Saab

The role of the administrative, management and supervisory bodies

Composition of the Board of Directors

According to Saab's Articles of Association, the Board of Directors shall, in addition to the employee representatives, consist of at least six and not more than twelve members. Board members are elected annually by the shareholders' meeting.

At the Annual General Meeting on 11 April 2024, Saab's Board of Directors was resolved to consist of eleven members elected by the shareholders' meeting with no deputies. In addition, employee organisations appoint three Board members with an equal number of deputies.

The following members were re-elected: Lena Erixon, Henrik Henriksson, Micael Johansson, Danica Kragic Jensfelt, Johan Menckel, Bert Nordberg, Erika Söderberg Johnsson, Sebastian Tham, Marcus Wallenberg and Joakim Westh. Anders Ynnerman was elected as a new Board member. Sara Mazur had declined re-election. Marcus Wallenberg was elected Chairman of the Board. At the statutory Board meeting after the Annual General Meeting, Bert Nordberg was elected Deputy Chairman of the Board.

Members of the Board elected by the shareholders' meeting:

• Marcus Wallenberg (Chair)
• Bert Nordberg (Deputy Chair)
• Micael Johansson (President and CEO)
• Lena Erixon
• Henrik Henriksson
• Danica Kragic Jensfelt
• Johan Menckel
• Erika Söderberg Johnsson
• Sebastian Tham
• Joakim Westh
• Anders Ynnerman

Employee representatives (regulars):

• Stefan Andersson
• Göran Andersson
• Magnus Gustafsson

Employee representatives (deputies):

• Robert Hellgren
• Tina Mikkelsen
• Lars Svensson

Board composition and independence

Of the Board members elected by the shareholders' meeting, and not employed by the company, 30 per cent are women.

Only CEO Micael Johansson is employed by the company and at the same time a member of the Board.

According to the provisions of the Code, the following members are considered independent:

¹ Board member of Investor AB
² President and CEO of Saab AB
³ Employed by Investor AB

Accordingly, the company fulfils the Code's requirement that a majority of Board members appointed by the shareholders' meeting are independent of the company and its management, and that at least two are independent of the major shareholders.

Board committees with sustainability oversight

Audit Committee

In accordance with the principles set out in the Swedish Companies Act and the Code, the Board of Directors has appointed an Audit Committee consisting of three members. The Audit Committee's members following the Annual General Meeting 2024 are Joakim Westh (Chairman of the Committee), Erika Söderberg Johnsson and Sebastian Tham, whereof both Joakim Westh and Erika Söderberg Johnsson are independent of company/management and major shareholders. Moreover, all members of the Committee have accounting or auditing competence.

The Audit Committee's assignment includes monitoring the company's financial and sustainability reporting and submitting proposals to ensure the integrity of the reporting, monitoring the efficiency of the company's internal control, internal audit and risk management in respect of the financial and sustainability reporting, keeping itself informed of the audit of the Annual and Sustainability Report and consolidated accounts, informing the Board of the results of the audit and the assurance of the sustainability reporting, and reviewing and monitoring the auditor's impartiality and independence.

The Audit Committee shall annually monitor and evaluate the efficiency and adequacy of the company's anti-bribery and corruption programme including the Code of Conduct, and keep itself informed of material deviations or non-compliance with the company's anti-bribery and corruption programme, including whistle-blower reports, through regular reporting from the Ethics and Compliance Board.

In 2024, the Audit Committee focused especially on current issues relating to the company's financial position, the financial reporting, execution of major projects, procurement, budget, risk management, internal control, investment grade credit rating, sustainability reporting, the company's business ethical rules as well as assisted the Nomination Committee with proposal for election of auditor.

In 2024, the Committee held six meetings.

Remuneration Committee

In accordance with principles set out in the Code, the Board of Directors has appointed a Remuneration Committee consisting of three members. The Remuneration Committee's members following the Annual General Meeting 2024 are Johan Menckel (Chairman), Marcus Wallenberg and Bert Nordberg. All are independent of the company and its management.

The Remuneration Committee's assignments are to prepare the Board's resolutions on remuneration principles, remuneration and other terms of employment for the Group Management, monitor and evaluate variable remuneration programmes for the Group Management, both ongoing and those ended during the year, and monitor and evaluate the application of the remuneration guidelines for senior executives adopted by the Annual General Meeting as well as the current remuneration structures and levels in the company.

In 2024, the Remuneration Committee focused especially on issues relating to the company's long-term incentive programmes, including the proposed performance targets in the company's two performance-related share plans, the Key Employee Plan with synthetic shares for 1,500 key employees (excluding the Board, CEO and Group Management), talent management, the preparation of a remuneration report, and proposal for adjusted remunerations guidelines.

In 2024, the Committee held three meetings.

Sustainability-related expertise and training

The Nomination Committee has considered the size and composition of the Board as well as factors such as competence, experience, sustainability expertise, and diversity. In view of Saab's operations, the Nomination Committee considers that the Board should be in possession of competence within business and society matters, technology, research and development (R&D), sustainability, and innovation, as well as a strategic ability to handle global adaptation to a changing world.

The Nomination Committee applies rule 4.1 of the Code as a diversity policy with respect to the Board. The goal of the policy is that the Nomination Committee's proposal shall lead to that Saab has a board with an appropriate composition and with satisfactory diversity and breadth in terms of gender, competence, age, experience and background.

The company arranged one special information session for the Board members in 2024, where they received detailed information on AI and digitalisation.

Frequency of sustainability discussions at board level

Saab's Senior Vice President & Head of Communication and Sustainability, and Saab's Chief Sustainability Officer present an update and progress on Saab's sustainability impacts, risks and opportunities, implementation of due diligence and performance against related targets to the Audit Committee and Board of Directors on a yearly basis. The material impacts, risks and opportunities were presented to the Board in 2024.

In connection with being informed on material sustainability impacts, risks and opportunities, the Board decided on the company's business plan and strategy, including an updated sustainability strategy and related targets.

The Board of Directors' meetings follow an agenda. Prior to each meeting, Board members receive documentation and supporting material for the issues on the agenda. At each Board meeting the CEO presents a Market and Operations Report. A financial report is also presented at each Board meeting and is addressed in detail prior to the publication of the interim reports and the year-end report. The Board regularly considers investments, research and development, organisational issues, management of significant risk areas, and acquisitions and divestments of companies.

Specific roles assigned

President and CEO: Micael Johansson

Senior Vice President & Head of Communication and Sustainability: Viktor Wallström (member of Group Management since 2022)

Chief Sustainability Officer: Reports to the Board of Directors and Audit Committee on sustainability impacts, risks and opportunities, implementation of due diligence and performance against related targets on a yearly basis.

The Chairman of the Sustainability Board reports on sustainability matters, such as impacts, risks and opportunities and performance against targets, at least quarterly to the Group Management team.

Board's work in 2024

Key sustainability topics addressed:

• The Board worked with topics related to meeting the customers' increased demand and investments in capacity, building new production plants and recruiting the right competences
• The Board has worked with specific strategic matters, such as future defence capabilities
• The Board approved the updated sustainability strategy
• In 2024, the Board especially focused on topics relating to Sweden's membership in NATO and the effects of the war in Ukraine

Work of the Board:

According to the Board's rules of procedure, seven ordinary meetings shall normally be held each year in addition to the statutory meeting. The Board can also meet when circumstances demand. In 2024, the Board held one statutory meeting, seven ordinary meetings and four extra meetings, a total of twelve meetings.

The Board annually adopts rules of procedure, an instruction on the division of work between the Board and the CEO, and an instruction on financial reporting to the Board. The rules of procedure contain provisions on the number of Board meetings, a list of matters to be considered at the meetings, reporting from the auditor and special decisions to be taken at the statutory meeting.

The Board's annual work includes deciding on the company's business plan and strategy, which in 2024 were addressed in December. The Board meeting in December also considers the company's budget for the coming year as well as Enterprise Risk Management. In December, the Board also addressed the performance targets in the company's two performance-related share plans.

Attendance and remuneration

Attendance at Board and Committee meetings in 2024:

¹ Of a total of 12 meetings in 2024
² Of a total of 6 meetings of the Audit Committee in 2024 and 3 meetings of the Remuneration Committee in 2024
³ Refers to the remuneration resolved by the AGM 2024 for the period until the AGM 2025. CEO Micael Johansson does not receive remuneration
⁴ Elected by the AGM in April 2024, thereafter participated in 7 of a total of 8 Board meetings

Independence and effectiveness arrangements

Evaluation:

The Chairman of the Board annually performs an evaluation of the Board's work and possible improvement areas in order to develop the forms and effectiveness of its work. The evaluation is made by having Board members respond to a questionnaire and give their opinions on the Board's work and performance. The results are then compared with previous years and discussed at the Board meeting in December.

The questionnaire consists of six parts covering the breadth of the Board's competence, how the Board conducts its work, the Chairman, the Board's composition, the cooperative atmosphere and possible improvements. The Chairman of the Board does not participate in the Board's discussion on the results of the Chairman's evaluation. The Nomination Committee is informed of the results of the evaluation in connection with preparing its proposal on the composition of the Board.

The Board continuously evaluates the CEO's work by monitoring the company's performance relative to established goals. The Board annually evaluates the CEO's work through its members' responses to a questionnaire on the CEO in the areas of performance, organisation, people and leadership. The CEO does not participate in this evaluation.

Secretary of the Board:

During the year, the Board was assisted by the secretary of the Board of Directors, General Counsel Annika Bäremo, who is not a member of the Board.

Integration of sustainability in incentive schemes

The Annual General Meeting in 2024 resolved on a long-term Performance Share Plan 2025 for 300 key employees. The long-term Performance Share Plan 2025 contains two sustainability targets of 10% of the total allotment:

• 5% is attributable to the annual average CO2 reduction during the financial years 2025-2027. The target refers to the reduction of emissions within the following areas: district heating and cooling, steam, electricity, stationary combustion, company cars, accidental emissions, corporate flight services and special flight operations (excluding test flights with Gripen and GlobalEye). The maximum level for the sustainability target for annual average CO2 reduction shall correspond to an annual average CO2 reduction of 4.2%, and the minimum level shall correspond to an annual average CO2 reduction of 0% during the financial years 2025-2027.

• The remaining 5% is attributable to the increase of the percentage of female employees in the Saab Group by the end of the financial year 2027. The minimum level for the sustainability target for increase of the percentage of women employees in the Saab Group shall correspond to 25% women employees in the Saab Group by the end of the financial year 2027, and the maximum level shall correspond to 28% women employees in the Saab Group by the end of the financial year 2027.

Integration of sustainability-related performance in incentive schemes

Overview

Saab integrates sustainability-related performance in incentive schemes through long-term Performance Share Plans that include specific sustainability targets for key employees.

Covered roles and employees

• Performance Share Plan 2024: 200 key employees
• Performance Share Plan 2025: 300 key employees

Performance Share Plan 2024

Sustainability KPIs and weighting

• Weighting: 10% of total allotment tied to sustainability
• KPI: CO2 reduction target
• Scope: Greenhouse gas reductions within Scope 1 and Scope 2, in accordance with the Greenhouse Gas (GHG) Protocol

Target structure and performance thresholds

• Threshold for performance matching: Minimum 4.2% annual reduction level
• Alignment: In line with the Science Based Targets initiative (SBTi) that Saab has committed to
• Incentive type: Long-term incentive (LTI)

Performance Share Plan 2025

Sustainability KPIs and weighting

• Total sustainability weighting: 10% of total allotment (split across two targets)
• KPI 1 - CO2 reduction: 5% of total allotment
• KPI 2 - Gender diversity: 5% of total allotment

CO2 reduction target (5%)

Scope of emissions:

• District heating and cooling
• Steam
• Electricity
• Stationary combustion
• Company cars
• Accidental emissions
• Corporate flight services
• Special flight operations (excluding test flights with Gripen and GlobalEye)

Performance period: Financial years 2025-2027 (annual average reduction)

Target structure:

• Maximum level: 4.2% annual average CO2 reduction during 2025-2027
• Minimum level: 0% annual average CO2 reduction during 2025-2027
• Calculation method: Sum of annual CO2 reduction in percentage for each financial year 2025-2027, divided by three

Gender diversity target (5%)

KPI: Increase of the percentage of female employees in the Saab Group by end of financial year 2027

Target structure:

• Minimum level: 25% women employees in the Saab Group by end of financial year 2027
• Maximum level: 28% women employees in the Saab Group by end of financial year 2027

Incentive type

Both Performance Share Plans 2024 and 2025 are long-term incentive (LTI) programmes.

Reference to further details

For more information about Remuneration and long-term incentive programmes, see Corporate Governance report on pages 63-65.

Strategy, Business Model and Value Chain

Business Model

Saab's global operations span across continents, with a presence in key markets and emerging regions. Leveraging decades of expertise in defence, security, and advanced technology, Saab offers innovative solutions tailored to the specific needs of each market. From aerospace to underwater defence, Saab's global footprint ensures that we remain at the forefront of technological advancements, collaborating closely with governments, industries, and defence forces to meet their security challenges.

Core Areas and Value Proposition

Saab has defined five core areas where the company has a strong market position and a leading product portfolio:

Fighter Systems: Saab's latest fighter version, the Gripen E, is certified for military use by both the Swedish and Brazilian Air Forces. The E-series has several new features including cutting-edge sensors, enhanced weapon capability and electronic jammer pods.

Advanced Weapon Systems: The area holds products ranging from ground combat support weapons to missiles and training systems. Saab's Ground Combat systems hold an undisputed market leading position.

Sensors: Saab is a world-leading supplier of sensors, radar technology and electronic warfare solutions. The sensor portfolio comprises systems such as the Giraffe radar family and the GlobalEye AEW&C system.

Command and Control Systems: Saab provides complete command and control solutions for land, air and naval use, with a particularly strong position within the naval domain.

Underwater Systems: Saab is a leading provider of naval systems primarily to the Swedish Navy. The offer ranges from surface vessels with stealth characteristics to advanced conventional submarines, autonomous underwater systems and combat boats.

Strategic Markets

Saab operates in over 100 countries worldwide. In addition to Sweden, Saab is focusing on the U.S., the U.K., Germany and Australia as the main platforms for future growth. In these selected strategic markets, Saab sees opportunities for further growth in niches and technology areas where Saab has a strong position such as sensors, underwater systems and command and control systems.

Value Chain

Saab serves customers in over 100 countries and operates in more than 30 countries. Research and development is concentrated in Sweden with employees in Europe, the U.S., Australia and South Africa. The company has 24,500 employees globally with operations spanning across continents.

Interests and views of stakeholders

Identified stakeholder groups and engagement approaches

Stakeholder expectations and information needs are vital to Saab's ongoing materiality assessment process. This input helps prioritise the key sustainability aspects of Saab's sustainability strategy and sets the content of this report. We gather stakeholder feedback through various channels, as illustrated in the table below. Stakeholders emphasise the importance of Saab's zero-tolerance approach to corruption and responsible sales practices, including upholding human rights. Many stakeholders are as well requesting further information about our sustainable innovations and carbon reduction efforts. Each stakeholder group has unique expectations based on their specific interests.

Integration into strategy and business model

Saab prioritises stakeholder engagement, actively seeking feedback on its climate strategy through dialogues and meetings. These inputs shape the strategy and ensures alignment with stakeholder needs and expectations.

Stakeholder interests are considered through different means in the Responsible Sales process. Firstly, Saab's Responsible Sales Index is based on five internationally recognised democracy and human rights indices. This composite index is used to screen business opportunities for human rights risks. Secondly, when producing Responsible Sales Risk Assessment, internationally recognised human rights reports are used to conduct due diligence. This includes both reports produced by government actors and non-governmental organisations. Thirdly, Saab regularly engages with stakeholder groups, which provides Saab with input on risks that are material to consider in the due diligence processes.

Saab provided sustainability information to employee representatives and discussed the information with the representatives. The management was informed of the employee representatives' opinion.

Distinction between affected stakeholders and users of sustainability information

The stakeholder table identifies both affected stakeholders (own workforce, workers in the value chain, affected communities) and users of sustainability information (owners and investors). The engagement channels and material topics differ between these groups, with investors focused on governance topics like Responsible Sales and Anti-Corruption, while affected stakeholders raise operational concerns including occupational health and safety, and business and human rights.

Material Impacts, Risks and Opportunities

Sustainability Strategy Based on Materiality Assessment

The strategy is based on an update of the double materiality assessment (DMA) and reflects increased stakeholder expectations from the financial market, our employees, our customers and legislators.

Three Strategic Focus Areas

Saab's sustainability strategy is built on three pillars, with prioritised areas within each:

1) Resilient and safe societies

• Business and Human Rights: Saab has an industry-leading Human Rights Programme
• Anti-Corruption: Saab has an industry-leading anti-bribery and corruption programme
• Information Security: Saab has a defined, well-functioning, proactive and systematic approach to information security
• Export Compliance: Saab will remain a leader in export control through robust rules, processes and training

2) Green and social transition

• Climate Impact: Reduce emissions by 42% (Scope 1 & 2) (compared to 2020), Reduce emissions by 25% (Scope 3) (compared to 2020), Net zero emissions by year 2050
• Substances of Concern: Tools deployed for efficient handling of product life cycle data, Define and set target to minimise the use of "Target substances"
• Circular Economy: Operate with circular industrial processes and develop circular products in line with definitions from the EU Circular Economy Action Plan (EU CEAP)
• Occupational Health and Safety: Reduce number of work-related accidents, measured by decreased TRIFR by 25% (compared to 2024), Improve employees experienced work life balance and reach benchmark top 25th percentile (8.3)

3) Innovation and partnerships

• Diversity and Inclusion: At least 30% women employees, At least 35% women managers
• Sustainable Innovation: Design for sustainability is established in product development throughout Saab. Sustainable innovation contributes to increased competitiveness and operational value
• Industrial Cooperation and Partnership: A significant part of our industrial cooperation activities are within the definition of sustainability. Partnerships with external actors contribute to Saab's sustainability commitments and strategy

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

Double Materiality Assessment Process

The starting point for the first ESRS double materiality assessment (DMA) in 2023 was the list of material topics from the sustainability reporting in accordance with GRI (The Global Reporting Initiative). The previous sustainability reporting and sustainability strategy was based on an extensive materiality analysis undertaken in 2021. Saab, as a business group within the aerospace and defence industry, have additional sector specific material topics which have been included, such as Export control, Sustainable innovation, Industrial cooperation and partnerships, and Information security.

With the incorporation of ESRS, Saab included the list of sustainability matters in ESRS 1 AR 16. All topics, sub-topics and sub-sub topics in ESRS 1 AR 16 were included in the scope, but some of the sub-sub topics and sub-topics were aggregated for assessment on a higher level.

The list of sustainability topics, sub-topics and sub-sub topics in ESRS, together with entity-specific sustainability topics, identified in stakeholder dialogues, was used to structure the DMA and to ensure that all topics in ESRS were covered.

Methodology

A dedicated sustainability reporting project led the work in terms of planning and performing the DMA. The DMA involved multiple stakeholders in the organisation. The actual assessment was performed in a number of workshops including subject matter experts within environment, ethics and compliance, human resources, human rights, finance, procurement, enterprise risk management and strategy.

During the workshops, the participants identified and assessed sustainability-related impacts, risks and opportunities based on Saab's value chain, business relationships, products and services provided. The geographic location of own operations, suppliers and customers was also taken into account. Short-, medium- and long-term perspectives were considered in the assessment.

Inputs to the Assessment

• List of sustainability matters in ESRS 1 AR 16
• Previous GRI materiality analysis from 2021
• Entity-specific sustainability topics identified in stakeholder dialogues
• Subject matter experts within environment, ethics and compliance, human resources, human rights, finance, procurement, enterprise risk management and strategy
• Saab's value chain, business relationships, products and services
• Geographic location of own operations, suppliers and customers
• Output from previous TCFD analysis (for climate financial risks and opportunities)

Scoring Criteria for Impact Materiality

Saab evaluated the actual impact of its operation on each topic using predetermined scales to measure the parameters "Scale", "Scope", and the potential for mitigation.

• Scale was evaluated from 1 to 7 and represents how grave or beneficial the impact is or may be for people, society and/or the environment. (1 = "Insignificant impact" and 7 = "Catastrophic impact/Extremely beneficial")
• Scope was evaluated from 1 to 7 and represents the extent or how widespread the impact is or may be. (1 = "No spread of impact outside company premises and/or very few people affected" and 7 = "Global environmental/societal impact and/or a very large number of people affected.")
• In addition for negative impacts, Saab evaluated the possibility to restore the impact to its prior state. Irremediable character was evaluated from 1 to 7. (1 = "Very easy to restore" and 7 = "Impossible to restore")

For potential impacts, Likelihood was also considered on a scale from 1 to 7 (1 = "Unlikely" and 7 = "Very high likelihood").

To determine the sustainability material topics:

• The average of the scores for "Scale" and "Scope" was calculated for each actual positive and negative impact.
• For actual negative impacts "Irremediable character" was also taken into account
• For potential impacts the "Likelihood" was included in the calculation of the average

The threshold was set at 5,0 and topics with an impact above the threshold was considered material.

Scoring Criteria for Financial Materiality

Financial risks and opportunities were assessed based on Saab's Enterprise Risk Management (ERM) process with the parameters of "Magnitude" and "Likelihood". The output from previous TCFD analysis was used as an input when assessing climate financial risks and opportunities. For the financial risks and opportunities the predefined thresholds in the ERM process were used and all risks and opportunities with values of orange and red were considered material.

Threshold for Materiality

• Impact materiality: The threshold was set at 5.0 and topics with an impact above the threshold was considered material.
• Financial materiality: All risks and opportunities with values of orange and red (per ERM predefined thresholds) were considered material.

All topics above the thresholds constitute Saab's material sustainability topics.

Stakeholder Engagement

Saab's stakeholder dialogue with our key stakeholders such as shareholders, financial institutions, employees, customers, suppliers, industry and civil society actors additionally influenced the assessment.

Frequency and Last Review

An update to the DMA, with the same methodology, was performed during autumn 2024 with the same stakeholder groups. Saab's Board of Directors was informed of the result of the updated DMA in December 2024 as part of the Board's approval of the sustainability strategy. Saab provided sustainability information to employee representatives and discussed the information with the representatives. The management was informed of the employee representatives' opinion.

The plan going forward is to undertake a more comprehensive double materiality assessment every three year, with an annual review during autumn. For 2025, the DMA will be revisited and verified during the spring to prepare for the first full sustainability reporting in accordance with ESRS.

Value Chain Mapping

During the workshops, the participants identified and assessed sustainability-related impacts, risks and opportunities based on Saab's value chain, business relationships, products and services provided. The geographic location of own operations, suppliers and customers was also taken into account.

Saab has or may have an impact on people, economy and environment in various phases of the value chain, either directly or indirectly. An illustration on page 77 gives a basic overview of Saab's value chain with its related impacts.

Governance

Saab's Board of Directors was informed of the result of the assessment in December 2023 as part of the Board's approval of Saab's updated sustainability strategy, including actions, targets and metrics.

In connection with being informed on material sustainability impacts, risks and opportunities, the Board decided on the company's business plan and strategy, including an updated sustainability strategy and related targets.

Climate-Related Assessment

Climate-related risks and opportunities are identified and assessed in accordance with Saab's risk process. In this way, the relative significance of climate-related risks is visible. The method for assessing opportunities is a NABC model (Need, Approach, Benefit and Competition) and Innovation matrix. The matrix provides an understanding of whether the innovation is progressive or radical and if it will benefit our own operations or if it will provide a positive impact to our customers.

We manage the impact of financial physical climate risks through Saab's comprehensive global insurance program, designed to mitigate property damage and business disruptions. At the asset level, we utilise the Saab Blue Risk Management Programme, developed in partnership with WTW, to identify and assess physical risks. This programme involves "Blue surveys" conducted by risk engineers who inspect Saab plants and evaluate various physical risks and recommend mitigation actions.

We utilise our existing Enterprise Risk Management (ERM) platform, which allows a holistic analysis of both financial and strategic impacts from climate related risks.

Business Conduct

The identification of material impacts, risks and opportunities, in relation to business conduct matters, followed the general process for the DMA described earlier in this section.

Sustainability is integrated through-out the Annual Report. Pages 66-145 describe Saab's sustainability work in greater detail and comprise the statutory Sustainability Report. We are publishing our first Sustainability Report inspired by the European Sustainability Reporting Standards (ESRS).

Transition plan for climate change mitigation

Overview

The work related to the finalising of the Climate Transition Plan (CTP) is ongoing and will be published during 2025. It will be presented to the Board for approval. The CTP is a further expansion of the current published Climate Reduction Plan.

The CTP sets out the strategy and pathway to deliver on Saab's Net Zero target. It describes the past, current, and future mitigation efforts to ensure that Saab's strategy and business model are compatible with the transition to a sustainable economy, and with the limiting of global warming to 1.5°C in line with the Paris Agreement and with the objective of achieving climate neutrality by 2050. The CTP lays out the foundation, ambition and execution to reach Saab's targets.

In detail, the CTP describes the key actions, and important Key Performance Indicators to measure the climate transition, gives insights on governance and accountability mechanisms to support the delivery, the financing required for the transition, collaborations needed to realise the transitions, locked-in Greenhouse Gas (GHG) emissions, and addresses material risks and opportunities.

For further information about revenues, capital expenditures and operating expenses for activities supporting our climate transition plan in the current financial year, see [EU Taxonomy], pages 100-106.

Alignment with Paris Agreement and 1.5°C / SBTi validation

Saab's ambition is to be a sustainability leader within the defence sector, demonstrated by being the first major defence company to have the emission reduction targets approved by the Science Based Targets initiative (SBTi) approved. These targets, published in 2021 and approved in 2022 (near term) and 2023 (long term Net Zero), align with the latest climate science and support the goal of limiting global warming to 1.5°C.

Saab became the first major defence company to receive approval for its 2050 greenhouse gas emission targets by the Science Based Targets initiative.

Target year(s) for net zero

Overall Net Zero target: Saab has committed to reach Net Zero greenhouse gas emissions across the value chain by 2050.

Near-term targets:

• Saab has committed to reduce absolute Scope 1 and Scope 2 GHG emissions by 42% by 2030 from base year 2020*
• Saab has committed that 50% of Saab's suppliers (purchased goods, services and capital goods) will adhere to approved science-based targets by 2027
• Saab has committed to reduce absolute Scope 3 GHG emissions covering upstream transportation and distribution, business travel and use of sold products by 25% by 2030 (base year 2020)

Long-term targets:

• Saab has committed to reduce absolute Scope 1 and 2 GHG emissions 90% by 2050 (base year 2020)
• Saab has committed to reduce absolute Scope 3 GHG emissions 90% within the same timeframe

*The target boundary includes land related emissions and removals from bioenergy feedstock.

Scope 1, 2, 3 reduction milestones with baseline years

GHG Emissions change (baseline year 2020):

¹⁾ Target to reduce Scope 3 GHG emissions upstream transportation and distribution, business travel and use of sold products 25% by 2030 from a 2020 base year.

Progress in 2024: In 2024, Saab achieved a 6.4% reduction in Scope 1 and Scope 2 emissions compared to the previous year, surpassing the SBTi requirement of 4.2% for the reporting year. The reduction corresponds to 1382 tCO2e.

Key decarbonisation levers and actions

Decarbonisation levers and connected key actions:

Fuel switching & Product updates (Scope 1)

• Reduce emissions from flight operations
• Purchase of SAF for own flight operations
• Collaborate with customers to ensure SAF in our supply chains

Energy efficiency & Use of renewable energy (Scope 1 & 2)

• Increase share of renewable energy and improve energy resilience
• Improvements in energy efficiency of buildings

Supply chain decarbonisation (Scope 3 - Purchased goods and services)

• Engage our suppliers in committing to science-based targets

Fuel switching & Product updates (Scope 3 - Use of sold products)

• Enable reduced emissions from the use phase of our products
• Ensure that design criteria are aligned with our commitment

Energy efficiency & Fuel switching & Use of renewable energy (Scope 3 - Business travel / upstream transportation)

• Reduce emissions from our business travel, through changed travel habits, mindset and applying new technology
• Work with suppliers of goods transportation to ensure transition to low-carbon transport methods

Key actions during 2024:

• Energy efficiency measures implemented across Saab sites such as isolating to reduce the use of heating and investments in solar panels
• Saab's Climate Fund supported four innovative projects selected through this year's Innovation Call: Climate. These projects directly address key decarbonisation levers: energy efficiency, fuel switching, and renewable energy use
• Since mid-2023, Saab only allows zero emission/electric options for new orders of company cars in Sweden. Considering average lease and delivery lead times, we expect that all of Saab vehicles in this category will be zero-emission by 2026. The increased share of zero emission vehicles resulted in a 1% reduction during 2024
• To explore the potential of sustainable aviation fuel (SAF), Saab has undertaken thorough evaluations for its flight operations, encompassing aerial firefighting and test flights

CapEx / investment commitments

Finance and Resources: Our Climate Transition Plan will be integrated with our financial plan, as required by the EU Taxonomy Regulation. This integration takes several forms, including establishment of a Climate Fund and a Carbon budget. Saab has dedicated approximately 100 full-time and part-time resources to our Climate Taskforces, who are focused on driving emissions reductions.

To effectively monitor progress emissions reductions are connected to financial costs. A key element of this is developing an internal carbon pricing mechanism. This will allow us to compare the costs of different reduction efforts, understand the annual cost of achieving our targets and make informed decisions regarding climate related investments. Once we have finalised the detailed roadmap for our transition to 2050, our internal carbon pricing will help us identify any remaining financing needs and ensure we can close the gaps in our decarbonisation journey.

Key investments: We have integrated climate impact considerations into our corporate investment process, ensuring that all operations-related investments and business development initiatives factor in climate-related risks and opportunities. This updated process prioritises investments with the potential to mitigate climate risks and capitalise on emerging opportunities.

In South Africa and Australia, photovoltaic cells have been installed on Saab's buildings. In South Africa, the facility has previously relied on diesel generators to provide emergency power during power outages. The investment will result in both a reduced climate impact of production and a secured electricity supply, which reduces the risk of significant impact on operations. In Australia, about 100 solar panels are installed in connection with new construction, which is estimated to generate about 100 kW.

Key actions during the year included energy efficiency measures implemented across Saab sites such as isolating to reduce the use of heating and investments in solar panels.

Locked-in emissions and stranded asset analysis

Saab has analysed the entire value chain to identify key actions crucial for reaching our 2050 targets. This ongoing process also helps to identify potential technology gaps where innovation and collaboration with partners and customers will be crucial.

The CTP describes locked-in Greenhouse Gas (GHG) emissions and addresses material risks and opportunities.

Use of carbon credits / removals

Saab has not disclosed extensive information about use of carbon credits or removals in relation to the transition plan, though the CTP will address this.

Integration with business plan

As part of Saab's commitment to the SBTi and the UN's Race to Zero, we have implemented a dedicated project spanning our entire value chain. This project has significantly influenced our overall strategy, leading to the development of our Property Energy Plan.

Although climate change has not significantly impacted Saab's operations to date, the company recognises potential risks and opportunities. These include challenges posed by the transition to a low-carbon economy and the physical impacts of climate change, as well as emerging business opportunities.

A key decision driven by climate-related risks is setting ambitious climate targets for 2030. This long-term vision guides actions like the installation of solar panels in South Africa, Australia, and Sweden, and the implementation of energy efficiency measures at major sites.

Climate-related risks are influencing investment decisions, making long-term energy efficiency investments more viable. Proposals are evaluated based on kWh savings, cost savings, and CO2 reduction, prioritising solutions with the greatest energy savings and shortest payback times. These investments reduce operating costs and support the climate transition plan.

Progress monitoring

The progress of the CTP-project is closely monitored and reported to Group Management on a regular basis, using predefined milestones.

Saab has integrated its environmental strategy and climate targets throughout the organisation through a comprehensive programme. This programme includes overall climate targets, sub-targets at both the Group and Business unit levels, and detailed action plans to achieve these targets. Progress is tracked and reviewed four times per year.

Policies related to climate change mitigation and adaptation

Saab has established several policies that relate to climate change mitigation and adaptation:

Environmental Policy

Scope: All Saab operations and suppliers

Key content: The Saab Environmental Policy states that Saab shall work to minimise its environmental impacts from plants, products and services. The policy highlights the following levers as material:

• Identification and minimisation of the products and operations' environmental risks
• Minimising the use and emission of hazardous substances and materials
• Minimising the emissions of greenhouse gases
• Making more efficient use of energy and natural resources
• Fulfilling applicable compliance obligations
• An attitude of openness in communicating our environmental work

Certification and standards: All Saab's major sites are certified according to ISO 14001:2015, which means that the management systems fulfill the requirements in the standard.

Supply chain requirements: Through Saab's Supplier Code of Conduct, the company expects suppliers to also operate an environmental management system that adheres to ISO14001.

Supplier Code of Conduct

Scope: All suppliers

Key content: The Supplier Code of Conduct, which was updated during 2024, states that:

• Suppliers shall adhere to all applicable laws and regulations
• Suppliers are encouraged to set their own, or align to Saab's sustainability targets
• Suppliers are obligated to actively work towards reducing their environmental and climate impact
• Suppliers are expected to develop a plan to achieve Net Zero greenhouse gas emissions in their operations and supply chain by 2050 at the latest, or set science-based targets

Travel Directive

Scope: All Saab Group employees, including consultants

Key content: The Travel Directive provides clear guidance on business travel policies. The policy:

• Guides employees towards selecting the most sustainable transportation options available
• Encourages prioritisation of virtual meetings when possible
• Takes into account impact on employees' personal lives
• Adheres to relevant regulations, such as Swedish law regarding rest periods during business travel

Link to international commitments: Aligned with Saab's commitment to the SBTi and the UN's Race to Zero, the Travel Directive supports decarbonisation efforts, specifically in the areas of fuel switching and renewable energy use.

Contribution to targets: This directive contributes to Saab's Scope 3 Category 6 Business Travel greenhouse gas emission reduction target.

Energy Strategy

Scope: Key areas within the Saab Group

Key content: The Energy Strategy provides clear guidance on how key areas within Saab can achieve emission reductions from energy use, aligning with approved science-based targets commitments while ensuring a resilient energy system capable of adapting to a changing world.

The strategy:

• Outlines a clear hierarchy for action, prioritising mitigation actions and investments
• Recognises that sites in different regions face varying prerequisites for energy production and tailors recommendations accordingly

Link to international commitments: Aligned with Saab's commitment to the SBTi and the UN's Race to Zero.

Focus areas: Energy efficiency and renewable energy use.

Contribution to targets: This strategy directly contributes to Saab's Scope 1 & 2 greenhouse gas emission reduction targets for purchased and manufactured energy.

Integration: The Energy Strategy is integrated with Saab's impact, risk, and opportunity analysis, reflecting commitment to capitalising on energy efficiency improvements for cost reductions, particularly at less energy-efficient sites.

Actions and resources in relation to climate change policies

Progress in implementing Climate Transition Plan (2024)

Saab has implemented a dedicated project spanning the entire value chain as part of its commitment to SBTi and the UN's Race to Zero. This project has influenced overall strategy and led to the development of the Property Energy Plan.

Key actions during 2024:

• Energy efficiency measures implemented across Saab sites such as isolating to reduce the use of heating and investments in solar panels
• Climate Fund innovation projects: Four innovative projects selected through the Innovation Call: Climate, directly addressing key decarbonisation levers: energy efficiency, fuel switching, and renewable energy use
• Zero emission company cars: Since mid-2023, Saab only allows zero emission/electric options for new orders of company cars in Sweden. Expecting all vehicles in this category to be zero-emission by 2026. The increased share of zero emission vehicles resulted in a 1% reduction during 2024
• Sustainable aviation fuel (SAF) evaluation: Thorough evaluations undertaken for flight operations, encompassing aerial firefighting and test flights
• Updated investment process: Climate impact considerations integrated into corporate investment process, ensuring all operations-related investments and business development initiatives factor in climate-related risks and opportunities

2024 Results:

• Achieved 6.4% reduction in Scope 1 and Scope 2 emissions compared to 2023, surpassing the SBTi requirement of 4.2% for the reporting year
• Reduction corresponds to 1,382 tCO2e

Decarbonisation levers and connected key actions

Fuel switching & Product updates (Scope 1)

• Reduce emissions from flight operations
• Purchase of SAF for own flight operations
• Collaborate with customers to ensure SAF in supply chains

Energy efficiency & Use of renewable energy (Scope 1 & 2)

• Increase share of renewable energy and improve energy resilience
• Improvements in energy efficiency of buildings
• Installation of solar panels in South Africa, Australia, and Sweden

Supply chain decarbonisation (Scope 3 - Purchased goods and services)

• Engage suppliers in committing to science-based targets
• 50% of suppliers (purchased goods, services and capital goods) to adhere to approved science-based targets by 2027

Fuel switching & Product updates (Scope 3 - Use of sold products)

• Enable reduced emissions from the use phase of products
• Ensure that design criteria are aligned with commitments

Energy efficiency & Fuel switching & Use of renewable energy (Scope 3 - Business travel / upstream transportation)

• Reduce emissions from business travel, through changed travel habits, mindset and applying new technology
• Work with suppliers of goods transportation to ensure transition to low-carbon transport methods

Finance and Resources

Human Resources:

• Approximately 100 full-time and part-time resources dedicated to Climate Taskforces, focused on driving emissions reductions

Financial Resources:

• Climate Fund established to support innovation projects
• Climate Transition Plan will be integrated with financial plan, as required by EU Taxonomy Regulation
• Internal carbon pricing mechanism under development to compare costs of different reduction efforts, understand annual cost of achieving targets and make informed decisions regarding climate-related investments
• For revenues, capital expenditures and operating expenses for activities supporting the climate transition plan, see EU Taxonomy disclosure pages 100-106

Process Integration:

• Emissions reductions connected to financial costs
• Progress monitored and reported to Group Management on regular basis using predefined milestones
• Investment proposals evaluated based on kWh savings, cost savings, and CO2 reduction

Governance and Monitoring

• Progress of CTP-project closely monitored and reported to Group Management regularly
• Comprehensive programme with overall climate targets, sub-targets at Group and Business unit levels
• Progress tracked and reviewed four times per year
• Climate Transition Plan to be presented to the Board for approval and published during 2025

Climate Targets

Scope 1 & 2 Emissions

• Target: Reduce emissions by 42% (Scope 1 & 2) compared to 2020 baseline

Scope 3 Emissions

• Target: Reduce emissions by 25% (Scope 3) compared to 2020 baseline

Long-term Target

• Net zero emissions by year 2050
• Saab becomes the first major defence company to receive approval for its 2050 greenhouse gas emission targets by the Science Based Targets initiative

Energy consumption and mix

Energy consumption and mix (MWh)

Scope and methodology: The energy mix is calculated using energy consumption data and statistic information about energy mix in locations where energy is consumed. A conservative approach is applied when incorporating estimated values into calculations.

For electricity and heat/steam/cooling calculations, only quantities covered by RECs (Renewable Energy Certificates) are considered to be from renewable sources. The remaining share of energy will be considered fossil fuel based, regardless of the local electricity mix of renewable energy.

Fuel type allocation is determined by emission factors, with energy distribution calculated accordingly. All non-renewable fuel consumption in Scope 1 category "stationary combustion" is included (biomass is excluded, as this is counted as renewable).

All renewable energy production is included, which includes self-generation of energy using biomass burning (from Scope 1 stationary combustion) and solar panels (Scope 2).

The total energy consumption for the comparative year 2023 (365,427 MWh) has been updated from previously stated in last year's Annual Report (365,237 MWh) as part of Saab's back-tracking and data quality assurance process, resulting in a 190 MWh increase in total consumption.

Since all activities are considered to be in high climate impact sectors, financial data is consistent with reported Sales in Financial Statements.

Note: Despite Saab's strong growth and expansion, energy consumption has not increased to the same extent due to prioritised activities including improvements to buildings, ventilation recovery of heat and time optimisation of heat use. Saab has initiated important activities to improve recycling of steam used for heating.

Gross Scopes 1, 2, 3 and Total GHG emissions

Scope 1 and 2 emissions

*2020 values approximated from chart on page 41 showing "Scope 1 & 2 emissions, tonnes CO2e" with data points from 2020-2024.

Year-on-year change (2024 vs 2023): Scope 1 & 2 emissions reduced by 6.4% compared to 2023.

Methodology note: In 2024, Saab reduced emissions by 6.4% compared to 2023. The reduction was driven by continued work with energy efficiency measures, a reduced mix of emission-intense energy sources from suppliers, and the purchase of Guarantees of Origin and Renewable Energy Certificates.

Baseline and target: Saab has committed to Science Based Targets initiative (SBTi) approved 2050 greenhouse gas emission targets (referenced on page 9 and 64). The company targets:

• Reduction in Scope 1 & 2 CO₂e emissions by 42% (compared to 2020 baseline) by 2030
• Reduction in Scope 3 CO₂e emissions by 25% (compared to 2020 baseline) by 2030
• Net zero emissions by 2050

Scope 3 emissions

Scope 3 data is referenced but not provided in detailed tabular format in the excerpts. The report indicates:

• Scope 3 emissions are material and subject to SBTi-approved targets (25% reduction vs 2020 by 2030)
• The company is expanding reporting to include additional Scope 3 categories in 2024
• For newly added Scope 3 categories, 2023 comparison figures have not been subject to assurance in previous years

No complete Scope 3 breakdown by GHG Protocol categories 1-15 is provided in the excerpts.

Total GHG emissions

Total GHG emissions (Scope 1 + 2 + 3) are not explicitly disclosed in the excerpts provided.

GHG intensity

No GHG intensity metric (e.g., tCO₂e per million EUR revenue) is disclosed in the excerpts provided.

Regulated emissions

No separate disclosure of regulated emissions (e.g., EU ETS) is provided in the excerpts.

Biogenic CO₂ emissions

No separate reporting of biogenic CO₂ emissions is provided in the excerpts.

Scope 1 sub-breakdown

No sub-breakdown of Scope 1 into stationary combustion, mobile combustion, process emissions, or fugitive emissions is provided in the excerpts.

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

Phase-in exemption applied

Saab is using the phase-in exemption for ESRS E1-9. The disclosure requirement table on page 138 shows:

No quantified financial effects, time horizons, methodologies, or specific CapEx/OpEx implications are disclosed for this reporting period.

Substances of Concern

Targets and Actions

• Tools deployed for efficient handling of product life cycle data
• Define and set target to minimise the use of "Target substances" (based on Product Compliance Programme outcome)
• Challenge to meet the targets in Scope 3 - use of products. Dependency on availability of Sustainable Aviation Fuel
• Phase out of substances of concern and substances of very high concern

Progress were made within "Substances of concern" however we did not accomplish internal targets. Saab will further focus on these areas in 2025.

Circular Economy Targets

• Operate with circular industrial processes and develop circular products in line with definitions from the EU Circular Economy Action Plan (EU CEAP)

Policies related to own workforce

Saab has established several policies and frameworks governing its approach to own workforce, grounded in the Code of Conduct and supported by dedicated policies on specific workforce topics.

Code of Conduct

Policy name: Code of Conduct ("Our Code")

• Scope: Applies to all employees at Saab
• Governance: Adopted by the Board of Directors; authorised and signed by the CEO
• Key content/principles: Serves as the foundation for all actions, outlining standards and principles that guide every employee in making responsible decisions. Contains ethical guidelines on how the company and its employees are expected to act in contact with customers, business partners, in society, and in their interaction with one another as colleagues
• Public availability: Accessible to employees through onboarding programs and recurring mandatory training sessions; available on dedicated information portals on Saab's intranet and within Saab's Global Management System (GMS)
• Link to international standards: Saab adheres to the United Nations Guiding Principles for Business and Human Rights and the OECD's six steps for human rights due diligence, ensuring fair and equal working conditions throughout the entire value chain
• Monitoring: Digital Code of Conduct training is mandatory for all employees. A new mandatory e-learning launched in 2024 focuses on values, decision support and speak up. Employees are expected to report violations through normal line reporting or Saab's Whistleblowing hotline. Whistleblowing statistics and investigation outcomes are reported to the Ethics and Compliance Board and Audit Committee

Occupational Health and Safety Policy

Policy name: Occupational Health and Safety Policy

• Scope: Applies to all Saab operations globally; extends to all individuals working on Saab premises, including Saab's own employees and external parties under Saab's control
• Governance: Authorised and signed by the CEO. Line managers are directly responsible for the health and safety of their teams; dedicated Occupational Health and Safety Coordinators or specialists provide support at local level; Group function Human Resources provides processes, guidelines, and ensures compliance with policies and relevant regulations
• Key content/principles: Ensures a safe and secure work environment by: work environment management with focus on promoting good health; identifying and managing work environment; prevention of accidents, ill health and work-related injuries in short and long term; engaging and involving employees in work relating to work environment; encouraging employees to maintain good balance in life and to look after their own health and the health of others; no toleration of any form of harassment, reprisals, bullying or other physical or verbal acts of an abusive nature
• Public availability: Part of Saab's Global Management System (GMS); available on Saab.com
• Link to international standards: Global ISO 45001 certification for Occupational Health and Safety Management Systems
• Monitoring: OHS targets and KPIs are followed up quarterly by management for Human Resources; evaluation of performance takes place annually in the Management Review; digital support system implemented globally in 2024 to support proactive OHS activities and follow-up performance

Place of Work Policy

Policy name: Place of Work Policy

• Scope: Applies wherever Saab conducts operations
• Governance: Authorised and signed by the CEO
• Key content/principles: Ensures a safe and secure work environment. The majority of Saab employees have their workplace/workspace at Saab. When work situation permits, it is possible to work remotely/from home. How and where employees conduct work is dependent on line of work and needs to be balanced against the ability for the individual, team and organization to be compliant and reach delivery targets
• Public availability: Not specified
• Link to international standards: Not specified
• Monitoring: Not specified

Diversity and Inclusion Policy

Policy name: Diversity and Inclusion Policy

• Scope: Applies to employees
• Governance: Authorised and signed by the CEO
• Key content/principles: Provides a framework that governs and guides diversity and inclusion work. Emphasises the importance of employees seeing the value of diversity, that everyone treats each other with respect and consideration, and that all forms of discrimination should be prevented. States that Saab strives for all employees to have the same perceived opportunities throughout the company regardless of who they are
• Public availability: Not specified
• Link to international standards: Not specified
• Monitoring: Diversity and inclusion work is incorporated into engagement work within Saab, both at corporate level and in business areas

People Strategy

Policy name: People Strategy

• Scope: Not specified
• Governance: Not specified
• Key content/principles: Provides a comprehensive framework for goals and activities related to workplace health
• Public availability: Not specified
• Link to international standards: Not specified
• Monitoring: Not specified

Additional policy frameworks

Saab's commitment to human rights is embedded across policies. The company complies with national labour laws and agreed collective agreements, providing job security for employees. Saab is committed to developing its leaders by equipping them with skills and knowledge to inspire teams, drive innovation, and promote a workplace built on diversity and inclusion.

Accessibility and transparency are key to Saab's approach. Policies are available to employees through various channels, including onboarding programs and recurring mandatory training sessions. The CEO authorises and signs all policies, while the Board of Directors adopts the Code of Conduct, demonstrating high level of commitment from leadership.

Taking action on material impacts on own workforce

Overall Approach

Saab is actively addressing the challenges in the current situation with onboarding vast number of new employees, expanding our facilities, and managing a growing talent pool. Focus is within the areas of creating a safe and inclusive workplace, responsible workforce management and improving employee engagement.

Actions during the year include, but is not limited to, diversity and inclusion training, invest in employee development, training, and career progression, investment in leadership development programs as well as holding regular employee surveys to track the effectiveness of the actions.

Occupational Health and Safety Actions

Training on incident reporting (2024)

• What: Training of employees in Sweden emphasising the importance of reporting and addressing risks at an early stage including proactive measures
• Scope: Own operations (Sweden)
• Outcome: Led to an overall increased awareness and the reporting rate

Root cause analysis and InControl tool development (planned 2025)

• What: Train the organisation in a methodology for root cause analyses and to continue to develop the Tool InControl in Sweden
• Scope: Own operations (Sweden)
• Time horizon: Short-term (2025)

Awareness campaign on safety incident reporting (ongoing)

• What: Ongoing work to create awareness regarding the importance of reporting safety incidents. A simplified process for reporting of near misses and hazard identifications will be implemented
• Scope: Own operations
• Monitoring: Performance will be followed up at local level in the organisation to provide support and implement measures where needed

Psycho-social work environment training (2024-2025)

• What: Introduced a training session "Inclusion and collaboration - for a sustainable work environment". Managers were given tools for supporting the dialogue about collaboration and inclusion within their teams
• Scope: Own operations
• Time horizon: 2024 implemented; 2025 planned extension
• Planned 2025: A communication package is planned to be provided to managers on how to report psycho-social work environmental incidents

Work-life balance enhancement (2025)

• What: Saab is committed to improving employee well-being and during 2025 we aim to enhance employees' perceived work-life balance
• Time horizon: Short-term (2025)
• KPIs: This will be measured through our employee surveys and the work-life balance will be measured twice during 2025 allowing us to track progress and implement timely measures

Diversity and Inclusion Actions

Raising awareness and knowledge (2024)

• What: Saab conducted training programmes, launched information campaigns, and organised dedicated diversity and inclusion initiatives and workshops to educate employees and managers
• Scope: Own operations
• What: Saab promoted women leadership by showcasing role models, and encouraging participation in leadership development programmes

Promoting an inclusive workplace (2024)

• What: Saab's annual Occupational Health and Safety training for employees focused on inclusion and collaboration, emphasising the importance of creating a respectful environment for all
• Scope: Own operations

Inspiring future generations (2024)

• What: Saab engaged in initiatives to spark women's interest in technology and engineering, participating in events, collaborating with women networks, hosting students, and conducting school visit (STEM outreach)
• Scope: External engagement / community
• What: Saab integrated diversity principles into recruitment practices, job advertisements, and interview processes. This included training for managers and recruiters on inclusive hiring practices

Training and Skills Development Actions

Continuous learning and professional growth (2024)

• What: Through a range of learning opportunities, such as seminars, programmes, learning libraries, workshops, and interactive sessions, our employees gain the skills needed to promote an inclusive and respectful workplace
• Scope: Own operations
• Outcome: These initiatives enhance awareness and equip both leaders and employees to actively contribute to a diverse, innovative, and collaborative environment

Performance process improvements (2024)

• What: Steps were taken in 2024 to improve the ongoing performance process by updating support materials in how managers can support employee performance throughout the year, as well as ensuring that employees can drive their own development by clarifying development opportunities
• Scope: Own operations
• Process: The performance process drives, facilitates, supports and monitors individual performance. It is an ongoing process aiming to creating favourable conditions for employees to perform and develop in their jobs, and to create an environment for self-driven learning in the flow of work

Targets Linked to Actions

Occupational Health and Safety

• Target for 2024: Break the upward trend of reported work-related accidents (number of TRIs by end of 2024 should not exceed previous year)
• Target for 2025: Total Recordable Injury Frequency Rate (TRIFR) should not exceed 4.76 (2024 value)
• Long-term target (2030): TRIFR value should decrease with 25%, compared to base year 2024
• Target for close calls/hazard identification: 5.0 reported per work-related injury (2024 actual: 4.1)
• Work-life balance target (2025): Improve employees' perceived work-life balance, measured twice a year through employee surveys

Diversity and Inclusion

• Target by 2025: 25% women employees (achieved) and 30% women managers
• New target by 2030: 30% women employees
• Training target (introduced 2024): 40 hours of training per employee per year

Monitoring and Effectiveness

• Occupational Health and Safety targets and KPIs are followed up quarterly by the management for Human Resources
• Evaluation of performance also takes place annually in the Management Review
• For diversity and inclusion actions, effectiveness tracked through employee surveys

Workforce-Related Targets

Diversity and Inclusion Targets

• At least 30% women employees
• At least 35% women managers
• Incorporation of Diversity and Inclusion target in the Performance Share Plan

Learning and Development

• Saab establshed a target of 40 learning hours per employee per year

Occupational Health and Safety

• Reduce number of work-related accidents, measured by decreased TRIFR by 25% (compared to 2024)
• Improve employees experienced work life balance and reach benchmark top 25th percentile (8.3)

Progress Update

Progress were made however we did not accomplish internal targets on OHS-targets and share of women managers. Saab will further focus on these areas in 2025.

Employee Characteristics

Total Workforce

• 24,500 employees globally as of 2024
• Nearly 3,000 new employees recruited in 2024 (13% increase)
• 24% of Saab's new employees were located in markets outside of Sweden

Geographic Distribution

• Sweden: 19,612 employees
• United States: 1,041 employees
• Australia: 1,025 employees
• United Kingdom: 520 employees
• Germany: 470 employees
• South Africa: 418 employees
• Finland: 265 employees
• Denmark: 254 employees
• UAE: 168 employees
• Brazil: 147 employees
• Switzerland: 121 employees
• Czech Republic: 78 employees
• Netherlands: 60 employees
• Poland: 42 employees
• Norway: 38 employees
• Singapore: 30 employees
• South Korea: 23 employees
• Other: 211 employees

R&D Workforce

• 11,700 employees engaged in R&D

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

Number of non-employees in own workforce

Number of non-employees, has net increased by 825 in comparison to the end of 2023, a 24% net increase.

Limited assurance: [S1-7] 55a

Accounting Principles

The number of non-employees represents full time equivalents of all non-employees in own workforce at the end of the reporting period. Figures shown in table represent 100% global data coverage.

Diversity Metrics

Gender Distribution

• Women: 26%
• Men: 74%

Diversity Targets

• At least 30% women employees
• At least 35% women managers

Progress

Saab achieved internal targets for share of women employees but did not accomplish internal targets on share of women managers. Saab will further focus on these areas in 2025.

Social protection

Defined-benefit pension plans

Saab operates defined-benefit pension plans primarily in Sweden, USA, and Switzerland. As of 31 December 2024, the funded status of these plans was:

Sweden: The predominant plan is the ITP plan under collective agreements. The ITP2 plan (defined-benefit) covers individuals born 1978 and before, while ITP1 (defined-contribution) covers those born 1979 and after. The Saab Pension Fund had assets of MSEK 9,346 compared to an obligation of MSEK 10,326 as of 31 December 2024, representing a solvency margin of 91%.

Switzerland: Operates a defined-benefit plan that includes all employees with minimum benefits prescribed by law. The company is affiliated with a collective foundation, with provisions made by both employer and employees.

USA: Supplementary plan for individuals in executive positions.

Defined-contribution plans

Obligations for fees to defined-contribution plans are expensed through the income statement. No quantitative coverage data disclosed for defined-contribution plans.

Other social protection

No disclosure provided regarding coverage percentages for sickness, maternity, paternity, disability, unemployment, or employment injury benefits.

Training and Skills Development

Learning Target

• Saab established a target of 40 learning hours per employee per year

Development Programs

During the year, Saab expanded its people development, upskilling and learning platforms through its CareerHub, promoting continuous learning and internal mobility within the Group. The Saab "gig" is one such programme which connects talents with opportunities to leverage their experiences and skills in a new competence area or division.

People Strategy Focus Areas

Saab's people strategy builds on four pillars:

• Securing future workforce, leaders and competences
• Transforming the way we work, enabling improved performance and efficiency
• Accelerating continuous learning
• Creating the best people experience

Health and safety metrics

Coverage of health and safety management system

100% of own workforce (employees and non-employees) are covered by Saab's health and safety management system. The OHS management system is part of Saab's minimum level procedures; all employees and non-employees that work under Saab's management are covered.

Fatalities and recordable work-related accidents

¹ 2023 TRI data updated: the number of TRIs that occurred in 2023 increased to 135 from the previously reported 110 due to incidents developing into TRIs after year-end. Previously reported TRIFR was 3.17.

Calculation methodology

Rate of recordable work-related injuries (TRIFR) and rate of lost time injuries are calculated per 1,000,000 hours worked. For 2024, total workforce hours worked: 45,941,863 (employees: 39,089,565; non-employees: 6,852,298). The ratio of number of LTI or TRI divided by number of hours worked is multiplied by 1,000,000.

Data quality notes

During 2024, changes were made in the extracting of TRI data through improved system logic that automatically categorises incidents into TRIs, eliminating human interpretation. This led to an increase in incidents categorised as TRIs. There is uncertainty connected to TRI numbers as incident categorisation depends on how the injury and rehabilitation develop; an incident can develop into a TRI over time. A verification of the previous year's TRI data takes place in Q4/Q1 yearly to ensure incidents categorised as TRIs after year-end are identified. No breakdown between employees and non-employees is available for 2023 comparative data. Information on work-related illness is only available for employees for 2023.

Work-Life Balance

Target

• Improve employees experienced work life balance and reach benchmark top 25th percentile (8.3)

Progress

Progress were made however we did not accomplish internal targets on work-life balance metrics. Saab will further focus on these areas in 2025.

Compensation metrics

Pay gap

Gender pay gap: 0.91 (2024), 0.91 (2023), 0.91 (2022)

Remuneration ratio

Annual total remuneration ratio: 26.59 (2024), 23.93 (2023), 23.75 (2022)

The annual total remuneration ratio illustrates the disparity between the highest-paid individual and the median compensation of the other employees.

Methodology

Data is extracted from Saab's HR system. Data for employees in 11 countries are included in the calculations, covering 96% of the workforce. For the comparative figures 2023, 9 countries were included, covering 93%. For the comparative figures from 2022, 9 countries were included covering 86% of the workforce.

The median of monthly base salary has been taken into consideration. The salary has been calculated as full time equivalent.

Incidents, complaints and severe human rights impacts

Saab references ESRS S1-17 disclosures on pages 75 of the Annual & Sustainability Report 2024:

• Paragraph 103 (a) - Incidents of discrimination: Referenced as Indicator number 7, Table #3 of Annex I, disclosed under "General" materiality category on page 75 in the Risks and Uncertainties section.

• Paragraph 104 (a) - Non-respect of UNGPs on Business and Human Rights and OECD: Referenced as Indicator number 10, Table #1 and Indicator n. 14 Table #3 of Annex I, disclosed under "General" materiality category on page 75.

The index table indicates these disclosures are located on page 75, but the specific quantitative data (number of incidents, complaints, status, fines, or sanctions) is not provided in the extracted excerpts. The excerpts contain only the cross-reference index mapping ESRS requirements to page numbers.

Business Conduct and Corporate Culture

Values and Culture

At Saab, we are guided by three core values: Trust, Drive, and Expertise. These values reflect our commitment to reliability, driving change, working efficiently, and continuously learning and collaborating. They are the foundation of our ambition to be a preferred employer, creating a workplace where talent thrives and contributes to the shared success.

UN Global Compact Commitment

Saab is a dedicated member of UN Global Compact since 2011 and pledge to follow its ten principles on human rights, labour, environment and anti-corruption.

Business and Human Rights

Saab recognises the responsibility that comes with developing and selling advanced security and military equipment. Our commitment to respecting human rights involves every stage of our value chain, from sourcing materials and sub-systems, to delivering products and services. This commitment is rooted in our values and aligns with international frameworks, such as the UN Global Compact and the UN Guiding Principles on Business and Human Rights.

Responsible Sales Framework

Saab has implemented a robust Responsible Sales Policy together with a Group-wide framework that guides our due diligence process and ensures responsible decision-making throughout the sales cycle. This framework complements existing national export controls and bridges gaps between international legislations, allowing us to uphold international sustainability standards and national security interests.

Our Responsible Sales framework incorporates a risk screening process for all new business opportunities. High-risk opportunities, identified through a combination of factors, undergo a comprehensive due diligence process. This process involves identifying potential adverse impacts, evaluating potential mitigation strategies and making informed decisions about whether to proceed with the sale.

Anti-Corruption and Bribery

Industry-Leading Programme

Saab has an industry-leading anti-bribery and corruption programme. This is identified as one of the key areas within the "Resilient and safe societies" pillar of Saab's sustainability strategy.

Progress Achievement

Saab has reached its targets within all the topics within the strategic focus area "Resilient and safe societies", which includes the anti-corruption programme.

Incidents of corruption or bribery

Confirmed incidents

Saab has had no significant instances or has not paid any significant monetary value of fines for instances of noncompliance with laws and regulations during the reporting period. The disclosure is based on information from the areas of Anti-Corruption, Environment, Occupational Health and Safety, Data Integrity, Export Control, Tax and Human Rights.

Convictions and fines

No convictions or fines for violations of anti-corruption and anti-bribery laws were reported for 2024.

Disciplinary actions

Number of individuals subject to disciplinary action 2024: 5

This figure is associated with the broader whistleblowing reports received during the year (59 total reports across various categories including bribery and corruption).

Whistleblowing hotline reports

Saab recorded 59 total reports to the Whistleblowing Hotline in 2024, an increase from 30 in 2023. Breakdown by issue type:

Investigation procedures and speak-up mechanisms

Saab has established a Whistleblowing Hotline hosted by an external party that allows employees and external parties to report anonymously online or by phone. Reporting can also be made through normal line reporting channels, to a line manager, Human Resources, an Ethics and Compliance Officer, or to the Legal department.

Saab has a Whistleblowing Policy and investigation instruction. Reports are handled by a designated investigation team to safeguard objectivity, confidentiality and integrity. Within Group Ethics and Compliance there is a dedicated function to develop and coordinate investigation routines and assess the effectiveness of whistleblowing channels. Whistleblowing statistics and investigation outcomes are reported to the Ethics and Compliance Board and Audit Committee.

Saab does not tolerate any form of retaliation. The increase in reports from 30 to 59 is likely due to the release of the new Code of Conduct during the reporting period and more attention to speak-up channels. The development is considered positive and reflects a sound and healthy culture.

Public legal cases

Saab has an ongoing complaint (filed 2021) at the Australian OECD National Contact Point for Responsible Business Conduct (NCP), which is likely to be resolved during 2025. Saab has cooperated fully with the NCP regarding the complaint. Saab did not receive any response requests from the Business and Human Rights Resource Centre during the year.

Political influence and lobbying activities

Political engagement approach

Group Government Affairs is a business-driven organisation that engages with key stakeholders, including government officials, regulators, industry associations, the EU, NATO and other strategic partners, to proactively promote and advocate Saab's positions and business conditions. The Senior Vice President & Head of Group Government Affairs leads and oversees the organisation.

All activities are conducted in accordance with Saab's Code of Conduct. Group Government Affairs primarily operates in Sweden and within the EU and NATO organisations through its Brussels office, with additional presence in Saab's strategic markets. Saab's advocacy work always complies with applicable laws and regulations in every country where it operates.

Ethical standards and guidelines

Saab's Code of Conduct is globally applicable and supported by policies, instructions, and processes that may incorporate country-specific variations to ensure alignment with local legislation. The Code also encompasses cooperation with governments. Interacting with decision-makers on matters related to national security and defence is an integral part of Saab's mission and must always be conducted responsibly.

Key advocacy activities in 2024

During the 2024 financial year, Saab collaborated with governments and agencies to coordinate activities that support business opportunities for exports of Gripen aircraft, submarines and GlobalEye systems. Saab has received support from the Swedish state when it serves Swedish defence interests. To further support export opportunities, Saab has also worked with governments in other countries including the United States, the United Kingdom, and Germany.

Saab has analysed and communicated the important role of the defence industry in national security. This analysis has emphasised the need for a Swedish defence industry strategy that ensures long-term material supply, with a particular focus on underwater defence and fighter aircraft. These areas are of strategic importance to Saab's operations in Sweden, where the company's position is that long-term planning creates conditions for sustainable growth and development.

Saab has participated in governmental councils on current topics, including the Defence Innovation Council. Through this dialogue, Saab has underscored the importance of a triple-helix approach to innovation and advocated for increased investments in future capabilities. Saab has also collaborated closely with the Swedish Security & Defence Industry Association (SOFF), an important platform for coordinating with other Swedish defence companies.

Saab has continued its active involvement in the European Defence Fund (EDF), collaborating on research and technology initiatives with other key players in the European defence industry. Saab believes that such research, development and technological partnerships will drive innovation, enhance competitiveness, and create new opportunities for significant partnerships within the European defence market. Through the Alliance for Securing Democracy (ASD) and independent efforts, Saab has informed the EU process leading to the adoption of the Regulation for a Defence Industrial Strategy (EDIS). Saab is also actively engaging in the process surrounding the European Commission's proposed EU Defence Industry Programme (EDIP). To further strengthen its influence, Saab has expanded its EU affairs team and remains committed to solidifying its position as a leading stakeholder.

Sweden's NATO membership has created new opportunities for cooperation and engagement. Saab has developed networks with NATO structures and agencies, as well as allies' national representations and industry partners, in order to promote Saab's position within the Alliance and contribution to NATO's mission. Saab has taken an active role in the NATO Industrial Advisory Group (NIAG), participated in working groups focused on enhancing industrial capacity, and engaged in NIAG studies.

EU Transparency Register

Saab is registered in the EU transparency register with registration number: 86477889163-49.

Political contributions

Saab does not use company funds to sponsor political parties or candidates, in accordance with its Code of Conduct. However, in the United States, employees may make personal political donations, in compliance with local regulations (exact amount is not available).

Material topic status

In the double materiality assessment 2024, Political engagement was added as a new material topic. The new material topic will be integrated into the sustainability strategy and fully reported 2025.