Consti Oyj — Governance Information 2021

Mar 16, 2021

CONSTI

Consti Plc's Corporate Governance Statement 2020

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REVIEW OF CONSTI PLC'S CORPORATE GOVERNANCE 2020

Consti Plc (Consti) is registered in Finland and it is a publicly listed company at Nasdaq Helsinki Ltd Stock Exchange. Consti's governance and management are based on the Finnish Limited Liability Companies Act and Securities Markets Act, the company's Articles of Association and the rules and guidelines of NASDAQ Helsinki Oy. Consti complies with the Finnish Corporate Governance Code (www.cgfinland.fi).

This Corporate Governance review has been given as a separate entity alongside of the Financial Statements, Report of the Board of Directors and Remuneration Report. The review is available online on the Group's website www.consti.fi > Investors > Corporate Governance.

Consti Plc's Board has assessed the review in its meeting 4 February 2021, and the company's auditor has confirmed that the reviews general description on internal control and risk management is in line with the financial statement.

1 BOARD OF DIRECTORS

The Board's responsibilities

The Board of Directors confirms Consti's strategy and monitors its implementation. In accordance to the Companies Act and Consti's Articles of Association the Board of Directors attends to Consti's administration and organization of its operations and represents the company. Consti's Board of Directors has established written Rules of Procedure, in which its central responsibilities and principles of operation are defined.

Consti's Board of Directors has three to nine members. The Board elects a Chairman and a Deputy Chairman from among its members. The Board assesses the independence of its members. The Nomination and Compensation Committee, annually set by the Board of Directors, makes a proposal of the composition of the Board of Directors to the GM.

The Board of Directors

• defines the Company's dividend policy
• decides on donations within the framework of the Finnish Companies Act
• defines the operating principles for the risk management system and internal control
• considers and approves interim reports, the report of the Board of Directors and the annual financial statements
• confirms its own Rules of Procedure
• confirms the Company's operating principles and monitors how they are carried out
• approves the Company's strategy and monitors how it is carried out
• approves annually a business plan and budget based on the strategy and monitors how they are carried out
• sets personal goals for the CEO annually and assesses how they are achieved as well as approves the targets for the members of the Management Team and assesses how those are achieved
• confirms the Group's organizational structure
• appoints and discharges from their duties the CEO and the members of the Management Team and decides on their terms of employment and incentive schemes
• prepares draft resolutions as necessary for the General Meeting of Shareholders concerning remuneration schemes for management and personnel
• monitors succession issues of the management
• considers other matters that the Chairman of the Board or CEO has submitted on the agenda. Members of the Board are also entitled to bring matters before the Board by informing the Chairman of this.

Composition of the Board

Consti Plc's Board of Directors is chosen by the Annual General Meeting (AGM) for a set time period lasting until the next AGM. The Nomination and Compensation Committee makes a proposal of the composition of

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the Board of Directors to the GM. The Nomination and Compensation committee also deals with the company's diversity principles.

Requirements set by operations as well as the company's development stage are taken into consideration when electing the Board of Directors. As stated in the Corporate Governance Code, Board members must have required competence for the position and sufficient time to take care of Board responsibilities. The number of Board Members and the Board's composition must enable efficiently taking care of the Board's responsibilities. As stated in the Code, the Board must have both genders represented.

The diversity of the Board is based on Consti's business strategy and future needs. Diversity criteria include the Members' experience in the company's strategic business areas, the cultures that the company operates in, as well as education, age and gender.

In addition to the corporate governance code, the Nomination and Compensation Committee must take into consideration the company's diversity criteria when identifying and suggesting new members to the Board. The diversity criteria are set to ensure that the Board's competence, background and personal abilities in general meet the company's current and future operational needs.

Board Members 31.12.2020

Consti Plc's Board of Directors on 31 December 2020 comprised of Tapio Hakakari (Chairman), Erkki Norvio, Petri Rignell, Pekka Salokangas, Anne Westersund and Johan Westermarck. All Board members were elected in the Annual General Meeting on 6 April 2020.

Board of Directors 31 December 2020:

Tapio Hakakari

Chairman

Member of the Nomination and Compensation Committee

Master of Laws, born 1953

Board Member since 2015

Finnish citizen

Independent of the company and of significant shareholders

Key work experience

Webstor Oy, CEO

Cargotec PLC, interim President and CEO 2012-2013

Kone PLC, Director and Secretary to the Board 1998-2006

KCI Konecranes, 1994-1998

Kone PLC, 1983-1994

Key positions of trust

Rakennuttajatoimisto HTJ Oy, Chairman of the Board since 2016

Svenska Handelsbanken AB (publ) Finland, Board Member since 2016 and Chairman of the Board since 2019

Cargotec PLC, Board Member since 2005 and Deputy Chairman of the Board since 2009

Consti Plc's shares partly through his holding company 85,400 (31 December 2020)

Erkki Norvio

Board Member

Member of the Nomination and Compensation Committee

MSc. (tech.), M.Sc. (econ.), born 1945

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Board Member since 2008 (Chairman 2008–2011)
Finnish citizen
Independent of the company and of significant shareholders

Key work experience
Ramirent Plc, Deputy CEO 1984–1985 and CEO 1986–2005
Partek Oy, 1972–1984

Key positions of trust
Renta Group Oy, Board Member since 2015
Norvier Oy, Chairman of the Board since 2007
RGE Holding Oy, Board Member since 2014
Intera Equity Partners Oy, Board Member since 2007

Consti Plc’s shares through his holding company 106,463 (31 December 2020)

Petri Rignell

Board Member
Member of the Nomination and Compensation Committee

MSc. (tech.), born 1962
Board Member since 2008
Finnish citizen
Independent of the company and of significant shareholders

Key work experience
Kreate Oy, CEO 2016–2017
IVG Polar Oy, CEO 2010–2013
CapMan Real Estate, Industrial Advisor 2007–2010
Projektikonsultit Oy, CEO 1994–2007
Polar Yhtiöt, Foreman 1989–1994
Lemminkäinen Oy, Project Engineer 1985–1989

Key positions of trust
Sitowise Oy, Member of the Board since 2019
Kreate Oy, Chairman of the Board since 2017
PriRock Oy, Chairman of the Board since 2007

Consti Plc’s shares through his holding company 25,100 (31 December 2020)

Pekka Salokangas

Board Member
Member of the Nomination and Compensation Committee

M.Sc. (econ.) born 1961
Board Member since 2012
Finnish citizen
Independent of the company and of significant shareholders

Key work experience
Mantec International, Management Consultant since 2018
Relacom Oy, CEO 2009–2017
Wiltrain Consulting Oy and PlanStone Oy, Management Consultant 2008–2009

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ISS Palvelut Oy, Business Unit Director 1998–2008
Talotek Oy, CEO 1996–1998
Onninen Oy Wholesale International, Marketing Director 1993–1996
Huber Oy, Development Director 1989–1993

Consti Plc’s shares 22,000 (31 December 2020)

Anne Westersund

Board Member

M.A. studies, translator degree, born 1964
Board member since 2019
Finnish citizen
Independent of the company and significant shareholders

Key work experience
Rokmind Oy, Partner since 2018
WesAnne Oy Ab, CEO since 2017
Cargotec Oyj, SVP Head of Customer Value Programme 2015-2017, SVP Communications and Public Affairs 2013-2015, VP Communications and Marketing 2010-2013
Vattenfall AB, VP Communication Nordic 2005-2010
Vattenfall Oy, Customer Service Director 2002-2005
Silja Line, Marketing Manager 2000-2002

Key positions of trust
Rokmind Oy, Chairman of the Board since 2019
Oy Hedengren Ab, Board Member since 2018

Consti Plc’s shares through her holding company 2,000 (31 December 2020)

Johan Westermarck

Board Member

Lic.Sc. (Econ.), M.Sc (Tech.), born 1965
Board Member since 4/2020
Finnish citizen
Independent of the company and significant shareholders

Key work experience
Citec Group Oy Ab, CEO since 2017
Maintpartner Group Oy, CEO, 2012-2017
Maintpartner Oy, CEO, 2010-2012
Maintpartner Ab, CEO, 2009-2010
Eltel Group Oy, VP, Business Development, 2007-2008
Eltel Networks GmbH, CEO, 2006-2007
Eltel Group Oy, VP, Business Development, 2004-2006
Elcoteq Oyj, VP, Sales and Marketing, 2001-2004
Ahlstrom Machinery Oy: Regional Director, Service Business 1997-2001, Manager, Marketing Development 1995-1997, Project Engineer 1992-1995

Does not own Consti Plc’s shares (31 December 2020)

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The Board of Directors held 14 meetings during 2020, the average attending rate of Board Members was 100%. The attendance rate per Member was: Tapio Hakakari 100%, Erkki Norvio 100%, Petri Rignell 100%, Pekka Salokangas 100%, Anne Westersund 100%, Antti Korkeela 100% and Johan Westermarck 100%.

Board of Director's Committees

The Board has a Nomination and Compensation Committee. The Board annually nominates at least three Committee Members and appoints one of them as Chairman of the Committee, and confirms the Committee's written charters. The Committee meets when necessary, however at a minimum three times a year.

The Committee has no independent decision-making power; it prepares matters to be presented to and decided by the Board. The Committee directly presents the proposal for composition and compensation for the Board of Directors to the Annual General Meeting; prepares a proposal for the CEO and the terms of his/her employment and when necessary also prepares proposals on the appointment and remuneration of other executives prior to the Board of Directors' meeting. The Committee prepares the Group's remuneration principles, short and long-term compensation schemes and monitors their efficiency and realisation. The Committee also prepares the company's diversity policy.

In 2020, the Committee consisted of Petri Rignell (Chairman), Pekka Salokangas, Erkki Norvio and Tapio Hakakari and it had three meetings. All Members attended the meetings.

The Board has stipulated that the Group's scope of operations does not necessitate the creation of a separate Audit Committee, and the Board will take care of its responsibilities. In this capacity, the Board meets the external auditor at least once a year without the members of the management employed by the Company. In the capacity of the Audit Committee, the Board's responsibilities include reviewing the Company's financial statements, half-year financial report and interim reports, monitoring the internal control system, and seeing to internal and external audits.

2 CEO

The Board appoints Consti's CEO and determines the related terms of employment. The employment terms of the CEO are defined in a written employment contract. The CEO is responsible for ensuring that the targets, plans, guidelines and goals set by the Board are carried out within the Company. According to the Finnish Companies Act, the CEO ensures that the accounting practices of the company comply with the law and that financial matters are handled in a reliable manner. The Board assesses the CEO's work and monitors the CEO's development in achieving set targets.

In 2020, Consti's CEO was Esa Korkeela. Esa Korkeela was born in 1972 and has a Master of Science (Econ.) and MBA degrees. He has worked for the company since 2009 as the Group's CFO and as interim CEO during 9-12/2017. At the end of the fiscal period, according to the register maintained by Euroclear Oy, the CEO owned 434,133 Consti Plc shares, which amounts to 5.52 percent of the company's shares and votes.

3 MANAGEMENT TEAM

Supporting the CEO in his/her duties, the Management Team is responsible for business development and the Company's operational activities in accordance with targets set by the Board of Directors and the CEO. The Management Team also defines operative principles and procedures in accordance with guidelines set by the Board. The Management Team convenes every month and whenever necessary and concentrates on the strategic issues of the Group and the business areas. On the agenda there are regular reports and questions concerning the development of the financials, governance, corporate responsibility and development projects. The CEO acts as Chairman of the Management Team.

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Management Team Members 31 December 2020:

Esa Korkeela
CEO
M.Sc. (econ.), MBA, born 1972

Key work experience
- Consti Plc, CEO since 2017
- Consti Group Plc, Interim CEO 9–12/2017
- Consti Group Plc, CFO 2009–2017
- JRH Rakennushuolto Oy, CFO 1995–2009

Key positions of trust
- Tiirinkallio Oy, Chairman of the Board since 2018

Consti Plc’s shares 434,133 (31 December 2020)

Joni Sorsanen
CFO
M.Sc. (Econ.), born 1983

Key work experience
- Consti Plc, CFO since 2018
- Caverion Corporation, Head of Group Project Control 2017–2018
- Consti Group Plc, Head of Investor Relations & Group Controller 2016–2017
- Cramo Corporation, various group finance and development tasks, including Business Controller 2009–2016
- Ernst & Young Oy, Consultant 2007–2008

Consti Plc’s shares 12,000 (31 December 2020)

Risto Kivi
Business Area Director Housing Companies and Public Sector
Master Builder, born 1971

Key work experience
- Consti, Business Area Director Housing Companies and Public Sector since 2019
- Consti Julkisivut Oy, CEO 2011–2019
- Raitayhtiot Oy, CEO 2009–2011
- Raitamiespalvelu Oy, CEO 2008–2009
- Raitarakennus Oy, CEO 2007–2009
- Raitasaumaus Oy, CEO 1998–2007
- Rkm Kivi ja Kalevo Oy, entrepreneur 1993–1998

Key positions of trust
- Midpointed Oy, Member of the Board since 2012

Consti Plc’s shares 379,758 (31 December 2020)

Jukka Mäkinen
Business Area Director Corporations
M.Sc. (tech.), born 1960

Key work experience
- Consti, Business Area Director Corporations since 2019
- Consti Korjausurakointi Oy, CEO 2013–2019

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Devecon Projektinjohtopalvelu Oy, CEO 2013
Hartela Oy, manager 2007 – 2011 and production manager 2011 – 2013
ISS Proko Oy, Regional Manager 1999–2007
Projektikonsultit Oy, Project Manager 1997–1999
YIT-Yhtymä Oy, Chief of the Technical office 1995–1997 and worksite/project engineer 1989–1995
Helsinki University of Technology, Lecturer 1998–2014

Key positions of trust
Talonrakennusteollisuus Ry, Board Member since 2015
Talonrakennusteollisuus Uudenmaan piiri Ry, Board Member since 2015

Consti Plc's shares 13,339 (31 December 2020)

Pekka Pöykkö

Business Area Director Building Technology
Engineer, born 1967

Key work experience
Consti, Business Area Director Building Technology since 2019
Consti Talotekniikka Oy, CEO since 2016
Saipu Oy, CEO 2014–2015
Caverion Suomi Oy, Business Unit Director 2010–2014
YIT Kiinteistötekniikka Oy, Business Unit Director 2004–2010
YIT Rapido Kiinteistöpalvelut Oy, CEO 1999–2004
YIT Service Oy, Regional Manager 1994–1999
Norstep Oy, Development Engineer 1993–1994

Key positions of trust
Talotekniikkaliitto ry, Member of the Board since 2015
LVI-Tekniset Urakoitsijat LVI-TU ry, Board and Management Team Member 2015–2020

Consti Plc's shares 1,056 (31 December 2020)

Markku Kalevo

Bid and Sales Director Housing Companies
Construction technician, born 1971

Key work experience
Consti, Bid and Sales Director Housing Companies since 2019
Consti Julkisivut Oy, Bid and Sales Director 2011–2019
Raitayhtiöt Oy, Deputy CEO 2009–2010
Raitasaneeraus Oy, CEO 1998–2009
Rkm Kivi ja Kalevo Oy, entrepreneur 1993–1998

Consti Plc's shares 299,128 (31 December 2020)

Pirkka Lähteinen

Regional Director Corporations
B.Eng., born 1977

Key work experience
Consti, Regional Director Corporations since 2019
Consti Korjausurakointi Oy, Regional Director 2011–2019
Jollaksen Rakennushuolto Oy, CEO 2009–2011 and Project Manager 2000–2009

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Key positions of trust
eGate Smart Building Innovation Oy, Board Member since 2018
Kaskiniemen Sora Oy, Board Member since 1992

Consti Plc's shares 13,233 (31 December 2020)

Turo Turja

HR Director
M.Sc. (econ.), M.Sc. (tech.), born 1967

Key work experience
Consti Plc, HR Director since 2018
SSAB Europe Oy, HR Director 2015–2017
Rautaruukki Oyj, HR Director 2008–2015
Maan Auto Oy, HR Manager 2006–2008
Steveco Oy, HR Manager 2004–2006
Tekniikan Akateemisten Liitto TEK ry, Adviser 1998–2004

Does not own Consti Plc's shares (31 December 2020)

Heikki Untamala

Chief Legal Officer
LL.M with court training, born 1969

Key work experience
Consti Plc, Chief Legal Officer since 2019
YIT Plc, Head of Legal, Business Premises and Partnership Properties 2018–2019
Lemminkäinen: Director, contracts and legal services, Lemminkäinen Talo Ltd 2013–2018, corporate counsel, Lemminkäinen Plc 2010–2013
Krogerus Attorneys, Attorney at Law 2005–2009
Heikki Untamala Attorneys, Attorney at Law, partner 2000–2005

Does not own Consti Plc's shares (31 December 2020)

4 EXTERNAL AUDIT

The statutory external audit for the financial period includes auditing of accounting records, financial statements and administration. The Annual General Meeting on 6 April 2020 chose Ernst & Young as auditor with APA Toni Halonen as principal auditor. In 2020, audit costs amounted to EUR 216 thousand. In addition, the auditor received compensation for other services amounting to EUR 7 thousand.

Ernst & Young Oy has acted as Consti's auditor since 2008. APA Toni Halonen has acted as principal auditor since 2020.

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5 INTERNAL CONTROL OF THE FINANCIAL REPORTING PROCESS

Consti compiles its financial reporting in accordance with the International Financial Reporting Standards (IFRS), the Securities Markets Act, the Finnish Accounting Act and the Finnish Accounting Board's guidelines and statements, while complying with the standards of the Financial Supervisory Authority (FIN-FSA) and the rules of NASDAQ Helsinki Ltd. The internal control and risk management principles, guidelines, practices and responsibilities pertaining to the company's financial reporting process, have been designed to ensure that the financial reports disclosed by Consti are reliable and meet the requirements of the law, regulations and company principles.

Instructions regarding the publication of financial information and external communications are included in Consti's disclosure policy approved by the Board of Directors. Its main principles are available on the company website at (www.consti.fi > Investors > Corporate Governance). Investor Relations together with Corporate Communications are responsible for ensuring the accuracy of and compliance with the policy.

Risk management

The central principle of Consti's risk management is continuous, systematic and pre-emptive action to identify risks, define the level of risk the company accepts, evaluate and handle risks and, in the event of risk realisation, see to their effective management and administration so that the company will meet its strategic and financial goals. Risk management is a part of the company's management, monitoring and reporting systems. Risk management includes risk identification, evaluation and risk contingency planning.

Consti's strategic and operative goals are used as a basis for identifying risks. Risk analysis and evaluations are conducted as self-assessments. The probability of a risk materialising and the impact this would have is evaluated on a scale of 1-3 as defined in the company's risk principles.

Consti's Board of Directors duty is to confirm the company's risk management principles and evaluate the adequacy and appropriateness of risk management. The CEO is responsible for the company's risk management and its organisation, allocating resources for the work and reviewing the risk management principles. The Group's Management Team is responsible for the actualisation of risk management, operative risk monitoring and risk related actions.

Financial and operational risks, as well as actions taken, are regularly reported to the Management Team. Strategic risks are handled annually together with the strategy. Risk reports are assessed by the Board, the Management Team and in the business areas' own management teams.

Central risks and risk management actions are reported yearly in the annual report and in interim reports.

Internal control

Internal control aims at protecting the company and its business areas' resources from wrongful use; it makes sure all business transaction are authorised in the necessary manner, supports IT system management and ensures the reliability of financial reporting. In Consti, internal control is foremost the responsibility of line management, which is supported by the Group's support functions. A third level of internal control is made up of internal and external audit, which confirm that the first two levels of control function efficiently.

Internal audit

Consti does not have a separate corporate audit function, as internal control responsibilities have been divided inside the corporation between different functions and areas. The Board may use external experts for assessments regarding the control environment or separate operational evaluations. Consti's external auditor's audit plan takes into consideration that the company does not have a separate corporate audit function.

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The CEO creates the foundation for internal control by leading and guiding top management and ensuring that the company's bookkeeping practice follow legislation and financial administration is managed reliably.

The Management Team is responsible for making sure that the organisation's different units have detailed internal control guidelines and procedures. The financial administration staff have an especially important role, as its control actions span all of the company's operational and other units.

The Group's financial administration helps units create appropriate control procedures. It also guides the company's risk management process and reports on its execution to management and monitors the internal control procedures' efficiency and effectiveness in practice.

The business areas' management sees that all of the units and employees that are their responsibility follow the appropriate laws, regulation and internal guidelines.

Financial reporting process

Internal control efficiency regarding financial reporting is overseen by the Board of Directors, and also the CEO and Group and business area Management Teams. Internal control measures, such as reconciliations, logic analyses and comparative analyses are conducted on an organisational level. The purpose of these control measures is to detect, prevent and correct any errors and deviations in financial follow-up.

Consti's financial reporting is based on monthly performance monitoring in a centralised reporting system. Financial reports are handled first at the reporting unit level, then in the Management Teams of the business area and finally in the Group's Management Team. The Board of Directors also receives a monthly report on financial figures. Controllers report any deviations from the plans to the Management Teams, analyse the reasons for such deviations and support the management in decision-making. Monthly reviews also ensure that performance is in line with annual targets and financial forecasts are up to date. Financial administration aims to harmonise the work practises of controllers and ensure guidelines are interpreted consistently throughout the organisation, and also further improve the guidelines.

6 INSIDER MANAGEMENT

Consti complies with EU Regulation on Market Abuse ((EU) 596/2014, "MAR") and 2- and 3-tier regulation supplementing it, the Finnish Securities Markets Act, the insider guidelines of Nasdaq Helsinki Ltd as well as guidance issued by authorities. In addition, the company has internal Insider Guidelines approved by Consti's Board of Directors, which set, to some extent, stricter requirements than the above-mentioned minimum level regulation.

Consti has defined the members of the Board of Directors, the CEO and members of the Group Management Team as persons discharging managerial responsibilities ("persons discharging managerial responsibilities"). Consti publishes the transactions persons discharging managerial responsibilities and their closely associated persons have conducted relating to financial instruments of Consti in accordance with the notifications the company has received and at latest within two business days after receipt of the notification. After the publication, information will also be available on the company's website.

Consti has additionally defined e.g. management team members of Consti's subsidiaries as well as persons dealing with preparation of financial reporting as persons who act in the informative core of the company, i.e. persons who have access to such informative core of the company on the basis of the tasks they deal with ("persons who act in the informative core"). People employed by Consti and people who work for Consti under a contract, and who, due to their duties, have access to insider information associated with Consti, are entered in the company's project-specific insider register, which is established when necessary.

Persons discharging managerial responsibilities or persons who act in the informative core of the company shall not trade or conduct other transactions, on their own account or for the account of a third party, directly or indirectly, relating to Consti's financial instruments during the so called closed window. The closed window begins 30 days prior to the publication of Consti's interim reports, half-year financial report or financial

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statement bulletins. The trading prohibition also applies to the day when results are published. Project-specific insiders are prohibited from trading in the company's financial instruments until the project concerned has been cancelled or disclosed.

Consti's CFO is responsible for adherence to insider regulations and for monitoring the duty to declare as well as the maintenance of insider registers.

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