findings indicate that the Group's overall exposure to physical climate risks remains limited, primarily due to the lack of immediate threats at most flagged sites and the Group's proactive risk management approach.

Capacity considerations: Given the safeguards that the Group has in place, no material financial effect from forced labour risk is expected in the next reporting period, 2025, or in the medium to long-term. The Group has sufficient capacity to continue to address this risk in its own workforce and supply chain.

For health and safety, given the safeguards that the Group has in place, no material financial effect from this risk is expected in the next reporting period, 2025, or in the medium to long-term. The Group has sufficient capacity to continue to address this risk in its own workforce.

DMA methodology and validation

For impact materiality, 92 matters were assessed. Of these, 12 were classified above the materiality threshold. For financial materiality, 60 matters were assessed. Of these, eight were classified above the materiality threshold and one was added as a result of the stakeholder validation process.

The assessment results were presented to management and subsequently reviewed by the joint meeting of the Corporate Sustainability and Audit & Compliance Committees on behalf of the Board of Directors.

RHI Magnesita conducted consultations with internal and external stakeholders (employees, investors, suppliers, customers, NGOs, lenders, members of Board) for validation and perceived materiality.

A regular review of the scope of the DMA is expected, to remain responsive to the evolving regulatory environment and/or the Group goes through significant changes in its industrial footprint (e.g. M&A).

Description of the process to identify and assess material impacts, risks and opportunities

Overview of the Double Materiality Assessment Process

RHI Magnesita has assessed material sustainability related impacts, risks and opportunities according to the ESRS concept and requirements of double materiality. The assessment results were presented to management and subsequently reviewed by the joint meeting of the Corporate Sustainability and Audit & Compliance Committees on behalf of the Board of Directors.

Refractory production is a hard-to-abate industry characterised by energy-intensive processes, high-temperature operations, and reliance on fossil fuels, leading to significant carbon emissions, including process emissions from raw material calcination and fuel combustion at raw material processing sites. The impact is exacerbated by rising global demand, particularly in emerging markets, and the inherent challenges of decarbonisation due to technological limitations (e.g., achieving high temperatures with renewable energy), long investment cycles, and substantial transition costs. To address these emissions, the Group is actively pursuing and evaluating solutions such as carbon capture, utilisation, and storage ("CCUS"), electrification, green hydrogen, energy efficiency enhancements, and the integration of low-carbon materials into its operations.

Preparation Phase

To prepare for the DMA, RHI Magnesita conducted a comprehensive evaluation of its business model and activities across the value chain. This included a detailed analysis of the granularity of impact risks and opportunities (IROs) within the Group, ensuring a thorough understanding of their specific implications. This process was aimed at identifying key areas of significance, refining the scope of material issues, and aligning them with the Group's strategic priorities. This process was guided by the list of sustainability matters outlined in the topical ESRS and facilitated the identification of key stakeholders.

Additionally, RHI Magnesita also made use of performance data, literature review, ESG public databases, current and upcoming regulations and standards, industry sector benchmarking and external experts to support the materiality assessment. RHI Magnesita has previously carried out materiality and risk assessments for GRI reporting and TCFD analysis.

The evaluation of potential GHG emissions has been conducted with a focus on the distinct contributions from raw material preparation plants and refractory production facilities. This analysis accounts for variations in energy and fuel mixes across operations, as well as the specific carbon intensity of each process. Raw material preparation plants, due to energy-intensive activities such as calcination and material processing, have been assessed separately to highlight their unique emission profiles. Similarly, emissions from refractory production have been analysed, with particular attention to kiln operations, fuel combustion, and electricity consumption. Additionally, the type and sourcing of raw materials have been considered, given their significant impact on the overall emissions footprint. This approach ensures a comprehensive understanding of source of emissions across the value chain and highlights key areas for targeted mitigation efforts.

Stakeholder Engagement

The assessment process incorporated input and validation from key stakeholders, including subject matter experts from group functions in health and safety, environment, equality, diversity and inclusion, community engagement, sustainable procurement, compliance, and risk management. Additionally, contributions from the sustainability functions in corporate areas were integral to ensuring a holistic perspective. Involvement of the risk management resources in the materiality assessment process supports the identification and further evaluation of sustainability related impacts, risks and opportunities. There are no additional internal controls for the DMA.

Impact Materiality Assessment

The impact materiality assessment considered both actual and potential sustainability impacts from RHI Magnesita's own activities and business relationships across the upstream and downstream value chain, focusing on high-risk areas such as mining and production processes, as well as relevant processes and influencing factors. Where applicable, industry-specific issues were also integrated into the evaluation to ensure a tailored approach.

The following steps were taken for the impact materiality assessment:

• Identification of impacts
• Scoping and classification of individual impacts
• Assessment of significance of individual impacts
• Analysis of results and materiality thresholds
• Perception and Validation of DMA Outcomes by stakeholders

Identification of impacts

RHI Magnesita has identified its impacts across the value chain by examining sustainability matters at varying levels of granularity, including topics, sub-topics, and sub-sub-topics. This analysis considered the direct and indirect consequences of RHI Magnesita's operations, products, and services on environmental, social, and governance aspects. By aligning with the detailed structure provided by the ESRS, the assessment captured specific nuances of each sustainability matter, ensuring a thorough understanding of the scale, scope, and depth of RHI Magnesita's impacts at every stage of the value chain. This approach enabled the identification of both significant adverse effects and opportunities for positive contributions to people and environment.

Scoping and classification of individual impacts

As a next step, a detailed analysis of each identified impact, considering its classification along the value chain to pinpoint where it occurs, and its significance was carried out. Impacts were classified as positive or negative and assessed further to determine whether they are actual (already occurring) or potential (likely to occur in the future). Each impact was also evaluated based on its time frame - whether it is short, medium, or long-term - and the probability of its occurrence, enabling a thorough understanding of the likelihood and urgency of the impact. This approach ensures a comprehensive assessment of sustainability impacts across RHI Magnesita's operations and value chain.

Assessment of significance of individual impacts

To assess the significance of impacts, RHI Magnesita followed the ESRS methodology, incorporating a comprehensive evaluation of scale, scope, remediability, and likelihood. Scale measures the magnitude of the impact, while scope evaluates its breadth across stakeholders and the value chain. Remediability considers the feasibility and timeframe to reverse or mitigate a negative impact, and likelihood assesses the probability of the impact occurring. Each dimension is rated on a scale from 0 to 6, with 6 representing the highest level of impact. This evaluation integrates both quantitative data, such as metrics and indicators, and qualitative insights, including expert opinions and stakeholder feedback. Additionally, potential impacts are analysed with a focus on their probability of occurrence, granularity, and time horizon, ensuring a balanced assessment.

Analysis of results and materiality thresholds

The analysis of results and materiality thresholds play a critical role in determining which issues are to be included in RHI Magnesita's sustainability reporting. Materiality thresholds were carefully evaluated for reasonableness to ensure a balance between comprehensiveness and manageability, ensuring that resources are focused on critical areas without diluting efforts across too many topics while meeting reporting obligations effectively. Both quantitative (e.g. numerical scoring) and qualitative thresholds (e.g., legal compliance, reputational risk) were utilised, with alignment to Group targets shaping final decisions. Different quantitative thresholds were tested to refine the results.

Financial Materiality Assessment

Financial materiality is evaluated based on the potential risks of negative reputational, financial, or commercial impacts on RHI Magnesita arising from sustainability topics, as well as the opportunities linked to sustainability that could benefit RHI Magnesita. The following steps were taken for the financial materiality:

• Gap analysis
• Risk mapping against CSRS topics, subtopics and sub-subtopics
• Assessment based on RHI Magnesita's internal risk assessment approach
• Analysis of results and materiality thresholds
• Perception and Validation of DMA Outcomes by stakeholders

Gap analysis

The gap analysis of financial materiality involves a thorough review of existing risks to assess their alignment with RHI Magnesita's strategy and sustainability goals. This process includes identifying any emerging risks that may pose reputational, financial, or operational challenges and evaluating their potential impact on the Group. Simultaneously, the analysis explores untapped opportunities that align with RHI Magnesita's strategy, enabling the integration of sustainability-driven initiatives into the business strategy.

Risk mapping against ESRS topics

As part of the risk mapping process, ESG risks and opportunities were aligned with their corresponding topics within the ESRS framework. By doing so, RHI Magnesita ensured that highly rated impacts identified in the materiality analysis are adequately reflected as risks or opportunities within the ESRS universe, providing a cohesive and comprehensive integration of sustainability considerations into risk management and reporting practices.

Risk and opportunity assessment following RHI Magnesita's risk management approach

The assessment of risks and opportunities has followed RHI Magnesita's internal risk assessment methodology, ensuring alignment with the Group's established approach to evaluating potential impacts. The analysis incorporates a time horizon perspective, considering short-, medium-, and long-term implications for the business. This comprehensive evaluation enables the identification and prioritisation of risks and opportunities, ensuring that immediate concerns, emerging trends, and long-range strategic impacts are thoroughly addressed within the sustainability context.

Analysis of results and materiality thresholds

The analysis of results and materiality thresholds is key in identifying which issues are significant enough to be included in RHI Magnesita's sustainability reporting. These thresholds were assessed to ensure a balance between comprehensiveness and focus, allowing resources to be directed toward critical risks and opportunities while maintaining effective reporting. Both quantitative thresholds (e.g., numerical scoring) and qualitative criteria (e.g., legal compliance, reputational risk) were applied, with alignment to Group targets guiding final decisions. Various quantitative thresholds were tested to refine the analysis, ensuring the prioritisation of material issues. For financial materiality, RHI Magnesita will focus on critical areas where the likelihood and impact of risks or opportunities materialising are significant. However, not all sustainability related risks in the Consolidated Sustainability Statement are specifically highlighted in RHI Magnesita's aggregate risk profile.

Results

For impact materiality, 92 matters were assessed. Of these, 12 were classified above the materiality threshold. For financial materiality, 60 matters were assessed. Of these, eight were classified above the materiality threshold and one was added as a result of the stakeholder validation process.

Stakeholder perception and validation of Double Materiality Assessment ("DMA") results

RHI Magnesita conducted consultations with internal and external stakeholders (employees, investors, suppliers, customers, NGOs, lenders, members of Board) for validation and perceived materiality.

The views of RHI Magnesita's stakeholders are integrated in the materiality assessment. RHI Magnesita's Group functions and business areas summarise input provided to them through their engagement with affected stakeholders, and their interaction with external sustainability experts and users of RHI Magnesita's Consolidated Sustainability Statement.

Frequency of Review

A regular review of the scope of the DMA is expected, to remain responsive to the evolving regulatory environment and/or the Group goes through significant changes in its industrial footprint (e.g. M&A).

Scoring Methodology Summary

Impact Materiality:

• Scale, scope, remediability, and likelihood assessed
• Each dimension rated on a scale from 0 to 6, with 6 representing the highest level of impact
• Integrates quantitative metrics and qualitative insights

Financial Materiality:

• RHI Magnesita assesses its sustainability risks and opportunities according to the ESRS methodology seen as the same methodology used in preparation of the Group's general risk ledger
• For each risk and opportunity, likelihood and potential impact (i.e. financial materiality) were measured on a scale of 1-5 with resulting scores multiplied together to reach an overall materiality score with a maximum of 25

ESRS Coverage: RHI Magnesita has produced a Sustainability Statement according to ESRS for the 2024 financial year. Having completed a lengthy double materiality assessment and complied in full with the disclosure requirements, the Group notes that the ESRS process places an unreasonable burden in terms of financial cost and other corporate resources. The Group is of the view that the outcome of the ESRS process is not beneficial to stakeholders and urges relevant regulators to look again at the implementation.

The European Commission has proposed a revision to ESRS through its Omnibus Directive and the Group hopes for improvement. The specific ESRS topics covered would be detailed in the Sustainability Statement (pages 64-172).

Transition plan for climate change mitigation

Scope of the transition plan

The decarbonisation pathway covers:

• Entities: RHI Magnesita's core operations globally across all five regions (Europe, Asia, NAM, SAM, MEA)
• Value chain segments: Direct operations (Scope 1), purchased electricity (Scope 2), and upstream purchased raw materials (Scope 3)
• Geography: Global production network, with priority implementation starting in Europe and subsequently in all regions

The transition plan addresses direct emissions from fuel combustion and geogenic process emissions (MgCO₃ calcined to MgO + CO₂) in raw material processing, as well as emissions from purchased raw materials (Scope 3), which together account for over half of the Group's total CO₂ footprint.

Target year(s) for net zero / carbon neutral

2060: The Group has published a theoretical decarbonisation pathway which sets out a potential route to substantially remove all CO₂ emissions by 2060.

Alignment status: The decarbonisation pathway is not aligned with a 1.5-degree scenario but is aligned with a 'well below 2.0 degrees' scenario. The Group explicitly states: "Currently, there are no plans to adjust the business model or strategy to align with this framework."

The Group notes: "Each year, the Group systematically reviews and evaluates all viable measures to reduce CO₂ emissions across its operations, prioritising proven technologies and aligning with available financial resources. While achieving emission reductions consistent with a 'well below 2 degrees' scenario appears feasible, our current assessment indicates that setting a target aligned with a 1.5-degree scenario is not achievable without the advancement of currently unavailable technologies or substantial external financial and infrastructure support."

Scope 1, 2, 3 reduction milestones with baseline years

2025 Target (baseline year: 2018)

• Integrated target: 15% reduction in Scope 1, 2, 3 (purchased raw materials) CO₂ emissions intensity per tonne of product
• 2024 progress: 14% reduction achieved

2030 Target (baseline year: 2024)

• Integrated target: 10% reduction in CO₂ emissions per tonne of product (Scope 1, 2, and 3 raw materials)
• Scope 1: 9% reduction
• Scope 2: 5% reduction (market-based)
• Scope 3 (raw materials): 12% reduction
• Coverage: Approximately 4.5 million tonnes CO₂ (75% of total Scope 1, 2 and 3 emissions)

Absolute emissions trajectory:

Relative emissions trajectory:

2035 estimate: Approximately 1.5 million tonnes of CO₂ absolute reduction (24% of baseline total) through measures deliverable without significant external support.

Alignment with 1.5°C / SBTi validation status

Not aligned with 1.5°C: The Group explicitly states its targets are not compatible with limiting global warming to 1.5°C.

SBTi comparison:

The Group states: "The reference 1.5°C reduction for the target period 2024 to 2030 would be a reduction of 42% of Scope 1 and 2 emissions while the Group targets an 9% reduction of Scope 1 and 5% reduction for Scope 2 emissions. For Scope 3 emissions a 1.5°C reduction target would require a reduction of 42% and the Group's targeted reduction of Scope 3 from purchased raw materials by 12%. Therefore, the Group's CO₂ reduction targets are not compatible with limiting global warming to 1.5°C."

Rationale: "The Group is not excluded from the EU Paris-aligned Benchmarks in accordance with Commission Delegated Regulation (EU) 2020/1818." However, management states that a detailed assessment in 2021 and 2022 concluded that achieving a 1.5-degree aligned target "would be dependent on the development of as-yet-unknown technologies or reliant on significant external financial and infrastructure support which are uncertain."

Key levers / decarbonization pillars

Main reduction levers and expected contribution to 2030 target:

1. Secondary raw materials (Recycling)

• Target: Increase use to 15% by 2025 (from 14.2% in 2024, 12.6% in 2023)
• Impact: Estimated CO₂ reduction of 1.6 tonnes per tonne of secondary raw material used
• Joint venture: MIRECO with Horn & Co. combines recycling activities in Europe
• Contribution to 2030 target: 41% (185,300 tCO₂)
• Natural ceiling: Refractories are consumed during use and only residual materials can be reclaimed

2. Energy efficiency

• 2025 target: 5% reduction in energy intensity per tonne of product (baseline: 2018)
• 2024 progress: 7% reduction achieved vs. baseline
• 2030 target: 1% improvement per plant annually (baseline: 2024)
• 2024 contribution: Approximately 15,000 t CO₂ reduction
• Expected 2030 contribution: 2% (9,000 tCO₂)
• Approach: Based on implemented projects aligned with ISO 50001 standards

3. Fuel switching

• Primary approach: Transition from petroleum coke to natural gas
• Status: Plans in Europe postponed due to delays in natural gas pipeline construction
• Brazil: Successfully switched from petroleum coke to sustainably sourced charcoal at Ponte Alta site
• USA: York plant in Pennsylvania assessing transition from petcoke to natural gas (no economically viable solution identified yet)
• Expected 2030 contribution: 35% (158,200 tCO₂)
• Limitation: Fuel switches to natural gas only offer partial reduction

4. Renewable electricity

• Current status: Most electricity consumption in Europe and South America is from renewable sources
• China: Increasing share of green electricity; 2.2 MW PV panels installed at Dalian operations in 2024
• Approach: Combination of self-generated clean power (on-site solar) and power purchase agreements with certified clean energy providers
• Expected savings: Up to €2 million annual operating cost saving once implemented
• Timeline: 2025-2026 implementation
• Expected 2030 contribution: 1% (4,500 tCO₂)

5. Supplier decarbonisation

• Expected 2030 contribution: 21% (95,000 tCO₂)
• Approach: Working with suppliers of raw materials to reduce or eliminate their CO₂ emissions

6. Carbon capture and utilisation (CCU)

• Partnership: MCi Carbon to develop technologies focused on direct mineralisation of CO₂ from flue gases
• Process: Efficiently transforms gaseous waste CO₂ into solid mineral
• Pilot facility: Newcastle, Australia
• Timeline: Testing and development programmes continue until mid-2025
• Other technologies: Research includes cryogenic, chemical separation, and membrane-based techniques
• Partnership: Compact Membrane Systems for pilot schemes

7. Alternative fuels (hydrogen and biofuels)

• Hydrogen: Proof of concept achieved; no further significant investments required until economic source of clean hydrogen becomes available
• Status: Securing reliable and economic supply of green hydrogen is essential pre-cursor to large-scale adoption
• Biofuels: Exploring options including charcoal (Brazil) and sunflower husks (testing ongoing)
• Dependency: Local availability and cost competitiveness

CapEx / investment commitments

2024 investments

• Total CO₂ reduction CapEx: €7.3 million
• Breakdown:
  • Recycling investments (EU Taxonomy-aligned): €3.9 million
  • Fuel switching investments
  • Hydrogen-related production route trials
• EU Taxonomy-aligned activity: Material recovery from non-hazardous waste/sorting and material recovery of non-hazardous waste

Future investment requirements

• Full decarbonisation estimate: Approximately €1 billion
• 2024 free cash flow: €225 million (allocated to M&A, organic capex, maintenance and dividends)
• Near-term expectation: Future financial resources projected to remain at levels comparable to 2024
• Implementation period: 2025 and beyond expected to require similar CO₂-target-related OpEx and CapEx
• Funding challenge: "At current levels of cash generation and considering competing demands for capital it is unlikely that the Group would be able to fund a full decarbonisation of its operations from internally generated cash flow."
• External funding: May be possible in the form of subsidies or co-investment in specific projects
• Payback limitation: "Since there is no payback outside of jurisdictions where an ETS imposes a cost of carbon emissions, there is a limit to the amount of capital that the Group can commit to decarbonisation."

Tax implications: The Group is not engaged in fossil-fuel related economic activities beyond using natural gas, pet coke, coal and oil as fuels in its production processes.

Locked-in emissions and stranded asset analysis

Locked-in emissions

"The vast majority of direct emissions at RHI Magnesita result from firing at high temperature of various kilns and geogenic emissions from carbonate raw materials during firing."

Geogenic emissions: "In the burning process, around 50% of the weight of the mineral is converted into CO₂, resulting in geogenic emissions." These are classified as Scope 1 when from own production or Scope 3 for externally purchased raw materials. Together they account for "over half our total CO₂ footprint."

Assessment: "We do not expect that the locked-in emissions jeopardise the undertaking's GHG emission 2030 target. For a comprehensive decarbonisation beyond the Group's 2030 target locked-in emissions require a market environment which allows the Group to pass on higher costs of carbon-neutral fuels and carbon capture and utilisation."

Requirements for abatement:

• Carbon-neutral fuels such as hydrogen
• Carbon capture for geogenic emissions which are otherwise unavoidable
• Market environment allowing cost pass-through

Asset impairment considerations

The Group has conducted scenario analysis including:

• Paris-aligned mitigation scenario (RCP 2.6): Strengthened climate policies limiting warming to below two degrees
• Hot-house world scenario (RCP 8.5): Inadequate mitigation, leading to three to four degrees of warming

CBAM impact assessment: "In absence of any mitigating action by management, the gross profit could reduce by 31% from 2030, on average across the EU assets, of which 24% would be offset in regions outside the EU in a scenario where the impact of a production shift from Europe to regions outside Europe due to additional carbon tax is analysed in isolation. This scenario would not cause impairment losses for the respective CGUs in their current state due to sufficient headroom."

Useful lives: "Management has assessed the useful lives of property, plant and equipment and these continue to be appropriate due to the limited refractory and other product alternatives available and considering that the customer industries that the Group serves, continue to play a significant part in the transition towards sustainable output and the transition to a green economy."

Terminal value assumptions: "In the terminal value, these CO₂ emission costs are recognised at the same level as assumed in the last year of the Long-Term Plan. Due to planning uncertainty inherent in the Group's climate transition phase which includes the extent to which CBAM will be relevant to the Group's operations, no additional carbon emission costs have been included in the terminal value; that is to say, the phasing out of the free CO₂ emission allowances is not included."

Complete decarbonisation investments: "At present, neither the investments needed to achieve complete decarbonisation, nor their potential positive effects have been included in the value in use determination since the Group has not committed to complete decarbonisation and alternatives to complete decarbonisation exist."

Use of carbon credits / removals

Policy position: "The Group has significant CO₂ emissions within its own value chain and there are large emissions savings that can be delivered for its customers through improved solutions contracts or other solutions. The Board therefore considers that the priority should be to allocate capital and other resources to reducing the Group's own CO₂ footprint and the emissions of its customers rather than investing in carbon offset projects. The Board believes that taking this approach will deliver a faster, greater and more sustainable decrease in net CO₂ emissions than could be delivered by allocating capital to offsets."

Carbon sinks: "Potentially existing carbon sinks are forests owned by the Group but are at the moment not considered."

No carbon credits used: The Group does not currently use carbon credits or removals as part of its transition plan.

Governance and accountability

• Board approval: The decarbonisation pathway has been approved by the Board, the Corporate Social Responsibility Committee (CSC) and the Executive Management Team
• Accountability: The CTO is accountable for implementation of the IMS policy which addresses climate change mitigation
• Annual review: "We are committed to reducing our carbon footprint and we will continue to monitor the variables which support this conclusion and update our decarbonisation pathway based on technology, infrastructure and capex developments."

Commitments

RHI Magnesita's decarbonisation commitment:

• Lead the refractory industry by decarbonising operations as fast as sustainably possible
• Annually update decarbonisation pathway based on technology, infrastructure and capex developments
• Invest in R&D of new technologies to avoid or capture CO₂ emissions
• Offer customers enabling technologies or solutions for their own low-carbon production technologies and low-carbon refractory products to reduce their Scope 3 emissions
• Lobby governments to invest in infrastructure to support decarbonisation
• Work with partners in the private sector to develop new solutions for decarbonisation

Uncertainties and dependencies

"Actual delivery of decarbonisation pathway is uncertain due to reliance on as yet unproven technologies, infrastructure, energy sources and the actions of suppliers and governments which are not under the control of management."

Key dependencies beyond 2035:

1. Provision of new infrastructure or renewable energy sources such as hydrogen by outside parties
2. Use of technologies which do not yet exist or are not proven at pilot or production scale
3. Significant capital expenditure, which may not be possible for the Group to generate from existing operations, obtain from finance providers or receive via government funding

Regulatory considerations: "The Group has a global production and customer network and competes with other refractory producers who are not subject to additional CO₂ costs."

Policies related to climate change mitigation and adaptation

RHI Magnesita has disclosed one overarching policy addressing climate change mitigation:

Integrated Management System Policy (IMS Policy)

Key content and principles:

• Commits to tackling climate change as far as it is technically and economically feasible
• Strives to minimise direct and indirect CO2 and other greenhouse gas emissions
• Focuses on improving energy efficiency of operations
• Promotes the use of cleaner energy sources
• Commits to operating all business activities in a sustainable way to ensure environmental protection and tackling climate change
• Aims to minimise environmental impacts of operations as far as technically and economically feasible

Scope:

• Applies to RHI Magnesita N.V. and all Group companies
• Applies to all employees
• Limited to Group companies and employees; does not extend to the upstream or downstream value chain
• Globally applicable and does not specifically address or exclude stakeholder groups

Governance and oversight:

• The CTO (Chief Technology Officer) is accountable for the implementation of the policy

Public availability:

• Published on RHI Magnesita's website

Links to international standards:

• The IMS policy does not refer to any third-party standard

Monitoring implementation:

• Not disclosed

Related policy

The Supplier Code of Conduct includes references to environmental compliance and other sustainability priorities and is aimed at the Group's upstream value chain, though it is not specifically a climate policy.

Additional frameworks

The Corporate Risk-Taking/Management Policy outlines structured processes for identifying and managing risks across the organisation, including climate-related risks and opportunities integrated into the broader corporate risk management framework.

Policy gaps and planned updates

The company acknowledges that:

• The current IMS policy does not explicitly address renewable energy or climate change adaptation
• The Group's current policy does not yet fully align with all ESRS disclosure requirements
• An update is underway to ensure compliance and comprehensive reporting
• Rather than implementing separate policies for individual risks (such as climate adaptation), the Group relies on its comprehensive risk framework

Actions and resources in relation to climate change policies

Key Actions Overview

RHI Magnesita has set time-bound targets to reduce its GHG-footprint through continuous actions focused on:

• Increasing the use of secondary raw materials
• Increasing energy efficiency
• Switching to renewable electricity and less CO2-intensive fuels

Scope: Direct Scope 1, Scope 2 market-based and Scope 3 emissions from purchased raw materials, covering the Group's direct operations in all regions.

1. Increased Use of Secondary Raw Materials (Recycling)

Description:

• Key action to achieve CO2 reduction target
• Target: 15% recycling rate by 2025 (achieved 14.2% in 2024, up from 12.6% in 2023)
• Previously achieved 10% recycling target
• Every tonne of secondary raw material replaces virgin raw material with average CO2-intensity of 1.6t CO2 per tonne

Actions include:

• Improved recipes and processes allowing higher shares of circular raw materials
• Sales activities aiming at sale of brands with higher circular raw materials share
• Investments in operations to improve capacity to process circular raw materials

Time horizon: Continuous, short-term and ongoing

Resources allocated:

• Investments in increased recycling capabilities are continuous effort
• Part of asset category 'Plant Property & Equipment'
• Approximately €3.9 million in 2024 relates to recycling investments according to EU Taxonomy (Material recovery from non-hazardous waste/sorting and material recovery of non-hazardous waste)

Expected outcomes:

• Estimated absolute reduction of around 1.5 million tonnes of CO2 emissions by 2035 (24% of baseline total through combined measures including recycling, fuel switches and energy efficiency)

Link to policy/target: Contributes to policy objective to minimise direct and indirect CO2 and other greenhouse gas emissions; supports 2030 CO2 reduction target

2. Energy Efficiency Measures

Description:

• Aim to reduce energy intensity by 1% per year
• Implementation of various energy efficiency projects

Time horizon: Continuous, short-term and ongoing

Resources allocated:

• Part of overall €7.3 million invested in 2024 to reduce CO2 emissions

Expected outcomes:

• In 2024, energy efficiency measures contributed to emission reduction of around 15,000 t CO2

Link to policy/target: Supports 2030 CO2 reduction target and policy to minimise GHG emissions

3. Fuel Switching to Natural Gas

Description:

• Switch from petroleum coke to natural gas at Hochfilzen plant (Europe)
• Increased use of waste and biofuels in kilns

Time horizon: Switch at Hochfilzen plant planned for 2025

Resources allocated:

• Part of overall €7.3 million invested in 2024

Expected outcomes:

• CO2 reduction lever contributing to overall emissions reduction target

Link to policy/target: Supports climate change mitigation policy and 2030 reduction target

4. Switch to Renewable Electricity

Description:

• Switch to green electricity where feasible
• Most electricity consumption in Europe and South America is from renewable sources
• Increasing share of green electricity consumed in China
• Installation of PV panels at several plants in China and India

Specific projects:

• 2.2 MW PV panels installed in 2024 in Dalian operations, China

Time horizon: Short-term and ongoing

Resources allocated:

• Part of overall €7.3 million invested in 2024

Link to policy/target: Contributes to reducing Scope 2 emissions and overall climate mitigation policy

5. Use of Biofuels

Description:

• RHI Magnesita uses charcoal in Brazil (considered as biofuel)
• Ongoing tests with sunflower husks

Time horizon: Ongoing testing and implementation

Link to policy/target: Alternative fuel exploration to reduce fossil fuel dependency

6. Trialling Recycled Materials in Raw Material Plants

Description:

• Trialled the use of recycled materials within raw material plants, displacing geogenic process emissions

Scope: Own operations, specifically raw material production in Europe

Link to policy/target: Reduces Scope 1 geogenic process emissions

7. Carbon Capture and Utilisation (CCU)

Description:

• Evaluation of technologies for CO2 capture at raw material production sites
• Research of potential technology solutions including cryogenic, chemical separation, and membrane-based techniques
• Partnership with MCi Carbon to develop technologies for direct mineralisation of CO2 from flue gases

Specific projects:

• Construction of pilot facility in Newcastle, Australia (2024)
• Testing and development programmes with MCi Carbon set to continue until mid-2025

Time horizon: Medium to long-term (pilot testing through mid-2025)

Resources allocated:

• Financial resources included in overall R&D and climate action budget (specific amounts not separately disclosed)

Expected outcomes:

• Process to efficiently transform gaseous waste CO2 into solid mineral
• Potential for utilisation in other industries (e.g., cement sector)

Link to policy/target: Long-term decarbonisation pathway; requires significant capital expenditure and external support

8. Hydrogen as Alternative Fuel

Description:

• Exploration of hydrogen produced using renewable energy for high-temperature industrial processes
• Proof of concept has been achieved

Time horizon: Long-term; dependent on availability of economic clean hydrogen supply

Resources allocated:

• Part of €7.3 million invested in 2024 includes hydrogen-related production route trials
• No further significant investments required until economic source of clean hydrogen becomes available

Link to policy/target: Long-term decarbonisation pathway for Scope 1 emissions

9. CO2 Hedging Strategy

Description:

• Hedging strategy for future CO2 costs to improve cost visibility in Europe
• CO2 certificate purchasing costs: €6 million in 2024 (2023: €2 million)
• Average CO2 certificate cost in 2024: €59.30

Link to policy/target: Risk management related to carbon pricing; provides business case for reducing emissions

10. Production Network Optimisation

Description:

• Reassessment of production and logistics needs following acquisitions in 2022, 2023 and addition of Resco in 2025
• Potential adjustments including closure or downsizing of plants in regions currently net exporters
• Improve competitiveness through local-for-local production where beneficial
• Increase domestic US production following Resco acquisition
• €29 million write-down of expenditure previously invested to increase output in Brazil for export to North America

Time horizon: Short to medium-term (ongoing assessment)

Expected outcomes:

• Longer-term efficiency gains
• Reduced freight and associated emissions
• May incur short-term restructuring costs

Link to policy/target: Supports efficiency and indirectly supports emissions reduction through optimised logistics

Overall Financial Resources

2024 Investments:

• Total Capex invested to reduce CO2 emissions: €7.3 million
  • Approximately €3.9 million relates to recycling investments (EU Taxonomy eligible)
  • Remainder includes investments to switch to more CO2-efficient fuels and trial hydrogen-related production routes
• Reported in Financial Statements Note 19 (Property, plant and equipment) under 'Additions'

Future Resources:

• Future financial resources projected to remain at levels comparable to 2024
• Implementation of actions to achieve 2030 CO2 reduction target depends on annual capex in same order of magnitude as reporting year
• No additional availability and allocation of resources required beyond current levels for near-term actions

Long-term Resources:

• Full decarbonisation will require significant capital expenditure, starting in Europe and subsequently in all regions
• Long-term pathway depends on:
  • New infrastructure or renewable energy sources (e.g., hydrogen) by outside parties
  • Technologies not yet proven at pilot or production scale
  • Significant capital expenditure that may not be possible to generate from existing operations, obtain from finance providers, or receive via government funding

OpEx:

• For 2025 and beyond, Group expects similar CO2-target-related OpEx and Capex to implement actions along main reduction levers
• Current and future financial resources (OpEx) disclosed separately in metrics tables

Implementation Approach

• Ability to implement actions does not depend on specific preconditions
• Group does not use any sustainable finance instruments to enable its decarbonisation action
• Annual capex expected to continue at similar levels
• No taxonomy/ESRS disclosure alignment issues noted for core climate actions

Targets related to climate change mitigation and adaptation

CO₂ Emissions Reduction Targets

2025 Target (Scope 1, 2, 3 purchased raw materials)

• Metric: CO₂ emissions intensity (tCO₂e per tonne of product)
• Target: 15% reduction
• Target Year: 2025
• Baseline Year: 2018
• Baseline Value: 1.82 tCO₂e/tonne
• Target Value: 1.55 tCO₂e/tonne
• Scope: Scope 1, 2, and 3 (purchased raw materials) - all RHI Magnesita operations globally
• Type: Intensity-based target
• Validation: Not science-based, not SBTi validated; internal target based on bottom-up approach
• Progress (2024): 1.57 tCO₂e/tonne (14% reduction achieved vs. baseline)

2030 Target (Scope 1, 2, 3 purchased raw materials)

• Metric: CO₂ emissions intensity (tCO₂e per tonne of product)
• Target: 10% reduction
• Target Year: 2030
• Baseline Year: 2024
• Baseline Value: 1.57 tCO₂e/tonne
• Target Value: 1.41 tCO₂e/tonne
• Scope: Scope 1, 2, and 3 (purchased raw materials) - all RHI Magnesita operations globally; covers around 4.5 million tonnes CO₂ (75% of total Scope 1, 2 and 3 emissions)
• Type: Intensity-based target
• Validation: Not science-based, not SBTi validated; internal target based on bottom-up approach

2030 Target breakdown by Scope (absolute reductions):

• Scope 1: 9% reduction (from 2,250,000 tCO₂ in 2024 to 2,050,000 tCO₂ in 2030)
• Scope 2: 5% reduction (from 99,000 tCO₂ in 2024 to 94,000 tCO₂ in 2030, market-based)
• Scope 3 (raw materials): 12% reduction (from 2,058,000 tCO₂ in 2024 to 1,811,000 tCO₂ in 2030)

2030 Target - Reduction Levers:

Energy Efficiency Targets

2025 Energy Efficiency Target

• Metric: Energy consumption intensity per tonne of product
• Target: 5% reduction
• Target Year: 2025
• Baseline Year: 2018
• Baseline Value: 1.91 (adjusted for M&A)
• Target Value: 1.82
• Scope: All direct energy consumption at RHI Magnesita's production sites globally (excluding resale and sale of raw magnesite and dolomite)
• Type: Intensity-based target
• Validation: Not science-based, not externally verified
• Progress (2024): 1.78 (7% reduction achieved vs. baseline; 2% increase vs. 2023)

2030 Energy Efficiency Target

• Metric: Energy efficiency improvement per plant
• Target: 1% improvement per plant annually
• Target Year: 2030
• Baseline Year: 2024
• Scope: All production sites
• Type: Relative target
• Validation: Not science-based, not externally verified

Recycling / Secondary Raw Materials Target

2025 Target

• Metric: Share of secondary raw materials (SRM) content in refractories
• Target: 15%
• Target Year: 2025
• Baseline Year: 2018
• Baseline Value: 3.8%
• Scope: Refractory and metallurgical product operations
• Type: Intensity-based (percentage)
• Validation: Internal target
• Progress (2024): 14.2%

2030 Target

• Metric: Share of secondary raw materials in products
• Target: 20%
• Target Year: 2030
• Scope: Refractory and metallurgical product operations, covering upstream and downstream value chains
• Type: Relative target
• Validation: Internal target

ISO 50001 Coverage Target

• Metric: Coverage of plants by ISO 50001 standards
• Target: 90%
• Target Year: 2030
• Scope: All production plants

Science-based Alignment

The Group's targets are not compatible with limiting global warming to 1.5°C. The reference 1.5°C reduction for 2024-2030 would require:

• Scope 1 and 2: 42% reduction
• Scope 3: 42% reduction

RHI Magnesita's actual targets for 2024-2030:

• Scope 1: 9% reduction
• Scope 2: 5% reduction
• Scope 3 (purchased raw materials): 12% reduction

Energy consumption and mix

RHI Magnesita operates entirely within high climate impact sectors, meaning total revenue is fully classified as revenue from these sectors. The Group's energy production includes 853 MWh from non-renewable sources and 1,250 MWh from renewable sources.

Energy consumption by source (2024 and 2023)

Scope and methodology: Total energy consumption includes self-generated electricity from renewable sources. Electricity from fossil sources is calculated on a location-based approach. Non-renewable energy generation (853 MWh) is estimated based on fuel inputs to electricity generators with an estimated conversion efficiency of 36% and is not included in total energy consumption to avoid double counting.

Energy consumption of purchased electricity from fossil sources

Energy intensity per net revenue

Connectivity: Net revenue used to calculate energy intensity is EUR 3,487,000,000 (aligned with financial statements).

Disaggregation of self-generated energy

Gross Scopes 1, 2, 3 and Total GHG emissions

Disclosure requirement E1-6 – Gross Scopes 1, 2, 3 and total GHG emissions

RHI Magnesita reports greenhouse gas emissions in accordance with the GHG Protocol Corporate Accounting and Reporting Standard. The reporting covers Scope 1, Scope 2 (location-based and market-based), and Scope 3 emissions for the year ended 31 December 2024.

Scope 1 emissions

Scope 1 direct GHG emissions for 2024 amounted to 2,257 kt CO₂eq (2023: 2,420 kt CO₂eq). The Group reports Scope 1 emissions disaggregated by source:

• Geogenic process emissions from raw material processing (calcination of magnesite and dolomite): 1,140 kt CO₂eq in 2024 (19% of total Group emissions).
• Fuel-based emissions from combustion of natural gas, oil, and petcoke at raw material and refractory production sites: 1,117 kt CO₂eq in 2024 (18% of total Group emissions).

Emission factors are applied to fuel consumption data or raw material processing quantities. The methodology has been subject to external review and refinement.

Scope 2 emissions

Scope 2 indirect GHG emissions from purchased energy are reported using both methodologies:

• Location-based: Not explicitly disclosed in the excerpts provided.
• Market-based: Included in the total CO₂ emissions reported. The Group purchases electricity and the market-based approach reflects contractual instruments where applicable.

Scope 2 emissions from energy consumption are stated as part of the total Scope 1, 2 and 3 reporting framework.

Scope 3 emissions

Scope 3 indirect GHG emissions from the value chain are calculated for selected categories:

The Group's Scope 3 emissions from purchased raw materials represented 35% of total Group CO₂ emissions in 2024 (2023: 37%). Scope 3 calculations rely on estimates of supplier emissions using the Group's knowledge of raw material production processes. Downstream Scope 3 includes transportation and direct use-phase emissions from refractory products.

Scope 3 exclusions: The Group does not report indirect use-phase emissions (i.e. emissions from customers' high-temperature industrial processes while using refractories, estimated at ~1.4 billion tonnes CO₂eq annually). Management concluded this guidance is not applicable as:

• No industry-specific guidelines exist for refractory producers.
• Significant estimation uncertainty and allocation challenges.
• RHI Magnesita has no control over these emissions, which are separately reported by customers.

Other Scope 3 categories (e.g. capital goods, business travel, employee commuting, waste, end-of-life) are not separately disclosed in the excerpts provided.

Total GHG emissions and intensity

The Group's 2025 target is to reduce CO₂ emissions intensity (Scope 1, 2, 3 raw materials) by 15% per tonne of product by 2025 versus the 2018 baseline of 1.82 t CO₂/t. The 2024 intensity of 1.57 represents a 14% reduction versus 2018.

For 2030, the target is a further 10% reduction in CO₂ intensity per tonne of product, to 1.41 t CO₂/t (versus 2024 baseline of 1.57).

Biogenic emissions

Biogenic CO₂ emissions from biofuels and additives are reported separately from Scope 1. The Group has increased the use of carbon-neutral alternative fuels (charcoal, biomass, waste) and is conducting biofuel co-firing trials. Specific biogenic emissions figures are not disclosed in the excerpts.

EU ETS and regulated emissions

RHI Magnesita is subject to the EU Emissions Trading Scheme (ETS). In 2024, the cost of purchasing CO₂ certificates for emissions above free allocation was €6 million (2023: €2 million). The percentage of Scope 1 emissions covered by regulated ETS is not explicitly stated. The Group expects rising costs due to CBAM implementation (2026–2034) and full removal of free allowances.

GHG intensity per net revenue

The Group uses CO₂ intensity per tonne of product as its primary metric (1.57 t CO₂/t in 2024). GHG intensity per net revenue is not disclosed in the excerpts provided.

Methodology and scope notes

• Emission factors: Applied to fuel consumption or raw material processing quantities. The methodology has been refined over several years with external review.
• Scope 3 estimation: Based on the Group's knowledge of supplier production processes. Accuracy cannot be guaranteed due to reliance on external data.
• Baseline adjustments: Minor corrections to plant emissions and energy data in 2023; acquisitions are integrated into baseline adjustments for targets.
• Uncertainty: CO₂ data is inherently based on assumptions and could be inaccurate. Other emissions (SOx, NOx) rely on periodic spot measurements and are not continuously monitored.
• Value chain coverage: Scope 3 includes purchased raw materials (upstream) and transportation and use-phase emissions (downstream). Indirect use-phase emissions from customer processes are excluded.
• Consolidation: The scope of reporting is fully aligned with financial consolidation at RHI Magnesita N.V. level, covering the Parent Company and all directly and indirectly controlled subsidiaries.

Summary table: Total GHG emissions by scope (2024)

Note: The excerpts do not provide a single consolidated table with all three scopes disaggregated. The above summary is reconstructed from narrative disclosures.

Internal carbon pricing

RHI Magnesita's production process is CO2 intensive and plants in Europe are required to purchase CO2 certificates under the EU Emissions Trading System (ETS).

RHI Magnesita operates a hedging strategy for future CO2 costs to manage the financial exposure associated with carbon pricing mechanisms.

The Group monitors the number of ETS certificates and ETS expenditures as entity-specific metrics to track the financial impact on operating and capital expenditures due to changes in policy and regulation. These metrics are not covered by specific ESRS disclosure requirements.

The Group's strategy includes engaging with carbon markets and implementing hedging strategies to mitigate cost volatility associated with carbon pricing. This forms part of the broader climate change mitigation approach, which includes:

• Monitoring and managing carbon allowance costs within the EU ETS framework
• Anticipating future costs under the Carbon Border Adjustment Mechanism (CBAM), expected to be implemented over the period 2026-2034
• Using recycled materials within raw material processing kilns to reduce geogenic emissions that would otherwise incur CO2 allowance costs

These internal carbon pricing considerations are integrated into the Group's capital allocation decisions and operational planning, particularly for facilities operating within emissions trading schemes.

Anticipated financial effects from material physical and transition risks and potential climate-related opportunities

Phase-in exemption

RHI Magnesita is using the phase-in provision under ESRS 1 Appendix C and has excluded ESRS E1-9 disclosures regarding anticipated financial effects from material physical and transition risks and potential climate-related opportunities from the 2024 Sustainability Statement.

Limited disclosure provided

The company states: "The anticipated financial effects from material transition risks and potential climate related opportunities are presented on table of climate-related risks and opportunities on pages 122-125. There are no material physical risks."

However, the referenced table (pages 122-125) is not included in the excerpts provided, so the specific anticipated financial effects cannot be captured in this disclosure requirement summary.

E5-2 Actions and resources related to resource use and circular economy

Recycling

RHI Magnesita has developed new sorting and cleaning processes to enable high quantities (up to 96%) of recycled materials to be incorporated into refractory products without compromising performance. R&D is continuing in this area, and further technical progress is expected to increase the efficacy of recycling operations.

After proving the new technology, the Group allocated capital to acquisitions of recycling companies including:

• Joint venture established with Horn & Co., MIRECO in 2022
• Acquisition of Refrattari Trezzi in 2024

These acquisitions have increased availability of reclaimed material. Further acquisitions of recycling companies in other geographies are under consideration.

RHI Magnesita has also invested in the development of its own recycling facility in Mitterdorf, Austria.

Achieving higher recycling rates requires developing a closer partnership with customers to optimise the process of breaking out and collecting waste refractories at customer sites. Increased precision in sorting and reducing the time between break out and recycling into new products leads to a higher recycling yield. The Group's solutions contract offering is the ideal platform to offer this partnership to customers and recycling of residual material now forms an important part of the '4PRO' solutions offering. There is a significant strategic opportunity to roll out recycling activities globally.

2024 highlights in recycling initiatives

• Recycling rate of 14.2% achieved in 2024, up from 12.6% in 2023
• Target of 15% by 2025 and 20% by 2030
• Acquisition of Refrattari Trezzi to expand European recycling activities
• Launch of new 'RAPTOR' waste sorting unit utilizing automated sorting technologies
• 1.6t of CO2 can be saved per tonne of recycled raw material used

Financial Resources

For 2025, the CapEx budget for recycling is set at €6 million, prioritizing circular raw materials processing and the integration of innovative technologies to improve operational efficiency.

Beyond 2025, the focus will be on expanding in the refractory circular minerals market outside Europe, leveraging CapEx and M&A to drive growth and market presence.

RHI Magnesita will continue to invest in organic and inorganic projects to increase its recycling activity so long as such investments are calculated to deliver an attractive return on capital compared to other investment opportunities available to the Group.

E5-3 Targets related to resource use and circular economy

2025 Targets

2024 Actual: 14.2%

2030 Targets

Target Description

The Group has established targets to increase the use of secondary raw materials (recycled materials) as a percentage of total raw material consumption in refractories.

• 2025 Target: 15% secondary raw material content (baseline year 2018: 3.8%)
• 2030 Target: 20% combined recycling rate (baseline year 2024: 14.2%)

Progress and Context

The recycling rate metric measures resource efficiency and circular economy integration based on actual consumption of recycled material against total consumption of raw materials in refractories.

Each tonne of recycled material used saves approximately 1.6 tonnes of CO₂ emissions compared to the production of virgin raw material. The use of recycled materials improves local raw material availability and self-sufficiency and can result in cost savings compared to freshly mined material.

In 2024, RHI Magnesita achieved a recycling rate of 14.2%, demonstrating significant progress toward the 2025 target of 15%.

Strategic Context

Recycling is a core part of the Group's strategy to lead in sustainability within the refractory industry. The Group has invested in:

• New sorting and cleaning processes
• Acquisitions of recycling companies (including MIRECO joint venture in 2022 and Refrattari Trezzi in 2024)
• Development of its own recycling facility in Mitterdorf, Austria
• Integration of recycling into the '4PRO' solutions offering

For 2025, the CapEx budget for recycling is set at €6 million, prioritizing circular raw materials processing and innovative technologies.

Policies related to own workforce

RHI Magnesita has established several policies related to its own workforce, aligned with international standards including the UN Guiding Principles on Business and Human Rights, ILO conventions, OECD Guidelines for Multinational Enterprises, and the UN Global Compact.

Health and Safety Policy

• Scope: Applies to RHI Magnesita's own operations and contractors
• Governance: Aligned with ISO 45001
• Key content: Commits to act proactively to prevent occupational health and safety risks and continuously improve health and safety management systems and performance. Covers comprehensive protection for groups at risk, temporary workers, and includes work limitations for young and inexperienced workers
• Public availability: Available on the Group's website
• International alignment: ISO 45001
• Monitoring: Health and safety management systems, workplace risk assessments, incident management reporting, and regular audits

Code of Conduct

• Scope: Applies to all directors, managers, employees regardless of position or contract type, and third parties working on behalf of or at RHI Magnesita premises
• Governance: Approved by the Board of Directors with a zero-tolerance approach to any illegality; signed by EMT members and Regional Presidents; CEO is the most senior executive responsible for policy implementation
• Key content: Detailed standards of behaviour covering general principles and specific guidance in all areas of business conduct, including compliance with human and civil rights as well as applicable labour and social laws
• Public availability: Available on the Group's website in 11 languages, accessible via website, intranet, and Compliance Portal
• International alignment: UN Guiding Principles on Business and Human Rights, UN Global Compact principles, ILO Declaration on Fundamental Principles and Rights at Work, International Bill of Human Rights
• Monitoring: Mandatory e-learning training, compliance reports, whistleblowing channels

Human Rights Policy

• Scope: Applies to all individuals associated with the Group, including Board members, consultants, volunteers, contractors, trustees, candidates, and interns
• Key content: Zero-tolerance approach to modern slavery and human trafficking; commitment to respecting human and labour rights, prohibiting human trafficking and slavery, and promoting safe and fair working conditions
• Public availability: Available on the Group's website
• International alignment: United Nations Universal Declaration of Human Rights, UN Global Compact, UN Guiding Principles on Business and Human Rights, ILO fundamental conventions, OECD Guidelines for Multinational Enterprises
• Governance: Human Rights Officer appointed to oversee and strengthen commitment to ethical business practices; CEO responsible for policy implementation
• Monitoring: Annual Modern Slavery Act statement, screening processes for business partners in high-risk countries, whistleblowing hotline

Global Gender Equality Policy

• Scope: Applies to all individuals associated with the Group, including Board members, consultants, volunteers, contractors, trustees, candidates, and interns
• Key content: Ensures fair and inclusive treatment in the workplace regardless of age, gender, marital or civil partnership status, pregnancy, maternity, family responsibilities, political beliefs, nationality, ethnicity, religion, disability, sexual orientation, or gender identity
• Public availability: Available on the Group's website
• Monitoring: Integrated into performance reviews, succession planning, and diversity and inclusion initiatives

Anti-Discrimination and Anti-Harassment Policy (Global Anti-Harassment Policy)

• Key content: Ensures the working environment is free from discrimination and any forms of harassment; encourages reporting through multiple confidential channels including HR, managers, and whistleblowing hotline
• Monitoring: Multiple confidential reporting channels, investigation processes

Speak Up Policy

• Key content: Offers employees confidential and anonymous avenues to report misconduct via web portals, dedicated phone lines, or direct contact with the Internal Audit, Risk & Compliance team
• Governance: Outlines key investigative principles when handling a report
• Monitoring: Reports assessed by Internal Audit, Risk & Compliance team; reviewed by Audit & Compliance Committee and Board

IMS (Integrated Management System) Policy

• Scope: Applies to RHI Magnesita N.V. and all Group companies and employees (limited to Group companies and employees, does not extend to upstream or downstream value chain)
• Governance: CTO is accountable for implementation
• Key content: Commitment to operate all business activities in a sustainable way to ensure environmental protection, tackling climate change through minimising environmental impacts including direct and indirect CO2 and other greenhouse gas emissions by improving energy efficiency and use of cleaner sources
• Public availability: Published on RHI Magnesita's website
• Monitoring: Integrated into governance framework of ISO-certified management systems

Stakeholder Dialogue Policy

• Key content: Ensures workforce rights and perspectives are respected
• Monitoring: Works Council meetings, employee engagement initiatives

Anti-Corruption Policy

• Scope: Mandatory policy applicable to all employees
• Key content: Zero tolerance of bribery and corruption; prohibits employees from offering, promising or granting any advantage with the objective of obtaining unlawful consideration
• Implementation: Since 2020
• Monitoring: Mandatory e-learning training

Sanctions, Export Controls and Business Partner Due Diligence Policy

• Governance: Board approved
• Monitoring: Due diligence processes for business partners

All aforementioned policies formulated with key stakeholder interests in mind and align with internationally recognized standards. The Group notes that current policies do not yet fully align with all ESRS disclosure requirements, with updates underway to ensure compliance and comprehensive reporting.

S1-2 – Processes for engaging with own workforce and workers' representatives about impacts

Policies supporting workforce engagement

RHI Magnesita has established comprehensive channels for workforce engagement including:

• Townhall meetings – Regular forums for direct communication with employees
• Workvivo communications app – Digital platform for company-wide communications
• Culture Champions network – Employee representatives who promote and support company culture
• Quarterly global webinars – Regular information sessions reaching the global workforce
• Employee Representative Directors on the Board – Direct workforce representation at Board level

Focusing on vulnerable and marginalised groups

The Group's engagement processes are designed to be inclusive and accessible to all employees, including vulnerable and marginalised groups within the workforce.

Employee engagement initiatives

RHI Magnesita's workforce engagement processes include townhall meetings, the Workvivo communications app, the Culture Champions network, quarterly global webinars, and Employee Representative Directors on the Board. These mechanisms ensure regular dialogue with employees and their representatives about impacts on the workforce.

The engagement framework supports two-way communication, allowing employees to raise concerns, provide feedback, and participate in decisions that affect their working conditions and the broader impacts of the company's operations.

These engagement processes are embedded in the Group's governance structure and are overseen by executive management, with the Board receiving updates on workforce engagement through the Employee Representative Directors who participate in Board meetings.

Taking action on material impacts on own workforce

Health and Safety Actions

Preventative measures:

• Establishing standardised safe operating procedures
• Provision of personal protective equipment
• Safety training
• Designing out risks from work-related tasks
• Carrying out risk assessments
• Encouraging near miss reporting
• Conducting comprehensive incident investigations with detailed follow-up actions

Remedial actions:

• Financial assistance for injured individuals or their families through contractual payments, insurance awards, or discretionary awards from the Group's HELP fund initiative
• Follow-up actions to ensure factors leading to incidents are not repeated

Resources allocated:

• €9 million health and safety related capital expenditure in 2024
• Expected to allocate a similar amount of capital each year over 2025-2030 to sustainability and health and safety related capital expenditure (excluding major decarbonisation projects)

Tracking effectiveness: Performance tracked through health and safety KPIs including:

• Lost time injury frequency rates
• Medical cases
• Total incident rate
• Total recordable injuries
• Near misses
• Preventive rate
• Health projects ratio

Monitored monthly at plant and regional level; regularly reviewed by EMT, CSC and Board.

Strategic Partnership with dss+

Action: Review of standards, culture and key serious injury and fatality risks in partnership with dss+

Objective: Move from compliance-based safety approach to deeply embedded safety mindset across all levels

Timeline: dss+ engaged since April 2024; structured coaching programme to be implemented within next two years

Scope: Across all operations globally

Key initiatives:

• Structured coaching programme to guide and develop leadership capabilities at all levels over next two years
• Design and implement structured and sustainable continuous improvement approach to operational risk management
• Focus on mitigating Serious Injuries and Fatalities potential (SIFp) risks

Expected outcomes: Improvement in Group's health and safety performance metrics over medium term

Diversity, Equity and Inclusion Initiatives

Actions undertaken in 2024:

• EmpowHer workshops
• Global mentoring programme for female staff
• Hiring partnership with Female Factor
• Unconscious bias training
• Focus on gender diversity in Global Trainee Programme
• Global campaigns (Disability Day, Female Day)
• Business Resource Groups (regional)
• On-ground interventions with health and safety concerns escalated to senior leadership

Target: Senior leadership (EMT-1) representation at 26% in 2024, requires further action to meet 2025 target of 33%

Other Workforce Initiatives

• Volunteering programmes
• Brand Ambassadors programme
• Culture Champions to advocate for corporate values globally
• Female Factor and DEI campaigns

Procurement and Sales Practices

Procurement: High priority on staff safety in equipment and personal protective equipment procurement decisions

Sales/Services: Ensuring safety of RHI Magnesita employees working at customer sites by:

• Holding customers to high safety standards
• Encouraging staff to report unsafe situations
• Investigating reports of dangerous conditions at customer sites
• Terminating business relationships where actual or potential negative health and safety impacts identified

Operations Excellence System (OES)

Action: Rollout of Operations Excellence System in 2024

Objective: Bring uniformity in processes, standards and parameters to allow comparability and structural cost base improvement

S1-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities

Health and Safety Targets

2025 Target

• Metric: Lost Time Injury Frequency (LTIF)
• Baseline Year: 2018
• Baseline Value: 0.43 per 200,000 hours worked
• 2024 Actual: 0.11 per 200,000 hours worked
• 2025 Target: <0.3 per 200,000 hours worked
• Goal: Zero Harm, No Injuries

2030 Target

• Metric: Total Recordable Injuries Frequency Rate (TRIFR)
• Baseline Year: 2024
• Baseline Value: 0.40 per 200,000 hours worked
• 2030 Target: <1.2 per 200,000 hours worked

Diversity Target

Female Representation in Senior Leadership

• Target: 33% female representation in senior leadership by 2025
• Current: 26%

Note: The Group reports its Lost Time Injury Frequency (LTIF) per 200,000 hours worked as the key metric for its 2025 health and safety performance. The Group will use Total Recordable Injuries (TRI) as metric per 200,000 hours worked to monitor progress to achieve 2030 health and safety target (TRI<1.2 per 200,000 hours worked).

Characteristics of the undertaking's employees

Total headcount and FTE

2024:

• Total headcount: 15,645 employees
• FTE calculation: Full-time employees assigned an FTE value of one; part-time employees calculated as a fraction based on actual working hours relative to full-time schedule

2023:

• Average workforce disclosed in financial statements under IFRS framework (specific number referenced in Note 10 to Financial Statements, not reproduced in sustainability statement)

Headcount by gender

Headcount by employment contract type and gender

Table 3 – Employees by type of contract and gender (referenced on page 162, full table not provided in excerpts)

Headcount by employment contract type and region

Table 4 – Employees by type of contract and region (referenced on page 163, full table not provided in excerpts)

Employee turnover

Table 5 – Number of employee turnover (referenced on page 163, full table not provided in excerpts)

Turnover rate 2024: 12.02% (including seasonal staff, considering death, involuntary, voluntary and retirement categories)

Voluntary employee turnover: 5.21% (2023: 6.50%)

Methodology notes

Definition of headcount: Includes employees actively employed (employees, apprentices, trainees, interns). Excludes temporary workers, contractors, consultants, and individuals on extended unpaid leave. Headcount reflects number of employees at end of reporting period.

Turnover categories: Segmented into death, dismissal, retirement, and voluntary departures. Excludes "Other" category (contract expirations and employee transfers).

Turnover rate calculation: Total departures divided by total employees at end of reporting period.

Regional allocation: Based on primary legal entity location of office, irrespective of remote working arrangements.

Additional information

Gender diversity metrics (leadership context):

• Gender diversity in leadership: 26% (2023: 28%)
• Gender diversity of Board: 33% (2023: 29%)

Scope: Headcount covers 100% of RHI Magnesita employees across 65 main production sites, 12 recycling facilities, and over 70 sales offices in global operations.

Characteristics of non-employees in the undertaking's own workforce

Number of non-employee workers

RHI Magnesita employs approximately 6,000 contractors across its main production sites globally (as stated in the context of forced labour risk assessment). The Health and Safety Policy extends to cover both employees and contractors.

Breakdown by type

No specific breakdown by contractor type (e.g., agency workers, self-employed, or other categories) is disclosed.

Methodology

The counting methodology for contractors is not explicitly disclosed. The company states that it "identifies and monitors its impact on own employees and contractors according to the same safety policies and standards" and that contractors are included in health and safety reporting systems.

For health and safety metrics, contractors are included in total hours worked calculations used for frequency rate denominators. The AccStat reporting system is available to "all employees and contractors with intranet access" for incident reporting.

Multi-year comparison

No multi-year comparative data for the number or characteristics of contractors is provided.

Coverage in safety metrics

Contractors are explicitly included in health and safety performance metrics:

• Total Recordable Injury Frequency (TRIF) includes recordable medical cases and lost time injuries affecting "employees and contractors"
• Lost Time Injury Frequency (LTIF) includes lost time injuries affecting "employees or contractors"
• In 2024, a contractor had a fatal accident at the Dalian plant in China in June 2024

Scope

The Health and Safety Policy and management systems cover contractors working at RHI Magnesita sites. The Group also has employees who work at customer sites, though these are classified as employees rather than contractors.

Collective bargaining coverage and social dialogue

Employee representation structures

RHI Magnesita has established Works Councils in certain countries to ensure employee representation at all organisational levels. The Company maintains structured social dialogue mechanisms, including:

• Works Council meetings: Held quarterly to facilitate engagement with workers' representatives
• Employee Representative Directors (ERDs): Three ERDs appointed by respective works councils serve on the Board of Directors, representing workforce views at the highest governance level:
  • Michael Schwarz (appointed by German Works Council, serving since 2017)
  • Karin Garcia (appointed by Spanish Works Council, serving since 2021)
  • Martin Kowatsch (appointed by Austrian Works Council, Chair of Group Works Council, serving since 2021)

Social dialogue approach

The Company engages with employees both directly and through workers' representatives, including Works Councils. Regional engagement includes:

• Shop-floor discussions led by executive management
• Union collaborations (notably in Brazil to enhance engagement and inclusiveness)
• Detailed discussions between trade unions, works councils and management regarding remuneration and working conditions

Remuneration and collective agreements

In 2024, overall average remuneration increased taking into account inflation, and collective and union agreements. A strata approach to pay increases was implemented to support lower-paid employees. In various locations, detailed discussions took place between trade unions, works councils and management in a structured and transparent manner to deliver fair outcomes for employees.

Group Works Council structure

Martin Kowatsch serves as Chair of the Group Works Council and as Chair of the Works Council at the Flagship Digital Plant in Radenthein. Michael Schwarz is a member of the Works Council at RHI Magnesita Deutschland AG.

Note: The Company confirms the existence of works council structures and employee representation mechanisms, including Board-level representation through ERDs appointed by works councils in Austria, Germany and Spain. However, specific quantitative data on the percentage of employees covered by collective bargaining agreements (overall, EEA, or non-EEA) is not disclosed in the available excerpts.

Gender diversity metrics:

• Board gender diversity: 33% in 2024 (2023: 29%)
• Senior leadership gender diversity: 26% in 2024 (2023: 28%)
• Target: 33% female representation in senior leadership by 2025

Further diversity metrics would be in the Sustainability Statement (pages 64-172).

Health and safety metrics

Coverage by health and safety management system

100% of RHI Magnesita employees are covered by the Group's health and safety management system based on legal requirements and/or recognised standards or guidelines.

Health and safety metrics table

Fatalities detail

Two fatalities occurred in RHI Magnesita operations in 2024:

• One fatality at the Breitenau plant in Austria (February 2024) - own workforce
• One contractor fatality at the Dalian plant in China (June 2024)

Methodology notes

RHI Magnesita uses a Group-wide reporting system (AccStat) available to all employees and contractors with intranet access. The Group reports LTIF per 200,000 hours worked as the key metric for health and safety performance. For 2030 targets, the Group will use Total Recordable Injuries (TRI) per 200,000 hours worked.

Lost Time Injury Frequency (LTIF): Number of lost time injuries affecting employees or contractors divided by total hours worked, expressed per 200,000 hours. A lost time injury results in inability to return to work for the next regular shift.

Total Recordable Injury Frequency (TRIF): Sum of recordable medical cases (beyond first aid) and lost time injuries affecting employees and contractors, expressed per 200,000 hours worked.

Recordable work-related accident: Work-related injury or ill health resulting in death, days away from work, restricted work, job transfer, medical treatment beyond first aid, loss of consciousness, or significant injury diagnosed by a licensed healthcare professional.

Phase-in provisions applied

The Group has applied the following phase-in provisions under ESRS 1 Appendix C:

• ESRS S1-14 88(d): number of cases of recordable work-related ill health of employees - not disclosed
• ESRS S1-14 88(e): number of days lost to work-related injuries, fatalities and work-related ill health - not disclosed

The Group does not have non-guaranteed hours employees.

Compensation metrics (ESRS S1-16)

Pay gap

Not disclosed.

The company stated that the unadjusted gender pay gap was not material in its double materiality assessment.

Remuneration ratio

The company discloses the ratio of the CEO's and CFO's total remuneration to the average employee remuneration.

Methodology

The total employee remuneration figure used for the ratio is for all employees in all Group companies and includes countries with significantly lower levels of pay than Europe and the United States. RHI Magnesita only has around 150 employees in the UK and falls below the required threshold for UK pay ratio reporting requirements.

A significant proportion of the Executive Directors' remuneration is delivered through incentives (annual bonus and LTIP), where awards are linked to company performance and share price movement over the longer term. This means that the pay ratio will depend on the incentive outcome.

The company listed the unadjusted gender pay gap as an indicator but marked it as "Not material" in its disclosure requirements table (ESRS S1-16 paragraph 97(a), page 106).

Incidents, complaints and severe human rights impacts

Definition and Scope

A discrimination incident is defined as direct or indirect discrimination on the basis of protected characteristics, which may include, but are not limited to gender or gender identity, sex, ethnicity, religion or culture, disability, sexuality, age. Indirect discrimination could be putting a criterion in place that may seem neutral, but that would practically be unfavourable for a person with a protected attribute.

This metric has not been externally validated by any organisation other than the assurance provider. There are no fines, penalties and compensations for damages as a result of incidents of discrimination.

2024 Performance

Community policies would be contained in the Sustainability Statement (pages 64-172). However, the company is a member of UN Global Compact supporting UN SDGs with focus on education, health and medical care, and environment.

S3-2: Processes for engaging with affected communities about impacts

Community Engagement Processes

Employee Volunteering Programme

Community engagement processes include local engagement at operational level and an employee volunteering programme with six non-profit organisations.

Engagement with Stakeholders

The Group's comprehensive stakeholder engagement approach is detailed in the "Our Stakeholders" section (pages 26-31 of the Annual Report, incorporated by reference).

Double Materiality Assessment and Stakeholder Engagement

As part of the Double Materiality Assessment (DMA) conducted in 2024, RHI Magnesita engaged with affected communities and other stakeholders to identify and assess material impacts, risks and opportunities. The assessment incorporated:

• Stakeholder perception and validation of DMA results
• Integration of insights from internal experts and external stakeholders
• A structured validation process incorporating stakeholder feedback

The DMA process ensures that the materiality assessment remains dynamic and aligned with evolving regulatory and business contexts.

Local Engagement at Operational Level

Regional management are responsible for delivery of specific regional sustainability objectives and integration of acquired businesses into the Group's sustainability practices, including community relations.

The EVP People, Projects, Integrations & Recycling is responsible for community relations as part of the EMT's sustainability responsibilities.

Channels for Raising Concerns

Various whistleblowing channels are available to employees and external parties to report compliance concerns. Concerns can also be reported anonymously, and all reports are followed up by qualified professionals.

Business conduct policies would be contained in the Sustainability Statement (pages 64-172). However, the company has a Code of Conduct with zero-tolerance approach to illegality. Corporate culture is built on four values: innovation, openness, pragmatism and performance.

G1-5 Political influence and lobbying activities

Disclosure requirement G1-5 – Political engagement and lobbying activities

RHI Magnesita has undertaken to lobby governments to invest in the necessary infrastructure to decarbonise the refractory industry and other energy intensive industries as part of the Group's decarbonisation commitment.

The Group works with partners in the private sector to develop new renewable energy solutions, hydrogen energy networks and carbon capture and utilisation technologies which will be applicable to its upstream suppliers of raw materials.