7437000ZP669LKUTZ738 2022-01-01 2022-12-31 iso4217:EUR 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 iso4217:EUR xbrli:shares 7437000ZP669LKUTZ738 2022-12-31 7437000ZP669LKUTZ738 2021-12-31 7437000ZP669LKUTZ738 2020-12-31 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:IssuedCapitalMember 7437000ZP669LKUTZ738 2020-12-31 se:SharePremiumAndReserveFundMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:OtherEquityInterestMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:TreasurySharesMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:ReserveOfGainsAndLossesFromInvestmentsInEquityInstrumentsMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:RevaluationSurplusMember 7437000ZP669LKUTZ738 2020-12-31 se:OciOfEquityAccountedInvestmentsMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:RetainedEarningsMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 7437000ZP669LKUTZ738 2020-12-31 ifrs-full:NoncontrollingInterestsMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:IssuedCapitalMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 se:SharePremiumAndReserveFundMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:OtherEquityInterestMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:TreasurySharesMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:ReserveOfGainsAndLossesFromInvestmentsInEquityInstrumentsMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:RevaluationSurplusMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 se:OciOfEquityAccountedInvestmentsMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:RetainedEarningsMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 7437000ZP669LKUTZ738 2021-01-01 2021-12-31 ifrs-full:NoncontrollingInterestsMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:IssuedCapitalMember 7437000ZP669LKUTZ738 2021-12-31 se:SharePremiumAndReserveFundMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:OtherEquityInterestMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:TreasurySharesMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:ReserveOfGainsAndLossesFromInvestmentsInEquityInstrumentsMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:RevaluationSurplusMember 7437000ZP669LKUTZ738 2021-12-31 se:OciOfEquityAccountedInvestmentsMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:RetainedEarningsMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 7437000ZP669LKUTZ738 2021-12-31 ifrs-full:NoncontrollingInterestsMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:IssuedCapitalMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 se:SharePremiumAndReserveFundMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:OtherEquityInterestMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:TreasurySharesMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:ReserveOfGainsAndLossesFromInvestmentsInEquityInstrumentsMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:RevaluationSurplusMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 se:OciOfEquityAccountedInvestmentsMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:RetainedEarningsMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 7437000ZP669LKUTZ738 2022-01-01 2022-12-31 ifrs-full:NoncontrollingInterestsMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:IssuedCapitalMember 7437000ZP669LKUTZ738 2022-12-31 se:SharePremiumAndReserveFundMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:OtherEquityInterestMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:TreasurySharesMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:ReserveOfGainsAndLossesFromInvestmentsInEquityInstrumentsMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:RevaluationSurplusMember 7437000ZP669LKUTZ738 2022-12-31 se:OciOfEquityAccountedInvestmentsMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:RetainedEarningsMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 7437000ZP669LKUTZ738 2022-12-31 ifrs-full:NoncontrollingInterestsMember
Stora Enso Oyj
Financial Report 2022

Stora Enso Salmisaarenaukio 2 P.O. Box 309 FI-00101 Helsinki, Finland Tel: + 358 20 46 111 www.storaenso.com |  | Business ID 1039050-8 VAT No FI 10390508

Contents

Report of the Board of Directors (unaudited) |
Stora Enso introduction |
Markets and deliveries |
Operational key figures, items affecting comparability and other non-IFRS measures |
Financial results – Group |
Financial results – Segments |
Investments and capital expenditure |
Innovation, research and development |
Non-financial information |
EU taxonomy |
Environmental liabilities |
Risks and risk management |
Climate-related financial disclosures (TCFD) |
Corporate governance |
Legal proceedings |
Changes in Group management |
Share capital |
Outlook and short-term risks |
Annual General Meeting |
Proposal for the distribution of dividend |
Non-IFRS measures |
Calculation of key figures |
Consolidated financial statements (audited) |
Consolidated income statement |
Consolidated statement of comprehensive income |
Consolidated statement of financial position |
Consolidated cash flow statement |
Supplemental cash flow information |
Statement of changes in equity |
Notes to the consolidated financial statements (audited) |
Note 1 Accounting principles |
Note 2 Critical accounting estimates and judgements |
Note 3 Segment information |
Note 4 Acquisitions, disposals and assets held for sale |
Note 5 Other operating income and expense |
Note 6 Personnel expenses |
Note 7 Board and executive remuneration |
Note 8 Net financial items |
Note 9 Income taxes |
Note 10 Depreciation, amortisation and impairment charges |
Note 11 Intangible assets and property, plant and equipment |
Note 12 Forest assets |
Note 13 Equity accounted investments |
Note 14 Equity instruments |
Note 15 Emission rights and other non-current assets |
Note 16 Inventories |
Note 17 Operative receivables |
Note 18 Shareholders' equity |
Note 19 Non-controlling interests |

Note 20 Post-employment benefits |
Note 21 Employee variable compensation and equity incentive schemes |
Note 22 Provisions |
Note 23 Operative liabilities |
Note 24 Financial risk management |
Note 25 Fair values |
Note 26 Debt |
Note 27 Derivatives |
Note 28 Cumulative translation adjustment and equity hedging |
Note 29 Commitments and contingencies |
Note 30 Principal subsidiaries and joint operations |
Note 31 Related party transactions |
Note 32 Earnings per share |
Note 33 Events after the reporting period |
Parent company Stora Enso Oyj financial statements (audited) |
Notes to the parent company financial statements (audited) |
Signatures for the financial statements |
Auditor's Report |

The official audited financial statements in Finnish and an unofficial Swedish translation are available at storaenso.com/download-centre
The audit firm PricewaterhouseCoopers Oy has provided an independent auditor’s reasonable assurance report only on Stora Enso’s
ESEF Financial Statements in Finnish in accordance with ISAE 3000 (Revised).
Unaudited 2
Report of the Board of Directors
Introduction to Stora Enso
Part of the global bioeconomy, Stora Enso is a leading provider of renewable products in
packaging, biomaterials, and wooden construction, and one of the largest private forest owners
in the world. We believe that everything that is made from fossil-based materials today can be
made from a tree tomorrow. Sustainability and responsible business practices are deeply
embedded in our strategy. Stora Enso contributes to the transformation towards a biobased
circular economy in three areas where we have the biggest impact and opportunities: climate
change, biodiversity, and circularity.
With our low-carbon and recyclable fiber-based products, we support our customers in
meeting the demand for renewable eco-friendly products.
Stora Enso had 21,790 employees on average during 2022. Our sales in 2022 were EUR
11.7 billion, with an operational EBIT of EUR 1,891 million. Stora Enso shares are listed at the
Helsinki (STEAV, STERV) and Stockholm (STE A, STE R) stock exchanges. In addition, the
shares are traded in the USA as ADRs.
Markets and deliveries
Demand for cartonboard remained elevated in 2022, with some dampening towards the end of
the year. Even though the pandemic still presented challenges for certain end-use segments, it
boosted others. Demand in the Asian region is stronger than the more mature European and
North American markets but was negatively affected by the zero-tolerance policy of China.
Containerboard demand started to weaken towards the end of 2022 as the result of
normalisation in consumption patterns, inflation pressuring household budgets and large
inventory draw downs in the box and finished goods markets, especially in North America and
Europe. In China, pandemic-related disruptions continued to cut containerboard demand.
The growth of European corrugated packaging demand in Stora Enso's main markets slowed
down to 1% in 2022 mainly driven by the current economic difficulties and normalisation of e-
commerce sales to pre-pandemic levels. The ongoing war in Ukraine has made consumers to
reconsider their purchasing habits which slows down the growth of corrugated packaging
demand even more. Largest sales for Stora Enso corrugated markets are in home and garden
and in grocery and retail sectors.
Global demand for chemical market pulp rebounded to 3% in 2022. Softwood pulp deliveries
decreased by 1% reflecting the weakness in Chinese softwood pulp demand. Hardwood and
unbleached kraft pulp (UKP) deliveries increased by 5% and by 13%, respectively. Demand for
fluff pulp continued strong.
The global chemical market pulp capacity increased by 2% in 2022, the softwood capacity
declined by 1% while hardwood capacity increased by 4% and UKP capacity by 6%. The overall
shipment-to-capacity balance stood at 90%, 1 percent-point up from 2021.
Higher than expected demand and several supply side and logistics disruptions kept the pulp
market tight in Europe and North America. Chinese paper and board demand continued
subdued due to weak macro economy and strict zero-covid policy. Slowing economy, inflation
and energy availability weakened pulp demand especially in Europe towards the end of year.
Global pulp inventories were generally balanced despite imparity between grades. Softwood
pulp inventories remained elevated whereas the hardwood pulp inventories were below the 5-
year average level.
Pulp prices reached the all-time high records in summer 2022. Hardwood pulp prices have
remained resilient throughout 2022 while softwood pulp prices started to soften towards
the year end.
Global sawn wood consumption decreased by some 3% in 2022 according to EOS
(European Organization of the Sawmill Industry) estimate. The market situation continued strong
in the first part of 2022. Market supply was limited and was not able to meet the high demand,
which kept the price levels high in 2022. From early summer 2022 in the USA the market
situation started to cool down and prices reduced significantly. Prices started to go down in other
markets as well during the second half of 2022. The war in Ukraine and extremely high inflation
reduced the amount of housing starts and customer confidence which led into uncertainty in the
market. During the second half and especially in Q4 the market was focusing to run inventory
levels down which led into low demand and declining price levels. According to EOS North
American demand reduced by 2% from 2021 levels and in Europe 5%. In Australia market
remained strong longer than in USA or in Europe, but also Australian market cooled down
during Q4.
Year 2022 was eventful for the paper markets. European paper demand remained healthy
during the first half of year, but started to decline sharply during the second half as result of
macroeconomic slow down. Prices increased during the whole year and reached an all-time high
level. Price increases were driven by heavily increased costs (especially energy and paper for
recycling) and balanced supply and demand. The healthy supply-demand balance was driven by
capacity closures and machine conversions. European paper demand was 10% weaker in 2022
compared to the previous year. In North America, demand increased by 2% and in Asia declined
by 2% compared to 2021. Global paper consumption was 2% lower in 2022 than in 2021.
Estimated consumption of board, pulp, sawn softwood, and paper in 2022

Tonnes, million | Europe | North America | Asia and Oceania
Consumer board | 11.2 | 9.6 | 29.4
Containerboard | 35.1 | 33.1 | 89.1
Corrugated board (billion m 2)1 | 11.0 | n/a | n/a
Chemical market pulp | 17.4 | 8.0 | 36.0
Sawn softwood (million m 3) | 78.9 | 99.9 | n/a
Newsprint | 3.6 | 1.4 | 5.8
Uncoated magazine paper | 2.1 | 0.9 | 0.1
Coated magazine paper | 2.7 | 1.2 | 2.2
Coated fine paper | 3.2 | 2.7 | 9.2
Uncoated fine paper | 5.9 | 6.1 | 28.3
1 European focus markets (Baltics, FI, PL, SE) Source: Afry Smart, ICCA, RISI, Numera, Euro-Graph, PPPC, EPIS, Hawkins Wright, Stora Enso, EOS

Unaudited 3
Production and external deliveries

| 2022 | 2021 | Change % 2022–2021
Board deliveries, 1,000 tonnes | 4,294 | 4,258 | 0.9%
Board production, 1,000 tonnes | 4,682 | 4,685 | -0.1%
Corrugated packaging European deliveries, million m 2 | 741 | 949 | -21.9%
Corrugated packaging European production, million m 2 | 771 | 1,049 | -26.5%
Market pulp deliveries, 1,000 tonnes | 2,374 | 2,495 | -4.9%
Wood product deliveries, 1,000 m 3 | 4,397 | 4,803 | -8.5%
Wood deliveries, 1,000 m 3 | 13,304 | 12,091 | 10.0%
Paper deliveries, 1,000 tonnes | 1,924 | 2,872 | -33.0%
Paper production, 1,000 tonnes | 1,926 | 2,776 | -30.6%

The Group’s board deliveries totalled 4,294,000 tonnes, which was 36,000 tonnes, or 0.9%
higher compared to a year ago. Corrugated packaging European deliveries decreased by 208
million m 2 or 21.9% to 741 million m 2 mainly due to exit from Russian operations. Market pulp
deliveries decreased by 121,000 tonnes, or 4.9%, to 2,374,000 tonnes, mainly due to higher
share of internal deliveries. Wood product deliveries decreased by 406,000 m 3 or 8.5% to
4,397,000 m 3, mainly due to exit from Russian operations. Wood deliveries increased by
1,213,000 m 3 or 10.0% to 13,304,000 m 3 supported by higher deliveries in Sweden. Paper
deliveries totalled 1,924,000 tonnes, down 948,000 tonnes, or 33.0%, from 2021, driven by the
structural changes.
Operational key figures, items affecting comparability and other non-
IFRS measures
The list of Stora Enso’s non-IFRS measures and the calculation of our key figures are presented
at the end of the Report of the Board of Directors. See also the chapter Non-IFRS measures at
the end of this report.
Financial results – Group
Group sales increased by 15% year-on-year to EUR 11,680 (10,164) million. Operational EBIT
was EUR 1,891 (1,528) million, and the operational EBIT margin was 16.2%. Earnings per share
increased by 22% to EUR 1.97 (1.61) and earnings per share excluding fair valuations increased
by 31% to EUR 1.55 (1.19).
The IFRS operating profit includes a positive net effect of EUR 195 (positive 328) million from
biological asset valuation from subsidiaries and joint operations. The positive impact comes
mainly from the increase in fair valuation in Stora Enso owned forests in Sweden, mainly driven
by higher market prices. There is also a positive net effect of EUR 168 (positive 84) million from
Stora Enso’s share of net financial items, taxes and biological asset valuation of equity
accounted investments. The positive impact comes mainly from the change in the valuation
method and increase in fair valuation in Finnish forests, through Stora Enso's 41% investment in
Tornator.
Tangible and intangible asset (including goodwill) impairments amounted to EUR 114 (149)
million. Impairment reversals amounted to EUR 7 (0) million,
The Group recorded items affecting comparability (IAC) with a negative impact of EUR 245
(negative 354) million on its IFRS operating profit and a positive impact of EUR 9 (positive 58)
million on income taxes. The IAC relate mainly to the disposal of Russian operations.
The IFRS operating profit was EUR 2,009 (1,568) million.
Segment share of operational EBIT, IAC, fair valuations and non-operational items and
operating profit/loss

| Year Ended 31 December
| Operational EBIT | IAC, Fair Valuations and Non-Operational items | Operating Profit/Loss
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Packaging Materials | 596 | 556 | -1 | -4 | 595 | 552
Packaging Solutions | -2 | 26 | -100 | -4 | -101 | 23
Biomaterials | 687 | 495 | -19 | 11 | 668 | 506
Wood Products | 309 | 364 | -56 | -1 | 253 | 363
Forest | 204 | 267 | 319 | 355 | 523 | 622
Paper | 185 | -124 | -14 | -298 | 172 | -423
Other | -47 | -48 | -12 | -19 | -59 | -67
Total | 1,891 | 1,528 | 118 | 40 | 2,009 | 1,568
Net financial items |  |  | -151 | -149
Profit before Tax |  |  | 1,858 | 1,419
Income tax expense |  |  | -322 | -151
Net Profit |  |  | 1,536 | 1,268
Operational EBIT comprises the operating profit excluding items affecting comparability (IAC) and fair valuations from the segments and Stora Enso’s share of the operating profit of equity accounted investments (EAI), also excluding items affecting comparability and fair valuations. IAC =Items affecting comparability are exceptional transactions that are not related to recurring business operations. The most common IAC are capital gains and losses, impairments or impairment reversals, disposal gains and losses relating to Group companies, provisions for planned restructurings, environmental provisions, changes in depreciation due to restructuring and penalties. Items affecting comparability are normally disclosed individually if they exceed one cent per share. Fair valuations and non-operational items include CO 2 emission rights, non-operational fair valuation changes of biological assets, adjustments for differences between fair value and acquisition cost of forest assets upon disposal and the Group’s share of income tax and net financial items of EAI. Non-operational fair value changes of biological assets reflect changes made to valuation assumptions and parameters. Operational fair value changes of biological assets contain all other fair value changes, mainly due to inflation and differences in actual harvesting levels compared to the harvesting plan. The adjustments for differences between fair value and acquisition cost of forest assets upon disposal are a result of the fact that the cumulative non-operational fair valuation changes of disposed forest assets were included in previous periods in IFRS operating profit (biological assets) and other comprehensive income (forest land) and are included in operational EBIT only at the disposal date.

Unaudited 4
Items affecting comparability, fair valuations and non-operational items

| Year Ended 31 December
EUR million | 2022 | 2021
Impairments and impairment reversals | -124 | -141
Restructuring costs excluding impairments | -3 | -227
Acquisitions and disposals | -104 | 11
Other | -15 | 4
Items affecting comparability | -245 | -354
Fair valuations and non-operational items | 363 | 394
Total | 118 | 40

Segment share of operative assets, operative liabilities and operating capital

| Year Ended 31 December
| Operative Assets | Operative Liabilities | Operating Capital
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Packaging Materials | 4,441 | 4,120 | 1,097 | 914 | 3,344 | 3,206
Packaging Solutions | 381 | 422 | 146 | 176 | 235 | 245
Biomaterials | 3,095 | 2,755 | 299 | 236 | 2,796 | 2,520
Wood Products | 998 | 955 | 280 | 277 | 718 | 678
Forest | 7,481 | 7,131 | 518 | 435 | 6,963 | 6,696
Paper | 887 | 884 | 554 | 761 | 333 | 123
Other and eliminations | 1,432 | 970 | 16 | 131 | 1,416 | 839
Total | 18,715 | 17,237 | 2,909 | 2,930 | 15,806 | 14,307

Key figures

| 2022 | 2021 | 2020
Sales, EUR million | 11,680 | 10,164 | 8,553
Operational EBIT, EUR million | 1,891 | 1,528 | 650
Operational EBIT margin | 16.2% | 15.0% | 7.6%
Operating profit (IFRS), EUR million | 2,009 | 1,568 | 922
Operating profit margin (IFRS) | 17.2% | 15.4% | 10.8%
Return on equity (ROE) | 13.3% | 13.0% | 7.6%
Operational ROCE | 13.8% | 12.4% | 5.8%
Operational ROCE excl. Forest division | 20.9% | 17.8% | 7.0%
Net debt/equity ratio | 0.15 | 0.22 | 0.33
EPS (basic), EUR | 1.97 | 1.61 | 0.79
EPS excluding FV, EUR | 1.55 | 1.19 | 0.45
Dividend and distribution per share 1, EUR | 0.60 | 0.55 | 0.30
Payout ratio, excluding FV | 38.6% | 46.3% | 66.7%
Payout ratio (IFRS) | 30.5% | 34.3% | 38.0%
Dividend and distribution yield, (R share) | 4.6% | 3.4% | 1.9%
Price/earnings (R share), excluding FV | 8.46 | 13.60 | 34.78
Equity per share, EUR | 15.89 | 13.55 | 11.17
Market capitalisation 31 Dec, EUR million | 10,503 | 12,809 | 12,383
Closing price 31 Dec, A/R share, EUR | 13.90/13.15 | 16.60/16.14 | 15.90/15.65
Average price, A/R share, EUR | 16.58/16.12 | 16.68/15.70 | 12.06/11.52
Number of shares 31 Dec (thousands) | 788,620 | 788,620 | 788,620
Trading volume A shares (thousands) | 1,174 | 1,750 | 4,662
% of total number of A shares | 0.7% | 1.0% | 2.6%
Trading volume R shares (thousands) | 455,952 | 422,493 | 605,233
% of total number of R shares | 74.5% | 69.0% | 98.8%
Average number of shares, basic (thousands) | 788,620 | 788,620 | 788,620
Average number of shares, diluted (thousands) | 789,391 | 789,126 | 789,182
1 See the Board of Directors' proposal for dividend distribution.

Sales and operational EBIT
Operational ROCE excl. Forest
Net debt to operational E BIT DA
Unaudited 5
Net financial expenses at EUR 151 (149) million were EUR 2 million higher than a year ago. Net
interest expenses, at EUR 105 million, decreased by EUR 20 million, mainly as a result of higher
interest income on interest-bearing receivables and deposits. Other net financial expenses, at
EUR 44 million, were EUR 22 million higher, mainly due to write-down of Russia related loan
receivables and loss allowance. The net foreign exchange impact in respect of cash equivalents,
interest-bearing assets and liabilities and related foreign-currency hedges amounted to a loss of
EUR 1 (loss of EUR 2) million, mainly due to a revaluation of foreign currency net debt in
subsidiaries and joint operations located in China, Brazil, Poland and Russia.
The net tax charge totalled EUR 322 (151) million, equivalent to an effective tax rate of 17.3%
(10.7%), as described in more detail in the Note 9 (Income taxes).
The loss attributable to non-controlling interests was EUR 13 (gain EUR 3) million, leaving a
profit of EUR 1,550 (1,266) million attributable to Company shareholders.
Earnings per share excluding fair valuations were EUR 1.55 (1.19). Operational return on
capital employed was 13.8% (12.4%).
The Group capital employed was EUR 14,356 million on 31 December 2022, an increase of
EUR 1,380 million, mainly due to the increase of the fair valuation of forest assets in Sweden
and shares in Pohjolan Voima.
Breakdown of Capital Employed change

EUR million | Capital Employed
31 December 2021 | 12,976
Capital expenditure excluding investments in biological assets less depreciation | 168
Investments in biological assets less depletion of capitalised silviculture costs | 7
Impairments and reversal of impairments | -107
Fair valuation of forest assets | 529
Unlisted securities (mainly PVO) | 533
Equity accounted investments | 254
Net liabilities in defined benefit plans | 152
Operative working capital and other interest-free items, net | 399
Emission rights | 13
Net tax liabilities | -236
Translation difference | -314
Other changes | -18
31 December 2022 | 14,356

Financing
Cash flow from operations was EUR 1,873 (1,752) million and cash flow after investing activities
was EUR 1,162 (1,101) million. Working capital increased by EUR 461 (increased 25) million,
inventories increased by EUR 454 million and trade receivables by EUR 184 million. Trade
payables increased by EUR 267 million and thus had a positive impact on working capital.
Payments related to the previously recognised provisions were EUR 126 million.
Operative cash flow

EUR million | 2022 | 2021
Operational EBITDA | 2,529 | 2,184
IAC on operational EBITDA | -133 | -213
Other adjustments | -62 | -194
Change in working capital | -461 | -25
Cash Flow from Operations | 1,873 | 1,752
Cash spent on fixed and biological assets | -705 | -645
Acquisitions of equity accounted investments | -7 | -6
Cash Flow after Investing Activities | 1,162 | 1,101

At the end of the year, Group net interest-bearing liabilities were EUR 1,853 (2,309) million. The
decrease in net interest-bearing liabilities was mainly driven by a strong cash flow from
operations after investments and dividend payments. Cash and cash equivalents net of bank
overdrafts increased to EUR 1,917 (1,480) million. The net debt/equity ratio at 31 December
2022 decreased to 0.15 (0.22). The ratio of net debt to the last 12 months' operational EBITDA
decreased to 0.7 (1.1) due to lower net debt and higher operational EBITDA. The average
interest rate on borrowings for the full year 2022 increased to 3.3% (3.0%) with a run-rate of
3.3% as per the end of the fourth quarter.
During 2022, altogether EUR 550 million of bilateral bank loans were arranged. Maturities of
these loans vary from 18 months to 3 years with extension options. Proceeds from these loans
are used for general corporate purposes and EUR 200 million of these loans were undrawn at
reporting date. In May 2022, Stora Enso signed a new EUR 200 million committed credit facility
with a maturity of one year and one six month extension option which was exercised in October
2022.
In December 2021, Stora Enso signed a new EUR 700 million Revolving Credit Facility (RCF)
with 12 commercial banks. The maturity of the facility is five years with two one-year extensions.
The pricing is partly linked to meeting emission targets on Scope 1&2 and Scope 3. In October
2022, the first extension option of this facility was used together with all 12 banks and therefore
maturity is now in 2027. Simultaneously, the existing EUR 600 million RCF with original maturity
in 2023 was cancelled. Additionally, Stora Enso has access to statutory pension premium loans
in Finland up to EUR 1,050 (1,000) million.
The forest land fair valuation increased the Group’s other comprehensive income in equity by
EUR 264 (195) million. The fair valuation of cash flow hedges and equity investments fair valued
through other comprehensive income increased equity by EUR 563 (decreased by EUR 474)
million. This is due to a significantly higher fair valuation of the Group’s shareholding in Pohjolan
Voima Oy (PVO), owing to higher forward electricity prices partly and also by net fair valuation
gains from outstanding cash flow hedge derivatives recorded in other comprehensive income.
At the end of the year, the ratings for Stora Enso’s rated bonds were as follows:

Rating agency | Long/short-term rating | Valid from
Fitch Ratings | BBB- (stable) | 8 August 2018
Moody’s | Baa3 (stable) / P-3 | 1 November 2018

Unaudited 6
Financial results – Segments
Packaging Materials division
The Packaging Materials division is a global leader and expert in circular packaging providing premium
packaging materials based on virgin and recycled fiber. Addressing the needs of today’s eco-conscious
consumers, Stora Enso helps customers replace fossil-based materials with low-carbon, renewable and
recyclable alternatives for their food, beverage and transport packaging. A wide selection of base boards and
barrier coatings enables design optimisation for various demanding packaging end-uses.

EUR million | 2022 | 2021
Sales | 4,690 | 3,898
Operational EBITDA | 900 | 846
Operational EBITDA margin | 19.2% | 21.7%
Operational EBIT | 596 | 556
Operational EBIT margin | 12.7% | 14.3%
Operational ROOC | 18.2% | 18.0%
Cash flow from operations | 756 | 807
Cash flow after investing activities | 440 | 459
Board deliveries, 1,000 tonnes | 4,599 | 4,616
Board production, 1,000 tonnes | 4,682 | 4,685

Packaging Materials division sales were at an all-time high level of EUR 4,690 (3,898) million, an
increase of 20%, driven by higher sales prices in all business segments. Consumer board
market remained strong throughout the year, while the containerboard market turned soft during
the second half of the year, impacting the volume growth year-on-year.
An all-time high operational EBIT at EUR 596 (556) million increased by EUR 40 million
despite of heavy cost increases on all variable cost components. Record high result was driven
by extraordinarily strong Containerboard performance during first half year, partly offsetting the
variable cost escalation.
P ackaging Solutions division
The Packaging Solutions division develops and sells premium fiber-based packaging products and services.
Stora Enso’s high-end eco-friendly packaging products are used by leading brands across multiple market
sectors, including the retail, e-commerce and industrial sectors. The portfolio includes converting corrugated
board and carton board, and other new materials such as formed fiber and wood foams into standard and
bespoke packaging solutions. The division also provides design and sustainability services for our customers,
as we support a shift towards circular solutions.

EUR million | 2022 | 2021
Sales | 737 | 723
Operational EBITDA | 27 | 56
Operational EBITDA margin | 3.6% | 7.8%
Operational EBIT | -2 | 26
Operational EBIT margin | -0.2% | 3.6%
Operational ROOC | -0.7% | 10.8%
Cash flow from operations | -5 | 56
Cash flow after investing activities | -40 | 26
Corrugated packaging European deliveries, million m 2 | 772 | 1,046
Corrugated packaging European production, million m 2 | 771 | 1,049

Packaging Solutions division sales were at an all-time high of EUR 737 (723) million, up 2%,
driven by higher sales prices following the higher cost levels as well as higher sales for
innovation and service led businesses. The revenue from innovation and service led businesses
increased by almost 50%. Examples of these businesses are formed fiber, circular solutions,
reusable solutions and packaging automation.
Operational EBIT was EUR -2 (26) million, impacted mainly by the divestment of the Russian
units and investments in innovation and service led businesses. Operational EBIT for traditional
businesses, excluding Russia, increased.
Sales and operational EBIT
Packaging Materials
Operational ROOC
Packaging Materials
Sales and operational EBIT
Packaging Solutions
Operational ROOC
Packaging Solutions
Unaudited 7
Biomaterials division
The Biomaterials division meets the growing demand for bio-based solutions which replace fossil-based and
non-renewable materials. Stora Enso achieves this by using all fractions of biomass, like lignin, to develop
new solutions including novel applications such as bio-based anode material for batteries and bio-based
binders. Our pulp offering encompasses a wide variety of grades to meet the demands of packaging, paper,
tissue, specialities, and hygiene product producers. We also serve the biochemicals market with tall oil and
turpentine from biomass for further refining. Pulp continues to be our foundation while long-term growth is
driven by new products and innovations.

EUR million | 2022 | 2021
Sales | 2,180 | 1,728
Operational EBITDA | 822 | 618
Operational EBITDA margin | 37.7% | 35.7%
Operational EBIT | 687 | 495
Operational EBIT margin | 31.5% | 28.7%
Operational ROOC | 25.8% | 20.8%
Cash flow from operations | 682 | 490
Cash flow after investing activities | 536 | 391
Pulp deliveries, 1,000 tonnes | 2,554 | 2,576

Biomaterials division sales were at an all time high at EUR 2,180 (1,728) million, up 26% due to
significantly higher pulp sales prices in all grades and favourable currency exchange rates. The
market was strong, supported by a good operational efficiency.
Operational EBIT, at EUR 687 (495) million increased by EUR 192 million, mainly due to
significantly higher sales prices in all grades, supported by good delivery volumes. Operational
EBIT was negatively impacted by higher costs. Foreign exchange rates had a positive impact on
operational EBIT. Side streams contributed more than in previous year.
Wood Products division
The Wood Products division is the largest sawn wood producer in Europe and a leading provider of
sustainable wood-based solutions for the global construction industry. The growing Building Solutions
business offers building concepts and a full range of products to support low-carbon construction. Stora Enso
develops services and digital tools to simplify the design and construction of buildings with wood. Additionally,
we offer applications for windows and doors, and pellets for sustainable heating solutions.

EUR million | 2022 | 2021
Sales | 2,195 | 1,872
Operational EBITDA | 356 | 410
Operational EBITDA margin | 16.2% | 21.9%
Operational EBIT | 309 | 364
Operational EBIT margin | 14.1% | 19.5%
Operational ROOC | 44.2% | 59.4%
Cash flow from operations | 346 | 313
Cash flow after investing activities | 264 | 252
Wood products deliveries, 1,000 m 3 | 4,235 | 4,508

Wood Products division sales were at an all-time-high level of EUR 2,195 (1,872) million, up
17% due to favourable market, record high sales prices, and improved productivity. After a
period of strong sawn wood market, there was a rapid decline in demand after the summer. The
building solutions business continued to benefit from the favourable trend of building with wood.
Operational EBIT was the second highest result, after the all-time high in 2021, at EUR 309
(364) million. It de creased by EUR 55 million, or 15%. The positive impact of sales prices was
offset by higher costs for logs, logistics, energy, and increased fixed costs.
Sales and operational EBIT
Biomaterials
Operational ROOC
Biomaterials
Sales and operational EBIT
Wood Products
Operational ROOC
Wood Products
Unaudited 8
Forest division
The Forest division creates customer value through innovative solutions, competitive wood supply and
sustainable forest management. Forests are the foundation for Stora Enso’s renewable offerings. The division
manages Stora Enso’s forest assets in Sweden and a 41% share of Tornator, whose forest assets are mainly
located in Finland. It is also responsible for wood sourcing for Stora Enso’s Nordic and Baltic operations and
B2B customers. Stora Enso is one of the biggest private forest owners in the world.

EUR million | 2022 | 2021
Sales | 2,519 | 2,311
Operational EBITDA | 256 | 318
Operational EBITDA margin | 10.2% | 13.7%
Operational EBIT | 204 | 267
Operational EBIT margin | 8.1% | 11.5%
Operational ROCE | 3.7% | 5.1%
Cash flow from operations | 146 | 158
Cash flow after investing activities | 91 | 112
Wood deliveries, 1,000 m 3 | 38,217 | 39,652
Operational fair value change of biological assets | 87 | 82

Forest division sales were EUR 2,519 (2,311) million, up 9% due to higher sales prices.
Operational EBIT at EUR 204 (267) million de creased by 24%. Excluding the large forest
area sale in Hylte in Sweden in 2021, operational EBIT improved by 6% from last year.
Pa per division
At the end of 2022, Stora Enso had an established customer base and its product portfolio had offerings for
print and office use. Customers benefit from Stora Enso’s selection of paper grades made from recycled and
virgin fiber, our technical and operational expertise and sustainability know-how, and our sales and customer
service centre network.

EUR million | 2022 | 2021
Sales | 1,772 | 1,703
Operational EBITDA | 242 | -48
Operational EBITDA margin | 13.7% | -2.8%
Operational EBIT | 185 | -124
Operational EBIT margin | 10.5% | -7.3%
Operational ROOC | 81.3% | -40.3%
Cash flow from operations | 77 | -25
Cash flow after investing activities | 16 | -77
Cash flow after investing activities to sales | 0.9% | -4.5%
Paper deliveries, 1,000 tonnes | 1,924 | 2,872
Paper production, 1,000 tonnes | 1,926 | 2,776

Paper division sales increased by 4% to EUR 1,772 (1,703) million, despite lower deliveries due
to the closures of the Veitsiluoto and Kvarnsveden sites in Q3/2021. Paper prices increased
significantly throughout the year, resulting in successful turnaround of the paper business
supported by good supply-demand balance. Sales from retained business, after the closures of
Veitsiluoto and Kvarnsveden, increased by 50%.
Operational EBIT at EUR 185 (-124) million increased by EUR 310 million, due to the
significantly higher sales prices more than offsetting the increase in variable costs, especially
energy.
Cash flow after investing activities was EUR 16 (-77) million driven by improved profitability,
however impacted by the higher restructuring provision payouts during the yea r. Cash flow from
the retained business was EUR 94 (-8) million.
Sales and operational EBIT
Forest
Operational ROCE
Forest
Sales and operational EBITDA
Paper
Cash flow after investing
activities to sales ratio
Paper
Unaudited 9
Other
The segment Other includes Stora Enso’s shareholding in the energy company Pohjolan Voima
(PVO), and the Group’s shared services and administration.

EUR million | 2022 | 2021
Sales | 1,097 | 1,092
Operational EBITDA | -33 | -9
Operational EBITDA margin | -3.0% | -0.8%
Operational EBIT | -47 | -48
Operational EBIT margin | -4.3% | -4.4%
Cash flow from operations | -130 | -48
Cash flow after investing activities | -146 | -62

Sales for Segment Other at EUR 1,097 (1,092) million and operational EBIT at negative EUR 47
(48) million remained flat compared to previous year.
Investments and capital expenditure
Additions to fixed and biological assets including internal costs capitalised in 2022 totalled EUR
778 (666) million. The total amount includes additions in biological assets of EUR 77 (58) million.
In January, an investment of EUR 40 million was announced to enhance operational and
carbon footprint performance for fluff pulp production at the Skutskär site in Sweden.
In February, Stora Enso announced an investment of EUR 9 million in an automated CLT
(cross-laminated timber) coating line at the Ybbs sawmill in Austria. The solution will shorten
construction times and improve wood protection.
In April, Stora Enso decided to invest EUR 10 million to reduce annual operational CO 2
emissions by 70,000 tonnes at its Enocell site, Finland, replacing fossil-based fuel oil with
renewable pitch oil made from trees. This complements the main energy source, sawdust
powder, utilising 100% bio energy.
Following the feasibility study announced in February 2022 Stora Enso announced in
October, that it will invest approximately EUR 1 billion to convert the remaining idle paper
machine at the Oulu site in Finland into a high-volume consumer board line. The investment
supports the Group’s growth strategy in renewable packaging by providing new volume for
growing packaging segments. The targeted end-use segments are food and beverage
packaging, especially frozen and chilled, and dry and fast food, mainly in Europe and North
America. Production on the converted machine is estimated to start in early 2025.
Stora Enso’s new production site for cross-laminated timber (CLT) in Ždírec, the Czech
Republic, was inaugurated in October. Following the EUR 79 million investment, the new CLT
site is one of the most modern in the world, supporting Stora Enso’s strategy of growth within
wooden building solutions. The estimated annual production capacity will be approximately
120,000 m³ after ramp-up.
The investment in centralising and modernising the wood handling capacity at the Imatra site
in Finland was completed in November. The investment of EUR 80 million, started in the first
quarter of 2021, reduces water usage at the site by 85% and enhances Stora Enso’s production
capabilities for premium packaging board. The project included installation of a new, third
debarking line, improvements to chip handling systems, and modifications to the existing wood
yard infrastructure.
In December, Stora Enso announced a EUR 38 million investment in unbleached kraft pulp
(UKP) production at its Enocell site in Finland and a EUR 42 million investment in fluff pulp
production improvement at its Skutskär site in Sweden to strengthen its focus on specialised
pulp grades. These investments will support the growing consumer demand for non-bleached
renewable packaging materials and hygiene products respectively.
Stora Enso is conducting a feasibility study regarding the conversion of the one of the two
paper line at its Langerbrugge site in Belgium into a high-volume recycled containerboard line.
The feasibility study is expected to be finalised in the first half of 2023. Depending on an
investment decision, the converted line is expected to be in production during 2025. The annual
capacity would be 700,000 tonnes of testliner and recycled fluting grades and would generate
annual sales of approximately EUR 350 million when run at full capacity. The total investment for
the conversion is estimated to be approximately EUR 400 million.
The Group is also evaluating its first industrial production line of lignin at the Sunila site in
Finland through a feasibility study.
The other main projects ongoing at the end of 2022 were an investment in increasing
capacity at the Skoghall board production site in Sweden, and Skutskär bleach plant upgrade in
Sweden.
Changes in the Group structure
During 2022, Stora Enso divested its three corrugated packaging plants in Lukhovitsy, Arzamas
and Balabanovo in Russia to local management. Stora Enso also divested its two sawmills in
Nebolchi and Impilahti in Russia to local management. The divestment included Stora Enso’s
Russian forest operations which supplied wood to the sawmills. Minor formalities remain to
complete the transaction for certain Russian legal entities.
In March, Stora Enso announced that it would divest four of its five paper mills. In September,
Stora Enso signed agreements to divest the Maxau paper production site in Germany to
Schwarz Produktion, part of Schwarz Group, one of the top retailers in the world, and the
Nymölla site in Sweden to Sylvamo, a US-based global producer of uncoated paper. The
divestment of the Nymölla site to Sylvamo was concluded in early January, and the divestment
of the Maxau site is expected to be finalised during the first half of 2023. The divestment of the
Hylte site in Sweden to Sweden Timber was announced in January 2023. The Group also
announced that the Anjala paper will be retained in the Group.
In September, Stora Enso announced the acquisition of De Jong Packaging Group, based in
the Netherlands, for an enterprise value of EUR 1,020 million. The acquisition advances Stora
Enso’s strategic direction, accelerates revenue growth and builds market share in renewable
packaging in Europe. De Jong Packaging Group is one of the largest corrugated packaging
producers in the Benelux countries. Its product portfolio and geographic presence complement
and enhance Stora Enso’s offering, especially in fresh produce, e-commerce and industrial
packaging. The transaction was completed in January 2023.
I nnovation, research and development
Stora Enso’s total spend on innovation, research and development in 2022 was EUR 112 (133)
million, equivalent to 1.0% (1.3%) of total sales. Research and development work is a basic
element for staying relevant and competitive towards customers. The company employed
approximately 400 people in research and development. The responsibility of product
innovations and development of services is at the business divisions while long-term science
and research priorities are driven by Group Innovation and R&D.
Stora Enso's innovation and growth focus is on the development of sustainable packaging
applications to replace plastic-based materials, bio-based barriers solutions for packaging,
innovative biomaterials or high-end applications, and the development of sustainable wooden-
Unaudited 10
based materials and components in Building Solutions which store carbon and improve
buildings’ energy efficiency.
Intellectual property (IP) is an important tool to protect and secure Stora Enso's development
of innovative products and processes. During 2022, Stora Enso continued to strengthen its
patent portfolio by applying for patents for 83 new innovations. The focus of the new patent
filings has been within Biomaterials, Packaging Materials and Packaging Solutions. Stora Enso’s
patent portfolio amounts to over 3,800 applications and granted patents.
For more information on Stora Enso's Innovation and R&D, please see the section Our
strategy.
Non-financial information
Requirements of non-financial information reporting according to the Finnish Accounting Act are
reported below. The scope of the reporting includes those non-financial topics that relate to the
Group’s key risks.
Risks and policy principles related to these topics are additionally described in the chapter
Risks and Risk Management, including Stora Enso’s reporting according to Task Force on
Climate-related Financial Disclosures (TCFD) recommendations.
Business model
Stora Enso is one of the leading providers of renewable products in packaging, biomaterials and
wooden construction, and one of the largest private forest owners in the world. Sustainability is
deeply embedded in the Group's strategy and responsible business practices. Stora Enso
contributes to the transformation towards a biobased circular economy in three areas where it
has the biggest impact and opportunities: climate change, biodiversity, and circularity. A
description of Stora Enso's business model is at the beginning of the Report of Board of
Directors.
Stora Enso acknowledges the importance of the United Nations Sustainable Development
Goals (SDGs) as part of a commonly agreed global ambition to end poverty, protect the planet
and improve the lives and prospects of everyone, everywhere. Stora Enso supports all
seventeen SDGs, and goals 12 (Responsible consumption and production), 13 (Climate action),
and 15 (Life on land) have been identified as most relevant where the Group has the largest
impact through its operations and products.
Sustainability governance
Sustainability is a key element of Stora Enso’s corporate governance, promoted by the Board of
Directors, the CEO, and the Group Leadership Team (GLT). The CEO carries the ultimate
responsibility for the successful implementation of the sustainability strategy. Work on
sustainability is led by the Executive Vice President, Sustainability, who reports directly to the
CEO. The Board of Directors’ Sustainability and Ethics Committee oversees the implementation
of Stora Enso’s Sustainability Strategy and Ethics and Compliance Strategy. The Committee met
four times in 2022.
Stora Enso’s Sustainability Policy describes the Group's overall approach to sustainability
and the governance model. At the same time, the Code of Conduct and other policies,
guidelines, and statements on specific sustainability topics all further elaborate the approach,
while also guiding the Group’s employees in their everyday work. These documents are
available at storaenso.com/sustainability.
More information on Stora Enso’s approach to sustainability is included in the sections Our
Strategy and Sustainability reporting.
Environmental matters
Climate change
Key policy: Energy and Carbon Policy
Stora Enso's science-based target is to reduce absolute scope 1 and 2 greenhouse gas (GHG)
emissions from operations by 50% by 2030 from the 2019 baseline year, in line with the 1.5-
degree scenario. Stora Enso is also committed to a target to reduce scope 3 GHG emissions by
50% by 2030 from the 2019 baseline year.
In 2022, Stora Enso’s absolute GHG emissions (scope 1 and 2) were 27% lower than the
baseline level (14%1 lower in 2021). During 2022, the emissions decreased mainly due to less
use of fossil fuels in multiple production sites as well as the ceasing operations at the Veitsiluoto
mill in Finland.
Stora Enso’s estimated GHG emissions elsewhere along the value chain (scope 3) were 27%
lower than the baseline level (4%1 lower in 2021). The emissions decreased year-on-year due to
mill closures and the end of dissolving pulp production.
1 Historical figures recalculated due to divestments or additional data after the previous annual report.
Sustainable forestry and biodiversity
Key policy: Wood and Fiber Sourcing, and Land Management policies
Stora Enso is committed to achieving a net-positive impact on biodiversity in its own forests and
plantations by 2050 through active biodiversity management. During 2022, Stora Enso launched
a Biodiversity Leadership Programme with selected projects to drive the delivery of this target.
The programme covers Stora Enso’s own forests, suppliers’ forests, and global forests, as well
as improving biodiversity beyond the forest sector.
The company uses its own forest in Sweden as a platform for continuously developing new
biodiversity management practices to be adapted to local conditions and implemented in
different geographical areas when feasible. Measures to be developed, tested and used in the
Company's own forests in Sweden include: application of modern digital tools to improve
accuracy of planning and operations; increasing amount of deadwood and broad-leaved trees,
especially birch; continuous cover forestry in suitable areas; and increasing use of controlled
burning in forest regeneration. Stora Enso monitors and measures the state of biodiversity and
the impact of its operations on biodiversity with selected science-based indicators.
Currently, Stora Enso follows its progress in sustainable forestry with a key performance
indicator that measures the proportion of land in wood production and harvesting owned or
leased by Stora Enso covered by forest certification schemes. At the end of 2022, Stora Enso
owned or leased lands covered a total area of 2.01 million hectares (2.01 million hectares in
2021). The majority of Stora Enso’s owned or leased lands are located in Sweden. For more
details, see the Note 12. The Group’s target is to maintain the high level of 96%, and in 2022,
the certification coverage amounted to 99% (99%1 in 2021). Certain purchased areas in Stora
Enso’s joint operations in Brazil and Uruguay were in the certification process but not yet
certified by the end of 2022.
In 2022, the total amount of wood (including roundwood and wood chips) delivered to Stora
Enso's mills was 35.1 million m 3 (solid under bark) (37.6 million m 3 in 2021). The proportion of
third-party certified wood in the Group's total wood supply was 80% (77%).
1 Reporting on total land area and its forest certification coverage aligned with financial reporting on forests assets. Historical figures
recalculated for comparability. For more information, see Note 12
Unaudited 11
Circularity
Key policy: Stora Enso Circular Design Guidelines
Stora Enso is committed to transparent and circular material flows that help to minimise waste
and combat climate change. The target is to achieve 100% recyclable products by 2030. By the
end of 2022, 94% of the Group's products were recyclable.2
2 Based on the technical recyclability of products and their production volumes consolidated as tonnes. Technical recyclability is defined
by international standards and tests when available, such as PTS and CTP, and in absence of these by Stora Enso’s own tests that
prove recyclability. The reporting scope includes Stora Enso’s packaging, pulp, paper and solid wood products as well as biochemical by-
products.
Water
Key policy: Stora Enso Environmental Guidelines
The objective of the Group’s key performance indicators on total water withdrawal and process
water discharges is to drive a downward trend from the 2016 baseline of 59 m 3 and 27 m 3 per
saleable tonne of product, respectively. In 2022, total water withdrawal was 61 m 3 per saleable
tonne (60 m 3 in 2021) and process water discharges amounted to 31 m 3 per saleable tonne
(31 m 3 in 2021). Water performance normalised by tonne was partly affected by lower production
levels compared to the baseline year. From 2023, the target for process water discharge is to
reduce specific process water discharges per saleable tonne (m 3/tonne) by 17% by 2030 from its
new baseline year, 2019. The amount of water required at Stora Enso’s board, pulp and paper
mills is not directly related to production volumes, and wastewater treatment, in particular,
requires a regular flow of water to function properly.
Social and employee matters
Employees
Key policies: Minimum Human Resources Requirements for labour conditions
On 31 December 2022, there were 20,879 (22,094) employees in the Group. The average
number of employees in 2022 was 21,790, which is 1,281 less than the average number in
2021. The figures include 50% of the employees at Veracel in Brazil and Montes del Plata in
Uruguay. Read more in the chapter Employees in the Sustainability reporting section.
Personnel expenses totalled EUR 1,315 (1,351) million or 11.3% of sales. Wages and
salaries were EUR 996 (1,017) million, pension costs EUR 152 (165) million and other employer
costs amounted to EUR 160 (162) million.
At the end of 2022, the Group's top four countries in respect to the number of employees
were Finland, Sweden, China, and Poland. 25% (24%) of all employees were women. As of
2022, Stora Enso's target is to increase the share of female managers among all managers to
25% by the end of 2024. By the end of 2022, 23% of managers were female.
Personnel turnover in 2022 was 13.9%(13.2%). Illness-related absenteeism amounted to
4.1% (3.8%) of total theoretical working hours.
The Group's wages in relation to local minimum wages and approach to living wages are
described in chapter Employees in the Sustainability reporting section. Remuneration to the
Board of Directors and key management is described in Note 7 of the consolidated financial
statements.
Safety
Key policy: Health and Safety Policy
In 2022, the Total Recordable Incident (TRI) rate decreased to 5.9 (6.2). The milestone of 5.3 for
2022 was not achieved. Even though Stora Enso’s safety performance has remained stable over
the past years, it is does not reflect the Group’s dedication of everybody home safe, every day.
Sustainable sourcing
Key policy: Supplier Code of Conduct (SCoC)
Stora Enso’s key performance indicator for responsible sourcing measures the proportion of
Group's total supplier spend covered by the Supplier Code of Conduct (SCoC), including all
categories and regions. By the end of 2022, 96% of Stora Enso’s total spend on materials,
goods, and services was duly covered (96% at the end of 2021), which exceeds the target to
maintain at least the level of 95%.
Respect for human rights
Key policy: Human Rights Policy and Guidelines
Stora Enso’s commitment to respect human rights covers all our operations, including
employees, contractors, suppliers, and neighbouring communities. In addition to the Group's
commitment to the UN Guiding Principles on Business and Human Rights, Stora Enso’s annual
Slavery and Human Trafficking Statement is available at storaenso.com/sustainability.
While Stora Enso considers all human rights to be important and respects them, the human
rights identified as having the highest priority remain the primary focus. This includes the
following topics:
•Health and safety
•Fair labour (fair employment conditions, freedom from forced labour, freedom of association,
non-discrimination and non-harassment)
•Land and natural resource rights acquisition and management
•Grievance mechanisms
•Children’s rights (relevant to the forest sector)
In preparation for the upcoming EU Corporate Sustainability Due Diligence (CSDD) directive,
Stora Enso, together with an external business and human rights consultancy, carried out three
pilot projects in 2022 focused on improving our internal controls for two high risk supply chains,
as well as the due diligence processes in our own operations. Read more in chapter Human
Rights in the Sustainability reporting section.
During 2022, Stora Enso continued to address land and natural resource rights in Guangxi,
China and Bahia, Brazil.
Guangxi, China
Stora Enso leases 73,133 hectares of land in Guangxi province China, of which 53,437 hectares
is leased from state-owned forest farms. The remaining 19,696 hectares, or 27% of the total
area, is social land leased from village collectives, individual households, and local forest farms.
Parts of the land leased by Stora Enso have been occupied for up to ten years for the
purpose of growing crops and trees on a small scale. In some cases, the occupiers are claiming
rights to the land based on historical land ownership documents that have been superseded by
state ownership in successive land reform processes. Recovery of occupied land continued in
2022, with 6,124 hectares of land still under occupation at the end of the year. In December
2022, Stora Enso initiated a divestment process for the Beihai site and the forest operations.
Unaudited 12
Bahia, Brazil
In Bahia, Brazil, work continued on a Sustainable Settlement Initiative launched in 2012 to
provide farming land and educational support for local families in the landless people’s social
movements. In 2018, Veracel signed a new agreement with the social landless movements to
complement the earlier agreed Sustainable Settlement Initiative.
At the end of 2022, 182 hectares or 0.2% of productive land owned by Veracel remained
occupied by movements not involved in the agreements.
At the end of 2022, the total land area owned by Veracel was 210,000 hectares, of which
82,000 hectares are used for growing eucalyptus for pulp production. Approximately half of
Veracel's lands are dedicated to protecting local biodiversity by restoring and conserving the
natural Atlantic rainforest.
Community
Key policies: Human Rights Policy and Guidelines, Community Investment Guidelines
During 2022, Stora Enso initiated a number of large cash donations towards humanitarian
emergency relief. Two donations were directed towards the Ukraine crisis and one towards the
emergency relief following the severe flooding in Pakistan. The donations were channelled
through UNHCR.
The total monetary value of the community contribution towards Ukraine across the Group
was EUR 0.25 million. In 2022, Stora Enso’s total voluntary community investment was EUR 2.0
million.
Anti-corruption and bribery matters
Key policies: Business Practice Policy, the Stora Enso Code (Code of Conduct)
A total of 153 (117 in 2021) potential non-compliance cases were reported in 2022. In recent
years there has been a steady increase in the number of reported cases, most likely due to more
focus on ethical conduct, compliance and whistleblowing, both internally and externally. A total of
140 (98) investigations of potential non-compliance were completed, which also included open
cases from previous years. Proven cases leading to disciplinary action, legal action and/or
process improvements were identified in 44 (26) of the investigations. Based on the Group’s
categorisation, 12 (9) of the proven cases were related to corruption and/or fraud, resulting in
employee dismissal or a disciplinary process. While Stora Enso continues to enforce zero
tolerance of corruption, none of the proven cases had a material impact on the Company.
Furthermore, 13 (11) of the proven cases were related to discrimination, harassment and/or
bullying. Remediation plans have been or are being implemented together with relevant
management representatives.
EU Taxonomy
Background
To meet the EU’s climate and energy targets for 2030 and reach the objectives of the European
Green Deal, a classification system for sustainable economic activities called EU Taxonomy was
published and entered into force in 2020. In the Annual Reports for 2021, published in 2022,
large companies were obligated to report the share of Taxonomy-eligibility in their operations.
Taxonomy-eligibility describes if an economic activity is included in the scope of activities
recognised in the Taxonomy Regulation. In the Annual Reports for 2022, published in 2023,
companies are obligated to report also the share of Taxonomy-alignment in their operations.
Taxonomy-alignment describes if an economic activity is sustainable based on defined science-
based technical screening criteria specified for the activity. The criteria for ‘substantial
contribution’ determine that the economic activity either has a substantial positive environmental
impact or substantially reduces negative impacts on the environment. The criteria for ‘do no
significant harm’ determine that the economic activity does not impede on the other
environmental objectives from being reached, i.e. has no significant negative impact on them.
Taxonomy-aligned activity needs to be also carried out in compliance with the minimum
safeguards, thus sustainable activity is to respect basic human rights and follow good business
conduct rules.
During the first two reporting years of the EU Taxonomy, the focus is on activities contributing
to climate objectives, climate change mitigation and adaptation, according to the EU Climate
Delegated Act. The Taxonomy Regulation is a developing regulation and not yet covering all
sustainable activities in the market. The forest industry is not at the core of the current legislation
and therefore has only few relevant economic activities to report on. From Stora Enso’s main
products, only wood-based solutions for construction industry are included in the EU Taxonomy
through their contribution to buildings' energy efficiency. Other main products, production of pulp,
consumer board, containerboard, corrugated packaging and paper, are out of the scope of the
EU Taxonomy and therefore the reported Taxonomy-eligible KPIs are low. EU Taxonomy is
anticipated to expand to four other environmental objectives during 2023 with the next delegated
act, but the amendments are not expected to bring major impact to Stora Enso's Taxonomy-
eligibility. Stora Enso supports the goals set by EU Taxonomy and welcomes the further
development of the regulation.
EU Taxonomy accounting principles
The KPI's reported in the EU Taxonomy are presented in separate tables for turnover, CapEx
and OpEx as defined in the regulation. The total turnover is Stora Enso Group’s total sales and
rental income in 2022, which respectively include the IFRS15 and the IFRS16 income according
to the EU Taxonomy turnover definition. The external sales connected to the economic activities
are correspondingly reported under Taxonomy-eligible turnover, either under Taxonomy-aligned
or not Taxonomy-aligned. The total CapEx is the Group's total capital expenditure in 2022, as
presented in the line of additions, excluding goodwill additions, in the Note 11 (Intangible assets,
property, plant and equipment and right of use assets), and the Note 12 (Forest assets). The
Taxonomy-eligible CapEx, either Taxonomy-aligned or not Taxonomy-aligned, are the
investments related to the assets or processes associated with the respective economic
activities. The total OpEx covers the maintenance expenses, short-term lease costs, non-
capitalised research and development costs and silviculture costs on Stora Enso Group level.
The Taxonomy-eligible OpEx include the corresponding direct non-capitalised costs associated
to the economic activities, reported either under Taxonomy-aligned or not Taxonomy-aligned.
Different to last year’s practice, the reported CapEx and OpEx are reported in full amount for
activities 1.3 Forest management and 4.20 Cogeneration of heat/cool and power from bioenergy
instead in relation to external turnover as in 2021.
Stora Enso avoids double counting by having a clear cost structure in reporting which
ensures that the profit centres and cost elements are separate for each activity.
Taxonomy eligible and aligned activities
Stora Enso has identified six eligible activities to report in the EU Taxonomy. Stora Enso has
carried out the assessments for Taxonomy-eligibility and Taxonomy-alignment based on the best
interpretation of the Taxonomy Regulation and the Climate Delegated Act and the currently
available guidelines from the European Commission. During 2022 Stora Enso formed a working
group of experts to assess if the eligible activities recognised in the EU Taxonomy are fulfilling
the criteria for Taxonomy alignment. For each economic activity, Stora Enso conducted
Unaudited 13
assessment for substantial contribution and ‘do no significant harm’ criteria to determine the
alignment. The alignment was determined for the climate change mitigation objective. Minimum
safeguards were assessed on the Group level. In the process Stora Enso used support from
external experts to provide a second opinion and the assessments and the data is covered by
external assurance.
1.3 Forest management
Stora Enso is one of the biggest private forest owners in the world and the forest assets share of
Group total assets is significant, 39% (excluding leased land). While Stora Enso owns forests
also via holdings, Taxonomy-eligible forest management includes only Stora Enso's own forest
activities in Sweden where the Company has full control over the activity. Tree plantations in
South America and China are not included in the EU Taxonomy reporting, under forest
management. 100% of Stora Enso’s Swedish forests are certified under certification systems
(PEFC or FSC) which lays the foundation for sustainable forest management. Through
assessment of the technical screening criteria for substantial contribution and ‘do no significant
harm’ defined in the EU Taxonomy for 1.3 Forest management, the activity was concluded
Taxonomy-aligned.
The output of the activity, the grown wood, is used mostly internally in Stora Enso’s own
operations and hence not included in EU Taxonomy reporting. In the EU Taxonomy, the forest
management turnover includes the sale of externally sold roundwood and forest residuals. The
CapEx includes investments that support the forest management activities, such as forest land
acquisitions and investments in roads and bridges. In OpEx the silviculture costs and related
research and development costs are included.
1.4 Conservation forestry
In Brazil, Stora Enso’s 50% owned joint operation Veracel has dedicated approximately half of
its land for protection and restoration of biological biodiversity in natural Atlantic rainforest. The
aim is to restore each year new rainforest areas on degraded grasslands/pasture lands. The
conservation operations are included in Taxonomy-eligible conservation forestry. Conservation
forests are maintained as local habitat and species protection areas and are excluded from the
harvesting activities and plans. Through assessment of the technical screening criteria for
substantial contribution and 'do no significant harm' defined in the EU Taxonomy for 1.4
Conservation forestry, the activity was concluded Taxonomy-aligned.
There is no turnover nor CapEx connected to the conservation forestry activity. OpEx
includes the expenses related to the conservation work.
3.4 Manufacture of batteries
Graphitic carbon in lithium-ion batteries can be replaced with renewable hard carbon made from
lignin, which is a by-product in the production of cellulose fibers. Lignin is produced at Stora
Enso’s pulp production site in Sunila, where the pilot plant for refining of lignin and turning it into
hard carbon material (Lignode ®) for batteries was established. The pilot plant investment and
research and development related to hard carbon innovation are included in Taxonomy-eligibility.
Lignode offers a renewable active anode material for batteries, contributing to energy storage
applications for transportation, stationary and off-grid energy storage, and hence to climate
change mitigation. The alignment assessment is done based on the predicted future industrial
scale operations and production which will be aligned with the technical screening criteria of 3.4
Manufacture of batteries once started.
No turnover is yet connected to this activity. CapEx includes the investment in the pilot plant
in Sunila. OpEx includes the non-capitalised research and development costs of Lignode and
the maintenance material and other direct costs at the pilot plant in Sunila. External turnover for
the activity is expected within the next few years.
3.5 Manufacture of energy efficiency equipment for buildings
Stora Enso produces wood-based solutions for the construction industry. Door, window and
roofing components and external wall systems manufactured from classic sawn, CLT, LVL and
construction beams are reported eligible in the EU Taxonomy. Stora Enso manufactures
construction materials at sawmills in several countries and locations. As Stora Enso is not a
manufacturer of the end products, the compliance with the substantial contribution was
assessed based on the knowledge of the end use and the energy efficiency related regulations
in the primary market areas. Through an assessment of the technical screening criteria for
substantial contribution and 'do-no-significant harm' defined in the EU Taxonomy for 3.5
Manufacture of energy efficiency equipment for buildings, the activity was concluded Taxonomy-
aligned.
The external sales related to the share of production that is estimated to end up for doors,
windows, roofing and external wall systems, is included under the EU Taxonomy turnover. The
same share is used in allocation of the related CapEx and OpEx costs for the activity. CapEx
includes the investments related to the production of the Taxonomy-eligible products under this
activity. The largest single CapEx item is the investment in a new CLT site in Ždírec that was
inaugurated in October 2022. OpEx includes the maintenance salaries, maintenance material,
research and development and other direct costs related to the day-to-day serving of the asset.
4.15 District heating/cooling distribution
Stora Enso has invested in connecting pipeline to provide district heating for Karlsruhe area in
Germany. Industrial surplus heat produced at the Maxau site's combined heat and power plant in
Germany is fed into the pipeline. The new connection is taken into use early 2023. Through
assessment of the technical screening criteria for substantial contribution and do no significant
harm defined in EU Taxonomy for 4.15 District heating/cooling distribution, the activity was
concluded Taxonomy- aligned.
The investment in the district heating pipeline at Maxau is reported in the EU Taxonomy in
2022. The turnover and OpEx are expected to start generating during 2023. Stora Enso has
signed an agreement to divest the Maxau paper production site and all related assets to
Schwarz Produktion. The ownership is assumed to change in the beginning of 2023.
The turnover, CapEx and OpEx from other Stora Enso mills, that produce eligible bioenergy
and are connected to local district heating systems, are reported under activity 4.20
Cogeneration of heat/cool and power from bioenergy.
4.20 Cogeneration of heat/cool and power from bioenergy
At Stora Enso, wood residuals like bark, saw dust powder, harvesting residuals and by-products
from the pulp process like black liquor are used for energy production. Most of the produced
bioenergy is consumed internally, but energy is also sold to external markets. The bioenergy that
uses solely biobased feedstock in normal operations (excluding the usage of start-up fuel), is
considered eligible in the EU Taxonomy reporting. Eligible bioenergy is produced in several
Stora Enso sites. Through assessment of the technical screening criteria for substantial
contribution and 'do no significant harm' defined in the EU Taxonomy for 4.20 Cogeneration of
heat/cool and power from bioenergy, the majority of the activity was concluded Taxonomy-
aligned. The few boilers that did not meet all the thresholds defined in 'do no significant harm'
criteria for pollution, are reported as Taxonomy-eligible but not Taxonomy-aligned.
Unaudited 14
In the EU Taxonomy, the turnover includes the external sales of the excess electricity and
heat which is not consumed internally. CapEx includes the investments in the bioenergy
production at different sites. OpEx includes the maintenance salaries, maintenance material and
other direct costs related to the day-to-day serving of the asset.
Minimum safeguards
The Taxonomy Regulation specifies that in addition to substantial contribution and 'do no-
significant harm' criteria, an economic activity can be considered environmentally sustainable
only if it is carried out in compliance with the minimum safeguards. The minimum safeguards
prevent activities from being labelled sustainable if they for example violate human or labour
rights, engage in corrupt, anti-competitive or non-compliant taxation practices. The compliance
can be assessed from two angles according to the published guidance from Platform on
Sustainable Finance: there are adequate processes and controls in place in the areas of human
rights, corruption, taxation and fair competition and there are no breaches or violations existing.
Stora Enso has assessed the compliance with minimum safeguards by reviewing the
company processes for human rights, corruption, taxation and fair competition and investigated
possible cases of violations by the parent company, its subsidiaries or senior management.
While Stora Enso acknowledges the importance of continuous improvement of the processes in
these areas, the Company considers its processes to be on a robust level and with no violations
to meet the alignment with the minimum safeguards. Read more in the following chapters in the
Sustainability reporting section: Human rights, Business ethics, and Stora Enso's tax footprint.
Proportion of Turnover from products or services associated with Taxonomy-aligned economic activities 2022

EUR million |  |  |  | Substantial contribution criteria | DNSH criteria ('Does Not Significantly Harm') |  |  |  |
Economic Activities | Code(s) | Absolute turnover | Proportion of turnover | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular economy | Pollution | Biodiversity and ecosystems | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular economy | Pollution | Biodiversity and ecosystems | Minimum safeguards | Taxonomy- aligned proportion of turnover, year N | Category (enabling activity) | Category (transitional activity)
|  | EUR | % | % | % | % | % | % | % | y/n | y/n | y/n | y/n | y/n | y/n |  |  | E | T
A TAXONOMY-ELIGIBLE ACTIVITIES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
A.1 Environmentally sustainable activities (Taxonomy-aligned) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Forest management | 1.3 | 111 | 0.9% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100.0% |  |
Manufacture of energy efficiency equipment for buildings | 3.5 | 595 | 5.1% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100.0% | E |
Cogeneration of heat/cool and power from bioenergy | 4.20 | 54 | 0.5% | 100% |  |  |  |  |  | N/A | y | y | N/A | y | y | y | 96.6% |  |
Turnover of environmentally sustainable activities (Taxonomy- aligned) A.1 |  | 760 | 6.5% |  |  |  |  |  |  |  |  |  |  |  |  |  | 99.7% |  |
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cogeneration of heat/cool and power from bioenergy | 4.20 | 2 | 0.0% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Turnover of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) |  | 2 | 0.0% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total (A.1+A.2) |  | 762 | 6.5% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Turnover of Taxonomy-non-eligible activities (B) |  | 10,932 | 93.5% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total (A+B)1 |  | 11,694 | 100% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

1 In the Taxonomy, turnover includes also rental income, therefore the figure differs slightly from the Group total sales.
Unaudited 15
Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities 2022
Capital Expenditure

EUR million |  |  |  | Substantial contribution criteria | DNSH criteria ('Does Not Significantly Harm') |  |  |  |
Economic Activities | Code(s) | Absolute CapEx | Proportion of CapEx | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular economy | Pollution | Biodiversity and ecosystems | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular economy | Pollution | Biodiversity and ecosystems | Minimum safeguards | Taxonomy- aligned proportion of capex, year N | Category (enabling activity) | Category (transitional activity)
|  | EUR | % | % | % | % | % | % | % | y/n | y/n | y/n | y/n | y/n | y/n |  | % | E | T
A TAXONOMY-ELIGIBLE ACTIVITIES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
A.1 Environmentally sustainable activities (Taxonomy-aligned) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Forest management | 1.3 | 13 | 1.6% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100% |  |
Manufacture of batteries | 3.4 | 3 | 0.3% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100% | E |
Manufacture of energy efficiency equipment for buildings | 3.5 | 23 | 3.0% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100% | E |
District heating/cooling distribution | 4.15 | 2 | 0.3% | 100% |  |  |  |  |  | N/A | y | y | N/A | y | y | y | 100% |  |
Cogeneration of heat/cool and power from bioenergy | 4.20 | 7 | 0.8% | 100% |  |  |  |  |  | N/A | y | y | N/A | y | y | y | 70.1% |  |
CapEx of environmentally sustainable activities (Taxonomy-aligned) A.1 |  | 47 | 6.0% |  |  |  |  |  |  |  |  |  |  |  |  |  | 94.3% |  |
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cogeneration of heat/cool and power from bioenergy | 4.20 | 3 | 0.4% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CapEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) |  | 3 | 0.4% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total (A.1+A.2) |  | 50 | 6.4% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CapEx of Taxonomy-non-eligible activities (B) |  | 728 | 93.6% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total (A+B) |  | 778 | 100.0% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

Unaudited 16
Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities 2022

EUR million |  |  |  | Substantial contribution criteria | DNSH criteria ('Does Not Significantly Harm') |  |  |  |
Economic Activities | Code(s) | Absolute OpEx | Proportion of OpEx | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular economy | Pollution | Biodiversity and ecosystems | Climate change mitigation | Climate change adaptation | Water and marine resources | Circular economy | Pollution | Biodiversity and ecosystems | Minimum safeguards | Taxonomy- aligned proportion of OpEx, year N | Category (enabling activity) | Category (transitional activity)
|  | EUR | % | % | % | % | % | % | % | y/n | y/n | y/n | y/n | y/n | y/n |  | % | E | T
A TAXONOMY-ELIGIBLE ACTIVITIES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
A.1 Environmentally sustainable activities (Taxonomy-aligned) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Forest management | 1.3 | 27 | 3.2% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100% |  |
Conservation forestry | 1.4 | 1 | 0.1% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100% |  |
Manufacture of batteries | 3.4 | 13 | 1.6% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100% | E |
Manufacture of energy efficiency equipment for buildings | 3.5 | 25 | 3.0% | 100% |  |  |  |  |  | N/A | y | y | y | y | y | y | 100% | E |
Cogeneration of heat/cool and power from bioenergy | 4.20 | 20 | 2.4% | 100% |  |  |  |  |  | N/A | y | y | N/A | y | y | y | 52.9% |  |
OpEx of environmentally sustainable activities (Taxonomy- aligned) A.1 |  | 86 | 10.3% |  |  |  |  |  |  |  |  |  |  |  |  |  | 82.9% |  |
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activites) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cogeneration of heat/cool and power from bioenergy | 4.20 | 18 | 2.1% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
OpEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activites) (A.2) |  | 18 | 2.1% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total (A.1+A.2) |  | 104 | 12.5% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
B. TAXONOMY-NON-ELIGIBLE ACTIVITES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
OpEx of Taxonomy-non-eligible activites (B) |  | 733 | 87.5% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total (A+B) |  | 837 | 100% |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

Environmental investments and liabilities
In 2022 Stora Enso’s environmental investments amounted to EUR 82 (50) million. These
investments were mainly to improve the quality of air and water, to enhance resource and
energy efficiency, and to minimise the risk of accidental spills.
Stora Enso’s environmental costs in 2022 excluding interest and including depreciation
totalled EUR 243 (191) million. These costs include taxes, fees, refunds, permit-related costs,
and repair and maintenance costs, as well as wastewater treatment chemicals and certain other
materials. The reporting scope was changed in 2022 to exclude the payments related to
provisions from environmental remediation projects. Due to this, the total costs for 2021 have
been restated.
Provisions for environmental remediation amounted to EUR 73 (75) million at 31 December
2022, details of which are in Note 22. There are currently no active or pending legal claims
concerning environmental issues that could have a material adverse effect on Stora Enso’s
financial.
Unaudited 17
Risks and risk management
Our approach to risk management
Risk is an integral element of business and corporate governance, and it is characterised by
both threats and opportunities, which may have an impact on future performance and the
financial results of Stora Enso, as well as on its ability to meet certain social and environmental
objectives. Stora Enso is committed to ensuring that systematic, holistic and proactive
management of risks and opportunities is among its organisational core capabilities, and that a
culture is fostered where both are carefully considered in all business decisions. Through
consistent application of dynamic risk analysis and scenario planning, we enhance opportunities
and manage risk in order to reduce threats which may prevent us from reaching our business
goals.
Risk governance
Stora Enso defines risk as the effect of uncertainty on our ability to meet organisational values,
objectives and goals. The Group Risk Policy, which is approved by the Board of Directors, sets
out the overall approach to governance and the management of risks in accordance with the
COSO (Committee of Sponsoring Organizations) framework and in line with the ISO 31000
standard. The Board retains the ultimate responsibility for the overall risk management process
and for determining predominantly through Group policies the appropriate and acceptable level
of risk.
The Board has established a Financial and Audit Committee to provide support to the Board
in monitoring the adequacy of the risk management process within Stora Enso, and specifically
regarding the management and reporting of financial risks. This oversight scope includes also
monitoring of the cybersecurity risk. The Sustainability and Ethics Committee is responsible for
overseeing the company’s sustainability and ethical business conduct, its strive to be a
responsible corporate citizen, and its contribution to sustainable development.
The head of Enterprise Risk Management, reporting to the Chief Strategy and Innovation
Officer, is responsible for the design, development and monitoring of the top-down
implementation of the Group risk management framework. Each division and Group function
head, together with their respective management teams, are responsible for process execution
and cascading the framework and guidelines further down in the organisation. The Internal Audit
unit evaluates the effectiveness and efficiency of the Stora Enso risk management process.
Risk management process
Risk management is embedded in all decision-making processes, with holistic risk assessments
conducted also as part of all significant investment decisions. In connection with the annual
strategy process, business divisions and group service and support functions conduct a holistic
baseline risk assessment, linked to their key objectives. Specific guidance regarding the risk
management process is outlined in the enterprise risk management instructions.
Business entities and functions identify the sources of risk events including changes in
circumstances and their causes and potential consequences. Stora Enso’s risk model outlines
the overall risk universe which is used to support holistic risk identification and risk consolidation,
while also providing taxonomy as well as consistency in risk terminology.
Risk analysis involves developing an understanding of the risk to provide an input for risk
evaluation. The purpose of risk evaluation is to determine the risk priorities and to support
decision making to determine which risks require treatment/actions. Risks are assessed in terms
of their impact and likelihood of occurrence, often based on specific risk scenarios. The
effectiveness of existing risk reduction is factored in to define the residual risk level. Pre-defined
impact scales consider financial, safety and reputational impacts, on both a quantitative and
qualitative basis.
Risk treatment involves selecting one or more risk management option, such as avoidance,
reduction, sharing or retention. Additional risk mitigation actions are determined for risks which
exceed the perceived risk tolerance incorporating the assignment of responsibility, schedule and
timetable of the risk response actions.
Following the annual baseline assessment, prioritised and emerging risks, as well as the
corresponding risk mitigation and business continuity plans related to those risks, are reviewed
in divisional business review meetings on a semi-annual basis.
Despite the measures taken to manage risks and mitigate the impact of risks, and while some
of the risks remain beyond the direct control of the management, there can be no absolute
assurance that risks, if they occur, will not have a materially adverse effect on Stora Enso’s
business, financial condition, operating profit or ability to meet financial obligations.
Main risks
Macroeconomy, geopolitics, and currency rates
Changes in global economic conditions, such as sharp market corrections and foreign exchange
volatility, could have a negative and material impact on Stora Enso's profit, cash flows and
financial position.
Stora Enso is exposed to several financial market risks that the Group is responsible for
managing under policies approved by the Board of Directors. The objective is to achieve cost-
effective funding in Group companies and manage financial risks by using financial instruments
to reduce earnings volatility. The main exposures for the Group, besides currency risk, are
interest rate risk, liquidity risk, refinancing risk, commodity price risk and credit risk. Financial
risks are discussed in detail in Note 24, Financial risk management.
Mitigation measures and opportunities
Stora Enso has a diversified portfolio of businesses which mitigates exposure to any one country
or product segment. The external environment is continuously monitored and planning
assumptions take account of important near- to medium-term and long-term drivers and risks
related to key macro-economic factors. The compliance to the Board-approved risk appetite is
closely monitored and cash flow and liquidity are actively managed. Stora Enso hedges 15–60%
of the highly probable 12-month net foreign exchange flows in main currency pairs. Currency
translation risk is reduced by funding assets, whenever economically possible, in the same
currency as the asset. The divisions regularly monitor their order flows and other leading
indicators, where available, so that they may respond quickly to a deterioration in trading
conditions. In the event of a significant deterioration in general economic condition and in main
leading economic indicators, the Group has a possibility to implement cost reduction measures
to offset the impact on margins from deterioration in sales.
Competition and market demand
The packaging, pulp, paper and wood products industries are mature, capital intensive and
highly competitive. Stora Enso’s principal competitors include several large international forest
products companies and numerous regional and more specialised competitors. Customer
demand is influenced by the general economic conditions and inventory levels and affects
product price levels. Product prices, which tend to be cyclical, are affected by capacity utilisation,
which decreases in times of economic slowdowns. Changes in prices differ between products
and geographic regions.
Unaudited 18
The following table shows the operating profit sensitivity to a +/- 10% change in either price or
volume for different segments based on figures for 2022.
Operating profit: Impact of changes +/- 10%, EUR million

Segments | Price | Volume
Packaging Materials | 447 | 125
Packaging Solutions | 72 | 19
Biomaterials | 205 | 101
Wood Products | 215 | 67
Forest | 249 | 11
Paper | 163 | 43

Mitigation measures and opportunities
The ability to respond to changes in product demand and consumer preferences and to develop
new products on a competitive and economic basis calls for innovation, continuous capacity
management and structural development. The risks related to factors such as demand, price,
competition and customers are regularly monitored by each division and unit as a routine part of
business management. These risks are also continuously monitored and evaluated on a Group
level to gain a perspective of the Group’s total asset portfolio and overall long-term profitability
potential.
Stora Enso, as one of the biggest private forest owners in the world, also benefits from a
strategic renewable resource base. The Group's expertise in wood and wood based renewable
materials is focused on responding to changing customer and consumer preferences, driven by
climate change. Products based on renewable materials with a low carbon footprint help
customers and society at large to reduce CO 2 emissions by providing an alternative to solutions
based on fossil fuels or other non-renewable materials.
Sourcing
Increasing input costs or availability of materials, goods and services may adversely affect Stora
Enso’s profitability. Securing access to reliable low-cost supplies and proactively managing costs
and productivity are of key importance. Reliance on outside suppliers for energy also makes
Stora Enso susceptible to changes in energy market prices. There is also an increased risk of
disturbances in the supply chain due to cyber incidents, political instability and other drivers
related to global trade. The following table shows Stora Enso’s major cost items.
Composition of costs in 2022

Operative costs | % of costs | % of sales
Logistics and commissions | 12% | 10%
Manufacturing costs |  |
Fiber | 33% | 27%
Chemicals and fillers | 10% | 9%
Energy | 9% | 8%
Material | 11% | 9%
Personnel | 13% | 11%
Other | 7% | 6%
Depreciation | 5% | 5%
Total costs and sales | 100% | 85%
Total operative costs and sales in EUR million | 9,847 | 11,680
Equity accounted investments (EAI), operational |  | 58
Operational EBIT (EUR million) |  | 1,891

In many areas Stora Enso is dependent on suppliers and their ability to deliver a product or a
service at the right time and of the right quality. The most important products are fiber, chemicals
and energy, and machinery and equipment in capital investment projects. Increased demand for
carbon neutral primary and secondary biomass fuels may increase energy costs. The most
important services are transport and various outsourced business support services. For some of
these inputs, the limited number of suppliers is a risk.
Mitigation measures and opportunities
Input cost volatility is closely monitored at the business unit, divisional and group level and a
consistent long-term energy risk management is applied. The price and supply risks are
mitigated through increased own generation, shareholding in competitive power assets such as
PVO/TVO, physical long-term contracts and financial derivatives. Stora Enso hedges price risks
in raw material and end-product markets and supports the development of financial hedging
markets. A wide range of suppliers are used and monitored to avoid situations that might
jeopardise continued production, business transactions or development projects.
Suppliers and subcontractors must also comply with Stora Enso’s sustainability requirements
as they are part of Stora Enso’s value chain. The sustainability requirements for suppliers and
audit schemes cover raw materials, and other goods and services procured. Suppliers are
assessed for risks related to environmental, social and business practices through our internal
risk assessment tool. Supplier code of conduct audits are conducted on high-risk suppliers and
findings from such audits are followed-up. Suppliers should have the possibility to mitigate, but
where necessary, the supplier contract would be terminated.
Stora Enso also has an opportunity to add value and bring innovation to its business globally
by building strong and measurable relationships with the best suppliers as well as enforcing
harmonised sourcing processes to increase capabilities, increase tender quality to reduce cost,
and develop sustainable suppliers.
Regulatory changes
Stora Enso's businesses may be affected by political or regulatory developments in any of the
countries and jurisdictions where it operates, including changes to forest, biodiversity,
environmental, fiscal, tax or other regulatory regimes. Potential impacts include higher costs
and capital expenditure to meet new requirements, the expropriation of assets, imposition of
royalties or other taxes targeted at the industry, and requirements for local ownership or
beneficiation.
The EU Green Deal and its climate targets for 2030 and 2050 have resulted in a proliferation
of future legislation which have been further advanced in 2022 and may impact Stora Enso's
future operations. The policy initiatives from the European Commission will include policies and
legislation on areas such as EU Forest and Biodiversity strategies, the Renewable Energy
Directive, EU Emission Trading System (ETS), Sustainable products initiative, Packaging and
Packaging waste revision as well as EU taxonomy.
Political decisions on forest resources, could limit the availability of wood, increase costs and
reduce investment opportunities.
Stora Enso has been granted various investment subsidies and has given certain investment
commitments in different countries e.g. Finland, China and Sweden. If committed planning
conditions are not met, local officials may pursue administrative measures to reclaim some of
the formerly granted investment subsidies or to impose penalties on Stora Enso, and the
outcome of such a process could result in a negative financial impact on Stora Enso.
Unaudited 19
Mitigation measures and opportunities
Active monitoring of regulatory and political developments in the countries where Stora Enso
operates as well as participation in policy development mainly through industry associations and
other partnership programmes are important risk mitigation regarding regulatory changes.
Regulatory changes can also bring significant opportunities by driving market growth for
sustainable products and create competitive advantage through resource efficiency and
renewability.
Climate change – physical impacts
Long-term (25–30 years) changes in precipitation patterns, periods of drought, frequent extreme
weather events and higher average temperatures that increase the risk of forest fires and insect
outbreaks, could cause damage to operations, forests and tree plantations, affecting forests
asset values and regional wood prices. Milder winters could also have an impact on the
harvesting and transport of wood and related costs in northern regions. More frequent extreme
weather events also increase the risk of disruptions in the production, logistics and supply of raw
ma terials and energy.
During 2022, a quantitative analysis regarding climate resilience was conducted in the South
American plantations based on three scenarios: SSP1-1.9 (~1.5⁰C and net-zero CO₂ emissions),
SSP2-4.5 (~2.7⁰C and CO₂ emissions are similar to current) and SSP5-8.5 (~4.4⁰C and CO₂
emissions are double that of the current). Results show a relative resilience of the plantations.
Financial consequences are not expected to be material in SSP1-1.9 and SSP2-4.5 scenarios,
but could be material in SSP5-8.5. Read more in the following chapter TCFD, and in an index
table available at storaenso.com.
Mitigation measures and opportunities
Physical risks are to a great extent subject to risk transfer and thereby within the cover of Stora
Enso's property and business interruption insurance programs. With regards to forest and
plantation assets, Stora Enso benefits from strategic resilience through geographical
diversification within the asset portfolio. Diligent plantation planning is ensured to avoid frost
sensitive areas and R&D programmes are applied to increase tolerance to extreme
temperatures. Stora Enso maintains a diversity of forest types and structures and enforces
diversification in wood sourcing. Wood harvesting in soft soils involves the implementation of
best practices guidelines.
Nordic forests in Finland and Sweden could also benefit from increased heat summation and
longer growing seasons, leading to acceleration in forest growth with direct positive impact on
the value of own forest assets and an indirect impact related to market wood availability and
costs.
People and capabilities
Competition for personnel is intense and Stora Enso may, in the long term, not be successful in
attracting or retaining qualified personnel. The loss of key employees, the inability to attract new
or adequately trained employees, or a delay in hiring key personnel could seriously harm Stora
Enso’s business and impede reaching the Group's strategic objectives. Labour market
disruptions and strikes, especially in times of restructuring and redundancies due to divestments
and mill closures or during labour market negotiations, could also have adverse material effects
on Stora Enso's business, financial position and profitability.
Mitigation measures and opportunities
Stora Enso manages the risks and loss of key talents through a combination of different actions.
Some of the activities aim towards making the Stora Enso employer brand better known both
internally and externally, globalising some of the remuneration practices and intensifying the
efforts to identify and develop talents. Finally, the Group actively focuses on talent and
management assessments, including succession planning for key positions. The majority of
employees are represented by labour unions under several collective agreements in different
countries where Stora Enso operates, thus relations with unions are of high importance to
manage labour disruption risks.
Stora Enso recognises the opportunity of skilled and dedicated employees being essential for
success. Engaged high performing people enable the implementation of transformation strategy
and commercial success.
Personal safety – employees and wider workforce
Failure to maintain high levels of safety management can result in harm to Stora Enso’s
employees and contractors, and also to communities near our operations and the environment.
Impacts in addition to physical injury, health effects and environmental damage could include
liability to employees or third parties, damage to reputation, or an inability to attract and retain
skilled employees. Government authorities could additionally enforce the closure of our
operations on a temporary basis.
Personnel safety and security can never be compromised and, thus, Stora Enso must be
aware of potential safety risks and provide adequate guidelines to people for managing risks
related to, for example, travelling, working and living in countries with security or crime concerns.
Mitigation measures and opportunities
Stora Enso’s goal is to provide an accident-free workplace. Encouraging a company-wide safety
culture means that everyone is responsible for making every workday healthy and safe - from
top management and throughout the company. The approach to safety extends to contractors,
suppliers, and on-site visitors. Everyone is encouraged to give feedback and provide ideas on
how to further improve safety. Additionally, safety is promoted among contractors and suppliers
through a dedicated e-learning. The Group also emphasise the importance of safety by asking
suppliers for information on their safety performance in the tendering process.
Stora Enso’s Health and Safety Policy defines the objectives for safety management, as well
as a governance model on how to manage health and safety topics in practice and how to
integrate them into annual planning and reporting.
Leading health and safety performance can potentially strengthen the brand as an employer,
as well as improved engagement, efficiency and productivity.
Physical assets
The installed capacity of Stora Enso's production facilities have an inherent risk of potential for
failure or off-specification operations, which could result in poor product quality, unplanned
production downtime, lower output or increased production costs. It may also impact the
company's ability to meet delivery commitments and the business plan. In some instances, the
risks are the result of inherent design deficiencies, failures in the mode of operation or operating
practices. The most significant asset risks lie predominantly in integrated pulp and board
production and related energy generation.
Unaudited 20
Mitigation measures and opportunities
Protecting production assets and business results is a high priority for Stora Enso. This is
achieved through structured methods of identifying, measuring and controlling different types of
process risk and exposure. Divisional risk specialists manage this process together with
insurance companies and other loss prevention specialists. Each year a number of technical risk
inspections are carried out at production units. Risk improvement programmes and cost-benefit
analyses of proposed investments are managed via internal reporting and risk assessment tools.
Internal and external property loss prevention guidelines, fire loss control assessments, key
machinery risk assessments and specific loss prevention programmes are also utilised. Planned
stoppages for maintenance and other work are important to keep machinery in good order.
Preventive maintenance programmes and spare part criticality analyses are utilized to secure
the high availability and efficiency of key machinery.
Product safety and compliance
Some of our products are used for package liquids and food consumer products, so any defects
could affect health or packaging functions and result in costly product recalls. Wood products are
incorporated into buildings, and this may involve product liability resulting from failures in
structural design, product selection or installation. Failure to ensure product safety could result in
product recalls involving significant costs including compensation for indirect costs of customers,
and reputational damage.
Mitigation measures and opportunities
The mills producing food and drink contact products have established certified hygiene
management systems based on risk and hazard analysis. To ensure the safety of its products,
Stora Enso actively participates in CEPI (Confederation of European Paper Industry) working
groups on chemical and product safety. In addition, Stora Enso mills have certified relevant ISO
quality management systems. Furthermore, contractual liability limitation and insurance
protection are used to limit the risk exposure to Stora Enso.
The Group recognises the opportunity of differentiation and value creation through superior
product quality and the highest level of product conformity.
Information technology, security, and digitalisation
Stora Enso is dependent on IT systems for both internal and external communications and for
the day-to-day management of its operations. Information systems, personnel and facilities are
subject to cyber security risk, such as ransomware. In addition, accidental disclosure of
confidential information due to a failure to follow information handling guidelines or due to an
accident or criminal act may result in financial damage, penalties, disrupted or delayed launch of
new lines of business or ventures, loss of customer and market confidence, loss of research
secrets, breach of data privacy regulation and other business critical information.
Mitigation measures and opportunities
The management of risks is actively pursued in the Information Risk Management System and
best practice change management and project methodologies are applied. We actively work to
prevent cybercrime. A number of security controls have been implemented to strengthen the
protection of confidential information and to facilitate compliance with international regulations.
Opportunities may arise from efficient operations, performance optimisation, innovative
product offerings, and new customer services through digitisation and sophisticated IT systems,
as well as new technologies offering significant potential for higher level of process optimisation
and automatisation, generating new business and enhanced value propositions for customers
and consumers.
Strategic investments
To succeed with the implementation of its strategy, Stora Enso has to understand the needs of
its customers and find the best way to serve them with the right offering and with the right
production asset portfolio. Failure to complete strategic projects in accordance with the agreed
schedule, budget or specifications can, therefore, have serious impacts on the company's
financial performance. Significant, unforeseen changes in costs or an inability to sell the
envisaged volumes or achieve planned price levels may prevent Stora Enso from achieving its
business goals.
Mitigation measures and opportunities
Risks are mitigated through profound and detailed pre-feasibility and feasibility studies which are
prepared for each large investment. Investment guidelines stipulate the process, governance,
risk assessment, management and monitoring procedures for strategic projects, including
climate related risk factors. The guidelines also require that the calculation of potential cost and
income for CO 2 emissions as part of the investment proposal, Environmental and Social Impact
Assessments (ESIAs) are conducted for all new projects that could cause significant adverse
effects in local communities. Post completion audits are carried out for all significant
investments.
Mergers, acquisitions, and divestments
Failure to realise the expected benefits from an acquisition of a company or asset can have
serious financial impacts on Stora Enso. The Group can also find itself liable for past acts or
omissions of the acquired business, without any adequate right of redress. Failure to achieve
expected values from the sales of assets or deliveries beyond the expected receipt of funds may
also impact the Group's financial position. Divestments or business restructuring may involve
additional costs due to historical and unaccounted liabilities as well as reputational impacts.
Mitigation measures and opportunities
Rigorous M&A guidelines, including due diligence procedures are applied to the evaluation and
execution of all acquisitions. Structured governance and policies such as the policy for
responsible right-sizing, are followed when making restructuring decisions. A strong balance
sheet and cash flow enable value enhancing M&A, when the timing and opportunity are right.
Ethics and compliance
Stora Enso operates in a highly regulated business area and is, thereby, exposed to risks related
to breach of applicable laws and regulations associated to e.g. capital markets regulation,
company and tax laws, customs, environment, human rights, and safety, as well as areas
covered by policies such as the Stora Enso Code and Business Practice Policy, e.g. fraud, anti-
trust, corruption, conflict of interests and other misconduct. Breaches may lead to high
compliance and remediation costs including prosecution costs, fines, penalties, and contractual,
financial and reputational damage.
Mitigation measures and opportunities
Stora Enso’s Ethics and Compliance Programme, which includes policy setting, promoting
values, training, knowledge sharing and grievance mechanisms, is continuously updated and
developed. Other compliance mechanisms include Stora Enso Group’s internal control system
Unaudited 21
and Internal Audit assurance, as well as Supplier Code of Conduct in supplier contracts, risk
assessments, trainings and audits. In response to capital markets regulations, Stora Enso’s
Disclosure Policy emphasises the importance of transparency, credibility, responsibility,
proactivity and interaction.
Environmental risks are minimised through environmental management systems and
environmental due diligence for acquisitions and divestments, and indemnification agreements
where effective and appropriate remediation projects are required. Special remediation projects
related to discontinued activities and mill closures are executed based on risk assessments.
Focus on ethics in a wider sense, not mere compliance with laws and regulations, promotes a
value-driven and more successful business, fosters accountability and enhances corporate
reputation.
Climate-related financial disclosures (TCFD)
The Financial Stability Board’s (FSB) Task Force on Climate-related Financial Disclosures
(TCFD) recommends a framework for disclosing climate-related risks and opportunities. Stora
Enso's disclosures with reference to TCFD recommendations are listed in an online index table,
available at storaenso.com, with references to those locations where these issues are
addressed in the Group's annual reporting.
Scenario analysis in 2022
Aligned with the TCFD recommendations, Stora Enso utilises scenarios to assess the impacts of
climate change.
During 2022, a quantitative resilience analysis was conducted for tree plantations in South
America against three global Shared Socioeconomic Pathway (SSP) scenarios: SSP1-1.9
(Sustainability – Taking the Green Road), SSP2-4.5 (Regional Rivalry – a Rocky Road) and
SSP5-8.5 (Fossil-fuelled Development – Taking the Highway). Results show a relative resilience
of Stora Enso's tree plantations in all the three scenarios. Financial impacts are not expected to
be material in SSP1-1.9 and SSP2-4.5 scenarios but in SSP5-8.5 scenario the growth conditions
of tree plantations would be affected resulting in potentially material financial impacts.
Scenario analysis the during previous years
In 2020, Stora Enso developed a scenario analysis with the qualitative assessment of the
physical climate impacts on the Nordic forests and the Group's business until 2050. This work
was based on the Business-As-Usual scenario by the International Panel for Climate Change
(RCP 8.5 scenario) that would deliver a temperature increase of 4–5 degrees by the end of the
century. The climate change attributes considered were pests, diseases, droughts, wildfires,
floods, periods of frost, water scarcity, changes to precipitation patterns, rise in sea level and
changing temperatures. In 2021, the work with physical climate impacts continued by a deeper
analysis of measures improving resiliency of the forests against the negative impacts of global
warming. Results showed that sustainable forest management practices as well as possibilities
to monitor and to react to events such as forest fires and diseases, play an important role in
mitigating the negative impacts of climate change.
During 2021, Stora Enso assessed a business impact scenario for 2030 according to the
global transition required to limit the global average temperature increase in line with the Paris
agreement of 1.5 degrees (RCP 1.9). The work concluded that the overall transition to a low
carbon, circular bioeconomy is well aligned with Stora Enso’s strategy. The scenario work also
showed that potential new regulations and market mechanisms motivated by the ambitions to
limit climate change and its effects on the society and environment could impact Stora Enso’s
operating costs by limiting wood harvesting volumes or forest management practices as well as
increasing greenhouse gas emission costs and energy prices. Sustainable product initiatives
and requirements may also have an impact on the Group's future market access, product
demand growth and product development requirements.
Corporate governance in Stora Enso
Stora Enso complies with the Finnish Corporate Governance Code 2020 issued by the
Securities Market Association (the “Code”). The Code is available at cgfinland.fi. Stora Enso also
complies with the Swedish Corporate Governance Code (“Swedish Code”), with the exception of
the deviations listed in Appendix 1 of the Corporate Governance part of this report. The
deviations are due to differences between Swedish and Finnish legislation, governance code
rules and practices, and in these cases Stora Enso follows the practice in its domicile. The
Swedish Code is issued by the Swedish Corporate Governance Board and is available at
corporategovernanceboard.se.
Legal proceedings
Contingent liabilities
Stora Enso has undertaken significant restructuring actions in recent years which have included
the divestment of companies, sale of assets and mill closures. These transactions include a risk
of possible environmental or other obligations the existence of which would be confirmed only by
the occurrence or non-occurrence of one or more uncertain future events not wholly within the
control of the Group. A provision has been recognised for obligations for which the related
amount can be estimated reliably and for which the related future cost is considered to be at
least probable.
Stora Enso is party to legal proceedings that arise in the ordinary course of business and
which primarily involve claims arising out of commercial law. The management does not
consider that liabilities related to such proceedings before insurance recoveries, if any, are likely
to be material to the Group’s financial condition or results of operations.
European Commission inspection
As announced in Stora Enso’s stock exchange release on 12 October 2021, the European
Commission has conducted unannounced inspections in locations at several member states at
the premises of companies active in the wood pulp sector. Stora Enso was included in the
European Commission’s inspection at its headquarters in Helsinki, Finland.
Stora Enso is cooperating fully with the authorities. As stated by the Commission, the fact that
they carry out such inspections does not mean that the companies are guilty of anti-competitive
behaviour nor does it prejudge the outcome of the investigation itself.
Stora Enso is under strict confidentiality rules regarding the details of the ongoing European
Commission investigation and cannot pre-empt or speculate regarding the next steps or
eventual outcome of the investigation.
Veracel
On 11 July 2008, Stora Enso announced that a federal judge in Brazil had issued a decision
claiming that the permits issued by the State of Bahia for the operations of Stora Enso’s joint
operations company Veracel were not valid. The judge also ordered Veracel to take certain
actions, including reforestation with native trees on part of Veracel’s plantations and a possible
fine of, at the time of the decision, BRL 20 (EUR 4) million. Veracel disputes the decision and
has filed an appeal against it. Veracel operates in full compliance with all Brazilian laws and has
obtained all the necessary environmental and operating licences for its industrial and forestry
Unaudited 22
activities from the relevant authorities. In November 2008, a Federal Court suspended the
effects of the decision. No provisions have been recorded in Veracel’s or Stora Enso’s accounts
for the reforestation or the possible fine.
Changes in the Group management
René Hansen joined Stora Enso as EVP, Brand and Communications and a member of the
Group Leadership Team in February 2022.
Teemu Salmi, CIO, Head of IT & Digitalisation and a member of the Group Leadership Team
left his position at Stora Enso in May. Seppo Parvi, CFO, assumed the responsibility for the IT &
Digitalisation organisation.
Kati ter Horst, EVP Paper division and a member of the Group Leadership Team, left her
position at Stora Enso in July. Seppo Parvi, CFO, assumed the responsibility for the Paper
division.
Jari Suominen, EVP Forest division and a member of the Group Leadership Team, left his
position at Stora Enso in December.
Per Lyrvall, previously EVP Legal, was appointed as new EVP Forest division. He continues
as a member of the Group Leadership Team and as Stora Enso's country head for Sweden. The
search for a new General Counsel is ongoing. In the interim period, Christian Swartling, SVP
Group Legal, assumes the acting role in the position.
Minna Björkman was appointed EVP Sourcing and Logistics and a member of the Group
Leadership Team as of January 2023. Minna Björkman joined Stora Enso in 2019 as Senior Vice
President, Supply Chain and Operational Excellence for Packaging Solutions. Prior to joining
Stora Enso, she held several senior level positions at Finnish companies such as Nokia, Fazer
and Kemira.
Share capital
Stora Enso Oyj’s shares are divided into A and R shares. The A and R shares entitle holders to
the same dividend but different voting rights. Each A share and each ten R shares carry one vote
at a shareholders’ meeting. However, each shareholder has at least one vote. During 2022, a
total of 5,769 A shares converted into R shares were recorded in the Finnish Trade Register.
Number of shares as at 31 December 2022

| A shares | R shares | Total
Number of shares | 176,238,280 | 612,381,707 | 788,619,987
Number of votes (at least) | 176,238,280 | 61,238,171 | 237,476,451

Board of Directors is authorised to decide on the repurchase and on the issuance of Stora Enso
R shares. The amount of shares to be issued or repurchased shall not exceed a total of
2 000 000 R shares, corresponding to approximately 0.25% of all shares and 0.33% of all R
shares.
Major shareholders as of 31 December 2022

By voting power | A shares | R shares | % of shares | % of votes
1 | Solidium Oy 1 | 62,655,036 | 21,792,540 | 10.7% | 27.3%
2 | FAM AB 2 | 63,123,386 | 17,000,000 | 10.2% | 27.3%
3 | Social Insurance Institution of Finland | 23,825,086 | — | 3.0% | 10.0%
4 | Ilmarinen Mutual Pension Insurance Company | 4,172,492 | 14,900,000 | 2.4% | 2.4%
5 | Varma Mutual Pension Insurance Company | 5,163,018 | 1,140,874 | 0.8% | 2.2%
6 | MP-Bolagen i Vetlanda AB | 4,885,000 | 1,000,000 | 0.7% | 2.1%
7 | Elo Mutual Pension Insurance Company | 2,000,000 | 7,601,000 | 1.2% | 1.2%
8 | Bergslaget's Healthcare Foundation | 626,269 | 1,609,483 | 0.3% | 0.3%
9 | SEB Investment Management | — | 6,976,453 | 0.9% | 0.3%
10 | The State Pension Fund | — | 5,000,000 | 0.6% | 0.2%
11 | The Society of Swedish Literature in Finland | — | 3,000,000 | 0.4% | 0.1%
12 | Avanza Pension Insurance | 146,285 | 1,268,398 | 0.2% | 0.1%
13 | Unionen (Swedish trade union) | — | 2,612,750 | 0.3% | 0.1%
14 | Afa Insurance | — | 2,381,676 | 0.3% | 0.1%
15 | SEB AB, Luxembourg Branch | 2,177 | 1,785,231 | 0.2% | 0.1%
| Total | 166,598,749 | 88,068,405 | 32.3% | 73.9%
| Nominee-registered shares 3 | 75,058,822 | 496,088,402 | 72.4% | 52.5%
| 1 Entirely owned by the Finnish State. 2 As confirmed to Stora Enso. 3 According to Euroclear Finland. The list has been compiled by the Company on the basis of shareholder information obtained from Euroclear Finland, Euroclear Sweden and a database managed by Citibank, N.A (Citi). This information includes only directly registered holdings, thus certain holdings (which may be substantial) of shares held in nominee or brokerage accounts are not included. The list is therefore incomplete.

Share distribution as at 31 December 2022

By size of holding, A share | Shareholders | % of shareholders | Shares | % of shares
1–100 | 6,834 | 59.28% | 264,473 | 0.15%
101–1,000 | 4,120 | 35.74% | 1,463,504 | 0.83%
1,001–10,000 | 542 | 4.70% | 1,257,741 | 0.71%
10,001–100,000 | 22 | 0.19% | 473,102 | 0.27%
100,001–1,000,000 | 2 | 0.02% | 284,687 | 0.16%
1,000,001– | 8 | 0.07% | 172,494,773 | 97.88%
Total | 11,528 | 100.00% | 176,238,280 | 100.00%
By size of holding, R share | Shareholders | % of shareholders | Shares | % of shares
1–100 | 16,974 | 36.76% | 821,972 | 0.13%
101–1,000 | 22,825 | 49.43% | 9,047,232 | 1.48%
1,001–10,000 | 5,868 | 12.71% | 15,492,151 | 2.53%
10,001–100,000 | 435 | 0.94% | 11,584,478 | 1.89%
100,001–1,000,000 | 58 | 0.13% | 20,922,126 | 3.42%
1,000,001– | 17 | 0.04% | 554,513,748 | 90.55%
Total | 46,177 | 100.00% | 612,381,707 | 100.00%
According to Euroclear Finland. This list includes only directly registered shares in Euroclear Finland. E.g. Stora Enso's Swedish shareholders are listed under their nominee bank in this list.

Unaudited 23
Ownership distribution as at 31 December 2022

| % of shares | % of votes
Solidium Oy 1 | 10.7% | 27.3%
FAM AB 2 | 10.2% | 27.3%
Social Insurance Institution of Finland (KELA) | 3.0% | 10.0%
Finnish institutions (excl. Solidium and KELA) | 9.8% | 7.7%
Swedish institutions (excl. FAM) | 1.9% | 1.1%
Finnish private shareholders | 3.9% | 2.4%
Swedish private shareholders | 3.1% | 2.3%
ADR holders | 1.7% | 0.6%
Under nominee names (non-Finnish/non-Swedish shareholders) | 55.7% | 21.3%
1 Entirely owned by the Finnish State. 2 As confirmed to Stora Enso.

Outlook
Stora Enso remains vigilant against persisting market disruptions and uncertainties,
macroeconomic environment and inflationary pressures. Stora Enso enters the new year with
market softness and variable cost pressures which are expected to be more challenging in 2023
than in 2022 weighing on our results this year. The high macroeconomic uncertainty and
continued weak consumer confidence resulting in lower private consumption will continue to
impact negatively, especially on containerboard demand. Lower demand in the construction
sector remains challenging and is expected to especially impact on the demand for traditional
sawn wood. Compared to 2022, Group margins are expected to be squeezed by increasing
costs, particularly in relation to energy, wood, chemicals and logistics.
To manage volatility, variable costs are continually reviewed, and preparatory actions are
taken to be prepared to respond to fluctuations in demand with reinforced cost control. Other
measures such as pricing, flexibility in product mix, capacity and inventory management, and
sourcing and logistics are in place. Stora Enso in Finland has completed negotiations on
potential furloughs at its Wood Products division, and this year started negotiations on potential
furloughs at its Packaging Materials division’s production sites. Activities on adjusting capacity to
respond to fluctuations in demand have also been put in place for the Wood Products division’s
sites in other countries. Stora Enso also benefits from its high self-sufficiency in energy of 72%
as well as hedging, and from its ~30% self-sufficiency of wood.
The Group has made extensive changes to reshape the business over the past three years
under its new leadership and disciplined capital allocation is firmly integrated to the Group's day
to day operations. Stora Enso is now financially, operationally and strategically in better shape to
handle market fluctuations and at the same time, invest for growth in renewable packaging,
sustainable building solutions and biomaterials innovations.
Guidance
Stora Enso's full-year 2023 operational EBIT is expected to be lower than for the full-year 2022
(EUR 1,891 million).
Short-term risks and uncertainties
Risk is characterised by both threats and opportunities, which may have an impact on future
performance and the financial results of Stora Enso, as well as on its ability to meet certain
social and environmental objectives.
The rapidly changing macroeconomic and geopolitical disruption is increasing complexity.
The sanctions on Russia, retaliatory measures as well as conflict-related risks to people,
operations, trade credit, cyber security, supply, and demand, could all have an adverse impact
on the Group.
There is a risk of continued higher cost inflation in general and in components such as
chemicals, and increased price volatility for raw materials such as wood, components and
energy in Europe, as well as continued logistical disruptions across the markets. The high
market demand for wood could cause disruptions such as delays and/or lack of wood supply to
the Group's production sites. The increased risk of a global economic downturn and recession,
as well as sudden interest rate increases and currency fluctuations, could all affect the Group’s
profits, cash flow and financial position negatively.
Other risks and uncertainties include, but are not limited to; general industry conditions,
unanticipated expenditures related to the cost of compliance with existing and new
environmental and other governmental regulations, and related to actual or potential litigation;
material process disruption at one of Stora Enso's manufacturing facilities with operational or
environmental impacts; risks inherent in conducting business through joint ventures; and other
factors that can be found in Stora Enso’s press releases and disclosures.
Stora Enso has been granted various investment subsidies and has given certain investment
commitments in several countries e.g. Finland, China and Sweden. If commitments to planning
conditions are not met, local officials may pursue administrative measures to reclaim some of
the formerly granted investment subsidies or to impose penalties on Stora Enso, and the
outcome of such a process could result in adverse financial impact on Stora Enso.
Sensitivity analysis
Energy sensitivity analysis: the direct effect of a 10% change in electricity and fossil fuel market
prices would have an impact of approximately EUR 40 million on operational EBIT for the next 12
months.
Wood sensitivity analysis: the direct effect of a 10% change in wood prices would have an
impact of approximately EUR 236 million on operational EBIT for the next 12 months.
Pulp sensitivity analysis: the direct effect of a 10% change in pulp market prices would have
an impact of approximately EUR 165 million on operational EBIT for the next 12 months.
Chemical and filler sensitivity analysis: the direct effect of a 10% change in chemical and filler
prices would have an impact of approximately EUR 64 million on operational EBIT for the next
12 months.
Foreign exchange rates transaction risk sensitivity analysis for the next twelve months: the
direct effect on operational EBIT of a 10% strengthening in the value of the US dollar, Swedish
krona and British pound would be approximately positive EUR 114 million, negative EUR 12
million and positive EUR 18 million annual impact, respectively. Weakening of the currencies
would have the opposite impact. These numbers are net of hedges and assuming no changes
occur other than a single currency exchange rate movement in an exposure currency.
The Group's consolidated income statement on operational EBIT level is exposed to a
foreign-currency translation risk worth approximately EUR 164 million expense exposure in
Brazilian real (BRL) and approximately EUR 77 million income exposure in Chinese Renminbi
(CNY). These exposures arise from the foreign subsidiaries and joint-operations located in Brazil
and China, respectively. For these exposures a 10% strengthening in the value of a foreign
currency would have a negative EUR 16 million and a positive EUR 8 million impact on
operational EBIT, respectively.
Unaudited 24
Annual General Meeting
Stora Enso Oyj's Annual General Meeting (AGM) will be held on Thursday 16 March 2023 at
4 p.m. Finnish time at the Marina Congress Center in Helsinki, Finland. More information is
available at storaenso.com/agm
Proposal for the distribution of dividend
The Board of Directors proposes to the AGM that a dividend of EUR 0.60 per share be
distributed on the basis of the balance sheet adopted for the year 2022. The Board of Directors
has assessed the Company’s financial situation and liquidity before making the proposal. There
have been no material changes in the parent company’s financial position since 31 December
2022, the liquidity of the parent company remains good and the proposed dividend does not risk
the solvency of the Company. Stora Enso's policy is to distribute 50% of earnings per share
(EPS) excluding fair valuation over the cycle. In 2022, EPS excluding fair valuation was EUR
1.55.
The Parent Company distributable shareholders’ equity on 31 December 2022 amounted to
EUR 1,970,697,938.32, including the profit for the period of EUR 415,641,225.97. The Board of
Directors proposes to the Annual General Meeting of the Company that the distributable funds
be used as follows:
A dividend of EUR 0.60 per share from the distributable shareholders’ equity to be distributed
on 788,619,987 shares, not to exceed EUR 473,171,992.20, which would leave EUR
1,497,525,946.12 in distributable shareholders’ equity.
The dividend would be paid to shareholders who on the record date of the dividend payment,
20 March 2023, are recorded in the shareholders’ register maintained by Euroclear Finland Oy
or in the separate register of shareholders maintained by Euroclear Sweden AB for Euroclear
Sweden registered shares. Dividends payable to Euroclear Sweden registered shares will be
forwarded by Euroclear Sweden AB and paid in Swedish crowns. Dividends payable to ADR
holders will be forwarded by Citibank N.A. and paid in US dollars.
The Board of Directors proposes to the AGM that the dividend be paid on or about 27 March
2023.
Events after the reporting period
Divestment of paper sites
The divestment of the Nymölla paper site in Sweden to Sylvamo was completed in early
January. The divestments of the Maxau site in Germany to Schwarz Produktion and the Hylte
site in Sweden to Sweden Timber are expected to be completed during H1/2023. The
divestment process for the Anjala paper site was discontinued and the site will be retained in
Stora Enso.
Changes in segment reporting
Stora Enso's segment reporting changed as of 1 January 2023. The Paper division was
discontinued as of 1 January 2023, and it is not reported as a separate segment going forward.
From 1 January 2023 onwards, the Maxau and Hylte paper sites are reported in Segment Other
until the completion of the divestments. The Langerbrugge and Anjala sites, which are retained
in Stora Enso are reported as part of the Packaging Materials division.
From 1 January 2023, the reporting of emerging businesses, including Formed Fiber, Circular
Solutions (biocomposites), and Selfly Stores, was transferred from the Packaging Solutions
division to Segment Other.
The comparative figures will be restated accordingly.
Acquisition of De Jong Packaging Group
In January, Stora Enso finalised the acquisition of the Dutch De Jong Packaging Group for an
enterprise value of approx. EUR 1,020 million. The acquisition will advance Stora Enso’s
strategic direction, accelerate revenue growth and build market share in renewable packaging in
Europe, and provide an entry into the corrugated packaging market in the Netherlands, Belgium,
Germany and the UK. De Jong Packaging Group’s full year 2022 sales is estimated at
approximately EUR 1 billion. Its product portfolio complements and enhances Stora Enso’s
offering, especially in fresh produce, e-commerce and industrial packaging.
Unaudited 25
Calculation of key figures

Operational return on capital employed, operational ROCE (%) | 100 x | Annualised operational EBIT
Capital employed 1, 2
Operational return on operating capital, operational ROOC (%) | 100 x | Annualised operational EBIT
Operating capital 2
Return on equity, ROE (%) | 100 x | Net profit/loss for the period
Total equity 2
Net interest-bearing liabilities |  | Interest-bearing liabilities – interest-bearing assets
Net debt/equity ratio |  | Net interest-bearing liabilities
| Equity 3
Earnings per share (EPS) |  | Net profit/loss for the period 3
| Average number of shares
Payout ratio, excl. FV, % | 100 x | Dividend distribution / share
EPS excl. FV
Dividend and distribution yield, % | 100 x | Dividend distribution / share
Closing price of share
Price/earnings ratio (P/E), excl. FV |  | Closing price of share
| EPS excl. FV
Operational EBIT |  | Operating profit/loss excluding items affecting comparability (IAC) and fair valuations (FV) of the segments and Stora Enso’s share of operating profit/loss excluding IAC and fair valuations of its equity accounted investments (EAI)
Operational EBITDA |  | Operating profit/loss excluding silviculture costs and damage to forests, fixed asset depreciation and impairment, IACs and fair valuations. The definition includes the respective items of subsidiaries, joint arrangements and equity accounted investments.
Net debt/last 12 months’ operational EBITDA ratio |  | Net interest-bearing liabilities
| LTM operational EBITDA
Fixed costs |  | Maintenance, personnel and other administrative type of costs, excluding IAC and fair valuations
Last 12 months (LTM) |  | 12 months prior to the end of reporting period
1 Capital employed = Operating capital – Net tax liabilities 2 Average for the financial period 3 Attributable to owners of the Parent

Non-IFRS measures
The Group’s key non-IFRS performance metric is operational EBIT, which is used to evaluate
the performance of its operating segments and to steer allocation of resources to them.
Operational EBIT comprises the operating profit excluding items affecting comparability (IAC)
and fair valuations from the segments and Stora Enso’s share of the operating profit of equity
accounted investments (EAI), also excluding items affecting comparability and fair valuations.
Items affecting comparability are exceptional transactions that are not related to recurring
business operations. The most common IAC are capital gains and losses, impairments or
impairment reversals, disposal gains and losses relating to Group companies, provisions for
planned restructurings, environmental provisions, changes in depreciation due to restructuring
and penalties. Items affecting comparability are normally disclosed individually if they exceed
one cent per share.
Fair valuations and non-operational items include CO 2 emission rights, non-operational fair
valuation changes of biological assets, adjustments for differences between fair value and
acquisition cost of forest assets upon disposal and the Group’s share of income tax and net
financial items of EAI. Non-operational fair value changes of biological assets reflect changes
made to valuation assumptions and parameters. Operational fair value changes of biological
assets contain all other fair value changes, mainly due to inflation and differences in actual
harvesting levels compared to the harvesting plan. The adjustments for differences between fair
value and acquisition cost of forest assets upon disposal are a result of the fact that the
cumulative non-operational fair valuation changes of disposed forest assets were included in
previous periods in IFRS operating profit (biological assets) and other comprehensive income
(forest land) and are included in operational EBIT only at the disposal date.
Cash flow after investing activities (non-IFRS) is calculated as follows: cash flow from
operations (non-IFRS) excluding cash spent on intangible assets, property, plant and equipment,
and biological assets and acquisitions of EAIs.
List of non-IFRS measures

Operational EBITDA Operational EBITDA margin Operational EBIT Operational EBIT margin Profit before tax excl. IAC and FV Capital expenditure Capital expenditure excl. investments in biological assets Capital employed | Depreciation and impairment charges excl. IAC Operational ROCE Earnings per share (EPS), excl. FV Operational ROOC Net debt/last 12 months' operational EBITDA ratio Cash flow after investing activities

26
Consolidated financial statements
Consolidated income statement

|  | Year ended 31 December
EUR million | Note | 2022 | 2021
Sales | 3 | 11,680 | 10,164
Other operating income | 5 | 326 | 345
Changes in inventories of finished goods and work in progress |  | 258 | 122
Materials and services |  | -6,979 | -5,936
Freight and sales commissions |  | -1,148 | -939
Personnel expenses | 6 | -1,315 | -1,351
Other operating expenses | 5 | -594 | -610
Share of results of equity accounted investments | 13 | 221 | 143
Change in net value of biological assets | 12 | 195 | 328
Depreciation, amortisation and impairment charges | 10 | -635 | -697
Operating profit | 3 | 2,009 | 1,568
Financial income | 8 | 40 | 42
Financial expense | 8 | -191 | -190
Profit before Tax |  | 1,858 | 1,419
Income tax | 9 | -322 | -151
Net profit for the year |  | 1,536 | 1,268
Attributable to |  |  |
Owners of the Parent | 18 | 1,550 | 1,266
Non-controlling Interests | 19 | -13 | 3
Net profit for the year |  | 1,536 | 1,268
Earnings per share |  |  |
Basic earnings per share, EUR | 32 | 1.97 | 1.61
Diluted earnings per share, EUR | 32 | 1.96 | 1.60

Consolidated statement of comprehensive income

|  | Year ended 31 December
EUR million | Note | 2022 | 2021
Net profit for the year |  | 1,536 | 1,268
Other Comprehensive Income (OCI) |  |  |
Items that will not be reclassified to profit and loss |  |  |
Equity instruments at fair value through OCI | 14 | 519 | 501
Actuarial gains and losses on defined benefit plans | 20 | 147 | 126
Revaluation of forest land | 12 | 259 | 225
Share of OCI of equity accounted investments (EAI) | 13 | 58 | 16
Income tax relating to items that will not be reclassified | 9 | -77 | -68
|  | 906 | 800
Items that may be reclassified subsequently to profit and loss |  |  |
Cumulative translation adjustment (CTA) | 28 | -197 | 56
Net investment hedges and loans | 28 | -27 | 14
Cash flow hedges and cost of hedging | 27 | 52 | -35
Share of OCI of non-controlling interests (NCI) | 19 | 0 | -3
Income tax relating to items that may be reclassified | 9 | -6 | 9
|  | -177 | 42
Total comprehensive income |  | 2,265 | 2,110
Attributable to |  |  |
Owners of the Parent |  | 2,278 | 2,110
Non-controlling interests | 19 | -13 | 0
Total comprehensive income |  | 2,265 | 2,110
The accompanying Notes are an integral part of these consolidated financial statements.

27
Consolidated statement of financial position

|  |  | As at 31 December
EUR million |  | Note | 2022 | 2021
Assets |  |  |  |
Goodwill | O | 11 | 244 | 282
Other intangible assets | O | 11 | 121 | 124
Property, plant and equipment | O | 11 | 4,860 | 5,060
Right-of-use assets | O | 11 | 418 | 441
|  |  | 5,643 | 5,907
Forest assets | O | 12 | 6,846 | 6,747
Biological assets | O | 12 | 4,531 | 4,547
Forest land | O | 12 | 2,315 | 2,201
Emission rights | O | 15 | 123 | 137
Equity accounted investments | O | 13 | 832 | 580
Listed securities | I | 14 | 8 | 13
Unlisted securities | O | 14 | 1,437 | 905
Non-current interest-bearing receivables | I | 26 | 120 | 51
Deferred tax assets | T | 9 | 74 | 143
Other non-current assets | O | 15 | 38 | 34
Non-current assets |  |  | 15,120 | 14,517
Inventories | O | 16 | 1,810 | 1,478
Tax receivables | T |  | 11 | 17
Operative receivables | O | 17 | 1,473 | 1,449
Interest-bearing receivables | I | 26 | 77 | 84
Cash and cash equivalents | I |  | 1,917 | 1,481
Current assets |  |  | 5,287 | 4,509
Assets held for sale |  | 4 | 514 | 0
Total assets |  |  | 20,922 | 19,026

|  |  | As at 31 December
EUR million |  | Note | 2022 | 2021
Equity and liabilities |  |  |  |
Share capital |  | 18 | 1,342 | 1,342
Share premium |  |  | 77 | 77
Invested non-restricted equity fund |  |  | 633 | 633
Fair value reserve |  |  | 3,002 | 2,175
Cumulative translation adjustment |  | 28 | -415 | -195
Retained earnings |  |  | 7,893 | 6,650
Equity attributable to owners of the Parent |  |  | 12,532 | 10,683
Non-controlling Interests |  | 19 | -30 | -16
Total equity |  |  | 12,502 | 10,666
Post-employment benefit obligations | O | 20 | 159 | 347
Provisions | O | 22 | 81 | 91
Deferred tax liabilities | T | 9 | 1,443 | 1,430
Non-current interest-bearing liabilities | I | 26 | 2,792 | 3,313
Non-current operative liabilities | O | 23 | 11 | 13
Non-current liabilities |  |  | 4,486 | 5,195
Current portion of non-current debt | I | 26 | 667 | 180
Interest-bearing liabilities | I | 26 | 513 | 444
Bank overdrafts | I | 26 | 0 | 1
Provisions | O | 22 | 43 | 139
Operative liabilities | O | 23 | 2,410 | 2,339
Tax liabilities | T | 9 | 64 | 61
Current liabilities |  |  | 3,697 | 3,165
Liabilities related to assets held for sale |  | 4 | 237 | 0
Total liabilities |  |  | 8,419 | 8,360
Total equity and liabilities |  |  | 20,922 | 19,026
Items designated "O" comprise Operating Capital, items designated "I" comprise Interest-bearing Net Liabilities, items designated "T" comprise Net Tax Liabilities. The accompanying Notes are an integral part of these consolidated financial statements.

28
Consolidated cash flow statement

|  | Year ended 31 December
EUR million | Note | 2022 | 2021
Cash flow from operating activities |  |  |
Net profit for the year |  | 1,536 | 1,268
Adjustments and reversal of non-cash items: |  |  |
Taxes | 9 | 322 | 151
Depreciation and impairment charges | 10 | 635 | 697
Change in value of biological assets | 12 | -195 | -328
Change in fair value of share awards |  | 7 | 3
Share of results of equity accounted investments | 13 | -221 | -143
CTA and profits and losses on sale of fixed assets and investments 1 | 5 | 52 | -54
Net financial items | 8 | 151 | 149
Other adjustments |  | 22 | 17
Dividends received from equity accounted investments | 13 | 25 | 16
Interest received |  | 13 | 2
Interest paid |  | -119 | -123
Other financial items, net |  | -7 | -19
Income taxes paid | 9 | -178 | -136
Change in net working capital, net of businesses acquired or sold |  | -461 | -25
Net cash provided by operating activities |  | 1,582 | 1,476
Cash flow from investing activities |  |  |
Acquisition of shares in equity accounted investments | 13 | -7 | -6
Acquisition of unlisted securities | 14 | -11 | -1
Cash flow on disposal of subsidiary shares and business operations, net of disposed cash | 4 | -77 | 55
Cash flow on disposal of shares in equity accounted investments | 13 | 10 | 47
Cash flow on disposal of intangible assets and property, plant and equipment | 11 | 17 | 105
Capital expenditure | 3, 11 | -603 | -565
Investment in biological assets | 12 | -101 | -79
Proceeds from/payment of non-current receivables, net |  | 31 | -4
Net cash used in investing activities |  | -742 | -449

|  | Year ended 31 December
EUR million | Note | 2022 | 2021
Cash flow from financing activities |  |  |
Proceeds from issue of new long-term debt | 26 | 366 | 19
Repayment of long-term debt and lease liabilities | 26 | -390 | -940
Change in short-term interest-bearing liabilities | 26 | 9 | -59
Dividends paid |  | -434 | -237
Purchase of own shares |  | -1 | -3
Net cash used in financing activities |  | -450 | -1,220
Net change in cash and cash equivalents |  | 389 | -193
Translation adjustment |  | 48 | 18
Net cash and cash equivalents at beginning of year |  | 1,480 | 1,655
Net cash and cash equivalents at year end |  | 1,917 | 1,480
Cash and cash equivalents at year end 2 |  | 1,917 | 1,481
Bank overdrafts at year end |  | 0 | -1
Net cash and cash equivalents at year end |  | 1,917 | 1,480
1 CTA = Cumulative Translation Adjustment 2 Cash and cash equivalents comprise cash-in-hand, deposits held at call with banks and other liquid investments with original maturity of less than three months. Bank overdrafts are included in current liabilities. The accompanying Notes are an integral part of these consolidated financial statements.

29
Consolidated cash flow statement
Supplemental cash flow information

|  | Year ended 31 December
EUR million | Note | 2022 | 2021
Change in net working capital consists of: |  |  |
Change in inventories |  | -454 | -196
Change in interest-free receivables: |  |  |
Current |  | -165 | -305
Non-current |  | -1 | -7
Change in interest-free liabilities: |  |  |
Current |  | 163 | 491
Non-current |  | -3 | -7
Change in net working capital, net of businesses acquired or sold |  | -461 | -25
Cash and cash equivalents consist of: |  |  |
Cash on hand and at banks |  | 1,272 | 946
Cash equivalents |  | 646 | 535
Cash and cash equivalents |  | 1,917 | 1,481
Non-cash investing activities |  |  |
Total capital expenditure excluding right-of-use assets |  | 656 | 576
Amounts paid |  | -603 | -565
Non-cash part of additions to intangible assets and property, plant and equipment |  | 53 | 11
Cash flow on disposals of subsidiaries and business operations |  |  |
Cash part of the consideration | 4 | 13 | 67
Cash and cash equivalents in divested companies | 4 | -90 | -12
Net cash flow from disposal |  | -77 | 55
The accompanying Notes are an integral part of these consolidated financial statements.

30
Statement of changes in equity

|  |  |  |  | Fair value reserve |  |  |  |  |
EUR million | Share capital | Share premium and reserve fund | Invested non- restricted equity fund | Treasury shares | Equity instruments through OCI | Cash flow hedges | Revaluation reserve | OCI of Equity Accounted Investments | CTA and net investment hedges and loans | Retained earnings | Attributable to owners of the parent | Non- controlling interests | Total
Balance at 1 January 2021 | 1,342 | 77 | 633 | — | 277 | 23 | 1,195 | 12 | -267 | 5,518 | 8,809 | -16 | 8,793
Net profit for the year | — | — | — | — | — | — | — | — | — | 1,266 | 1,266 | 3 | 1,268
OCI before tax | — | — | — | — | 501 | -35 | 225 | 16 | 70 | 126 | 903 | -3 | 900
Income tax relating to OCI | — | — | — | — | 1 | 8 | -46 | — | 2 | -22 | -59 | — | -59
Total Comprehensive Income | — | — | — | — | 501 | -27 | 179 | 16 | 72 | 1,369 | 2,110 | — | 2,110
Dividend | — | — | — | — | — | — | — | — | — | -237 | -237 | — | -237
Acquisitions and disposals | — | — | — | — | — | — | — | — | — | — | — | — | —
Purchase of treasury shares | — | — | — | -3 | — | — | — | — | — | — | -3 | — | -3
Share-based payments | — | — | — | 3 | — | — | — | — | — | — | 3 | — | 3
Balance at 31 December 2021 | 1,342 | 77 | 633 | — | 778 | -4 | 1,373 | 29 | -195 | 6,650 | 10,683 | -16 | 10,666
Net profit for the year | — | — | — | — | — | — | — | — | — | 1,550 | 1,550 | -13 | 1,536
OCI before tax | — | — | — | — | 519 | 52 | 259 | 58 | -224 | 147 | 812 | — | 812
Income tax relating to OCI | — | — | — | — | 1 | -9 | -53 | — | 3 | -25 | -83 | — | -83
Total Comprehensive Income | — | — | — | — | 520 | 43 | 206 | 58 | -220 | 1,672 | 2,278 | -13 | 2,265
Dividend | — | — | — | — | — | — | — | — | — | -434 | -434 | — | -434
Acquisitions and disposals | — | — | — | — | — | — | — | — | — | — | — | — | —
Purchase of treasury shares | — | — | — | -1 | — | — | — | — | — | — | -1 | — | -1
Share-based payments | — | — | — | 1 | — | — | — | — | — | 5 | 6 | — | 6
Balance at 31 December 2022 | 1,342 | 77 | 633 | — | 1,298 | 39 | 1,579 | 87 | -415 | 7,893 | 12,532 | -30 | 12,502
CTA = Cumulative Translation Adjustment, NCI = Non-controlling Interests, OCI = Other Comprehensive Income, EAI = Equity Accounted Investments

31
Notes to the consolidated financial statements
Note 1 Accounting principles
Principal activities
Stora Enso Oyj (“the Company”) is a Finnish
public limited liability company organised
under the laws of the Republic of Finland
and with its registered address at
Salmisaarenaukio 2, 00180 Helsink i. Its
shares are currently listed on Nasdaq
Helsinki and Stockholm. The operations of
Stora Enso Oyj and its subsidiaries (together
“Stora Enso” or “the Group”) are organised
into the following reportable segments:
Packaging Materials, Packaging Solutions,
Biomaterials, Wood Products, Forest, Paper
and segment Other. The Group’s main
market is Europe.
The Financial Statements were
authorised for issue by the Board of
Directors on 30 January 2023.
Basis of preparation
The consolidated financial statements of
Stora Enso Oyj have been prepared in
accordance with International Financial
Reporting Standards (IFRS), as adopted by
the European Union, including International
Accounting Standards (IAS) and
interpretations issued by the IFRS
Interpretations Committee (IFRIC). The
consolidated financial statements of Stora
Enso Oyj have been prepared according to
the historical cost convention, except as
disclosed in the accounting policies. The
detailed accounting principles are explained
in the related notes with a few exceptions
where the accounting principles are
presented in this note. The consolidated
financial statements are presented in euros,
which is the parent company’s functional
currency.
All figures in this Annual Report have
been rounded to the nearest million, unless
otherwise stated. Therefore, figures in this
report may not add up precisely to the totals
presented and may vary from previously
published financial information.
New and amended standards and
interpretations adopted in 2022
The Group has applied the following new
and amended standards and interpretations
which are effective from 1 January 2022:
•Amendments to IFRS 3 Business
Combinations, IAS 16 Property, Plant and
Equipment, IAS 37 Provisions, Contingent
Liabilities and Contingent Assets and
Annual Improvements 2018-2020. The
amendments in IFRS 3 relate to
identifying the liabilities assumed in a
business combination and that an
acquirer does not recognise contingent
assets acquired in a business
combination. The amendment in IAS 16
prohibits deducting from the cost of a
fixed asset any proceeds from selling
items produced while bringing that asset
in use. Instead, proceeds from selling
such items and the cost of producing
those items are recognised in profit or
loss. The amendments in IAS 37 specify
that the cost of fulfilling a contract
includes the costs that relate directly to
the contract (examples include direct
labour, materials, and allocation of the
depreciation for an asset used in fulfilling
the contract). Annual Improvements to
IFRS Standards 2018–2020 include minor
amendments in IFRS 9 Financial
Instruments, IFRS 16 Leases and IAS 41
Agriculture. The effective date is 1
January 2022. The amendments did not
have a significant impact on the Group.
•Amendments to IFRS 16 Leases:
COVID-19 Related Rent Concessions.
The amendments extend the availability
of the practical expedient and provide
lessees with an exemption from
assessing whether a COVID-19-related
rent concession is a lease modification.
The effective date is annual reporting
periods beginning on or after 1 April 2021.
The amendments did not have a
significant impact on the Group.
•Other standards standard amendment s
and interpretations did not have any
significant impact on the Group's
consolidated financial statements or
disclosures.
Changes in accounting principles
Valuation of Finnish forest assets
Stora Enso changed the valuation method
for its forest assets in Finland at the end of
2022 to correspond to the valuation method
applied with Swedish forest assets. Forest
assets in Finland are owned through Group's
41% shareholding in equity accounted
investment Tornator. Forest assets are
defined as biological assets (standing
growing trees) and the related forest land. As
a result of the valuation method change, the
forest assets in Finland are valued using a
market approach.
Forest assets in Finland are valued by
using a market approach method based on
the forest market transactions in those areas
where Stora Enso’s forests are located. In
Finland reliable market transaction data is
considered to be available and also
considered to provide a more transparent
and observable valuation basis. The total
forest assets net cash flows consist of cash
flows related to standing trees (biological
assets) and separate cash flows regarding
forest land. The standing trees valuation is
computed based on a discounted cash flow
(DCF) method and using a discount rate
implied by the market transactions in
accordance with the IAS 41 Agriculture
standard. The discount rate is determined as
the rate at which the market transaction
prices match the total forest assets cash
flows. The discount rate is the same for
biological assets and forest land.
Previously, the discounted cash flow
method was used for valuation of biological
assets and forest land, where the discount
rate applied was determined using the
weighted average cost of capital method.
There are no changes in applied accounting
principles and the change in the valuation
method concerns only forest assets in
Finland, while there are no changes in the
valuation method with Tornator's minor forest
holdings in Estonia and Romania.
Changes in the valuation method with
Finnish forest assets increased Stora Enso's
share of the carryin g amount of forest assets
by approximately EUR 240 million, divided
between an increase in biological assets of
EUR 170 million and an increase in forest
land of EUR 70 million. Net of taxes, the
change resulted in about EUR 190 million
increase in investments in equity accounted
investments.
The increase in forest land assets is
recognised in the OCI net of deferred taxes
and does not have an impact on the income
statement. The fair value changes in
biological assets is recognised in the income
statement. The comparative periods have
not been restated. See Note 12 Forest
assets for more details.
Accounting considerations relating
to Russia
As announced in March 2022, all import and
export activities from and to Russia were
halted, and operations in Russia were
stopped. In May and July 2022, Stora Enso
sold all of its operations in Russia. Related to
one forest operations unit, the disposal will
be completed in 2023, upon finalisation of
certain formalities. More details about
disposed Packaging Solutions, Wood
Products and Forest operations are
presented in Note 4 Acquisitions disposals
32
and assets held for sale. More information
about valuation of remaining Russia related
receivables see Note 26 Interest-bearing
assets and liabilities.
Consolidation principles
The consolidated financial statements
include the parent company, Stora Enso Oyj,
and all companies controlled by the Group.
Control is defined as when the Group:
•has power over the investee,
•is exposed, or has rights, to variable
returns from its involvement with the
investee; and
•has the ability to use its power to affect its
returns.
If facts and circumstances indicate that there
are changes to the three elements of control
listed above the Group reassess whether or
not it controls an investee. Acquired
companies are accounted for under the
acquisition method whereby they are
included in the consolidated financial
statements from the date the control over the
subsidiary is obtained, whereas, conversely,
disposed companies are included up to the
date when the control is lost. The
subsidiaries and joint operations are listed in
Note 30 Group companies.
All intercompany transactions,
receivables, liabilities and unrealised profits,
as well as intragroup profit distributions, are
eliminated. Accounting policies for
subsidiaries, joint arrangements and equity
accounted investments are adjusted where
necessary to ensure consistency with the
policies adopted by Stora Enso.
Associated companies over which Stora
Enso exercises significant influence are
accounted for by using the equity method.
These companies are investments in which
the Group has significant influence, but
which it does not control. Significant
influence means the power to participate in
the financial and operating policy decisions
of the company without control or joint
control over those policies. More detailed
information is presented in Note 13 Equity
accounted investments.
Joint control is the contractually agreed
sharing of control of the joint arrangement,
which exists only when decisions on relevant
activities require the unanimous consent of
the parties sharing control. Joint operations
are joint arrangements, whereby the partners
who have joint control of the arrangement
have rights to the assets, and obligations for
the liabilities, relating to the arrangement.
Joint ventures are joint arrangements,
whereby the partners who have joint control
of the arrangement have rights to the net
assets of the joint arrangement.
The Group has two joint o perations,
Veracel and Montes del Plata. In both
companies, Stora Enso’s ownership is 50%.
The arrangements are based on
shareholders’ agreements, which give Stora
Enso rights to a share of returns and make
the Group indirectly liable for the liabilities,
as its ability to pay for the pulp is used to
finance debts. In relation to its interest in joint
operations, the Group recognises its share of
assets, liabilities, revenues, expenses and
cash flows of the joint operation. The share is
determined based on rights to the assets and
obligations for the liabilities of each joint
operator.
•Veracel is a jointly owned company of
Stora Enso and Suzano located in Brazil.
The pulp mill produces 1.2 million tonnes
of bleached eucalyptus hard wood pulp
per year and both owners are entitled to
half of the mill’s output. The eucalyptus is
sourced mostly from the company’s own
forestry plantations. The mill commenced
production in May 2005.
•Montes del Plata is a jointly owned
company of Stora Enso and Arauco
located in Uruguay. The Montes del Plata
Pulp Mill’s annual capacity is 1.4 million
tonnes of bleached eucalyptus hard wood
pulp and Stora Enso’s part, 0.7 million
tonnes, is sold entirely as market pulp.
The eucalyptus is sourced mostly from
the company’s own forestry plantations.
The mill commenced production in June
2014.
Revenue recognition
Sales comprise products, raw materials and
services less indirect sales tax and
discounts, and are adjusted for cash flow
hedging result on sales in foreign currencies.
Sales are recognised after Stora Enso has
transferred the control of goods and services
to a customer and the Group retains neither
a continuing right to dispose of the goods,
nor effective control of those goods; usually,
this means that sales are recorded upon the
delivery of goods to customers in
accordance with the agreed terms of
delivery.
Stora Enso’s terms of delivery are based
on Incoterms 2020, which are the official
rules for the interpretation of trade terms as
issued by the International Chamber of
Commerce (ICC). The main categories of the
terms covering Group sales are:
•“D” terms, under which the group is
obliged to deliver the goods to the buyer
at the agreed place in the manner
specified in the chosen rule, in which case
the Point of Sale is the moment of
delivery to the buyer.
•“C” terms, whereby the Group arranges
and pays for the external carriage and
certain other costs, though the Group
ceases to be responsible for the goods
once they have been handed over to the
carrier in accordance with the relevant
term. The Point of Sale is thus the
handing over of the goods to the carrier
contracted by the seller for the carriage to
the agreed destination.
•“F” terms, being where the buyer
arranges and pays for the carriage, thus
the Point of Sale is the handing over of
the goods to the carrier contracted by the
buyer at the agreed point.
Where local rules may result in invoices
being raised in advance of the above, the
effect of this revenue advancement is
quantified, and an adjustment is made
accordingly.Stora Enso’s sales mainly
comprise sales of products and the revenue
is typically recognised at a point in time when
Stora Enso transfers control of these
products to a customer. Revenues from
services are recognised over time once the
service has been performed. More detailed
information regarding Stora Enso's principal
activities from which the Group generates its
revenue and disaggregation of revenue is
presented in Note 3 Segment information.
Foreign currency transactions
Transactions in foreign currencies are
recorded at the rate of exchange prevailing
at the transaction date, but at the end of the
month foreign-currency-denominated
receivables and liabilities are translated
using the month-end exchange rate. Foreign
exchange differences for operating items are
presented in the appropriate income
statement line in the operating profit, and, for
financial assets and liabilities, they are
presented in the financial items in the
consolidated income statement, except when
deferred in equity as qualifying cash flow
hedges, net investment hedges or net
investment loans. Translation differences on
non-monetary financial assets, such as
equities classified at fair value through other
comprehensive income (FVTOCI), are
included in equity.
Foreign currency translations
The income statements of Group companies
with functional and presentational currencies
other than the euro are translated into the
Group reporting currency using the average
exchange rates of the year, whereas the
statements of the financial position of these
companies are translated using the
exchange rates at the reporting date. The
Group is exposed to currency risks arising
from exchange rate fluctuations on the value
of its net investment in non-euro area foreign
entities. Exchange differences arising from
the retranslation of net investments in foreign
entities that are non-euro foreign
subsidiaries, joint operations or equity
33
accounted investments, and of financial
instruments that are designated to hedge
such investments, are recorded directly in
equity as cumulative translation adjustment
(CTA). See Note 28 Cumulative translation
adjustments and equity hedging for more
details.
Future standard changes endorsed
by the EU but not yet effective in
2022
•Amendments to IAS 1 Presentation of
Financial Statements: Disclosure of
Accounting policies. The amendment
requires entities to disclose their material
accounting policy information rather than
their significant accounting policies. The
effective date is 1 January 2023. The
Group will consider the amendment in
disclosures and expects that the impact
will not be significant.
•Amendments to IAS 8 Accounting
policies, Changes in Accounting
Estimates and Errors: Definition of
Accounting Estimates. The amendments
introduce the definition of accounting
estimates and includes other
amendments to IAS 8 to help entities
distinguish changes in accounting
estimates from changes in accounting
policies. The effective date is 1 January
2023. The Group expects that the
amendment does not have a significant
impact.
•Amendments to IAS 12 Income Taxes:
Deferred Tax related to Assets and
Liabilities arising from a Single
Transaction. The amendments clarify how
entities account for deferred tax on
transactions such as leases and
decommissioning obligations. The main
change is related to the initial recognition
exemption and in accordance with the
amendment; the initial recognition
exemption does not apply to transactions
in which equal amounts of deductible and
taxable temporary differences arise on
initial recognition. The effective date is 1
January 2023. The Group expects that
the amendment does not have a
significant impact.
•No other published standards, standard
amendments or interpretations which
would be expected to have any significant
impact on the Group’s consolidated
financial statements or disclosures.
Future standard changes not yet
effective and not yet endorsed by the
EU in 2022
•Amendments to IFRS 16 Leases: Lease
Liability in Sale and Leaseback.
Amendment requires a seller-lessee to
subsequently measure lease liabilities
arising from a leaseback in a way that it
does not recognise any amount of the
gain or loss that relates to the right of use
it retains. The new requirements do not
prevent a seller-lessee from recognising
in profit or loss any gain or loss relating to
the partial or full termination of a lease.
The effective date is 1 January 2024. The
Group is evaluating the impact of the
amendments.
•Amendments to IAS 1 Presentation of
Financial Statements: Information about
long-term debt with covenants. IAS 1
requires a company to classify debt as
non-current only if the company can avoid
settling the debt in the 12 months after the
reporting date. However, a company’s
ability to do so is often subject to
complying with covenants. The
amendments specify that covenants to be
complied with after the reporting date do
not affect the classification of debt as
current or non-current at the reporting
date. Instead, the amendments require a
company to disclose information about
these covenants in the notes to the
financial statements. The effective date is
1 January 2024. The Group is evaluating
the impact of the amendments and
expects that the amendment does not
have significant impact.
•Amendments to IAS 1 Presentation of
Financial Statements: Classification of
liabilities as current or non-current. The
amendments clarify a criterion for
classifying a liability as non-current. The
amendments specify that an entity’s right
to defer settlement must exist at the end
of the reporting period; clarify that
classification is unaffected by
management’s intentions or expectations
about whether the entity will exercise its
right to defer settlement; clarify how
lending conditions affect classification;
and clarify requirements for classifying
liabilities an entity will or may settle by
issuing its own equity instruments. The
effective date is 1 January 2024. The
Group is evaluating the impact of the
amendments and expects that the
amendment does not have significant
impact.
•Other published standards, standard
amendments or interpretations are not
expected to have any significant on the
Group’s consolidated financial statements
or disclosures.
Note 2 Critical accounting
estimates and judgements
T he preparation of consolidated financial
statements in accordance with IFRS requires
management to make estimates, judgements
and assumptions that affect the reported
assets and liabilities, as well as the
disclosure of contingent assets and liabilities
at the reporting date and the reported
revenues and expenses during the period.
These estimates, judgments and
assumptions might have a significant impact
on the amounts recognised in the
consolidated financial statements. The
estimates are based on historical experience
and various other assumptions that are
believed to be reasonable and reflect
management's best estimates, though actual
results and timings could differ from these.
The estimates, judgements and assumptions
are reviewed regularly and updated if there
are changes in circumstances or as a result
of new information. The accounting items
presented below represent those matters
which include the most estimation
uncertainty and exercise of judgement.
Property, plant and equipment,
intangible assets and right-of-use
assets
The carrying amounts of property, plant and
equipment and intangible assets and right-of-
use assets are assessed at each reporting
date to determine whether there is any
indication that an asset may be impaired. If
an indicator of impairment exists, the asset's
recoverable amount is determined and
compared with its carrying amount. The
recoverable amount of an asset is estimated
as the higher of fair value less the cost of
disposal and the value in use, and an
impairment charge is recognised whenever
the carrying amount exceeds the recoverable
amount. The value in use is calculated using
a discounted cash flow method which is most
sensitive to the discount rate as well as the
expected future cash flows. The key
assumptions used in the impairment testing,
are explained further in Note 10
Depreciation, amortisation and impairment
charges.
Management believes that the assigned
values and useful lives, as well as the
underlying assumptions, are reasonable,
though different assumptions and assigned
useful lives could have a significant impact
on the reported amounts. For material
intangible assets and property, plant and
equipment in an acquisition, an external
advisor makes a fair valuation of the
acquired intangible assets and property,
plant and equipment and assists in
determining their remaining useful life.
Goodwill
Goodwill is tested per Cash Generating Unit
(CGU) or by a group of CGUs at least on an
annual basis and recoverable amount is
calculated using the discounted cash flow
method (value in use). Impairment is
recognised if the carrying amount exceeds
the recoverable amount. The discounted
34
cash flow method uses future projections of
cash flows from each of the reporting units in
a CGU or a group of CGUs and includes,
among other estimates, projections of future
product pricing, production levels, product
costs, market supply and demand, projected
capital expenditures and an assumption of
the weighted average cost of capital. The
discount rates used reflect the best estimate
of the weighted average cost of capital.
The Group has evaluated the most
sensitive estimates and assumptions, which,
when changed, could have a material impact
on the valuation of the assets including
goodwill and, therefore, could lead to an
impairment. These estimates and
assumptions are expected sales prices,
expected operating costs and the discount
rate. The key assumptions used in the
impairment testing are presented in Note 10
Depreciation, amortisation and impairment
charges.
Leases
When assessing the lease term and if an
extension or renewal options are included or
not, the Group considers all relevant facts,
circumstances and incentives that might
have an impact on the assessment. Options
to extend or renew the lease are included in
the lease term only if it is reasonably certain
that Stora Enso will exercise the option. The
Group will do a reassessment, for example
upon changes in circumstances, receiving
new information or an occurrence of a
significant event that is within the control of
the lessee and might have an impact on the
assessment. See Note 11 Intangible assets,
property, plant and equipment and right-of-
use assets for more details about right-of-
use assets and Note 26 Interest-bearing
assets and liabilities for more details about
lease liabilities.
Biological assets
The Group has biological assets in
subsidiaries, joint operations and associated
company. Biological assets, in the form of
standing trees, are accounted in accordance
with the IAS 41 Agriculture standard, which
requires that the assets are measured at fair
value less the costs to sell. Fair value is
determined by using discounted cash flows
from continuous operations based on
sustainable forest management plans taking
into account the growth potential of one
cycle. These discounted cash flows require
estimates of growth, harvesting, sales price,
costs and discount rate. In determining the
value of biological assets, the management
needs to make estimates of future price
levels and trends for sales and costs, and to
undertake regular surveys of the forest to
establish the volumes of wood available for
harvesting and their current growth rates.
See next chapter for estimates and
judgement applied in valuation of Nordic
forest assets and Note 12 Forest assets for
more detailed information about Nordic and
plantation forest assets.
Nordic forest assets
The fair value of forest assets in the Nordics
is determined using a market approach
method, which is based on the forest market
transactions in the areas where Stora Enso’s
forests are located. Market prices between
areas vary significantly and judgement is
applied to define relevant areas for market
transactions used in valuation. The valuation
of the forest assets is based on detailed
transaction data and price statistics as
provided by market data suppliers. Market
transaction data is adjusted to consider
characteristics and nature of Stora Enso's
forest assets and to exclude certain non-
forest assets and transactions considered as
outliers compared to other transactions. The
valuation takes into account where the forest
land is located, price levels and volume of
standing stock. The value of the forest
assets will be affected by changes in
transaction prices and by how the volume of
standing stock develops. Stora Enso is
applying weighted three-year average
market transaction prices and this is
considered to include a sufficient amount of
transactions and estimated to represent
market conditions at the reporting date.
The value of the forest assets is allocated
to biological assets and forest land.
Allocation of the combined fair value of forest
assets is based on the income approach
where separate present values of expected
net cash flows are calculated for both
biological assets and forest land. The
discount rate is determined as the rate at
which the valuation based on market
transaction prices matches the total forest
assets combined cash flows for biological
assets and forest land. The total net cash
flows for each of the components include
estimates in respect of future harvesting
volumes, sales price levels, and cost
development. See Note 12 Forest assets for
more information.
Fair value of financial instruments
Where the fair value of financial assets and
liabilities cannot be derived directly from
publicly quoted market prices, other
valuation techniques, such as discounted
cash flow models, transaction multiples, the
Black and Scholes model and the Gordon
model, are applied. The key judgements
include future cash flows, credit risk, volatility
and changes in assumptions about these
factors which could affect the reported fair
value of the financial instruments.
Investments in debt and equity instruments
of unlisted entities, such as Pohjolan Voima
Oy (PVO), represent a significant portion of
the Group’s assets and require management
judgement, as explained in more detail in
Notes 14 Equity instruments and 24
Financial risk management.
Income taxes
Tax assets and liabilities are reviewed on a
regular basis and balances are adjusted
appropriately. The deferred tax assets,
whether arising from temporary differences
or from tax losses, are recognised only to the
extent that it is probable that future taxable
profits will be available against which the
assets can be utilised. Management
considers that adequate provision has been
made for future tax consequences based on
the current facts, circumstances and tax
laws. However, should any tax positions be
challenged and not prevail, different
outcomes could result and have a significant
impact on the amounts reported in the
consolidated financial statements. See Note
9 Income taxes for more detailed
information.
Post-retirement benefits
The determination of the Group pension
obligation and expense is subject to the
selection of certain assumptions used by
actuaries in calculating such amounts,
including, among others, the discount rate,
the annual rate of increase in future
compensation levels and estimated
lifespans. Amounts charged in the income
statement are determined by independent
actuaries; however, where actual results
differ from the initial estimates, together with
the effect of any change in assumptions or
other factors, these differences are
recognised directly in equity, as disclosed in
the statement of comprehensive income.
See Note 20 Post-employment benefit
obligations for detailed information on the
assumptions used in the pension obligation
calculations.
Provisions
The Group has recognised provisions for
known environmental, restructuring and
other obligations, where legal or constructive
obligation exist as a result of past events.
The amounts recognised as provisions are
based on the management’s best estimate of
the costs required to settle the obligation.
Due to uncertainty regarding the timing and
amount of these costs, the actual costs might
differ significantly from the original estimate.
The carrying amounts of provisions are
reviewed regularly and adjusted when
needed to consider changes in cost
estimates, regulations, applied technologies
and conditions. See Note 22 Provisions for
more detailed information.
35
Note 3 Segment information
Accounting principles
Stora Enso’s reportable segments are Packaging Materials, Packaging Solutions, Biomaterials,
Wood Products, Forest, and Paper and the segment Other. Operating segments reflect the
Group’s management structure and the way financial information is regularly reviewed by Stora
Enso’s President and CEO who is responsible for allocating resources and assessing the
performance of the operating segments. Costs, revenues, assets and liabilities are allocated to
business segments on a consistent basis. Transactions between operating segments are based
on arm’s length terms, and they are eliminated on consolidation. The activities of the reportable
segments are:
Packaging Materials
The Packaging Materials division is a global leader and expert in circular packaging providing
premium packaging materials based on virgin and recycled fiber. Addressing the needs of
today’s eco-conscious consumers, Stora Enso helps customers replace fossil-based materials
with low-carbon, renewable and recyclable alternatives for their food, beverage and transport
packaging. A wide selection of base boards and barrier coatings enables design optimisation for
various demanding packaging end-uses.
Packaging Solutions
The Packaging Solutions division develops and sells premium fiber-based packaging products
and services. Stora Enso’s high-end eco-friendly packaging products are used by leading brands
across multiple market sectors, including the retail, e-commerce and industrial sectors. The
portfolio includes converting corrugated board and carton board, and other new materials such
as formed fiber and wood foams into standard and bespoke packaging solutions. The division
also provides design and sustainability services for our customers, as we support a shift towards
circular solutions.
Biomaterials
The Biomaterials division meets the growing demand for bio-based solutions which replace
fossil-based and non-renewable materials. Stora Enso achieves this by using all fractions of
biomass, like lignin, to develop new solutions including novel applications such as bio-based
anode material for batteries and bio-based binders. Our pulp offering encompasses a wide
variety of grades to meet the demands of packaging, paper, tissue, specialities, and hygiene
product producers. We also serve the biochemicals market with tall oil and turpentine from
biomass for further refining. Pulp continues to be our foundation while long-term growth is driven
by new products and innovations.
Wood Products
The Wood Products division is the largest sawn wood producer in Europe and a leading provider
of sustainable wood-based solutions for the global construction industry. The growing Building
Solutions business offers building concepts and a full range of products to support low-carbon
construction. Stora Enso develops services and digital tools to simplify the design and
construction of buildings with wood. Additionally, we offer applications for windows and doors,
and pellets for sustainable heating solutions.
Forest
The Forest division creates customer value through innovative solutions, competitive wood
supply and sustainable forest management. Forests are the foundation for Stora Enso’s
renewable offerings. The division manages Stora Enso’s forest assets in Sweden and a 41%
share of Tornator, whose forest assets are mainly located in Finland. It is also responsible for
wood sourcing for Stora Enso’s Nordic and Baltic operations and B2B customers. Stora Enso is
one of the biggest private forest owners in the world.
Paper
At the end of 2022, Stora Enso had an established customer base and its product portfolio had
offerings for print and office use. Customers benefit from Stora Enso’s selection of paper grades
made from recycled and virgin fiber, our technical and operational expertise and sustainability
know-how, and our sales and customer service centre network.
Segment Other
The segment Other includes Stora Enso’s shareholding in the energy company Pohjolan Voima
(PVO), and the Group’s shared services and administration.
Read more about the changes in segment reporting in 2023 in the Note 33 (Events after the
reporting period).
Sales by segment

| External | Internal | Total | External | Internal | Total
EUR million | 2022 | 2021
Packaging Materials | 4,473 | 218 | 4,690 | 3,715 | 183 | 3,898
Packaging Solutions | 714 | 23 | 737 | 704 | 19 | 723
Biomaterials | 1,798 | 382 | 2,180 | 1,499 | 229 | 1,728
Wood Products | 2,058 | 137 | 2,195 | 1,766 | 106 | 1,872
Forest | 848 | 1,671 | 2,519 | 781 | 1,530 | 2,311
Paper | 1,691 | 81 | 1,772 | 1,644 | 59 | 1,703
Other | 97 | 1,000 | 1,097 | 55 | 1,037 | 1,092
Elimination of internal sales |  | -3,512 | -3,512 |  | -3,163 | -3,163
Total | 11,680 | 0 | 11,680 | 10,164 | 0 | 10,164

Disaggregation of revenue

EUR million | 2022 | 2021
Product sales | 11,521 | 10,047
Service sales | 159 | 117
Total | 11,680 | 10,164

36
Segment share of operating profit/loss

| Year Ended 31 December
| Operating Profit/Loss
EUR million | 2022 | 2021
Packaging Materials | 595 | 552
Packaging Solutions | -101 | 23
Biomaterials | 668 | 506
Wood Products | 253 | 363
Forest | 523 | 622
Paper | 172 | -423
Other | -59 | -67
Eliminations | -41 | -8
Total | 2,009 | 1,568
Net financial items | -151 | -149
Profit before Tax | 1,858 | 1,419
Income tax expense | -322 | -151
Net Profit | 1,536 | 1,268

Operating capital, depreciation, impairments and impairment reversals, disposal gains
and losses, and capital expenditure by segm ent

| Year Ended 31 December
| Operating capital | Depreciation/ impairments/ impairment reversals/ disposal gains and losses | Capital expenditure 1
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Packaging Materials | 3,344 | 3,206 | 253 | 255 | 342 | 330
Packaging Solutions | 235 | 245 | 66 | 32 | 46 | 34
Biomaterials | 2,796 | 2,520 | 110 | 99 | 121 | 88
Wood Products | 718 | 678 | 59 | 46 | 87 | 66
Forest | 6,963 | 6,696 | 50 | 20 | 35 | 25
Paper | 333 | 123 | 88 | 207 | 60 | 55
Other | 1,477 | 860 | 9 | 37 | 10 | 11
Eliminations | -61 | -21 | 0 | 0 | 0 | 0
Total | 15,806 | 14,307 | 635 | 697 | 701 | 609
1 Excluding biological asset capex Operating capital (“O” items) is designated thus in the balance sheet and represents the sum of intangible asset and property, plant and equipment, right-of-use assets, forest assets, emission rights, unlisted shares, other non-current assets, inventories, current operative receivables and liabilities, provisions and other non-current operative liabilities. Operating capital includes assets held for sale and liabilities related to assets held for sale.

Goodwill by segment

| Year Ended 31 December
| Goodwill 1
EUR million | 2022 | 2021
Packaging Materials | 24 | 25
Packaging Solutions | 6 | 6
Biomaterials | 45 | 45
Wood Products | 117 | 116
Forest | 0 | 0
Paper | 51 | 90
Other | 0 | 0
Total | 244 | 282
1 Goodwill excluding assets held for sale |  |

See Note 10 Depreciation, amortisation and impairment charges for more details related to
recognised impairments and impairment testing.
Average personnel

| Year Ended 31 December
Segment | 2022 | 2021
Packaging Materials | 6,274 | 5,801
Packaging Solutions | 3,966 | 4,361
Biomaterials | 2,135 | 1,865
Wood Products | 4,445 | 4,177
Forest | 1,412 | 1,476
Paper | 2,298 | 3,292
Other | 1,261 | 2,098
Total | 21,790 | 23,071

| Year Ended 31 December
Location | 2022 | 2021
Austria | 1,067 | 1,028
Baltic States | 1,512 | 1,459
Belgium | 506 | 506
Czech Republic | 1,118 | 1,039
Finland | 5,666 | 6,003
Germany | 598 | 734
Poland | 1,994 | 1,976
Russia | 585 | 1,132
Sweden | 4,659 | 5,023
Other Europe | 230 | 236
Total Europe | 17,934 | 19,137
Brazil | 527 | 477
China (incl. Hong Kong) | 2,894 | 3,006
USA | 33 | 43
Uruguay | 313 | 310
Other countries | 89 | 98
Total | 21,790 | 23,071

| As at 31 December
| 2022 | 2021
Year-End Personnel | 20,879 | 22,094

37
External sales by destination

| Sales by Destination
EUR million | 2022 | 2021
Austria | 450 | 403
Baltic States | 377 | 315
Belgium | 117 | 102
Czech Republic | 231 | 188
Denmark | 128 | 108
Finland | 759 | 610
France | 449 | 357
Germany | 1,208 | 1,049
Italy | 650 | 450
Netherlands | 317 | 207
Poland | 733 | 548
Russia | 112 | 307
Spain | 311 | 246
Sweden | 1,071 | 975
UK | 444 | 395
Other Europe | 577 | 837
Total Europe | 7,934 | 7,096
Australia / New Zealand | 202 | 146
Brazil | 50 | 41
China (incl. Hong Kong) | 1,125 | 1,183
Japan | 417 | 316
Middle East | 275 | 252
Uruguay | 31 | 28
USA | 397 | 320
Other countries | 1,250 | 782
Total | 11,680 | 10,164

Reconciliation of operating capital to total assets

| As at 31 December
EUR million | 2022 | 2021
Operating capital | 15,806 | 14,307
Operative liabilities | 2,909 | 2,930
Interest-bearing receivables | 2,122 | 1,629
Tax receivables | 85 | 160
Total assets | 20,922 | 19,026

Operating capital, non-current assets and capital expenditure by location

| Year Ended 31 December
| Operating capital | Non-current assets 1 | Capital expenditure 2
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Austria | 125 | 107 | 128 | 120 | 16 | 8
Baltic States | 163 | 151 | 74 | 72 | 12 | 9
Belgium | 99 | 123 | 135 | 153 | 13 | 21
Czech Republic | 196 | 162 | 198 | 158 | 41 | 39
Finland | 4,543 | 3,358 | 2,729 | 2,382 | 311 | 296
Germany | 44 | -68 | 53 | 216 | 10 | 5
Poland | 413 | 406 | 379 | 378 | 35 | 36
Russia | -2 | 112 | 0 | 73 | 3 | 12
Sweden | 7,021 | 6,777 | 6,837 | 6,951 | 173 | 129
Other Europe | 66 | 92 | 11 | 6 | 8 | 1
Total Europe | 12,668 | 11,219 | 10,543 | 10,508 | 623 | 556
Brazil | 303 | 261 | 278 | 231 | 21 | 16
China (incl. Hong Kong) | 1,093 | 1,173 | 1,044 | 1,116 | 25 | 18
Uruguay | 1,722 | 1,636 | 1,580 | 1,514 | 31 | 18
USA | 41 | 47 | 32 | 30 | 0 | 0
Other countries | -22 | -29 | 4 | 6 | 1 | 1
Total | 15,806 | 14,307 | 13,481 | 13,405 | 701 | 609
1 Non-current assets excluding assets held for sale, financial instruments and deferred tax assets. 2 Excluding biological asset capex

38
Note 4 Acquisitions, disposals and assets held for sale
Accounting principles
Acquired companies are accounted in accordance with the acquisition method whereby these
companies are included in the consolidated financial statements from the date the control is
obtained. Accordingly, the consideration transferred (including contingent consideration) and the
acquired company's identifiable net assets are measured at fair value at the date of the
acquisition. Transaction costs related to acquisition are expensed as incurred. The
measurement type of non-controlling interest is decided separately for each acquisition, and
measured either at fair value or non-controlling interest's proportionate share of the net assets.
The excess of the consideration transferred, non-controlling interest and possible previously held
equity interest over the fair value of net assets of the acquired company is recognised as
goodwill, which is tested for impairment at least annually.
The disposed companies are included in the consolidated financial statements up to the date
when the control is lost. The gain or loss on disposal together with cumulative translation
adjustments (CTA) related to disposed companies are recognised in the consolidated income
statement at the date control is lost. Gains and losses on the disposal of a Group entity include
any goodwill relating to the entity sold.
Assets are classified as held for sale, if their carrying amounts will be recovered mainly
through a sale transaction rather than through continuing use. The assets must be available for
immediate sale in their present condition subject only to terms that are usual and customary for
sale of such assets. Also, the sale must be highly probable and expected to be completed within
one year from the date of classification. These assets and related liabilities are presented
separately in the consolidated statement of financial position and measured at the lower of the
carrying amount and fair value less costs to sell. Comparative information is not restated when
classification is made. Assets classified as held for sale are not depreciated.
Acquisition of Group companies
Stora Enso did not complete any company or business acquisitions in 2022 or 2021.
In September 2022, Stora Enso signed an agreement to acquire De Jong Packaging Group
and the transaction was completed on 6 th January 2023, presented as non-adjusting event after
the reporting period. Following the completion of the transaction, purchase accounting for the
acquisition has been initiated, including the preparation of a purchase price allocation. As of the
date of authorisation for issuance of these financial statements, given the size, complexity and
timing of the acquisition, the provisional purchase price allocation is incomplete. Accordingly,
assets acquired, liabilities assumed, and the resulting non-controlling interest and goodwill to be
recognised have not yet been estimated on a preliminary basis and therefore not presented.
The goodwill will represent the expected synergies, mainly through sourcing, containerboard
integration optimisation and commercial opportunities. The goodwill will be allocated to Divisions
benefiting from the acquisition, Packaging Solutions and Packaging Materials. None of the
goodwill recognised is expected to be deductible for tax purposes. The shares of the acquired
companies are mainly 100% owned, with certain units having minor non-controlling interests.
The non-controlling interest will be measured based on the proportionate share of the identifiable
net assets.
The preliminary cash purchase consideration was EUR 612 million, excluding contingent
earn-out component. The earn-out component will be settled in cash in 2024 and is subject to
De Jong Packaging Group achieving certain earnings thresholds. The contingent consideration
is measured at its fair value at the date of acquisition and the maximum amount of earn-out is
EUR 45 million. The final purchase price is subject to customary purchase price adjustments.
De Jong Packaging Group is based in the Netherlands and is one of the largest corrugated
packaging producers in the Benelux countries. De Jong Packaging Group is also active in
containerboard production through the acquisition of the De Hoop mill in the Netherlands in
2021. De Jong Packaging Group has 17 sites in the Netherlands, Belgium, Germany and the UK
and it employs approximately 1,300 people. With the acquisition, Stora Enso’s Packaging
Solutions division will increase its corrugated packaging capacity by approximately 1,200 million
m 2 to more than 2,000 million m 2, including De Jong Packaging Group’s ongoing expansion
projects.
The acquisition will advance Stora Enso’s strategic direction, accelerate revenue growth and
build the market share in renewable packaging in Europe. De Jong Packaging Group's product
portfolio and geographic presence will complement and enhance Stora Enso’s offering. The
acquisition is also expected to generate synergies over the cycle, mainly through sourcing,
containerboard integration optimisation and commercial opportunities. The acquired units will be
reported in Packaging Solutions and Packaging Materials divisions.
39
Disposal of Group companies

| Year Ended 31 December
EUR million | 2022 | 2021
Net assets sold |  |
Cash and cash equivalents | 90 | 12
Property, plant and equipment | 8 | 32
Intangible assets | 0 | 1
Working capital | -1 | 10
Tax assets and liabilities | 6 | 9
Interest-bearing assets and liabilities | -19 | -1
Net assets in disposed companies | 85 | 62
Total disposal consideration | 70 | 67
CTA release | -47 | 1
Asset writedowns 1 | -155 | -20
Loan impairments | -23 | 0
Transaction costs | -4 | -2
Total net gain/loss | -244 | -16
1 2022 mainly related to writedowns in connection to Russia operations and including also writedowns related to assets held for sale.

2022
Kvarnsveden site
In December 2022, Stora Enso divested its 100% owned Kvarnsveden site in Sweden to
Northvolt, a European supplier of sustainable battery cells. Due to structural decline in demand
for graphical paper, in April 2021 Stora Enso announced a plan to close its Kvarnsveden paper
site and the production was ended in September 2021. The site will be developed into a battery
manufacturing plant, reusing and refurbishing the existing facilities and site infrastructure. The
sold unit was part of segment Other at the time of disposal. The transaction did not have a
significant impact on the Group.
Russia operations - Wood Products and Forest
In July 2022, Stora Enso divested its two Nebolchi and Impilahti sawmills in Russia to local
management. In addition, the divestment included Russian forest operation s which supplies
wood to the sawmills. The disposed sawmill sites are located in Novgorod and Karelia and have
a total annual capacity of 350,000 m 3 of sawn timber, including 55,000 m 3 of processed timber
and 65,000 tonnes of pellets. Russian forest operations managed long-term harvesting rights for
around 370,000 hectares. The divested seven legal entities were mainly 100% owned, with
exception of one unit that was 99.48% owned. Related to one forest operations unit, the disposal
will be completed in 2023, upon finalisation of certain formalities. This does not have any
significant impact on the Group. During 2022, the Group recognised asset write-downs of EUR
74 million (mainly fixed assets, inventories and trade receivables) related to the transaction.
About two thirds of the sale consideration is to be received in instalments at future dates. The
loss on disposal was EUR 24 million, including cumulative translation adjustments (CTA) being
released from equity to income statement. In addition, there were impairments of loan
receivables of EUR 23 million related to the transaction. The sold units were part of the Wood
Products and Forest divisions.
Russia operations - Packaging Solutions
In May 2022, Stora Enso divested its three 100% owned corrugated packaging plants in Russia
to local management. The divested three packaging plants are located in Lukhovitsy, Arzamas
and Balabanovo and have a total annual capacity of 395 million m² of corrugated packaging. The
sites primarily produce corrugated packaging in the domestic Russian market. During 2022, the
Group recognised asset write-downs of EUR 42 million (mainly fixed assets, inventories and
trade receivables) related to the transaction. The sale consideration is to be received in
instalments at future dates. The loss on disposal was approximately EUR 49 million, consisting
mainly of cumulative translation adjustments (CTA) being released from equity to income
statement. The sold units were part of the Packaging Solutions division.
Vlar Papier
In February 2022, Stora Enso divested its 100% shareholdings in Vlar Papier NV in Belgium.
The sold company was part of the Paper division. The transaction did not have a significant
impact on the Group.
2021
Laos
In September 2021, Stora Enso divested its 100% shareholdings in Stora Enso Laos Plantation
AB and Stora Enso Lao Co Ltd to SilviCarbon. Stora Enso operated plantations in Laos since
2007, with approximately 3 800 hectares of land use rights. After the transaction, Stora Enso
does not own any forest assets in Laos. The sold companies were part of the Forest division.
The transaction did not have a significant impact on the Group.
ECO RFID
In September 2021, Stora Enso divested its ECO RFID technology business to Group CCRR.
The sold business was part of the segment Other. The transaction did not have a significant
impact on the Group.
Sachsen
In May 2021, Stora Enso signed an agreement to divest its 100% shareholding in the Sachsen
Mill to Model Group. The mill is located in Eilenburg, Germany and has an annual production
capacity of 310 000 tonnes of newsprint specialty paper based on recycled paper. The disposal
was completed in August 2021 and Stora Enso will continue to sell and distribute Sachsen’s
products under a contract manufacturing agreement for a period of 18 months after the closing.
During the second quarter of 2021, the Group recognised asset impairments of EUR 20 million
related to the transaction. The consideration received by Stora Enso for the divestment of the
shares was EUR 53 million. The final disposal loss was not significant. Sachsen Mill was part of
the Paper division.
Forest division units
In March and June 2021, Stora Enso divested its 100% shareholdings in several wind turbine
project and real estate related companies. These companies were mainly acquired in May 2019
in connection to Bergvik Skog AB restructuring. The sold companies were part of Forest division.
The transactions did not have a significant impact on the Group.
40
Assets held for sale

| Year Ended 31 December
EUR million | 2022 | 2021
Property, plant and equipment | 264 | 0
Intangible assets | 55 | 0
Inventories | 91 | 0
Current operative receivables | 104 | 0
Tax assets | 0 | 0
Assets held for sale | 514 | 0
Non-current operative liabilities | 42 | 0
Current operative liabilities | 163 | 0
Tax liabilities | 28 | 0
Interest-bearing liabilities | 4 | 0
Liabilities related to assets held for sale | 237 | 0

Assets held for sale at the end of 2022 include the Maxau, Nymölla and Hylte sites.
I n September 2022, Stora Enso signed an agreement to divest its 100% owned Maxau paper
production site in Germany and all related assets to Schwarz Produktion (part of Schwarz
Group) with an enterprise value of approximately EUR 210 million. The transaction is expected
to be completed during the first half of 2023. The mill has an annual supercalendered paper (SC
paper) capacity of 530,000 tonnes. Maxau mill is part of the Paper division.
In September 2022, Stora Enso signed an agreement to divest its 100% owned Nymölla
paper production site in Sweden and all related assets to Sylvamo, a US-based global producer
of uncoated paper, with an enterprise value of approximately EUR 150 million. Transaction was
completed in the beginning of 2023. The Nymölla site’s annual capacity is 485,000 metric tonnes
of wood free uncoated office papers. In 2022 and in connection to the transaction, the Group
recognised approximately EUR 14 million of asset writedowns. Nymölla mill is part of the Paper
division.
In January 2023, Stora Enso signed an agreement to divest its 100% owned Hylte paper
production site in Sweden to Sweden Timber with an enterprise value of approximately EUR 18
million. The transaction is expected to be completed during the first half of 2023. The Hylte site's
annual capacity is 245,000 tonnes of newsprint paper. In 2022 and in connection to the
transaction, the Group recognised approximately EUR 19 million of asset writedowns in the unit.
Hylte mill is part of the Paper division.
41
Note 5 Other operating income and expense
Accounting principles
Research and development
Research costs are expensed as incurred in other operating expenses in the consolidated
income statement. Development costs are also expensed as incurred unless they meet the
criteria to be recognised as intangible assets in accordance with IAS 38, in which case they are
capitalised as intangible assets and depreciated over their expected useful lives.
Government grants
Government grants relating to the purchase of property, plant and equipment are deducted from
the carrying value of the asset, while the net cost is capitalised. Other government grants are
recognised as income on a systematic basis over the periods necessary to match them with the
related costs which they were intended to compensate.
Green certificates
Stora Enso is part of the local green energy production system which entitles selected mills in
Europe to receive green certificates based on megawatt hours of green energy produced. Green
certificates received are recognised at grant date market value only in the balance sheet. As
such, subsequent changes in market prices do not have an impact on the income statement and
the income is recognised only when certificates are sold.
Other operating income and expense

| Year Ended 31 December
EUR million | 2022 | 2021
Other operating income |  |
Emission rights allocated and disposal gains | 177 | 154
Sale of green certificates | 10 | 20
Gains on disposal of fixed assets | 4 | 31
Gains on disposal of Group companies and business operations | 18 | 34
Dividend and gain on sale of unlisted shares | 1 | 0
Insurance compensation | 10 | 7
Other 1 | 85 | 83
Government grants | 16 | 14
CTA release | 5 | 2
Total | 326 | 345

1 Including rent income, fair value changes for non-hedge accounted derivatives and other items. Derivatives are discussed in more detail
in Note 27 Derivatives.

| Year Ended 31 December
EUR million | 2022 | 2021
Other operating expenses |  |
Lease expenses | 40 | 38
Research and development | 89 | 82
Credit losses, net of reversals | 13 | 3
Losses on disposal of Group companies and business operations | 26 | 3
CTA release | 52 | 16
Provision changes in income statement | 31 | 184
Other 1 | 342 | 284
Total | 594 | 610
1 Including expenses related to, among others, consultancy and other services, IT and telecommunications, properties and administration, audit, training, travelling, insurance, penalties, currency translation differences on operative payables.
| Year Ended 31 December
Materials and services include | 2022 | 2021
Emissions rights to be delivered | 112 | 99

The Group has recorded an other operating income of EUR 177 (EUR 154) million related to
Emissions. Under Materials and Services an expense of EUR 112 (EUR 99) million has been
booked related to the cost of CO 2 emissions from production. Actual realised profits amounted to
EUR 59 (EUR 22) million on the disposal of surplus rights. See Note 15 Emission rights and
other non-current assets for more details related to emission rights. The income from the sale of
green certificates amounted to EUR 10 (EUR 20) million.
Lease expenses include expenses relating to short-term leases of EUR 12 (EUR 10) million,
low-value assets of EUR 21 (EUR 20) million and variable lease payments not included in the
measurement of lease liabilities of EUR 2 (EUR 3) million. Lease expenses also include service
payments included in lease contracts, which are not included in the measurement of lease
liabilities.
Auditor's fees and services

| Year Ended 31 December
EUR million | 2022 | 2021
Audit fees | 4 | 4
Audit-related | 0 | 0
Tax fees | 0 | 0
Other fees | 0 | 0
Total | 4 | 4

Aggregate fees for professional services rendered to the Group principal auditor PwC amounted
to EUR 4 (EUR 4) million. Audit fees relate to the auditing of the annual financial statements or
ancillary services normally provided in connection with statutory and regulatory filings. Audit-
related fees are incurred for assurance and associated services that are reasonably related to
the performance of the audit or for the review of financial statements.
42
Note 6 Personnel expenses
Personnel expenses

| Year Ended 31 December
EUR million | 2022 | 2021
Wages and salaries | 996 | 1,017
Pension expenses | 152 | 165
Share-based remuneration | 8 | 7
Other statutory employer costs | 140 | 143
Other voluntary costs | 20 | 19
Total | 1,315 | 1,351

Pension expenses

| Year Ended 31 December
EUR million | 2022 | 2021
Defined benefit plans | 5 | 12
Defined contribution plans | 146 | 153
Total | 152 | 165

The average number of employees in 2022 amounted to 21,790 compared with 23,071 in 2021.
Pension costs are discussed further in Note 20 Post-employment benefit obligations.
In 2022, the expense of the share-based remuneration was EUR 8 (EUR 7) million. Share-
based remuneration comprising of share awards is described in more detail in Note 21
Employee variable compensation and equity incentive schemes. Remuneration of the Group
Leadership Team and Board are described in Note 7 Board and executive remuneration.
Note 7 Board and executive remuneration
Boar d and committee remuneration

| Year Ended 31 December |
| 2022 | 2021 |
EUR thousand (before taxes) | Cash | Value of shares 1 | Total 4 | Total | Committee memberships
Board members at 31 December 2022 |  |  |  |  |
Antti Mäkinen, Chair | 133 | 81 | 214 | 208 | People and Culture, Nomination2,3
Håkan Buskhe, Vice Chair | 76 | 46 | 122 | 118 | People and Culture, Nomination2,3
Elisabeth Fleuriot | 63 | 32 | 94 | 91 | Financial and Audit
Hock Goh | 63 | 32 | 94 | 91 | Financial and Audit
Helena Hedblom | 54 | 32 | 86 | 82 | Sustainability and Ethics
Kari Jordan | 54 | 32 | 86 |  | People and Culture
Christiane Kuehne | 58 | 32 | 90 | 87 | Sustainability and Ethics
Richard Nilsson | 69 | 32 | 101 | 97 | Financial and Audit
Hans Sohlström | 54 | 32 | 86 | 82 | Sustainability and Ethics
Former Board members |  |  |  |  |
Mikko Helander (until 15 March 2022) | 0 | 0 | 0 | 82 |
Total remuneration as Directors 1 | 624 | 348 | 972 | 939 |
1 40% of the Board remuneration, excluding Committee remuneration, in 2022 was paid in Stora Enso R shares purchased from the market and distributed as follows: to Chair 4 332 R shares, Vice Chair 2 454 R shares, and members 1 686 R shares each. The Company has no formal policy requirements for the Board members to retain shares received as remuneration. 2 Stora Enso’s Shareholders’ Nomination Board has been appointed by the AGM in 2016 to exist until otherwise decided. The Shareholders’ Nomination Board according to its Charter as approved by the AGM comprises of four members: the Chair and Vice Chair of the Board of Directors, as well as two members appointed by the two largest shareholders (one each) as of 31 August each year. No separate remuneration is paid to members of the Nomination Board. 3 Marcus Wallenberg, appointed by FAM AB, is Chair of the Nomination Board. Reima Rytsölä is the member of the Shareholders’ Nomination Board appointed by Solidium Oy. Antti Mäkinen and Håkan Buskhe were appointed as members of the Shareholders’ Nomination Board in their roles as Chair and Vice Chair of the Board of Directors. 4 The Company additionally pays the transfer tax for share purchases for each member, in line with AGM decision, which amount is considered also taxable income for each member.

Shareholders at the Annual General Meeting (AGM) have established a Shareholders’
Nomination Board to exist until otherwise decided and to annually prepare proposals for the
AGM's approval concerning the number of members of the Board of Directors, the Chair, Vice
Chair and other members of the Board, as well as the remuneration for the Chair, Vice Chair and
members of the Board and its committees.
43
Board share interests at 31 December 2022

| Shares held
| A | R
Board members at 31 December 2022 |  |
Antti Mäkinen, Chair |  | 16,576
Håkan Buskhe, Vice Chair |  | 7,933
Elisabeth Fleuriot |  | 30,029
Hock Goh |  | 34,782
Helena Hedblom |  | 3,517
Kari Jordan |  | 1,686
Christiane Kuehne |  | 14,590
Richard Nilsson 1 | 127 | 27,132
Hans Sohlström 2 |  | 13,517
Total shares held | 127 | 149,762
1 Spouse holds 127 of A shares and 236 of R shares 2 Spouse holds 179 of the shares

The following Board members also served in 2022

| Shares held when Board membership ended | Effective date of Board membership ending
Mikko Helander | 8,910 | 15 March 2022

Group Leadership Team (GLT) remuneration and share interests
The table below includes the remuneration earned by GLT members during the year, including
those shares with performance conditions that have ended and are due to vest in the coming
year. The company recommends and expects the CEO and GLT members to hold Stora Enso
shares at a value corresponding to at least one annual base salary. Stora Enso shares received
as remuneration are therefore recommended not to be sold until this level has been reached.
The aggregate cost of earned remuneration for GLT in 2022 amounted to EUR 15 (EUR 11)
million. The total number of GLT members was eleven (thirteen) at the year end in 2022.
In accordance with their respective pension arrangements, GLT members may retire at sixty-
five years of age with pensions consistent with local practices in their respective home countries.
Contracts of employment provide for six months’ notice prior to termination with severance
compensation of twelve months basic salary if the termination is at the Company’s request.
The outcome of the financial targets relating to the Short term incentive programmes for the
performance year 2022, and Long term incentive programmes for the performance years 2020
to 2022 were reviewed and confirmed by the People and Culture Committee, and approved by
the Board of Directors in January 2023.
Note 21 Employee variable compensation and equity incentive schemes includes details of
incentive schemes and share opportunity programmes for the management and staff of Stora
Enso.
Group Leadership Team remuneration

| Year Ended 31 December
| 2022 | 2021
EUR thousand | CEO | Others 2,5 | GLT Total | CEO | Others | GLT Total
Remuneration 1,4 |  |  |  |  |  |
Annual salary | 953 | 4,802 | 5,755 | 981 | 4,695 | 5,676
Local housing (actual costs) | 0 | 2 | 2 | 0 | 1 | 1
Other benefits | 32 | 272 | 304 | 33 | 342 | 375
Termination benefits | 0 | 0 | 0 | 0 | 0 | 0
Short Term Incentive programme 3 | 845 | 2,167 | 3,012 | 672 | 2,053 | 2,725
Long Term Incentive programme 3 | 987 | 2,848 | 3,835 | 0 | 137 | 137
| 2,817 | 10,091 | 12,908 | 1,686 | 7,228 | 8,914
Pension Costs |  |  |  |  |  |
Mandatory plans | 477 | 1,154 | 1,631 | 341 | 1,226 | 1,567
Stora Enso voluntary plans | 0 | 933 | 933 | 0 | 735 | 735
| 477 | 2,087 | 2,564 | 341 | 1,961 | 2,302
Total Compensation | 3,294 | 12,178 | 15,472 | 2,027 | 9,189 | 11,216
1 The Finnish Corporate Governance code requires companies to report remuneration that is paid or due, and due to this the figures presented in the above table do not directly reconcile with the amounts recognised as personnel expenses in the Income statement as presented in the below table Group Leadership Team remuneration in Income statement. 2 Include earnings related to Teemu Salmi until 20 May 2022 and Kati ter Horst until 30 June 2022 and Jari Suominen until 30 November 2022. 3 Relate to amounts due at year end, which will be paid in 2023. LTI value is calculated using the 30 December 2022 closing price of EUR 13.15. The final value of the vested shares will depend on the share price on vesting date 1 March 2023. 4 Remuneration for executives is disclosed only for the period during which they were GLT members. 5 Remuneration of GLT members increased in 2022 compared to 2021 mainly due to the performance outcome of variable pay programmes. The average number of GLT members during 2022 was 11.71.

Group Leadership Team remuneration in Income statement

| Year ended 31 December
| 2022 | 2021
EUR thousand | CEO | Others | GLT Total | CEO | Others | GLT Total
Salaries and other short-term employee benefits | 1,830 | 7,243 | 9,073 | 1,686 | 7,091 | 8,777
Long Term Incentive programme 1, 2 | 714 | 1,581 | 2,295 | 468 | 1,638 | 2,106
Post-employment benefits | 477 | 2,087 | 2,564 | 341 | 1,961 | 2,302
Total recognised in Income statement | 3,021 | 10,911 | 13,932 | 2,495 | 10,690 | 13,185
1 The costs of long-term incentive (LTI) programmes are recognised as costs over the three year vesting period based on the share price at grant date and the estimate of equity instruments that will eventually vest. 2 Year 2021 figures have been restated.

Executives other than CEO
Short term incentive (STI) programmes for management
In 2022, GLT members have STI programmes with up to a maximum of 70% or 80% of their
annual fixed salary, payable the year after the performance period. 70% of the STI for 2022 was
based on financial measures and 30% on individual key targets.
Long term incentive (LTI) programmes for management
The 2020 LTI programme has a three-year performance period. The 2021 programme has three
one-year performance periods which are accumulated after three years. The 2022 programme
features performance metrics with one-year performance periods, which are accumulated after
44
three years, as well as three-years performance periods. All three programmes will be settled in
only one portion after three years, and the absolute maximum vesting level is 100% of the
number of shares granted. The 2020 programme is related to performance period 2020–2022,
the 2021 programme is related to performance period 2021–2023 and the 2022 programme is
related to performance periods 2022–2024. The opportunity under the programmes is in
Performance Shares, where the shares are vested in accordance with performance criteria
proposed by the People and Culture Committee and approved by the Board of Directors.
During the year the 2022 programme was launched, in which the GLT members (in GLT at
year end) can potentially receive a value corresponding to 242,650 shares before taxes,
assuming the maximum vesting level during the three-year vesting period (2022–2024) is
achieved. The total number of shares actually transferred will be lower because a portion of
shares corresponding to the tax obligation will be withheld to cover income tax.
The fair value of employee services received in exchange for share-based compensation
payments is accounted for in a manner that is consistent with the method of settlement and is
either cash or equity settled as described in more detail in Note 21. For the equity settled part, it
is possible that the actual cash cost does not agree with the accounting charges because the
share price is not updated at the time of the vesting. The figures in the Group Leadership Team
Remuneration table refer to individuals who were executives at year end or during part of the
year.
At the end of the year, the performance period for the 2020 programme ended, and will be
settled in one portion after three years in March 2023, dependent on Economic Value Added
(EVA) for the Stora Enso Group and Earnings Per Share (EPS) for the Stora Enso Group. The
Performance Share programme resulted in a 100% performance outcome. The number of
shares due for executives (GLT members at year end) from programmes that ended during 2022
amounted to 265,340 shares. The total number of shares actually transferred will be lower
because a portion of shares corresponding to the tax obligation will be withheld to cover income
tax.
President & Chief Executive Officer – Annica Bresky
The CEO has been employed by Stora Enso since 1 May 2017 and assumed the position as
CEO on 1 December 2019. She has a notice period of six months with a severance payment of
twelve months salary on termination by the company but with no contractual payments on any
change of control. The CEO’s benefits include pension provisions. The CEO’s pension plan has
contributions equal to the collectively agreed pension plan in Sweden (ITP1), with a pensionable
salary consisting of annual base salary, vacation pay, and actual paid STI. The retirement age is
sixty-five years.
Short term incentive (STI) programme for CEO
In 2022, the CEO is entitled to an STI programme decided by the Board each year giving a
maximum of 100% of the annual fixed salary. The STI for 2022 was 70% based on financial
measures, and 30% based on ESG-, operational- and individual key measures.
Long term incentive (LTI) programmes for CEO
The CEO participates in 2020, 2021 and 2022 share based LTI programmes. The 2020
programme has a three-year performance period. The 2021 programme has three one-year
performance periods which are accumulated after three years. The 2022 programme features
performance metrics with one-year performance periods which are accumulated after three
years as well as performance metrics with three-years performance periods. All three
programmes will be settled in only one portion after three years. The 2020 programme is related
to performance period 2020–2022, the 2021 programme is related to performance period 2021–
2023 and the 2022 programme is related to performance periods 2022–2024. The opportunity in
the programmes is in performance shares, where shares vest in accordance with performance
criteria proposed by the People and Culture Committee and approved by the Board of Directors.
During the year the 2022 LTI programme was launched in which the CEO has the potential to
receive a value corresponding to a maximum of 65,430 shares before taxes. The grant value of
EUR 1,154,251 is based on the share price at the grant date, assuming a maximum vesting level
during the three-year vesting period (2022–2024) is achieved. The total number of shares
actually transferred will be lower because a portion of shares corresponding to the tax obligation
will be withheld to cover income tax.
At the end of the year, the performance period for the 2020 programme ended and will be
settled in one portion after three years in March 2023, dependent on Economic Value Added
(EVA) and Earnings Per Share (EPS) for the Stora Enso Group. 75,080 shares are due for the
CEO from Performance Share programmes that ended during 2022 due to a 100% performance
outcome.
Group Leadership Team share interests

Executives in office at the year end | R shares held 1 | Shares due 2023 2 | Performance share opportunity 2024–2025 5
Annica Bresky | 19,763 | 75,080 | 122,817
Seppo Parvi | 50,924 | 25,340 | 43,484
Tobias Bäärnman | 1,960 | 5,200 | 22,629
David Ekberg | 1,245 | 17,640 | 32,481
Johanna Hagelberg | 28,146 | 17,440 | 32,803
Rene Hansen | — | 3,400 | 12,000
Hannu Kasurinen | 38,421 | 29,640 | 47,406
Katariina Kravi | — | 21,500 | 27,938
Per Lyrvall 3 | 73,383 | 22,100 | 34,459
Annette Stube | — | 20,000 | 26,271
Lars Völkel | — | 28,000 | 41,623
Total, serving officers 4 | 213,842 | 265,340 | 443,911
1 None of the GLT members holds A shares. 2 Shares due to GLT member are gross of taxes for the LTI programmes with performance periods that ended in 2022 and are due to be paid 2023. The Performance Share programme resulted in a 100% performance outcome due to be paid in 2023. Some GLT members hold restricted shares in the Restricted Shares programme that ended in 2022 and those shares are due to be paid 2023. 3 Spouse holds 1 257 of the shares. 4 The Company recommends and expects GLT members to hold Stora Enso shares at a value corresponding to at least one annual base salary. Stora Enso shares received as remuneration are therefore recommended not to be sold until this level has been reached. 5 Potential shares to GLT members are gross of taxes for LTI programmes with performance periods that end in 2023-2024 and are due to be paid 2024-2025.

The following Executive Officers also served in 2022 | R shares held when GLT membership ended | Performance Share Awards when GLT Membership Ended | Restricted Share Awards When GLT Membership Ended | Effective date of GLT membership ending
Teemu Salmi 1 | 10,150 | 32,380 | 2,335 | 20 May 2022
Kati ter Horst 1 | 61,996 | 86,556 | — | 30 June 2022
Jari Suominen 1 | 53,168 | 65,331 | — | 30 November 2022
1 Unvested shares are forfeited at end of employment

45
Note 8 Net financial items
Accounting principles
Net financial items comprise net interest expenses, foreign exchange gains and losses and other
financial income and expenses mainly arising from interest-bearing assets and liabilities.
Financial income and expense

| Year Ended 31 December
EUR million | 2022 | 2021
Net financial expense in the income statement |  |
Financial income | 40 | 42
Financial expense | -191 | -190
Total | -151 | -149
Represented by |  |
Interest expense |  |
Interest expense from borrowings measured at amortised cost | -96 | -95
Interest component of the effective hedges under cash flow hedge | -12 | -15
Interest expense on leases | -17 | -17
Interest capitalised | 0 | 1
Interest income on loans and receivables measured at amortised cost | 20 | 2
Net interest expense | -105 | -124
Foreign exchange gains and losses |  |
Currency derivatives | 8 | -39
Borrowings, cash equivalents. lease liabilities and other | -10 | 37
Net foreign exchange gains and losses | -1 | -2
Other financial income | 2 | 1
Other financial expense |  |
Financial fees | -8 | -17
Fair valuation losses | -4 | -3
Impairments of interest-bearing assets | -30 | 0
Net interest on net defined benefit liabilities | -3 | -3
Net other financial expense | -45 | -22
Total | -151 | -149
Gains and losses on derivative financial instruments are shown in Note 27 Derivatives.

In 2022, the net interest expense decreased mainly as a result of higher interest income rate on
loans and receivables. Costs on long-term debt issues capitalised as part of non-current debt
amounted to EUR 6 (EUR 7) million in the statement of financial position. During the year, EUR
2 (EUR 4) million was amortised through interest expense by using the effective interest rate
method.
Exchange gains and losses for currency derivatives mainly relate to non-hedge accounted
instruments fair valued in the income statement. The amount reported as other financial income
mainly consists of fair valuation gains, while other financial expense in the table above relates to
net financial fees for unused committed credit facilities, guarantees and negative interest on
deposits. Impairments of interest-bearing assets relate to divestment of Russia operations and
are discussed in more detail in Note 4 Acquisitions and disposals.
Note 9 Income taxes
Accounting principles
The Group income tax expense/benefit includes taxes of Group companies based on taxable
profit/loss for the period, together with tax adjustments for previous periods and the change in
deferred ta xes. Tax assets and liabilities reflect uncertainty related to income taxes, if any.
Deferred taxes are provided using the liability method, as measured with enacted, or
substantially enacted, tax rates, to reflect the net tax effects of all temporary differences between
the tax bases and the accounting bases of assets and liabilities. No deferred tax is recognised
for the initial recognition of goodwill and the initial recognition of an asset or liability in a
transaction which is not a business combination, and at the time of the transaction this affects
neither accounting profit nor taxable profit. Deferred tax assets reduce income taxes payable on
taxable income in future years. The deferred tax assets, whether arising from temporary
differences or from tax losses, are recognised only to the extent that it is probable that future
taxable profits will be available against which the assets can be utilised.
Tax expense

| Year Ended 31 December
EUR million | 2022 | 2021
Current tax | -196 | -118
Deferred tax | -126 | -34
Total income tax | -322 | -151

Income tax rate reconciliation

| Year Ended 31 December
EUR million | 2022 | 2021
Profit before tax | 1,858 | 1,419
Tax at statutory rates applicable to profits in the country concerned 1 | -337 | -263
Non-deductible expenses and tax exempt income 2 | -15 | 49
Valuation of deferred tax assets | 15 | -7
Taxes from prior years | 2 | 39
Changes in tax rates and tax laws | 0 | 1
Profits from equity accounted investments | 44 | 29
Other 3 | -31 | 1
Total income taxes | -322 | -151
Effective tax rate | 17.3% | 10.7%
Statutory tax rate (blended) | 18.2% | 18.5%
1 Includes a EUR 55 million impact from countries with tax holidays and tax benefits in 2022 and a EUR 37 million impact from tax holidays and other tax benefits in 2021. 2 The tax value of non-deductible expenses of EUR 16 million has been netted against tax exempt income of 1 EUR million in 2022, and tax value of non-deductible expenses of EUR 30 million has been netted against tax exempt income of EUR 79 million in 2021. 3 Includes a EUR 34 million negative impact from disposal of Russian operations in 2022.

The statutory tax rate is a weighted average of the statutory tax rates prevailing in jurisdictions
where Stora Enso operates.
46
Change in deferred taxes in 2022

EUR million | Value at 1 Jan 2022 | Income statement | OCI | Acquisitions / disposals 1 | Translation difference | Value at 31 Dec 2022
Forest assets | -1,268 | -43 | -53 | 0 | 97 | -1,267
Fixed assets | -103 | -44 | 0 | 17 | 7 | -123
Financial instruments | 1 | -3 | -8 | 0 | 0 | -10
Untaxed reserves | -80 | -16 | 0 | 4 | 7 | -85
Pensions and provisions | 58 | -1 | -25 | -4 | -2 | 26
Tax losses and tax credits carried forward | 107 | -34 | 0 | 0 | 1 | 74
Other deferred taxes | -2 | 19 | 0 | -2 | 0 | 15
Total | -1,287 | -122 | -86 | 15 | 110 | -1,370
Equity hedges and net investment loans (CTA) |  | -3 | 3 |  |  |
Cash flow hedging |  | 0 | 0 |  |  |
Change in deferred tax |  | -125 | -83 | 15 | 110 |
Assets 2 | 143 |  |  |  |  | 74
Liabilities 2 | -1,430 |  |  |  |  | -1,443
1 Includes assets held for sale. 2 Deferred tax assets and liabilities have been offset in accordance with IAS 12. OCI = Other Comprehensive income, CTA = Cumulative Translation Adjustment

Change in deferred taxes in 2021

EUR million | Value at 1 Jan 2021 | Income statement | OCI | Acquisitions / disposals | Translation difference | Value at 31 Dec 2021
Forest assets | -1,175 | -70 | -40 | 0 | 16 | -1,268
Fixed assets | -173 | 75 | 0 | -8 | 3 | -103
Financial instruments | -11 | 3 | 8 | 0 | 1 | 1
Untaxed reserves | -39 | -43 | 0 | 0 | 2 | -80
Pensions and provisions | 56 | 27 | -23 | 0 | -2 | 58
Tax losses and tax credits carried forward | 104 | 1 | 0 | 0 | 2 | 107
Other deferred taxes | 23 | -26 | 0 | -1 | 2 | -2
Total | -1,215 | -33 | -55 | -9 | 24 | -1,287
Equity hedges and net investment loans (CTA) |  | -2 | 2 |  |  |
Change in deferred tax |  | -35 | -53 | -9 | 24 |
Assets 1 | 117 |  |  |  |  | 143
Liabilities 1 | -1,332 |  |  |  |  | -1,430
1 Deferred tax assets and liabilities have been offset in accordance with IAS 12. OCI = Other Comprehensive income, CTA = Cumulative Translation Adjustment

The recognition of deferred tax assets is based on the Group’s estimations of future taxable
profits available against which the group can utilise the benefits.
Non-recognised deferred tax assets on deductible temporary differences amounted to EUR 50
(EUR 58) million. There is no expiry date for these differences. Taxable temporary differences in
respect of investments in subsidiaries, branches and associates and interests in joint operations,
for which deferred tax liabilities have not been recognised amounted to EUR 367 (EUR 339)
million.
Tax losses

| As at 31 December
| Tax losses carried forward | Recognised tax values | Unrecognised tax values
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Expiry within five years | 359 | 417 | 5 | 7 | 72 | 79
Expiry after five years | 100 | 343 | 9 | 60 | 14 | 11
No expiry | 1,173 | 1,137 | 58 | 38 | 198 | 210
Total | 1,633 | 1,897 | 73 | 106 | 283 | 300

At the end of 2022, there were no material tax losses related to Finland. At the end of 2021 tax
losses of EUR 274 million related to Finland and a deferred tax asset of EUR 55 million was
recognized relating to these tax losses.
Uncertain tax positions
At balance sheet date there were on-going tax audits in several jurisdictions. It is not expected
that any significant additional taxes in excess of those already recorded for will arise as a result
of these audits.
Note 10 Depreciation, amortisation and impairment charges
Accounting principles
Depreciation, amortisation and impairment charges
Depreciation or amortisation of an asset begins when it is available for use in the location and
condition necessary for it to be operated in the manner intended by management. Depreciation
or amortisation ceases when the asset is derecognised or classified as held for sale.
Depreciation or amortisation does not cease when the asset becomes idle. Tangible and
intangible assets are depreciated and amortised on a straight-line basis during their useful lives.
Useful lives are reviewed annually. If an asset is disposed of, proceeds exceeding the carrying
value of the asset up to its historical cost are netted against depreciation, amortisation and
impairment charges. Only disposal proceeds exceeding the historical cost of an asset are
presented as other operating income (Note 5). If the asset’s book value is higher than the
disposal proceeds, the difference is recognised as an impairment in the period when reliable
estimate of disposal loss is available, at the latest when a binding sales contract is signed. Right-
of-use (ROU) assets are depreciated using the straight line method from the commencement
date of the contract to the earlier of the end of the lease term or the end of the useful life of the
ROU assets.
The carrying amounts of intangible assets, property, plant and equipment and ROU assets
are reviewed at each reporting date to determine whether there is any indication of impairment,
whereas goodwill is tested annually. If any such indication exists, the recoverable amount is
estimated as the higher of the fair value less costs of disposal and the value in use, with an
impairment loss being recognised whenever the carrying amount exceeds the recoverable
amount.
A previously recognised impairment loss is reversed if there has been a change in the
estimates used to determine the recoverable amount, however, not to an extent higher than the
carrying amount that would have existed had no impairment loss been recognised in prior years.
For goodwill, however, a recognised impairment loss is not reversed.
47
Whilst intangible assets, property, plant and equipment and ROU assets are subject to
impairment testing at the cash generating unit (CGU) level, goodwill is subject to impairment
testing at the CGU level for groups of CGUs, which represents the lowest level within the Group
at which goodwill is monitored for internal management purposes.
Depreciation, amortisation and impairment charges

| Year ended 31 December
EUR million | 2022 | 2021
Depreciation and amortisation |  |
Intangible assets | 24 | 26
Buildings and structures | 81 | 79
Plant and equipment | 371 | 373
Right-of-use assets | 50 | 62
Other tangible assets | 8 | 9
Total | 533 | 549
Impairment |  |
Goodwill | 11 | 4
Intangible assets | 1 | 7
Buildings and structures | 25 | 10
Plant and equipment | 75 | 126
Right-of-use assets | 0 | 1
Other tangible assets | 2 | 2
Total | 114 | 149
Reversal of impairment |  |
Plant and equipment | -7 | 0
Total | -7 | 0
Disposal gains/losses |  |
Gain on sale of assets | -10 | -4
Loss on sale of assets | 4 | 3
Total | -5 | 0
Depreciation, amortisation and impairment charges | 635 | 697

Impairment testing
The recoverable amount for the cash generating units (CGUs) has been determined based on a
value in use calculation using cash flow projections from financial estimates approved by the
Board of Directors and management. The pre-tax discount rates are calculated for each CGU
taking into account the business environment of the CGU and the tax and risk profile of the
country in which the cash flow is generated. The table in the goodwill impairment testing section
below sets out the pre-tax discount rates used for goodwill impairment testing, which are similar
to those used in the impairment testing of other intangible assets, property, plant and equipment,
and ROU assets.
Impairments were tested using a value in use method for each CGU based on the following
main assumptions:
•Sales price estimates in accordance with internal and external specialist analysis
•Cash flows and discount rates were prepared in nominal terms
•Current cost structure to remain unchanged
•For goodwill testing, a five-year future period was used, after which the perpetuity value was
determined using inflation based growth rates, except for Paper division for which the testing
period used was the remaining expected economic life
•For intangible assets, property, plant and equipment, and ROU assets testing period was the
remaining expected economic life of the assets.
Property, plant and equipment, other intangible assets and ROU assets
impairments
The total impairment charges on property, plant and equipment, other intangible assets and
ROU assets in 2022 amounted to EUR 103 (EUR 145) million and resulted from business
restructuring and Group company disposals. In 2022, impairments were mainly related to Group
company disposals in Russia and upcoming disposals in the Paper division. Russia related
impairments of EUR 75 million concerned Wood Products Baltic and Russia CGU, Packaging
Solutions Europe CGU and Forest operations CGU. Paper related impairments of EUR 22
million concerned News and Office CGUs. In 2021, mainly due to restructuring, Group company
disposal, impairment testing and further deterioration of certain paper-grade market due to
Covid-19 pandemic, total impairment charge of EUR 127 million was recognised in News,
Uncoated Mechanical and Office CGUs in the Paper division.
Goodwill impairments
In 2022 or 2021, the goodwill impairment testing did not result in any impairment. In 2022 and
due to upcoming disposals in the Paper division, goodwill impairment of EUR 11 million was
recognised in News and Office CGUs. In 2021 and due to Sachsen Mill disposal, goodwill
impairment of EUR 4 million was recognised in Paper - News CGU.
The most material groups of CGU s contai ning goodwill

| Year ended 31 December
| 2022 | 2021
EUR million | Goodwill at year end 2 | Pre-tax discount rate | Goodwill at year end | Pre-tax discount rate
Wood Products - Central Europe | 111 | 9.9% | 109 | 8.7%
Paper - Book Paper | 28 | 8.4% | 28 | 7.2%
Paper - Uncoated Mechanical | 12 | 8.4% | 40 | 7.2%
Biomaterials - Nordic and Innovation | 45 | 8.2% | 45 | 7.2%
Other CGUs 1 | 47 |  | 60 |
Total | 244 |  | 282 |
1 Other CGUs is including Packaging Solutions - Europe, Packaging Materials operations in Sweden, Packaging Materials - Containerboards, Wood Products - Northern Europe, Paper - News and Paper - Office cash generating units. 2 Goodwill excluding assets held for sale

The calculation of value in use is highly sensitive to discount rates, sales prices and costs.
Sensitivity analysis are conducted to calculate the amounts by which the value assigned to the
key assumption must change in order for the unit’s recoverable amount to be equal to its
carrying amount for the CGUs for which a reasonably possible change in an assumption could
result in an impairment. In 2022 any reasonably possible change in key assumptions would not
cause carrying amount to exceed its recoverable amount.

48
Summary of impairments and impairment reversals per division

| Year ended 31 December
EUR million | 2022 | 2021
Packaging Materials | 0 | 10
Packaging Solutions | 36 | 2
Biomaterials | 0 | 0
Wood Products | 10 | 0
Forest | 31 | 1
Paper | 33 | 131
Other | -4 | 4
Total (impairment +) / (Impairment reversal -) | 107 | 149

Note 11 Intangible assets, property, plant and equipment and right-
of-use assets
Accounting principles
Goodwill
Goodwill represents future economic benefits arising from assets that are not capable of being
individually identified and separately recognised by the Group on an acquisition. Goodwill is
computed as the excess of the cost of an acquisition over the fair value of the Group’s share of
the fair value of net assets of the acquired subsidiary at the acquisition date, and is allocated to
those groups of cash generating units expected to benefit from the acquisition. Goodwill arising
on the acquisition of non-euro foreign entities is treated as an asset of the foreign entity
denominated in the local currency and translated at the closing rate.
Goodwill is not amortised but tested for impairment on an annual basis, or more frequently if
there is an indication of impairment.
Other intangible assets
Intangible assets are stated at their historical cost and amortised on a straight-line basis over
their expected useful lives, which usually varies from 3 to 10 years and up to 20 years for
patents. An adjustment is made for any impairment. Intangible items acquired must be
recognised as assets separately from goodwill if they meet the definition of an asset, are either
separable or arise from contractual or other legal rights, and their fair value can be measured
reliably.
The cost of development or acquisition of new software clearly associated with an identifiable
and unique product that will be controlled by the Group and has a probable benefit exceeding its
cost beyond one year is recognised as an intangible asset and will be amortised over the
expected useful life of the software between 3 to 10 years.
Intangible assets recognised separately from goodwill in acquisitions consist of marketing and
customer-related or contract and technology-based intangible assets. Typical marketing and
customer-related assets include trademarks, trade names, service marks, collective marks,
certification marks, customer lists, order or production backlogs, customer contracts and the
related customer relationships. Contract and technology-based intangible assets are normally
licensing and royalty agreements or patented technology and trade secrets, such as confidential
formulas, processes or recipes. The fair value determination of customer contracts and related
relationships is derived from expected retention rates and cash flow over the customers’
remaining estimated lifetime. The value of trademarks is derived from a discounted cash flow
analysis using the relief from royalty method.
Property, plant and equipment
Property, plant and equipment acquired by Group companies are stated at their historical cost,
which are augmented where appropriate by asset retirement costs. Assets arising on the
acquisition of a new subsidiary are stated at fair value at the date of acquisition. Depreciation is
computed on a straight-line basis, and adjusted for any impairment and disposal charges. The
carrying amount represents the cost deducted by received grants and subsidies and less the
accumulated depreciation and any impairment charges. Interest costs on borrowings to finance
the construction of assets are capitalised as part of the cost during the construction period when
the requirements are fulfilled.
Land and water areas are not depreciated, as these are deemed to have an indefinite life, but
otherwise depreciation is based on the following expected useful lives:

Asset class | Depreciation years
Buildings, industrial | 10-50
Buildings, office & residential | 20-50
Groundwood mills | 15-20
Hydroelectric power | 40
Paper, board and pulp mills, main machines | 20-30
Heavy machinery | 10-20
Converting factories | 10-15
Sawmills | 10-15
Computers | 3-5
Vehicles | 5
Office equipment | 3-5
Railway, harbours | 20-25
Forest roads | 10-15
Roads, fields, bridges | 15-20

Ordinary maintenance and repair charges are written as expensed when incurred, but the costs
of significant renewals and improvements are capitalised and depreciated over the remaining
useful lives of the related assets. Retirements, sales and disposals of property, plant and
equipment are recorded by deducting the cost and accumulated depreciation from the
accounting records with any resulting terminal depreciation adjustments reflected in impairment
charges in the consolidated income statement. Capital gains are shown in other operating
income.
Spare parts are accounted for as property, plant and equipment if they are major and used
over more than one period, or if they are used only in connection with an item of property, plant
and equipment. In all other cases, spare parts are carried as part of the inventory and
recognised in profit or loss as consumed items.
Right-of-use (ROU) assets
At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right to control the use of an identified
asset for a period of time in exchange for consideration. ROU assets are initially measured at
cost, which comprises the initial amount of the lease liability adjusted mainly for lease payments
made at or before the commencement date. The Group allocates the consideration in the
49
contract to each lease component and will separate non-lease components if these are
identifiable. Lease terms are negotiated on an individual basis and contain a wide range of
different terms and conditions.
The ROU assets are subsequently depreciated using the straight line method from the
commencement date to the earlier of the end of the lease term or the end of the useful life of the
ROU asset. In addition, the ROU asset is adjusted for certain remeasurements of the lease
liability. ROU assets are tested for impairment in accordance with IAS 36.
The Group has elected not to recognise ROU assets for short-term leases that have a lease
term of 12 months or less and leases of low value assets. Leases of low value assets mainly
include IT and office equipment, certain vehicles and machinery and other low value items. The
Group recognises the lease payments associated with these leases as an expense on a straight-
line basis over the lease term (Note 5).
Intangible assets

| Year ended 31 December
EUR million | Computer software | Other intangible assets | Assets in progress | Goodwill | Total
Acquisition cost |  |  |  |  |
At 1 January 2021 | 233 | 98 | 17 | 695 | 1,044
Translation difference | 2 | 6 | 0 | 8 | 16
Reclassifications | 8 | 12 | -16 | 0 | 4
Additions | 6 | 5 | 6 | 0 | 17
Disposals | -23 | -19 | 0 | -171 | -213
At 31 December 2021 | 226 | 103 | 7 | 532 | 867
Translation difference | 0 | -1 | 0 | -2 | -4
Reclassifications | 5 | 2 | -4 | 0 | 3
Additions | 3 | 2 | 16 | 0 | 21
Disposals and classification as held for sale 1 | -11 | -6 | 0 | -28 | -46
At 31 December 2022 | 222 | 100 | 18 | 502 | 842
Accumulated amortisation and impairment |  |  |  |  |
At 1 January 2021 | 176 | 38 | 0 | 414 | 629
Translation difference | 1 | 4 | 0 | 3 | 8
Disposals | -22 | -19 | 0 | -171 | -212
Amortisation | 18 | 9 | 0 | 0 | 26
Impairment | 5 | 2 | 0 | 4 | 11
At 31 December 2021 | 178 | 34 | 0 | 250 | 462
Translation difference | 0 | 0 | 0 | -3 | -3
Disposals and classification as held for sale 1 | -11 | -6 | 0 | 0 | -17
Amortisation | 17 | 8 | 0 | 0 | 24
Impairment | 1 | 0 | 0 | 11 | 12
At 31 December 2022 | 185 | 35 | 0 | 258 | 478
Net Book Value at 31 December 2022 | 38 | 65 | 18 | 244 | 364
Net Book Value at 31 December 2021 | 48 | 69 | 7 | 282 | 405
1 Company disposals are included in Disposals line. Company disposals and classification of assets as held for sale are discussed in more detail in Note 4 Acquisitions, disposals and assets held for sale.

Property, plant and equipment

| Year ended 31 December
EUR million | Land and water | Buildings and structures | Plant and equipment | Other tangible assets | Assets in progress | Total
Acquisition cost |  |  |  |  |  |
At 1 January 2021 | 128 | 3,301 | 13,256 | 455 | 549 | 17,690
Translation difference | 0 | 64 | 48 | 0 | 1 | 114
Reclassifications | 2 | 58 | 405 | 11 | -480 | -4
Reclassifications to biological assets | 0 | -1 | -1 | 0 | 0 | -2
Additions | 0 | 15 | 214 | 1 | 328 | 558
Disposals | -13 | -82 | -503 | -19 | -4 | -620
At 31 December 2021 | 117 | 3,355 | 13,421 | 448 | 394 | 17,735
Translation difference | -1 | -12 | -266 | -11 | -10 | -300
Reclassifications | 0 | 57 | 207 | 10 | -277 | -3
Reclassifications to biological assets | 0 | -2 | -1 | 0 | 0 | -3
Additions | 6 | 33 | 217 | 4 | 373 | 634
Disposals and classification as held for sale 1 | -19 | -390 | -2,668 | -58 | -27 | -3,162
At 31 December 2022 | 103 | 3,041 | 10,909 | 393 | 454 | 14,900
Accumulated depreciation and impairment |  |  |  |
At 1 January 2021 | 3 | 2,096 | 10,186 | 386 | 11 | 12,683
Translation difference | 0 | 9 | -30 | 0 | 1 | -20
Disposals | -1 | -79 | -487 | -19 | 0 | -586
Depreciation | 0 | 77 | 373 | 11 | 0 | 461
Impairments and reversals | 0 | 10 | 125 | 2 | 0 | 137
At 31 December 2021 | 3 | 2,113 | 10,164 | 380 | 14 | 12,674
Translation difference | 0 | -30 | -262 | -9 | 0 | -302
Disposals and classification as held for sale 1 | -1 | -378 | -2,458 | -49 | 0 | -2,886
Depreciation | 0 | 78 | 371 | 10 | 1 | 460
Impairments and reversals | 0 | 21 | 68 | 4 | 2 | 95
At 31 December 2022 | 2 | 1,804 | 7,882 | 336 | 16 | 10,040
Net Book Value at 31 December 2022 | 101 | 1,237 | 3,027 | 57 | 437 | 4,860
Net Book Value at 31 December 2021 | 114 | 1,242 | 3,256 | 68 | 380 | 5,060
1 Company disposals are included in the Disposals line. Company disposals and classification of assets as held for sale are discussed in more detail in Note 4 Acquisitions, disposals and assets held for sale.

50
Right-of-use assets

| Year ended 31 December
EUR million | Land and water | Forest land | Buildings and structures | Plant and equipment and other | Total
Acquisition cost |  |  |  |  |
At 1 January 2021 | 99 | 233 | 97 | 148 | 577
Translation difference | 9 | 26 | 1 | 1 | 37
Reclassifications to biological assets | 0 | -15 | 0 | 0 | -15
Additions | 0 | 9 | 9 | 15 | 33
Disposals | -1 | 0 | -4 | -37 | -42
Other changes | 0 | 0 | 1 | 0 | 1
At 31 December 2021 | 107 | 253 | 104 | 127 | 591
Translation difference | -2 | -2 | -3 | -1 | -7
Reclassifications to biological assets | 0 | -17 | 0 | 0 | -17
Additions | 1 | 6 | 20 | 18 | 45
Disposals and classification as held for sale 1 | -2 | 0 | -23 | -36 | -62
Other changes | 1 | 2 | 0 | 4 | 6
At 31 December 2022 | 105 | 243 | 96 | 113 | 556
Accumulated depreciation and impairment |  |  |  |  |
At 1 January 2021 | 6 | 12 | 38 | 70 | 125
Translation difference | 1 | 2 | 1 | 0 | 3
Disposals | -1 | 0 | -4 | -36 | -41
Depreciation | 3 | 5 | 20 | 34 | 62
Impairment | 0 | 0 | 0 | 1 | 1
At 31 December 2021 | 8 | 18 | 55 | 69 | 150
Translation difference | 0 | -1 | -2 | -1 | -4
Disposals and classification as held for sale 1 | -1 | 0 | -23 | -34 | -58
Depreciation | 3 | 5 | 19 | 23 | 50
Impairment | 0 | 0 | 1 | 0 | 0
At 31 December 2022 | 10 | 22 | 49 | 56 | 138
Net Book Value at 31 December 2022 | 95 | 221 | 47 | 57 | 418
Net Book Value at 31 December 2021 | 99 | 235 | 49 | 59 | 441
1 Company disposals are included in the Disposals line. Company disposals and classification of assets as held for sale are discussed in more detail in Note 4 Acquisitions, disposals and assets held for sale.

Stora Enso’s most material right-of-use assets capitalised consist of land areas used in forestry
and industrial operations, various machinery and equipment leases including operative
machinery and logistic equipment, as well as properties including offices, warehouses and other
operative properties. Some of the leases contain renewal options and extension options that are
considered in the lease term if the Group is reasonably certain to exercise the option.
See Note 26 Interest-bearing assets and liabilities for more details about lease liabilities and
Note 5 Other operating income and expense for details about lease expenses included in the
income statement.
Intangible assets and property, plant and equipment,
and right-of-use asset additions
The total capital expenditure excluding investments in biological assets for the year amounted to
EUR 701 (E UR 609) million. Details of ongoing projects and future plans are discussed in more
detail in the Report of the Board of Directors.
Note 12 Forest assets
Accounting principles
T he forest assets of Stora Enso are defined as standing growing trees, classified as biological
assets, and related forest land. The biological assets of Stora Enso consist of standing trees to
be used as raw material in pulp and mechanical wood production and as biofuels.
Forest asset valuation is based on continuous operations and sustainable forest
management, also taking into consideration environmental restrictions and other reservations.
Biological assets are recognised and valued in accordance with the IAS 41 Agriculture standard
at fair value and forest land assets are recognised in accordance with the IAS 16 Property, plant
and equipment standard. Leased forest land assets are presented as part of right-of-use assets
in Note 11 Intangible assets, property, plant and equipment, and right-of-use assets. The Group
changed its valuation method related to Finnish forest asset valuation at the end of 2022 to
correspond to the valuation method applied with Swedish forest assets, as explained in Note 1
Accounting principles.
Nordic and plantation forest assets are classified as different classes of assets due to
different nature, usage and characteristics of the assets. The main difference is the short-term
growing cycle of 6–12 years in plantations versus the long-term growing cycle of 60-100 years in
Nordic forests. There are also differences in regeneration methods, forest management, and the
use of the assets for other purposes.
Nordic forest assets include holdings in Sweden and Finland and plantation forest assets
include holdings in China, Brazil and Uruguay. Accounting policies for the different class of forest
assets are presented separately below. In addition the Group has minor forest asset holdings in
Estonia and Romania through associate company Tornator. The Group has forest assets in its
own subsidiaries in Sweden and China as well as in joint operations in Brazil and Uruguay, and
in equity accounted investment in Finland. Stora Enso also ensures that the Group’s share of the
valuation of forest holdings in equity accounted investments and joint operations are consistent
with Group accounting policies. At harvesting, biological assets are transferred to the inventory.
Nordic forest assets
Forest assets in Sweden and Finland are recognised at fair value and valued by using a market
approach method on the basis of the forest market transactions in the areas where Stora Enso’s
forests are located. Stora Enso’s forest assets create value by securing wood supply, increasing
long-term yield, optimising land use and securing financial flexibility. They play an important role
in mitigating climate change impacts, as growing trees absorb CO 2. The forests also offer
opportunities for future value streams, such as wind power.
The total forest assets value is calculated with verified inventory data and regional standing
stock prices, considering among others:
•regional market transaction data based on the forest assets' geographical locations,
•standing stock prices by forest cubic meter (m 3 fo) combined from traded forest estates and
•regional standing stock inventory.
51
Information relating to forest asset transactions are available from market data suppliers. The
market transaction information can be viewed as market-corroborated inputs. Certain
adjustments are made to refine the market-corroborated inputs using unobservable inputs,
therefore inputs are categorised to fair value hierarchy measurement level 3. The judgements
are further explained in Note 2 Critical accounting estimates and judgements.
The total value of the forest assets in Nordics is allocated across biological assets and forest
land. Allocation of the combined fair value of forest assets is based on the income approach
where separate present values of expected net cash flows are calculated for both biological
assets and forest land. The discount rate is determined as the rate at which the valuation based
on market transaction prices matches the total forest assets combined cash flows for biological
assets and forest land. The discount rate is estimated to be the same for biological assets and
forest land as the nature and timing of the cash flows are similar.
Biological assets are measured at fair value in accordance IAS 41. The fair value is based on
the income approach and the discounted cash flow method whereby the fair value of the
biological assets is calculated using cash flows from continuous operations, taking into account
the growth potential of one cycle. Forest land is measured at fair value using the revaluation
method as defined in the IAS 16 standard. Fair value of forest land is measured based on
income approach, including net cash flows related to trees to-be-planted in the future as well as
other land related income, such as hunting rights, wind power leases and soil material sale s.
Changes in the fair value of biological assets are recognised in the income statement.
Changes in the fair value of forest land, net of deferred taxes, are recognised in other
comprehensive income (OCI) and accumulated in a revaluation reserve in equity. Revaluation
reserve is not recycled to the income statement upon disposal. If the fair value of forest land
were to be less than cost, the difference would be recognised in the income statement as an
impairment loss.
Plantation forest assets
In plantation forest areas, biological assets are recognised at fair value in accordance with the
IAS 41 standard and based on the income approach in those areas where the Group has forest
land. Fair value measurement is based on fair value hierarchy measurement level 3. Forest land
is measured initially and subsequently at cost, using the cost model as defined in IAS 16
standard.
The valuation of biological assets is based on the discounted cash flow method calculated
using cash flows from continuous operations and based on sustainable forest management,
taking into account growth potential of one cycle. The fair value of the biological assets is based
on the productive forest land. The yearly harvest from the forecasted tree growth is multiplied by
wood prices and the cost of silviculture and harvesting is deducted. The fair value of the
biological assets is measured as the present value of the harvest from one growth cycle, taking
into consideration environmental restrictions and other reservations. The discount rate applied is
determined using the weighted average cost of capital method.
Young standing timber less than two years old (less than three years in Montes del Plata) is
considered to be an immature asset and accounted at cost. Fair value is deemed to approximate
the cost when little biological transformation has taken place or the impact of the transformation
on the price is not expected to be significant, which varies according to the location and species
of the assets.
Changes in the fair value of biological assets are recognised in the income statement. The
forest land is measured at cost and not depreciated.
The value of forest assets disclosed in the consolidated statement of financial position from
subsidiary companies and joint operations amounts to EUR 6,846 (EUR 6,747) million as shown
below. The Group’s indirect share of forest assets held by associated company amounts to EUR
1,271 (EUR 985) million. The total forest asset value, excluding leased forest land, amounts to
EUR 8,117 (EUR 7,732) million.
Forest assets

| Biological assets | Forest land 2 | Forest assets total
| Year Ended 31 December | Year Ended 31 December | Year Ended 31 December
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Subsidiaries and joint operations |  |  |  |  |  |
Value at 1 January | 4,547 | 4,250 | 2,201 | 2,005 | 6,747 | 6,256
Translation differences | -305 | -43 | -145 | -26 | -449 | -68
Unrealized change in fair value 1 | 336 | 471 | 259 | 225 | 596 | 696
Additions | 77 | 58 | 2 | 1 | 78 | 59
Disposals | -2 | -64 | -2 | -5 | -4 | -69
Change due to harvesting 1 | -141 | -127 | 0 | 0 | -141 | -127
Other operative changes 1 | -1 | -17 | 0 | 0 | -1 | -17
Reclassification from PPE | 20 | 17 | 0 | 0 | 20 | 17
Value at 31 December | 4,531 | 4,547 | 2,315 | 2,201 | 6,846 | 6,747
Associated company |  |  |  |  |  |
Tornator Oyj (41%) | 1,122 | 906 | 149 | 78 | 1,271 | 985
Value at 31 December | 1,122 | 906 | 149 | 78 | 1,271 | 985
Total | 5,653 | 5,453 | 2,464 | 2,279 | 8,117 | 7,732
1 For biological assets, changes are presented in the profit and loss. For forest land, changes in fair value are recognised directly in equity. 2 Not including leased forest land.

52
Valuation and standing stock of forest assets

|  |  | As at 31 December 2022 |
|  |  | Swedish forests | Guangxi | Veracel (50%) | MdP (50%) | Tornator (41%) | Total
Total area |  | Thousand ha | 1,389 | 73 | 113 | 138 | 301 | 2,014
- of which owned |  | Thousand ha | 1,389 | — | 105 | 95 | 300 | 1,890
- of which leased |  | Thousand ha | — | 73 | 8 | 43 | — | 124
Productive area |  | Thousand ha | 1,142 | 64 | 47 | 92 | 277 | 1,622
Total area | Standing stock | million m 3 fo.1 | 152.7 | 4.2 | 5.2 | 15.5 | 33.2 | 210.8
Productive area | Standing stock | million m 3 fo.1 | 150.5 | 4.1 | 5.2 | 15.5 | 32.8 | 208.1
| Estimated growth | million m 3 fo.1 | 5.8 | 1.3 | 1.8 | 3.2 | 1.5 | 13.6
| Harvesting | million m 3 fo.1 | 4.6 | 1.2 | 1.7 | 1.8 | 1.3 | 10.7
| Other changes | million m 3 fo.1 | -1.1 | -0.8 | 0.0 | 0.2 | -0.1 | -1.8
| Harvesting | million m 3 u.b.2 | 3.8 | 1.0 | 1.4 | 1.5 | 1.2 | 8.9
Biological assets |  | EUR million | 3,963 | 196 | 103 | 269 | 1,122 | 5,653
Biological assets | Productive area | EUR/ha | 3,471 | 3,062 | 2,162 | 2,922 | 4,054 | 3,485
Forest land |  | EUR million | 2,113 | — | 29 | 173 | 149 | 2,464
Total forest assets | EUR million | 6,076 | 196 | 131 | 441 | 1,271 | 8,117
Leased forest land | EUR million | — | 166 | 3 | 52 | — | 221
1 Forest cubic meters 2 Solid under bark (sub) cubic meters

|  |  | As at 31 December 2021 |
|  |  | Swedish forests | Guangxi | Veracel (50%) | MdP (50%) | Tornator (41%) | Total
Total area |  | Thousand ha | 1,389 | 77 | 113 | 136 | 295 | 2,009
- of which owned |  | Thousand ha | 1,389 | — | 106 | 95 | 295 | 1,884
- of which leased |  | Thousand ha | — | 77 | 7 | 41 | — | 125
Productive area |  | Thousand ha | 1,141 | 68 | 47 | 90 | 271 | 1,617
Total area | Standing stock | million m 3 fo.1 | 152.6 | 5.0 | 5.0 | 13.9 | 33.0 | 209.5
Productive area | Standing stock | million m 3 fo.1 | 150.5 | 4.9 | 5.0 | 13.9 | 32.7 | 207.1
| Estimated growth | million m 3 fo.1 | 5.8 | 1.6 | 1.8 | 2.6 | 1.4 | 13.2
| Harvesting | million m 3 fo.1 | 4.4 | 1.3 | 1.2 | 1.6 | 1.3 | 9.9
| Other changes | million m 3 fo.1 | 6.2 | 0.4 | 0.0 | -0.1 | 1.2 | 7.7
| Harvesting | million m 3 u.b.2 | 3.7 | 1.0 | 1.0 | 1.3 | 1.2 | 8.2
Biological assets |  | EUR million | 4,005 | 200 | 81 | 260 | 906 | 5,453
Biological assets | Productive area | EUR/ha | 3,511 | 2,950 | 1,713 | 2,900 | 3,342 | 3,372
Forest land |  | EUR million | 2,012 | — | 26 | 163 | 78 | 2,279
Total forest assets | EUR million | 6,017 | 200 | 107 | 423 | 985 | 7,732
Leased forest land | EUR million | — | 187 | 2 | 45 | — | 235
1 Forest cubic meters 2 Solid under bark (sub) cubic meters

Subsidiaries and joint operations
At the end of 2022, forest assets (excluding leases) were located by value, in Sweden 89%
(89%), China 3% (3%), Brazil 2% (2%) and Uruguay 6% (6%). The total area amounts to 1,713
(1,715) thousand hectares of which 7% (7%) is leased and under 1% (1%) is restricted. From
Stora Enso's total forest holdings 1,345 (1,346) thousand hectares is productive forest area. The
Montes del Plata and Veracel amounts take into account the ownership share.
Swedish forests
At the end of 2022, the value of the biological assets in Swedish forests amounted to EUR 3,963
(EUR 4,005) million, related forest land amounted to EUR 2,113 (EUR 2,012) million and the
total forest assets amounted to EUR 6,076 (EUR 6,017) million. The value increase in the forest
assets value is mainly driven by higher market prices, whereas foreign exchange impact netted
the impact of price increases and decreased the value with approximately EUR 485 million.
Deferred tax liabilities related to forest assets amounted to EUR 1,250 (EUR 1,237) million. The
discount rate of 3.6% (3.5%) was applied in the valuation.
The productive area in Swedish forests amounted to 1,142 (1,141) thousand hectares with a
standing stock of 150.5 (150.5) million forest m 3. The weighted three-year average market
transaction price applied in the valuation for Swedish forests assets in 2022 is EUR 40 (EUR 40)
per forest m 3. The forest asset value corresponds to an average of EUR 5,320 (EUR 5,270) per
ha of productive forest area.
The valuation of the forest assets is based on detailed transaction data and price statistics as
provided by different market data suppliers. Market transaction data is adjusted to consider the
characteristics and nature of Stora Enso's forest assets and to exclude certain non-forest assets
and outliers. The valuation takes into account where the forest land is located, price levels and
volume of standing stock. Market prices between areas varies significantly. Future changes in
value of Swedish forest assets are impacted by changes in market transaction prices and
changes in volume of standing stock, considering growth and other changes. See also Note 2 for
information related estimates and judgment applied in the valuation.
Forest asset location and volume

2022 |  | North | Middle | South | Total
Productive area | Thousand ha | 190 | 951 | 0 | 1,142
Percentage of total | % | 17% | 83% | 0% | 100%
Standing stock | million m 3 fo. | 17.5 | 133.0 | 0.0 | 150.5
Percentage of total | % | 12% | 88% | 0% | 100%

2021 |  | North | Middle | South | Total
Productive area | Thousand ha | 191 | 950 | 0 | 1,141
Percentage of total | % | 17% | 83% | 0% | 100%
Standing stock | million m 3 fo. | 17.1 | 133.3 | 0.0 | 150.5
Percentage of total | % | 11% | 89% | —% | 100%

Guangxi
At the end of 2022, the value of the biological assets in Guangxi, China, amounted to EUR 196
(EUR 200) million. All the forest land in China is leased. The value decrease is mainly driven by
foreign exchange impact and increased discount rate, whereas higher prices increased the
value. The biological assets included young standing timber with a value of EUR 27 (EUR 33)
million. The discount rate of 10.2% (8.6%) used in the discounted cash flows (DCF) increased in
2022. The productive forest area in Guangxi totals to 64 (68) thousand hectares with a standing
stock of 4.1 (4.9) million forest m 3.
Veracel
Veracel is a 50% joint operation in Brazil. Stora Enso’s share of the biological assets was EUR
103 (EUR 81) million. The increase is mainly driven by increased prices and foreign exchange
impact, whereas increased discount rate and higher costs decreased the value. The biological
53
assets included young standing timber with a value of EUR 31 (EUR 21) million. The discount
rate of 7.9% (6.9%) used in the DCF increased in 2022. The related forest land is measured at
cost. Stora Enso’s share of the productive forest area totals to 47 (47) thousand hectares with a
standing stock of 5.2 (5.0) million forest m 3.
Montes del Plata
Montes del Plata (MdP) is a 50% joint operation in Uruguay. Stora Enso’s share of the biological
assets was EUR 269 (EUR 260) million. The movement is mainly driven by foreign exchange
impact and discount rate change. The biological assets included young standing timber with a
value of EUR 50 (EUR 46) million. The discount rate of 9.0% (6.5%) used in the DCF increased
in 2022. The related forest land is measured at cost. Stora Enso’s share of the productive forest
area totals to 92 (90) thousand hectares with a standing stock of 15.5 (13.9) million forest m 3.
Associated company
Tornator
Tornator Oyj is a 41% owned Finnish associate company. Stora Enso’s share of the biological
assets was EUR 1,122 (EUR 906) million, related forest land amounted to EUR 149 (EUR 78)
million, and total forest assets equalled to EUR 1,271 (EUR 985) million. The increase in the
value of forest assets is mainly driven by moving to market transaction based valuation method
from discounted cash flow based method concerning forest assets in Finland. Acquisitions also
increased the forest asset value. See Note 1 for more details related to changes in the valuation
method.
Stora Enso’s share of the productive forest area totals to 277 (271) thousand hectares with a
standing stock of 32.8 (32.7) million forest m3. The weighted three-year average market
transaction price applied in the valuation for forest assets located in Finland in 2022 is EUR 42
per forest m 3. The forest asset value in Finland corresponds to an average of EUR 4,750 per ha
of productive forest area.
Valuation sensitivities of significant assumptions of a +/- 10% movement

EUR million | Wood market prices | Growth rate | Discount rate
Guangxi | +/-28 | +/-1 | +/-4
Veracel | +/-10 | +/-10 | +/-2
Montes del Plata | +/-30 | +/-30 | +11/-10

Swedish forest asset valuation is sensitive for changes in market transaction prices and volume
of standing stock. A change in the average market price of forest assets of EUR 1 per forest m 3
would impact the value of forest assets by EUR 151 (EUR 150) million. A change in the volume
of standing stock of 1 million forest m 3 would impact the value of forest assets by EUR 40 (EUR
40) million.
Note 13 Equity accounted investments
Accounting principles
Associated companies over which Stora Enso exercises significant influence are accounted for
using the equity method. Stora Enso does not control associate companies alone or jointly with
other parties, but has significant influence. The Group’s share of the equity accounted
investment profit or loss is recognised in the consolidated income statement. The Group’s
interest in an associated company is carried in the consolidated statement of financial position at
an amount that reflects its share of the net assets of the associate together with goodwill.
Goodwill arising from the acquisition of an equity accounted investment is included in the
carrying amount of the investment and is assessed for impairment as part of that investment.
There is no material goodwill in the carrying amount of equity accounted investments.
When the Group share of losses exceeds the carrying amount of an investment, the carrying
amount is reduced to zero and any recognition of further losses ceases unless the Group is
obliged to satisfy obligations of the investee that it has guaranteed or which it is otherwise
committed to.
The Group’s share of results in equity accounted investments is reported in the operating
profit to reflect the operational nature of these investments. Similarly, dividends received from
equity accounted investments are presented in the net cash provided by operating activities in
the consolidated cash flow statement.
Principal equity accounted investments

|  |  | As at 31 December
|  |  | Ownership interest % | EUR million
Company | Reportable segment | Domicile and principal place of operations | 2022 | 2021 | 2022 | 2021
Tornator Oyj | Forest | Finland | 41.00 | 41.00 | 800 | 545
Others |  |  |  |  | 32 | 35
Carrying amount |  |  |  |  | 832 | 580

In 2022, Stora Enso divested its 30.41% participation in Encore Ympäristöpalvelut Oy. The
transaction did not have a material impact on the Group.
In 2021 Stora Enso's 20% ownership in Arauco Florestal Arapoti S.A. was divested. The
transaction did not have a material impact on the Group. Also in 2021, Bergvik Skog AB was
liquidated, there were no operations remaining in the company after Bergvik Skog AB
restructuring in 2019.
54
Group share of equity accounted investments income statements

| Year Ended 31 December
EUR million | 2022 | 2021
Sales | 147 | 142
Net operating expenses | -103 | -97
Biological asset valuation | 189 | 120
Operating profit | 233 | 166
Net financial items | 40 | 10
Net profit before tax | 273 | 176
Income tax | -52 | -34
Net profit for the year | 221 | 143

The average number of personnel in the equity accounted investments was 1,043 in 2022,
compared with 1,193 in 2021.
A summary of the financial information, prepared in accordance IFRS, in respect of the
Group’s material associate, Tornator Oyj is set out below. The Group’s share of Tornator Oyj is
reported in the Forest division and covers the majority of the Group’s total carrying amount of
equity accounted investments.
Tornator Oyj

EUR million | 2022 | 2021
Forest Assets | 3,101 | 2,401
Other non-current assets | 70 | 39
Current assets | 73 | 53
Non-current liabilities | 752 | 821
Current liabilities | 120 | 43
Tax liabilities | 420 | 300
Sales | 176 | 155
Net profit for the year | 542 | 349
Other comprehensive income | 141 | 39
Total comprehensive income | 683 | 388
Dividends received during the financial year | 25 | 16
Net assets of the associate | 1,952 | 1,329
Ownership interest | 41.00% | 41.00%
Carrying amount of the Group's interest in Tornator Oyj | 800 | 545

The Group’s current 41% ownership is valued at EUR 800 (EUR 545) million at the year-end of
2022. The Group’s share of Tornator’s net profit was EUR 222 (EUR 143) million, including a
biological asset valuation gain net of taxes of EUR 152 (EUR 96) million.
Aggregate information of equity accounted investments that are not individually material

| As at 31 December
EUR million | 2022 | 2021
Non-current assets | 35 | 30
Current assets | 12 | 22
Non-current liabilities | 3 | 2
Current liabilities | 12 | 15
Sales | 74 | 78
Net profit for the year | -2 | 0
Dividends received during the financial year | 1 | 0
Net assets of the associates | 32 | 35
Equity accounting value | 32 | 35
Equity accounting value for Tornator Oyj | 800 | 545
Total equity accounting value | 832 | 580

Equity accounted investment balances

| As at 31 December
EUR million | 2022 | 2021
Receivables from equity accounted investments |  |
Non-current loan receivables | 2 | 2
Trade receivables | 1 | 1
Other receivables | 0 | 10
Liabilities due to equity accounted investments |  |
Trade payables | 101 | 55

Equity accounted investment transactions

| Year Ended 31 December
EUR million | 2022 | 2021
Sales to equity accounted investments | 19 | 19
Interest on loan receivables from equity accounted investments | 0 | 1
Purchases from equity accounted investments | 163 | 109

The Group engages in transactions with equity accounted investments such as sales and
purchases of wood. All agreements are negotiated at arm’s length and are conducted on terms
that the Group considers customary in the industry and generally no less favourable than would
be available from independent third parties.
55
Note 14 Equity instruments
Accounting principles
The Group has elected to classify its equity investments in Pohjolan Voima shares and certain
listed shares held by the Group at fair value through other comprehensive income (FVTOCI)
under IFRS 9 by applying the irrevocable election for equity instruments under the standard due
to the long-term nature of the ownership. The gains and losses resulting from changes in the fair
value of equity investments under FVTOCI are not recycled to the Income Statement upon
impairment or disposal, only the dividend income is recognised in the income statement. In
addition, the Group also has certain equity investments in unlisted securities that are classified
as fair value through income statement.
Summary of values

| Year Ended 31 December
EUR million | 2022 | 2021
Acquisition cost at 1 January |  |
Listed securities | 3 | 3
Unlisted securities | 135 | 135
Investments classified as equity instruments | 139 | 138
OCI in opening balance | 779 | 279
Equity Instruments at 1 January | 918 | 417
Translation difference and other | -2 | 0
Additions | 10 | 1
Change in fair values accounted for as OCI | 519 | 501
Carrying amount at 31 December | 1,445 | 918

Unrealised gains and losses on listed and unlisted securities

| Year Ended 31 December
EUR million | 2022 | 2021
Net unrealised holding gains (OCI) | 1,299 | 780
Cost | 147 | 139
Fair value | 1,445 | 918
Net unrealised holding gains (OCI) | 1,299 | 780
Deferred tax | -1 | -2
Net unrealised holding gains shown in equity as OCI | 1,297 | 778
Change in net unrealised holding gains shown in equity as OCI | 519 | 501

PVO shares
The Group holds a 15.6% (15.6%) interest in Pohjolan Voima Oyj (PVO), a public limited
company in the energy sector that produces electricity and heat for its shareholders in Finland at
cost-based and non-profit making principle (Mankala-principle). Each subsidiary of the PVO
group has its own class of shares that, instead of dividends, entitle the shareholder to the energy
produced in proportion to its ownership of that class of share. Also, the shareholders then have
an obligation to cover the costs of production, which are generally lower than market prices.
Stora Enso did not receive actual dividend payments from PVO during 2022. The holding is fair
valued quarterly using the discounted cash flow method. During the l ast quarter of 2022 the
Group refined the valuation method to be based on discounted cash flow analysis only, while
previously, also market multiples were used. Trading multiples are considered to be less reliable
under current market conditions. The valuation is categorised at level 3 in the fair value
hierarchy according to IFRS 13; levels are explained in Note 25 Fair values.
The electricity prices used in the valuation are based on market future derivative prices for
the first three years and on long-term electricity price estimates for the years thereafter. The
historical financial statements provide the basis for the cost structure for each power asset and
for future periods, estimates from PVO shareholder information is used when available and
these are adjusted by inflation factor in future years. The discount rate of 7.99% used in the
valuation model is determined using the weighted average cost of capital method. A +/- 5%
change in the electricity price used in the DCF would change the valuation by EUR +127 million
and -127 million, respectively. A +/- percentage point change in the discount rate would change
the valuation by EUR -158 million and +200 million, respectively..
Stora Enso holds an indirect share of approximately 8.9% of the capacity of Olkiluoto 3
nuclear plant unit through its PVO B2 shares. The Olkiluoto 3 plant unit has been running test
production during 2022. During the test production, in October 2022, damages were identified in
the plant unit's feedwater pumps. After an investigation into the damages, Teollisuuden Voima
Oyj announced in December 2022 that the regular electricity production is expected to start in
March 2023.
PVO shareholding on 31 December 2022

EUR million | Share Series | % Holding | Asset Category | Fair Value 2022 | Fair Value 2021
PVO-Vesivoima Oy | A | 20.6 | Hydro | 307 | 302
Teollisuuden Voima Oyj | B | 15.7 | Nuclear | 735 | 540
Teollisuuden Voima Oyj | B2 | 14.8 | Nuclear | 377 | 54
Other | C,C2,V,M | Various | Various | 4 | 4
Total |  |  |  | 1,423 | 900

The valuation in 2022 amounted to EUR 1,423 (EUR 900) million against a cost value of EUR
130 (EUR 130) million, with the revaluation of EUR 1,293 (EUR 770) million presented in equity
as part of the fair value reserve. The change in PVO’s value is mainly caused by the increase in
electricity market prices during the year. No deferred tax is recognized, as under Finnish tax
regulations holdings above 10% are exempt from tax on disposal proceeds.
Principal equity instruments

| 31 December 2022
EUR million | Holding % | Number of Shares | Acquisition Cost | Fair Value
Packages Ltd, Pakistan - listed shares | 6.0 | 5,396,650 | 3 | 8
Total listed securities |  |  | 3 | 8
Pohjolan Voima Oy - unlisted shares | 15.6 | 5,073,972 | 130 | 1,423
Others - unlisted securities |  |  | 14 | 14
Total unlisted securities |  |  | 144 | 1,437
Total Equity instruments at 31 December 2022 |  |  | 147 | 1,445
Total Equity instruments at 31 December 2021 |  |  | 139 | 918

56
Note 15 Emission rights and other non-current assets
Accounting principles
The Group participates in the European Emissions Trading Scheme, with the aim of reducing
greenhouse gas emissions. The Group has been allocated allowances to emit a fixed tonnage of
carbon dioxide (CO 2) over a fixed period of time, which are recognised as intangible assets,
government grants and as liabilities for the obligation to deliver allowances equal to those
emissions that have been made during the compliance period.
Intangible assets related to emission allowances are measured at level 1 fair value at the
date of initial recognition. The liabilities to deliver allowances are recognised based on actual
emissions and are settled using allowances on hand and measured at the carrying amount of
those allowances. At the reporting date, if the market value for the emission allowances is less
than the carrying amount, any surplus allowances that are not required to cover emissions made
are impaired to the market value.
The Group expenses emissions made at the grant date fair value, under materials and
services, together with purchased emission rights at their purchase price. Such costs will be
offset under other operating income by the income from the original rights used at their grant
date fair value. The consolidated income statement will, thus, be neutral in respect to all the
rights consumed that were within the original grant of rights. Sales of excess emission
allowances are recognised as income on the delivery date. Any net effect represents the costs of
purchasing additional rights to cover excess emissions, or the sale of unused rights in case that
the realised emissions are below the allowances received free of charge or the impairment of
allowances that are not required for own use.
Emission rights

| Year Ended 31 December
EUR million | 2022 | 2021
Value on 1 January | 137 | 36
Emission allowances allocated | 160 | 167
Sales | -62 | -35
Settlement with the government | -85 | -31
Classification as held for sale | -27 | 0
Value on 31 December | 123 | 137

The liability to deliver allowances is presented in the consolidated statement of financial position
in line other operative liabilities. As of 31 December 2022, the liability to deliver allowances
amounted to EUR 91 (EUR 99) million as presented in Note 23 Other liabilities. The excess
emission rights held at the year end were valued at EUR 32 (EUR 38) million.
Other non-current assets

| As at 31 December
EUR million | 2022 | 2021
Prepaid expenses and accrued income | 22 | 15
Tax credit | 4 | 3
Other non-current operative assets | 12 | 15
Total | 38 | 34

Note 16 Inventories
Accounting principles
Inventories are reported at lower of cost and net realisable value with the cost determined by the
first-in first-out (FIFO) method or, alternatively, by the weighted average cost where it
approximates FIFO. The same cost formula is used for all inventories having a similar nature
and use to the Group. The cost of finished goods and work in progress comprises raw material,
direct labour, depreciation, other direct costs and related production overheads, but excludes
interest expenses. Net realisable value is the estimated selling price in the ordinary course of
business, less the costs of completion and sale.
Where market conditions result in the manufacturing costs of a product exceeding its net
realisable value, a valuation allowance is made. Valuation allowances are also made for old,
slow moving and obsolete finished goods and spare parts when needed. Such valuation
allowances are deducted from the carrying value of the inventories in the consolidated statement
of financial position.

| As at 31 December
EUR million | 2022 | 2021
Materials and supplies | 501 | 422
Work in progress | 84 | 97
Finished goods | 962 | 689
Spare parts and consumables | 337 | 331
Other inventories | 25 | 23
Advance payments and cutting rights | 63 | 55
Obsolescence allowance - spare parts and consumables | -103 | -125
Obsolescence allowance - finished goods | -19 | -9
Net realisable value allowance | -40 | -5
Total | 1,810 | 1,478

EUR 6,576 (EUR 5,740) million of inventories in total have been expensed during the year. EUR
78 (EUR 29) million of inventory write-downs have been recognised as an expense. EUR 9
(EUR 16) million have been recognised as a reversal of previous write-downs.
57
Note 17 Operative receivables
Accounting principles
Trade receivables
Trade receivables are recognised initially at fair value and subsequently at their anticipated
realisable value with an estimate made for loss allowance on expected credit losses based on a
forward-looking and objective review of all outstanding amounts at period end. A simplified
approach under IFRS 9 has been implemented for trade receivables and loss allowances are
recognised based on expected lifetime credit losses in the consolidated income statement within
other operating expenses. For non-defaulted receivables, expected credit losses are estimated
based on externally generated customer level probability of default data that is used in the
forward-looking loss allowance calculation model. The loss allowance model for non-defaulted
receivables also takes into account a macroeconomic indicator that considers the
macroeconomic developments and further incorporates forward-looking data to the calculation
model. The rebuttable presumption that default does not occur later than when a financial asset
is 90 days past due has been applied in the calculation model and a default is normally
estimated to occur when trade receivables are at least 90 days overdue or there is otherwise
objective evidence supporting the conclusion that a default has occurred. Trade receivables will
be written off and booked as a credit loss only with the court's decision of bankruptcy or in some
other cases when there is objective evidence supporting the write-off. Trade receivables are
presented in current assets under operative receivables in the consolidated statement of
financial position.
Trade receivables under factoring arrangements
Stora Enso uses factoring arrangements as one of the working capital management tools. Sold
trade receivables are derecognised once significant related risks and rewards of ownership have
been transferred to the buyer. Outstanding balances for trade receivables that were not yet sold
at period end but qualify to be sold under factoring programmes in the next period, are classified
as trade receivables fair valued through other comprehensive income in accordance with the
business model and contractual cash flow characteristics tests under IFRS 9. Please refer to
Note 25 Fair values for further details.
Current operative receivables

| As at 31 December
EUR million | 2022 | 2021
Trade receivables - gross carrying amount before amount held for sale | 1,329 | 1,175
Trade receivables - gross carrying amount held for sale | -92 | 0
Trade receivables - gross carrying amount | 1,236 | 1,175
Loss allowance | -32 | -26
Prepaid expenses and accrued income | 68 | 82
Other receivables | 200 | 218
Total | 1,473 | 1,449

Age analysis of trade receivables

| As at 31 December
EUR million | 2022 | 2021
Not overdue | 1,213 | 1,093
Less than 30 days overdue | 55 | 38
31 to 60 days overdue | 10 | 7
61 to 90 days overdue | 2 | 0
91 to 180 days overdue | 3 | 0
Over 180 days overdue | 47 | 37
Total | 1,329 | 1,175

As at 31 December 2022, a gross amount of EUR 116 (EUR 82) million of trade receivables
were overdue. These relate to a number of countries and unrelated customers that have no
recent history of default. At 31 December 2022, lifetime expected credit losses for trade
receivables amounted to EUR 32 (EUR 26) million. Loss allowances for trade receivables are
estimated on an individual basis based on a forward-looking model where estimated probabilities
of customer default are used in the calculation model. If the Group has concerns regarding the
financial status of a customer, an advance payment or an irrevocable letter of credit drawn from
a bank is required. At the year end, the letters of credit awaiting maturity totalled EUR 74 (EUR
90) million. Please refer to Note 24 Financial risk management for details of customer credit risk
management.
Age analysis of loss allowance

| As at 31 December
EUR million | 2022 | 2021
Not overdue and less than 90 days overdue | 5 | 1
91 to 365 days overdue | 7 | 0
Over 365 days overdue | 21 | 25
Total | 32 | 26

Reconciliation of loss allowance

| As at 31 December
EUR million | 2022 | 2021
Opening balance at 1 January | 26 | 35
Change in loss allowance booked through income statement | 13 | 3
Write-offs | -6 | -12
Closing Balance at 31 December | 32 | 26

The actual credit losses during 2022 amounted to EUR 6 (EUR 12) million of trade receivables
being written-off from the Group's balance sheet.
Stora Enso has entered into factoring agreements to sell trade receivables in order to
accelerate cash conversion. These agreements resulted in full derecognition of trade receivables
amounting to a nominal value of EUR 174 (EUR 184) million at the end of the year. The
continuing involvement of Stora Enso in the sold receivables was estimated as being
insignificant due to the non-recourse nature of the factoring arrangements involved.
58
Note 18 Shareholders' equity
Accounting principles
Dividend and capital repayments
Any dividend or capital repayment proposed by the Board is not deducted from distributable
shareholders’ equity until approved by the shareholders at the Annual General Meeting.
At 31 December 2022, shareholders’ equity amounted to EUR 12,532 (EUR 10,683) million,
compared to the market capitalisation on Nasdaq Helsinki of EUR 10,503 (EUR 12,809) million.
The market values of the shares were EUR 13.90 (EUR 16.60) for A shares and EUR 13.15
(EUR 16.14) for R shares. In 2022, EUR 434 (237) million of dividend was paid, corresponding
to EUR 0.55 (0.30) per share.
The A shares entitle the holder to one vote per share, whereas R shares entitle the holder to
one vote per ten shares with a minimum of one vote, though the accountable par of both shares
is the same. A shares may be converted into R shares at any time at the request of a
shareholder. At 31 December 2022, the company’s fully paid-up share capital, as entered in the
Finnish Trade Register, was EUR 1,342 million (EUR 1,342 million). The current accountable par
of each issued share is EUR 1.70 (EUR 1.70).
At 31 December 2022, Directors and Group Leadership Team members owned 127 (0) A
shares and 363,604 (475,519) R shares representing 0.02% of the total voting rights of the
company. Full details of Director and Executive interests are shown in Note 7 Board and
executive remuneration. A full description of company share award programmes is shown in
Note 21 Employee variable compensation and equity incentive schemes. However, none of
these have any impact on the issued share capital.
Change in share capital and number of shares

| A shares | R shares | Total
At 1 January 2021 | 176,254,415 | 612,365,572 | 788,619,987
Conversion of A shares to R shares | -10,366 | 10,366 | —
At 31 December 2021 | 176,244,049 | 612,375,938 | 788,619,987
Conversion of A shares to R shares | -5,769 | 5,769 | —
At 31 December 2022 | 176,238,280 | 612,381,707 | 788,619,987
Number of votes as at 31 December 2022 1 | 176,238,280 | 61,238,171 | 237,476,451
Share capital at 31 December 2022, EUR million | 300 | 1,042 | 1,342
Share capital at 31 December 2021, EUR million | 300 | 1,042 | 1,342
1 R share votes are calculated by dividing the number of R shares by 10. The issued shares by 6 March 2023 will represent the total shares eligible to vote at the forthcoming Annual General Meeting.

Note 19 Non-controlling interests
Accounting principles
Non-controlling interests are presented as a separate component within the equity of the Group
in the consolidated statement of financial position. The proportionate shares of profit or loss
attributable to non-controlling interests and to owners of the parent company are presented in
the consolidated income statement after the profit for the period. Transactions between non-
controlling interests and Group shareholders are transactions within equity and are thus shown
in the statement of changes in equity. The measurement type of non-controlling interest is
decided separately for each acquisition.
Non-controlling interests

| Year Ended 31 December
EUR million | 2022 | 2021
At 1 January | -16 | -16
Disposals | 0 | 0
Share of profit for the period | -13 | 3
Share of other comprehensive income | 0 | -3
Dividends | 0 | 0
At 31 December | -30 | -16

Principal non-controlling interests

|  | As at 31 December
|  | 2022 | 2022 | 2021
Company | Principal place of business | Proportion of ownership interests held by non- controlling Interests, % | EUR million
Stora Enso Pulp and Paper Asia AB Group | Sweden and China | See separate table below | -31 | -18
Others | - |  | 1 | 1
Total |  |  | -30 | -16

Non-controlling interests in Stora Enso Pulp and Paper Asia AB Group

|  | 31 December 2022 | 31 December 2021
Company | Principal place of business | Direct-% of NCI | Indirect- % of NCI | Total-% of NCI | Direct-% of NCI | Indirect- % of NCI | Total-% of NCI
Stora Enso Pulp and Paper Asia AB | Sweden and China | 5.79 | — | 5.79 | 5.79 | — | 5.79
Guangxi Stora Enso Forestry Co Ltd | China | 5.00 | 5.50 | 10.50 | 5.00 | 5.50 | 10.50
Stora Enso (Guangxi) Packaging Company Ltd | China | 15.00 | 4.92 | 19.92 | 15.00 | 4.92 | 19.92
Stora Enso (Guangxi) Forestry Company Ltd | China | 15.00 | 4.92 | 19.92 | 15.00 | 4.92 | 19.92

Summarised financial information in respect of the subsidiaries that have material non-
controlling interests is set out below.
59
Stora Enso Pulp and Paper Asia AB Group

EUR million | 2022 | 2021
Assets | 1,235 | 1,282
Equity attributable to the owners of the parent | -165 | -115
Non-controlling interests 1 | -31 | -18
Total equity | -196 | -133
Liabilities | 1,430 | 1,414
Net profit or loss for the period | -74 | 7
Attributable to |  |
Owners of the parent | -61 | 4
Non-controlling interests | -13 | 3
Net profit or loss for the period | -74 | 7
Net cash flow from operating activities | 64 | 90
Net cash flow from investing activities | -41 | -37
Net cash flow from financing activities | 4 | -26
Net cash flow | 27 | 27
1 No dividends were paid to non-controlling interests in 2022 or 2021.

Note 20 Post-employment benefit obligations
Accounting principles
Employee benefits
The Group operates a number of defined benefit and contribution plans throughout the world,
the assets of which are generally held in separate trustee administered funds. Such pension and
post-retirement plans are generally funded by payments from employees and by the relevant
Group companies, taking into account the recommendations of independent qualified actuaries.
Employer contributions to the defined contribution pension plans are charged to the consolidated
income statement in the year they relate to.
For defined benefit plans, accounting values are assessed using the projected unit credit
method. Under this method, the cost of providing pensions is charged to the consolidated
income statement to spread the regular cost over the service lives of employees in accordance
with the advice of qualified actuaries who carry out a full valuation of the plan every year in all
major pension countries. The pension obligation is measured as the present value of the
estimated future cash outflows using interest rates of highly rated corporate bonds or
government securities, as appropriate, that match the currency and expected duration of the
related liability.
The Group recognises all actuarial gains and losses arising from defined benefit plans directly
in equity, as disclosed in its consolidated statement of comprehensive income. Past service
costs are identified at the time of any amendments to the plans and are recognised immediately
in the consolidated income statement regardless of vesting requirements. In the Group’s
consolidated statement of financial position, the full liability for all plan deficits is recorded.
The Group's pension expenses amounted to EUR 152 (EUR 165) million in 2022, as shown in
Note 6 Personnel expenses. Pensions are classified as defined contribution plans and defined
benefit plans. The majority of the Group's pensions plans are defined contribution plans for
which the charge amounted to EUR 146 (EUR 153) million. The priority of the Group is to
provide defined contribution plans as its post-employment benefits.
Net defined benefit obligation reconciliation

| Defined benefit obligation | Fair value of plan assets | Net defined benefit liability / (asset)
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
At 1 January | 1,108 | 1,210 | -762 | -737 | 347 | 473
Current service cost | 12 | 14 |  |  | 12 | 14
Past service cost | -6 | -2 | 0 | 0 | -6 | -2
Settlements | -7 | -5 | 7 | 5 | 0 | 0
Interest expense (+) income (-) | 13 | 9 | -10 | -6 | 3 | 3
Total included in income statement | 11 | 17 | -3 | -1 | 9 | 15
Actuarial changes in demographic assumptions | -13 | 3 |  |  | -13 | 3
Actuarial changes in financial assumptions | -306 | -21 |  |  | -306 | -21
Actuarial changes from experience adjustments | 63 | -42 |  |  | 63 | -42
Return on plan assets 1 |  |  | 105 | -65 | 105 | -65
Asset ceiling impact 1 |  |  | 5 | 0 | 5 | 0
Total remeasurement gains (-) / losses (+) included in OCI | -256 | -61 | 109 | -65 | -147 | -126
Benefit payments | -54 | -58 | 41 | 44 | -13 | -14
Employer contributions and refunds |  |  | 4 | 1 | 4 | 1
Translation difference | -38 | 1 | 33 | -3 | -5 | -3
Disposals and classification as held for sale | -35 | 0 | 0 | 0 | -35 | 0
At 31 December | 736 | 1,108 | -577 | -762 | 159 | 347

1 Excluding amounts included in interest expense (+) income (-)
In 2023, contributions of EUR 19 (EUR 17) million are expected to be paid to Group's defined
benefit plans.
Significant actuarial assumptions used in the valuation of defined benefit obligations

| Year ended 31 December
| Finland | Germany | Sweden
| 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Discount rate % | 3.6 | 0.7 | 3.6 | 0.8 | 4.0 | 1.7
Future salary increase % | 3.0 | 3.2 | 2.5 | 2.5 | 2.9 | 2.9
Future pension increase % | 2.2 | 2.3 | 2.0 | 1.8 | 2.0 | 2.0
Duration of pension plans | 8.0 | 10.0 | 10.2 | 13.0 | 13.1 | 16.5

60
Sensitivity of the defined benefit obligation

| Impact on defined benefit obligation
| Change in assumption | Increase in assumption | Decrease in assumption
Discount rate | 0.50% | Decrease by 5.8% | Increase by 6.4%
Salary growth rate | 0.50% | Increase by 1.2% | Decrease by 1.1%
Pension growth rate | 0.50% | Increase by 4.8% | Decrease by 4.4%
Life expectancy | 1 year | Increase by 4.2% | Decrease by 4.1%

The Group defines following actuarial risks associated with defined benefit plans:
Interest risk
The obligations are assessed using market rates of high-quality corporate or government bonds
to discount the obligations and are therefore subject to any volatility in the movement of the
market rate. The net interest income or expense recognised in profit and loss are also calculated
using the market rate of interest.
Life expectancy
In the event that members live longer than assumed, the obligations may be understated
originally and a deficit may emerge if funding has not adequately provided for the increased life
expectancy.
Defined benefit plan summary by country as at 31 December 2022

| 31 December 2022
EUR million | Finland | Germany | Sweden | Other | Total
Present value of funded obligations | 172 | 3 | 226 | 163 | 563
Present value of unfunded obligations | 0 | 134 | 15 | 24 | 173
Defined benefit obligations (DBO) | 172 | 137 | 241 | 187 | 736
Fair value of plan assets | -157 | -4 | -266 | -150 | -577
Net liability in the balance sheet | 15 | 134 | -26 | 36 | 159
Represented by |  |  |  |  |
Defined benefit pension plans | 15 | 134 | -26 | 13 | 136
Other post-employment benefits | 0 | 0 | 0 | 23 | 23
Net liability in the balance sheet | 15 | 134 | -26 | 36 | 159

Defined benefit plan summary by country as at 31 December 2021

| 31 December 2021
EUR million | Finland | Germany | Sweden | Other | Total
Present value of funded obligations | 238 | 5 | 359 | 236 | 838
Present value of unfunded obligations | 0 | 224 | 20 | 27 | 270
Defined benefit obligations (DBO) | 238 | 229 | 379 | 263 | 1,108
Fair value of plan assets | -208 | -4 | -324 | -226 | -762
Net liability in the balance sheet | 29 | 225 | 55 | 37 | 347
Represented by |  |  |  |  |
Defined benefit pension plans | 29 | 225 | 55 | 12 | 321
Other post-employment benefits | 0 | 0 | 0 | 25 | 25
Net liability in the balance sheet | 29 | 225 | 55 | 37 | 347

Finland
In Finland the employees are entitled to a statutory pensions benefit determined by Employee's
pension Act (TyEL). These benefits are defined as contribution benefits. They are insured with
an insurance company and provide coverage for old age, disability and death. Charge in the
income statement from contribution benefits is EUR 64 (EUR 71) million.
In addition, the Group has additional defined benefit plans which resulted in a charge of EUR
0 (EUR 1) million excluding finance costs. Defined benefit plans and plan assets are managed
by insurance companies. Details of the exact structure and investment strategy surrounding plan
assets are not available to participating employers, as the assets actually belong to the
insurance companies themselves. The assets are managed in accordance with EU regulations,
and also national requirements, under which there is an obligation to pay guaranteed benefits
irrespective of market conditions.
Germany
German pension costs amounted to EUR 6 (EUR 7) million, of which EUR 6 (EUR 6) million
related to defined contribution plans and EUR 1 (EUR 1) million to defined benefits excluding
finance costs. The net defined benefit liability amounted to EUR 134 (EUR 225) million. The
decrease in net liability arose mainly from changes in actuarial assumptions, especially from an
increase in discount rate.
Defined benefit pension plans are mainly accounted for in the statement of financial position
through book reserves with some minor plans using insurance companies or independent
trustees. Retirement benefits are based on years worked and salaries received during the
pensionable service and the commencement of pension payments are linked to the national
pension scheme’s retirement age. Pensions are paid directly by the companies themselves to
their former employees. The security for the pensioners is provided by the legal requirement that
the book reserves held in the statement of financial position are insured up to certain limits.
Sweden
In Sweden, all blue-collar staff and part of white-collar staff are covered by defined contribution
plans, the charge in the Income statement being EUR 54 (EUR 56) million. Defined benefit plans
are covering the remaining white-collar staff and resulted in a charge of EUR 1 (EUR 8) million
excluding finance costs. The net defined benefit asset amounted to EUR 26 (liability EUR 55)
million. The d ecrease in net liability arose mainly from changes in actuarial assumptions,
especially from an increase in discount rate. Stora Enso has undertaken to pay all local legal
pension liabilities for the main ITP scheme to the foundation, thus the remaining liability relates
61
to other small plans. The long-term investment return target for the foundation is a 3% real return
after tax.
Other countries
The net defined benefit liability in the remaining countries amounted to EUR 36 (EUR 37) million.
The most material change in liability was recognised for United Kingdom. The decrease in net
liability arose mainly from changes in actuarial assumptions.
Plan assets

| As at 31 December
| 2022 | 2021
EUR million | Quoted | Unquoted | Total | % of total | Quoted | Unquoted | Total | % of total
Equity | 88 | 12 | 101 | 17% | 122 | 37 | 159 | 21%
Debt | 46 | 44 | 90 | 16% | 58 | 55 | 112 | 15%
Property | 0 | 55 | 55 | 9% | 0 | 50 | 50 | 7%
Cash | 10 | 0 | 10 | 2% | 25 | 0 | 25 | 3%
Assets held by insurance companies | 0 | 226 | 226 | 39% | 0 | 308 | 308 | 40%
Others | 0 | 96 | 96 | 17% | 7 | 101 | 108 | 14%
Total pension fund assets | 144 | 433 | 577 | 100% | 211 | 551 | 762 | 100%
Plan assets do not include any real estate or other assets occupied by the Group or the Company's own financial instruments.

The two main financial factors affecting Group's pension liabilities are changes in interest rates
and inflation expectations. The aim of asset investment allocations is to neutralise these effects,
secure solvency for benefit payments and maximise returns.
Note 21 Employee variable compensation and equity incentive
schemes
Accounting principles
Share awards
The costs of all employee-related share-based payments are charged to the consolidated
income statement as personnel expenses over the vesting period.
All share-based payment transactions are classified as equity-settled share awards. The
equity-settled share awards (net of tax), are measured at the fair value of the equity instruments
on the grant date, and are adjusted for the present value of expected dividends. The fair value of
the equity-settled share-based payments determined on the grant date is expensed on a
straight-line basis over the vesting period, based on the estimate of equity instruments that will
eventually vest, with a corresponding increase in equity.
Short term incentive (STI) programmes
Salaries for senior management are negotiated individually. Stora Enso has incentive plans that
take into account the performance, development and results of both business units and
individual employees. This performance-based variable compensation system is based on
profitability as well as on attaining key business targets.
Group Executives, as well as division and business unit management have STI programmes
in which the payment is calculated as a percentage of the annual base salary with a maximum
level ranging from 8% to 100%. Non-management employees participate in an STI programme
with a maximum incentive level of 7%. All incentives are discretionary. These performance-
based programmes cover most employees globally, where allowed by local practice and
regulations. For the performance year 2022, the annual incentive programmes were based on
financial measures as well as targets related to operational efficiency, emission reduction, safety
and individual targets. The financial success metrics in the STI programme 2022 are Sales
growth and EBITDA.
Long term incentive (LTI) programmes
Since 2005, new share based programmes for executives have been launched every year. The
2020 programme, ending in 2022 and settled in 2023 has a three-year performance period. The
2021 programme, ending in 2023 and settled in 2024, has three one-year performance periods
which are accumulated after three years. The 2022 programme features performance metrics
with one-year performance periods which are accumulated after three years as well as three-
years performance periods. All outstanding programmes will be settled in one portion after three
years.
For the vast majority of awarded employees, three quarters (75%) of the opportunity under
the programmes are in performance shares, where shares will vest in accordance with
performance criteria proposed by the People and Culture Committee and approved by the Board
of Directors. The financial performance metrics are 3-year Economic Value Added (EVA) and
Earnings Per Share (EPS) for the Stora Enso Group for the 2020 and 2021 programme and EPS
and Relative Total Shareholder Return for the 2022 programme, which in addition features ESG
metrics (emissions reduction and diversity). One quarter (25%) of the opportunity under the
programmes are in Restricted Shares, for which vesting is only subject to continued
employment. Members of the GLT have been awarded performance shares only.
Outstanding restricted and performance share opportunities before taxes are shown in the
table below. The total number of shares actually transferred will be less than that shown below
because a portion of shares corresponding to employees' tax obligation will be withheld to cover
income tax.
Share awards at 31 December 2022

| Outstanding restricted and performance share awards at year end
Number of shares | 2023 | 2024 | 2025 | Total
2020 programme | 903,289 |  |  | 903,289
2021 programme |  | 716,460 |  | 716,460
2022 programme |  |  | 822,240 | 822,240
Total | 903,289 | 716,460 | 822,240 | 2,441,989

The costs of the Stora Enso share-based programmes are recognised as costs over the vesting
period, which is the period between the grant and vesting. The total impact of share-based
programmes in the income statement amounted to an expense of EUR 8 (EUR 7) million, all of
which were related to restricted and performance share awards.
62
Note 22 Provisions
Accounting principles
Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a
result of past events, and it is probable that an outflow of resources will be required to settle the
obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are
measured at the management’s best estimate and there is some uncertainty regarding the
timing and amount of the costs. Provisions for obligations to dismantle, remove or restore assets
after their use are added to the carrying amount of the assets at acquisition date and
depreciated over the useful life of the asset. Provisions are discounted to their current net
present value if the effect of the time value of money is material.
Environmental provisions
Environmental expenditures resulting from the remediation of an existing condition caused by
past operations, and which do not contribute to current or future revenues, are recognised as
provisions. Environmental liabilities are recorded when it is probable, based on current
interpretations of environmental laws and regulations, that a present obligation has arisen and
the amount of such liability can be reliably estimated.
Restructuring provisions
A restructuring provision is recognised in the period in which the Group becomes legally or
constructively committed to the plan. The relevant costs are those that are incremental to, or
incurred as a direct result of, the exit plan, or are the result of a continuing contractual obligation
with no ongoing economic benefit, or represent a penalty incurred to cancel the obligation.
Other provisions
Other provisions are recognised regarding different legal or constructive obligations, such as
onerous contracts, guarantees to customers, ongoing lawsuits, claims, or similar.
Provisions

EUR million | Environmental provisions | Restructuring provisions | Other provisions | Total provisions
Carrying Value at 1 January 2021 | 91 | 28 | 30 | 149
Translation difference | 0 | -1 | 0 | -1
Charge in Income Statement |  |  |  |
New provisions | 6 | 107 | 72 | 185
Increase in existing provisions | 13 | 1 | 0 | 14
Reversal of existing provisions | -6 | -4 | -5 | -15
Payments | -29 | -44 | -29 | -101
Carrying Value at 31 December 2021 | 75 | 88 | 67 | 231
Translation difference | -4 | -3 | -2 | -9
Disposals and classification as held for sale | -3 | -1 | 0 | -4
Charge in Income Statement |  |  |  |
New provisions | 14 | 8 | 19 | 40
Increase in existing provisions | 1 | 12 | 2 | 15
Reversal of existing provisions | -1 | -16 | -8 | -25
Payments | -9 | -66 | -50 | -124
At 31 December 2022 | 73 | 21 | 30 | 124
Allocation between current and non- current provisions |  |  |  |
Current provisions: Payable within 12 months | 10 | 20 | 14 | 43
Non-current provisions: Payable after 12 months | 64 | 2 | 16 | 81
Total at 31 December 2022 | 73 | 21 | 30 | 124

Provisions for environmental remediation amounted to EUR 73 (75) million at 31 December
2022. The most material environmental provision is based on an agreement between Stora Enso
and the City of Falun that obligates the Group to purify runoff from the Kopparberg mine before
releasing the water into the environment. The provision at year end amounted to EUR 31 (EUR
37) million.
The Group has undergone major restructuring in recent years, from divestments to mill
closures and administrative cost-saving programmes. The obligation at the end of 2022
amounted to EUR 21 (EUR 88) million for restructuring provisions and EUR 30 (EUR 67) million
with respect to other provisions. Material payments in 2022 in restructuring and other provisions
are mainly related to closing down pulp and paper production at Kvarnsveden Mill in Sweden
and Veitsiluoto Mill in Finland as announced in 2021.
Note 23 Operative liabilities
Non-current operative liabilities

| As at 31 December
EUR million | 2022 | 2021
Share-based payments | 2 | 1
Other payables | 9 | 12
Total | 11 | 13

63
Current operative liabilities

| As at 31 December
EUR million | 2022 | 2021
Trade payables | 1,831 | 1,704
Payroll and staff-related accruals | 245 | 256
Accrued liabilities and deferred income | 130 | 155
Emission liabilities | 91 | 99
Advances received | 18 | 18
Other payables 1 | 94 | 107
Total | 2,410 | 2,339
1 Other payables consist especially of taxes payable to government, such as VAT and payroll taxes.

Note 24 Financial risk management
Risk management principles and process
Stora Enso is exposed to several financial market risks that the Group is managing under the
policies approved by the Board of Directors. The objective is to ensure cost-effective funding of
Group companies and manage financial risks effectively. The Stora Enso Group Financial Risk
Policy governs all financial transactions in Stora Enso. This policy and any future amendments
take effect once they are approved by the Board of Directors and all policies covering the use of
financial instruments must comply with it. The Group’s joint operations companies operate under
their own financial risk policies, which may not be fully similar to the Group’s policies.
The major financial market risks are detailed below with the main exposures for the Group being
interest rate risk, currency risk, liquidity risk, refinancing risk, and commodity price risk,
especially for fiber, pulp, and energy.
Interest rate risk
The Group is exposed to an interest rate risk that is the risk of fluctuating interest rates affecting
the interest expense of the Group and value of its assets and liabilities. Stora Enso is exposed to
the interest rate risk through interest-bearing assets and liabilities, such as loans, financial
instruments and lease liabilities, but also through commercial agreements and operative assets
and liabilities such as biological assets. The Group’s aim is to keep interest costs stable. The
Group’s aggregate duration should not exceed the average loan maturity, but should aim
towards a long duration. A duration above the average loan maturity is approved by the Board of
Directors.
The Group may use interest-rate swaps and cross-currency swaps to manage the interest-
rate risk by synthetically converting floating-rate loans into fixed-rate loans through the use of
derivatives. The Group's floating and fixed rate interest-rate position as per the year-end is
presented in the following table:
Floating and fixed interest-rate position

| As at 31 December 2022 | As at 31 December 2021
EUR million | Floating rate | Fixed rate | Floating rate | Fixed rate
Non-current interest-bearing receivables 1 | 11 | 80 | 5 | 40
Current interest-bearing receivables | 1 | — | — | 49
Cash and cash equivalents | 1,917 |  | 1,481 |
Interest-bearing liabilities 2 | -1,074 | -2,818 | -974 | -2,863
Interest-bearing assets and liabilities excluding derivatives | 855 | -2,738 | 512 | -2,774
Interest-rate and cross-currency swaps | 650 | -650 | 682 | -682
Interest-bearing assets and liabilities, net of derivatives | 1,506 | -3,388 | 1,194 | -3,456
1 Excluding interest receivable and listed securities 2 Non-current interest-bearing liabilities, current portion of non-current debt, short-term interest bearing liabilities and bank overdrafts excluding derivative liabilities and interest payable

The average interest duration for the Group's net interest-bearing liabilities, including all interest
rate derivatives but excluding cash and cash equivalents, is 3.3 (4.6) years.
As of 31 December 2022, one percentage point increase in interest rates would increase
annual net interest expenses by approximately EUR 4 (EUR 2) million and a similar decrease in
interest rates would decrease net interest expenses by EUR 4 (EUR 1) million. This assumes
that the duration and the funding structure of the Group remain constant throughout the year.
This simulation calculates the interest effect of a 100 basis point parallel shift in interest rates on
all floating rate instruments excluding cash equivalents from their next reset date to the end of
the year. In addition, all short-term loans maturing during the year are assumed to be rolled over
on maturity to year end using the new higher or lower interest rate.
A one percentage point parallel change up or down in interest rates would also result in fair
valuation gains or losses of EUR 10 (EUR 16) million before taxes in the cash flow hedge
reserve in OCI regarding interest rate swaps under cash flow hedge accounting. A one
percentage point parallel change up or down in interest rate would result in fair valuation gains
or losses of EUR 1 (EUR 3) million in net financial items related to cross currency swaps fair
valued through profit and loss. Note 27 Derivatives summarises the nominal and fair values of
the outstanding interest rate derivative contracts.
Foreign exchange risk - transaction risk
The Group operates globally and is exposed to a foreign-currency transaction risk arising from
exchange rate fluctuations. Foreign exchange transaction risk exposure comprises both the
geographical location of Stora Enso production facilities around the world, sourcing of raw
materials and sales of end products in foreign currencies, mainly denominated in US dollars,
British pounds and Swedish crowns. Stora Enso Group companies with functional currency other
than euro are also exposed to a foreign-currency transaction risk arising from EUR denominated
net cash flows. These EUR exposures mainly arise from Stora Enso subsidiaries located in
Sweden, Czech Republic and Poland.
The currency transaction risk is the impact of exchange rate fluctuations on the Group's
Income statement, which is the effect of currency rates on expected future cash flows and
subsequent trade receivables or payables. The Group's standard policy to mitigate the risk is to
hedge 15–60% of the highly probable forecast cash flows in major currencies for the next 12
months by using derivative financial instruments, such as foreign exchange forwards and foreign
exchange options. The Group may also hedge periods between 12 months and 36 months, or
64
change the above mentioned hedging ratio for the next 12 months upon the discretion of the
Group's management.
For operative receivables and payables in foreign currencies, the objective is to hedge 50–
100% of the outstanding net receivable balance in major currency pairs.
The table below presents the estimated net operative foreign currency transaction risk
exposures for the main currencies for the next 12 months and the related foreign-currency
hedges in place as at 31 December, retranslated using year end exchange rates. The net
operative receivables and payable exposures, representing the balances as at 31 December,
include foreign currency exposures generated by external and intercompany transactions in line
with the requirements of IFRS 7. A positive amount of exposure in the table below represents an
estimated future inflow or receivable of a foreign currency amount.
Operative foreign currency transaction risk exposure

| As at 31 December 2022 | As at 31 December 2021
EUR million | EUR | SEK | USD | GBP | AUD | UYU | EUR | SEK | USD | GBP | AUD | UYU
Estimated annual net cash flow exposure in hedged foreign-currency flows 1 | 960 | -238 | 1,983 | 240 | 83 | -48 | 995 | -191 | 1,712 | 346 | 138 | -41
Cash flow hedges for the next 12 months | -525 | 119 | -843 | -59 | -26 | 26 | -553 | 89 | -740 | -78 | -38 | 23
Estimated annual net cash flow exposure, net of hedges | 435 | -119 | 1,139 | 181 | 57 | -22 | 442 | -101 | 971 | 268 | 100 | -18
Hedging percentage as at 31 December for next 12 months | 55% | 50% | 43% | 24% | 31% | 54% | 56% | 47% | 43% | 22% | 27% | 57%
Weighted-average hedged rate against EUR 2 |  | 10.63 | 1.09 | 0.87 | 1.52 | 45.20 | — | 10.21 | 1.20 | 0.85 | 1.60 | 52.63
Operative receivables and payables net exposure | -22 | 8 | 284 | 30 | 49 | -5 | -42 | 5 | 233 | 32 | 58 | -2
Net receivable currency hedges | -18 | -3 | -186 | -16 | -51 | — | 16 | — | -200 | -26 | -26 | —
Net operative receivables exposure, net of hedges | -39 | 5 | 98 | 14 | -2 | -5 | -26 | 5 | 34 | 5 | 31 | -2
Estimated annual net transaction risk exposure after hedges | 396 | -113 | 1,238 | 195 | 55 | -27 | 416 | -97 | 1,005 | 274 | 131 | -20
1 Cash flows are forecasted highly probable net operating foreign-currency cash flows in hedged currencies. The exposure presented in the EUR column relates to operative transaction risk exposure from EUR denominated cash flows in Group companies located in Sweden, Czech Republic and Poland with functional currency other than EUR. 2 The weighted-average exchange rate against EUR is calculated based on bought leg of option collar structure and forward contracts' forward rate and therefore represents the weighted-average hedged rate based on the least favourable hedged rate from the Group's point-of-view.

The following table includes the estimated effect on the annual operating profit of a weakening of
an exposure currency against the functional currencies of exposed subsidiaries. The sensitivities
have been calculated based on a 5% movement in EUR, SEK, USD, GBP and AUD while 10%
movement in UYU. These changes are estimated as reasonably possible changes in exchange
rates, measured against year-end closing rates. A corresponding strengthening of the exposure
currency would have an approximately equal opposite impact. A negative amount in the table
reflects a potential net loss in the income statement or equity and, conversely, a positive amount
reflects a potential net gain. In practice, the actual foreign currency results may differ from the
sensitivity analysis presented below, since the income statements of subsidiaries with functional
currencies other than the euro are translated into the Group reporting currency using the
average exchange rates for the year, whereas the statements of the financial position of such
subsidiaries, including currency hedges, trade receivables and payable, are translated using the
exchange rates at the reporting date. The translation risk exposures are discussed more in detail
under the Translation risk chapter below.
The calculation includes currency hedges and assumes that there are no changes in other
underlying currencies. The currency effects are based on estimated operative foreign currency
flows for the next twelve months, hedging levels at the year end, and the assumption that the
currency cash flow hedging levels and all other variables will remain constant during the next
twelve months. Hedging instruments include foreign exchange forward contracts and foreign
exchange options. Indirect currency effects with an impact on prices and product flows, such as
a product becoming cheaper to produce in a different geographical location, have not been
considered in this calculation.
Sensitivity analysis of operative foreign currency transaction risk exposure

| As at 31 December 2022 | As at 31 December 2021
EUR million | EUR | SEK | USD | GBP | AUD | UYU | EUR | SEK | USD | GBP | AUD | UYU
Exposure currency change by 1 | -5% | -5% | -5% | -5% | -5% | -10% | -5% | -5% | -5% | -5% | -5% | -10%
Effect on estimated annual net cash flows in hedged flows | -48 | 12 | -99 | -12 | -4 | 5 | -50 | 10 | -86 | -17 | -7 | 4
Effect on cash flow hedging OCI reserve before taxes as at year end 2 | 26 | -6 | 42 | 3 | 1 | -3 | 28 | -4 | 37 | 4 | 2 | -2
Effect on net operative receivables and payables after hedges 3 | 2 | — | -5 | -1 | — | — | 1 | — | -2 | — | -2 | —
Estimated annual EBIT impact 4 | -20 | 6 | -62 | -10 | -3 | 3 | -21 | 5 | -50 | -14 | -7 | 2
1 The sensitivity analysis for EUR denominated annual net cash flows, operative net receivables and related hedges refer to the EUR denominated transaction risk arising from EUR denominated foreign-currency cash flows in Sweden, Czech Republic and Poland with functional currency other than EUR. 2 The effect on OCI cash flow hedging reserve before taxes at year end is related to the fair value change in derivative contracts qualifying as cash flow hedges of highly probable forecast transactions under IFRS 9. Amount effecting OCI will be recycled to operative result when the transaction realises. 3 Currency effect related to net operative receivables or payables and related hedges. 4 The estimated annual EBIT impact includes currency effects in respect of operative exposures in the Statement of Financial Position, forecast cash flows and the related hedges.

The following table presents the financial foreign currency exposure and the related hedges in
place as at 31 December for the main currencies. Net debt includes foreign-currency external
loan payables and receivables, foreign-currency internal loan payables and loan receivables and
cash equivalents. Loans designated as net investment loans under IAS 21 are excluded from the
table as they reduce the foreign-currency exposures on a Group level. Internal transaction
exposure includes foreign-currency payables and receivables outstanding within the Group at
reporting date. The currency derivatives mainly hedge financial exposures in the statement of
financial position. A negative amount of exposure in the table represents a net payable of a
foreign currency amount.
Additionally, the table includes the estimated effect on the income statement of a currency
weakening of an exposure currency against EUR. The sensitivities have been calculated based
on a 5% movement in SEK, USD, CNY, and PLN. These changes are estimated as reasonably
possible changes in exchange rates, measured against year-end closing rates. A corresponding
strengthening of the exposure currency would have an approximately equal opposite impact. A
65
negative amount in the table reflects a potential net loss in the Income statement and,
conversely, a positive amount reflects a net potential gain. In practice, the actual foreign
currency results may differ from the sensitivity analysis below as the exposure amounts may
change during the year.
Financial foreign currency exposure and estimated currency effects in income statement

| As at 31 December 2022 | As at 31 December 2021
EUR million | SEK | USD | CNY | PLN | CZK | SEK | USD | CNY | PLN
Foreign-currency net debt 1 | -418 | -101 | 355 | -6 | -62 | -30 | -95 | 462 | -1
Currency hedges | -3 | -46 | -211 | -7 | 62 | 7 | -31 | -272 | -16
Net exposure after hedges | -422 | -146 | 144 | -12 | — | -23 | -125 | 190 | -18
Internal transaction exposure |  |  |  | 138 | 45 |  |  |  |
Currency hedges |  |  |  | -124 | -41 |  |  |  |
Net non-operative exposure | — | — | — | 14 | 3 |  |  |  |
Exposure currency change by | -5% | -5% | -5% | -5% | -5% | -5% | -5% | -5% | -5%
Effect in the Income Statement 2 | 21 | 7 | -7 | — | 6 | 1 | 6 | -10 | 1
1 The Group has designated certain internal loans to Chinese subsidiaries as net investment loans under IAS 21. The loans are denominated in EUR, USD, and CNY. The underlying foreign currency gain or loss will be posted as part of CTA in Equity. The nominal amount of net investment loans amounted to EUR 398 (EUR 348) million as per the year end and reduces the currency exposure for relevant currencies in the above table. 2 Gains and losses are recognised as part of Net financial items in the Income Statement

Foreign exchange risk – translation risk
Translation risk results from fluctuations in exchange rates affecting the value of Stora Enso’s
consolidated net foreign currency denominated assets, liabilities, and income. Translation risk is
reduced by funding assets, whenever economically possible, in the same currency as the asset
itself. The Group may also enter into foreign exchange forwards, foreign exchange options or
foreign currency denominated loans to hedge its net investments in foreign entities with different
functional currencies than the Group.
The balance sheets of foreign subsidiaries, equity accounted investments and foreign
currency denominated equity instruments in the scope of IFRS 9 are translated into euros using
exchange rates prevailing on the reporting date, thus exposing consolidated Group equity to
fluctuations in currency rates. The resulting translation differences, along with other movements
such as the translation rate difference in the income statement, are recorded directly in
shareholders’ equity. These cumulative differences materialise through the Income statement on
the disposal, in whole or in part, of the foreign entity.
The following table presents the translation risk exposure in the Group's Income statement
arising from the translation of subsidiaries' and joint operations' foreign-currency income
statements into the presentation currency of the Group in the consolidated financial statements.
Translation exposure in Income statement

| As at 31 December 2022 |  | As at 31 December 2021 |
EUR million | SEK | USD | BRL | CZK | CNY | SEK | USD | BRL | CZK | CNY
Translation exposure in Income Statement | -147 | -192 | -164 | -38 | 77 | -196 | -129 | -111 | 11 | 83
Exposure currency change by | -5% | -5% | -10% | -5% | -5% | -5% | -5% | -10% | -5% | -5%
Effect on EBIT from translation risk exposure | 7 | 10 | 16 | 2 | -4 | 10 | 6 | 11 | -1 | -4

The next table presents the translation exposure for geographical areas for which the Group has
applied net investment hedging techniques to reduce the foreign-currency translation exposure
in the consolidated equity. In practise, the Group also incurs material unhedged translation risk
exposures in other geographical areas such as Sweden and China. The exposures used in the
calculations are based on the foreign currency denominated equity and the hedging levels as at
31 December. Full details of actual CTA movements and hedging results are given in Note 28
Cumulative translation adjustment and equity hedging. The sensitivity analysis includes the
effects of currency hedges of net investments in foreign entities and assumes that no changes
take place other than a single currency exchange rate movement on 31 December each year.
Hedged translation exposure in Equity

| As at 31 December
EUR million | 2022 | 2021
Translation exposure on equity in USD area 1 | 1,686 | 1,502
EUR/USD equity hedges 2 | -281 | -265
Translation exposure after hedges | 1,405 | 1,237
Sensitivity before hedges - EUR strengthening 5% | -84 | -75
Sensitivity after hedges - EUR strengthening 5% | -70 | -62
1 Includes the joint operation Montes del Plata in Uruguay, which has USD as its functional currency. 2 USD denominated bonds classified as hedges of net investments in foreign assets.

Liquidity and refinancing risk
Liquidity risk arises from the difficulty of obtaining finance for operations at a given point in time.
Stora Enso’s funding policy states that the average maturity of outstanding loans and committed
credit facilities covering short-term borrowings should be at least four years. The policy further
states that the Group must have cash equivalents and undrawn committed credit facilities to
cover all debt maturing within the next 12 months, including supply chain financing and factoring.
At 31 December 2022, undrawn committed credit facilities and undrawn loans were at EUR
1,100 (EUR 700) million. During 2022, altogether EUR 550 million of bilateral bank loans were
arranged. EUR 200 million of these loans were undrawn at reporting date. The EUR 700 million
committed credit facility agreement with a syndicate of 12 banks had originally a maturity of five
years with two one-year extensions. In October 2022, the first extension option of this facility
was used together with all 12 banks and the new maturity is in 2027. In May 2022, the Group
signed a new EUR 200 million committed credit facility with a maturity of one year and one six
month extension option. The extension option was exercised in October 2022 and therefore the
new maturity is during the last quarter of 2023. The credit facilities are used as a backup for
general corporate purposes and are both fully undrawn. Additionally, Stora Enso has access to
various additional long-term sources of funding up to EUR 1,050 (EUR 1,000) million. These
mainly relate to available funding sources from Finnish pension funds.
66
Refinancing risk, or the risk that maturing debt is not refinanced in the markets, is mitigated
by Stora Enso’s target of maintaining an even maturity profile of outstanding debt. The table
below shows maturity analysis for the Group's contractual financial liabilities classified under
principal headings based on the remaining period to contractual maturity at the reporting date.
Forward interest rates as at the year-end were used for estimating contractual finance charges
for the upcoming years.
Contractual maturity repayments of financial liabilities, settlement net: 2022

EUR million | 2023 | 2024 | 2025 | 2026 | 2027 | 2028+ | Total
Bond loans | 300 | 270 | 404 | 90 | 325 | 1,081 | 2,470
Loans from credit institutions | 306 | 40 | 273 | 5 | 0 | 0 | 624
Lease liabilities | 63 | 49 | 44 | 33 | 30 | 159 | 377
Other non-current financial liabilities | 0 | 2 | 0 | 0 | 0 | 0 | 2
Non-current borrowings including current portion | 668 | 361 | 721 | 128 | 355 | 1,240 | 3,472
Estimated contractual finance charges | 108 | 90 | 74 | 43 | 40 | 190 | 545
Estimated contractual lease charges | 16 | 14 | 13 | 11 | 10 | 58 | 123
Contractual repayments on non- current borrowings | 792 | 465 | 807 | 182 | 405 | 1,489 | 4,140
Current borrowings, carrying amounts | 429 | 0 | 0 | 0 | 0 | 0 | 429
Gross-settled derivative liabilities - receipts | -2,405 | 0 | 0 | 0 | 0 | 0 | -2,405
Gross-settled derivative liabilities - payments | 2,401 | 0 | 0 | 0 | 0 | 0 | 2,401
Net-settled derivative liabilities | -4 | 0 | 0 | 0 | 0 | 0 | -5
Trade payables | 1,831 | 0 | 0 | 0 | 0 | 0 | 1,831
Bank overdrafts | 0 | 0 | 0 | 0 | 0 | 0 | 0
Estimated contractual finance charges | 6 | 0 | 0 | 0 | 0 | 0 | 6
Total Contractual Repayments at 31 December 2022 | 3,050 | 464 | 807 | 182 | 405 | 1,489 | 6,398

Contractual maturity repayments of financial liabilities, settlement net: 2021

EUR million | 2022 | 2023 | 2024 | 2025 | 2026 | 2027+ | Total
Bond loans | 0 | 300 | 293 | 427 | 98 | 1,390 | 2,508
Loans from credit institutions | 117 | 253 | 41 | 165 | 4 | 0 | 578
Lease liabilities | 64 | 50 | 43 | 35 | 31 | 165 | 387
Other non-current financial liabilities | 0 | 4 | 0 | 0 | 0 | 0 | 4
Non-current borrowings including current portion | 180 | 606 | 376 | 627 | 132 | 1,555 | 3,476
Estimated contractual finance charges | 73 | 72 | 63 | 55 | 39 | 218 | 521
Estimated contractual lease charges | 16 | 14 | 13 | 12 | 11 | 61 | 126
Contractual repayments on non- current borrowings | 269 | 693 | 452 | 693 | 182 | 1,834 | 4,123
Short-term borrowings, carrying amounts | 372 | 0 | 0 | 0 | 0 | 0 | 372
Gross-settled derivative liabilities - receipts | -1,797 | 0 | 0 | 0 | 0 | 0 | -1,797
Gross-settled derivative liabilities - payments | 1,769 | 0 | 0 | 0 | 0 | 0 | 1,769
Net-settled derivative liabilities | 16 | 10 | 1 | 0 | 0 | 0 | 27
Trade payables | 1,705 | 0 | 0 | 0 | 0 | 0 | 1,705
Bank overdrafts | 1 | 0 | 0 | 0 | 0 | 0 | 1
Estimated contractual finance charges | 5 | 0 | 0 | 0 | 0 | 0 | 5
Total Contractual Repayments at 31 December 2021 | 2,339 | 703 | 453 | 693 | 182 | 1,834 | 6,205

Financial transactions counterparty credit risk
Financial counterparty risk is the risk of fluctuations in the value of the Group’s assets as a result
of counterparties being unable to meet their obligations arising from financial contracts. The
exposure to a financial counterparty risk is measured as the maximum loss that Stora Enso can
suffer directly in the event of a single counterparty’s credit default. This risk is minimised by:
•entering into transactions only with leading financial institutions and with industrial companies
that have a good credit rating;
•only investing in liquid funds and deposits with financial institutions or companies that have a
minimum credit rating of BBB-.
•at least the higher of 50% of cash equivalents, or EUR 150 million, of cash equivalents to be
held at counterparties with a minimum rating of A- or equivalent using credit ratings from main
rating agencies;
•investing at least EUR 75 million of the Group's cash and cash equivalents at counterparties
other than the counterparty at which most of Stora Enso's cash and cash equivalents are
held;
•requiring parent company guarantees when dealing with any subsidiary of a rated company.
The Group Financial Risk Policy defines the limits for accepted counterparty risk, based on the
tenor of financial contract and counterparty’s credit rating.
At the year end 2022, there were no significant concentrations of risk with respect to
counterparties of derivative contracts, with the highest counterparty mark-to-market exposure
being at EUR 41 (EUR 22) mil lion and credit rating of A+ (A+) using Standard and Poor’s credit
rating symbols.
67
Customer credit risk
Customer credit risk is Stora Enso’s exposure to contracts arising from deterioration in the
financial health of its customers. The Group uses various measures to reduce customer credit
risks, including, but not limited to, letters of credit, prepayments and bank guarantees. The
Group has also obtained export guarantees, covering both political and commercial risks, which
are used in connection with individual customers outside the OECD area. Management
considers that no significant concentration of credit risk with any individual customer,
counterparty or geographical region exists for Stora Enso. The ageing information of trade
receivables and related loss allowances are given in Note 17 Operative receivables.
Commodity price risk
Outstanding commodity hedges

| As at 31 December 2022 | As at 31 December 2021
| Underlying amount of commodity hedged | Average hedged commodity price | Nominal amount hedged in EUR million | Fair value EUR million | Underlying amount of commodity hedged | Average hedged commodity price | Nominal amount hedged in EUR million | Fair value EUR million
Electricity purchases |  |  |  |  |  |  |  |
- Nordic region | 175,200 MWh | EUR 29.1 | 5 | 18 | 438,000 MWh | EUR 29.02 | 13 | 15
- Central Europe |  |  |  |  | 87,600 MWh | EUR 43.06 | 4 | 12
Oil purchases | 200,474 barrels | USD 73.5 | 14 | — | 189,808 barrels | USD 58.06 | 10 | 2

The Group is exposed to commodity and energy price volatility that will have an impact on the
Group's profitability. Electricity, natural gas and oil hedge derivatives are part of energy price risk
management in the Group, whilst other commodity risks are measured and hedged if
economically possible. In addition to electricity hedge derivatives, the Group also manages
energy price risk by entering into long-term physical fixed price purchase agreements, and by
holding a 15.6% stake in Pohjolan Voima Oy (PVO), which is a privately owned Group of
companies in the energy sector in Finland. The fair value of the shares amounted to EUR 1,423
(EUR 900) million as per the year-end. The fair value of these shares is dependent on electricity
market prices and discussed in more detail in Note 14 Equity instruments.
A 10% movement in energy and raw material prices would result in a EUR 6 (EUR 6) million
change in the fair value of commodity financial hedges described in the above table. The
majority of these fair value changes, after taxes, are recorded directly in Equity under Hedging
Reserves, until the contracts mature and the result is entered in the Income statement. These
estimates only represent the sensitivity of commodity financial instruments to market risk and not
the Group's full exposure to raw material and energy price risks as a whole, since the actual
underlying purchases are not financial instruments within the scope of the IFRS 7 standard. At
the end of 2022, the maturities of the energy and commodity contracts, including both financial
hedges and fixed-price physical purchase agreements, ranged between 2023 and 2024. In
2021, the maturities ranged between 2022 and 2024.
In an effort to mitigate other commodity price risk exposures in relation to wood fiber price
risk, the Group is a significant owner of forest assets in the Nordic region. In Sweden the Group
owns 1.4 million hectares of forest land. In addition, Stora Enso holds 41% share in Tornator Oyj,
which is a significant forest owner in Finland. The Group's share in Tornator is reported as an
equity accounted investment and discussed in more detail in Note 13 Equity accounted
investments. The Group's forest assets are discussed in more detail in Note 12 Forest assets.
Equity price risk
The Group has certain investments in publicly traded securities. Currently these relate to
Packages Ltd shares in Pakistan. The market value of these equity investments was EUR 8
(EUR 13) million at the year end. Market value changes in these investments are recorded, after
taxes, directly under Shareholders’ Equity in the Equity instruments through OCI reserve.
Detailed discussion regarding the publicly traded securities can be found from Note 14 Equity
instruments.
Capital risk management
Stora Enso’s debt structure is focused on capital markets and commercial banks. Group
objectives when managing capital are to safeguard the ability to continue as a going concern in
order to provide returns for shareholders and benefits for other stakeholders, as well as to
maintain an optimal capital structure to maintain reasonable cost of capital. In order to maintain
or adjust the capital structure, the Group may, subject to shareholder approval as appropriate,
vary the dividends paid to shareholders, buy its own shares on financial markets, return capital
to shareholders, issue new shares or sell assets to reduce debt. The Group strives to pay stable
dividends linked to the long-term performance with the aim of distributing 50% of Earnings per
share (EPS) excluding fair valuations over the cycle.
The Group monitors its capital on the basis of a target net debt-to-equity ratio of 0.60 or less,
and aiming that the Net-debt-to-Operational EBITDA ratio remains below 2.0, indicating a solid
financial position, and financial flexibility.
Capital structure

| As at 31 December
EUR million | 2022 | 2021
Interest-bearing liabilities | 3,972 | 3,938
Interest-bearing assets | 2,122 | 1,629
Net debt | 1,850 | 2,309
Equity attributable to owners of the parent | 12,532 | 10,683
Operational EBITDA 1 | 2,529 | 2,184
Net debt to equity ratio | 0.15 | 0.22
Net debt to operational EBITDA | 0.73 | 1.06
1 Operational EBITDA definition is included in the "Non-IFRS measures" chapter in the Report of the Board of Directors. |  |

Montes del Plata, a joint operation of Stora Enso, and the Group's subsidiary Stora Enso
(Guangxi) Packaging and Forestry Company Ltd have complied with financial covenants related
to debt-to-assets ratio during the reported periods. There are no other covenants in the Group's
financing contracts.
68
Note 25 Fair values
Accounting principles
Financial assets
The Group classifies its financial assets into three categories, which are amortised cost, fair
value through other comprehensive income and fair value through profit and loss. The
classification is made according to the IFRS 9 standard and management determines the
classification of investments at the time of initial recognition.
With investments in debt instruments, the classification is made based on the business model
and contractual cash flow characteristics of debt instruments. Investments in debt instruments,
for which the business model objective is to hold the financial instruments to collect contractual
cash flows and those cash flows are solely payments of principal and interest, are classified as
amortised cost and presented under current or non-current assets in the consolidated statement
of financial position. Investments in debt instruments, for which the business model objective is
to hold the financial instruments for both to collect contractual cash flows and sell financial
instruments and the cash flows are solely payments of principal and interest, are classified as
fair value through other comprehensive income and presented under current or non-current
assets in the consolidated statement of financial position.
The Group's investments into equity instruments, such as listed and unlisted securities, are
classified as fair value through profit and loss unless the Group has at inception decided to apply
the irrevocable election under IFRS 9 to classify the investments as fair value through other
comprehensive income with only dividend income from the investments being recognised in the
income statement.
Investments that are not measured at amortised cost or at fair value through other
comprehensive income are classified as fair value through profit and loss and are therefore fair
valued through the consolidated income statement and presented under current or non-current
assets in the consolidated statement of financial position.
Financial liabilities
The Group's financial liabilities are classified into amortised cost or fair value through profit and
loss categories. Financial liabilities are measured at amortised cost unless the Group has
decided to apply a fair value option to designate a financial liability to be measured at fair value
through profit and loss.
Derivatives
Derivative financial assets and liabilities are measured at fair value and classified as fair value
through profit and loss or, if the Group has applied hedge accounting, at fair value through other
comprehensive income according to the IFRS 9 standard. Derivative financial instruments and
hedge accounting are discussed in more detail in Note 27 Derivatives.
Fair value of financial instruments
The fair values of publicly traded derivatives and listed securities, are based on quoted market
prices at the reporting date; the fair values of interest rate swaps are calculated as the present
value of the estimated future cash flows, and the fair values of foreign exchange forward
contracts are determined using forward exchange rates at the reporting date. The valuation
principles for derivative financial instruments have been described in more detail in Note 27
Derivatives.
In assessing the fair values of non-traded derivatives and other financial instruments, the
Group uses a variety of methods and makes assumptions based on the market conditions at
each reporting date. Quoted market prices or dealer quotes for identical or similar instruments
are used for non-current debt. Other techniques, such as option pricing models and estimated
discounted value of future cash flows, are used to determine fair values for the remaining
financial instruments. The face values, less any estimated credit adjustments, for financial
assets and liabilities with a maturity of less than one year are assumed to approximate their fair
values. The fair values of financial liabilities for disclosure purposes are estimated by discounting
the future contractual cash flows at the current market interest rates available to the Group for
similar financial instruments.
Purchases and sales of financial instruments are recognised based on trade date accounting,
which is the date on which the Group commits to purchasing or selling the financial instrument.
Financial instruments are derecognised when the rights to receive or the cash flows from the
financial instruments have expired or have been transferred and the Group has substantially
transferred all risks, rewards and obligations of the ownership of the financial asset or liability.
Fair value hierarchy
The Group uses the following hierarchy for determining and disclosing the fair value of financial
instruments by valuation technique:
•Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities;
•Level 2: other techniques, for which all inputs which have a significant effect on the recorded
fair value are observable, either directly or indirectly;
•Level 3: techniques which use inputs which have a significant effect on the recorded fair
values that are not based on observable market data.
The Group evaluates the categorisation of its fair value measurements within the fair value
hierarchy on a regular basis at the end of the reporting period. There were no transfers
recognised in the fair value hierarchy between Levels 1 and 2 and no transfers into or out of
Level 3 fair value measurements during 2022 and 2021. See Note 14 Equity instruments for
more information on Level 3 fair value measurement of listed and unlisted securities.
69
Carrying amounts of financial assets and liabilities by measurement and fair value categories: 2022

|  |  |  |  |  | Fair value hierarchy |
EUR million | Amortised cost | Fair value through OCI | Fair value through income statement | Total carrying amount | Fair value | Level 1 | Level 2 | Level 3 | Note
Financial assets |  |  |  |  |  |  |  |  |
Listed securities | — | 8 | — | 8 | 8 | 8 | — | — | 14
Unlisted securities | — | 1,423 | 14 | 1,437 | 1,437 | — | — | 1,437 | 14
Non-current interest-bearing receivables | 92 | 28 | — | 120 | 120 | — | 28 | — | 26
Derivative assets | — | 28 | — | 28 | 28 | — | 28 | — |
Loan receivables | 92 | — | — | 92 | 92 | — | — | — |
Trade and other operative receivables | 1,138 | 66 | — | 1,204 | 1,204 | — | 66 | — | 17
Current interest-bearing receivables | 10 | 50 | 16 | 77 | 77 | — | 67 | — | 26
Derivative assets | — | 50 | 16 | 67 | 67 | — | 67 | — |
Other short-term receivables | 10 | — | — | 10 | 10 | — | — | — |
Cash and cash equivalents | 1,917 | — | — | 1,917 | 1,917 | — | — | — |
Total | 3,157 | 1,576 | 30 | 4,763 | 4,763 | 8 | 161 | 1,437 |

|  |  |  |  |  | Fair value hierarchy |
EUR million | Amortised cost | Fair value through OCI | Fair value through income statement | Total carrying amount | Fair value | Level 1 | Level 2 | Level 3 | Note
Financial liabilities |  |  |  |  |  |  |  |  |
Non-current interest-bearing liabilities | 2,792 | — | — | 2,792 | 2,749 | — | — | — | 26
Derivative liabilities | — | — | — | 0 | 0 | — | — | — |
Non-current debt | 2,792 | — | — | 2,792 | 2,748 | — | — | — |
Current portion of non-current debt | 667 | — | — | 667 | 667 | — | — | — | 26
Current interest-bearing liabilities | 462 | 30 | 20 | 513 | 513 | — | 50 | — | 26
Derivative liabilities | — | 30 | 20 | 50 | 50 | — | 50 | — |
Current debt | 462 | — | — | 462 | 462 | — | — | — |
Trade and other operative payables | 2,076 | — | — | 2,076 | 2,076 | — | — | — | 23
Bank overdrafts | — | — | — | 0 | 0 | — | — | — |
Total | 5,998 | 30 | 20 | 6,048 | 6,005 | — | 51 | — |
In accordance with IFRS, derivatives are classified as fair value through income statement. In the above tables for financial assets and liabilities the cash flow hedge accounted derivatives are however presented as fair value through OCI, in line with how they are booked for the effective portion.

70
Carrying amounts of financial assets and liabilities by measurement and fair value categories: 2021

|  |  |  |  |  | Fair value hierarchy |
EUR million | Amortised cost | Fair value through OCI | Fair value through income statement | Total carrying amount | Fair value | Level 1 | Level 2 | Level 3 | Note
Financial assets |  |  |  |  |  |  |  |  |
Listed securities | — | 13 | — | 13 | 13 | 13 | — | — | 14
Unlisted securities | — | 900 | 5 | 905 | 905 | — | — | 905 | 14
Non-current interest-bearing receivables | 45 | 6 | — | 51 | 51 | — | 6 | — | 26
Derivative assets | — | 6 | — | 6 | 6 | — | 6 | — |
Loan receivables | 45 | — | — | 45 | 45 | — | — | — |
Trade and other operative receivables | 1,110 | 39 | — | 1,149 | 1,149 | — | 39 | — | 17
Current interest-bearing receivables | 52 | 31 | 1 | 84 | 84 | — | 32 | — | 26
Derivative assets | — | 31 | 1 | 32 | 32 | — | 32 | — |
Other short-term receivables | 52 | — | — | 52 | 52 | — | — | — |
Cash and cash equivalents | 1,481 | — | — | 1,481 | 1,481 | — | — | — |
Total | 2,687 | 990 | 6 | 3,683 | 3,683 | 13 | 77 | 905 |

|  |  |  |  |  | Fair value hierarchy |
EUR million | Amortised cost | Fair value through OCI | Fair value through income statement | Total carrying amount | Fair value | Level 1 | Level 2 | Level 3 | Note
Financial liabilities |  |  |  |  |  |  |  |  |
Non-current interest-bearing liabilities | 3,284 | 7 | 23 | 3,313 | 3,618 | — | 30 | — | 26
Derivative liabilities | — | 7 | 23 | 30 | 30 | — | 30 | — |
Non-current debt | 3,284 | — | — | 3,284 | 3,589 | — | — | — |
Current portion of non-current debt | 180 | — | — | 180 | 180 | — | — | — | 26
Current interest-bearing liabilities | 403 | 35 | 7 | 444 | 444 | — | 42 | — | 26
Derivative liabilities | — | 35 | 7 | 42 | 42 | — | 42 | — |
Current debt | 403 | — | — | 403 | 403 | — | — | — |
Trade and other operative payables | 1,960 | — | — | 1,960 | 1,960 | — | — | — | 23
Bank overdrafts | 1 | — | — | 1 | 1 | — | — | — |
Total | 5,827 | 42 | 29 | 5,899 | 6,204 | — | 71 | — |
In accordance with IFRS, derivatives are classified as fair value through income statement. In the above tables for financial assets and liabilities the cash flow hedge accounted derivatives are however presented as fair value through OCI, in line with how they are booked for the effective portion.

In t he previous tables, the fair value is estimated to be equal to the carrying amount for current
financial assets and financial liabilities, such as trade receivables and payables due to their short
time to maturity and limited credit risk. The fair value of non-current loan receivables, considered
as a level 2 fair value measurement, is based on the discounted cash flow analysis. The fair
value of non-derivative interest-bearing liabilities, considered as a level 2 fair value
measurement, is estimated based on a discounted cash flow analysis in which the yield curves
observable at commonly quoted intervals are used as a discount factor in the model.
71
Reconciliation of level 3 fair value measurement of financial assets and liabilities

EUR million | 2022 | 2021
Financial assets |  |
Opening balance at 1 January | 905 | 401
Reclassifications | -1 | 0
Gains/losses recognised in other comprehensive income | 523 | 504
Additions | 10 | 1
Closing balance at 31 December | 1,437 | 905

The Group did not have level 3 financial liabilities as at 31 December 2022.
Note 26 Interest-bearing assets and liabilities
Accounting principles
Interest-bearing assets - loan receivables
Loan receivables are debt instruments with fixed or determinable payments that are not quoted
on an active market. They are recorded initially at fair value and subsequently measured at an
amortised cost. Loss allowance for expected credit losses is calculated based on the general
approach under IFRS 9, where loss allowance is recognised based on 12-month expected credit
losses if there has not been a significant increase in credit risk since the initial recognition. A
significant increase in the credit risk will be evaluated based on a comparison of the risk of a
default occurring on the financial instrument as at the reporting date with the risk of default
occurring on the financial instrument as at the date of initial recognition. The Group may use, for
example, rates of credit default swaps (CDS) observable on financial markets to produce the risk
assessment.
Interest income on loan receivables is included in financial income and expense. Loan
receivables with a maturity less than 12 months are included in current assets under interest-
bearing receivables, and those with maturities greater than 12 months, in non-current interest-
bearing receivables.
Interest-bearing liabilities
Interest-bearing liabilities are recognised initially at fair value, net of transaction costs incurred.
In subsequent periods, interest-bearing liabilities are measured at amortised cost using the
effective interest method. Any difference between the proceeds net of transaction costs and
redemption value is recognised in the consolidated income statement over the maturity period of
the borrowings. Interest expenses are accrued for and recorded in the consolidated Income
statement for each period.
Interest-bearing liabilities with an original maturity greater than 12 months are classified as
non-current interest-bearing liabilities in the consolidated statement of financial position, though
repayments falling due within 12 months are presented in current liabilities under the current
portion of non-current debt. Short-term commercial paper, bank and other interest-bearing
liabilities, for which the original maturity is less than 12 months, are presented in current
liabilities under interest-bearing liabilities.
Lease liabilities
At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right to control the use of an identified
asset for a period of time in exchange for consideration. Lease liabilities are initially capitalised
at the commencement of the lease and measured at the present value of the lease payments
that are not paid at the commencement date, discounted using the Group’s incremental
borrowing rate. The lease term applied corresponds to the non-cancellable period except in
cases where the Group is reasonably certain to exercise renewal option or prolong the contract.
The Group allocates the consideration in the contract to each lease component and separates
non-lease components if these are identifiable. Lease terms are negotiated on an individual
basis and contain a wide range of different terms and conditions.
The lease liabilities are subsequently measured at amortised cost using the effective interest
method. Lease payment is allocated between the capital liability and finance charges to achieve
a constant interest rate on the outstanding liability balance. Lease liabilities are remeasured
mainly when there is a change in future lease payments arising from a change in an index or
rate, or if there is a change in the Group’s assessment whether it will exercise an extension
option. When lease liability is remeasured, a corresponding adjustment is generally made to the
carrying amount of the right-of-use asset.
The Group has elected not to recognise lease liabilities for short-term leases that have a
lease term of 12 months or less and leases of low value assets. Leases of low value assets
mainly include IT and office equipment, certain vehicles and machinery and other low value
items. The Group recognises the lease payments associated with these leases as an expense
on a straight-line basis over the lease term.
Managing Interest Rate Benchmark Reform and associated risks
A global reform on interest reference rates is underway as existing IBOR reference rates are
being replaced by alternative risk-free rates. The impact of the transition is expected to be
limited for the Group's external contracts. The Group has exposure to IBORs on its financial
instruments that will be replaced or reformed as part of these market-wide initiatives. The
Group's main IBOR exposure at 31 December 2022 was indexed to US dollar LIBOR and
related amount of interest bearing liabilities outstanding at 31 December 2022 was EUR 211
(EUR 189) million. The publication of USD LIBORs will cease after June 2023.
The Group monitors the process of transition from IBORs to new benchmark rates by
reviewing the total amounts of contracts that have yet to transition to an alternative benchmark
rate. The expected impact is limited and relates mainly to external long-term debt. The Group's
financial instruments are mainly indexed to Euribor and Stibor reference rates and these are
expected to continue to exist for now.
72
Interest-bearing assets

| As at 31 December
EUR million | 2022 | 2021
Listed securities | 8 | 13
Long-term derivative assets | 28 | 6
Long-term deposits | 48 | 42
Long-term loans to equity accounted investments | 2 | 2
Other long-term loan receivables | 41 | 1
Total non-current interest-bearing assets | 128 | 64
Short-term derivative assets | 66 | 32
Short-term deposits | 0 | 49
Other short-term loan receivables | 11 | 3
Cash and cash equivalents | 1,917 | 1,481
Total current interest-bearing assets | 1,994 | 1,565
Total interest-bearing assets | 2,122 | 1,629

The annual average interest income rate for deposits and loan receivables during 2022 was
approximately 1.0% (0.1%). Current interest-bearing receivables included EUR 10 (EUR 3)
million accrued interest at 31 December 2022. The Group has evaluated that there has not
been a significant increase in credit risk related to interest-bearing deposits and investments
after the initial recognition. Accordingly, the loss all owance is recognised based on 12-month
expected credit losses.
As part of Other long-term loan receivables balances, EUR 41 million represent receivables,
net of impairment allowance, originating from sale of Russia operations, to be received in
instalments in future periods. These receivables were recognised at inception at their fair value
(EUR 58 million) using a discount rate of 27.1% and are carried in the financial statement of
position at amortised cost. At reporting date, loss allowance of EUR 7 million, based on 12-
month expected credit losses was recognised in profit and loss. The fair valuation of these
receivables and evaluation of their credit risk and collectability involves a significant degree of
judgement.
Interest-bearing l iabilities

| As at 31 December
EUR million | 2022 | 2021
Bond loans | 2,460 | 2,497
Loans from credit institutions | 623 | 577
Lease liabilities | 375 | 387
Long-term derivative financial liabilities (see Note 25) | 0 | 30
Other non-current liabilities | 2 | 4
Non-current interest-bearing liabilities including current portion | 3,459 | 3,493
Short-term borrowings | 429 | 372
Interest payable | 35 | 34
Short-term derivative financial liabilities (see Note 25) | 49 | 38
Bank overdrafts | 0 | 1
Total Interest-bearing Liabilities | 3,972 | 3,938
EUR million | 2022 | 2021
Carrying Value at 1 January 1 | 3,938 | 4,756
Translation differences on opening balance | -4 | 120
Proceeds of new long-term debt | 366 | 19
Repayment of long-term debt | -351 | -862
Additions in lease liabilities | 45 | 33
Repayment of lease liabilities and interest | -73 | -88
Proceeds/repayments of short-term borrowings | 75 | -73
Change in interest payable | 19 | 16
Change in derivative financial liabilities | -19 | 38
Disposals and classification as held for sale | -5 | -1
Other | 8 | 2
Translation differences during the year | -28 | -22
Total Interest-bearing Liabilities | 3,972 | 3,938

1 The table format has been updated to better present changes in liabilities arising from cash flow activities and non-cash activities. The
comparison figures have been restated accordingly.
Events during 2022 and 2021
During 2022, altogether EUR 550 million of bilateral bank loans were arranged. Maturities of
these loans vary from 18 months to 3 years with extension options. Proceeds from these loans
are used for general corporate purposes and EUR 200 million of these loans were undrawn at
reporting date. Stora Enso repaid credit institution loans, according to maturity schedule,
amounted to a nominal of EUR 289 million during 2022.
In May 2022, Stora Enso signed a new EUR 200 million committed credit facility with a
maturity of one year and one six month extension option which was exercised in October 2022.
In December 2021, Stora Enso signed a new EUR 700 million Revolving Credit Facility (RCF)
with 12 commercial banks. The maturity of the facility is five years with two one-year extensions.
The pricing is partly linked to meeting emission targets on Scope 1&2 and Scope 3. In October
2022, the first extension option of this facility was used together with all 12 banks and therefore
maturity is now in 2027. Simultaneously, the existing EUR 600 million RCF with original maturity
in 2023 was cancelled.
Stora Enso has a Green Bond Framework as part of its Sustainable Finance approach. The
ambition is to offer a loan-format to support sustainability-focused fixed income investors and to
report the direct environmental impacts of some investments and business activities.
73
During 2021, Stora Enso repaid multiple credit institution loans ahead of final maturity, the
total repayments of loans and bond notes amounted to a nominal of EUR 911 million. This
resulted in a EUR 7 million initial modification net loss being recognised in the Income
Statement.
Interest-bearing liabilities - maturities, interest rates and currency breakdown
Stora Enso's borrowings maturities range from 2023 to the longest borrowing maturing in 2036.
Borrowings have either fixed or floating interest rates ranging from 0.5% (0.5%) to 7.3% (7.3%).
The average interest rate on borrowings for the full year amounted to 3.2% (3.0%) with a run-
rate of 3.3% as per the year end. Part of Stora Enso's borrowings have been fixed through
floating-to-fixed interest rate swaps and cross-currency swaps. The majority of Group loans are
denominated in euros, US dollars, Swedish crowns or Chinese renminbis. Detailed maturity
analysis of the Group's borrowings are set out in Note 24 Financial risk management.
Net debt
In 2022 net interest-bearing liabilities, including held for sale related assets, decreased by EUR
456 (decreased by EUR 611) million to EUR 1,854 (EUR 2,309) million. Net interest-bearing
liabilities are equal to total interest-bearing liabilities less total interest-bearing assets such as
cash equivalents and deposits. Cash and cash equivalents net of overdrafts increased by EUR
437 (decreased by EUR 175) million to EUR 1,917 (EUR 1,480) million as at 31 December
2022. In 2022, the total cash outflow for leases was EUR 73 (EUR 88) million including interest
component of EUR 17 (EUR 17) million.
The ratio of net debt to the last 12 months' operational EBITDA was 0.7 (1.1). The net debt/
equity ratio was 0.15 (0.22) as per the year-end.
Bond loans

Issue/ Maturity Dates | Description of Bond | Interest Rate % | Currency of Bond | Nominal Value Issued | Outstanding As at 31 December | Carrying Value As at 31 December
|  |  |  | 2022 | 2021 | 2022 | 2021
All Liabilities are Held by the Parent Company | Currency million | EUR million
Fixed Rate |  |  |  |  |  |  |  |
2006-2036 | Global 7.250% Notes 2036 | 7.25 | USD | 300 | 300 | 300 | 278 | 262
2016-2023 | Euro Medium Term Note | 2.125 | EUR | 300 | 300 | 300 | 300 | 300
2017-2027 | Euro Medium Term Note | 2.5 | EUR | 300 | 300 | 300 | 299 | 299
2018-2028 | Euro Medium Term Note | 2.5 | EUR | 300 | 300 | 300 | 299 | 298
2019-2024 | Euro Medium Term Note (Green Bond) | 1.875 | SEK | 1,750 | 1,750 | 1,750 | 157 | 171
2020-2025 | Euro Medium Term Note (Green Bond) | 2.375 | SEK | 1,550 | 1,550 | 1,550 | 140 | 152
2020-2030 | Euro Medium Term Note (Green Bond) | 0.625 | EUR | 500 | 500 | 500 | 495 | 495
Total Fixed Rate Bond Loans |  |  |  | 1,968 | 1,976
Floating Rate |  |  |  |  |  |  |
2015-2025 | Euro Medium Term Note | Euribor+2.25 | EUR | 125 | 125 | 125 | 125 | 125
2015-2027 | Euro Medium Term Note | Euribor+2.35 | EUR | 25 | 25 | 25 | 25 | 25
2019-2024 | Euro Medium Term Note (Green Bond) | Stibor+1.45 | SEK | 1,250 | 1,250 | 1,250 | 112 | 122
2019-2026 | Euro Medium Term Note (Green Bond) | Stibor+1.60 | SEK | 1,000 | 1,000 | 1,000 | 90 | 97
2020-2025 | Euro Medium Term Note (Green Bond) | Stibor+2.20 | SEK | 1,550 | 1,550 | 1,550 | 140 | 152
Total Floating Rate Bond Loans |  |  |  |  |  |  | 492 | 521
Total Bond Loans |  |  |  |  |  |  | 2,460 | 2,497

74
Note 27 Derivatives
Accounting principles
Derivative financial instruments and hedge accounting
Derivative financial instruments are initially recognised in the consolidated statement of financial
position at fair value and subsequently measured at their fair value at each reporting date
according to valuation methods described in this note. Derivative contracts with maturity greater
than 12 months are classified as non-current interest-bearing receivables and liabilities, and
contracts maturing within 12 months are presented under current interest-bearing receivables
and liabilities.
When derivative contracts are entered into, the Group designates them as either hedges of
highly probable forecast transactions or firm commitments (cash flow hedges), hedges of the
exposure to changes in the fair value of recognised assets or liabilities (fair value hedges),
hedges of net investments in foreign entities, or derivative financial instruments not meeting the
hedge accounting criteria in accordance with IFRS 9. The method of recognising the resulting
gains or losses on derivative instruments is dependent on the nature of the item being hedged.
At the inception of a hedge, the Group documents the relationship between the hedging
instrument and the hedged item, as well as its risk management objective and strategy for
undertaking various hedging transactions. This process includes linking all financial instruments
designated under hedge accounting to specific assets and liabilities or to specific firm
commitments or highly probable forecast transactions in order to verify and document the hedge
relationship between the hedged item and the hedging instrument as required by IFRS 9. The
Group also documents its qualitative prospective assessment at the hedge inception of whether
the derivatives used in a hedge relationship are highly effective in offsetting changes in fair value
or cash flows of hedged items. Hedge effectiveness will be assessed in accordance with IFRS 9
requirements.
The hedge ratio used for hedging relationships is usually 1:1. For currency and commodity
hedging purposes, the Group uses a hedge designation where the critical terms of the hedging
instrument and the hedged item will coincide in terms of the notional amount and timing. In
respect of interest rate hedging, the interest rate basis between swap contracts and underlying
debt will coincide. Since the critical terms of the hedges and underlying risks match, the hedging
instruments are considered to offset any changes related to the anticipated transactions.
Potential sources of ineffectiveness that may be expected to occur in relation to currency and
commodity hedges are mainly related to the forecasted transaction not occurring in the amount
or at the time expected. For interest rate hedges, cross-currency basis spread or initial fair value
of the hedging instrument at the date of hedge designation may result in ineffectiveness being
recognised in the income statement. Potential sources of ineffectiveness for all the
aforementioned hedges also include possible effects of credit risk dominating fair value changes
arising from the hedging instrument and the hedged item designated under the hedging
relationship.
Cash flow hedges
Derivatives used in currency cash flow hedges are mainly forward contracts and options, with
swaps mainly used for commodity and interest rate hedging purposes. During 2022 and 2021,
the Group did not enter into new interest rate swap contracts.
Changes in the fair value of derivatives designated and qualifying as cash flow hedges, and
which are effective, are recognised in a separate equity category of OCI cash flow hedges
reserve, the movements of which are disclosed in the consolidated statement of comprehensive
income. For foreign exchange forwards, both the spot element and forward points have been
included to the hedge designation. In case of foreign exchange options, the time value of an
option is excluded from the hedge designation and only the intrinsic value component of an
option is designated as the hedging instrument. The changes in option time value are
recognised in a cost of hedging reserve within OCI. The cumulative gain or loss of a derivative
deferred in equity is transferred to the consolidated income statement and classified as an
income or expense in the same period in which the hedged item affects the consolidated income
statement. The unrealised gains and losses related to cash flow hedges are expected to be
recycled through the income statement within one to five years with the longest hedging contract
maturing in 2027 (2027). However, the majority of the contracts are expected to mature in 2023.
Realised results of hedge accounted derivative instruments hedging foreign currency sales
transactions or purchases are booked as adjustments to sales or materials and services,
depending on the nature of the underlying hedged item. In respect of hedges of exposures to
foreign currency risk of future transactions resulting in the recognition of non-financial assets, the
gains and losses deferred to the cash flow hedges reserve within OCI are transferred from
equity to be included in the initial acquisition cost of the non-financial asset at the time of
recognition. The Group may hedge foreign-currency risk of external or internal foreign-currency
purchases where the underlying amount purchased in a foreign-currency impacts the value of
inventory in a local currency. In such cases the gains and losses are initially booked as an
adjustment to raw material inventory and recycled further to finished goods inventory with being
ultimately recognised in the consolidated income statement at the time when the hedged items
are sold to an external customer. In case of non-current assets, the deferred amounts are
ultimately recognised in the income statement through depreciation over the lifetime of the non-
financial assets.
When a hedging instrument expires or is sold, terminated or exercised or no longer meets the
hedge accounting criteria under IFRS 9, any cumulative gain or loss deferred in equity at that
time remains in equity and is accounted for as an adjustment to income or expense when the
committed or forecast transaction is ultimately recognised in the consolidated income statement.
However, if the underlying forecasted transaction is no longer expected to occur, the cumulative
gain or loss reported in equity from the period when the hedge was effective is immediately
recognised in the consolidated income statement.
Fair value hedges
In case of fair value hedges, the Group uses either derivatives or borrowings as a hedging
instrument to manage the risk associated with the fair value of a hedged item. The gains and
losses on hedging instruments designated and qualifying as fair value hedges, and which are
highly effective, are recorded in the consolidated income statement, along with any changes in
the fair value of the hedged assets or liabilities attributable to the hedged risk. As at the end of
2022, the Group did not have fair value hedges.
Net investment hedges
For hedges of net investments in foreign entities, the Group uses either derivatives or foreign-
currency borrowings for this purpose. If the hedging instrument is a derivative, any gain or loss
thereon relating to the effective portion of the hedge is recognised in equity in CTA as disclosed
in the consolidated statement of comprehensive income; the gain or loss relating to the
ineffective portion is immediately recognised in the consolidated income statement. In addition,
exchange gains and losses arising on the translation of a foreign-currency borrowing that
hedges net investment in a foreign operation are also recognised in CTA, with any ineffective
75
portion being immediately recognised in the consolidated income statement. The gains and
losses recognised in CTA are recycled from equity to the consolidated income statement at the
time when the underlying hedged net investment is disposed.
Non-hedge accounted derivatives
Certain derivative transactions, while providing effective economic hedges under Group risk
management policies, do not qualify for hedge accounting under the specific rules in IFRS 9 and
therefore changes in the fair value of such non-qualifying hedges are accounted for at fair value
in the consolidated income statement. For non-hedge accounted derivatives economically
hedging foreign-currency risk of net of operative receivables and payables, the fair value
changes are recognised in operating profit under other operating income and expense. For other
non-hedge accounted derivatives, the fair value changes are recognised in the consolidated
income statement under financial income and expense.
Valuation of derivatives
Derivative financial instruments are recorded in the statement of financial position at their fair
values defined as the amount at which the instrument could be exchanged in an orderly
transaction between market participants at the measurement date. The fair values of such
financial items have been estimated on the following basis:
•Foreign exchange forward contract fair values are calculated using forward exchange rates at
the reporting date.
•Foreign exchange option contract fair values are calculated using reporting date market rates
together with common option pricing models.
•Commodity contract fair values are computed with reference to quoted market prices on
futures exchanges or other reliable market sources.
•Interest rate swaps fair values are calculated using a discounted cash flow method.
•Cross-currency swaps fair values are calculated by using a discounted cash flow method with
the exchange of notional also included in the valuation model.
Total foreign exchange gains and losses in the income statement excluding hedges

| Year ended 31 December
EUR million | 2022 | 2021
Other operating income | 42 | 31
Other operating expense | -21 | -14
Borrowings, cash equivalents. lease liabilities and other | -10 | 37
Total | 11 | 54

Hedge gains and losses in operating profit

| Year ended 31 December
EUR million | 2022 | 2021
Cash flow hedge accounted derivatives |  |
Currency hedges | -105 | 9
Commodity hedges | 43 | 34
Total | -62 | 43
As adjustments to sales | -103 | 6
As adjustments to materials and services | 41 | 37
Realised from OCI through income statement | -62 | 43
Currency hedges ineffectiveness | -2 | -1
Net losses from cash flow hedges | -65 | 42
Non-hedge accounted derivatives |  |
Net receivable hedges | -12 | -17
Commodity contract hedges | 9 | 0
Net gains/losses on non-hedge accounted derivatives | -3 | -17
Net hedge losses in operating profit | -67 | 26

In 2022, certain forecasted future transactions were no longer expected to occur, and due to this
hedge accounting was ceased for those transactions. This resulted in a loss of EUR 2 (EUR 1)
million being booked in the Group's operating profit and the loss being presented in the table
above as ineffectiveness from cash flow hedges.
Hedge gains and losses in financial items

| Year ended 31 December
EUR million | 2022 | 2021
Cash flow hedge accounted derivatives |  |
Interest rate hedges ineffectiveness | 0 | -2
Net gains/losses from cash flow hedges | 0 | -2
Non-hedge accounted derivatives |  |
Currency derivatives | 8 | -40
Interest rate derivatives | -4 | 0
Net gains on non-hedge accounted derivatives | 4 | -40
Net gains/losses in financial items | 4 | -42

76
Nominal and fair values of derivative instruments

| As at 31 December
EUR million | Nominal values | Positive fair values | Negative fair values | Net fair values | Nominal values | Positive fair values | Negative fair values | Net fair values
| 2022 | 2021
Currency derivatives |  |  |  |  |  |  |  |
Forwards: Operational cash flow hedging | 902 | 19 | -13 | 6 | 1,104 | 4 | -19 | -16
Options: Operational cash flow hedging | 1,700 | 12 | -16 | -4 | 980 | 2 | -13 | -10
Total cash flow hedge accounted | 2,603 | 32 | -30 | 2 | 2,084 | 6 | -32 | -26
Forwards: Trade and loan receivables hedging | 1,151 | 7 | -5 | 2 | 469 | 1 | -6 | -5
Total non-hedge accounted | 1,151 | 7 | -5 | 2 | 469 | 1 | -6 | -5
Total currency derivatives | 3,754 | 39 | -35 | 4 | 2,553 | 7 | -38 | -32
Commodity derivatives |  |  |  |  |  |  |  |
Electricity swaps: Costs hedging | 5 | 18 | 0 | 18 | 16 | 27 | 0 | 27
Oil swaps: Costs hedging | 14 | 1 | -1 | 0 | 10 | 3 | 0 | 2
Total cash flow hedge accounted | 19 | 18 | -1 | 18 | 27 | 29 | 0 | 29
Electricity swaps: Closed contracts | 11 | 9 | 0 | 9 | 0 | 0 | 0 | 0
Total non-hedge accounted | 11 | 9 | 0 | 9 | 0 | 0 | 0 | 0
Total commodity derivatives | 30 | 27 | -1 | 27 | 27 | 29 | 0 | 29
Interest rate derivatives |  |  |  |  |  |  |  |
Interest rate swaps: Financial expenses hedging | 450 | 28 | 0 | 28 | 482 | 1 | -8 | -7
Total cash flow hedge accounted | 450 | 28 | 0 | 28 | 482 | 1 | -8 | -7
Cross-currency swaps: Financial expenses hedging | 200 | 0 | -15 | -15 | 200 | 0 | -25 | -25
Total non-hedge accounted | 200 | 0 | -15 | -15 | 200 | 0 | -25 | -25
Total interest rate derivatives | 650 | 28 | -15 | 13 | 682 | 1 | -32 | -31
Total cash flow hedge accounted | 3,072 | 78 | -30 | 48 | 2,593 | 36 | -40 | -4
Total non-hedge accounted | 1,363 | 16 | -20 | -4 | 669 | 1 | -31 | -30
Total derivatives | 4,435 | 95 | -51 | 44 | 3,261 | 37 | -71 | -34

Positive and negative fair values of financial derivative instruments are shown under interest-
bearing receivables and liabilities, and non-current interest-bearing receivables and liabilities.
The presented fair values in the table include accrued interest and option premiums.
77
Changes in fair values of hedged items and hedging instruments 2022

EUR million | Change in value of hedged item to determine hedge effectiveness | Change in value of outstanding hedging instruments | Ineffectiveness
Foreign exchange risk - Forward and option contracts (excluding option time value)1 | 77 | -79 | -2
Foreign exchange risk - Net investment hedges | -16 | 16 | 0
Commodity price risk - Commodity swaps | -31 | 31 | 0
Interest rate risk - Interest rate swaps | -34 | 34 | 0
1 Ineffectiveness booked in Operating profit.

Changes in fair values of hedged items and hedging instruments 2021

EUR million | Change in value of hedged item to determine hedge effectiveness | Change in value of outstanding hedging instruments | Ineffectiveness
Foreign exchange risk - Forward and option contracts (excluding option time value) | 65 | -66 | -1
Foreign exchange risk - Net investment hedges | 21 | -21 | 0
Commodity price risk - Commodity swaps 1 | -60 | 60 | 0
Interest rate risk - Interest rate swaps | -11 | 11 | 0
Interest rate and foreign exchange risk - Cross- currency swaps 2 | 15 | -18 | -3
1 Ineffectiveness booked in Operating profit. 2 Ineffectiveness booked in Net financial items.

Breakdown of cash flow hedging reserve and net investment hedges in equity 2022

EUR million | At 1 Jan 2022 | Change in fair value recognised in OCI/CTA | Reclassified from OCI to profit and loss | Reclassified to non- financial assets | Tax impact | At 31 Dec 2022
Foreign exchange risk - Operational cash flow hedging | -21 | -82 | 107 | 3 | -5 | 2
Commodity price risk - Commodity swaps | 23 | 41 | -52 | 0 | 3 | 15
Interest rate risk - Interest rate swaps | -4 | 33 | 0 | 0 | -7 | 23
Interest rate and foreign exchange risk - Cross-currency swaps | -1 | 0 | 2 | 0 | 0 | 1
Cost of hedging reserve | -1 | 0 | 0 | 0 | 0 | -1
Total cash flow hedge reserve in OCI | -4 | -8 | 57 | 3 | -9 | 39
Foreign exchange risk - Net investment hedges | 14 | -16 | 0 | 0 | 3 | 1
Total net investment hedges in CTA | 14 | -16 | 0 | 0 | 3 | 1
Total hedging reserves | 10 | -24 | 57 | 3 | -6 | 40

Breakdown of cash flow hedging reserve and net investment hedges in equity 2021

EUR million | At 1 Jan 2021 | Change in fair value recognised in OCI/CTA | Reclassified from OCI to profit and loss | Tax impact | At 31 Dec 2021
Foreign exchange risk - Operational cash flow hedging | 39 | -66 | -10 | 15 | -21
Commodity price risk - Commodity swaps | 3 | 60 | -34 | -6 | 23
Interest rate risk - Interest rate swaps | -13 | 11 | 0 | -2 | -4
Interest rate and foreign exchange risk - Cross-currency swaps | -9 | 33 | -25 | 0 | -1
Cost of hedging reserve | 0 | -2 | 0 | 0 | -1
Total cash flow hedge reserve in OCI | 20 | 37 | -69 | 8 | -4
Foreign exchange risk - Net investment hedges | 30 | -20 | 0 | 4 | 14
Total net investment hedges in CTA | 30 | -20 | 0 | 4 | 14
Total hedging reserves | 51 | 17 | -69 | 12 | 10

Financial impact of netting for instruments subject to an enforceable master netting
agreement 2022

| Not offset in the statement of financial position |
EUR million | Gross amount of recognised financial instruments | Related liabilities (-) or assets (+) subject to master netting agreements | Collateral received (-) or given (+) | Net exposure
Derivative assets | 95 | -30 | 0 | 65
Derivative liabilities | -51 | 30 | 0 | -21

Financial impact of netting for instruments subject to an enforceable master netting
agreement 2021

| Not offset in the statement of financial position |
EUR million | Gross amount of recognised financial instruments | Related liabilities (-) or assets (+) subject to master netting agreements | Collateral received (-) or given (+) | Net exposure
Derivative assets | 38 | -16 | 0 | 22
Derivative liabilities | -71 | 16 | 0 | -56

The Group enters into derivative transactions under master netting agreements agreed with
each counterparty. In case of an unlikely credit event, such as default, all outstanding
transactions under the agreements are terminated, and only a single net amount per
counterparty is payable for settlement of all transactions. The agreements do not meet the
criteria for offsetting in the statement of financial position, because offsetting is enforceable only
in the occurrence of certain future events.
78
Note 28 Cumulative translation adjustment and equity hedging
Accounting principles
The Group operates internationally and is thus exposed to currency risks arising from exchange
rate fluctuations on the value of its net investment in non-euro entities. Exchange rate
differences arising from the retranslation of net investments in foreign non-euro entities, and
financial instruments that are designated as hedges of such investments, are recognised directly
in equity in the cumulative translation adjustment (CTA). Movements in CTA (including related
hedges) are shown in the consolidated statement of comprehensive income.
The cumulative translation adjustments related to disposed and liquidated entities are
combined with their gain or loss on disposal. The CTA is recycled in the consolidated income
statement upon disposal and liquidation.
T he Group policy for translation risk exposure is to minimise this by funding assets in the
same currency whenever economically viable, but if matching the assets and liabilities in the
same currency is not possible, hedging of the remaining translation risk may take place. The
Group has also applied net investment loan accounting for certain intragroup loans for which
settlement is neither planned nor likely to occur in the foreseeable future. These are in
substance, a part of the entity’s net investment in the foreign operation.
Cumulative translation adjustment - movement

| Year ended 31 December
EUR million | 2022 | 2021
At 1 January |  |
CTA on net investments | -235 | -292
Net investment hedges and loans | 48 | 34
Income tax related to hedges and loans | -8 | -10
Net CTA in equity | -195 | -267
CTA movement OCI |  |
CTA movement | -244 | 42
CTA release through income statement | 47 | 14
Net investment hedges and loans | -27 | 14
Income tax related to hedges and loans | 3 | 2
CTA movement OCI total | -220 | 72
At 31 December |  |
CTA on net investments | -432 | -235
Net investment hedges and loans | 21 | 48
Income tax related to hedges and loans | -5 | -8
Net CTA in equity | -415 | -195

In 2022 the release of cumulative translation adjustments to the income statement amounted to
a loss of EUR 47 million and was related to disposal of Russian Packaging Solutions, Wood
Products and Forest operations. After the release, there is no CTA remaining related to Russian
ruble. In 2021 the release to the income statement amounted to a loss of EUR 14 million and
was mainly related to the divestment of 20% ownership in Arauco Florestal Arapoti S.A.
Cumulative translation adjustment - financial position

| As at 31 December
| Cumulative Translation Adjustments (CTA) | Net investment hedges and loans | Net CTA in the statement of financial position
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Brazil | -255 | -281 | 0 | 0 | -255 | -281
China | 131 | 83 | 10 | 28 | 141 | 111
Czech Republic | 43 | 38 | -9 | -9 | 34 | 29
Poland | -59 | -52 | 17 | 17 | -42 | -35
Russia | 0 | -81 | 0 | 0 | 0 | -81
Sweden | -543 | -97 | 47 | 47 | -497 | -50
Uruguay (USD) | 248 | 154 | -44 | -34 | 204 | 119
USA | 8 | 4 | 0 | 0 | 8 | 4
Others | -4 | -3 | 0 | 0 | -4 | -3
CTA before Tax | -432 | -235 | 21 | 48 | -411 | -187
Taxes | 0 | 0 | -5 | -8 | -5 | -8
Net CTA in Equity | -432 | -235 | 17 | 40 | -415 | -195

The main movements in CTA in 2022 were a gain of EUR 98 (gain of EUR 116) million related to
the US dollar, a loss of EUR 446 (loss of EUR 103) million related to the Swedish crown and a
gain of EUR 48 (gain of EUR 9) million related to Chinese renminbi. The net amount of hedging
loss included in the CTA during the period amounted to EUR 24 (gain EUR 16) million.
Hedging instruments and unrealised hedge losses

| As at 31 December
| Nominal amount (Currency) | Nominal amount (EUR) | Unrealised losses (EUR)
EUR million | 2022 | 2021 | 2022 | 2021 | 2022 | 2021
Borrowings |  |  |  |  |  |
USD area | 300 | 300 | 281 | 265 | -41 | -28
Total hedging |  |  | 281 | 265 | -41 | -28

The Group is currently only hedging its equity exposure to the US dollar arising from its joint
operation located in Uruguay with USD functional currenc y.
79
Note 29 Commitments and contingencies
Accounting principles
Guarantees
The guarantees entered into with financial institutions and other credit guarantors generally
oblige the group to make payment in the event of default by the borrower. The guarantees have
an off-balance sheet credit risk representing the accounting loss that would be recognised at the
reporting date if the counterparties fail to perform completely as contracted. The credit risk
amounts are equal to the contract sums, assuming the amounts are not paid in full and are
irrecoverable from other parties.
Commitments

| As at 31 December
EUR million | 2022 | 2021
On own behalf |  |
Guarantees | 14 | 15
On behalf of equity accounted investments |  |
Guarantees | 5 | 0
On behalf of others |  |
Guarantees | 5 | 6
Other commitments | 36 | 36
Total | 60 | 57
Guarantees 1 | 24 | 21
Other commitments 1 | 36 | 36
Total | 60 | 57

1 The comparative figures have been restated due to a reclassification from other commitments to guarantees.
In 2022, the Group’s commitments amounted to EUR 60 (EUR 57) million. In addition, the parent
company Stora Enso Oyj has guaranteed the liabilities of many of its subsidiaries and joint
operations up to 826 EUR (EUR 1,126) million as of 31 December 2022.
Capital commitments

| As at 31 December
EUR million | 2022 | 2021
Total | 593 | 220

Capital expenditure commitments are not recognised in the balance sheet and these include the
Group’s share of direct capital expenditure contracts in joint operations. The largest
commitments in relation to capital expenditure relate to the mill conversion at Oulu site in
Finland, the board production expansion at Skoghall site in Sweden and the wood handling
upgrade at Imatra site in Finland.
Contingent liabilities
Stora Enso has undertaken significant restructuring actions in recent years which have included
the divestment of companies, sale of assets and mill closures. These transactions include a risk
of possible environmental or other obligations the existence of which would be confirmed only by
the occurrence or non-occurrence of one or more uncertain future events not wholly within the
control of the Group. A provision has been recognised for obligations for which the related
amount can be estimated reliably and for which the related future cost is considered to be at
least probable.
Stora Enso has been granted various investment subsidies and has given certain investment
commitments in several countries e.g. Finland, China and Sweden. If commitments to planning
conditions are not met, local officials may pursue administrative measures to reclaim some of
the formerly granted investment subsidies or to impose penalties on Stora Enso, and the
outcome of such a process could result in adverse financial impact on Stora Enso.
The Group announced its intention in December 2022 to divest its consumer board
production and forest operations sites in Beihai, China. As previously disclosed, Stora Enso has
been granted investment subsidies and has given certain investment commitments in China.
There is a risk that the majority owned local Chinese company may be subject to a claim based
on alleged costs resulting from certain uncompleted investment commitments. Given the specific
mitigating circumstances surrounding the investment case as a whole, Stora Enso does not
consider it to be probable that this situation would result in an outflow of economic benefits that
would be material to the Group. The Company continues to monitor the situation as the
divestment process proceeds.
Stora Enso is party to legal proceedings that arise in the ordinary course of business and
which primarily involve claims arising out of commercial law. The management does not
consider that liabilities related to such proceedings before insurance recoveries, if any, are likely
to be material to the Group’s financial condition or results of operations.
Veracel
On 11 July 2008, Stora Enso announced that a federal judge in Brazil had issued a decision
claiming that the permits issued by the State of Bahia for the operations of Stora Enso’s joint
operations company Veracel were not valid. The judge also ordered Veracel to take certain
actions, including reforestation with native trees on part of Veracel’s plantations and a possible
fine of, at the time of the decision, BRL 20 (EUR 4) million. Veracel disputes the decision and
has filed an appeal against it. Veracel operates in full compliance with all Brazilian laws and has
obtained all the necessary environmental and operating licences for its industrial and forestry
activities from the relevant authorities. In November 2008, a Federal Court suspended the
effects of the decision. No provisions have been recorded in Veracel’s or Stora Enso’s accounts
for the reforestation or the possible fine.
80
Note 30 Group companies

|  | Group ownership, % | Group ownership, %
Subsidiaries | Country | 2022 | 2021
A/O Ladenso | Russia | 100.00 | 100.00
Anjala Fiber & Energy Oy | Finland | 100.00 | 100.00
AO Stora Enso | Russia | 0.00 | 100.00
AS Stora Enso Latvija | Latvia | 100.00 | 100.00
Bergnät 1 AB | Sweden | 100.00 | 100.00
Beta Skog 1 AB | Sweden | 100.00 | 0.00
Cellutech AB | Sweden | 100.00 | 100.00
Centrum Dystrybucji i Obróbki Drewna Sp. z.o.o. | Poland | 100.00 | 100.00
Changzhou Stora Enso Packaging Technology Co. Ltd. | China | 100.00 | 100.00
DanFiber A/S | Denmark | 51.00 | 51.00
Dongguan Stora Enso Inpac Packaging Co. Ltd. | China | 100.00 | 100.00
DuraSense AB (formerly Box Inc.) | Sweden | 100.00 | 100.00
Efora Oy | Finland | 100.00 | 100.00
Enso Alueverkko Oy | Finland | 100.00 | 100.00
Euro - Timber, spol. s.r.o. | Slovak Republic | 100.00 | 100.00
FPB Holding GmbH & Co. KG | Germany | 0.00 | 99.98
Guangxi Stora Enso Forestry Co. Ltd. | China | 89.50 | 89.50
Herman Andersson Oy | Finland | 100.00 | 100.00
HESPOL Sp. z.o.o. | Poland | 100.00 | 100.00
Jiashan Stora Enso Inpac Packaging Co. Ltd. | China | 100.00 | 100.00
Lignode AB | Sweden | 100.00 | 0.00
Lignode Holding Oy | Finland | 100.00 | 0.00
Lignode Oy | Finland | 100.00 | 0.00
Lumipaper Ltd | UK | 100.00 | 100.00
Lumipaper NV | Belgium | 100.00 | 100.00
Mena Wood Oy Ltd | Finland | 100.00 | 100.00
OAO Olonetsles | Russia | 0.00 | 99.48
OOO Setles | Russia | 0.00 | 100.00
OOO Setnovo | Russia | 0.00 | 100.00
OOO Stora Enso Forest West | Russia | 0.00 | 100.00
OOO Stora Enso Packaging BB | Russia | 0.00 | 100.00
OOO Stora Transport | Russia | 0.00 | 100.00
OOO Terminal | Russia | 0.00 | 100.00
Primaskog 9 AB | Sweden | 0.00 | 100.00
Selfly Store Oy | Finland | 100.00 | 100.00
Skogsutveckling Syd AB | Sweden | 66.67 | 66.67
Stora Enso China Packaging (HK) Co., Limited | Hong Kong | 100.00 | 100.00
Stora Enso (Guangxi) Forestry Company Ltd. | China | 80.08 | 80.08
Stora Enso (Guangxi) Packaging Company Ltd. | China | 80.08 | 80.08
Stora Enso (HK) Ltd | Hong Kong | 100.00 | 100.00
Stora Enso (Southern Africa) (Pty) Ltd | South Africa | 100.00 | 100.00
Stora Enso AB | Sweden | 100.00 | 100.00
Stora Enso Amsterdam B.V. | Netherlands | 100.00 | 100.00
Stora Enso Arapoti Holding Florestal S.A. | Brazil | 100.00 | 100.00
Stora Enso Australia Pty Ltd | Australia | 100.00 | 100.00
Stora Enso Austria GmbH | Austria | 0.00 | 100.00
Stora Enso Belgium NV | Belgium | 100.00 | 100.00

|  | Group ownership, % | Group ownership, %
Subsidiaries | Country | 2022 | 2021
Stora Enso Bergskog 2 AB | Sweden | 100.00 | 100.00
Stora Enso Bergskog 3 AB | Sweden | 100.00 | 0.00
Stora Enso Bioenergi AB | Sweden | 0.00 | 100.00
Stora Enso Bois SAS | France | 100.00 | 100.00
Stora Enso Brasil Ltda | Brazil | 100.00 | 100.00
Stora Enso China Co., Ltd | China | 100.00 | 100.00
Stora Enso China Holdings AB | Sweden | 100.00 | 100.00
Stora Enso Corbehem SAS | France | 100.00 | 100.00
Stora Enso Danmark A/S | Denmark | 100.00 | 100.00
Stora Enso Eesti AS | Estonia | 100.00 | 100.00
Stora Enso Espana S.A.U | Spain | 100.00 | 100.00
Stora Enso Fors AB | Sweden | 100.00 | 100.00
Stora Enso France SAS | France | 100.00 | 100.00
Stora Enso Germany GmbH | Germany | 100.00 | 100.00
Stora Enso Holding France SAS | France | 100.00 | 100.00
Stora Enso Holdings UK Ltd | UK | 100.00 | 100.00
Stora Enso Hylte Bruk AB | Sweden | 100.00 | 0.00
Stora Enso Ingerois Oy | Finland | 100.00 | 100.00
Stora Enso Inpac Corrugated Packaging (Hebei) Company Limited | China | 100.00 | 100.00
Stora Enso Inpac Hebei Protective Packaging Co., Ltd. | China | 100.00 | 100.00
Stora Enso Inpac Packaging Co. Ltd | China | 100.00 | 100.00
Stora Enso International Oy | Finland | 100.00 | 100.00
Stora Enso Italia Srl | Italy | 100.00 | 100.00
Stora Enso Japan K.K. | Japan | 100.00 | 100.00
Stora Enso Kabel GmbH | Germany | 0.00 | 99.98
Stora Enso Kvarnsveden Industriutveckling AB | Sweden | 100.00 | 100.00
Stora Enso Langerbrugge NV | Belgium | 100.00 | 100.00
Stora Enso LLC | Ukraine | 100.00 | 100.00
Stora Enso Maxau GmbH | Germany | 100.00 | 100.00
Stora Enso Mexico S.A. | Mexico | 100.00 | 100.00
Stora Enso Middle East DMCC | United Arab Emirates | 100.00 | 100.00
Stora Enso Narew Sp.z.o.o. | Poland | 100.00 | 100.00
Stora Enso North American Sales, LLC | USA | 100.00 | 100.00
Stora Enso Nymölla Paper AB | Sweden | 100.00 | 0.00
Stora Enso Oulu Oy | Finland | 100.00 | 100.00
Stora Enso Packaging AB | Sweden | 100.00 | 100.00
Stora Enso Packaging AS | Estonia | 100.00 | 100.00
Stora Enso Packaging Oy | Finland | 100.00 | 100.00
Stora Enso Packaging SIA | Latvia | 100.00 | 100.00
Stora Enso Packaging UAB | Lithuania | 100.00 | 100.00
Stora Enso Paper AB | Sweden | 100.00 | 100.00
Stora Enso Paper France SAS | France | 100.00 | 100.00
Stora Enso Paper GmbH | Germany | 100.00 | 100.00
Stora Enso Paper Oy | Finland | 100.00 | 100.00
Stora Enso Paper UK Ltd | UK | 100.00 | 100.00
Stora Enso Pension Trust Ltd. | UK | 100.00 | 100.00

81

|  | Group ownership, % | Group ownership, %
Subsidiaries | Country | 2022 | 2021
Stora Enso Plantor AB | Sweden | 0.00 | 100.00
Stora Enso Poland S.A. | Poland | 100.00 | 100.00
Stora Enso Polska Sp.z.o.o. | Poland | 100.00 | 100.00
Stora Enso Portugal Lda | Portugal | 100.00 | 100.00
Stora Enso Praha s.r.o. | Czech Republic | 100.00 | 100.00
Stora Enso Publication Papers Oy Ltd | Finland | 100.00 | 100.00
Stora Enso Pulp AB | Sweden | 100.00 | 100.00
Stora Enso Pulp and Paper Asia AB | Sweden | 94.21 | 94.21
Stora Enso Skog AB | Sweden | 100.00 | 100.00
Stora Enso Skog AS | Norway | 100.00 | 100.00
Stora Enso Skog och Mark AB | Sweden | 100.00 | 100.00
Stora Enso South East Asia Pte Ltd | Singapore | 100.00 | 100.00
Stora Enso Timber AB | Sweden | 100.00 | 100.00
Stora Enso Timber DIY Products B.V. | Netherlands | 100.00 | 100.00
Stora Enso Treasury Stockholm AB | Sweden | 100.00 | 100.00
Stora Enso Turkey Karton Ve Kağıt Ticaret Anonim Sirketi | Turkey | 100.00 | 0.00
Stora Enso UK Limited | UK | 100.00 | 100.00
Stora Enso US Inc. | USA | 100.00 | 100.00
Stora Enso Veitsiluoto Oy | Finland | 100.00 | 100.00
Stora Enso Verwaltungs GmbH | Germany | 0.00 | 100.00
Stora Enso Wood Products d.o.o. Koper | Slovenia | 100.00 | 100.00
Stora Enso Wood Products GmbH | Austria | 100.00 | 100.00
Stora Enso Wood Products Japan K.K. | Japan | 100.00 | 100.00
Stora Enso Wood Products Planá s.r.o. | Czech Republic | 100.00 | 100.00
Stora Enso Wood Products Sp.z.o.o. | Poland | 100.00 | 100.00
Stora Enso Wood Products Zdirec s.r.o. | Czech Republic | 100.00 | 100.00
Stora Enso WP Bad St. Leonhard GmbH | Austria | 100.00 | 100.00
Stora Enso WP HV s.r.o. | Czech Republic | 100.00 | 100.00
Stora Kopparbergs Bergslags AB | Sweden | 100.00 | 100.00
Sydved AB | Sweden | 66.67 | 66.67
Södra Norrlands Hamnbolag nr 1 AB | Sweden | 100.00 | 0.00
UAB Stora Enso Lietuva | Lithuania | 100.00 | 100.00
Virdia B2X, LLC | USA | 100.00 | 100.00
Virdia LLC | USA | 100.00 | 100.00
Virdia Ltd | Israel | 100.00 | 100.00
VLAR Papier NV | Belgium | 0.00 | 100.00

|  | Group ownership, % | Group ownership, %
Subsidiaries | Country | 2022 | 2021
A.C.D.F. Industrie | France | 35.00 | 0.00
Encore Ympäristöpalvelut Oy | Finland | 0.00 | 30.41
Honkalahden Teollisuuslaituri Oy | Finland | 50.00 | 50.00
Kemira Cell Sp.z.o.o. | Poland | 45.00 | 45.00
Metsäteho Oy | Finland | 23.95 | 23.95
Oy Keskuslaboratorio - Centrallaboratorium Ab | Finland | 32.24 | 32.24
Perkaus Oy | Finland | 33.33 | 33.33
Pressretur AB | Sweden | 0.00 | 50.00
SELF Logistika SIA | Latvia | 50.00 | 50.00
Steveco Oy | Finland | 34.39 | 34.39
Suomen Keräyspaperi Tuottajayhteisö Oy | Finland | 40.09 | 40.09
SweTree Technologies AB | Sweden | 23.83 | 23.83
Tornator Oyj | Finland | 41.00 | 41.00
Trätåg AB | Sweden | 50.00 | 50.00
TreeToTextile AB | Sweden | 28.94 | 27.96
ZMP GMBH | Austria | 30.00 | 30.00
Österbergs Förpackningsmaskiner AB | Sweden | 50.00 | 50.00
|  | Group ownership, % | Group ownership, %
Other companies | Country | 2022 | 2021
AMEXCI AB | Sweden | 9.10 | 9.10
Arevo AB | Sweden | 7.89 | 7.89
Clic Innovation Oy | Finland | 9.87 | 9.87
Combient AB | Sweden | 5.40 | 5.40
East Office of Finnish Industries Oy | Finland | 4.00 | 4.00
Packages Limited | Pakistan | 6.40 | 6.40
Pohjolan Voima Oy | Finland | 15.61 | 15.61
PulPac AB | Sweden | 10.30 | 0.00
Radioskog AB | Sweden | 10.00 | 10.00
RK Returkartong AB | Sweden | 8.40 | 8.40
SSG Standard Solutions Group AB | Sweden | 14.29 | 14.29
Suomen Puukauppa Oy | Finland | 10.74 | 0.00
Sölvesborgs Stuveri & Hamn AB | Sweden | 7.36 | 7.36
Union Developement Récup. Pap. | France | 10.70 | 10.70
|  | Group ownership, % | Group ownership, %
Joint operations | Country | 2022 | 2021
Celulosa y Energia Punta Pereira S.A. | Uruguay | 50.00 | 50.00
El Esparragal Asociación Agraria de Responsabilidad Limitada | Uruguay | 50.00 | 50.00
Eufores S.A. | Uruguay | 50.00 | 50.00
Forestal Cono Sur S.A. | Uruguay | 50.00 | 50.00
Ongar S.A. | Uruguay | 50.00 | 50.00
Stora Enso Uruguay S/A | Uruguay | 50.00 | 50.00
Terminal Logística e Industrial M`Bopocuá S.A. | Uruguay | 50.00 | 50.00
Veracel Celulose SA | Brazil | 50.00 | 50.00
Zona Franca Punta Pereira S.A. | Uruguay | 50.00 | 50.00

82
Note 31 Related party transactions
Balances and transactions between Stora Enso and its subsidiaries and joint operations have
been eliminated on consolidation and are not disclosed in this note. For the other entities which
are classified as the Group's related parties and disclosed in this note, their subsidiary
companies are also considered as related parties.
The Group has classified Solidium Oy as a related party. Solidium Oy is entirely owned by the
State of Finland, and it owned 10.7% of Stora Enso shares and 27.3% of all votes on 31
December 2022. The group has applied an exemption, as stated in IAS 24 paragraph 25, not to
disclose transactions and outstanding balances with government-related entities.
The Group has classified FAM AB and Wallenberg Investments AB as related parties. FAM
AB owned 10.2% of Stora Enso shares and 27.3% of all votes on 31 December 2022. FAM AB is
completely owned by Wallenberg Investments AB.
The key management personnel of the Group are the members of the Group Leadership
Team and the Board of Directors. The compensation of key management personnel is presented
in Note 7 Board and executive remuneration.
In the ordinary course of business, the Group engages in transactions on commercial terms
with equity accounted investments and other related parties that are not any more favourable
than those that would be available to other third parties – with the exception of Veracel. Stora
Enso intends to continue with transactions on a similar basis with its equity accounted
investments, further details of which are shown in Note 13 Equity accounted investments.
Group companies, including subsidiary companies and joint operations, are listed in Note 30
Group companies.
Paper for recycling
The Group owns non-controlling interests in several paper recyclers, from which paper for
recycling is purchased at market prices.
Forest assets and wood procurement
The Group has a 41.0% interest in Tornator with the remaining 59.0% being held mainly by
Finnish institutional investors. Stora Enso has long-term purchase contracts of wood at market
prices with the Tornator Group, and in 2022 purchases of 3 (2) million cubic metres came to
EUR 126 (82) million.
The Group procures wood at market prices from Kopparfors Fastigheter AB, a fully owned
subsidiary of Kopparfors Skogar AB, which is completely owned by FAM AB. In 2022 the
purchases from the related party amounted to EUR 23 (29) million. At the end of 2022 the Group
had EUR 6 (3) million of open payables to the related party.
Stevedoring
The Group owns 34.4% of shares in Steveco Oy, a Finnish company engaged in loading and
unloading vessels. The other shareholders in Steveco are UPM-Kymmene, Finnlines and
Ahlström Capital. The stevedoring services are provided by Steveco at market prices and in
2022 amounted to EUR 27 (26) million.
Note 32 Earnings per share
Accounting principles
Basic earnings per share, attributable to the owners of the parent company, are calculated by
dividing the net profit attributable to shareholders by the weighted average number of ordinary
shares in issue during the year, excluding ordinary shares purchased by the group and held as
treasury shares. Diluted earnings per share are calculated by adjusting the weighted average
number of ordinary shares plus the diluted effect of all potential dilutive ordinary shares, such as
shares from share-based payments.
Earnings per share

| Year Ended 31 December
| 2022 | 2021
Net profit for the period attributable to the owners of the parent, EUR million | 1,550 | 1,266
Total comprehensive income attributable to the owners of the parent, EUR million | 2,278 | 2,110
Weighted average number of A and R shares | 788,619,987 | 788,619,987
Weighted average number of share awards | 771,150 | 505,705
Weighted diluted number of shares | 789,391,137 | 789,125,692
Basic Earnings per Share, EUR | 1.97 | 1.61
Diluted Earnings per Share, EUR | 1.96 | 1.60
Total Comprehensive Income Attributable to the Owners of the Parent per Share, EUR | 2.89 | 2.67

Note 33 Events after the reporting period
The Group has had the following non-adjusting events after the reporting period
At 6 January 2023 Stora Enso completed the transaction to acquire De Jong Packaging
Group.
In the beginning of January 2023, Stora Enso completed the divestment of its Nymölla paper
production site in Sweden, and all related assets to Sylvamo, a US-based global producer of
uncoated paper.
In January 2023, Stora Enso signed an agreement to divest its Hylte paper production site in
Sweden to Sweden Timber.
More details about the above transactions are presented in Note 4 Acquisitions, disposals
and assets held for sale.
As of 1 January 2023 and due to the divestments and reorganisation of retained Paper
division operations, Stora Enso's segment reporting will be changed. According to the changes,
the Paper division will be discontinued and will not reported as a separate segment going
forward. The Maxau, Nymölla and Hylte sites together with all previously sold and closed sites
will be reported as part of the segment Other going forward. The remaining sites Langerbrugge
and Anjala will be reported as part of the Packaging Materials division. Comparative figures will
be restated accordingly during the first quarter of 2023.
As of 1 January 2023 emerging business related units in Packaging Solutions division will be
moved to segment Other. These units are including Formed Fiber, Circular Solutions
(biocomposites) and Selfly Stores. Comparative figures will be restated accordingly.
83
Parent company Stora Enso Oyj financial statements
Parent company income statement

|  | Year ended 31 December
EUR million | Note | 2022 | 2021
Sales | 2 | 3,325 | 2,822
Changes in inventories of finished goods and work in progress + / - |  | 86 | 16
Production for own use |  | 2 | 1
Other operating income | 3 | 703 | 308
Materials and services | 4 | -2,288 | -1,864
Personnel expenses | 5 | -320 | -259
Depreciation and impairment | 6 | -133 | -129
Other operating expenses | 7 | -889 | -490
|  | 2,839 | 2,417
Operating profit |  | 485 | 405
Financial income and expenses | 9 | 290 | 351
Profit before Appropriations and Taxes |  | 775 | 756
Appropriations | 10 | -331 | -119
Income tax expense | 11 | -28 | 0
Profit for the period |  | 416 | 637

Parent company statement of financial position

|  | As at 31 December
EUR million | Note | 2022 | 2021
Assets |  |  |
Non-current assets |  |  |
Intangible assets | 13 | 49 | 49
Tangible assets | 13 | 1,032 | 987
Investments | 14 | 8,187 | 8,234
Non-current assets total |  | 9,269 | 9,270
Current assets |  |  |
Inventories | 15 | 574 | 387
Short-term receivables | 16 | 1,278 | 1,314
Financial securities | 17 | 1,130 | 607
Cash in hand and at bank |  | 1,117 | 744
Total current assets |  | 4,099 | 3,051
Total assets |  | 13,368 | 12,322
Equity and liabilities |  |  |
Equity | 18 |  |
Share capital |  | 1,342 | 1,342
Share premium |  | 3,639 | 3,639
Fair value reserve |  | 25 | -6
Invested non-restricted equity fund |  | 633 | 633
Retained earnings |  | 922 | 719
Profit for the period |  | 416 | 637
Total equity |  | 6,977 | 6,964
Accumulated appropriations | 19 | 290 | 234
Obligatory provisions | 20 | 25 | 12
Liabilities |  |  |
Non-current liabilities | 22 | 2,265 | 2,513
Current liabilities | 23 | 3,811 | 2,599
Total liabilities |  | 6,076 | 5,113
Total equity and liabilities |  | 13,368 | 12,322

84
Parent company cash flow statement

| Year ended 31 December
EUR million | 2022 | 2021
Cash provided by operating activities |  |
Profit for the period | 416 | 637
Adjustments and reversal of non-cash items: |  |
Direct taxes | 28 | 0
Appropriations | 331 | 119
Depreciation according to plan and impairment | 133 | 129
Unrealised foreign exchange gains and losses | 18 | 10
Other non-cash items | 13 | -84
Financial income and expenses | -290 | -351
Change in working capital: |  |
Increase(-)/decrease(+) |  |
in current non-interest-bearing receivables | -198 | -108
Increase(-)/decrease(+) in inventories | -187 | -42
Increase(+)/decrease(-) |  |
in current non-interest-bearing liabilities | 199 | 159
Cash flow from operating activities before financial items and taxes | 463 | 471
Interest received from operating activities | 58 | 41
Interest paid from operating activities | -79 | -74
Dividends received from operating activities | 626 | 502
Other financial items, net | -57 | -46
Direct taxes paid | -2 | -2
Cash provided by operating activities | 1,009 | 892
Net cash provided by investing activities |  |
Investments in tangible and intangible assets | -186 | -140
Capital gains from sale of tangible and intangible assets | 0 | 3
Investments in other financial assets | 0 | -13
Investments in subsidiary shares and other capital contributions | -374 | -138
Proceeds from disposal of subsidiary shares and other repayment of capital | 0 | -98
Proceeds from disposal of shares in equity accounted investments and repayment of capital | 10 | 0
Payments of non-current loan receivables | -626 | -706
Proceeds from non-current loan receivables | 944 | 120
Net cash provided by investing activities | -233 | -972

| Year ended 31 December
EUR million | 2022 | 2021
Cash flow from financing activities |  |
Proceeds from (issue of) long-term liabilities | 350 | 1,040
Proceeds from (payment of) long-term liabilities | -560 | -1,431
Proceeds from (issue of) short-term liabilities | 1,587 | 722
Proceeds from (payment of) short-term liabilities | -546 | -570
Dividends paid | -434 | -250
Group contributions received | -275 | -14
Cash flow from financing activities | 121 | -503
Net change in cash and cash equivalents | 897 | -584
Translation differences | -1 | -18
Cash and cash equivalents at start of year | 1,350 | 1,953
Cash and cash equivalents at year end | 2,247 | 1,350
Cash and cash equivalents at year end includes: |  |
Financial securities | 1,130 | 607
Cash in hand and at bank | 1,117 | 744
Cash and cash equivalents total | 2,247 | 1,350

85
Notes to the parent company financial statements
Note 1 Ac counting principles
The financial statements of Stora Enso Oyj have been prepared in accordance with the Finnish
Accounting Act and other current rules and regulations concerning financial statements in
Finlan d. The financial statements are presented in millions of euros and rounded and therefore
the sum of individual figures might deviate from the presented total figure.
Derivative contracts
Stora Enso is exposed to several financial market risks that the Group is responsible for
managing under policies approved by the Board of Directors. The objective is to have cost-
effective funding in Group companies and to manage financial risks using financial instruments
in order to decrease earnings volatility. The main exposures for the Group are interest rate risk,
currency risk, funding risk and commodity price risk, especially for fiber and energy. The parent
company manages these risks centrally in the Group. The Group’s risk management principles
are presented in more detail in Note 24 Financial Risk Management to the consolidated financial
statements.
Derivative contracts are measured at fair value on the balance sheet. Derivatives with
external counterparties that are subject to hedge accounting are recognised as financial assets
and liabilities at fair value through the income statement in the same manner as the parent
company’s derivatives with other Group companies as counterparties. The parent company’s
derivative contracts that are used to hedge the parent company’s own cash flow are measured
at fair value, and the change in fair value (effective part) is recognised, in line with hedge
accounting principles, in the fair value reserve in equity on the balance sheet, while the
ineffective part is recognised in the parent company’s income statement. The change in fair
value of derivatives not included in hedge accounting is entered immediately in the income
statement.
Interest income and expenses related to derivatives that are used to manage the interest rate
risk are allocated over the contract period and are used to adjust interest expenses related to
hedged loans. Option premiums are recognised as advance payments until the options mature.
With regard to derivatives, more information about the measurement principles, fair values
and changes in fair value is provided in Note 25.
Foreign currency transactions
Transactions in foreign currencies are recorded at the rate of exchange prevailing at the
transaction date, but at the end of the month foreign-currency-denominated receivables and
liabilities are translated using the month-end exchange rate.
Equity incentive schemes
The employees covered by the scope of Stora Enso Oyj’s share-based incentive schemes are
awarded with shares in the company. The awarded shares and the costs of the schemes are
recognised in the income statement once the shares have been earned. The principles of the
Group’s share opportunity programmes are presented in more detail in Note 21 (Employee
variable compensation and equity incentive schemes) to the consolidated financial statements.
Pensions
Statutory pension security is arranged through employment pension insurance companies
outside the Group. Some employees have additional pension security through life insurance
companies outside the Group. Pension contributions are allocated in accordance with
performance-based salaries and wages for the financial period.
Non-current assets
The balance sheet value of intangible and tangible assets is their direct acquisition cost less
depreciation according to plan and any impairment. Depreciation according to plan is recognised
for intangible and tangible assets, based on their expected useful lives.

Depreciation is based on the following useful lives: |
Buildings and structures | 10–50 years
Production machinery and equipment | 10–20 years
Light machinery and equipment | 3–5 years
Intellectual property rights | 3–20 years

No depreciation is recognised for land and water areas.
Loan receivables are debt instruments with fixed or determinable payments that are not quoted
on an active market. They are recorded initially at fair value and subsequently measured at an
amortised cost. Investments in subsidiaries and other companies are measured at cost, or fair
value in case the fair value is less than cost.
Inventories
Inventories are measured at acquisition cost or at net realisable value if lower. Acquisition cost is
determined using the FIFO method or the weighted average cost method. The cost of finished
goods and work in progress comprises raw materials, direct labour, depreciation and other direct
costs, as well as the related production overhead. Net realisable value is the estimated selling
price less the costs of completion and sale.
Leasing
Leasing payments are recognised in other operating expenses. The remaining leasing payments
under leasing agreements are presented in Note 24 Commitments and Contingencies
Expenditure on research and development
Expenditure on research and development is recognised as an expense for the financial period.
Income taxes
The tax expense on the income statement includes income taxes based on the taxable profit for
the financial period and tax adjustments for previous periods. The parent company does not
recognise deferred tax assets and liabilities, excluding derivatives, in its financial statements.
86
Deferred tax assets and liabilities that can be recognised on the balance sheet are presented in
Note 21.
Obligatory provisions
Future costs and losses that no longer generate corresponding income, to which the company is
committed or by which the company is obligated, are recognised in the income statement
according to their nature and in obligatory provisions on the balance sheet.
Emission rights
During 2022, 0.6 million tonnes of free emission allowances in accordance with the EU
Emissions Trading Directive were allocated to the company. Emission allowances are
recognised through a net cash cost basis, meaning that the difference between the actual
emissions and the emission allowances received is recognised through profit or loss if the actual
emissions are larger than the emission allowances received. During the financial period, the
emissions emitted were estimated at 0.5 million tonnes. The emission rights purchased during
the financial period are recognised in other operating expenses, and the emission rights sold
during the financial period are recognised in other operating income.
At the end of the financial period, the market value of the emission rights was EUR 80.78 per
tonne.
Comparability of the information for the financial period
The operational functions of Efora Oy, Stora Enso's maintenance business subsidiary, were
transferred to the organisations of Stora Enso, Stora Enso Packaging Oy and Stora Enso Oulu
Oy. The maintenance development and support functions were decentralised to the divisions.
Due to these changes, in the transfer of business on 1 January 2022, Efora Oy's personnel,
fixed and current assets and contracts were transferred from Efora Oy to the companies
concerned. In the business transfer, EUR 1.5 million of fixed assets, EUR 1.1 million of
inventories and 543 employees were transferred to Stora Enso Oyj.
During 2022, Stora Enso divested all its subsidiaries in Russia to local management. For more
information, please refer to the Group's financial statements in Note 4.
Other operating income and expenses include an item relating to change of operative model in
the Group.
Note 2 Net sales by division and market area

| Year ended 31 December
EUR million | 2022 | 2021
By division |  |
Packaging Materials | 1,882 | 1,567
Packaging Solutions | 0 | 1
Biomaterials | 296 | 329
Forest | 700 | 759
Wood Products | 228 | 38
Other | 219 | 128
Total | 3,325 | 2,822
Distribution by region |  |
Finland | 1,361 | 1,330
Other Europe | 1,076 | 995
North and South America | 298 | 158
Asia and Oceania | 381 | 227
Africa | 118 | 32
Others | 91 | 80
Total | 3,325 | 2,822

Not e 3 Other operating income

| Year ended 31 December
EUR million | 2022 | 2021
Rent and equivalents | 3 | 3
Gains on sale of fixed assets | 0 | 1
Production and maintenance services | 1 | 4
Subsidies, grants and equivalents | 2 | 1
Administration services | 60 | 177
Proceeds from sales of emission rights | 52 | 21
Other operating income | 586 | 32
Merger profit | 0 | 69
Total | 703 | 308

Other operating income includes an item relating to change of operative model in the Group.
Note 4 Materials and services

| Year ended 31 December
EUR million | 2022 | 2021
Materials and supplies |  |
Purchases during the period | 1,822 | 1,366
Change in inventories +/- | -105 | -30
External services | 571 | 527
Total Materials and Services | 2,288 | 1,864

87
Note 5 Personnel expenses and average number of employees

| Year ended 31 December
EUR million | 2022 | 2021
Salaries and fees | 263 | 211
Statutory employer costs |  |
Pensions | 47 | 38
Other personnel costs | 9 | 9
Total | 320 | 259

Remuneration for the CEO and the members of the Board of Directors
Remuneration for the CEO and the members of the Board of Directors is presented in Note 7 to
the consolidated financial statements.
Pension liabilities for the CEO
Pension liabilities for the CEO are presented in Note 7 to the consolidated financial statements.
Receivables from management
There were no loan receivables from the company’s management.

Average number of employees | 2022 | 2021
Number of employees during the financial period | 4,066 | 3,057

Note 6 Depreciation and impairment

| Year ended 31 December
EUR million | 2022 | 2021
Depreciation according to plan | 133 | 124
Impairment of fixed assets | 1 | 5
Total | 133 | 129
Depreciation and amortisation on each item in the statement of financial position is included under intangible and tangible assets.

Note 7 Other operating expenses

| Year ended 31 December
EUR million | 2022 | 2021
Product freight | 267 | 168
Sales commissions | 55 | 39
Rental costs | 20 | 15
Administration and office services | 319 | 213
Insurance premiums | 12 | 9
Other personnel expenses | 17 | 10
Public and other relations | 4 | 3
Emission rights expenses | 40 | 20
Other operating expenses | 154 | 13
Total | 889 | 490

Other operating expenses includes an item relating to change of operative model in the Group.
Note 8 Auditors’ fees

| Year ended 31 December
EUR million | 2022 | 2021
Audit fees | 1 | 1
Other audit-related fees | 0 | 0
Tax fees | 0 | 0
Other fees | 0 | 0
Total | 2 | 1

Note 9 Financial income and expenses

| Year ended 31 December
EUR million | 2022 | 2021
Dividend income |  |
From Group companies | 601 | 486
From equity accounted investments | 25 | 16
Total | 626 | 503
Interest income from non-current investments |  |
From Group companies | 52 | 41
From equity accounted investments | 0 | 1
From others | 2 | 0
Total | 55 | 42
Other interest and financial income |  |
From Group companies | 20 | -1
From equity accounted investments | 9 | 0
From others | 14 | 10
Total | 44 | 9
Total financial income | 725 | 553
Interest and other financial expenses |  |
To Group companies | -38 | -1
Other financial expenses | -93 | -103
Total | -131 | -103
Impairment on investments |  |
Impairment on investments in non-current assets | -305 | -98
Total financial expenses | -435 | -202
Total financial income and expenses | 290 | 351
The item “Financial Income and Expenses” includes exchange rate gains/losses (net) |  |
The item “Financial Income and Expenses” includes exchange rate gains/losses (net) | -17 | -27

88
Note 10 Appropriations

| Year ended 31 December
EUR million | 2022 | 2021
Difference between depreciation according to plan and depreciation recognised in taxation | -56 | -46
Group contributions paid | -275 | -73
Total appropriations | -331 | -119

Note 11 Income tax expense

| Year ended 31 December
EUR million | 2022 | 2021
Income taxes from primary operations for the period | -28 | 0
Total income tax | -28 | 0

Note 12 Environmental expenses

| Year ended 31 December
EUR million | 2022 | 2021
Materials and services | 43 | 36
Personnel expenses | 3 | 3
Depreciation and impairment | 12 | 12
Total | 58 | 50
Air quality protection | 9 | 9
Wastewater treatment | 25 | 19
Waste management | 15 | 12
Soil and groundwater protection | 1 | 1
Other environmental protection measures | 7 | 9
Total | 58 | 50

Note 13 Intangible and tangible assets

Intangible assets
EUR million | Intellectual property rights | Other non- current expenditure | Advance payments and acquisitions in progress | Total
Acquisition cost 1 Jan | 172 | 22 | 5 | 198
Increases | 3 | 0 | 13 | 16
Decreases | -8 | 0 | 0 | -8
Reclassification | 4 | 1 | -3 | 1
Acquisition cost 31 Dec | 171 | 23 | 14 | 208
Accumulated depreciation and impairment 1 Jan | -130 | -20 | 0 | -150
Accumulated depreciation on decreases and reclassifications | 7 | 0 | 0 | 7
Depreciation for the period | -15 | -1 | 0 | -15
Accumulated depreciation 31 Dec | -138 | -21 | 0 | -158
Book value on 31 December 2022 | 33 | 2 | 14 | 49
Book value on 31 December 2021 | 42 | 2 | 5 | 49

89

Tangible assets |  |  |  |  |  |
EUR million | Land and water areas | Buildings and structures | Plant and equipment | Other tangible assets | Advance payments and acquisitions in progress | Total
Acquisition cost 1 Jan | 18 | 586 | 2,726 | 174 | 149 | 3,654
Increases | 0 | 6 | 72 | 1 | 86 | 166
Decreases | 0 | -9 | -43 | -1 | 0 | -54
Reclassification | 0 | 22 | 98 | 7 | -129 | -1
Acquisition cost 31 Dec | 18 | 605 | 2,853 | 181 | 107 | 3,764
Accumulated depreciation and impairment 1 Jan | 0 | -428 | -2,082 | -159 | 0 | -2,668
Accumulated depreciation on decreases and reclassifications | 0 | 9 | 42 | 1 | 0 | 52
Depreciation for the period | 0 | -14 | -101 | -2 | 0 | -117
Accumulated depreciation 31 Dec | 0 | -433 | -2,141 | -160 | 0 | -2,734
Increase in value 31 Dec | 2 | 0 | 0 | 0 | 0 | 2
Book value on 31 December 2022 | 20 | 173 | 712 | 21 | 107 | 1,032
Book value on 31 December 2021 | 20 | 158 | 644 | 15 | 149 | 987
Production plant and equipment |  |  |  |  |  |
Book value on 31 December 2022 |  |  | 693 |  |  |
Book value on 31 December 2021 |  |  | 624 |  |  |

Advance payments and acquisitions in progress
EUR million | Intangible assets | Buildings and structures | Plant and equipment | Other tangible assets | Total
Acquisition cost 1 Jan | 5 | 1 | 148 | 0 | 154
Increases | 13 | 5 | 81 | 0 | 98
Reclassification | -3 | -1 | -128 | 0 | -132
Acquisition cost 31 Dec | 14 | 5 | 101 | 0 | 121

Tangible assets |  |  |  |  |
Capitalised environmental expenditure |  |  |  |  | 2022
EUR million | Land and water areas | Buildings and structures | Plant and equipment | Other tangible assets | Advance payments and acquisitions in progress | Total
Acquisition cost 1 Jan | 4 | 24 | 51 | 4 | 11 | 95
Increases | 1 | 0 | 9 | 1 | 8 | 18
Depreciations for the period | 0 | -2 | -8 | -1 | 0 | -12
Book value on 31 December 2022 | 4 | 22 | 52 | 5 | 19 | 101
Air quality protection | 1 | 7 | 35 | 0 | 12 | 55
Wastewater treatment | 0 | 2 | 13 | 0 | 4 | 20
Waste management | 2 | 0 | 1 | 3 | 0 | 7
Soil and groundwater protection | 1 | 12 | 2 | 0 | 2 | 18
Noise and vibration prevention | 0 | 0 | 1 | 1 | 0 | 1
| 4 | 22 | 52 | 5 | 19 | 101

|  |  |  |  |  |  | 2021
EUR million | Land and water areas | Buildings and structures | Plant and equipment | Other tangible assets | Advance payments and acquisitions in progress | Total
Acquisition cost 1 Jan | 4 | 26 | 51 | 5 | 3 | 89
Increases | 0 | 0 | 7 | 0 | 8 | 16
Increases due to mergers | 0 | 0 | 0 | 0 | 0 | 1
Depreciations for the period | 0 | -3 | -7 | -1 | 0 | -11
Book value on 31 December 2021 | 4 | 24 | 51 | 4 | 11 | 95
Air quality protection | 1 | 9 | 28 | 0 | 5 | 43
Wastewater treatment | 0 | 2 | 21 | 1 | 4 | 27
Waste management | 3 | 0 | 1 | 2 | 1 | 7
Soil and groundwater protection | 0 | 13 | 2 | 0 | 2 | 17
Noise and vibration prevention | 0 | 0 | 0 | 1 | 0 | 1
| 4 | 24 | 51 | 4 | 11 | 95
In 2022 and 2021, no environmentally based fines, charges or compensation were paid, and no subsidies or grants were received for environmental protection.

90
Note 14 Non-current investments in shares and loan receivables

EUR million | Shares in Group companies | Loan receivables from Group companies | Shares in associated companies | Loan receivables from associated companies | Other shares | Other receivables | Total investments
Acquisition cost 1 Jan | 6,514 | 1,578 | 37 | 2 | 193 | 48 | 8,372
Increases | 374 | 328 | 0 |  | 0 | 112 | 815
Decreases | -44 | -479 | 0 |  | 0 | -58 | -581
Acquisition cost 31 Dec | 6,845 | 1,428 | 37 | 2 | 193 | 102 | 8,606
Impairments 1 Jan | -136 | 0 | 0 | 0 | -1 | 0 | -138
Increases | -276 | 0 | 0 | 0 | 0 | -5 | -281
Impairments 31 Dec | -412 | 0 | 0 | 0 | -1 | -5 | -419
Book value on 31 December 2022 | 6,432 | 1,428 | 37 | 2 | 191 | 97 | 8,187
Book value on 31 December 2021 | 6,378 | 1,578 | 37 | 2 | 191 | 48 | 8,234

Note 15 Inventories

| As at 31 December
EUR million | 2022 | 2021
Materials and supplies | 288 | 183
Work in progress | 11 | 14
Finished goods | 247 | 158
Other inventories | 0 | 0
Prepayments | 27 | 31
Total | 574 | 387

Note 16 Short-term receivables

| As at 31 December
EUR million | 2022 | 2021
Short-term loan receivables |  |
Receivables from Group companies |  |
Loan receivables | 536 | 764
Interest receivables | 50 | 42
Total | 585 | 806
Receivables from others |  |
Loan receivables | 0 | 49
Commodity derivative receivables | 18 | 23
Other receivables | 29 | 5
Interest receivables | 23 | 4
Total | 69 | 82
Total current interest-bearing receivables | 654 | 887
Current non-interest-bearing receivables |  |
Receivables from Group companies |  |
Trade receivables | 150 | 112
Other receivables | 183 | 60
Total | 333 | 172
Receivables from others |  |
Trade receivables | 219 | 200
Deferred tax assets | 0 | 2
Other receivables | 41 | 23
Accrued income | 30 | 29
Total | 290 | 254
Stora Enso may enter into factoring agreements to sell trade receivables in order to accelerate cash conversion. Nominally, such agreements led to the nominal derecognition of EUR 30,0 million (EUR 34,3 million in 2021) by the end of the financial period. The continuing involvement of Stora Enso in the sold receivables was estimated as being insignificant due to the non-recourse nature of the factoring arrangements involved.

| As at 31 December
EUR million | 2022 | 2021
Total current non-interest-bearing receivables | 624 | 427
Total current receivables | 1,278 | 1,314
Significant accruals |  |
Other accruals from Group | -1 | 0
Tax-equivalent receivables | 3 | 3
Advances paid | 9 | 7
Other accruals | 19 | 19
Total | 30 | 29

91
Note 17 Financial securities

| As at 31 December
EUR million | 2022 | 2021
From Group companies | 620 | 72
From others | 510 | 535
Total | 1,130 | 607

Note 18 Shareholders' equity

| As at 31 December
EUR million | 2022 | 2021
Restricted shareholders' equity |  |
Share capital 1 Jan | 1,342 | 1,342
Share capital 31 Dec | 1,342 | 1,342
Share premium fund 1 Jan | 3,639 | 3,639
Share premium fund 31 Dec | 3,639 | 3,639
Fair value reserve 1 Jan | -6 | -6
Increase (-) / Decrease (+) | 32 | 0
Fair value reserve 31 Dec | 25 | -6
Total restricted equity | 5,006 | 4,975
Change in share capital and number of shares are presented in Note 18 to the consolidated financial statements. |  |
Non-restricted shareholders' equity |  |
Invested unrestricted equity reserve 1 Jan | 633 | 633
Invested unrestricted equity reserve 31 Dec | 633 | 633
Retained earnings 1 Jan | 1,356 | 955
Dividend distribution | -434 | -237
Retained earnings 31 Dec | 922 | 719
Profit for the period | 416 | 637
Total non-restricted equity | 1,971 | 1,989
Total shareholders' equity | 6,977 | 6,964
Calculation of distributable equity 31 Dec |  |
Fair value reserve 31 Dec | 0 | -6
Invested unrestricted equity reserve 31 Dec | 633 | 633
Retained earnings 31 Dec | 922 | 719
Profit for the period | 416 | 637
Total | 1,971 | 1,983

Note 19 Accumulated appropriations

| As at 31 December
EUR million | 2022 | 2021
Depreciation difference |  |
Intellectual property rights | -1 | -3
Goodwill | 0 | -1
Other non-current expenditure | 1 | 0
Buildings and structures | 34 | 33
Plant and equipment | 257 | 205
Other tangible assets | -1 | 0
Total | 290 | 234

Note 20 Obligatory provisions

| As at 31 December
EUR million | 2022 | 2021
Restructuring provisions | 3 | 3
Environmental provisions | 20 | 7
Pension provisions | 1 | 1
Total | 24 | 11

Note 21 Deferred tax liabilities and receivables

| As at 31 December
EUR million | 2022 | 2021
Deferred tax liability due to depreciation difference | -41 | -30
Deferred tax receivables and liabilities due to derivatives | -6 | 2
Deferred tax receivable due to provisions | 5 | 3
Deferred tax receivables and liabilities due to other temporary differences | -1 | -1
Total deferred tax receivable | -43 | -27
Deferred tax liabilities and receivables excluding derivatives have not been recognised on the balance sheet.

Note 22 Non-current liabilities

| As at 31 December
EUR million | 2022 | 2021
Non-current liabilities |  |
Bonds | 2,165 | 2,502
Loans from credit institutions | 100 | 7
Other non-current liabilities to group companies | 0 | 4
Total | 2,265 | 2,513
Liabilities with maturities later than five years |  |
Bonds | 1,075 | 1,383
Other non-current liabilities | 5 | 4
Total | 1,080 | 1,387
Specifications of Bond loans are presented in Note 26 Interest-bearing liabilities in consolidated financial statements.

92
Note 23 Current liabilities

| As at 31 December
EUR million | 2022 | 2021
Current interest-bearing liabilities |  |
Liabilities to Group companies |  |
Other loans | 1,966 | 1,677
Commodity derivative liabilities | 18 | 23
Total | 1,984 | 1,700
Liabilities to others |  |
Other loans | 141 | 161
Interest due | 32 | 27
Bonds | 300 | 0
Loans from credit institutions | 250 | 0
Total | 722 | 187
Total current interest-bearing liabilities | 2,706 | 1,888
Current non-interest-bearing liabilities |  |
Liabilities to Group companies |  |
Trade payables | 90 | 83
Other loans | 275 | 73
Commodity derivative liabilities | 6 | 10
Accrued liabilities and deferred income | 0 | 1
Total | 371 | 166
Liabilities to equity accounted investments |  |
Trade payables | 98 | 54
Total | 98 | 54
Liabilities to others |  |
Advances received | 5 | 5
Trade payables | 468 | 375
Other loans | 27 | 17
Accrued liabilities and deferred income | 134 | 95
Total | 635 | 491
Total current non-interest-bearing liabilities | 1,105 | 712
Total current liabilities | 3,811 | 2,599
Substantial accrued liabilities and deferred income |  |
Payroll payments accrued | 66 | 58
Income tax accrued | 28 | 0
Annual discounts | 22 | 21
Other accrued liabilities and deferred income | 18 | 17
Total | 134 | 96

Note 24 Commitments and contingencies

| As at 31 December
EUR million | 2022 | 2021
For Group debt |  |
Guarantees | 794 | 1,044
For joint venture debt |  |
Guarantees | 32 | 82
On behalf of Associated companies |  |
Guarantees | 5 | 0
On behalf of others |  |
Other commitments | 36 | 36
Other commitments, own |  |
Leasing commitments, in next 12 months | 8 | 6
Leasing commitments, after next 12 months | 14 | 10
Lease commitments | 5 | 5
Other commitments | 12 | 13
Total | 906 | 1,197
Guarantees | 831 | 1,126
Leasing commitments | 22 | 16
Lease commitments | 5 | 5
Other commitments | 47 | 48
Total | 906 | 1,197

Contingent liabilities
Stora Enso Oyj has implemented significant restructuring measures in recent years. These
measures have included divestments of business operations and production units, as well as mill
closures. These transactions include a risk of possible environmental or other obligations, the
existence of which would be confirmed only by the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control of the Group. A provision has been
recognised for obligations for which the related amount can be estimated reliably and the
occurrence of which is considered likely.
Stora Enso Oyj has been granted various investment subsidies and has given certain
investment commitments in Finland. If committed planning conditions are not met, local officials
may pursue administrative measures to reclaim some of the formerly granted investment
subsidies or to impose penalties on Stora Enso Oyj and the outcome of such a process could
result in a negative financial impact on Stora Enso Oyj.
Stora Enso Oyj is party to legal proceedings that arise in the ordinary course of business and
primarily involve claims arising out of commercial law. The company management does not
believe that such processes as a whole, before any insurance compensation, would have
significant impacts on the company’s financial position or profit from operations. Some of the
most significant legal proceedings are described in Note 29 to the consolidated financial
statements.
93
Note 25 Financial instruments
Valuation of derivatives
The fair value is defined as the amount at which a derivative instrument could be exchanged in
an orderly transaction between market participants at the measurement date. The fair values of
such instruments are determined on the following basis:
•Foreign exchange forward contract fair values are calculated using forward exchange rates
on the reporting date.
•Foreign exchange option contract fair values are calculated using reporting date market rates
together with common option pricing models.
•Commodity contract fair values are computed with reference to quoted market prices on
futures exchanges or other reliable market sources.
•Interest rate swaps fair values are calculated using a discounted cash flow method.
Fair value hierarchy
Stora Enso uses the following hierarchy for determining and disclosing the fair value of financial
instruments by valuation technique:
•Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities;
•Level 2: other techniques, for which all inputs that have a significant effect on the recorded
fair value are observable, either directly or indirectly;
•Level 3: techniques which use inputs that have a significant effect on the recorded fair values
that are not based on observable market data.
The parent company's derivatives are classified as Level 2 in the fair value hierarchy.
Nominal and fair values of derivative instruments

| As at 31 December 2022
EUR million | Nominal values | Positive fair values | Negative fair values | Fair values, Net
Cash flow hedges entered on behalf of the parent company and its subsidiaries, for which hedge accounting is applied in target companies |  |  |  |
Foreign exchange forwards | 1,523 | 29 | -26 | 3
Foreign exchange options | 3,222 | 28 | -28 | 0
Commodity contracts | 10 | 18 | -18 | 0
Interest rate swaps | 442 | 28 | 0 | 28
Non-hedge accounted derivatives |  |  |  |
Foreign exchange forwards | 1,493 | 8 | -8 | 0
Commodity contracts | 11 | 9 | 0 | 9
Total | 6,702 | 120 | -79 | 41
of which against subsidiaries | 2,571 | 29 | -45 | -15
of which against external parties | 4,131 | 91 | -34 | 57

| As at 31 December 2021
EUR million | Nominal values | Positive fair values | Negative fair values | Fair values, Net
Cash flow hedges entered on behalf of the parent company and its subsidiaries, for which hedge accounting is applied in target companies |  |  |  |
Currency forwards | 2,007 | 20 | -22 | -2
Currency options | 1,811 | 13 | -15 | -1
Commodity contracts | 33 | 27 | -27 | 0
Interest rate swaps | 467 | 1 | -7 | -6
Non-hedge accounted derivatives |  |  |  |
Currency forwards | 702 | 2 | -2 | 0
Total | 5,020 | 63 | -72 | -9
of which against subsidiaries | 2,091 | 29 | -33 | -4
of which against external parties | 2,930 | 34 | -40 | -5

Fair value reserve
The net amount of the parent company's unrealised cash flow hedge gains in the fair value
reserve was EUR 25.3 (6.4) million, which was related to currency and interest rate derivatives.
Currency and interest rate derivatives also include a gain of EUR 0.1 (a loss 0.1) million related
to the time value of options. These unrealised gains are recognised in the income statement
upon the maturity of the hedging contracts. The longest hedging contract will mature in 2027.
However, the majority of the contracts are expected to mature during 2023. The ineffective
portions of hedges are recognised as adjustments to financial items, revenue or materials and
services according to the hedged item. During 2022 and 2021, there were no material
ineffectiveness related to hedges recognised in the income statement. Derivatives used in
currency cash flow hedges are mainly forward contracts and options. Swaps are mainly used in
commodity hedges and interest rate cash flow hedges.
Hedge gains and losses in operating profit

| Year ended 31 December
EUR million | 2022 | 2021
Cash flow hedge accounted derivatives |  |
Currency hedges | -20 | -2
Commodity hedges | 0 | 3
Total | -20 | 1
As adjustments to sales | -20 | -2
As adjustments to materials and services | 0 | 3
Items realised from the fair value reserve that are recognised in the income statement | -20 | 1
Net losses from cash flow hedges | -20 | 1
Non-hedge accounted derivatives |  |
Currency derivatives | -5 | -4
Net gains on non-hedge accounted derivatives | -5 | -4
Net hedge gains/losses in operating profit | -25 | -3

94
Hedge gains and losses in financial items

| Year ended 31 December
EUR million | 2022 | 2021
Non-hedge accounted derivatives |  |
Currency derivatives | -1 | -11
Net gains/losses in financial items | -1 | -11

Sensitivity of currency derivatives to strengthening of EUR

| 31 December 2022
EUR million | SEK | USD | GBP
Currency change against EUR | -5.0% | -5.0% | -5.0%
Nominals of currency derivatives hedging next 12 months cash flow in EUR | 0 | -184 | -16
Estimated effect on fair value reserve in EUR (net of taxes) | 0 | 9 | 1

Sensitivity of commodity derivatives to price risk
There were no outstanding commodity derivatives related to parent company's cash flows at the
end of reporting period. Commodity derivative contracts are related to a closed position of Stora
Enso Oyj's subsidiary. The market value is settled during year 2023.
More detailed information about financial instruments are presented in Note 24 Financial risk
management, Note 25 Fair values and Note 27 Derivatives to the consolidated financial
statements.
Note 26 Related party transactions

| 31 December
EUR million | 2022 | 2021
Related party transactions with associated companies and joint ventures: |  |
Purchase of materials and supplies during the year | 63 | 88
Interest income on non-current loan receivables | 0 | 1
Non-current loan receivables at year end | 2 | 2
Trade payables at year end | 92 | 54
The Group's principles for related party transactions are presented in Note 31 to the consolidated financial statements.

95
Signatures for the financial statements
There have been no material changes in the Parent Company’s financial position since 31
December 2022. The liquidity of the Parent Company remains good and the proposed dividend
does not risk the solvency of the Company.
30 January 2023

Antti Mäkinen |  | Håkan Buskhe
Chair |  | Vice Chair
Elisabeth Fleuriot |  | Hock Goh
Helena Hedblom |  | Kari Jordan
Christiane Kuehne |  | Richard Nilsson
Hans Sohlström |  |
Annica Bresky |  |
President and CEO |  |

96
Auditor’s Report (Translation of the Finnish Original)
To the Annual General Meeting of Stora Enso Oyj
Report on the Audit of the Financial Statements

Opinion

In our opinion
•the consolidated financial statements give a true and fair view of the group’s financial position and financial performance and
cash flows in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU
•the financial statements give a true and fair view of the parent company’s financial performance and financial position in
accordance with the laws and regulations governing the preparation of the financial statements in Finland and comply with
statutory requirements.
Our opinion is consistent with the additional report to the Audit Committee.
What we have audited
We have audited the financial statements of Stora Enso Oyj (business identity code 1039050-8) for the year ended 31 December
2022. The financial statements comprise:
•the consolidated statement of financial position, income statement, statement of comprehensive income, statement of changes in
equity, cash flow statement and notes, including a summary of accounting principles
•the parent company’s statement of financial position, income statement, cash flow statement and notes.

Basis for Opinion

We conducted our audit in accordance with good auditing practice in Finland. Our responsibilities under good auditing practice are
further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the parent company and of the group companies in accordance with the ethical requirements that are
applicable in Finland and are relevant to our audit, and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
To the best of our knowledge and belief, the non-audit services that we have provided to the parent company and to the group
companies are in accordance with the applicable law and regulations in Finland and we have not provided non-audit services that are
prohibited under Article 5(1) of Regulation (EU) No 537/2014. The non-audit services that we have provided are disclosed in note 5 to
the Financial Statements.

Our Audit Approach

Overview

| •We have applied an overall group materiality of EUR 60 million.
•We performed audit procedures at 26 reporting components in 10 countries that are considered significant based on our overall risk assessment and materiality.
•Valuation of forest assets •Provisions and contingent liabilities

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements.
In particular, we considered where management made subjective judgements; for example, in respect of significant accounting
estimates that involved making assumptions and considering future events that are inherently uncertain.
Materiality
The scope of our audit was influenced by our application of materiality. An audit is designed to obtain reasonable assurance whether
the financial statements are free from material misstatement. Misstatements may arise due to fraud or error. They are considered
material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of the financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall group
materiality for the consolidated financial statements as set out in the table below. These, together with qualitative considerations,
helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of
misstatements on the financial statements as a whole.

Overall group materiality | EUR 60 million
How we determined it | Based on operating profit and total assets
Rationale for the materiality benchmark applied | We chose operating profit and total assets as the benchmarks because, in our view, they are relevant benchmarks against which the performance of the group is commonly measured by users of the financial statements.

How we tailored our group audit scope
We tailored the scope of our audit, taking into account the structure of the group, the accounting processes and controls, and the
industry in which the group operates.
The Group operates in a significant number of legal entities or “reporting components” globally. We determined the nature, timing and
extent of audit work that needed to be performed at reporting components by us, as the group engagement team, or component
auditors operating under our instruction. Where the work was performed by component auditors, we issued specific instructions to
those auditors which included our risk analysis, materiality and global audit approach. We performed audit procedures at 26 reporting
components in 10 countries that are considered significant based on our overall risk assessment and materiality. We have considered
that the remaining reporting components do not present a reasonable risk of material misstatement for consolidated financial
statements and thus our procedures related to these reporting components have been limited to targeted audit procedures over
significant balances and to analytical procedures performed at group level.
By performing the procedures above at reporting components, combined with additional procedures at the group level, we have
obtained sufficient and appropriate evidence regarding the financial information of the group as a whole to provide a basis for our
opinion on the consolidated financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial
statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole,
and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters
consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

Key audit matter in the audit of the group | How our audit addressed the key audit matter
Valuation of forest assets Refer to Note 1, Note 2 and Note 12 in the consolidated financial statements for the related disclosures. Forest assets comprise of forest land and biological assets excluding leased forest land assets. As of December 31, 2022 the fair value of the Group’s forest assets owned through subsidiaries, joint operations and associated companies was EUR 8 117 million. The fair value of EUR 5 653 million was related to biological assets and EUR 2 464 million was related to forest land. Forest assets in Sweden and Finland are recognised at fair value and valued by using a market approach method on the basis of the forest market transactions in the areas where the Stora Enso's forests are located. Market prices between areas vary significantly and judgement is applied to define relevant areas for market transactions used in the valuation. In addition, market transaction data is adjusted to consider characteristics and nature of the Group’s forest assets and to exclude certain non- forest assets and transactions considered as outliers compared to other transactions. Biological asset valuation is computed based on a discounted cash flow (DCF) method in accordance with IAS 41 Agriculture. For forest land the revaluation method is applied as defined in IAS 16 Property, plant and equipment. Forest land is revalued using a DCF method based on estimated future net cash flow streams related to trees to-be-planted in the future as well as other income, such as hunting rights, wind power leases and soil material sales. Total value of biological assets and forest land agrees to the market transaction based value of forest assets as a discount rate implied by the market transactions is used in the DCF method to value these assets. The value of biological assets outside Sweden and Finland is determined using discounted cash flows based on sustainable forest management plans taking into account the growth potential of one cycle. The one cycle varies depending on the geographic location and species. Determining the discounted cash flows require estimates of growth, harvest, sales price and costs. The other European forest lands are revalued by using a DCF method based on its estimated future net cash flow streams related to trees to-be-planted in the future as well as other non- forest related income. The forest land for the plantations is accounted at cost. Due to the level of judgment involved in the valuation of forest assets as well as the significance of forest assets to the Group's financial position, this is considered to be a key audit matter. | We obtained an understanding of management’s forest assets valuation process, evaluated the design and tested the operating effectiveness of internal controls related to directly and indirectly owned forest assets. Our audit procedures over valuation of directly owned forest asset included: •Evaluation of the methodology adopted by management for the valuation; •Testing the mathematical accuracy of the model used for valuation; •Assessment of the discount rates applied in the valuation; •Assessment of the other key valuation assumptions; and •Validation of key inputs and data used in the valuation model including sales price assumptions, growth assumptions and cost assumptions. In addition, specific to the market transaction based valuation our audit procedures included: •Assessment of the definition of relevant areas for market transactions used in the valuation; •Assessment of the adjustments made to the market transaction data; and •Validation of key inputs and data used in the valuation model including market transaction data and volume of standing trees. We involved valuation specialists in the audit work over valuation of directly owned forest assets. Related to indirectly owned forest assets we have communicated with the auditors of the three largest associates and joint operations. As part of the communication, among other things, we have evaluated the key audit procedures performed related to valuation of forest assets. Lastly, we assessed the appropriateness of disclosures related to forest assets.

Provisions and contingent liabilities Refer to Note 2, Note 22 and Note 29 in the consolidated financial statements for the related disclosures. As of 31 December 2022, the Group had environmental, restructuring and other provisions totaling EUR 124 million. In addition, the Group has disclosed significant open legal cases and other contingent liabilities in Note 29. The assessment of the existence of the present legal or constructive obligation, the analysis of the probability of the outflow of future economic benefits, and making a reliable estimate, require management’s judgement to ensure appropriate accounting and disclosures. Due to the level of judgement relating to recognition, valuation and presentation of provisions and contingent liabilities, this is considered to be a key audit matter. | We obtained an understanding of management’s process to identify new obligations and changes in existing obligations. We analysed significant changes in material provisions from prior periods and obtained a detailed understanding of these changes and assumptions applied. Our audit procedures related to material provisions recognized included: •Assessment of the recognition criteria for the liability; •Evaluation of the methodology adopted by management for the measurement of the liability; •Testing of the mathematical accuracy of the measurement calculation; •Assessment of the discount rates applied in the measurement; and •Assessment of the other key measurement assumptions and inputs. We obtained legal letters on the main outstanding legal cases. We reviewed minutes of the board meetings including sub committees. We assessed the appropriateness of the presentation of the most significant contingent liabilities in the consolidated financial statements.
We have no key audit matters to report with respect to our audit of the parent company financial statements.
There are no significant risks of material misstatement referred to in Article 10(2c) of Regulation (EU) No 537/2014 with respect to the consolidated financial statements or the parent company financial statements.

Responsibilities of the Board of Directors and the Managing Director for the Financial Statements

The Board of Directors and the Managing Director are responsible for the preparation of consolidated financial statements that give a
true and fair view in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, and of financial
statements that give a true and fair view in accordance with the laws and regulations governing the preparation of financial
statements in Finland and comply with statutory requirements. The Board of Directors and the Managing Director are also responsible
for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors and the Managing Director are responsible for assessing the parent
company’s and the group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and
using the going concern basis of accounting. The financial statements are prepared using the going concern basis of accounting
unless there is an intention to liquidate the parent company or the group or to cease operations, or there is no realistic alternative but
to do so.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that an audit conducted in accordance with good auditing practice will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.
As part of an audit in accordance with good auditing practice, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
•Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and
perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis
for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
•Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the parent company’s or the group’s
internal control.
•Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management.
•Conclude on the appropriateness of the Board of Directors’ and the Managing Director’s use of the going concern basis of
accounting and based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that

may cast significant doubt on the parent company’s or the group’s ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may cause the parent company or the group
to cease to continue as a going concern.
•Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the
financial statements represent the underlying transactions and events so that the financial statements give a true and fair view.
•Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group
to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance
of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in
the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our
auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
Other Reporting Requirements

Appointment

We were first appointed as auditors by the annual general meeting on 28 March 2018.

Other Information

The Board of Directors and the Managing Director are responsible for the other information. The other information comprises the
report of the Board of Directors.
Our opinion on the financial statements does not cover the other information.
In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in
the audit, or otherwise appears to be materially misstated. With respect to the report of the Board of Directors, our responsibility also
includes considering whether the report of the Board of Directors has been prepared in accordance with the applicable laws and
regulations.
In our opinion
•the information in the report of the Board of Directors is consistent with the information in the financial statements
•the report of the Board of Directors has been prepared in accordance with the applicable laws and regulations.
If, based on the work we have performed, we conclude that there is a material misstatement of the report of the Board of Directors,
we are required to report that fact. We have nothing to report in this regard.

Other Statements

We support the proposal that the financial statements are adopted. The proposal by the Board of Directors regarding the distribution
of profits is in compliance with the Limited Liability Companies Act. We support that the Board of Directors and the Managing Director
of the parent company should be discharged from liability for the financial period audited by us.
Helsinki 13 February 2023
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)