Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698061163991.pdf (Liberia)
Statkraft’s Double Materiality Analysis 2022 Our methodology aligns to double materiality Reporting standards and frameworks are clarifying their focus on single versus double materiality.
• Considers the company’s impacts outwards • Uses the GRI definition: “topics that reflect its most significant impacts on the economy, environment and people, including impacts on human rights” • For multiple stakeholders 2 Double materiality means that businesses should report on financially material topics that influence the business value as well as topics material to the economy, environment, and people.
• Considers the company’s impacts inwards • For investors, lenders and other creditors Methodology: The Prioritization Process 2 Desktop research and draft scoring 1 Identify list of sustainability topics relevant to Statkraft based on all the standards • CSRD • ESRS • SFDR • SDGs • SASB • GRI • Human Rights Conventions # 1 Category Topic Definition Environm ent Nature and Biodiversit y Business impacts on biodiversity of ecosystems on land and in water.
This includes, but not limited to, impact on red-list species, biodiversity loss or change in distribution (reproduction or immigration) of local species, critical habitats, and protected areas.
• Reviewed internal Statkraft documents, public resources and BSR expertise • Across topics, the team scored Impact on Business and Impact on Society and Environment • Aligned with Statkraft’s ERM Framework 3 Focus group interviews to identify and assess impacts and collect feedback on draft ratings • • 28 Internal stakeholders 4 External stakeholders 4 Revised assessment 5 Validate matrix during workshop 6 Topic Nature and Biodiversity Impact on Business (x axis) Impact on Society and the Environment (y axis) 1.8 3.3 3 • • • Workshop objectives • Ensure understanding of materiality process and outputs Share initial materiality assessment results and insights for Statkraft’s materiality matrix Confirm alignment on the position and relative importance of material topics identified Seek general feedback on the initial materiality matrix Final materiality assessment results, which includes: • Feedback from the Workshop workshop • Input shared after the workshop by participants Long List of Material Topics The materiality process starts by identifying a “long list” of potentially material topics.
We developed the following list of relevant sustainability topics that were prioritized and plotted on the materiality matrix, and describe each topic’s impact on business and impact on society and the environment.
Category Topic Name Environment Nature and Biodiversity Environment Environment Climate Adaptation – Physical Risks Climate Adaptation – Transition Risks Environment Climate Mitigation Environment Waste & Circularity Environment Air Pollution Environmental Responsible Water Management Social Social Social Social Social Social Social Social Social Forced Labor Child Labor Security of people Cyber- & Asset Security Data Privacy & Protection Occupational Health & Safety Living Wage & Compensation Social Security & Employee Wellbeing Working Hours & Overtime Pay Category Topic Name 26 27 28 29 30 Social Social Social Social Governance Governance Governance Governance Governance Governance Governance Governance Governance Governance Freedom of Association Local community impact Land rights Indigenous rights Non-discrimination & Equality Access to Energy Talent Acquisition & Development Employment & Job Creation Anti-Corruption Competitive Behavior Public Policy & Regulation Responsible Procurement Responsible Tax Practices Access to Remedy Materiality Matrix Impacts related to Land Rights, Updated topic location: Nature and Biodiversity and Local Community Impact, and Climate Mitigation are the most significant Physical Risks impacts on Society and Environment.
• Climate Adaptation - • Cyber- & Asset Security Impacts related to Responsible Water Management and Occupational • Living Wage & Health & Safety are the most Compensation significant impact on Statkraft’s business.
• Anti-Corruption • Public Policy & Regulation • Access to Remedy 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.8 1.5 1.0 0.5 0. Access to Energy Employment & Job Creation Talent Acquisition & Development Local community impact Land Rights Nature and Biodiversity Climate Mitigation Occupational Health & Safety Indigenous rights Forced Labor Public Policy & Regulation Security of people Cyber- & Asset Security Anti-Corruption Responsible Procurement Freedom of … Responsible Water Management Waste & Circularity Environment Governance Social Access to Remedy Social Security & … Responsible Tax Practices Working Hours & Overtime Pay Climate Adaptation -… Non-discrimination & Equality Competitive Behavior Living Wage & Compensation Child Labor Data Privacy & Protection Air Pollution Climate Adaptation - Transition Risks 0.5 1 1.5 1.8 2 2.5 3 3.5 4 4.5 5 5 Impact on Business Interpreting the Materiality Matrix High 4.5 4 3.5 3 2.5 2 1.5 1 0.5 A D B C Topic placement on the map indicates the impact it has inward and outward.
For impact-materiality the threshold for material topics is 1.8, which is a medium impact.

What each zone means: A.

High impact on the society and environment & Small impact on business Mitigate, Promote, Address & Communicate Impacts outward and emerging topics B.
High impact on the society and environment & Large impact on business Governance Prioritize Strategic issues C. Low impact on the society and environment & Large impact on business Mitigate, Promote & Address Impacts inward D. Low impact on the society and environment & Small impact on business Monitor Tablestakes Low 0 0 6 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 Small Impact on Business Large Stakeholder Key Insights, Observations, and Reflections (1/2) While opportunities and risks vary depending on the specific renewable energy technology and the geography of the asset, common findings for Statkraft related to high demand for RE include the following: Rapid growth of RE brings both opportunities and challenges Rapid growth of RE brings both opportunities and challenges The energy crisis will increase focus on access to affordable energy License to operate is increasingly at risk due to land and community issues 7 Growth and expansion will lead to cumulative impacts, both positive (e.g.
climate mitigation) and negative, by the sheer scale of the future operations.

This might lead to challenges to maintain high standards on H&S outside of Europe, attract and keep talent, and increased risk of corruption with intermediaries.

It is about striking a balance between keeping fossil fuels off the grid and increasing RE, while minimizing negative impacts on people and the environment.

Statkraft should seek to balance safeguarding value of existing assets and growing its RE assets.
While the focus on access to affordable energy has increased the last few years, this is expected to grow in the coming years.

Statkraft can have a significant positive impact on this issue, and therefore should consider including this as a strategic topic.

Challenges relate to uncertainty in the energy markets and government intervention.

There are opportunities to communicate on how renewable energy can support access to affordable energy and strengthen energy security.
With increasing energy demands throughout technologies, land take issues are increasing.

Pushback from communities may lead to delays and project execution for Statkraft.

To keep its license to operate, Statkraft should focus on community engagement, such as co-ownership of projects, local hiring and local procurement.
Stakeholder Key Insights, Observations, and Reflections (2/2) While opportunities and risks vary depending on the specific renewable energy technology and the geography of the asset, key sustainability topics to increase focus on include the following: Communicate and raise the bar on impacts on biodiversity and nature As a RE project developer, Statkraft will always have an impact on biodiversity and nature.
There is an opportunity to be proactive on the topic and implement more than national authorities require, raising the bar specifically in non- Nordic countries.

To comply with upcoming regulations and respond to society scrutiny Statkraft can communicate more about their impacts, both negative and positive.

Develop a strategy on waste and circularity Waste and circularity is an emerging issue for the industry.
As first-generation equipment for solar and wind today reaches end of life, waste to landfill will increase.

Regulation and stakeholders expect companies to focus on circularity and report on their impacts.

While some Statkraft peers have committed to ban land filling turbine blades, Statkraft has not made any commitments yet.

While an industry-wide response is needed, circular models will also help Statkraft hedge against risks of supply chain disruption.
Monitor supply chain risks to identify “what is next”?

Companies are increasingly expected to act beyond compliance across their value chain.

The company is aware of key current risks in the supply chain such as forced labor in solar supply chain, and with contractors on site.

However it is key to proactively monitor emerging risks and impacts across the supply chain by conducting environmental and social due diligence.

Regulations like the Norwegian Transparency Act require this.
Transparency and Regulatory Requirements 8 The legal landscape is changing rapidly, where companies are expected to disclose more.

CSRD requires businesses to report on financially material topics that influence business value as well as topics material to the economy, environment, and people.

Statkraft should continue to participate and be an active partner in discussions and processes on policy and regulation where the company operates.

Statkraft’s biggest risk is to keep up with regulation.
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