SSAB — Annual Report 2020

Business segments

SSAB is structured across three steel divisions: SSAB Special Steels, SSAB Europe and SSAB Americas, and two subsidiaries: Tibnor and Ruukki Construction.

SSAB SPECIAL STEELS

Global steel supplier and service partner in Quenched & Tempered Steels (Q&T) and Advanced High-Strength Steels (AHSS)

Global product brands with a unique market position

Main production site:

• Oxelösund, Sweden

of SSAB Group's revenue

SSAB EUROPE Leading Nordic-based premium steel producer of high-quality strip, plate and tube products

Focus on the home market and selected growth areas like high-strength steels for the automotive segment

Main production sites:

Borlänge, Sweden
Hämeenlinna, Finland
Luleå, Sweden

revenue

• Raahe, Finland

of SSAB Group's of SSAB Group's total EBITDA

SSAB AMERICAS

Market-leading North American producer of quality steel plate and coil

Strong production base with an industryleading quality and cost position

Nearly 100% scrap-based production

Main production sites:

Mobile, Alabama, US
Montpelier, Iowa, US

revenue

of SSAB Group's total EBITDA

TIBNOR

Leading supplier of steel, other metals and processing services in the Nordics and Baltics

13% 6%

of SSAB Group's revenue

of SSAB Group's total EBITDA

RUUKKI CONSTRUCTION

Sustainable building and construction products and services in Europe

of SSAB Group's revenue

of SSAB Group's

total EBITDA

20% 11%

The Nordics Flat carbon steels and tubes

HIGHLIGHTS OPERATING ENVIRONMENT STRATEGY BUSINESS SEGMENTS

Scrap-based EAF steel production, heavy

Montpelier, Iowa, US SSAB Americas

Crude steel production capacity 1.2 Mtonnes Employees: 500 Established: 1997

Scrap-based EAF steel production, heavy

Mobile, Alabama, US SSAB Americas

Crude steel production capacity 1.2 Mtonnes Employees: 700 Established: 2001

plate

Global presence

SSAB has a cost-efficient and flexible production system. SSAB's production plants in Sweden, Finland and the US have an annual steel production capacity of approximately 8.8 million tonnes.

SSAB FOCUS MARKETS

The Nordics Flat carbon steels and tubes

North America Heavy plate

Globally Automotive (Advanced High-Strength Steels, AHSS)

Special Steels Quenched & Tempered (Q&T) and AHSS

SSAB main production sites

SSAB processing sites
Sales coverage

Blast-furnace-based steel production Crude steel production capacity 2.3 Mtonnes Employees: 1,100 Established: 1941 SSAB Europe

Luleå, Sweden

Strip products Borlänge, Sweden SSAB Europe

Oxelösund, Sweden

production capacity Established: 1913

Globally High-strength steels (QT & AHSS)

Blast-furnace-based steel production, heavy plate and strip products Crude steel production capacity 2.6 Mtonnes Employees: 2,500 Established: 1960

Hämeenlinna, Finland SSAB Europe

Strip products and tubes Employees: 1,000 Established: 1972

SSAB ANNUAL REPORT 2020

HIGHLIGHTS OPERATING ENVIRONMENT STRATEGY BUSINESS SEGMENTS

2020 in brief

Key figures

	2020	2019
Revenue, SEK million	65,396	76,485
Operating profit before depreciation/amortization, EBITDA1), SEK million	3,364	6,375
Operating profit1), SEK million	-325	2,159
Profit after financial items1), SEK million	-802	1,770
Earnings per share, SEK	-0.50	1.04
Operating cash flow, SEK million	3,460	5,194
Dividend per share, SEK - 2020 proposal	0.00	0.00
Energy consumption, GWh	9,083	9,088
Carbon dioxide emissions2), thousand tonnes	8,844	9,582
Employees3)	13,974	14,514
Lost time incident frequency (LTIF)4)	3.7	4.2

1) Excluding items affecting comparability

2) Direct emissions from production (Scope 1)

3) Permanent employees at year end

4) Number of accidents resulting in an absence of more than one day per million working hours, including contractors

Revenue SEK, m

Operating profit/loss1)

1) Excluding items affecting comparability

Injury frequency

Lost time injury frequency (LTIF) Total recordable injury frequency (TRIF)

HIGHLIGHTS OPERATING ENVIRONMENT STRATEGY BUSINESS SEGMENTS

The SSAB Way

The framework for our cultural elements is known as The SSAB Way. It is our way of describing the culture that has made and continues to make us successful, not only in our home markets in the Nordic region and the US, but also globally. It concludes who we are, what we do and how we do it, and it describes what we as a company have to offer. We in SSAB believe that what we do today creates ripples in the water; our actions have an impact both inside and outside of our company.

The SSAB Way includes our vision as well as our values. The SSAB Way also encompasses our strategy, company story, employee criteria, SSAB One principles and our Code of Conduct.

Who we are

Vision What we would like to achieve, today and over

time, "worth striving for"

Values

Our fundamental beliefs, our personality upon which our existence is based, "helps us determine right from wrong"

What we do Strategy

Taking the Lead

Story

How we communicate our history, current priorities and future to different stakeholders

How we do it Criteria

Expectations of our people: What characterizes us. Our behavior, "what it takes to be part of the SSAB team"

SSAB One Principles

How we achieve results: Our way of working to continuously improve, "makes us never stand still"

Code of Conduct

The way we act

HIGHLIGHTS OPERATING ENVIRONMENT STRATEGY BUSINESS SEGMENTS

Vision and values

Our vision

A stronger, lighter and more sustainable world

Together with our customers, we will go further than anyone else in realizing the full potential of lighter, stronger and more durable steel products.

Our values Driven, True, Ahead

Values – our fundamental beliefs, our personality upon which our existence is based "helps us determine right from wrong".

HIGHLIGHTS OPERATING ENVIRONMENT STRATEGY BUSINESS SEGMENTS

SSAB's value creation

SSAB's value creation model describes how value is created through our business model for SSAB and our stakeholders. Using HYBRIT technology, SSAB aims to be the first steel company in the world to bring fossil-free steel to the market in 2026. With the help of fossilfree steel and a fossil-free value chain, SSAB will reduce the carbon footprint in the steelmaking process and thus help other sectors such as Automotive, Heavy Transport and Construction to become fossil-free from a lifecycle perspective.

FINANCIAL

Average capital employed: SEK 79.3 billion
Equity: SEK 54.1 billion
Long-term liabilities and provisions: SEK 12.2 billion

PEOPLE

14,000 employees in more than 50 countries
Subcontractors and service providers

NATURAL RESOURCES

Iron ore pellets: 6.4 Mtonnes
Scrap metal: 3.7 Mtonnes
Coal, coke and other reducing agents: 2.3 Mtonnes
Other raw materials: 1.6 Mtonnes
Fuels: 4,607 GWh
Electricity: 4,455 GWh
Water: 379 Mm3

INFRASTRUCTURE

5 steel production sites
Other production and processing facilities
Steel Service Centers
Hardox Wearparts network,
540 members • Stocks and distribution network
Sales office network

EXPERTISE AND REPUTATION

Research and development
Knowledge in high-strength
steels
Knowledge of customers' applications
Expertise in technical support
Brands and brand programs • Patents

SOCIAL/RELATIONSHIP

Strong, responsible supplier network, 20,000 suppliers • Global sales network
Joint innovation projects with customers
Customer training
Community engagement
Industry and government participation

VISION Input SSAB Output Outcome

VALUES

Driven, True, Ahead

STRATEGY

Taking the Lead strategy SSAB One management philosophy

PRODUCTS AND SOLUTIONS

SSAB Special steels: 1.1 Mtonnes • Automotive premium steels: 539 Ktonnes
Other high-quality strip, plate and tubular products: 4.8 Mtonnes
Construction products and solutions worth SEK 5.5 billion
Technical support
Innovation support
Customer partnership

BY-PRODUCTS

Residuals utilized internally or externally: 3.6 Mtonnes
Scrap metal for recycling: 3.7 Mtonnes
Electricity generated from process gases: 1,184 GWh
Heat sold externally: 1,097 GWh

EMISSIONS AND WASTE

Emissions into the air:
CO2: 9,988 Ktonnes (Scope 1+2) – SO: 2.5 Ktonnes
2– NOx: 3.3 Ktonnes
Particles: 0.5 Ktonnes
Waste: 445 Ktonnes

ECONOMIC VALUE CREATED AND DISTRIBUTED TO STAKEHOLDERS

Payments to suppliers of raw materials, goods and services
Employee wages and benefits • Dividends, interest payments and financial expenses
Taxes to the public sector
Donations and sponsored local activities

BETTER STEEL FOR OUR CUSTOMERS

Innovative, sustainable steel applications
Customers' improved competitiveness
Reduced impact on the environment through higher penetration rate of high-strength steels globally; end products made from less raw materials, with lower weight and fuel consumption, increased load capacity and longer lifespans all leading to reduced CO2 emissions in the use phase
Improved energy efficiency in buildings
SSAB aims to bring fossil-free steel to the market in 2026

RESOURCE EFFICIENT OPERATIONS

More efficient use of natural resources and reduced CO2 emissions by utilizing residuals and recycled steel as raw materials
Improved energy efficiency through energy recovery and systematic energy management
Contribution to climate change mitigation and future fossil-free steel production using HYBRIT technology

LEADING SUSTAINABILITY PERFORMANCE

A safe and healthy work environment for SSAB's employees and contractors
Equal opportunities for a diverse and inclusive workforce
Opportunities for skills and career development for employees
Ethical business practices throughout the value chain
Long-term contracts and relationships with suppliers
Creation of local employment through own operations and local sourcing
Local sponsorships and internships
Attracting future employees

Operating environment

Complex factors govern SSAB's opportunities and risks both in our home markets and further afield. The company carefully and continuously monitors global economic and social development to shape our strategic decisions.

SSAB ANNUAL REPORT 2020

HIGHLIGHTS SSAB AND 2020 IN BRIEF STRATEGY BUSINESS SEGMENTS OPERATING ENVIRONMENT

Global megatrends affecting SSAB

Population growth and urbanization	Digitalization	Changing geopolitical landscape
DESCRIPTION • Growing global population • Rapid urbanization primarily in developing countries • Urban areas need to be continuously developed to manage the increasing complexity IMPACTS ON STEEL INDUSTRY DYNAMICS • Increasing demand for steel in construction, infrastructure and energy sector • Increasing demand for sustainable and energy-efficient buildings SSAB'S RESPONSE • Developing new products and offerings to meet future challenges • Offering broad spectrum of products to be used in construction and infrastructure, as well as in construction machinery and renewable energy plants	DESCRIPTION • New technologies available at affordable cost • Digitalization impacting the business model for most companies IMPACTS ON STEEL INDUSTRY DYNAMICS • More efficient operating practices available • Digital services adding more transparency in the value chain • E-commerce and trade platforms impacting demand-supply dynamics SSAB'S RESPONSE • Using robotics, machine learning and advanced analytics to improve production stability and process efficiency • Renewing digital service portfolio to improve customer experience • Developing new digital tools such as SSAB SmartSteel to help customers realize the full potential of our steel • New 3D-printing facility planned in Oxelösund	DESCRIPTION • Increasing protectionism (e.g. trade protection measures) • Increasing steel demand in developing economies IMPACTS ON STEEL INDUSTRY DYNAMICS • Higher importance of regional markets • Restrictions on trade and other cross-border flows SSAB'S RESPONSE • Securing leadership positions in our home markets with cost leadership and preferred supplier status • Taking an active stance for free and fair trade • Advancing SSAB's position in emerging markets for high-strength steels • Improve production capabilities, so that each site can cover a broader product range

OPERATING ENVIRONMENT

Steel market and SSAB's position

The year 2020 was a turbulent one in the global steel industry. Steel industry dynamics are shaped by developments in steel demand, steel supply, steel trade flows and the raw material market. These were all affected by the global Covid-19 pandemic, as well as by longer-term underlying trends. SSAB is exposed to this overall steel industry context, but is a relatively small player in the global steel industry in terms of production capacity, and has specialized in certain segments within flat carbon steels.

Four fundamental forces shaping steel industry dynamics

1. Steel demand Global steel demand taking a severe hit due to Covid-19

Steel demand started to show signs of improvement in early 2020 after a challenging second half of 2019, but soon faced severe headwinds due to the coronavirus outbreak. In general, apparent steel demand held up relatively well in the beginning of the outbreak as customers restocked to mitigate future supply disruptions, but demand then dropped sharply across most markets and segments. Key steel-using segments, such as the automotive sector, ceased production completely during parts of the year because of the lockdown measures introduced in multiple countries. Furthermore, weak end-user demand and supply chain disruptions continuously caused challenges in most segments throughout the year. Steel demand started to steadily pick up toward the end of the year, but a recovery to pre-Covid-19 levels is expected to take time. China has demonstrated the fastest pace of recovery, while Europe and the US, for example, have shown a more moderate pace by comparison.

Innovation toward productivity and sustainability continue to drive new steel demand

Global megatrends and industry-specific trends shape customer demand across all industries, including the steel industry. For example, users in the construction and automotive industries are working at lower costs, improving safety and lightening the weight of their products, thereby

reducing their environmental impact. In the mining industry, customers are striving to increase the durability of equipment and reduce downtimes. The use of high-strength steels provides advantages in the form of stronger, lighter and more durable steel solutions. Use of these steels therefore continues to increase and has a higher growth potential than standard steels. Furthermore, multiple steel-using segments are showing a growing interest in low CO2 steel, where steel companies are now investing to bring solutions to market to meet strong customer demand.

2. Steel supply trends Industry taking action to balance supply and demand after the drop in the market

Excess steel production capacity, especially in China, but also in Europe, has been impacting steel industry dynamics since the financial crisis of 2008. However, apparent demand and effective capacity have become more balanced in recent years. Going into 2020, market expectations looked favorable until the pandemic started to unfold.

In most of the world, the steel industry was forced to take short-term actions to cope with declining demand. This included idling a large number of blast furnaces, taking outages at EAF facilities, and part time layoffs of employees. In some cases, blast furnaces have been permanently closed. Notably, the Chinese authorities worked actively to improve their domestic situation by stimulating demand, with a variety of stimuluses

HIGHLIGHTS SSAB AND 2020 IN BRIEF STRATEGY BUSINESS SEGMENTS

OPERATING ENVIRONMENT

to fuel economic recovery and reduce the effect on the steel industry.

Supply landscape transformation

2020 saw the continuation of a number of regional trends in how the supply landscape is transforming. In Europe, there is a strong push toward green technologies and more sustainable steelmaking processes. Despite talks of consolidation between steel companies, no large deals were announced. In the US, a number of greenfield initiatives to build new electric arc furnace mills continue. The US flat carbon steel market also saw the emergence of a new large steel company since the mining company Cleveland-Cliffs forward-integrated by acquiring AK Steel and most of the US assets from

Apparent demand for finished steel products

ArcelorMittal. In Asia, consolidation continues and Baowu overtook ArcelorMittal as the world's largest steel company.

3. Steel trade flows Increasing trade tensions

Global trade patterns have been scrutinized and debated in recent years, resulting in more and more countries installing protection mechanisms. The introduction of trade barriers was growing worldwide already before the coronavirus outbreak and the number of global trade cases has increased in recent years. Section 232 tariffs in the US may be the best-known measure, but several other regions have also introduced retaliatory measures. Additional measures were introduced during the coronavirus outbreak to

better control flows of imported steel. This can be seen for example in Europe, where countryspecific import quotas were used to a greater extent than earlier. Substantial trade policies will likely be in force for a number of years, and more may be introduced if perceived necessary to curb predatory trade practices. As such, they may dampen economic growth prospects and/ or hinder exports of niche materials, but should, on the other hand, at least in the short term, be supportive of steel prices in home markets.

Market regionalization

Trade policies combined with increasing steel demand locally have resulted in decreased trade, particularly between geographical regions. Extra-regional steel trade (i.e. excluding trade within the EU, NAFTA, CIS, etc.) has been on a downward path in recent years and accounted for 14% of global steel demand in 2019, down two percentage points from 2018. The US remains the largest net importer of steel, with a trade deficit of about 20 million tonnes in 2019, whereas Europe had a trade deficit of about 12 million tonnes. It is notable that China, which has historically been a major net exporter of steel, has been a net importer during parts of 2020 following a strong domestic demand recovery. The coronavirus outbreak could be a further catalyst of market regionalization as companies may consider localizing supply chains and further trade policies may be introduced to save local jobs and support a green re-start of the economy (e.g. through carbon border taxes).

4. Input materials A sharp increase in iron prices

During 2019, iron ore prices rose to recent record levels. However, during the first part of 2020 iron ore prices started to come down only to sharply reverse upward during the second half of 2020. The main drivers for the increase in iron prices were production disruptions from some of the major low-cost producers, coupled with high demand based on high Chinese steel output rates. The combination meant that producers higher up on the cost curve had more influence over global iron ore prices. High iron ore prices had a negative effect on steel production profitability as producers were unable to pass on the increased costs to customers.

Steel prices

Steel demand, steel supply capacity, steel trade flows and input materials all impact the sales prices of steel products globally. Steel prices have been increasingly volatile and unpredictable in recent years and the Covid-19 pandemic has not contributed to stabilize prices. Looking at the prices during 2020, hot-rolled coil spot steel prices fell about 10% in Europe from the start of the year until the end of summer, at which point they started to recover and ended up 40% higher than the starting point of the year. Standard plate prices were especially affected, falling at the beginning of the year, but also recoiled and plate prices have increased by about 15% in Europe and close to 22% in the Americas.

Source: Worldsteel Short Range Outlook October 2020

SSAB's steel market position

SSAB is present in the steel segment commonly referred to as flat carbon steels (i.e. steels with a particular carbon content rolled into flat sheets or plates). With an annual steel production capacity of approximately 8.8 million tonnes, SSAB is a small player in the global carbon steel market. This is why SSAB specializes in and focuses on four defined segments within flat carbon steels, where we have strong market positions:

Flat carbon steel and tubes in the Nordics
Heavy plate in North America
Automotive premium steel (Advanced High-Strength Steel, AHSS) globally
Special steels (Quenched & Tempered, Q&T and AHSS) globally

SSAB has leading positions in our Nordic and North American home markets. SSAB has an overall market share of around 40% for flat carbon steels in the Nordic region. In North America, SSAB is the largest producer of heavy plate, with a market share of about 30%. With our leading products, brands, knowledge and well-invested asset base, SSAB also holds the number one position in the global market for Quenched and Tempered (Q&T) plate and strip, and in selected Advanced High-Strength Steel (AHSS) segments.

These market segments account for about 3% of the global market for carbon steel. In addition to being a steelmaker, SSAB is also a steel and nonferrous metal distributor via our subsidiary Tibnor, and offers steel-based construction solutions through our subsidiary Ruukki Construction.

The main customer segments served by SSAB include heavy transport, construction building and infrastructure, automotive, industrial applications, construction machinery (including lifting), energy and material handling (including mining). In our home markets, the Nordic region and North America, standard steels are also sold through steel service centers and distributors.

Customer segments

Heavy transport 16%
Construction 13%
Automotive 12%
Industrial applications 11%
Construction machinery 6%
Energy 5%
Material handling 3%
Service centers 34%

1) Defined as Quenched & Tempered (Q&T) flat products and Hot rolled Advanced High-Strength Steel (AHSS) ≥ 700MPa in targeted segments

2) Defined as hot-rolled, cold-rolled and coated Advanced High-Strength Steel (AHSS) strip products for automotive ≥ 420MPa

BUSINESS REVIEW

SUSTAINABILITY REPORT CORPORATE GOVERNANCE REPORT FINANCIAL REPORTS 2020

STRATEGY

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT BUSINESS SEGMENTS

Strategy

SSAB's strategy is to strengthen our leading positions in highstrength steels globally, in our home markets, and as a provider of value-added services.

SSAB ANNUAL REPORT 2020

STRATEGY

Taking the Lead

SSAB continuing the strategic direction

SSAB's strategic targets

SSAB EUROPE

Automotive AHSS

578

Premium share

539

800

Premium

30%

In 2020, we adjusted the specifics of each element in the Taking the Lead strategy to reflect the opportunities for coming years. The strategic targets were pushed back to 2023 (from 2022)

due to Covid-19 impacts. Furthermore, our strategy continues to emphasize our commitment to being first in iron ore-based fossil-free steel and leading sustainability performance.

40-45%

Market share in the Nordics (over time), SSAB Europe – supported by Tibnor and Ruukki Construction

Target 2023 Target 2023

STRATEGY

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT BUSINESS SEGMENTS

First in fossil-free steel

SSAB is undertaking a strategic roadmap to revolutionize steelmaking, and to be the world's first steel company to deliver iron ore-based fossilfree steel to the market in 2026. This includes an active leadership role in the HYBRIT joint venture initiative with LKAB and Vattenfall. The target is to be fossil free as a company by 2045.

Activities aimed at converting the production system to deliver fossil-free steel were running at full speed during 2020. The HYBRIT pilot plant in Luleå was inaugurated in August 2020 and the planning for a large-scale demonstration plant is ongoing with the target of being ready in 2025. Conversion to fossil-free steel production in Oxelösund using an electric arc furnace is also progressing at full speed. There is a growing interest from customers to lower the carbon footprint in their value chain, which opens up great potential for fossil-free steel as a premium product.

Leading homemarket positions

Maintaining the market leading position in SSAB's two home markets, the Nordics and North American plate, remains a foundation for SSAB. We intend to strengthen our position in the coming years and to increase the share of premium steel shipments.

During 2020, which was affected by the pandemic, SSAB's market share in the Nordics was slightly lower compared to 2019. Going forward, further growth with a focus on increasing the share of premium products will be achieved both through our own channels and in partnership with customers and external steel distributors with which we have long-term agreements. In North America, SSAB remains the market leader in heavy plate in terms of both profitability and market share. Going forward, SSAB Americas continues to develop the product mix toward premium shipments.

Global leadership in high-strength steels

SSAB is a global leader in Quenched and Tempered (Q&T) steels and in specific highstrength automotive applications (AHSS). Both offer good growth opportunities in the coming years as fundamental trends drive the use of high-strength steels.

SSAB's volumes in 2020 were affected by the Covid-19 outbreak. However, SSAB's volumes through SSAB Special Steels' own distribution channels to small and mid-size customers were more stable, while sales of lower grade midsegment products to large OEMs declined more year on year. In Automotive, SSAB outperformed the total steel market due to focus on premium AHSS products.

Share of premium products in SSAB Americas in 2020

SSAB ANNUAL REPORT 2020

STRATEGY

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT BUSINESS SEGMENTS

Leading valueadded services

Value-added downstream services are important channels to market for SSAB. They also represent an important growth area for SSAB's long-term development, as many customers require more services and complementary products to process SSAB steels.

We have further strengthened our position within value-added services (e.g. through global stock sales and by leveraging Abraservice, which was acquired in 2019). Tibnor has successfully delivered on a cost reduction program and holds a leading position in all Nordic markets. Furthermore, Ruukki Construction has completed a portfolio transformation and has now raised its overall profitability by focusing on the roofing and building envelopes businesses.

SSAB ANNUAL REPORT 2020

SSAB is committed to offering a superior customer experience by outperforming competitors on delivery performance, quality and overall service level and satisfaction. SSAB will also further develop digital services and find new ways to engage with customers.

The results in the 2020 customer survey developed positively, with an NPS (Net Promotor Score) of 39 (and number 1 position in the US Jacobson survey). However, there is still scope for further improvement. SSAB will continue focusing on quality, lead times, delivery performance and sales responsiveness. We will also invest in technical support and joint innovation initiatives to help our customers to get the best out of SSAB's high-strength steels. SSAB continues to focus on growing digital services where the number of users of the customer portal is growing month by month and further development of e-commerce and EDI capabilities are ongoing.

Most flexible operations

SSAB has the highest focus on efficiency, reliability and flexibility in our global production system. Through SSAB One, the goal is to involve all employees in achieving continuous improvement. Also, digitally enabled improvement initiatives in operations will be increasingly important in the coming years.

Flexibility in the production setup is one way for SSAB to be more resilient in periods of weaker demand. Following the Covid-19 outbreak,

1.1 3.7 million tonnes Special Steel shipments in 2020 (1.2)

38% Share of premium products in SSAB Europe (39%) Lost time injury frequency in 2020 (4.2)

STRATEGY

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT BUSINESS SEGMENTS

flexibility measures were introduced to adjust to falling apparent demand. The Nordic production system was adapted to run using three instead of five blast furnaces, and staffing was temporarily adjusted through flexibility measures.

High-performing organization

A key element of SSAB's business strategy is to build a high-performing organization with strong employee engagement globally. SSAB will continue to work with leadership and competence development, and strive to enhance diversity in the workforce.

In 2020, SSAB participated in multiple own and industry initiatives to attract talent to and enhance diversity in the company. One example of this is the Swedish Female Leader Engineer program. SSAB also continued to work with the updated company values introduced in 2019: Driven, True and Ahead, which summarize our commitment to working together to create value, being honest and always looking to the future. Our values are a key component of what we call The SSAB Way, which brings the SSAB vision, values and strategy, and principles together to strengthen our common culture.

Leading sustainability performance

Sustainability is the foundation for everything at SSAB. SSAB wants to offer a safe work environment, adhere to high environmental standards, and to be a responsible partner to all stakeholders. Engaging with customers in the area of sustainability, and the use of sustainable SSAB steels will enable SSAB to create greater business value. In 2020, SSAB adopted a new sustainability strategy, With the Future in Mind, with the objective of creating a closer link to the Taking the Lead strategy, SSAB's vision and core values.

SSAB strives to be the safest steel company in the world, with an objective to achieve zero accidents, work-related injuries or illnesses. Safety performance continued to improve in 2020, when the LTIF (Lost Time Injury Frequency) decreased from 4.2 in 2019 to 3.7.

Read more about SSAB's sustainability performance in our Sustainability report p. 45.

BUSINESS REVIEW

SUSTAINABILITY REPORT CORPORATE GOVERNANCE REPORT FINANCIAL REPORTS 2020

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

Business segments

SSAB is structured across three steel divisions: SSAB Special Steels, SSAB Europe and SSAB Americas, and two subsidiaries: Tibnor and Ruukki Construction.

SSAB ANNUAL REPORT 2020

SSAB Special Steels

Head of SSAB Special Steels: Johnny Sjöström (1974), EVP

Global steel supplier and service partner in Quenched & Tempered Steels (Q&T) and Advanced High-Strength Steels (AHSS)

3,200 Employees, approximately

16,143 MILLION SEK

Revenue in 2020

Steel shipments 2020

540 Hardox Wearparts members

130 Present in 130 countries

SSAB Special Steels' wide product portfolio includes a number of unique steel grades. Hardox - our global brand of wear steels - has the highest awareness of all brands in the steel market. Through close collaboration, we help our customers to utilize our high-strength steels to create new, innovative steel solutions and applications.

SSAB Special Steels aims to further strengthen its leading position in high-strength steels as well as in related value-added services. The market for high-strength steels has to a large extent been driven by SSAB. Since 2000, SSAB's shipments have increased by an average of around 8% a year, outperforming the general steel market. Structural growth is generated by manufacturers' needs for higher productivity and better sustainability performance in machinery and equipment. Upgrading components to more advanced steel enables weight reduction and extended service life.

Development of new products and applications often takes place in close cooperation with customers. As early as possible in the development of a new product – be it a tipper, a chute or a crane – SSAB's engineers work together with the customer in developing solutions that best utilize the properties of each steel grade.

With an estimated global market share of 25%, SSAB is the largest producer of high-strength steels. There is a large number of competitors with relatively small market shares and SSAB sells roughly three times more in terms of volume than its closest competitor. Most competitors focus on sales to service centers and large OEMs in selected markets. Apart from those segments, SSAB's unique global sales network enables us also to reach small and mid-size customers in all corners

25% Market share, Special Steels, approximately

of the world. This network includes own stock locations, local sales force as well as technical support.

To further develop the channels to the market, SSAB Special Steels is expanding the Hardox Wearparts network as well as SSAB Services. Hardox Wearparts is a network of mainly independent companies offering wear parts and just-in-time repair services to end-users in the local aftermarket in the mining, quarrying, recycling and construction sectors. SSAB Services focuses on providing products and services to machine builders and the after-market business. This strategy allows SSAB to maintain a high service level in smaller and fragmented markets, and also to gain exposure to end-users' operating expenditures (OPEX), which has a stabilizing effect over the business cycle. This has proven to be a successful strategy not only to increase the sales volume but also to drive further upgrading to

Strategic targets

Grow shipments by 23% from 1.1 million tonnes in 2020 to 1.6 million during 2023
SSAB Services is to increase revenue to SEK 4.5 billion during 2023 through a combination of organic growth and acquisitions

Strengths

Unique and highly advanced products
Flexible production system with SSAB Special Steels capacity in Oxelösund, Raahe, Borlänge and Mobile
Combined SSAB Special Steels capacity, including ongoing investments, of more than 1.6 million tonnes

• Unique go-to market model with a global network serving more than 130 countries

High product quality with consistent properties
Well-known and highly-respected product brands
Close customer collaboration and joint projects with customers result in highly paced development and increased competitiveness

Competitors

ArcelorMittal, Dillinger, Voestalpine, Nucor, Nippon, ThyssenKrupp, NLMK Clabeq

harder and stronger steels in line with our vision. This ability will be developed further in the future.

Growing the volume of high-strength steels is a key in the overall objective of the SSAB Group to improve the product mix. High-strength products are also made in the mills of SSAB Americas and

SSAB Europe and increasing those volumes means allocating less capacity to standard products. By 2026, when the steel mill in Oxelösund has been converted to an electric arc furnace (EAF) and the production of sponge iron using HYBRIT technology has started, SSAB Special Steels will be able to offer fossil-free premium products.

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

BUSINESS SEGMENTS

2020

Despite a challenging year, a solid strategy, a presence across all geographies and in different segments meant that shipments in 2020 totaled 1.1 million tonnes, just 8% below the figure for 2019. From a geographical perspective, Europe was the most challenging market and took the biggest drop in shipments, while APAC (Asia Pacific) and MEI (Middle East & India) grew by almost 10% year on year.

The stock business, serving the small and fragmented market, held up much better compared to direct business, which tends to supply the larger OEMs. The focus on strategic products proved to be right since the decrease in this part of the program was only half that compared to the rest of the offering. Raw materials handling was the strongest segment for SSAB Special Steels during 2020 and shipments

increased by almost 5%. Construction machinery (especially the sub-segment Lifting) turned out to be the weakest segment, with a substantial drop in volume year on year.

The strategy to provide added value remains firm, and new products and services were rolled out. Trays produced by one of the subsidiaries and licenses for bucket production are examples of areas that we have leveraged.

There were 27 new Hardox Wearparts Members appointed during 2020, but the total number of centers remained more or less on the same level as in 2019 because of offboarding companies not living up to expectations by being part of this cooperation program. The current focus is to grow the volume of SSAB's products through the network rather than to grow the number of members.

CASE: AUSTIN ENGINEERING INNOVATES LARGE MINING TRUCKS WITH HARDOX 500 TUF

Austin Engineering brings one-of-a-kind mining truck equipment and solutions to forward-thinking operations. Mining operations can choose to haul more material in fewer trips using less fuel and at a higher capacity or choose to haul the same amount of material over a longer truck body life with custom-designed truck bodies like Austin Engineering's brands of Westech and JEC bodies, using Hardox 500 Tuf.

SSAB.COM

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

BUSINESS SEGMENTS

SSAB Europe

Head of SSAB Europe: Olavi Huhtala (1962), EVP

Leading Nordic-based premium steel producer of high-quality strip, plate and tubular products

6,700

Employees, approximately

27,954 MILLION SEK

Revenue in 2020

3.3 MILLION TONNES

Steel shipments 2020

37%

market share in the Nordics in 2020

38% share of premium products

SSAB Europe is a leading premium producer of high-quality steel strip, plate and tubular products. The division stands out from other steelmakers through its know-how of production processes, applications of high-strength steels and value-added services.

BUSINESS REVIEW

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

Strategic targets

Reach a share of premium products of 46% (2023)
- 800,000 tonnes of Automotive AHSS shipments (2023)
900,000 tonnes of premium steel shipments (2023)
Market share of 40–45% in the Nordic market

Strengths

Market leader in the Nordics
Close collaboration and long-term commitment to customers combined with support services
Extensive product portfolio with unique automotive and premium steels supported by strong product brands
Leading technology and materials expertise, application know-how
Synergies from close cooperation with Tibnor and Ruukki Construction
Flexible service and supply chain adapted to end customer and distribution channels
Sustainable offering and among the most CO2 efficient BOF production in the world

Competitors

ArcelorMittal, Dillinger, Salzgitter, ThyssenKrupp, Tata Steel Europe, US Steel and Voestalpine

Strategy

The Nordic home market is core to SSAB Europe's strategy. The focus is on developing the product and service offering to strengthen the market leading position as the most reliable supplier and customers' first choice. Cooperation and synergies with Tibnor and Ruukki Construction are key elements in the strategy, as they support market share, profitability as well as resilience over the business cycle.

Improving the product mix remains an important area. By allocating a larger share of the production capacity to premium products, SSAB Europe can reduce shipments of standard products outside of the Nordic home market.

SSAB Europe has two main categories of premium products. First, advanced highstrength steels (AHSS), which are sold globally to the Automotive segment. Second, premium steels, which are sold in the European market to other industries. SSAB has a strong position in several automotive applications, among other things due to the most advanced products in the market for ultra high-strength martensitic steels. In vehicles, drivetrain electrification and hybrids are increasing the relative importance compared to traditional combustion engines. Low weight, keeping high-strength stiffness and safety performance remain key elements in all new vehicle design. This is why SSAB expects the AHSS market to continue to grow structurally as automotive manufacturers seek to reduce weight and improve safety performance.

In premium steels, SSAB Europe is continuing to focus on upgrading current customers from standard to premium products, and to develop new customer segments and applications. Key

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

growth-supporting initiatives seek to further promote end-user benefits through SSAB Europe's premium products and to enhance collaboration with multi-channel distributors (e.g. SSAB Laser Certified Partner network expansion, the GreenCoat partnership program, new premium product launches and digitalization initiatives).

In construction and industry, decarbonization initiatives will also create opportunities for upgrading to premium steels in different applications. For example, the Sustainable Europe Investment Plan, one of the pillars of the Green Deal, will boost sustainable projects such as renewable energy generation and other needed infrastructure in the EU.

2020

The Covid-19 outbreak and related industrial and economic lockdown experienced since March 2020 have had a massive impact on the output of steel-using sectors, with plant closures, capacity reductions and huge supply chain disruptions. The drop in real steel consumption is estimated to be around 11.5%* year on year, with the Automotive segment being the hardest hit and the construction segment the least affected. Despite the fall in steel shipments, SSAB Europe managed to keep our share of Premium products stable from the previous year's level at around 40%. Furthermore, whereas steel-weighted industrial production

in Automotive is estimated to have decreased 20.6%* year on year, SSAB Europe's AHSS sales to the automotive segment decreased just 7% year on year. Premium steel volumes were 719 thousand tonnes, which in principle was unchanged compared to 2019. SSAB Europe's market share in the Nordic home markets decreased slightly to 37%, due to increased competition. Operating result decreased to SEK -1,113 million, which was mainly due to the sharp drop in steel shipments and prices during Q2-Q3, and increased costs due to lower capacity utilization. Extensive cost savings and capacity adjustments were carried out to counteract the strong decrease in turnover. Fixed costs decreased by a total of around SEK 620 million compared to 2019.

Reduced work time in SSAB Europe during most of 2020, together with delayed car model launches, meant that some product development projects were also pushed back. However, we managed to grow our material approval basket by investing significant resources and finalized more than 10 Automotive OEM grade approvals. Product development in Automotive was focused on improving existing grades and also launching new ones (e.g. Docol HR800CP (improved) and Docol 800 HE). In Premium products, high-strength SSAB Weathering grade expansion continued from plate to strip products.

* Eurofer Quarter 4-2020 report

CASE: SHAPE CORP.

Shape Corp. from the United States was awarded the Swedish Steel Prize in 2019 for the groundbreaking use of martensitic steel in a 3D formed tube for automotive roof rail applications. With great skill, Shape Corp. has shown the way forward and has succeeded in efficiently utilizing a modern material with the highest possible strength level. This shows a major opportunity in challenging other lightweight materials with a steel solution that allows for circular material flows.

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SSAB Americas

Head of SSAB Americas: Charles Schmitt (1959), EVP

Market-leading North American producer of quality steel plate and coil

SSAB Americas is the largest producer and supplier of steel plate in North America, strongly positioned and highly recognized in the region for cost efficiency and quality.

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

Strategy

The foundation of SSAB Americas' strategy remains unchanged, with a focus on a high level of service and superior quality, while maintaining the lowest cost position and the most flexible setup in the market, as well as leadership in safety. SSAB continues to invest in more advanced production capacity; therefore, a higher share of the production capacity in North America continues to be allocated to high-strength steels (sold by SSAB Special Steels) and premium products in the future. This will strengthen the overall product mix of the SSAB Group.

Against this backdrop, in 2019, SSAB Americas developed a new go-to-market and service model, targeting a diverse customer base with a higher share of fabricators and OEMs than previously. At the same time, the portfolio of products and services will be differentiated to facilitate more growth of premium volume, such as products targeted to the energy, offshore, and railway and shipbuilding segments.

The mid-term outlook for plate demand remains uncertain as the industry recovers from the downturn created by Covid-19. Longer term, there will be opportunities as there remains a significant need to reinvest in infrastructure in North America. If more investments materialize long-term, several end-user segments, such as heavy fabrication and construction equipment,

30% Share of premium products in 2020

will benefit. Also, demand from wind energy is expected to remain positive in the long-term.

2020

SSAB Americas' operating result decreased in 2020 to SEK -293 (2,128) million, mainly due to significantly lower sales margins. The year started with relatively stable plate prices, which resulted in healthy margins during the first quarter of 2020. Prices began to decline in the second quarter and continued to decrease through mid-year as the organization battled the industry downturn brought about by Covid-19.

BUSINESS REVIEW

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

Strategic targets

Increase the share of premium products to 39% by 2023 (2020: 30%)
Increase the share of shipments to end-users to be more than 50% (2020: 36%)

Strengths

• Strong North American production base with industry-best quality and a leading cost position

Two modern steel production facilities utilizing electric arc furnaces (EAF), which use recycled scrap metal as raw material
Close partnerships with customers to develop unique customized products and solutions

Competitors

Domestic steel producers, such as Nucor, ArcelorMittal, Evraz, Essar Algoma and imported products

SSAB is the largest producer and supplier of heavy plate in North America and the market share increased during 2020 to approximately 33% (27). Demand from steel service centers decreased throughout 2020. Steel service centers account for SSAB Americas' primary customer segment, although the share is expected to decrease over time as part of the new go-to-market model. Other important market segments including heavy transport and energy were also hit during 2020 by Covid-19.

SSAB Americas maintained its number one industry position in quality based on third-party survey results. The share of premium products was 30% (33).

BUSINESS REVIEW	SUSTAINABILITY REPORT	CORPORATE GOVERNANCE REPORT		FINANCIAL REPORTS 2020
HIGHLIGHTS	SSAB AND 2020 IN BRIEF	OPERATING ENVIRONMENT	STRATEGY	BUSINESS SEGMENTS

Tibnor

Head of Tibnor: Kimmo Väkiparta (1965), President

Leading supplier of steel, other metals and processing services in the Nordics

1,000

Employees, approximately

Revenue in 2020

25%

market share in Nordic steel distribution

50%

of sales are SSAB's products

Tibnor distributes steel and other metals to the industry in the Nordics and Baltics, complemented by a wide range of value-adding processing and parts production services. Tibnor plays an important role in securing SSAB's leadership in the Nordic home market.

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

Strategy

Tibnor's strategy is to provide customers with the broadest offering at the most competitive price. The focus is to win market shares through growth in all customer channels, including parts volumes with a new, more efficient parts production setup and growing the digital channel share to 40%. With implemented synergies from the acquisition of the steel distribution business of Sanistål A/S in Denmark, and substantial cost savings implemented during 2020, Tibnor's cost focus going forward is on purchasing and transport costs, as well as on further automation. These measures will allow Tibnor to leverage its market position and reach industry-leading profitability.

Working in close collaboration with strategic suppliers and partners, Tibnor aims at being the center of smarter solutions, thereby strengthening Nordic industry.

2020

The Nordic steel distribution market was characterized by a rapid decline in Q2 due to the Covid-19 pandemic, with volumes 20% lower than last year. OEMs and subcontracting segments were hardest hit, while the construction segment held up better. The market started a slow recovery during the second half of the year.

Tibnor initiated a substantial cost saving program at the end of 2019. This was fully implemented in Q3 2020 and offset the slowdown well. Tibnor continued to deliver positive results as well as winning market shares throughout the year.

Tibnor had a market share of around 25% of the Nordic distribution market in 2020. The distribution and processing business accounted for about 80% of sales, with direct mill supplies accounting for the remaining 20%. Strategic initiatives and targets

Ensure good availability based on customer needs
Implement cost savings measures in external purchasing and transport costs
Reach an EBITDA margin of more than 5% in 2022
Reach a ROCE of more than 15% in 2022

Tibnor's role in SSAB's portfolio:

• Strengthen home-market position by targeting small and medium-sized customers

Increase stability over the business cycle
Support and market SSAB steel business' premium and service offerings
Develop the parts business and other processing to increase value added
Offer superior customer experience (24h lead time and >95% delivery accuracy)

Competitors

BE Group, Stena Stål, Norsk Stål, Lemvigh Muller and Kontino, as well as a number of national local companies and niche actors

CASE: VESTRE

TIBNOR.SE

For the Norwegian outdoor furniture manufacturer Vestre, only the best steel is good enough. Tibnor has been supplying it to Vestre for several years, while also providing its customer with first-class processing services, deliveries and shipping warehouse. Responsibly.

SSAB ANNUAL REPORT 2020

Ruukki Construction

Head of Ruukki Construction Sami Eronen (1971), President

Sustainable building products and services in Europe

Ruukki Construction offers sustainable building products and services such as roofing and envelopes. Core business segments are non-residential and residential construction.

BUSINESS REVIEW

Strategy

Ruukki Construction has over the past years divested non-core businesses and created a foundation to achieve profitable growth. Following completion of the divestment of the Building Systems business unit in May 2020, Ruukki Construction is able to fully focus on growth in its product businesses within Roofing and Building Envelopes in the core market areas: the Nordics, Baltics and CEE. During past years, Ruukki Construction has successfully grown strongly in its core businesses.

Ruukki Construction will continue to develop the core business units with SSAB as its main steel supplier. Ruukki Construction's goal is to offer its customers complete roofing and building envelope product deliveries, including design and technical support. In its core business,

Ruukki Construction focuses on outperforming construction market growth, both organically through an already launched commercial excellence program and portfolio development as well as by considering acquisitions to strengthen the offering in prioritized segments and markets.

2020

Recent years have seen strong demand in all core areas, but growth is now gradually plateauing, although at a healthy level. During 2020, Covid-19 had negative, but relatively soft and market area specific, impacts on demand. In 2020, Ruukki Construction continued to develop its business through commercial excellence activities and continuous efficiency improvements to outperform market growth. In line with the strategy, Ruukki Construction

Strategic focus areas and targets

Safety
Outperform the general construction market growth in core markets
Continuous improvement in unit cost and capital efficiency
"SSAB ONE in Ruukki" implementation
Reach an EBITDA margin of more than 10% in 2022

Strengths

• Recognized brand in core markets and customer segments

Product and service innovations
Reliability with high quality, sustainable and certified products as well as extensive warranties
Strong know-how in steel-based building products

Competitors

Steel-based building product suppliers Kingspan, Lindab, and locally Areco & many other smaller companies

continued to develop the portfolio by improvement updates to existing products and by launching new ones (e.g. Primo façade claddings). Revenue was relatively stable in 2020 on a like-for-like basis and operating profit increased to SEK 314 (283) million.

CASE: EUROBEEF'S COLD STORAGE FACILITIES, KOŁO, POLAND

Ruukki Construction supplied the sandwich panels for the walls, dividing walls and roofs of Eurobeef's new production facilities. Eurobeef is a meat-processing company and so complies with strict cold storage and food hygiene regulations. The customer was convinced by Ruukki Construction's comprehensive range of high-quality panels used in various parts of buildings and which conform to various requirements.

RUUKKI.COM

HIGHLIGHTS SSAB AND 2020 IN BRIEF OPERATING ENVIRONMENT STRATEGY

BUSINESS SEGMENTS

Research and Development

SSAB's R&D model has long since been built on close collaboration and an understanding of both customer and end-user needs. With this well-established model, we continuously introduce valuable new steel products, application possibilities and services, always with a strong focus on our company vision strategy; a stronger, lighter and more sustainable world.

SSAB's R&D organization plays a key role for the constant development of our production processes, in building a strong product portfolio and technical know-how supporting our customers to fully utilize the potential of our steels. Constantly striving for the effective use of resources in producing and using steel has given us our current position as a premium producer of advanced high-strength steels and wearresistant steels with one of the world's most CO2 effective steelmaking processes. As we are now moving forward with HYBRIT and our fossilfree roadmap, SSAB R&D will continue to work with the same high fossil-free ambition for our products and customer applications.

Market driven R&D

Our R&D culture is striving toward SSAB products always being the first choice of customers worldwide and setting the standard for performance in selected market segments. And being truly market driven means having

the ability not only to understand but also to translate customer and end-user needs into relevant products. R&D activities take place throughout the development chain; from production processes to products and into customer applications.

R&D facilities:

Borlänge and Oxelösund (Sweden)
Raahe and Hämeenlinna (Finland)
Montpelier (Iowa, US)

Many of our employees at these research facilities hold doctorate degrees and we have strong academic partners, universities and research institutes who we collaborate with on a long-term strategic basis.

SSAB key factors for successful R&D:

Market-driven
Qualified and skilled employees
Effective portfolio and project management

SSAB works both directly with OEMs, subcontractors and end-users through our own sales force and via distributors, as opposed to many steel companies, who sell products only via distributors. We support our customers in developing better and more competitive products, helping endusers to increase productivity and thereby to reduce costs during the usage phase.

To remain at the forefront in the industry, SSAB will continue to invest in research

and development, technical customer support and joint innovation initiatives to get the most out of SSAB's market offering. At the same time, the organization strives toward superior customer experience, which means the highest standards in terms of product quality, shorter lead times, delivery performance, digital portals and channels for smooth interaction.

Focus on effective problem-solving
Work environment that encourages collaboration and innovation
Strong external partner network

Long-term research agenda

To stay ahead, the R&D organization needs to balance the present and long-term perspective. We need the ability to pursue research we recognize as breakthrough and to be part of our customer's future or changes in the outside world. Long-term projects can last five to ten

years and different parts can be supported by external academic partners and governmental funding.

Hardox

Hardox 500 Tuf, the new generation of Hardox wear plate, continued to gain interest in the market and sales grew compared to last year. During the year, we extended the dimension window for thin plates, which led to new possibilities in applications such as dump truck bodies.

In 2020, we launched Hardox HiAce, which is targeted at applications in acidic and corrosive environments, where it is highly valuable for applications such as garbage trucks, waste-toenergy plants (biomass), sawmills and paper mills.

Strenx

Strenx 1100 Plus, a structural steel optimized for the demanding lifting segment, continued to gain interest in the market. Strenx 1100 Plus is unique in its capacity to achieve a strength truly matching that of welded joints.

Automotive steels

During 2020, SSAB commercialized the strongest

cold-forming steel on the market, Docol 1700M, with a tensile strength of 1700 MPa. In general, ultra-high strength martensitic steels, where SSAB is the global market leader, are being increasingly used in newly developed cars, including electric vehicles.

Another trend in Automotive is the introduction of novel cold-forming steel grades (3G AHSS), with an improved combination of strength and ductility in order to compete with press-hardening steels for components with the most advanced geometries. During 2020, SSAB launched the second grade in the 3G AHSS family and more grades are under development.

The Swedish Steel Prize

The Swedish Steel Prize, an international award for ideas and products that have an impact on future steel solutions, is also an example of SSAB's close customer relationships. Since 1999, the competition has attracted participants from across the world, and is more than just an award, it is a celebration of good engineering. The

Swedish Steel Prize aims to recognize those who fully utilize the potential of steel properties to improve not only their own business or industry, but also society. It also promotes the sharing of knowledge, to inspire innovations that lead to a better world.

Protection steels

Over the past few years, we have further developed the product program for protection steels, focusing the production of Armox in Oxelösund and Ramor in Raahe. SSAB is today the only supplier of complete product programs regarding grades and dimensions. We offer outstanding mechanical properties, which in most cases outperform the requirements of various national protection steel standards, combined with excellent workshop properties such as bending capabilities and weldability.

Color-coated steels

Over the past few years, SSAB's patented Biobased Technology (BT) coating concept utilizing rapeseed oil-based paint has been implemented throughout the GreenCoat product program.

GreenCoat PLX Pural BT with SSAB patented biotechnology was launched during 2020. The product offers the excellent steel properties of one of SSAB's best steel grades combined with a matching newly developed sustainable paint system.

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

SSAB ANNUAL REPORT 2020

SUSTAINABILITY REPORT

Sustainability approach 45

Sustainability strategy	46
Sustainability targets beyond 2020	48
Sustainability targets ending 2020	52
SSAB and the value chain	54

First in fossil-free steel 56

Use better steel: SSAB's customers benefit from leading CO2 efficient production 57 Use steel better: Environmental benefits with
SSAB's steels 59
Go fossil-free: SSAB to be the first in
fossil-free steel with HYBRIT technology 63

Leading sustainability performance	66
Safety first: Becoming the world's safest
steel company	67
Resource efficient operations	71
Material efficiency and recycling	76
Energy efficiency	78
Water recirculation in the production
process	80
Responsible sourcing	81
Zero tolerance for bribery and corruption	84
High-performing organization	87
Human rights and fair labor conditions	93

GRI Report Supplement 94 Reporting practice 95 Sustainability governance 96 Stakeholder engagement 98 Materiality assessment 101 GRI index 110 Climate-related financial disclosures (TCFD) index 114 Auditor's Combined Assurance Report on SSAB AB (publ)'s Sustainability Report and statement regarding the Statutory Sustainability Report 115

SUSTAINABILITY APPROACH

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Sustainability approach

We want to become the first fossil-free steel company in the world. Therefore, our vision is at the core of our entire operation. In everything we do, we strive to create a stronger, lighter and more sustainable world. Sustainability is a key business driver for both us and our customers. Consequently, we put much effort into ensuring that we act in an ethical and environmentally sound way in all our operations and markets.

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Sustainability strategy

Managing business in a sustainable way strengthens the ability to deliver strong financial and operational results. We renewed our sustainability strategy during 2020. The new strategy has its basis in SSAB's "Taking the lead" strategy, while it is also building on The SSAB Way, SSAB's core values and the First in fossil-free steel ambition. The strategy is called "With the future in mind" and it has two main themes: First in fossil-free steel and Leading sustainability performance.

With the Future in Mind

First in fossil-free steel Use better steel

SSAB is committed to minimizing any adverse environmental impacts from our operations. Therefore, SSAB focuses on continuous improvement to minimize emissions and improve productivity, as well as material and energy efficiency. SSAB's blast furnace-based production is among the most CO2 efficient in the world. This gives a competitive advantage to SSAB and its customers. For example, our cold-rolled steel production emits approximately 6% less CO2e than the European average and as much as 17% less than the Chinese average.

Use steel better

The core of SSAB's business is to develop and produce Advanced High-Strength Steels (AHSS) and Quenched & Tempered (Q&T) steels that are stronger than ordinary steels. This in turn enables our customers to produce lighter and stronger products, thereby reducing their environmental footprint.

By using SSAB's high-strength steels, which results in lower weight and improved fuel

economy, customers can achieve significant CO2 savings during their end products' use-phase. The objective is that, by the end of 2021 these annual customer CO2 savings will reach 10 million tonnes, which equals SSAB´s own direct CO2 emissions.

Go fossil-free

SSAB works toward a fossil-free steelmaking process through the HYBRIT initiative and by eliminating other fossil related emissions, with a goal to offer fossil-free steel to the market in 2026. In cooperation with LKAB, our iron ore supplier, and Vattenfall our energy provider, we form a fossil-free value chain. In 2020, we started discussions to partner with key customers and stakeholders for future fossil-free steel shipments.

Leading sustainability performance Safety first

SSAB is determined to be the world's safest steel company, with the objective of achieving zero accidents, work-related injuries and illnesses. Everyone has the right to a healthy, accident-

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

free work environment in SSAB. Our goal is to prevent all injuries and work-related illnesses. We will minimize, as far as possible, health and safety risks everywhere we operate.

Efficiency and responsibility Resource efficient operations

For SSAB, circularity is a key factor in increasing efficiency to help mitigate environmental impact. We continuously work to optimize the value of our by-products, scrap and waste, with a focus on sustainability and value creation. SSAB is committed to the efficient use of raw materials and energy. To further improve energy efficiency, energy flows are recycled in the production process.

Responsible sourcing

SSAB has approximately 20,000 active suppliers in more than 60 different countries. SSAB works actively with particularly high-risk suppliers to ensure sustainability throughout the supply chain. Suppliers must comply both with SSAB's standards and with international ethical, social and environmental guidelines in order to remain qualified suppliers for SSAB.

Respect and integrity Zero tolerance for bribery and corruption

The Code of Conduct is the way we act. It forms the basis for our ethical, environmental and social responsibility. The tone from the top is clearly communicated and all employees must take an e-learning in business ethics.

Anti-corruption compliance in business is important. SSAB has implemented clear instructions for our employees in order to guide us through our daily operations and how we act in relation to business partners. These instructions will help our people to stay on sound ethical and legal ground when doing business. SSAB has implemented a whistle-blower system called the Ethics Line. Employees can file a report anonymously online or by calling a global hotline 24 hours a day, seven days a week.

Inclusion & diversity

3.7 Lost Time Injury Frequency in 2020

The HYBRIT pilot plant for fossil-free iron production started operation in 2020 in Luleå.

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Sustainability targets beyond 2020

First in fossil-free steel

P	18 ACTIC

Target	KPI	2020	Target 2021	Target 2022	Target 2026	Target 2030	Target 2040	Target 2045
Lower energy consumption/ Higher productivity for customers	Mtonne customer CO2 savings 1)	8.9	10
First in fossil-free steel	Fossil-free steel milestones	Pilot plant opened		Iowa operations in US powered 100% by renewable electricity	Fossil-free steel to customers, delivered on commercial terms	Raahe conversion starting	Luleå conversion starting	SSAB fossil-free

1) The 2020 target has been pushed back to 2021 due to the Covid-19 impacts. New target from 2022 onwards will be set during 2021.

Lower energy consumption/higher productivity for customers

The SSAB EcoUpgraded concept highlights the environmental benefits of upgrading to highstrength steel, including reduced emissions from lower weight, improved fuel economy and extended product lifetime, but also from SSAB customers using less steel, when upgrading to high-strength steels. SSAB has set an objective related to customers upgrading to high-strength steels; SSAB is aiming at 10 million tonnes in annual customer CO2 savings by 2021 (earlier the target year was 2020, but it was pushed back due to Covid-19 impacts). The savings will be reached by two initiatives: 8.0 million tonnes savings from SSAB EcoUpgraded deliveries and 2.0 million tonnes savings from Automotive Premium Upgrade deliveries.

First in fossil-free steel

SSAB is undertaking a strategic roadmap to revolutionize steelmaking, and to be the world's

SSAB ANNUAL REPORT 2020

first steel company to deliver, in 2026, fossilfree steel to the market. This includes an active leadership role in the HYBRIT joint venture initiative with LKAB and Vattenfall. The target is to be fossil free as a company by 2045. Various milestones for SSAB and HYBRIT are outlined as targets for the coming years.

Use of scrap/Fossil-free direct reduced iron

timetable for the HYBRIT initiative.

and Scope 2) and is in line with the objective of keeping global warming well below 2°C. Other indirect CO2e emissions (Scope 3) are not included. The target goes hand in hand with our overall roadmap for fossil-free steel and the

For SSAB in the Nordics, a transformation from the traditional blast furnace-based production route to the use of electric arc furnaces is under way.

This will use scrap metal and also increasingly use fossil-free direct reduced iron (H-DRI). There is a strong focus on the recycled content on today's market and so also for steel products. However, over time fossil-free H-DRI will have the potential to replace recycled content for steel and tH-DRI will contribute to even lower Global Warming Potential results in a lifecycle assessment (LCA). Therefore, it is relevant to include both the use of scrap and H-DRI when setting the target and following up progress on this issue.

Slag utilization

Recirculating materials back into the steelmaking process reduces the need for virgin raw materials. Material that cannot be recirculated internally can be processed into by-products and sold externally, creating new revenue streams for the company. By-products such as blast furnace slag are used as input material in a number of industries, for example in road construction and as a substitute for cement.

Resource efficient operations

Greenhouse gas emissions reduction

also stored slag volumes are expected to be used. The target follow-up will be done first time for 2021.

Greenhouse gas emissions reduction / Science

SSAB's targets for greenhouse gas emissions including carbon dioxide have been approved by the Science Based Targets initiative. This means that the objective is scientifically based and in line with the Paris Agreement. SSAB is committed to reducing its greenhouse gas emissions by 35% by 2032 (based on 2018 figures and measured as CO2e). The goal applies to both direct and indirect emissions (Scope 1

Targets KPI

Leading sustainability performance

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Based Target

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Leading sustainability performance

Targets	KPI	2020	Target 2021	Target 2023	Target 2025
Eliminate fatalities	Number of fatalities	0	0	0	0
and serious incidents	Number of serious incidents	368	188	144	115
	LTIF	3.7	3.4	2.0	<1.5
Reduce injuries and their severity	TRIF	9.7	9.2	6.2	<5.0
	LTI severity rate	17.1	16	14	10
Eliminate major process safety incidents	Number of major process safety incidents	31	22	20	18
Safety leadership	Number of safety rounds	32,425	52,800	59,900	68,600
	Number of risk observations	23,532	25,900	30,100	35,300
	Number of near misses prevented	10,957	12,800	15,000	17,400

All other KPIs include contractors, except the Number of serious incidents and LTI severity rate

TRIF = Total Recordable Injury Frequency. Recordable injury means the sum of reported lost time injuries, medical treatment injuries and alternate duty cases

LTI severity rate = The number of absence days as R12 months cumulative

Responsible sourcing

Targets	KPI	2020	Target 2021	Target 2025	Target 2030	Target 2045
Sustainable supplier base	Share of new suppliers sustainability assessed (GRI 414-1)	93%	100%	100%	100%	100%
	Share of total spend sustainability assessed (categorized/identified and self-assessment done)	96%	96%	98%	100%	100%
	Number of second (third) party sustainability audits and on-site visits including social and environmental performance of suppliers 1)	19	37	--	--	--
	Share of high-risk raw material suppliers sustainability audited 2)	--		90%	100%	100%
Reduced CO2e footprint from the supply chain	Reduced Scope 3 CO2e emissions from the supply chain				Targets to be defined

1) Previously reported separately. Target 2021 is 7 second (third) party audits and 30 on-site visits

2) Based on Verisk Maplecroft´s risk indices for human rights, political and environmental risks and Transparency International´s Corruption Perceptions index

Sustainable supplier base

To support the responsible sourcing, a number of KPIs have been set to track progress related to sustainability assessment and sustainability related audits performed.

Reduced CO2e footprint from the supply chain

With this KPI SSAB aims at promoting and following up suppliers reduction of CO2 emissions. Target levels are to be defined.

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Leading sustainability performance

Zero tolerance for bribery and corruption

Targets	KPI	2020	Target 2021	Target 2025	Target 2030	Target 2045
Ensure ethical conduct in line with SSAB´s corporate culture and increase knowledge about the Code of Conduct and Ethics Line	All employees have completed the e-learning in business ethics; including training on our Code of Conduct	91%	95%	100% 1)	100% 1)	100% 1)
	Share of new employees covered by the on-boarding process; including signing the Code of Conduct statement and e-learning in business ethics	75%	80%	100% 1)	100% 1)	100% 1)
	Share of employees who have access to the Ethics Line 2)	95%	95%	95%	95%	95%

1) Because of employee turnover, 100 % may in practice never be reached

2) Employees that do not have access to the Ethics Line have other local reporting channels

Ensure ethical conduct in line with SSAB´s corporate culture and increase knowledge about the Code of Conduct and Ethics Line

This target has been broken down into several KPIs in order to measure progress:

Share of employees who have completed global e-learning in business ethics
Share of new employees covered by the onboarding process; including signing the Code of Conduct statement and e-learning in business ethics
Share of employees who have access to the Ethics Line. SSAB has implemented a whistleblower system called the Ethics Line. Employees can file a report anonymously online or by calling a global hotline 24 hours a day, seven days a week. The Ethics Line has been implemented in 14 countries and in 9 language versions. Use of the Ethics Line is completely voluntary.

Inclusion & Diversity

Targets	KPI	2020	Target 2022	Target 2025	Target 2030
Inclusion & Diversity	Women in top management positions, %	29	32	35	37

Inclusion & Diversity

SSAB offers equal opportunities to our workforce regardless of age, gender, ethnicity, physical abilities, political and religious beliefs, and other attributes. In a male dominant sector, the share of women, especially in top management positions, is however, a good role model of how diversity can be increased. In increasing the share of women in top

management positions, we work toward having a better bench strength by different initiatives at all levels, starting with employer branding activities aiming to support girls to select areas in schools which can lead to technical careers, finding female candidates to positions in all levels and putting extra effort in finding qualified candidates, both female and male, into leadership positions.

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

17 18 19 20

Sustainability targets ending 2020

Objectives/targets	Outcome in 2020	Historic target fulfillment
• 10 Mtonne annual customer CO2 savings 2021 1): - 8 Mtonnes of annual CO2 savings from SSAB EcoUpgraded deliveries by 2020 - 2 Mtonnes of annual CO2 savings from Automotive Premium deliveries by 2020	• In 2020, the customer end-product CO2 savings totaled 8.9 Mtonnes: - 7.4 Mtonnes from SSAB EcoUpgraded deliveries - 1.5 Mtonne from Automotive Premium deliveries	Customer CO2 savings during end-products' use-phase Million tonnes Target 2021 10 8 6 4 2 0 18 19 20 21 SSAB EcoUpgraded deliveries Automotive Premium deliveries
• Fossil-free operations by 2045 • In 2020: - Lasting reduction of 300,000 tonnes in CO2 emissions (Scope 1) - Lasting reduction of 400 GWh in purchased energy - Lasting improvement of 50,000 tonnes in residuals utilization (Base year 2014)	• The HYBRIT pilot plant started operation on August 31, 2020 at the SSAB site in Luleå, Sweden. Read more on page 63 • By the end of 2020, SSAB achieved: - 310,000 tonnes or 103% of the CO2 emissions reduction target of 300,000 tonnes, - 483 GWh or 121% of the purchased energy reduction target of 400 GWh - 62,000 tonnes or 124% of the residuals	Lasting reduction in CO2 emissions Tonnes Target 2020 350,000 300,000 250,000 200,000 150,000 100,000 50,000 17 18 19 20 0 Lasting improvement	Lasting reduction of purchased energy GWh Target 2020 500 400 300 200 100 17 18 19 20 0
		in residuals utilization Tonnes Target 2020 70,000 60,000 50,000 40,000 30,000 20,000 10,000

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

• World's safest steel company • Zero accidents • SSAB's lost time injury frequency resulting in an absence of at least one day (LTIF) was 3.7 (4.2), which meant a clear improvement, as LTIF decreased 12% from 2019. The positive trend in safety performance is a result of systematic and consistent work across the organization. ²⁰ 15 10 5 0 18 19 20 Injury frequency Lost time injury frequency (LTIF) Total recordable injury frequency (TRIF) Ensure supplier compliance with SSAB's Supplier Sustainability Policy: • Share of total spend sustainability assessed at 93% in 2019 and 95% in 2020 • Share of new suppliers sustainability assessed at 100% in 2019 and 2020 2) • Site visits including social and environmental performance of suppliers: 20 in 2019 and 24 in 2020 • Number of third-party sustainability audits: 5 in 2019 and 3 in 2020 In 2020: • 96% of total spend sustainability assessed • 93% of new suppliers sustainability assessed • 16 site visits to suppliers 3) • 3 third party sustainability audits 3)

1) The 2020 target has been pushed back to 2021 due to the Covid-19 impacts. Customer CO2 savings are calculated by looking at SSAB shipments of high-strength steels to different customer segments and applications. The amount of steel that SSAB supplies above standard practice in the respective industry is calculated for each application (e.g. a truck). This allows determination of the weight saving achieved in the end product by using these higher-strength steels. The resulting fuel savings are estimated by using typical values for fuel consumption, driving distance, useful life, etc. Finally, the CO2 emissions saved are then calculated based on these fuel savings

2) New suppliers with spend above 1 MSEK included

3) Of which 13 were performed remotely

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

SSAB and the value chain

The illustration shows the extent of our influence on the material impacts along the main stages of our value chain and provides examples of how we manage these impacts and create positive outcomes and value

Sourcing	Production / Operations			Transportation
The raw materials used to make iron and steel account for SSAB's most significant purchases. At SSAB, sustainability is an integrated aspect of sourcing operations and supply chain management, and suppliers shall comply with SSAB's Supplier	Operational efficiency, flexibility, environmentally-sound production. DEGREE OF INFLUENCE: HIGH	technology and a safe work environment are at the core of SSAB's	SSAB's business is dependent on efficient transportation throughout all the stages of the value chain, both upstream and downstream, and even within SSAB. Transportation takes place primarily by rail and ship, but also by truck. SSAB focuses on minimizing our environmental footprint through timely transportation and environmentally friendly fuels. Whenever
Sustainability Policy. DEGREE OF INFLUENCE: MEDIUM	IMPACTS / TOPICS IN FOCUS • Safety • Steel production emissions and waste • Use of raw materials and energy	MANAGEMENT OF IMPACTS • Strong focus on health and safety to minimize the risks of accidents • Promoting a high-performing organization	possible, SSAB seeks to transport by sea and rail rather than by road. DEGREE OF INFLUENCE: MEDIUM-HIGH
IMPACTS / TOPICS IN FOCUS • Safety • Labor and human rights issues at suppliers • Environmental impacts from raw material extraction VALUE CREATED / POSITIVE OUTCOMES • Payments to suppliers and contractors on time • Improved sustainability conditions at suppliers MANAGEMENT OF IMPACTS • Responsible sourcing practices Read more on p. 81.	VALUE CREATED / POSITIVE OUTCOMES • A safer and healthier work environment for SSAB's employees and contractors • Employee wages and benefits • More efficient use of natural resources and reduced CO2 emissions by utilizing residuals and recycled steel as raw materials • Improved energy efficiency through energy recovery and systematic energy management • Contribution to climate change mitigation and future fossil-free steel production through the HYBRIT initiative • Creation of employment and wellbeing at our production sites	• Working toward having a more diverse workforce and becoming a more attractive employer • Reducing CO2 emissions by more efficient use of materials • Improving energy efficiency through systematic energy management • Working toward fossil-free steel production Read more on p. 67 and 71.	IMPACTS / TOPICS IN FOCUS • CO2 emissions generated during the transportation of our raw materials and products • Other emissions to air and water • Use of fossil fuels • Social, labor issues, health and safety at our logistics partners VALUE CREATED / POSITIVE OUTCOMES • More accurate, cost-efficient and sustainable transportation	MANAGEMENT OF IMPACTS • Improving transportation efficiency and fuel economy by optimizing logistics, modes of transportation, transportation routes and load carrier capacities • Taking consideration of environmental and social criteria when selecting logistics providers • Active dialog with appropriate authorities about transportation regulations • Working toward our long-term goal of fossil-free internal transportation by gradually renewing the vehicle fleet to fossil-free vehicles

FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Use phase

Use of SSAB's high-strength steels enables customers to manufacture products which use less material, are stronger, lighter and more durable, and reduce costs, thus making customers and their products more sustainable and competitive.

DEGREE OF INFLUENCE: MEDIUM

IMPACTS / TOPICS IN FOCUS

Energy consumption and CO2 emissions during the use phase of moving equipment such as trailers, trucks, materials handling and lifting equipment
Energy consumption of buildings

VALUE CREATED / POSITIVE OUTCOMES

Reduced environmental impact through higher penetration rate of high-strength steels globally; end products made from less raw materials, with lower weight and fuel consumption, increased load capacity and longer lifespans, all leading to reduced CO2 emissions in the use phase
Improved energy efficiency in buildings
Satisfied, more competitive customers

MANAGEMENT OF IMPACTS

Fostering close collaboration with customers to increase the use of high-strength and wear resistant steels
Marketing our products with sustainability benefits (SSAB's branded products, SSAB EcoUpgraded, EcoSmart, Ruukki Construction)
Offering customers technical support and after-market services
Bringing understanding of customer needs to the R&D process and continuously developing new products, applications to enhance our sustainable offerings
Providing wear parts and steel for wear parts to prolong the life of machinery and equipment

End-of-Life

Steel is a unique material that retains its properties no matter how many times it's recycled. Using recycled steel in steel production increases material efficiency and reduces CO2 emissions.

DEGREE OF INFLUENCE: MEDIUM

IMPACTS / TOPICS IN FOCUS

Recyclability of steel
Waste from steel products at the end of life

VALUE CREATED / POSITIVE OUTCOMES

The use of steel scrap reduces the use of virgin raw materials and CO2 emissions in the steel life cycle
Minimized waste from steel products at the end of life

MANAGEMENT OF IMPACTS

Improving material efficiency through the use of recycled steel scrap to replace natural resources in steel production
Communicating and marketing steel as a recyclable, sustainable material choice
Promoting the recycling of steel products

First in fossil-free steel

SSAB's high-strength steels help our customers to produce lighter and stronger products, thereby reducing their environmental footprint. SSAB's customers can also reduce their carbon footprint by using steel produced in SSAB's blast furnace-based production, which is among the most CO2 efficient in the world. Furthermore, with HYBRIT technology, SSAB aims to be the first to offer fossil-free steel to the market in 2026, and to be fossil free as a company by 2045.

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Use better steel: SSAB's customers benefit from leading CO2 efficient production

At SSAB, steelmaking processes have been continuously advanced and improved. As a result, SSAB's blast furnaces today are among the most CO2 efficient in the world in terms of minimizing emissions from steel production. This gives a competitive advantage to SSAB and its customers.

SSAB focuses on continuous improvement to minimize emissions and improve productivity, as well as material and energy efficiency. SSAB's blast furnace-based production is among the most CO2 efficient in the world owing to the use of high-grade iron-ore pellet and, high-quality coke, as well as efficient and uninterrupted processes. This gives a competitive advantage to SSAB and its customers. For example, our cold-rolled steel production emits approximately 6% less CO2e than the European average and as much as 17% less than the Chinese average (see the chart).

In the US, our scrap-based EAF steel mills use close to 100% recycled steel as a raw material, thereby resulting in much lower direct CO2 emissions compared to blast furnace-based steel making. The possibilities to further reduce CO2 emissions from current steelmaking processes are limited, but emissions can be controlled and to some extent further reduced by continuously striving to improve material and energy efficiency.

Read more about SSAB and CO2 emissions on p. 71

SUSTAINABILITY APPROACH LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

Environmental Product Declarations

validate sustainable production EPD stands for Environmental Product Declaration, which is an independently verified document that provides transparent, comparable information about the environmental impact of products from the lifecycle perspective. SSAB EPDs comply with international standards, which provides objective data highlighting the

low carbon footprint of SSAB products. This is also a good tool for SSAB customers wanting to minimize their environmental impact. EPDs report values from the entire product lifecycle. This means that emissions from suppliers are included as well as all energy used in manufacturing the product. EPDs are available for all SSAB products and are registered in the International EPD® system.

EcoSmart: SSAB Americas' customer awareness program

The EcoSmart™ program, first launched in 2016, is SSAB Americas' innovative customer awareness program designed to showcase the organization's commitment to sustainability. The EcoSmart program emphasizes both the key product and process attributes of steel produced by SSAB Americas. More than 50 customer companies are part of the EcoSmart program, with more to come in 2021 and beyond. Here are some key points related to SSAB Americas' products and production process:

SSAB Americas' products

SSAB Americas' steel is 100% recyclable and is made from 97% recycled materials
The durability and high strength of SSAB Americas' steel adds years to the lifecycle of products

SSAB Americas' production process

• SSAB Americas uses recovered scrap tires as a raw material substitute for carbon in its production process – more than 400,000 tires a year—more than 7.1 million scrap tires to date

SSAB's mill in Iowa is expected to be powered completely by renewable energy by 2022
SSAB Americas' production process results in 62% fewer CO2 emissions compared to the 2018 US steel industry average
Since 2010, SSAB Americas has reduced its energy consumption by nearly 20%
SSAB Americas recycles millions of gallons of water every year for water conservation

SSAB.COM

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Use steel better: Environmental benefits with SSAB's steels

SSAB offers customers a broad range of high-strength and wear-resistant steels. Strenx performance steel, Docol automotive steel and Hardox wear plate enable better energy and material efficiency, safety, as well as strength and durability for the applications in which they are used. Our GreenCoat color-coated steels are unique in using a substantial amount of Swedish rapeseed oil instead of fossil-based oils in the paint. GreenCoat products are the sustainable choice for color-coated steels on the market for roofs, façades and rainwater systems.

Strenx performance steel reduces weight, increases payload, and lowers fuel consumption and CO2 emissions

The environmental advantages of using high-strength steels are significant in heavy equipment such as trailers, trucks, agriculture and lifting equipment, and construction machinery. Used in these applications, Strenx performance steel reduces their weight by enabling minimum steel thickness through new structural designs. Structural redesign can also reduce production costs through less welding and improved usability. In lifting equipment, which requires high load-bearing capacity, the structural wall thickness can be reduced, resulting in material weight savings and reduced emissions. In earthmoving and transport vehicles, lower vehicle weight leads to increased payload capacity, and lower fuel consumption and CO2 emissions. For example, the weight of trailer chassis made with SSAB's high-strength steels can be reduced by up to 30% compared to using lower-strength steel grades.

CASE: FINNISH CRANE MANUFACTURER ACHIEVES BOTH WEIGHT AND ENVIRONMENTAL SAVINGS

Besides providing substantial weight reductions in heavy industrial vehicles and equipment, Strenx also helps commercial vehicle manufacturers cut their products' weight. Finnish manufacturer Haulerman successfully used Strenx in a high strength-to-weight ratio of 700 MPa instead of a thicker, heavier grade of steel to lightweight the cranes it uses in its loading vans.

A commercial van crane must be light so that it can carry as much load as possible. Still, it must be safe and meet all the standards for

loading cranes. Haulerman can now offer an innovative, versatile way to load goods, turning an ordinary commercial vehicle into a mobile crane that can load objects up to 300 kg (611 lbs.). Haulerman achieved an impressive 33% weight reduction in boom profiles.

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CASE: HARDOX 500 TUF WEAR STEEL LIGHTENS EVERY LOAD FOR DUMP TRUCK BODY MANUFACTURER IWS

Industrial Welding Supply is a leading Colorado truck and trailer supplier featuring dump truck bodies and trucks built-to-order for a growing US market. As an early adopter of SSAB's new wear-resistant steel grade Hardox 500 Tuf, IWS will transition all its Hardox In My Body certified products to the new material, giving customers lighter vehicles with higher payloads, safer operation and an even longer service life. "As soon as my customers hear the benefits of Hardox 500 Tuf, they don't want it as an option, they want it as standard. The weight savings alone grab their attention, and then there's the longer service life," says JD Stone, IWS Vice President and General Manager. SSAB.COM

Prolonged service life, higher payload and lower fuel consumption of machinery and equipment thanks to Hardox wear plate

SSAB's premier abrasion-resistant steel, marketed under the brand name Hardox wear plate, is used in a range of machinery and equipment in transportation, mining, construction, quarrying, waste and recycling and road building. All of these applications require a hardness and toughness that are guaranteed to be met by Hardox wear plate.

Using Hardox wear steel in tipper bodies for mining, construction and many other industries subject to wear, buckets, crushers, cutting edges and shredders, provides greater wear resistance thereby improving machinery performance and extends service life. Additionally, lighter weight equipment offers cost benefits to end-users in fuel savings or the possibility of transporting a higher payload, and reduces the environmental impact over the machinery's lifecycle. SSAB's latest introduction to our Hardox product range is Hardox 500 Tuf, the new generation wear plate for tipper bodies, buckets and containers delivering extreme hardness and toughness and Hardox HiAce, the new abrasion-resistant steel that fights wear in acidic corrosive environments.

Docol makes cars safer and more eco-friendly

Automotive manufacturers are calling for lightweight, durable materials with beneficial environmental properties that are manufactured with resource efficiency. New safety regulations, emissions caps and a shift to electrical vehicles are all trends that increase the demand for advanced high-strength steels (AHSS) in the automotive industry.

SSAB EcoUpgraded The SSAB EcoUpgraded

concept highlights the environmental benefits of upgrading to highstrength steel. SSAB EcoUpgraded saves CO2 in steel production, but above all during the full lifetime of the machine, as the reduced weight from using high-strength steels also

increases cargo capacity and reduces fuel consumption. With the EcoUpgraded app you can also calculate the associated financial savings and increased profit.

SSAB.COM

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SSAB's Docol AHSS steels make it possible to develop safer and lighter cars with lower emissions. Docol AHSS have been especially engineered for safety applications in cars with stringent requirements for reduced weight and high energy absorption. When comparing AHSS with other lightweight materials, aluminum, carbon fiber reinforced plastics and magnesium, steel has clearly lower CO2 emission in the production phase. Also, the 100% recyclability of steel is an important attribute for the automotive industry, as some regions of the world are beginning to require 95% of the materials used in a car should be recyclable.

We are constantly pushing performance boundaries with our new products. SSAB's latest introduction for the automotive industry is Docol HE, a new range of hot-rolled advanced highstrength steel (AHSS) with improved edge ductility for automotive manufacturers facing technical challenges in production. Developed for the most demanding applications and manufacturing conditions in the automotive industry, Docol HE steel provides improved properties for customers facing design and production challenges with conventional HSLA material.

Sustainable and long-lasting buildings made from GreenCoat color-coated steels

GreenCoat is SSAB's brand for innovative and sustainable color-coated steels for the building industry. GreenCoat products feature a bio-based coating using a substantial portion of Swedish rapeseed oil instead of fossil-based oils. This patented solution reduces the environmental

CASE: SSAB ECOUPGRADED: LESS STEEL – MORE PAYLOAD IN A MINING TRUCK BODY

This heavy-duty mining truck has been equipped with an upgraded body manufactured from Hardox 500 Tuf, Hardox 450 and Strenx 700, and designed without the need for wear liners or ongoing maintenance. The weight of the new dump body is reduced by 18.5 tonnes, increasing

the maximum payload and offering improved productivity, while maintaining the same maximum vehicle weight. In addition to this, the lifetime of the body is now 50% longer than the original, decreasing overall steel consumption and reducing the need for expensive liner replacement and overhauls.

The weight reduction gives a fuel saving of to a 300,000 liters of diesel fuel over the four-year lifetime of the dump body, with a CO2 saving of over 1,100 tonnes.

CASE: SUSTAINABLE FISKSÄTRA BY SANDELLSANDBERG ARKITEKTER HIGHLY AWARDED

Sandellsandberg arkitekter chose GreenCoat®color-coated steel for the Fisksätra community center South of Stockholm specifically for its sustainability, wide color range as well as strong resistance to corrosion, UV radiation and scratches, which will help to ensure a building that lasts for many generations. Lately, Fisksätra has received numerous architectural awards, both international and national.

SSAB.COM

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footprint of GreenCoat products – for greener living. With its bio-based coating, full recyclability, compliance with REACH regulations and environmental certifications and numerous international architectural awards, GreenCoat stands at the forefront of sustainable building solutions.

Ruukki Construction for sustainable building products and services

SSAB's subsidiary, Ruukki Construction, works to make steel-based building products best in every aspect, including sustainability. Ruukki Construction's sustainability promise is towards carbon-neutral building products. We can have the greatest impact on carbon emissions through our offering and through reductions in our operations.

In 2026, Ruukki Construction aims to be first to offer products for walls and roofs made from SSAB's fossil-free steel. For these products, total carbon emissions will be reduced by around 90%. With our high-quality products, with guarantees of up to 50 years and our airtight building envelopes, we reduce our customer's carbon emissions further. Ruukki products help customers to achieve high ratings in environmental certification systems, such as LEED and BREEAM. These have been created to advance environmentally responsible buildings. Steel is also 100% recyclable.

Strenx® performance steel Hardox® wear plate Docol® automotive steel GreenCoat® colorful steel

In our own operations, we reduce waste, plastics usage and increase the usage of fossil-free energy. We also optimize our logistics by being close to customers and by maximizing truckloads. We work to have the industry's most satisfied customers. To differentiate through customer experience is a key driver for Ruukki Construction and thus, we aim to exceed customer expectations.

Go fossil-free: SSAB to be the first in fossil-free steel with HYBRIT technology

HYBRIT is a new revolutionary steelmaking technology. With HYBRIT technology, SSAB aims to be the first steel company in the world to bring fossil-free steel to the market already in 2026. SSAB will be fossil free by 2045. Together with our partners and customers, SSAB aims to create a fossil-free value chain, from the mine to the end-product.

Why HYBRIT?

The steel industry is one of the highest CO2 emitting industries, accounting for 7% of CO2 emissions globally. A growing global population, an increasingly higher standard of living and greater urbanization will trigger a rise in global steel demand. Recycled scrap will not sufficiently meet the growing demand for new steel, and steel still needs to be produced also by using iron ore-based production. The carbon footprint in the steel industry is thus a challenge for Europe and the rest of the world. To align with a transition to a low-carbon economy, the steel industry will require a step-change in emissions reductions through alternative steelmaking processes.

Therefore, in 2016, SSAB, LKAB (Europe's largest iron ore producer) and Vattenfall (one of Europe's largest energy companies) joined forces to create HYBRIT – an initiative that endeavors to revolutionize steelmaking. Using HYBRIT (Hydrogen Breakthrough Ironmaking Technology) technology, SSAB aims to replace coking coal, traditionally needed for ore-based steelmaking, with fossil-free electricity and

hydrogen. The result will be the world's first fossilfree steelmaking technology, with virtually no carbon footprint.

SSAB is already one of the world's most CO2 efficient steel companies. Yet, we want to do more. Sweden has unique conditions for this kind of project, with good access to fossil-free electricity, the highest-quality iron ore and a specialized, innovative steel industry. SSAB has also started to investigate the possibilities of broadening the initiative to include Finland.

The HYBRIT initiative will contribute to reaching the global climate goals under the Paris Agreement and the national climate goals in Sweden and Finland. SSAB shows leadership in contributing to the fulfilment of the Paris Agreement by having an approved Science Based Target.

Our goal is to reduce Sweden's CO2 emissions by 10% and Finland's by 7%. We believe that by taking the lead and showing that it is possible to decarbonize the steel industry, others will follow. The potential is enormous.

Fossil-free steel produced with HYBRIT technology

However, to succeed, we need to collaborate with many parts of society. We need collaboration with universities and research institutes, we need rapid permit processes, access to large amounts of electricity, a regulatory framework that supports

a future market for fossil-free products and we need financial support for the development and deployment of this breakthrough technology.

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Faster transition possible depending on customer demand

2016–2017	2018–2024	2025–2040	2045
PRE-FEASIBILITY STUDY	FEASIBILITY STUDY PILOT PLANT TRIALS	COMMERCIAL VOLUME PLANT TRIALS AND TRANSFORMATION	SSAB Fossil-free
2016 • Prefeasibility study with support from Swedish Energy Agency • 4-year R&D project with support from	FEB 2018 Decision for pilot phase 2019–2021 Fossil-free pellets trials	2025 • Transformation - BF to EAF at SSAB Oxelösund • HYBRIT demo plant
Swedish Energy Agency 2017 A joint venture company between SSAB, LKAB and Vattenfall	2020–2024 Hydrogen-based reduction and smelting trials 2021/22–2024 Hydrogen storage	2026 SSAB fossil-free steel on market 2030–2040 Transformation - BFs to EAFs at SSAB Raahe & SSAB Luleå	* BF = blast furnace EAF = Electric arc furnace

Timeline for HYBRIT and fossil-free steel

All SSAB production sites will be converted

SSAB will cut its CO2 emissions in Sweden by 25% by as early as 2025, through the conversion of the blast furnaces in Oxelösund, Sweden, to an electric arc furnace. Between 2030–2040, the plan is to convert the blast furnaces in Luleå, Sweden and Raahe, Finland to eliminate most of the remaining CO2 emissions.

The company anticipates that our Iowa operations will be fully powered by renewable energy by 2022. Our Americas operations will also be able to offer fossil-free steel products starting in 2026, utilizing the sponge iron developed using HYBRIT technology and produced in Sweden. At the same time, SSAB has started the process of phasing out fossil fuels used in rolling mills and heat treatment plants throughout the company, to reach the goal of becoming fossil free by 2045.

Pre-feasibility study

A pre-feasibility study, conducted in 2016–2017, concluded that fossil-free steel, given prices of electricity, coal and cost of CO2 emissions at

the time of the study, would be 20–30% more expensive. With declining prices in electricity from fossil-free sources and increasing costs of CO2 emissions through the European Union Emissions Trading System (ETS), the prefeasibility study also concluded that fossil-free steel will, in the future, be able to compete in the market with traditional steel.

Pilot phase

The HYBRIT pilot plant started operation on August 31, 2020 at the SSAB site in Luleå, Sweden. In the pilot plant, we will produce hydrogen by electrolyzing water and then use the hydrogen to

test the direct reduction of iron ore to make direct reduced iron (DRI), also called sponge iron. The sponge iron is then used as virgin material together with recycled scrap for steelmaking.

In the summer of 2019, construction started on a plant for fossil-free pellets at the LKAB site in Malmberget, Sweden. Here, fossil fuels will be replaced with biofuel to achieve fossil-free production of iron ore pellets. Trials using fossilfree fuels in LKAB's pellet plant have produced successful results during summer 2020. Fullscale tests are currently under way to replace fossil oil with bio-oil in one of LKAB's existing

SUSTAINABILITY APPROACH LEADING SUSTAINABILITY PERFORMANCE GRI REPORT SUPPLEMENT

pellet plants in Malmberget, reducing emissions from the operation by 40% during the test period, which will last until 2021.

A decision has been made to build a pilot hydrogen storage facility, 25–35 meters below the ground, on LKAB's land at Svartöberget, close to the HYBRIT pilot plant. The pilot storage facility is expected to operate from 2022 to 2024.

The total cost committed to the initiative during the pilot phase is estimated to be SEK 2 billion. The Swedish Energy Agency has committed to contribute SEK 600 million and the three owners, SSAB, LKAB and Vattenfall, will contribute the

Demonstration phase

The owners behind the HYBRIT initiative announced in 2020, that they will start efforts to prepare for the demonstration phase. The plan is to have a HYBRIT demonstration plant in place in 2025, at the same time as the conversion of SSAB's blast furnace site in Oxelösund in Sweden. This will enable SSAB to produce iron ore-based, fossil-free steel for commercial use in 2026. There is a growing interest from customers to lower the CO2 footprint in their value chain, which opens up great potential for fossil-free steel as a premium product. Consultations have begun for deciding on the location/site of the demonstration plant in Norrbotten, Sweden.

How is fossil-free steel produced?

Fossil-free steel is steel produced using HYBRIT technology using fossil-free hydrogen instead of coal and coke to reduce the oxygen in iron ore. This means the process will emit water instead of carbon dioxide.
Fossil-free steel is a premium product without a fossil CO2 footprint. This means no fossil CO2 emissions during production and that we use fossil-free sponge iron
Using fossil-free sponge iron as external input material, only internal scrap from fossilfree steel production, fossil-free electricity and no fossil fuels

LEARN MORE ABOUT HYBRIT

BUSINESS REVIEW

Leading sustainability performance

To be trustworthy in our low-CO2 steel and soon our fossil-free steel, we need to ensure our own sustainability performance. Safety is our number one responsibility, we will always do our utmost to make sure our colleagues and contractors work in a safe and healthy environment. Circularity is also a priority, making sure resources are used in the most efficient way. Our zero tolerance against corruption is a given.

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Safety first: Becoming the world's safest steel company

SSAB is determined to become the world's safest steel company, with the objective of achieving zero accidents, work-related injuries and illnesses. Everyone has the right to a healthy, accident-free work environment in SSAB. Our goal is to prevent all injuries and work-related illnesses. We will minimize health and safety risks everywhere we operate.

Safety at SSAB

Every SSAB employee has a personal responsibility to work safely every day; it is a fundamental requirement for working at SSAB. All SSAB employees are asked to sign SSAB's safety pledge, which is a commitment to always put safety first. Contractors and other partners working at our sites are required to follow the same high standard of safety regulations.

Safety is the most important part of how we operate, and it is integrated into our management system. Safety work at SSAB is guided by SSAB's Group governing documents on safety, which are mandatory for all divisions and companies within SSAB. The H&S principles included in the governing documents comply with or exceed all applicable laws, regulations and SSAB requirements. SSAB´s safety management system fulfills the requirements of international standard OHSAS 18001/ISO 45001 and is implemented at all SSAB sites.

Cooperation in health and safety across the Group is ensured by two cross-divisional safety groups. The Group-level Health and Safety Council (H&SC) has primary responsibility to coordinate, cooperate and propose policy recommendations and strategic initiatives to the Group Executive Committee (GEC). The H&SC is the decision-making body on operational safety issues relevant for SSAB. The H&SC is also responsible for promoting a positive safety culture within the company. The H&SC consists of senior representatives from all SSAB divisions, as well as subsidiaries Tibnor, Ruukki Construction and Merox.

The Safety Expert Group shares information on divisional safety programs, achieved results, best practices, information on serious incidents, and recommendations on preventive actions. The group also proposes company-wide safety initiatives to the Health and Safety Council.

Safety first

Becoming the world's safest steel company

PROCESS SAFETY MANAGEMENT OCCUPATIONAL SAFETY MANAGEMENT OCCUPATIONAL HEALTH MANAGEMENT SAFETY CULTURE AND LEADERSHIP

During 2020, we were challenged by a global pandemic that forced us to take unprecedented measures. Our absolute top priority in this regard was to keep our employees safe from Covid-19 and to ensure production stability.

-12% decrease in Lost Time Injury Frequency

-22% decrease in Total Recordable Injury Frequency in 2020

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

The line organization has the overall responsibility for managing and developing health and safety work and ensuring compliance with all applicable legal and other safety requirements. The line organization is also responsible for carrying out risk assessments, supported by safety organization and the employees of the evaluated areas.

SSAB applies occupational health and safety programs as required by local legislation in each of the countries where we operate. Safety programs are normally developed by occupational health and safety committees consisting of representatives of the local management and employees. In Sweden and Finland, SSAB has health and safety committees at all workplaces where more than 50 employees are working on a regular basis. In the US, SSAB has a variety of safety committees, which provide employees an opportunity to participate in worker health and safety issues.

All SSAB units and sites are required to create and maintain processes, procedures and necessary tools to identify systematically safety hazards arising from work, the working environment, machines and tools and working conditions, to regularly assess the risks arising from the identified hazards, to plan and carry out corrective and preventive actions to eliminate or minimize those risks and to maintain and update

Injury frequency

Total recordable injury frequency (TRIF)

the risk assessment data at all times. The five most common causes of serious safety incidents in the steel industry are: moving machinery, falling from height, falling objects, gas and asphyxiation, and moving cranes.

Risk assessments cover all existing, new and modified systems, processes and operations. The results of risk assessments must be widely communicated to all internal and external employees who may need the information. All risk assessments are documented. This documentation and all related data is maintained according to division/unit level procedures. Risk assessment documentation and data are available for review purposes at all times. Risk assessments are reviewed and updated when

necessary. The recommendation is to check risk assessments at least every 3 years and every time whenever changes have been made.

Work on process safety is an important part of preventive health and safety work. At SSAB, process safety is defined as a blend of engineering, operations and fatalities management skills focused on preventing

catastrophic accidents and near misses, particularly structural collapse, explosions, fires and toxic releases associated with loss of containment of energy or dangerous substances such as chemicals and petroleum products.

Every year, hundreds of employees from external companies work at SSAB, particularly in the areas of maintenance and repairs. Contractor companies

CASE: PROCESS SAFETY IS AN IMPORTANT PART OF OUR SAFETY

In 2020, the focus of safety work at SSAB Hämeenlinna was on process safety. Process safety is based on processes not causing a hazard to people or the environment at any stage. In addition, process safety protects employees and also includes protection of the environment, property and the surrounding community. A process that is as uninterrupted and well designed as possible reduces the risk of accident. At SSAB Hämeenlinna, our goal is to prevent process safety accidents such as explosion, fire and emissions of toxic substances. Because the site involves process safety risks, it is very important that everyone working at the site knows what a state of emergency is and how to act in one.

"For a few years now, we have been compiling all safety observations and near-miss

incidents related to process safety at SSAB Hämeenlinna to get an idea of the big picture. By monitoring deviations, we gain a better picture of the matters in process safety that we particularly need to address. Deviations in process safety are also monitored at the divisional level," says Tommi Nisula, Safety Manager at SSAB Hämeenlinna.

The most general types of accident at SSAB are injuries to fingers and eyes, and musculoskeletal injuries such as knee, ankle or back injuries. The commonest injuries sustained are wounds or other superficial injuries, sprains, strains, bone fractures or concussion.

Focus areas and key safety actions in 2020

The long-term work to improve safety continued throughout 2020 with many activities. In addition to continuous safety management procedures, the work includes the following:

New Group-level safety targets were defined and set as part of the new sustainability strategy
Preparation of a new two-week safety training program in SSAB Europe continued, but due to the Covid-19 pandemic, the program had to be postponed and several planned pilots were cancelled. The intention is to run the program in 2021. The objective of the program is to ensure a culture where safety and health are always prioritized
Development of more engaging safety communication to better engage our employees in safety work. Part of this entails increasing safety communication toward a more peoplecentric and human approach
Further strengthening cooperation and information sharing across the company
An even stronger focus on fully integrating safety work into the SSAB One management philosophy

are screened for strong safety practices. SSAB also provides contractors with safety training sessions and discussion forums in order to increase their safety awareness. All contractor accidents are included in SSAB's safety statistics.

The safety of our products has been ensured by adhering closely to all legal requirements relevant to our products. If any non-compliance should arise, corrective actions would be defined and executed, and customers affected by this non-conformity would be informed. No such cases occurred in 2020. SSAB also regularly informs customers regarding legislation like

RoHS, REACH and Conflict Minerals, about SSAB´s approach and actions to ensure compliance with the requirements. SSAB has also published Environmental Product Declarations for all its product categories with information about the chemical composition, lifecycle effects and safe use of the products.

SSAB's key performance indicator (KPI) for safety is lost time injury frequency (LTIF) and total recordable injury frequency (TRIF). All divisions have annual safety targets including both LTIF and TRIF, and report monthly on safety performance to the GEC.

Safety performance in 2020

SSAB's lost time injury frequency resulting in an absence of more than one day (LTIF) in 2020 was 3.7 (4.2), with a total of 101 (126) injuries among SSAB's employees and contractors. SSAB's own employees' LTIF was 3.2 (4.0) and for contractors it was 6.1 (12.7). In 2020, a total of 73 (102) injuries (LTIs) were incurred by SSAB's employees and 28 (24) by contractors. Overall, the development in safety was positive, particularly in SSAB Special Steels and Ruukki Construction. SSAB Europe was experiencing challenges and therefore started a special program in order to improve the situation, with good results as the number of accidents decreased strongly during the last part of the year.

Normal safety audits and hazard assessments continued to mitigate the risks of the main causes of serious incidents in the steel industry. Risks also will be reduced by further improving information sharing about serious incidents within the company.

Safety work is also being enhanced by aiming to improve incident data collection and tracking, as well as by utilizing a more systematic approach to analyzing the root causes of incidents.

Health

During 2020, SSAB implemented several measures to prevent the spread of Covid-19 and to safeguard the health of our employees and contractors. Examples of these measures include a ban on all business travel, employees working from home where possible, not allowing external visitors at sites and restricting face-to-face meetings. During pandemic, the company has paid extra attention in supporting managers in taking responsibility of their employees mental wellbeing and ergonomics when remote working. SSAB has contingency plans in place for all production sites and key functions. SSAB is monitoring the situation closely and is prepared to take additional actions where required.

SSAB focuses on health and wellness to promote the overall wellbeing of employees. Wellbeing is a joint responsibility between the employer and the employee facilitated by SSAB's framework for health:

Our Code of Conduct provides the framework for how we act and how we make our employees feel engaged and included
SSAB One, our management philosophy, allows us to improve, learn and achieve results that are built on everyone's skills and contribution
A leadership that is built upon our manager criteria, where the individual is recognized and feedback is essential
Regular employee surveys allow identification of both strengths and improvement areas, and provide a solid base for planned actions of improvement
Occupational healthcare services are provided to employees as required by the law and regulations in each operating country. At our major sites, occupational healthcare services are provided by professional service providers at SSAB's premises
Monitoring sick leaves and ascertaining the reasons for them. Sickness absence rates are continuously monitored and preventive actions are taken as needed by the line organization
Supporting a healthy lifestyle (exercise and other recreational activities). SSAB offers applicable recreational activities and health promotion services in different countries. These include e.g. support for physical exercise
The absentee rate at SSAB was 4.8% (2.3%) (employees in Sweden and Finland)

Disclosure 403-9: Work-related injuries

Contractors Fatal

until April 30, 2020.

High consequence

2020	2019	2018

101	126	184
3.7	4.2	6.1
9.7	12.4	15.6

0	0	0
9	7	7
368	445	465
73	102	153
3.2	4.0	5.9
9.7	12.4	12.4

		Worked hours 22,767,926 25,474,602 25,942,824

accidents 0 0 0

LTIs 4 0 3 Total LTIs 28 24 31 LTIF 7.7 5.6 7.2 Worked hours 3,654,969 4,319,125 4,329,246

The numbers include Ruukki Building Systems

LTIF by country/region (incl. employees and contractors)

	2020	2019	2018
Sweden	3.3	3.7	6.6
Finland	5.5	5.4	8.2
USA	1.9	2.7	1.4
Rest of Europe	3.2	3.2	5.4
Rest of the world	2.4	3.4	5.2

TRIF by country/region (employees)

	2020	2019	2018
Sweden	10.6	15.4	20.2
Finland	12.6	12.1	17.0
USA	4.0	8.2	8.0
Rest of Europe	5.4	6.6	5.9
Rest of the world	8.7	20.0	16.2

LTIF = Number of injuries resulting in an absence of more than one day per million working hours. Lost time injury (LTI) is any work-related injury, resulting in the employee not being able to return to work for the next calendar day TRIF = Total Recordable Injury Frequency per million working hours. Recordable injury means the sum of reported lost time injuries, medical treatment injuries and alternate duty cases.

Serious incident = incidents involving moving machinery, cranes, falling objects, working at heights, on-site traffic, electric shocks. Units may use their own definitions if they are a requirement from the local authority. LTI severity rate = The number of absence days divided by the number of LTI´s as R12 months cumulative High consequence LTI = Injuries from which the worker cannot recover (e.g., amputation of a limb), or does not or is not expected to recover fully to pre-injury health status within 6 months (e.g., fracture with complications)

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Resource efficient operations

SSAB is committed to minimizing any adverse environmental impacts from our operations. Therefore, SSAB focuses on continuous improvement to minimize emissions and improve productivity, as well as material and energy efficiency. SSAB is also working toward a fossil-free steelmaking process through the HYBRIT initiative, and by eliminating other fossil related emissions, with a goal to offering fossil-free steel in 2026 and fossil-free operations by 2045.

CO2 efficient steel production

At SSAB, steelmaking processes have been continuously advanced and improved. As a result, SSAB's blast furnaces today are among the most efficient in the world in terms of minimizing emissions from steel production. Still, SSAB's operations account for 10% of Sweden's and 7% of Finland's CO2 emissions. In the US, our scrapbased EAF steel mills use close to 100% recycled steel as a raw material, thereby resulting in much lower direct CO2 emissions compared to blast furnace-based steel making.

Direct CO2 emission reductions through further improvements in resource efficiency

Steel production is resource intensive and generates carbon dioxide (CO2) emissions. In 2020, SSAB's total direct CO2 emissions were 8,844 (9,582) thousand tonnes. Around 90% of SSAB's direct CO2 emissions are generated by iron ore-based steel production at our sites in Luleå, Oxelösund and Raahe, in particular our blast furnaces. Approximately 98% of these emissions are related to metallurgical processes, i.e., to the use of coke and coal as reducing agents. In 2020, direct CO2 emissions from Nordic steel production were 8,105 (8,873) thousand tonnes and emissions intensity (tonnes of CO2 emissions/ tonne crude steel) was 1.64 (1.75). CO2 emissions generated in Nordic steel production are within the scope of the European Emissions Trading System.

Our iron ore-based steel production in the Nordics is among the most CO2 efficient in the world owing to the use of high-grade iron-ore pellet and, high-quality coke, as well as efficient and uninterrupted processes. The possibilities to further reduce CO2 emissions from current steelmaking processes are limited, but emissions can be controlled and to some extent further reduced by continuously striving to improve material and energy efficiency (read more on p. 76 and 78). SSAB's target was to achieve

a lasting reduction of 300,000 tonnes in CO2 emissions (Scope 1) by the end of 2020, compared to the 2014 baseline. By the end of 2020, we achieved 310,000 tonnes or 103% of this target. We have taken several measures to reach the targeted reductions, such as the following:

Switching from heavy fuel oil to LNG in Borlänge
Increasing yield within the production of prime slabs in Luleå. This is based on an overall better yield improvement of prime slab production, improved raw material utilization for prime productions

In 2020, direct CO2 emissions from the scrapbased steel production in the US were 722 (697) thousand tonnes and emissions intensity (tonnes of CO2 emissions/ tonne crude steel) was 0.68 (0.68).

8.8 million tonnes of direct CO2 emissions in 2020

tonne of C02 / tonne crude steel in C02 intensity in 2020

Environmental targets for 2020 were overachieved and new targets were set for the coming years.

1.3

Carbon dioxide emissions

Indirect emissions from the generation of purchased electricity and heat (Scope 2)

Direct emissions from production (Scope 1)

CASE: ENERGY4HYBRIT BIOMATERIAL SIDESTREAM PREFEASIBILITY STUDY IN FINLAND

The Energy4HYBRIT prefeasibility study, part of SSAB's plan to be fossil free by 2045, was completed in December 2020. In this prefeasibility study, SSAB investigated the use of fossil-free energy sources, primarily biomaterial sidestreams, to replace fossil fuels in certain steelmaking processes, for example rolling processes. The prefeasibility study indicates that it would be possible to replace a significant amount of fossil fuel consumption with felling and other bio-based sidestream components at the Raahe mill. Ironmaking accounts for around 90% of SSAB's carbon dioxide emissions. The University of Oulu and VTT studied and modelled all energy flows at the mill as part of the prefeasibility study. The prefeasibility study was carried out by SSAB with Gasum, Neste and St1 and was supported by Business Finland. The energy companies were studying the use and availability of alternative energy sources. The Energy4HYBRIT prefeasibility study and the planned followup projects based on it will focus on the 10% of carbon dioxide emissions remaining after the reduction of iron ore, originating in numerous other steelmaking processes than ironmaking.

Indirect CO2 emissions

Indirect CO2 emissions (Scope 2) from energy occur from the generation of purchased electricity and heat. In 2020, SSAB's indirect CO2 emissions were 1,145 (1,173) thousand tonnes. Energy indirect CO2 emissions from the scrap-based steel production in US are larger than the direct CO2 emissions, because electricity is used to melt the scrap metal in the electric arc furnaces.

SSAB's other indirect (Scope 3) CO2 emissions in 2019 were an estimated 5.6 million tonnes (Scope 3 emissions are calculated every other reporting year, last measured in 2019). The majority of Scope 3 emissions are generated in the processing of sold products, which account for 40% of the total Scope 3 emissions. Of the other Scope 3 emissions, 38% are production of purchased raw materials and services, 7% are upstream emissions of purchased fuels and electricity (not included in Scope 1 and 2 emissions) and 9% are generated in the downstream transportation and distribution. The share of Scope 3 emissions of SSAB's total CO2 emissions was 34 % in 2019.

SSAB'S CLIMATE GOALS ARE APPROVED BY THE SCIENCE BASED TARGETS INITIATIVE

The approved science based target means that SSAB commits to reducing greenhouse gas emissions by 35 % by 2032 (compared to 2018 and measured as CO2 e). The target applies to both direct and indirect emissions (Scope 1 and 2) and is in line with the Paris Agreement and the objective of keeping global warming well below 2°C. We have set annual targets leading up to a 35% reduction. SSAB's overarching goal is to be fossil-free by 2045. Read more on p. 63.

About the Science Based Targets Initiative

The Science Based Targets initiative is an organization that encourages companies to set science-based goals that increase their competitiveness in the transition to a low-emission society. The organization is a collaboration between CDP, the UN Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF).

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

305-1, 305-2: Greenhouse gas emissions 1)

Thousand tonnes	2020	2019	2018	2017	2016
305-1: Direct greenhouse gas (GHG) emissions (Scope 1) 2)
Iron ore-based steel production in Nordics	8,105	8,873	9,005	9,156	9,323
Sweden	4,687	5,489	4,903	5,281	5,102
Finland	3,418	3,384	4,102	3,875	4,221
Scrap-based steel production in US	722	692	725	690	644
Other reported sites	17	17	19	21	22
Total	8,844	9,582	9,749	9,867	9,989
305-2: Indirect emissions from the generation of purchased electricity and heating (Scope 2) 3)
Iron ore-based steel production in Nordics	165	196	167	167	185
Sweden	100	132	107	100	112
Finland	64	64	60	67	73
Scrap-based steel production in US	968	964	1,007	1,032	964
Other reported sites	12	13	15	16	16
Total	1,145	1,173	1,189	1,216	1,165

¹ Only CO2 is included in the calculation. Biogenic CO2 emissions are not relevant for SSAB and therefore not included in reporting.

² Generation of electricity from process gases is included in the direct emissions (Scope 1). The direct CO2 emissions are calculated in accordance with the procedures in the WBCSD GHG Protocol, together with additional guidelines from the EU and/or national authorities. The Scope 1 emissions for the Nordics in 2020 are preliminary. EU-ETS verification of GHG emission reports may result in minor adjustments.

³ For electricity, indirect CO2 (Scope 2) emissions are calculated using grid average emission factors. Specific emission factors are used for the generation of the purchased heat.

305-4: Greenhouse gas emissions intensity

Tonnes of CO2 emissions/tonne crude steel	2020	2019	2018	2017	2016
Iron ore-based steel production in Nordics	1.64	1.75	1.67	1.68	1.68
Scrap-based steel production in US	0.68	0.68	0.68	0.71	0.69
Average	1.32	1.41	1.36	1.38	1.39

The GHG intensity is reported as product emission intensity (tonnes of CO2 emissions per tonne of crude steel produced). It is calculated as the sum of Scope 1 and Scope 2 emissions for all SSAB iron and steel production sites and rolling mills, divided by the total crude steel production in tonnes.

305-3: Other indirect (Scope 3) GHG emissions

		% of		% of
Thousand tonnes CO2e	2019	Scope 3	2018	Scope 3	2017
1. Purchased raw materials, goods and services	2,142	38 %	2,142	64 %	1,827
3. Fuel and energy related activities	370	7 %	370	11 %	395
4. Upstream transportation (inbound)	236	4 %	236	7 %	-
5. Waste generated in operations	43	1 %	43	1 %	51
6. Business travel	8	0 %	8	0 %	7
7. Employee commuting	36	1 %	36	1 %	36
9. Downstream transportation and distribution (outbound)	501	9 %	501	15 %	512
10. Processing of sold products	2,268	40 %	-	-	-
Total Scope 3 emissions	5,604	100 %	3,336	100 %	2,826

Scope 3 calculation was performed following the requirements of Greenhouse Gas Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard (WRI & WBSCD 2011). Greenhouse gas emissions are calculated as CO2 equivalents. Biogenic emissions are not included in the calculation.

In 2018 reporting, Category 4 "Upstream transportation" was included. Scope 3 emissions are calculated every other reporting year, last measured in 2018.

In 2019 reporting, Category 10 "Processing of sold products" was included. Scope 3 emissions are calculated every other reporting year, last measured in 2019.

The Scope 3 calculation principles can be found in the Scope 3 report on SSAB.COM

Climate risks

Transitional risks, emissions trading and increasing carbon costs

Transitional risks, such as regulatory changes (especially regulations related to EU Emissions Trading System (EU-ETS), have increased the need for more CO2 efficient production and increasingly influence investment decisions. The EU-ETS is the largest mandatory international system for trading greenhouse gas emission allowances, and a major element of the EU's efforts to combat global warming. The greenhouse gases emitted in SSAB's Nordic steel production are within the scope of the EU ETS, currently in the third trading period of 2013–2020. Compared to previous trading periods, both the cap on total annual emissions in the EU and the amount of free emission rights allocated to the industry are being gradually reduced. Due to the foreseen revision of the system, especially changes in the free allocation of emission allowances, and the fact that the market price for allowances could rise, there will be increasing costs for the steel industry due to the need to purchase additional emission allowances. SSAB is among the most efficient steel producers in Europe and also has a smaller deficit of emission rights than the industry average, hence the cost increase will be less pronounced.

The European Steel Association (EUROFER) has estimated that the European steel industry will see an average shortfall of 26% in free allocations during the period 2021–2030. This shortfall is likely to increase to around 37% by 2030. Using the same calculation method and based on current technology, SSAB's estimated shortfall will average 24% during the period and is likely to increase to 27% by 2030. Currently, SSAB has some saved allowances and has started to purchase ETS allowances to ensure a proper balance.

In addition to the direct costs, the steel industry is impacted by the indirect carbon costs passed on in electricity prices. The Finnish government has declared their willingness to compensate energy intensive industry for higher electricity costs by 37.5% in 2019 and 2020. No such statement has been made by the Swedish government.

Physical risks caused by climate change

SSAB's operations are, to some extent, exposed to physical risks caused by climate change, and these risks are part of the risk matrix, however currently not with high likelihood nor high financial impact on SSAB as a company on a short-medium perspective. Physical risks caused by climate change include rising temperatures, rising sea levels and increased severity of extreme weather events, such as hurricanes and flooding, especially near our American mills where plans for mitigating impact of hurricanes are reviewed regularly. For example, higher temperatures of

incoming water in rolling processes can lead to increased energy consumption due to the higher cooling water flow needed to obtain the same cooling capacity. Extreme weather can cause problems with transportation by rail or sea, which could lead to reduced revenue from decreased production and supply chain interruptions. Rising sea levels could cause instability in the foundations of buildings and facilities at sites that are directly connected to the sea, leading to increased capital expenditure.

In addition to climate change mitigation actions, we also aim to better adapt our operations to the changing climate and weather conditions, taking the physical climate change risks into consideration in new investments, process development and supply chain and production planning.

Other emissions to air

In addition to CO2, the most emissions generated are particulate matter (PM), sulfur oxides (SOx) and nitrogen oxides (NOx). Particulate emissions

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Particulate emissions

contain metals, which originate mainly from iron ore pellets, coking coal and from residuals and processing of the steel products. Sulfur oxide emissions originate from the raw materials and fuels containing sulfur. Nitrogen oxide emissions mainly are formed in the combustion processes in the coke plants and rolling mills. We monitor emissions arising from our operations both at production sites and in their vicinities to ensure compliance with emissions limits and to improve local air quality. The emissions are monitored in compliance with the requirements of the local environmental authorities at each site.

Nitrogen oxides emissions

305-7: Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions

Tonnes	2020	2019	2018	2017	2016
Particulate matter (PM)	505	596	623	705	711
Sulfur dioxide emissions (SOx)	2,549	3,242	2,306	2,809	2,347
Nitrogen oxides emissions (NOx)	3,253	3,308	3,323	3,805	3,672

LEADING SUSTAINABILITY PERFORMANCE

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT

Material efficiency and recycling

SSAB strives for resource efficiency. We recirculate much of the material generated from our production back into our own processes, thereby reducing the need for virgin raw materials, CO2 emissions and waste. The use of recycled steel in the production of new steel has a big impact on lowering the environmental footprint of the product's lifecycle.

Materials used in steelmaking

The key raw materials needed in steelmaking include iron ore, coal, limestone, alloys and scrap steel. Iron ore and coal are the main raw materials required for SSAB's steel production operations in Sweden and Finland. Scrap metal is the most important raw material for SSAB's steel production operations in the US. In 2020, SSAB used a total of 14.1 (14.6) million tonnes of raw materials.

Maximizing the recirculation of materials

The production of iron and steel gives rise to a range of residuals (e.g. slag, sludge and dust). Recirculating materials back into the steelmaking process reduces the need for virgin raw materials. This in turn reduces CO2 emissions and waste. Materials that cannot be recirculated internally can be processed into byproducts and sold externally, thereby reducing

301-1: Materials used by weight

Thousand tonnes	2020	2019	2018	2017	2016
Iron ore pellets	6,417	6,813	7,130	7,128	7,325
Scrap (external + internal)	3,689	3,658	3,803	3,852	3,644
Reducing agents 1)	2,309	2,525	2,526	2,582	2,562
Recycled materials	823	767	914	968	1,005
Slag formers 2)	661	699	756	728	765
Alloys	101	111	119	117	116
Metal and organic coatings	57	52	54	56	58
Non-renewable materials, total	14,057	14,626	15,303	15,431	15,476

1) Coke, coal and other reducing agents, such as oil

2) Limestone, burnt lime, dolomite, carbide, etc.

CO2 emissions by substituting natural resources in other industries. For example, blast furnace slag is used to replace cement, enabling the cement industry to significantly reduce their CO2 emissions. In 2020, 3.6 (3.3) million tonnes of residuals from the iron ore-based steel production were utilized, internally or externally. This is about 92% (90%) of all residuals produced in the iron ore-based production. In 2020, 1.4 (1.3) million tonnes of byproducts were sold externally.

One of SSAB's environmental targets was to achieve a lasting improvement in residual

Residuals from steel production, waste included

utilization by 50,000 tonnes, reducing the amount of material being sent to a landfill by the end of 2020, compared to the 2014 baseline. By the end of 2020, SSAB achieved 62,000 tonnes or 124% of this target. Examples of measures taken to reach the target are the following:

Utilization of blast furnace sludge and basic oxygen steelmaking (BOF) sludge in briquettes for use as a raw material instead of being landfilled in Luleå
Utilization of ladle slag in the blast furnaces in the Nordics

Scrap used in steel production

Recycled steel replaces the iron ore as input material in iron and steel-making increasing material efficiency and reducing CO2 emissions. In 2020, SSAB used 2.8 (2.7) million tonnes of external scrap and 0.9 (0.9) million tonnes of internally recycled scrap, which equals an average of 46% of recycled steel used in all of SSAB's steel production. SSAB uses approximately 20% of scrap metal in conjunction with steel production in the Nordics, and nearly 100% in the US.

Minimizing waste

SSAB focuses on reducing the volume of material sent to landfills. The key to waste reduction is the recirculation of materials described earlier. However, there are waste products from the production processes for which there is currently no environmentally or economically justifiable application and which therefore need to be removed from the processing cycle. Waste that originates from SSAB's operations and requires either being sent to la andfill or to an external waste recipient is processed in compliance with valid regulations. Focus is on hazardous waste, such as oily waste, including used oil, grease, sludge and emulsions, which are often disposed of through combustion. The management and monitoring of the company's landfill sites are strictly regulated by applicable laws and governmental authorities.

of all residuals from iron-based production utilized

million tonnes of by-products sold

92%

1.4

Residuals from ore-based steel production Residuals, total 3,897 3,648 3,659 4,054 4,045 Utilized internally or externally 3,578 3,300 3,271 3,836 3,648 Residuals from scrap-based steel production Residuals, total 762 719 696 756 718 Utilized internally or externally 685 644 626 689 659

306-2: Total weight of waste by type

Thousand tonnes	2020	2019	2018	2017	2016
Industrial waste to landfill	331	366	356	441	399
Hazardous waste	51	52	53	50	48
Non-hazardous waste	63	69	66	70	54

Thousand tonnes 2020 2019 2018 2017 2016

SSAB ANNUAL REPORT 2020

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Energy efficiency

SSAB's production processes are energy intensive. Systematic energy efficiency management and energy recovery at all sites, as well as production of electricity from process gases at steel mills, ensure efficient use of energy and lower emissions.

Continuous work to improve energy efficiency

Energy efficiency management is systematically promoted at all of our production sites, mainly as part of an ISO 14001 system.

SSAB's energy savings target is to reduce the use of purchased energy by 400 GWh by the end of 2020 (corresponding to ~5% of purchased energy in 2014, the base year). By the end of 2020, we achieved approximately 483 GWh or 121% of this target. During the target period, we have taken several measures to reach the targeted savings, such as the following:

A new, more efficient blast machine for the blast furnace in Luleå reduces electricity consumption
Optimized media systems for compressed air and hydraulics, as well as furnace control systems at several SSAB sites
Oxygen lancing in a reheating furnace in Borlänge
Replacement of old lighting fixtures with LED technology in Oxelösund, Luleå, Borlänge, Mobile and Montpelier
A new power plant with higher efficiency in Raahe

In 2020, SSAB's total energy consumption (including electricity, purchased fuels and purchased heat) was 9,083 (9,088) GWh and SSAB's energy intensity was 1,203 (1,188) kWh/ tonne crude steel (including electricity and purchased fuels). In 2020, SSAB's crude steel production was 7,535 (7,623) thousand tonnes. Also production stability impacts the efficiency of energy usage.

Energy sources – our long-term aim is to switch to fossil-free energy

The main fuels used at SSAB's production sites are process gases, natural gas, propane and, for the time being, heavy fuel oil. Process gases from SSAB's coke oven plants and blast furnaces are used primarily to replace external fuels in

Energy consumption GWh

1) Includes natural gas (NG), liquefied petroleum gas (LPG), oil and biogas. Coal and coke excluded

ovens and secondarily to produce electricity in power plants. Natural gas, propane and oil are used to heat up furnaces. Currently, SSAB does not consume renewable fuels in production processes, but as part of our long-term goal to become fossil-free in our operations by 2045, one important goal is to eliminate fuel-related emissions. This will be achieved through the electrification of processes and increased use of biofuels.

Today, electricity is our largest energy source, accounting for ~50% of the total energy consumption. At our US sites, electricity is

the most important energy source used in the electric arc furnaces to melt recycled steel. In line with SSAB's global ambitions, the company anticipates that our operations in Iowa, USA, which utilize scrap-based electric arc furnace technology, will be powered completely by renewable electricity by 2022 (primarily wind energy). SSAB in the US also will be able to offer fossil-free steel products starting in 2026, utilizing sponge iron developed through the HYBRIT initiative in Sweden.

Energy recovery at steel mills decreases CO2 emissions

To improve energy efficiency, energy flows are recycled in the production process (see the illustration). Process gases like blast furnace gas, coke oven gas and converter gas are generated in the iron- and steelmaking processes. Steam and hot water are also produced. These energy flows can be fully recovered to

generate electricity and heat, thereby saving fuel resources and decreasing CO2 emissions. Recovered heat has been used to produce district heating in Luleå, Oxelösund and Raahe since the 1980s, accounting for about 90% of local district heating needs. In 2020, 1,184 (1,056) GWh of electricity was produced from recovered energy and SSAB delivered 1,097 (1,165) GWh of district heating.

302-1: Energy consumption within the organization

GWh	2020	2019	2018	2017	2016
Fuels
Natural gas	3,708	3,361	3,211	3,101	3,073
Propane	684	818	1,174	1,171	1,099
Fuel oil	215	376	309	206	277
Total non-renewable fuels	4,607	4,554	4,694	4,478	4,450
Electricity, heat and steam
Electricity, purchased 1)	3,270	3,449	3,311	3,301	3,316
Heat, purchased	21	28	28	31	26
Electricity generated from process gases	1,184	1,056	1,418	1,400	1,195
Gross energy consumption	9,083	9,088	9,452	9,210	8,986
Electricity and heat sold
Heat, sold	1,097	1,165	1,173	1,169	1,101
Net total energy consumption 2)	7,985	7,923	8,279	8,041	7,885

Energy recovery at steel mill

Energy

Recovery of process

1) Including external companies within the industrial area

2) The figure excludes the fuels used in transportation and vehicles, nor does it include employee travel and transportation.

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Water recirculation in the production process

Access to water is crucial for steel production, particularly in quenching, where water is used for the direct cooling of hot-rolled steel. Most of the water used in SSAB's production processes is recirculated in cooling systems.

Surface water for cooling purposes

SSAB's operations are located in areas where there is currently no scarcity of water, and no water sources are significantly affected by water withdrawal by SSAB's operations.

SSAB uses surface water at all of its production sites, including both sea water and fresh water. Water is used mostly in processing, cooling and in scrubbing flue gases at the steel works and rolling mills. Water is also needed for electricity production and in slag granulation.

Effluent discharge into waterways

All of SSAB's sites take actions to prevent the risk of contaminating local water resources and to reduce effluent discharge into waterways. Discharges of effluent into the waterways consist of suspended solids, which contain calcium,

Water consumption Million m3

magnesium and silicon compounds, and originate from the steel plants and blast furnaces. Oily emissions originate from the rolling processes. There are also some discharges of nitrogen and iron into the waterways. All SSAB operations are subject to environmental permits and guidelines regarding discharged water.

303-1: Water withdrawal by source

Million m3	2020	2019	2018	2017	2016
Surface water (inlands)	180	180	206	203	203
Surface water (sea)	198	198	225	226	225
Municipal water	1	1	2	2	1
Total water withdrawal	379	379	433	431	429

Effluent discharge into waterways

Tonnes	2020	2019	2018	2017	2016
Suspended solids	76	196	230	322	286
Mineral oil	2	2	8	6	6

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Main flows of raw materials

Responsible sourcing

SSAB has approximately 20,000 active suppliers in more than 60 different countries. Suppliers must comply both with SSAB's standards and with international ethical, social and environmental guidelines in order to remain qualified suppliers for SSAB.

Efficient and responsible sourcing of goods and services

SSAB buys raw materials, products and services ranging from goods like scrap, iron ore, coal and alloys to gas, refractories, zinc, paint, maintenance services and spare parts. In 2020, SSAB sourced products, materials and services worth an estimated SEK 50 billion.

At SSAB, sustainability is an integrated aspect of sourcing operations and supply chain management. We assess suppliers based on quality, delivery performance, cost and sustainability.

Targets and results

Focus area	KPI	Target 2020	Result 2020
Ensure supplier compliance with SSAB's Supplier Sustainability Policy	Share of total spend sustainability assessed (categorized/ identified and self-assessment done)	95%	96%
	Share of new suppliers sustainability assessed (GRI 414-1) 1)	100%	93%
	Onsite visits including social and environmental performance of suppliers	24	16 2)
	Third-party sustainability audits	3	3 2)

Sustainability is incorporated in sourcing

SSAB has a Supplier Sustainability Policy based on the UN Global Compact principles to which SSAB is a signatory. The purpose of the policy is to ensure that SSAB collaborates with suppliers who share our sustainability values. The Supplier Sustainability Policy applies to all suppliers providing products and/or services to any SSAB Group company and includes requirements on labor and human rights, health and safety, anticorruption and the environment. Regarding the policy, SSAB also reserves the right to conduct reviews of our direct suppliers or onsite audits to ensure compliance with the policy. All new or updated contracts from 2017 and onward refer to the Supplier Sustainability Policy or similar, and the same reference is included in our purchase orders, for all main SSAB sites.

1) New suppliers with spend above SEK 1 million included

2) Of which 13 were performed remotely

Compliance Program

BUSINESS REVIEW

SUSTAINABILITY REPORT CORPORATE GOVERNANCE REPORT FINANCIAL REPORTS 2020

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Identification and evaluation of supplier risks

SSAB classifies first-tier suppliers and assesses potential risks. For sustainability assessments, we use Verisk Maplecroft´s risk indices for human rights, political and environmental risks per specific region. Corruption assessments are based on Transparency International´s Corruption Perceptions index.

Suppliers identified as medium- or high-risk suppliers must complete a self-assessment questionnaire containing questions about governance, social conditions and environmental performance. SSAB investigates and follows up on identified areas of non-compliance. In 2020, 96% (93%) of SSAB's total spend was sustainability assessed (classified/identified in terms of sustainability risks and self-assessment done) and 93% of new suppliers were screened using social criteria.

Site visits and audits

The year 2020 was characterized by restrictions in traveling and possibilities to perform onsite visits due to Covid-19. This meant that a majority of the 2020 onsite visits and audits were performed remotely.

In 2020, SSAB conducted 16 onsite visits and 3 extensive audits to suppliers related to sustainability matters. Evaluation is based on SSAB's Sustainable Supplier Policy and conducted by a procurement commodity manager, an internal SSAB auditor or a thirdparty auditor. Suppliers selected for onsite visits and third-party audits are identified in the annual audit plan, and based on a number of criteria, including a pre-evaluation of the supplier's social and environmental risk profile, taking into consideration geographical location, product category and spend volume.

This year's onsite visits were conducted at suppliers located in Europe and North America covering different categories including raw materials, maintenance and production related material. The main improvement areas identified were linked to work environment and safety.

SSAB also conducted three third-party sustainability audits during the year – one in Kazakhstan, one in Ukraine and a follow-up audit in Brazil. SSAB works with a leading audit company to conduct the audits. The audits revealed non-conformances primarily related to safety, work environment and governance. SSAB follows up with the respective suppliers regarding these observations. In the follow-up audit in Brazil, most of the earlier deviations could be closed.

Monitoring raw material traders

SSAB also sources alloys, coal and refractories through agents and traders. SSAB requires these suppliers to monitor their sources for sustainability commitment and we have an adapted assessment process by which these suppliers must declare how they monitor social and environmental compliance in their supply chain.

HSEQ cluster for joint evaluations of contractors

SSAB is member of an HSEQ (health, safety, environment and quality) cluster for common

Risk based approach

* Refers to SSABs Supplier Sustainability Policy

evaluations of contractors. Several of SSAB´s contractors working on SSAB´s sites are audited annually by a third party through this cluster. In 2020, 5 HSEQ evaluations of contractors were conducted in Sweden and Finland. Also, this is an activity that Covid-19 has restricted.

Actions against modern slavery

SSAB supports and respects internationally proclaimed human rights and has taken a variety of actions to verify the absence of child labor, forced labor, slavery and human trafficking in our supply chain. These actions include sustainability principles for our suppliers, sustainability risk

assessments, onsite visits and audits and training of our employees.

No conflict minerals in SSAB's steel

"Conflict minerals" is a term used for minerals derived from conflict-ridden regions or countries where the mining of certain minerals risks contributing to, or financing, continued conflict and violation of human rights. SSAB does not use conflict minerals (including gold, tin, tungsten and tantalum) and, upon request, provides customers with a certificate affirming this

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

Zero tolerance for bribery and corruption

By providing a framework for business ethics and compliance, SSAB continues to focus on creating a mature organizational culture that encourages ethical conduct. This framework provides the required support and tools to meet SSAB's expectation that each and every employee acts with honesty, integrity and responsibility in their job. The framework also ensures that we collaborate with business partners who share our ethical values.

Ethics and Compliance function

SSAB has an Ethics and Compliance function, which includes strategic responsibility for business ethics, anti-corruption and human rights, as well as for implementing new legislation and international guidelines in this area. Essential components of the ethics and compliance program are risk assessments and employee training to prevent and detect corruption and mitigate legal and ethical risks.

Sustainability strategy

SSAB has zero tolerance for bribery and corruption and this is clearly communicated by top management. One top priority is to ensure ethical conduct in line with SSAB`s corporate culture and to increase knowledge about the Code of Conduct and the Ethics Line.

SSAB works actively to prevent corruption in our business.

How we measure progress:

Share of employees who have access to the Ethics Line
Share of new employees covered by the onboarding process; including signing the Code of Conduct statement and e-learning in business ethics
Share of employees who have completed global e-learning in business ethics

Governing documents

Respect & Integrity

SSAB has several governing documents that support the ethics and compliance program:

• Company-wide Code of Conduct

environmental and social

Tone from the top is clearly communicated. All employees must take an e-learning in business

responsibility

ethics

Instructions regarding anti-corruption providing information on how SSAB defines bribery and improper benefits, and how employees are expected to act in relation to suppliers, customers and other business partners
Instructions for review of business partners describing the risk assessment process for reviewing business partners within risk areas for corruption
Instructions regarding the Ethics Line defining complaint procedures and explaining how a report is investigated

Zero tolerance for bribery and corruption
CODE OF CONDUCT	ANTI-CORRUPTION	ETHICS LINE
The Code of Conduct is the way we act. It forms the basis for our ethical,	SSAB has zero tolerance for bribery and corruption	Global whistleblower online or by calling a

Clear instructions guide us in our daily operations and how we act in relation to business

partners

Global whistleblower (Ethics Line) available online or by calling a global hotline, open 24/7

Allowing employees to raise concerns anonymously

Code of Conduct

The Code of Conduct is part of "The SSAB Way" (see page 15), which is our way of describing the culture that has made and continues to make us successful. The Code of Conduct is described as the way we act. The Code of Conduct is SSAB's ethical compass and outlines guidelines for SSAB's behavior with stakeholders and in the market. It helps us translate our values into action and forms the basis for our ethical, environmental and social responsibility commitments. The Code of Conduct covers areas such as health and safety, environment, employee relations, human rights and business practices.

Competition Law Program

SSAB has a web-based learning course on competition law aimed primarily at management teams, employees who attend trade association meetings, and the sales and procurement organization with the purpose of raising awareness of competition issues and explaining the basics of SSAB´s governing documents on competition rules. By year-end, 95% (93%) of targeted employees had completed the training.

Anti-corruption

SSAB works actively to prevent corruption in our business. SSAB's governing document for

www.transparency.se

anti-corruption defines SSAB's zero tolerance approach to bribery and corruption, and sets out guidance for our daily operations.

During 2020, SSAB became a member of Transparency International´s Corporate Supporters Forum. This membership demonstrates SSAB´s top level commitment to anti-corruption and business integrity, and provides an opportunity to collaborate with other members and share knowledge and expertise.

E-learning in business ethics

All employees are expected to comply with SSAB´s Code of Conduct, the governing document for anti-corruption, and to have knowledge of how to report non-compliances through the Ethics Line. Communication and training are organized through a global e-learning module for all employees in order to provide training, available in six languages, in business ethics and to implement anti-corruption efforts.

By the end of 2020, 91% (91%) of the employees (13,226 employees, including both office and production employees) had completed the training module. 91% of employees in Sweden, 86% in Finland and 98% in North-America had completed the training. All 11 members of the Group Executive Committee have completed the training.

Tone from the top

Ethics has everything to do with management and a clear tone from the top needs to be communicated to all employees. Each member of SSAB´s top management team has an important role to promote a corporate culture where ethics are embedded in all aspects of our business. In addition to the global e-learning in business ethics, these managers were also asked to sign a Code of Conduct statement in 2019 and 2020. By the end of 2020, 100% of the 62 invited managers had completed the two activities.

Onboarding process

New SSAB employees are expected to complete the e-learning in business ethics and to sign

a Code of Conduct statement within the first few weeks of employment. This provides new employees with an understanding of our governing documents and expectations of our employees. By the end of the year 75% (72%) of new employees in 2020 had started the process to sign the Code of Conduct statement and take the e-learning in business ethics.

Face-to-face training in business ethics

Internal training on business ethics is ongoing and is mainly provided to employees in management, sales and procurement, those who are most at risk of being exposed to corruption and bribery risks. Training is based on SSAB's values and governing documents, and teaches participants what is meant by corruption and bribery, and how SSAB's ethics and compliance program is structured. This is followed by a discussion focused on practical, real-life examples and dilemma discussions. Training requirements are continuously monitored and evaluated based on business needs and the legal and ethical risk context. During 2020, several training sessions were held for Ruukki Construction´s management and sales teams.

Review of integrity of business partners

SSAB has an instruction document for business ethics reviews that mainly covers agents and distributors in high-risk areas. SSAB may not

SSAB's global reporting tool, Ethics Line, provides employees with an avenue to raise their concerns.

enter into or renew agreements with business partners that are within the typical risk areas for corruption, before an initial assessment showing that such partners respect our fundamental rules of business ethics.

Suppliers

Contracts with suppliers refer to the Supplier Sustainability Policy, which states that all forms of corruption and bribery are unacceptable and that suppliers should work against all forms of corruption and bribery. SSAB entered into or renewed 70 raw material contracts during 2018–2020 and 55 (79%) of these contracts refer to the Supplier Sustainability Policy and the other contracts contain similar wording (data refers to the Nordic part of the procurement organization).

Hardox Wearparts Network

Contracts with companies in the Hardox Wearparts Network include an anti-corruption clause and reference to SSAB´s Code of Conduct and governing documents for anticorruption. Companies confirm that they respect and comply with the principles laid out in these documents. SSAB updated the Hardox Wearparts contract during 2017 and entered into 310 Hardox Wearparts contracts (including the anti-corruption clause) during 2017 to 2020.

Ethics Line

SSAB's global reporting tool, Ethics Line, provides employees with an avenue to raise their concerns. All employees are urged to report suspected breaches of the Code of Conduct. Employees can file a report anonymously online or by calling a global hotline 24 hours a day, seven days a week. The Ethics Line has been implemented in 14 countries. Awareness of the Ethics Line has been promoted through employee communications and web-based training. By the end of 2020, 95% (95%) of our employees had access to the Ethics Line. In 2020, 9 (14) incidents where reported through the Ethics Line. The reports related to concerns including corruption, discrimination and harassment. Following investigation actions were taken in 3 cases.

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

High-performing organization

A key element of SSAB's business strategy is to build a highperforming organization with strong employee engagement globally. SSAB will continue to work with leadership and competence development, and strive to enhance diversity in the workforce.

Employees by region1) Sweden 42% Finland 32% USA 9% Rest of Europe 13% Rest of the world 3% 1) Permanent employees at year end

Attract, hire and promote a diverse workforce for the future

Focus areas • Equal career opportunities • Hiring practices with broader outreach for

Respect & Integrity

We are inclusive and diverse

searching candidates • Transparent internal recruiting processes

Develop an inclusive and innovative workplace

Focus areas

Working with SSAB One to create involvement and engagement
Trainings on inclusion, diversity and non-discrimination • Mentoring programs

and networks

WORKFORCE	WORKPLACE	COMMUNITY
Attract, hire and promote a diverse workforce for	Develop an inclusive and innovative workplace	Be a responsible partner and enhance our reputation as a company and employer
opportunities	Focus areas • Working with SSAB One to create involvement	Focus areas • Partnership with key schools

Employer branding
Relevant Inclusion & Diversity initiatives locally

Workforce: Attract, hire and promote a diverse workforce for the future

A preferred employer

The success of our organization is based on a strong company culture, powered by a diverse, continuously learning, multi-skilled workforce. To ensure both the current and future success of SSAB, we need to be able to attract, retain, develop and motivate qualified employees both in the short-term and long-term.

We target our employer branding and recruitment efforts at diverse groups of potential candidates with relevant competences. Collaboration with selected educational institutions is via long-term partnerships. We also work together with companies in the

same geographical and competency areas to increase the attractiveness of the industry, especially in Sweden, Finland and the US. Joint efforts within the metal industry include projects such as Female Leader Engineer (Sweden), Tekniksprånget (Sweden), Women in Tech

CASE: THE TRANSITION TO FOSSIL-FREE STEEL PRODUCTION MOTIVATES YOUNG PROFESSIONALS

SSAB has been participating in a Swedish initiative, Female Leader Engineer, for 6 years. The program aims to highlight and develop female engineers in the workforce in the belief that gender equality in the workplace contributes to a variety of relevant competences and inclusion in the workplaces. This year, the winner of Female Leader Engineer 2017 Cecilia Svennberg chose to take her traineeship at SSAB. After this, she was hired by SSAB's joint-venture company Hybrit Development. For SSAB, the Female Leader Engineer program is one of the diversity and talent acquisition initiatives that the company runs in different geographies to ensure continued success in recruiting diverse and skilled top talents to work with steel, now and in the future. Cecilia's choice to take the traineeship at SSAB also illustrates the growing interest among young professionals to be part of the implementation of SSAB's fossil-free steel agenda. 13,974 29% 6.2 permanent employees in more than 50 countries employee

share of women of top management positions

turnover in 2020 94% of white-collar employees conducted

performance dialogs

(Finland) and the Association of Women in the Metal Industries (USA). These initiatives also contribute to diversity within the industry. In 2020, 777 (1,050) new employees joined SSAB. Employee turnover in 2020 was 6.2% (6.1%).

Diversity, inclusion and gender equality

SSAB is diverse in many ways: we operate in more than 50 countries and the combination of different backgrounds, service years and ages ensures diverse capabilities. For SSAB, diversity means not only building a diverse workforce with a relevant competence base, but also creating an inclusive workplace. Inclusion, meaning equal opportunities and respectful treatment of all employees, is a ground rule for every part of SSAB's organization.

Diversity is taken into account in all human resources processes and in every aspect of our business. We have zero tolerance for any kind of discrimination, whether it is based on ethnic origin, nationality, religion, political views, gender, sexual orientation or age. SSAB is taking numerous actions to enhance diversity, with most initiatives driven at the local level. For example, in recruitment, some divisions have developed processes related to ensuring diverse sets of candidates. Some sites have chosen to work with specific diversity projects, such as a 50-50 gender ratio among summer workers, or working with the local institutions to provide internships for immigrants.

SSAB is aiming to increase the number of women in top management positions. At the end of 2020, women held 29% (27%) of SSAB's top management positions. There was a positive trend in the total managerial population, where women accounted for 19.3% (18.7%) of all managers.

From April onwards, the company used different working time cuts and personnel cost adjustment

to mitigate the impacts of Covid-19.

Changes in the organization in 2020

At the end of 2020, SSAB had 13,974 (14,514) permanent employees, which was 540 employees less than in 2019. The 2020 number includes 433 employees in Abraservices, which was acquired in the end of 2019, and was not included in the 2019 numbers. In addition, the divestment of Ruukki Building Systems decreased the number of employees by 520 compared to 2019. Temporary personnel accounted for about 3.8% (3.3%) of all employees.

Since March 2020, Covid-19 has had significant impacts on our operations. Starting at the beginning of April, the company used different working time cuts and personnel cost adjustment measures, also utilizing the government support package where possible. In situations involving workforce reductions, SSAB collaborates with the authorities in the countries concerned and utilizes the means available locally to support employability.

Employees - Age distribution1)

30–50 years

50 years

1) Permanent employees at year end

Employees - Gender distribution1)

Women 20% Men 80%

1) Permanent employees at year end

Workplace: Develop an inclusive and innovative workplace

SSAB ONE and continuous improvement

SSAB ONE is our internal approach to continuous improvement, based on lean methodology. During the strategy deployment process, we define targets and cascade them from the top of the organization down to teams and individuals across the company. Over the past year, the top priorities for all divisions have been to improve both safety and production stability. In addition, improvement projects are identified at all sites with the aim to improve quality, delivery performance and cost efficiency. Cross-functional teamwork that includes employees from different levels of the company is key to successfully discovering and solving the root causes of our

challenges. We will continue to work this way as we move ahead, creating opportunities for crosslearning and sharing best practices.

Employee engagement and competence development

During 2020, SSAB moved ahead with implementing The SSAB Way concept, a corporate culture framework with the purpose of bringing our vision, values and strategy together, and clarifying how they all connect to strengthen our common culture. Implementation aims to further strengthen engagement and our company culture. Employer Branding activities, recruitment, leadership development, employee performance management and talent selection processes were updated along the lines of The SSAB Way. We also continued to gather feedback from our employees

in the form of lighter follow-up engagement surveys, which were adjusted to measure also the Covid-19 implications for our employees.

High-level competence and engaged employees are necessities for success. During the coronavirus pandemic, we made some targeted efforts in competence development to complement the ongoing competency updates. For example in Sweden and in Finland, 874 employees participated in online language courses and we implemented safety training programs at some at production sites before Covid-19 precautions had to be applied. Safety training will continue in 2021.

SSAB continued to work systematically to identify and meet the demands for critical competences and to implement competence development programs at different organizational levels. Our programs also support talent retention and include the following:

Technical specialist and business development programs
Middle manager training focusing on change management, team leadership and financial understanding
In-house mentoring programs
Management programs for new line managers
Competency program for Fossil-Free Steel 2045

In addition to globally coordinated programs, our sites are responsible for organizing programs to improve professional competencies and to ensure mandatory training is completed.

SSAB maintains a group talent pool for future leaders, which includes candidates from all parts of the organization. Talent pool candidates are offered personal competence development plans, including leadership training, coaching, mentoring and on-the-job learning. The talent pool is based on nominations by division and functional leaders.

Annual performance dialogs are the key process for ensuring that competence development plans are in place, setting performance goals, providing a basis for continuous performance feedback and for cascading the group level strategic targets down to divisional, team and individual targets. For office workers, the annual rate of performance dialogs conducted in 2020 was 94% (95%).

To support engagement and talent retention, the company has a pay-for-performance compensation approach, which means that compensation is to a certain extend, based on job requirements and employee performance. The different compensation and benefits programs are reviewed as needed.

Community: Be a responsible partner and enhance our reputation as a company and employer

In locations where SSAB operates, the company plays a significant role in the local and regional community as an employer, taxpayer, buyer of regional goods and services, and charitable benefactor. Contributing to the communities in which we operate is an integral part of the way we do business.

Active engagement in local communities

SSAB strives to develop and maintain good relationships with various stakeholders in our society and actively engages with the communities in which we operate. Local community engagement is defined by each site at the local level. SSAB is also an important partner for local educational institutions and research. We offer opportunities for internships and thesis projects to college students. SSAB also works with local environmental regulators on site-specific issues. In addition to ongoing collaboration with local authorities, SSAB works together with cities and associations to monitor environmental conditions such as air quality and waterways. Every year, SSAB hosts important visitors from the community, such as students, customers, subcontractors, government officials, inspectors and regulators.

Supporting local activities in Sweden and Finland

In the communities in which SSAB operates in Sweden and Finland, we contribute to creating a wide range of recreational activities in which SSAB's employees, their families and also the local community can participate. Examples include sponsorships of local sports organizations and exchange of knowledge with schools. SSAB also supports associations in which employees are involved, primarily within sports and culture.

Strong community involvement in SSAB Americas

SSAB Americas has a long tradition of community involvement. This takes place not only in the form of financial contributions, but also through participation in various charity initiatives and projects. SSAB is an important partner for local educational institutions and research. SSAB Americas sponsors an annual scholarship at the University of South Alabama, which benefits fulltime junior and senior students in the University's College of Engineering. SSAB Americas also supports primary education through the SSAB Foundation for Education. Employees also participate in numerous activities throughout the year to benefit their communities, including food drives, fundraising events and volunteer opportunities.

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL GRI REPORT SUPPLEMENT LEADING SUSTAINABILITY PERFORMANCE

102-8 Information on employees and other workers

Number of employees by gender (at end of period)

	2020	2019	2018
Women	2,833	2,859	2,883
% of which are permanent	94.2%	95.2%	91.5%
% of which are temporary	5.8%	4.8%	8.5%
% of which are full-time	98.3%	96.3%	96.7%
% of which are part-time	1.7%	3.7%	3.3%
Employee turnover 2)	1.3%	1.1%	1.5%
Men	11,695	12,155	12,340
% of which are permanent	96.7%	97.0%	94.6%
% of which are temporary	3.3%	3.0%	5.4%
% of which are full-time	98.4%	97.4%	97.7%
% of which are part-time	1.6%	2.6%	2.3%
Employee turnover 2)	5.0%	5.0%	5.6%
Total workforce	14,528	15,014	15,223
% of which are permanent	96.2%	96.7%	94.0%
% of which are temporary	3.8%	3.3%	6.0%
% of which are full-time	98.4%	97.3%	97.5%
% of which are part-time	1.6%	2.7%	2.5%
Employee turnover 2)	6.2%	6.1%	7.1%

Number of employees by region and gender and employee turnover (at end of period)1)

	2020	2019	2018
Sweden	6,083	6,252	6,482
% of which are women	21.2%	21.0%	21.0%
% of which are men	78.8%	79.0%	79.0%
Employee turnover 2)	3.0%	2.4%	2.8%
Finland	4,687	5,075	5,172
% of which are women	15.6%	15.2%	15.0%
% of which are men	84.4%	84.8%	85.0%
Employee turnover 2)	1.7%	1.7%	1.7%
USA	1,302	1,310	1,296
% of which are women	12.4%	12.9%	13.3%
% of which are men	87.6%	87.1%	86.7%
Employee turnover 2)	0.6%	0.6%	0.7%
Other Europe	1,962	1,949	1,843
% of which are women	26.8%	25.2%	24.9%
% of which are men	73.2%	74.8%	75.2%
Employee turnover 2)	0.8%	1.0%	1.7%
Rest of the world	494	428	430
% of which are women	24.9%	26.6%	26.7%
% of which are men	75.1%	73.4%	73.3%
Employee turnover 2)	0.2%	0.3%	0.2%

1) Permanent and temporary

2) Permanent

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405-1 Diversity of governance bodies and employees

Percentage of individuals within the organization's governance bodies in the diversity categories gender and age group

	2020		2019		2018
	Board of Directors1)	Group Executive Committee	Board of Directors1)	Group Executive Committee	Board of Directors1	Group Executive Committee
Total number	8	11	8	11	8	11
Women	50%	27%	38%	27%	38%	27%
Men	50%	73%	63%	73%	63%	73%

<30 years	0	0	0%	0%	0%	0%
30–50 years	13%	36%	13%	36%	0%	45%
>50 years	88%	64%	88%	64%	100%	55%

1) Alternate members (6) not included

Percentage of total number of employees per employee category and diversity categories gender and age

	2020			2019			2018
	Frontline workers	Office employees	Total	Frontline workers	Office employees	Total	Frontline workers	Office employees	Total
Women	11%	33%	20%	10%	32%	18%	10%	32%	18%
Men	89%	67%	80%	90%	68%	82%	90%	68%	82%

<30 years	15%	8%	12%	14%	5%	10%	13%	5%	10%
30–50 years	51%	57%	53%	50%	59%	54%	51%	60%	54%
>50 years	34%	35%	35%	36%	36%	36%	36%	35%	36%

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Human rights and fair labor conditions

SSAB's commitment to human rights is confirmed in our Code of Conduct and in our Supplier Sustainability Policy. We have zero tolerance for forced or compulsory labor and child labor. We focus on providing a safe work environment where employees are free from harassment and discrimination

All SSAB´s employees in Sweden and Finland are covered by collective bargaining agreements and approximately 70% of our employees in Sweden and Finland are represented by trade unions.

Other countries have different arrangements according to country-specific practices, traditions and labor legislation. SSAB respects employee rights to, if they so choose, organize in accordance with the legislation and provisions in each respective country of residence. SSAB provides channels for employees to engage in the company's activities and express their opinions. Local management in each country is responsible for creating opportunities for employee engagement. The company also encourages direct interaction between supervisors and their teams.

The unions at SSAB in Europe have a European Works Council (EWC). The purpose of an EWC is to bring together employee representatives

from the different European countries in which a multinational company has operations. During EWC meetings, these representatives are informed and consulted by central management on transnational issues of concern to the company's employees.

To mitigate human rights risks, we continuously work to ensure compliance with local law and international standards on human rights. We have conducted a human rights risk assessment where representatives from sales, procurement, health and safety, environment and HR participated. External human rights expertise facilitated two internal workshops to raise awareness of human rights and identify key human rights risks and mitigation actions for the involved functions and their processes. The overall conclusion is that SSAB performs well.

Human rights are important aspects when evaluating suppliers. Read more on p. 81.

BUSINESS REVIEW

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SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE

Reporting practice

SSAB's Sustainability Report 2020 is prepared in accordance with the GRI Standard: Core. Sustainability disclosure requirements in the Swedish Annual Accounts Act are covered by the GRI Disclosures. The 2020 Annual Report also constitutes SSAB's Communication on Progress (CoP) for the UN Global Compact.

SSAB's 2020 Annual Report consists of the business review, sustainability report, financial reports 2020 and corporate governance report. This GRI report supplement contains information and data not reported elsewhere in the SSAB's 2020 Annual Report, but required in GRI Standards or by the Swedish Annual Accounts Act on the disclosure of sustainability information. The GRI index specifies where the information for each topic and indicator can be found and explains any omissions to the reported data. The information disclosed in this report focuses on material information and data, whereas more comprehensive information about sustainability is available on SSAB's sustainability website. SSAB's 2020 Annual Report is published in English and Swedish in PDF format and is available on SSAB's website.

Assurance of reporting

EY has provided limited assurance on SSAB's sustainability report in accordance with GRI Standards and expressed an opinion on the statutory sustainability report in accordance with the Swedish Annual Accounts Act. See p. 115 for the assurance report.

Scope of data

The financial information in this report is based on SSAB's consolidated financial statements and is subject to audit. Unless otherwise stated, the financial data referred to in this report covers the whole SSAB Group. Information about personnel (HR data) has been collected from the company's corporate-wide personnel information systems. Unless otherwise stated, the HR data referred to in this report covers the whole SSAB Group. Reporting does not cover associated companies and joint ventures or subcontractors and suppliers of goods and services, unless otherwise stated.

Regarding environmental data, the following production sites are included in the environmental reporting scope in 2020, which form the material scope for reporting:

• SSAB Special Steels: Oxelösund and Virsbo in Sweden

SSAB Europe:
Luleå, Borlänge and Finspång in Sweden
Raahe, Hämeenlinna, Kankaanpää, Lappohja, Oulainen, Pulkkila, Toijala in Finland
SSAB Americas:
Mobile in Alabama and Montpelier in Iowa, USA
Ruukki Construction
Peräseinäjoki and Ylivieska in Finland
Järnforsen in Sweden
Gargzdai in Lithuania and Oborniki in Poland
Tibnor:
- Köping in Sweden

These sites cover the following operations: all steel mills, all rolling mills, all coating lines and all tube mills as well cut-to-length (CTL) lines if located at the sites mentioned above.

Significant changes to the organization

In 2020, Ruukki Construction completed the divestment of its Building Systems business.

Building Systems employed some 500 persons, who were transferred to the service of the new owner under their existing terms and conditions of employment.

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SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE

Sustainability governance

Sustainability governance at SSAB is based on the company's vision, values and Code of Conduct complemented by our governing documents. Sustainability, including climate issues, is an integral part of SSAB's strategy. The Board of Directors has the highest decision-making authority in these matters. SSAB's Board of Directors is collectively responsible for strategically managing climate issues and SSAB's transformation to fossil-free company.

Organization of sustainability work

SSAB's Board of Directors approves the Code of Conduct, as well as the sustainability strategy and monitors SSAB's sustainability performance, including climate-related issues. The Board of Directors approves Group performance targets, including sustainability and climate-related targets. SSAB's Group Executive Committee (GEC) is responsible for outlining the company's strategic approach to sustainability, including adopting material topics, and monitors how sustainability is implemented in the divisions, subsidiaries and support functions. Sustainability issues are frequently on SSAB´s Group Executive Committee's agenda to ensure the close involvement of top management.

The Head of Sustainability is a member of the Group Executive Committee and is responsible for strategy development and coordination of sustainability at Group level as well as health and safety and ethics and compliance for the Group. The Head of Sustainability leads a Sustainability management team, which is a network of people with expertise in different sustainability areas, including representation from the divisions and subsidiaries, with the responsibility to coordinate and drive SSAB's sustainability initiatives.

In the Group Executive Committee, there are several executives responsible for implementing different parts of SSAB's fossil-free transition. For example, the Executive Vice President (EVP) and Head of Technical Development manages the HYBRIT implementation and also has a seat on the Board of HYBRIT Development AB, a joint venture aiming for fossil-free steelmaking. The EVP and Head of Sustainability manages operational initiatives towards SSAB becoming fossil free, the EVP and Head of Strategy manages SSAB's Risk Enterprise Management process, which includes climate risks, and the EVP

SUSTAINABILITY APPROACH FIRST IN FOSSIL-FREE STEEL LEADING SUSTAINABILITY PERFORMANCE

and Chief Financial Officer manages investments and financial matters related to climate change mitigation and adaptation.

To support work related to environmental issues, SSAB has environmental councils, which include representatives from divisions, main production sites and from SSAB's subsidiaries, Ruukki Construction and Tibnor. In issues related to responsible sourcing, there is a procurement council, whose mission is to enhance global procurement processes and projects, and to collaborate on sustainability and continue our strong focus on responsible sourcing. In 2019, a health and safety council was established with representatives from the business, with the responsibility to coordinate, cooperate and propose policy and strategy initiatives and changes to the GEC.

SSAB links sustainability issues to compensation. For example, internal safety and SSAB's transition to becoming fossil-free are part of incentive plans for selected employee groups and top management. Individual performance targets might also include targets for emissions reductions or other sustainability related topics for selected employee groups.

At SSAB, risk management is integrated in the annual strategy process and includes the involvement of the Group Executive Committee, the Audit Committee and the Board of Directors. Sustainability risks, including climate change risks, are integrated into our Risk Enterprise Management process, which is presented to the Board annually. Read more on p. 149 in Financial Reports 2020. The management approaches of the material sustainability topics are described on p. 102–109.

Governing documents and principles for sustainability

The SSAB Way and company's core values define who we are and how we should act. The Code of Conduct, the sustainability strategy and the governing documents at Group-level regarding sustainability (e.g. environment and safety), are our most important documents. There are also local governing documents to further elaborate on internal rules. All these documents are regularly reviewed and updated. Our sustainability governing documents are available on ssab.com.

Management systems and risk management

Management systems and action plans ensure that SSAB systematically works on critical aspects of sustainability. Several different management systems and tools, both developed in-house and third-party certified, are used to effectively control operations in accordance with SSAB's Code of Conduct and governing

documents. Safety management systems for systematic health and safety work, according to OHSAS 18001 or ISO 45001:2018 (which will replace OHSAS in 2021), have been implemented at all production sites. Environmental and climate work take place primarily within the scope of the ISO 14001 environmental management standard and via local energy management systems.

Global Compact

SSAB is a signatory to the UN Global Compact and we continually enhance our efforts to protect and respect its 10 principles, and promote its spirit within the areas of human rights, labor standards, the environment and anti-corruption. SSAB also supports the International Bill of Human Rights, ILO Core Conventions, the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights.

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Stakeholder engagement

Key stakeholder groups

SSAB's key stakeholders are those who are impacted by SSAB's operations and activities, and who similarly impact SSAB. The following are SSAB's most important stakeholder groups:

Existing and potential customers
Existing and potential employees
Shareholders, investors and financiers
Existing and potential suppliers
Local communities near SSAB's production sites
Public agencies and organizations

Other stakeholders SSAB interacts actively with include the media, analysts, regulators, various research bodies and partner organizations, research institutes, universities and vocational schools.

Approach to stakeholder engagement

SSAB aims for regular, honest and transparent interaction with our stakeholders. We actively maintain and develop stakeholder relations and draw on information obtained from them when developing our operations, products and services. Transparent and continuous dialog increases the trust in SSAB's ability to manage risks and utilize opportunities, which at the same time enhances the development of the company.

Stakeholder group	Examples of engagement	Key concerns, expectations	SSAB's response/actions
Existing and potential customers	• Materiality analysis survey • Dialog on how to decrease customers' climate impact • Personal sales work and meetings with customers • Technical support • Knowledge Service Center Customer seminars and training • Trade fairs • Site visits • Swedish Steel Prize	• Input on material aspects • Using stronger and lighter materials • High quality, sustainable products • Reliability • Services • R&D cooperation and support	• We ask our stakeholders to give their opinion on SSAB's material aspects • By using stronger and lighter materials, customers' climate impact is decreased as well as their costs in the use phase • We offer our customers a broad range of high-strength and wear resistant steels that enable improved efficiency and sustainability benefits in the applications they are used • We have developed the SSAB EcoUpgraded concept, which highlights the environmental benefits of upgrading to high-strength steel • Through close customer collaboration, we continuously develop new products, services and applications • Good delivery performance is our highest priority
Existing and potential employees	• Materiality analysis survey • Performance dialogs • Coaching and training • Site safety committees • Info screens, intranet • Employee surveys • Cooperation with local universities and schools to engage potential future employees • Regular dialogs with unions, centrally and locally	• Input on material aspects • Healthy and safe work place • Equal treatment and open communication • Job security and incentivizing compensation • Opportunities for professional development • Responsible and sustainable operations • Employee related sustainability matters	• We ask our stakeholders to give their opinion on SSAB's material aspects • We operate in line with our vision, values and Code of Conduct • We promote a high-performing organization • Our long-term safety goal is zero accidents and we are committed to striving for this through our safety work • Our employee compensation is based on standardized principles • We work toward having a more diverse workforce and becoming a more attractive employer • We value constructive dialog with our unions

Key topics discussed with stakeholders in 2020:

SSAB's new sustainability strategy and target setting
First in fossil-free steel and our leading sustainability performance
CO2 emissions and how SSAB works to reduce our carbon footprint incl. Science Based Targets
HYBRIT (Hydrogen Breakthrough Iron Making Technology) initiative
Safety in SSAB's operations
Covid-19 and its impact on our employees and operations
Responsible and sustainable supply chain
Anti-corruption and ethics compliance

Corporate climate policy engagement

SSAB's corporate climate policy engagement is based on SSAB's commitment to be a fossil-free company by 2045 and aim to be the first to offer fossil-free steel to the market in 2026. SSAB's targets for greenhouse gas emissions including carbon dioxide have been approved by the Science Based Targets initiative and in line with the objective of keeping global warming well below 2°C. SSAB's engagement with policy- and decision makers globally, in the EU and nationally, aim to inform on the opportunities, challenges and needs connected to industrial decarbonization, and especially for the steel industry. Among the policy areas of specific interest to SSAB are climate policy, energy policy, and industrial policy, as well as issues related to public funding and efficient

Stakeholder group	Examples of engagement	Key concerns, expectations	SSAB's response/actions
Shareholders, investors and financiers	• Materiality analysis survey • Annual General Meeting • Result conferences and webcasts • Capital Markets Day • Investor meetings	• Long-term value creation • Climate impacts and risks • Responsible governance • Sustainable operations (CO2 emissions, resource efficiency) • Safety • Transparency and reliable reporting	• We updated our sustainability strategy, including targets, in 2020 following a materiality analysis conducted in 2019 • Our strategic growth targets were adopted in 2017 and their realization is ongoing • We are committed to achieving our financial targets • We take economic, social and environmental responsibility into consideration in our business • We are committed to reducing CO2 emissions both short and long-term • Our long-term safety goal is zero accidents and we are committed to striving for this through our safety work
Existing and potential Suppliers	• Materiality analysis survey • Supplier management process including: audits, development meetings, price and other negotiations • Visits to suppliers • Training, supplier days	• Input on material aspects • Good financial position • Fair and equal treatment of suppliers • Long-term business relations • Responsible operations	• We ask our stakeholders to give their opinion on SSAB's material aspects • We operate in line with our vision, values and Code of Conduct • We implement responsible sourcing practices • We manage supplier relationships in a systematic manner • We train contractors in work safety
Local communities near SSAB's production sites	• Materiality analysis survey • Locally, engagement with politicians, regulators, the media and the general public, people living close to the production sites	• Input on material aspects • Creating well-being locally through employment, local purchasing and taxes • Operational safety • Reducing emissions, noise and other inconveniences close to production sites • Open communication and interaction	• We ask our stakeholders to give their opinion on SSAB's material aspects • We have a significant role in the local and regional community as an employer, tax payer, buyer of regional goods and services • We promote sustainable development of the local communities, participate in local initiatives, and sponsor selected local activities
Public agencies and organizations	• Materiality analysis survey • Involvement in many research projects to drive technological developments • Collaboration with industry associations on many topics	• Input on material aspects • Climate change, reducing CO2 emissions and other environmental impacts • Responsible and sustainable operations	• We ask our stakeholders to give their opinion on SSAB's material aspects • We communicate openly and we actively engage in a dialog with different organizations about key issues

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permit processes. For our out-reach activities in the European Union, SSAB is registered in the EU Transparency Register.

SSAB's corporate climate policy engagement and outreach strategy is decided by the group executive management and executed by our experts. SSAB pursues this engagement directly, and sometimes indirectly through the industry associations or other organizations in which SSAB is a member.

Memberships of Associations and National or International Advocacy Organizations (GRI 102-13) The following table lists SSAB's key memberships by country or area.

Area or country	Organizations
Globally	The Leadership Group for Industry Transition (LeadIT), Energy Transitions Commission (ETC)
Europe	Eurofer, Euroslag, Eurometal, Corporate Leadership Group (CLG) (indirectly, through the membership of Hybrit Development AB)
North America	American Iron and Steel institute (AISI), National Association of Manufacturers (NAM), Steel Manufacturers Association (SMA)
Sweden	Jernkontoret, Svenskt Näringsliv (Confederation of Swedish Enterprise), SKGS (Skogen, Kemin, Gruvorna och Stålet), Steel and Metal Wholesalers Association, the Swedish Institute of Steel Construction, Swedish Mineral Processing Research Association, Swedish Cement and Concrete Research Institute, Swedish Leadership for Sustainable Development, Fossilfritt Sverige (Fossil-free Sweden)
Finland	Finnish Metal Producers, Suomen ElFi (Finnish Large Electricity Consumers), Finnish Constructional Steelwork Association, Confederations of Finnish Construction Industries, the Federation of Finnish Technology Industries, Finnish Coal Info

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Materiality assessment

In 2019, SSAB conducted a new materiality analysis to determine our most relevant and material sustainability topics to define a new sustainability strategy and targets, as well as the content of SSAB's GRI reporting. Material topics were identified and prioritized in a process that involved external and internal stakeholders. The GRI principles – stakeholder inclusiveness, sustainability context, materiality and completeness – were taken into consideration throughout the process.

As a first step, SSAB conducted a background analysis to identify industry trends and global drivers. This analysis, as well as SSAB's previous materiality analysis (2014) and existing SSAB's sustainability strategy, served as a basis to identify relevant topics throughout SSAB's value chain.

As a second step, the topics identified in the background analysis were evaluated and ranked according to importance from the perspectives of both SSAB and external stakeholders. This was done through interviews with external stakeholders (customers, suppliers, investors, NGOs and industry associations) and an online survey with key external and internal stakeholders to further prioritize the topics. The results of the dialog with internal and external stakeholders were evaluated in workshops with

internal experts, and confirmed by SSAB's Group Executive Committee.

The material topics included in SSAB's 2020 reporting are based on this materiality analysis. The list of material topics, their boundaries, as well as management approaches are presented in the tables on the following pages. For a full list of reported GRI indicators see also GRI index on p. 110.

SUSTAINABILITY APPROACH	FIRST IN FOSSIL-FREE STEEL	LEADING SUSTAINABILITY PERFORMANCE
information can be found in SSAB's 2020 Annual Report. First in fossil-free steel	Material topics and Management Approach Disclosures (GRI 103-1) SSAB's strategic sustainability themes and material sustainability topics, as well as the management approaches for them are presented in the following tables or there is a reference to pages where the	BR = Business Review 2020 SR = Sustainability Report 2020 CGR = Corporate Governance Report 2020 FR = Financial Reports 2020
Use better steel • Benefit from leading CO2 efficient production • Reduce your footprint with low CO2 steel
Material topics	Reduced GHG emissions (CO2)
Why the topic is material	Coke and coal are used in blast furnaces to reduce iron ore in the production of crude iron/hot metal. With the current technology, it is impossible to produce steel without generating CO2 emissions. The process, has been continually developed and improved to become highly efficient, and the residual energy is recovered in the form of district heating and electricity production. SSAB's blast furnace-based production is among the most CO2 efficient in the world. This gives a competitive advantage to SSAB and its customers. Scrap-based steel production at SSAB's US mills emits significantly less CO2. Since there is not enough scrap available to meet the demand for steel, ore-based steel production using blast furnaces is still needed. Today, scrap-based steel production meets 25% of the global demand for steel.
GRI material topics	GRI 305: Emissions
SDG	7, 9, 12, 13 and 17
Reported GRI indicators	305-1: Direct (Scope 1) GHG emissions, 305-2: Energy indirect (Scope 2) GHG emissions, 305-3: Other indirect (Scope 3) GHG emissions, 305-4: GHG emissions intensity, 305-5: Reduction of GHG emissions
SDG
Policies, management systems	Group's governing documents regarding environment establish the most important ambitions for SSAB's environmental work and cover those environmental topics, which play a key role in the sustainable development of SSAB's business. The governing documents regarding environment support the day-to-day work across the organization. SSAB's environmental governing document is available on ssab.com. SSAB's environmental management is based on the international environmental management system standard, ISO 14001. In 2020, all of SSAB's manufacturing sites had third party certification for the ISO 14001 standard. SSAB's operations are subject to environmental permits containing numerous environmental conditions governing various parameters regarding production levels, air emissions, discharge water effluent, and
	waste management. SSAB records all environmental damage and other environmental non-compliances and reports them to the appropriate authorities.
Goals and targets	SSAB's sustainability strategy includes a Greenhouse gas emissions (CO2e) reduction target until 2032, which has been approved by the Science Based Targets initiative (SBTi). Read more in SR p. 49.
Responsibilities	SSAB's Executive Vice President and Head of Technical Development is responsible for environmental issues (including climate change). He also acts as the Chairman of the Board of HYBRIT Development AB, a joint venture aiming for fossil-free steel making. To support work related to environmental issues, SSAB has Environmental Councils, which include representatives from divisions, main production sites and from SSAB's subsidiaries, Ruukki Construction and Tibnor. Divisions, subsidiaries and sites are responsible for putting environmental protection into practice. Each production site has an environmental team or manager responsible for monitoring compliance with legislation and handling permits. Internal and external audits at sites ensure that everyday practices comply with set targets.
Specific actions	SR 57–58, 63–65, 71–75
Main risks related to the topic	Environmental risks are included in the enterprise risk management process. Emissions from normal operating conditions are controlled and subject to environmental permit limits. Regular risk assessments cover possible emissions in the event of disruption or accident. The results of this assessment serve as the basis for preventive measures and corrective actions at the relevant levels. The main environmental risks are reported in FR 149–156.
Monitoring the effectiveness of our approach	SSAB ensures continuous development by monitoring environmental performance against environmental targets and the environmental management system. SSAB conducts external audits regularly at all sites to verify continuous improvements according to the ISO standards.
Topic boundaries	SSAB's production sites, SR 95 for more information on sites included in the environmental data.

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First in fossil-free steel

Use steel better
• SSAB steel makes products lighter and stronger • Reduce CO2 emissions in the use phase
Material topics	Lower energy consumption/Higher productivity for customers
Why the topic is material	Although an increased availability of steel scrap in the future will enable an increase in scrap-based steel production, the increasing global demand for steel can only be met by continuing to utilize ore based iron production. To align with a transition to a low-carbon economy, the steel industry will require a step-change in emissions reductions through alternative steelmaking processes.
How the topic is managed	SSAB works with our customers to upgrade their products using high-strength steels. This means using less steel while reducing weight, improving fuel economy and extending product lifetime – all of which significantly contribute to reducing a product's environmental footprint.
	SSAB's vision – "A stronger, lighter and more sustainable world" – serves as the basis for how we manage this topic. Our vision means that together with our customers, we will go further than anyone else in realizing the full potential of lighter, stronger and more durable steel products.
	SSAB's "Taking the Lead" strategy continues to drive the strategic decisions and actions of the company. One of the main themes in the strategy is the "Global leadership in high-strength steels." Read more in BR 23.
	SSAB's sustainability strategy that supports SSAB's "Taking the Lead" strategy with two focus areas – First in fossil-free steel and Leading sustainability performance. Read more in SR 46.
	By using SSAB's high-strength steels, which result in lower weight and improved fuel economy, customers can achieve significant CO2 savings during their end products' use-phase. The objective is that, by the end of 2021 (earlier 2020, pushed back due to Covid-19 impacts), these annual customer CO2 savings will reach 10 million tonnes, which is slightly more than SSAB´s own direct CO2 emissions.
	To remain at the forefront in the industry, SSAB will continue to invest in research and development, technical customer support and joint innovation initiatives to get the most out of SSAB's high-strength and advanced high-strength steels, and premium steels.
GRI material topics	No relevant topic in GRI
SDG	7, 9, 12, 13 and 17
Reported GRI indicators	No relevant indicators in GRI. Environmental benefits from using SSAB's special steels are described in SR 59. Sales and tonnes of delivered high-strength steels, BR 24
Goals and targets	SSAB's strategic growth targets for Special Steels volumes and Automotive AHSS volumes, BR 24.
	For high-strength steels we have set a target for annual customer CO2 savings. This was originally set for 2020, but has been pushed back to 2021 due to the Covid-19 impacts. This target will eventually be replaced by a target on resource efficiency in the use phase. Read more in SR 48. These targets will contribute to SSAB's vision of a stronger, lighter and more sustainable world.
Responsibilities	Sustainability governance SR 96. SSAB's Group Executive Committee is responsible for outlining the company's strategy, including "Global leadership in high-strength steels" and "Use steel better," setting targets and monitoring how they are implemented in the divisions, subsidiaries and support functions.
	• Executive Vice President and Head of Research and Innovation is responsible for managing SSAB-level R&D functions. Technology and product development are managed by the respective technology organizations of the divisions, supported by the sales and marketing functions.
Specific actions	BR 25–26, 30–31 and 33–34 (Strategy, SSAB Special Steels, SSAB Europe)
Main risks related to the topic	Main risks are described in the risks section in FR 149–156.
Monitoring the effectiveness of our approach	The management approach is assessed continuously as part of our business operations, and processes are improved accordingly to ensure that the set targets are achieved.
Topic boundaries	SSAB Group, SSAB's customers

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First in fossil-free steel

Go fossil-free • Be part of a fossil-free value chain • Be the first to offer fossil-free products
Material topics	First in fossil-free steel
Why the topic is material	Although an increased availability of steel scrap in the future will enable an increase in scrap-based steel production, the increasing global demand for steel can only be met by continuing to utilize ore based iron production. To align with a transition to a low-carbon economy, the steel industry will require a step-change in emissions reductions through alternative steelmaking processes.
How the topic is managed	SSAB's overall goal is to become fossil free by 2045. Our ambition is to be the first to offer the market fossil-free steel as early as 2026, and over time to convert all production sites to become fossil free. This transformation will be done through HYBRIT (Hydrogen Breakthrough Ironmaking Technology), a joint venture between SSAB, LKAB, and Vattenfall. We see HYBRIT and our transformation as an opportunity to revolutionize steel production throughout the lifecycle - from steelmaking, to end use and 100% recyclability. By cooperating with LKAB, our iron ore pellets supplier, and Vattenfall our electricity supplier, we also ensure a value chain perspective.
GRI material topics	GRI 305: Emissions
SDG	7, 9, 12, 13 and 17
Reported GRI indicators	305-1: Direct (Scope 1) GHG emissions, 305-2: Energy indirect (Scope 2) GHG emissions, 305-3: Other indirect (Scope 3) GHG emissions, 305-4: GHG emissions intensity, 305-5: Reduction of GHG emissions
Goals and targets	SSAB is working toward a fossil-free steelmaking process through the HYBRIT initiative and by eliminating other fossil related emissions, with a goal to offering fossil-free steel in 2026 and fossil-free operations by 2045. Read more in SR 71.
Responsibilities	SSAB's Board of Directors is collectively responsible for climate issues and SSAB's transformation to fossil-free company. In the Group Executive Committee, there are several executives responsible for implementing different parts of the transformation. For example, the Executive Vice President (EVP) and Head of Technical Development manages the HYBRIT implementation and also has a seat on the the Board of HYBRIT Development AB, a joint venture aiming for fossil-free steel making. The EVP and Head of Sustainability manages operational initiatives towards SSAB becoming fossil-free, the EVP and Head of Strategy manages SSAB's Risk Enterprise Management process, which includes climate risks, and the CFO manages investments and financial matters related to climate change mitigation and adaptation.
Specific actions	SR 63–65, 71–75
Main risks related to the topic	Main risks are described in SR 74 and the risks section in FR 149–156.
Monitoring the effectiveness of our approach	The management approach is assessed continuously as part of our business operations, and processes are improved accordingly to ensure that the set targets are achieved.
Topic boundaries	SSAB Group, SSAB's customers, SSAB's suppliers

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Leading sustainability performance

Safety first • Becoming the world's safest steel company
Material topics	Occupational Health & Safety Process safety
Why the topic is material	SSAB is determined to become the world's safest steel company, with the objective of achieving zero accidents, work-related injuries and illnesses. Everyone in SSAB has the right to a healthy, accident free work environment. Our goal is to prevent all injuries and work-related illnesses. We will minimize, as far as possible, health and safety risks everywhere we operate.
GRI material topics	GRI 403: Occupational health and safety
SDG	3
Reported GRI indicators	403-1 Occupational health and safety management system, 403-2 Hazard identification, risk assessment, and incident investigation, 403-3 Occupational health services, 403-4 Worker participation, consultation, and communication on occupational health and safety, 403-5 Worker training on occupational health and safety, 403-6 Promotion of worker health, 403-7 Prevention and mitigation of occupational health and safety impacts directly linked by business relationships, 403-9 Work-related injuries
Policies, management systems	SSAB's Group governing documents on safety, SSAB's safety management system fulfils the requirements of international standard OHSAS 18001/ISO 45001 and is implemented at all SSAB sites. SR 67
Commitments	The ILO Declaration on Fundamental Principles and Rights at Work, UN Global Compact, UN Sustainable Development Goals, OECD Guidelines for Multilateral Enterprises all include provisions related to safety
Goals and targets	SSAB strives to be the world's safest steel company, with an objective to achieve zero accidents, work-related injuries or illnesses. SSAB has set several targets and KPI's to measure the progress toward SSAB's goal of becoming the world's safest steel company. Read more in SR 50.
Responsibilities	Every SSAB employee has a personal responsibility to work safely every day; it is a fundamental requirement for working at SSAB. SSAB has a Group-level Health and Safety Council role to coordinate, cooperate and propose policy and strategy initiatives, and changes to the Group Executive Committee (GEC). The H&SC is the decision-making body on safety issues relevant for SSAB.
Specific actions	The long-term work to improve safety continued throughout 2020. For more information on SSAB's safety work, refer to SR 69.
Main risks related to the topic	Serious safety hazards and personnel accident(s) is one of the main internal risks identified for SSAB. Read more in the risks section in FR 149–156.
Monitoring the effectiveness of our approach	SSAB ensures continuous development by monitoring following up performance against our targets and the safety management system.
Topic boundaries	SSAB Group, SSAB's contractors

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Leading sustainability performance

Efficiency & Responsibility: Resource efficient operations
Material topics	Circularity
Why the topic is material	The production of iron and steel creates a range of residuals. Recirculating ferrous material back into the steelmaking process reduces the need for virgin raw materials. This, in turn, reduces CO2 emissions and saves costs. Materials that cannot be recirculated internally can be processed and sold externally to create new revenue streams while reducing CO2 emissions by substituting natural resources in other industries. For example, the use of blast furnace slag enables the cement industry to significantly reduce their CO2 emissions. Increasing internal recirculation of residuals and external sales of by-products will lead to reduced waste and less material being sent to a landfill. A critical element in reducing carbon emissions originating in the steel lifecycle is to optimize steel recycling. Steel is unique in its capacity to be infinitely recycled without loss of properties or performance. Steel is the most recycled material in the world today.
	Energy efficiency is aimed at reducing the amount of energy required to produce products and provide services. Steel companies can reduce costs by finding alternative energy sources that create less emissions, by using less purchased energy and by feeding surplus energy into the grid. From a lifecycle perspective, this also creates positive effects and saves natural resources, thereby reducing CO2 emissions.
How the topic is managed	SSAB works to optimize the value of its by-products, scrap and waste with a focus on sustainability and value creation. SSAB's recycling operations cover the entire value chain from R&D and production to marketing and sales. The operations consist primarily of recirculation of materials to SSAB's own production, processing and selling products externally and managing waste that cannot be recirculated or processed into new products in a sustainable way. This includes the handling of materials sent to a landfill in the Nordics. SSAB delivers by-products globally.
	Energy efficiency is improved through systematic energy management and energy recovery. To improve energy efficiency, energy flows are recycled in the production process. Process gases like blast furnace gas, coke oven gas and converter gas are generated in the iron- and steelmaking processes. Steam and hot water are also produced. These energy flows can be fully recovered to generate electricity and heat, thereby saving fuel resources and decreasing CO2 emissions. Recovered heat has been used to produce district heating in Luleå, Raahe and Oxelösund since the 1980s, accounting for about 90% of local district heating needs.
	In addition to the material environmental topics addressed in the SSAB Group target setting (i.e. greenhouse gas emissions and circularity), a wider range of environmental topics are addressed at the division and site levels, including other air emissions and water issues.
GRI material topics	GRI 302: Energy, GRI 301: Materials, GRI 306: Effluents and Waste
SDG	9,12, 13
Reported GRI indicators	301-1 Materials used by weight or volume, 301-2 Recycled input materials used , 306-2: Waste by type and disposal method, 305-7: Nitrogen oxides (NOX), sulfur oxides (SOX), and other significant air emissions, 302-1 Energy consumption within the organization, 302-3 Energy intensity, 302-4 Reduction of energy consumption, 303-1 Water withdrawal by source
Policies, management systems	Group's governing documents regarding environment establish the most important ambitions for SSAB's environmental work and cover those environmental topics, which play a key role in the sustainable development of SSAB's business. The governing documents regarding environment support the day-to-day work across the organization. SSAB's environmental governing document is available on ssab.com.
	SSAB's environmental management is based on the international environmental management system standard, ISO 14001. In 2020, all of SSAB's manufacturing sites had third party certification for the ISO 14001 standard.
	SSAB's operations are subject to environmental permits containing numerous environmental conditions governing various parameters regarding production levels, air emissions, discharge water effluent, and waste management. SSAB records all environmental damage and other environmental non-compliances and reports them to the appropriate authorities.
Goals and targets	SSAB's sustainability strategy includes environmental targets related to CO2 emissions and circularity (use of recycled steel and slag utilization). Read more in SR 49.
Responsibilities	SSAB's Executive Vice President and Head of Technical Development is responsible for environmental issues (including climate change). He also has a seat on the Board of HYBRIT Development AB, a joint venture aiming for fossil-free steel making. To support work related to environmental issues, SSAB has Environmental Councils, which include representatives from divisions, main production sites and from SSAB's subsidiaries, Ruukki Construction and Tibnor. Divisions, subsidiaries and sites are responsible for putting environmental protection into practice. Each production site has an environmental team or manager responsible for monitoring compliance with legislation and handling permits. Internal and external audits at sites ensure that everyday practices comply with set targets.
Specific actions	SR 76, 78
Main risks related to the topic	Environmental risks are included in the enterprise risk management process. Emissions from normal operating conditions are controlled and subject to environmental permit limits. Regular risk assessments cover possible emissions in the event of disruption or accident. The results of this assessment serve as the basis for preventive measures and corrective actions at the relevant levels. The main environmental risks are reported in FR 149–156.
Monitoring the effectiveness of our approach	SSAB ensures continuous development by monitoring environmental performance against environmental targets and the environmental management system. SSAB conducts external audits regularly at all sites to verify continuous improvements according to the ISO standards.
Topic boundaries	SSAB's production sites. SR 95 for more information on sites included in the environmental data.

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Leading sustainability performance

Efficiency & Responsibility: Responsible sourcing
Material topics	Social and environmental responsibility at suppliers
Why the topic is material	SSAB has an extensive supply chain of approximately 20,000 active suppliers in more than 60 different countries. At SSAB, sustainability is an integrated aspect of sourcing operations and supply chain management. Suppliers must comply both with SSAB's own standards and with international social and environmental guidelines in order to remain qualified suppliers for SSAB. We assess suppliers based on quality, delivery reliability, cost and sustainability.
GRI material topics	GRI 414: Supplier social assessment
SDG	5, 7, 9, 12, 13, 16
Reported GRI indicators	414–1 New suppliers that were screened using social criteria
Policies, management systems	SSAB has a Supplier Sustainability Policy based on the UN Global Compact principles to which SSAB is a signatory. The Supplier Sustainability Policy applies to all suppliers providing products and/or services to any SSAB group company and includes requirements on labor and human rights, health and safety, anti-corruption and the environment. Read more in SR 82.
Commitments	UN Global Compact
Goals and targets	SSAB has set targets and KPIs to ensure supplier compliance with SSAB's Supplier Sustainability Policy. Read more SR 50, 82.
Responsibilities	SSAB's Chief Procurement Officer is responsible for sourcing related issues. SSAB has a procurement council, whose mission is to enhance global procurement processes and projects, and to collaborate on sustainability and continue our strong focus on responsible sourcing.
Specific actions	Read about identification and evaluation of supplier risks, supplier audits, site visits and other actions taken in SR 83.
Main risks related to the topic	Failure or disruption at key suppliers of input materials is is one of the main internal risks identified for SSAB. Read more in the risks section in FR 149–156.
Monitoring the effectiveness of our approach	SSAB assesses the impact of our processes and tools concerning responsible sourcing. We have a systematic method for supplier sustainability assessment. Based on the supplier sustainability risk assessment, we may request that our suppliers self-assess their sustainability performance and management. The self-assessment may lead to a supplier audit conducted by an independent third party and SSAB. With the process, we aim to enhance risk management and ensure compliance with our Supplier Sustainability Policy.
Topic boundaries	SSAB's suppliers

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Respect and Integrity

Zero tolerance for bribery and corruption
Material topics	Business ethics
Why the topic is material	In today's globalized world, anti-corruption and business ethics have become increasingly important for companies. Failure to address corruption, bribery and other issues related to business ethics could have negative impacts on the company's reputation and brand and increase the risk for financial sanctions.
GRI material topics	GRI 205: Anti-corruption
SDG	16
Reported GRI indicators	205-2 Communication and training about anti-corruption policies and procedures
Policies, management systems	SSAB's governing document for anti-corruption and business ethics define SSAB's zero tolerance approach to bribery and corruption, and sets out guidance for our daily operations. • Group wide Code of Conduct
	• Instructions regarding anti-corruption providing information on how SSAB defines bribery and improper benefits, and how employees are expected to act in relation to suppliers, customers and other business partners
	• Instructions for review of business partners describing the risk assessment process for reviewing business partners within risk areas for corruption
	• Instructions regarding the Ethics Line defining complaint procedures and explaining how a report is investigated.
	SSAB has a learning management system in place to ensure that employees are trained on our policies and critical business ethics aspects and has implemented a global whistleblower-reporting tool, the Ethics Line. Read more in SR 86.
Commitments	UN Global Compact, International Bill of Human Rights, the ILO Core Conventions and the OECD Guidelines for Multinational Enterprises, the UN Guiding principles on business and human rights and the UN Sustainable Development Goals all include provisions related to business ethics.
Goals and targets	SSAB has set targets to ensure ethical conduct in line with SSAB´s corporate culture and to increase knowledge about the Code of Conduct and Ethics Line. Read more in SR 51
Responsibilities	SSAB has an Ethics and Compliance function, which includes strategic responsibility for business ethics, anti-corruption and human rights, as well as for implementing new legislation and international guidelines in this area. Read more in SR 84
Specific actions	Essential components of the ethics and compliance program are risk assessments and employee training to prevent and detect corruption and mitigate legal and ethical risks. Read more in SR 85
Main risks related to the topic	Risks related to anti-corruption and business ethics are described in the risks section in FR 149–156.
Monitoring the effectiveness of our approach	SSAB measures progress and effectiveness by assessing the following: • Share of employees who have access to the Ethics Line
	• Share of new employees covered by onboarding process (including signing the Code of Conduct statement and e-learning in business ethics)
	• Share of employees who have completed global e-learning in business ethics.
	Read more in SR 84
Topic boundaries	SSAB Group, SSAB's suppliers and partners

BUSINESS REVIEW	SUSTAINABILITY REPORT	CORPORATE GOVERNANCE REPORT	FINANCIAL REPORTS 2020

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Respect and Integrity

We are inclusive and diverse
Material topics	Inclusion and Diversity
Why the topic is material	For us, a diverse workforce provides a wide range of abilities, competences and experience. Diversity means heterogeneity of our workforce including age, gender, race, ethnicity, physical abilities, political and religious beliefs, and other attributes.
	We strive for inclusion to ensure the full and equal participation of everyone across the full spectrum of diversity within the organization.
GRI material topics	GRI 405: Diversity and equal opportunity
SDG	5, 16
Reported GRI indicators	405-1 Diversity of governance bodies and employees
Policies, management systems	At SSAB, we expect our leaders to continuously strive to create an inclusive workplace and to build a diverse workforce – for the good of our culture, increased engagement and to drive our overall performance and results as a high-performing organization.
Commitments	The ILO Declaration on Fundamental Principles and rights at Work
Goals and targets	SSAB is aiming to increase the number of women in top management positions. Read more in SR 51.
Responsibilities	The Human Resources function defines and guides the processes surrounding competence and leadership development, diversity and inclusion, compensation and benefits, and other human resource related topics. • Executive Vice President and Head of People, Culture and Communication is responsible for Human Resources at SSAB; she is a member of the SSAB Group Executive Team and reports to the CEO.
	• VP and Head of Group HR Compliance and Operations is responsible for processes related to talent attraction and development, including learning programs, talent reviews and successor plans. She is also responsible for processes related to diversity and inclusion.
Specific actions	Read about projects and actions taken to strengthen inclusion and diversity in SR 88.
Main risks related to the topic	Main risks regarding employee related issues are described in the risks section in FR 149–156.
Monitoring the effectiveness of our approach	We assess the impact of our processes and tools on human resources related topics. We use regular assessment and reporting tools, including our employee engagement survey, performance dialogs, HR reporting to enhance the positive impacts and to avoid, mitigate and remediate any negative impacts on our material topics.
Topic boundaries	SSAB Group

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GRI index

This report has been prepared in accordance with the GRI Standards: Core option. Topic-specific Standards are reported with respect to the material topics for SSAB. This table specifies where you will find more information on the sustainability disclosures. The report also constitutes Communication on Progress (CoP) reporting to the UN's Global Compact.

BR = Business Review 2020 SR = Sustainability Report 2020 CGR = Corporate Governance Report 2020 FR = Financial Reports 2020

Code		Description	Location in the report	Comments and omissions
GRI 102: General disclosures
Organizational profile	102-1	Name of the organization	See comments	SSAB AB
	102-2	Activities, brands, products, and services	BR 12, 28–42
	102-3	Location of headquarters	See comments	Stockholm
	102-4	Location of operations	BR 13
	102-5	Ownership and legal form	See comments	SSAB AB is a public company. SSAB is listed on the NASDAQ Stockholm and NASDAQ Helsinki exchanges.
	102-6	Markets served	BR 13, 22
	102-7	Scale of the organization	BR 9, 14; FR 135
	102-8	Information on employees and other workers	SR 87–92	SSAB does not hold information about external staff/ contractors in its global reporting system.
	102-9	Supply chain	BR 17, SR 54, 81
	102-10	Significant changes to the organization and its supply chain	SR 95
	102-11	Precautionary Principle or approach	FR 149–156
	102-12	External initiatives	SR 63, 85, 97
	102-13	Membership of associations	SR 100
Strategy	102-14	Statement from senior decision-maker	BR 5–6
Ethics and integrity	102-16	Values, principles, standards, and norms of behavior	BR 15, 16; SR 84

Code		Description	Location in the report	Comments and omissions
Governance structure	102-18	Governance structure	CGR
Stakeholder	102-40	List of stakeholder groups	SR 98
engagement	102-41	Collective bargaining agreements	SR 93
	102-42	Identifying and selecting stakeholders	SR 98
	102-43	Approach to stakeholder engagement	SR 98
	102-44	Key topics and concerns raised	SR 98–99
Reporting practice	102-45	Entities included in the consolidated financial statements	FR 196	The entities included in SSAB's Consolidated Financial Statements are listed in Note 8 to the Consolidated Financial Statements.
	102-46	Defining report content and topic boundaries	SR 97–102
	102-47	List of material topics	SR 97–102
	102-48	Restatements of information	See comments	No restatements
	102-49	Changes in reporting	See comments	The material topics included in SSAB's 2020 reporting are based on the new materiality analysis conducted in 2019. The list of material topics, their boundaries, as well as management approaches are presented in the tables p. 102–109.
	102-50	Reporting period	See comments	January 1, 2020-December 31, 2020
	102-51	Date of most recent report	See comments	March 18, 2019
	102-52	Reporting cycle	See comments	Annual
	102-53	Contact point for questions regarding the report	See comments	Christina Friborg: [email protected]
	102-54	Claims of reporting in accordance with the SR Standards	SR 95
	102-55	GRI content index	SR 110
	102-56	External assurance	SR 95, 115
GRI 103: Management	103-1	Explanation of the material topic and its boundary	SR 102–109
approach	103-2	The management approach and its components	SR 102–109
	103-3	Evaluation of the management approach	SR 102–109

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Code		Description	Location in the report	Comments and omissions
GRI 205: Anti corruption	205-2	Communication and training about anti-corruption policies and procedures	SR 84
ENVIRONMENTAL STANDARDS
GRI 301: Materials	301-1	Materials used by weight or volume	SR 76
	301-2	Recycled input materials used	SR 76–77
GRI 302: Energy	302-1	Energy consumption within the organization	SR 79
	302-3	Energy intensity	SR 78
	302-4	Reduction of energy consumption	SR 78
GRI 305: Emissions	305-1	Direct (Scope 1) GHG emissions	SR 71, 73
	305-2	Energy indirect (Scope 2) GHG emissions	SR 72–73
	305-3	Other indirect (Scope 3) GHG emissions	SR 72–73
	305-4	GHG emissions intensity	SR 73
	305-5	Reduction of GHG emissions	SR 71
	305-7	Nitrogen oxides (NOX), sulfur oxides (SOX), and other significant air emissions	SR 75
GRI 306: Effluents and waste	306-2	Waste by type and disposal method	SR 77	At a group level information on disposal methods is not available. Reporting is being developed and the aim is to report it in the coming years.
SOCIAL STANDARDS
GRI 401: Employment	401-1	New employee hires and employee turnover	SR 91

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Code		Description	Location in the report
GRI 403: Occupational	403-1	Occupational health and safety management system	SR 67–68
health and safety	403-2	Hazard identification, risk assessment, and incident investigation	SR 67–68
	403-3	Occupational health services	SR 70
	403-4	Worker participation, consultation, and communication on occupational health and safety	SR 67–68
	403-5	Worker training on occupational health and safety	SR 69
	403-6	Promotion of worker health	SR 70
	403-7	Prevention and mitigation of occupational health and safety impacts directly linked by business relationships	SR 69
	403-9	Work-related injuries	SR 70
GRI 404: Training and education	404-2	Programs for upgrading employee skills and transition assistance programs	SR 89
	404-3	Percentage of employees receiving regular performance and career development reviews	SR 90
GRI 405: Diversity and equal opportunity	405-1	Diversity of governance bodies and employees	SR 92
GRI 414: Supplier social assessment	414–1	New suppliers that were screened using social criteria	SR 82

Sustainability disclosures

All of the sustainability disclosure requirements in the Swedish Annual Accounts Act are covered by the GRI Disclosures and the table specifies where they are found in the Annual Report.

Sustainability disclosures
Business model	Environmental matters	Social and employee related matters	Protection of human rights	Anti-corruption
Business Review	SR 48–49, 57–65, 71–80, 102–104, 106, 114	SR 50, 51, 67–70, 87–92, 109	SR 50–51, 93, 82–83, 105, 107	SR 51, 84–86, 108

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Climate-related financial disclosures (TCFD) index

The Financial Stability Board's (FSB) Task Force on Climate-related Financial Disclosures (TCFD) recommends a framework for disclosing climaterelated risks and opportunities that goes beyond current practices. In the index table below, we list our disclosures with reference to TCFD recommendations, and refer to the locations where these issues are addressed in our annual reporting.

While climate related matters are highly prioritized within SSAB and in our fossil-free 2045 agenda, we acknowledge that our reporting inline with TCFD is not yet complete. We continue to implement the recommendation step-by-step.

Area	Recommended TCFD disclosures	Source of information in SSAB's reporting /comments
Governance
Disclose the organization's	a) Describe the board's oversight of climate-related risks and opportunities.	SR 96 Sustainability governance, CGR 119 Board of Directors
governance around climate-related risks and opportunities.	b) Describe management's role in assessing and managing climate-related risks and opportunities.	SR 96 Sustainability governance, CGR 127 Group Executive Committee
Strategy
Disclose the actual and potential impacts of climate-related risks and opportunities on the organization's businesses, strategy, and financial planning where such information is material.	a) Describe the climate-related risks and opportunities the organization has identified over the short, medium, and long term.	SR 74 Transitional risks, emissions trading and increasing carbon costs, Physical risks caused by climate change, FR 149–156 Risk management, SR 63 Fossil-free steel
	b) Describe the impact of climate-related risks and opportunities on the organization's businesses, strategy, and financial planning.	SR 74 Transitional risks, emissions trading and increasing carbon costs, Physical risks caused by climate change, FR 149–156 Risk management, SR 63 Fossil-free steel
	c) Describe the resilience of the organization's strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario.	SSAB has not proceeded yet to the scenario work.
Risk Management
Disclose how the organization identifies,	a) Describe the organization's processes for identifying and assessing climate-related risks.	SR 96 Sustainability governance, FR 149–156 Risk management
assesses, and manages climate-related risks.	b) Describe the organization's processes for managing climate-related risks.	SR 96 Sustainability governance, FR 149–156 Risk management
	c) Describe how processes for identifying, assessing, and managing climate related risks are integrated into the organization's overall risk management.	SR 96 Sustainability governance, FR 149–156 Risk management
Metrics & Targets
Disclose the metrics and targets used to assess and manage relevant climate-related risks and	a) Disclose the metrics used by the organization to assess climate related risks and opportunities in line with its strategy and risk management process.	SR 46, 48–49 Sustainability strategy and targets, SR 71 CO2 efficient steel production
opportunities where such information is material.	b) Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas (GHG) emissions, and the related risks.	SR 71–73 CO2 efficient steel production
	c) Describe the targets used by the organization to manage climate related risks and opportunities and performance against targets.	SR 48–49 Sustainability strategy and targets, SR 71 CO2 efficient steel production

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CORPORATE GOVERNANCE REPORT 2020 BOARD OF DIRECTORS GROUP EXECUTIVE COMMITTEE

Auditor's Combined Assurance Report on SSAB AB (publ)'s Sustainability Report and statement regarding the Statutory Sustainability Report

This is the translation of the auditor's report in Swedish.

To SSAB AB (publ), corp id 556016-3429

Introduction

We have been engaged by the Board of SSAB AB (publ) to undertake a limited assurance engagement of SSAB AB (publ)'s Sustainability Report for the year 2020. The scope of the Sustainability Report has been defined on p. 110–113. The Statutory Sustainability Report is defined on p. 113.

Responsibilities of the Board and Executive Management

The Board of Directors and Executive Management are responsible for the preparation of the Sustainability Report including the Statutory Sustainability Report in accordance with applicable criteria and the Annual Accounts Act respectively. The criteria are defined on page 95 in the Sustainability Report and are part of the Sustainability Reporting Guidelines published by GRI (The Global Reporting Initiative) that are applicable to the Sustainability Report, as well as the accounting and calculation principles that the Company has developed. This responsibility includes the internal control relevant to the preparation of a Sustainability Report that is free from material misstatements, whether due to fraud or error.

SSAB ANNUAL REPORT 2020

Responsibilities of the auditor

Our responsibility is to express a conclusion on the Sustainability Report based on our limited assurance procedures and to express an opinion regarding the Statutory Sustainability Report. Our engagement is limited to historical information presented in this document and does therefore not include future oriented information.

We have conducted our engagement in accordance with ISAE 3000 Assurance engagements other than audits or reviews of historical financial information. A limited assurance engagement consists of making inquiries, primarily of persons responsible for the preparation of the Sustainability Report, and applying analytical and other limited assurance procedures. Our examination regarding the Statutory Sustainability Report has been conducted in accordance with FAR's accounting standard RevR 12 The auditor's opinion regarding the statutory sustainability report. A limited assurance engagement and an examination according to RevR 12 are different from and substantially less in scope than reasonable assurance conducted in accordance with IAASB's Standards on Auditing and other generally accepted auditing standards in Sweden.

The firm applies ISQC 1 (International Standard on Quality Control) and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We are independent of SSAB AB (publ) in accordance with professional ethics for accountants in Sweden and have otherwise fulfilled our ethical responsibilities in accordance with these requirements.

The procedures performed in a limited review and an examination according to RevR 12 do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in a reasonable assurance engagement. The conclusion based on limited assurance procedures and an examination according to RevR 12 does not provide the same level of assurance as a conclusion based on reasonable assurance.

Our procedures are based on the criteria defined by the Board of Directors and the Executive Management as described above. We consider these criteria suitable for the preparation of the Sustainability Report.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our conclusion below.

Conclusions

Based on the limited assurance procedures we have performed, nothing has come to our attention that causes us to believe that the Sustainability Report is not prepared, in all material respects, in accordance with the criteria defined by the Board of Directors and Executive Management.

A Statutory Sustainability Report has been prepared.

Stockholm, 1 March 2021

Ernst & Young AB

Accountant

Rickard Andersson Outi Alestalo

Authorized Public Expert member of FAR

SSAB ANNUAL REPORT 2020

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CORPORATE GOVERNANCE REPORT

Corporate Governance Report 2020	117
Board of Directors	121
Group Executive Committee	125

CORPORATE GOVERNANCE REPORT 2020

BOARD OF DIRECTORS GROUP EXECUTIVE COMMITTEE

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Corporate Governance Report 2020

SSAB's organization is characterized by a way of working in which responsibilities and powers are largely delegated to the respective divisions and subsidiaries. SSAB's share is listed on NASDAQ Stockholm and has a secondary listing on NASDAQ Helsinki. SSAB is governed by, among others, the NASDAQ Stockholm Rule Book for Issuers and the Swedish Corporate Governance Code (Corporate Code). This corporate governance report complies with the Swedish Annual Accounts Act and the Corporate Code, and is not part of the Report of the Board of Directors.

Organization as at December 31, 2020

SSAB is structured across three divisions: SSAB Special Steels, SSAB Europe and SSAB Americas, as well as two larger wholly-owned subsidiaries: Tibnor and Ruukki Construction. The two latter are run as independent subsidiaries.

The diagram below shows SSAB's corporate governance framework as at December 31, 2020, and how the central bodies operate.

Derogations from the Corporate Code

There are no derogations to report from the Corporate Code for 2020.

Shareholders

SSAB's share capital consists of class A and class B shares, with class A shares carrying one (1) vote and class B shares one-tenth (1/10) of a vote. Both classes of shares carry the same rights to a share in the company's assets and profits.

Important external and internal rules and policies which affect corporate governance:

Significant internal rules and policies

Articles of Association
The Board's rules of procedure, incl. instructions to the CEO and instructions to Board committees
Code of Conduct

Significant external rules

Swedish Companies Act
Swedish Book-keeping Act
Swedish Annual Accounts Act
Rules of NASDAQ Stockholm and NASDAQ Helsinki, www.nasdaqomxnordic.com
Swedish Corporate Governance Code, www.corporategovernanceboard.se

As at December 31, 2020, there were a total of 121,136 shareholders. Industrivärden was the largest shareholder in terms of voting rights, followed by LKAB, Solidium Oy, Lannebo Funds, Vanguard, Folksam, BlackRock, Carnegie Funds, Svea Ekonomi AB and Dimensional Fund Advisors. The ten largest identified owners together owned approximately 41.9% of the votes and 34.9% of the capital at the end of December 2020. Owners outside Sweden and Finland accounted for 29.6% of votes and 21.5% of the capital. See Shares and shareholders for more information about the ownership structure.

General meeting

The general meeting of shareholders is the company's highest decision-making body and is where owners exercise their shareholder power. At the Annual General Meeting (ordinary general meeting), the shareholders resolve, among other things, the following:

Adoption of the annual report and consolidated financial statements
Allocation of the company's profit/loss
Discharge from liability for the Board of Directors and the CEO
Election of the Board of Directors, its chairman and the auditors
Method of appointment of the Nomination Committee ( when applicable)
Remuneration of the Board of Directors and the auditors
Guidelines for the remuneration to the CEO and other senior executives ( when applicable)

2020 Annual General Meeting

The 2020 Annual General Meeting adopted the annual report and consolidated financial statements for 2019 released by the Board of Directors and the CEO, decided on the allocation of the company's profit and granted the directors and CEO discharge from liability. In addition, the Chairman of the Nomination Committee presented the Committee's work during the year and the rationale behind the proposals presented. The general meeting decided on the remuneration to the Board and the auditors in accordance with the Nomination Committee's proposals. It was further resolved that the Board will comprise eight directors and accordingly Bo Annvik, Petra Einarsson, Marika Fredriksson, Marie Grönborg , Bengt Kjell (who was elected Chairman of the Board), Pasi Laine, Martin Lindqvist (President and CEO), were re-elected as Board members. Annareetta Lumme-Timonen was elected as new Board member. Matti Lievonen had declined re-election to the Board.

Upon proposal by the Nomination Committee, it was decided that the number of auditors should be one registered auditing company and Ernst & Young AB was reelected as auditors for one year until the Annual

Owners as of December 31, 2020

	% of votes	% of capital
Industrivärden	11.77	4.31
LKAB	10.5	10.5
Solidium Oy	9.8	12.6
Lannebo Funds	2.5	1.2
Vanguard	2.4	2.2
Folksam	1.2	1.2
BlackRock	1.1	1.1
Carnegie Funds	1.1	0.4
Svea Ekonomi AB	0.9	0.6
Dimensional Fund Advisors	0.8	0.9
Other shareholders	58.1	65.1
Total	100.0	100.0
Whereof foreign-registered shareholders*	29.6	21.5

* Includes shareholders outside Sweden and Finland Source: Modular Finance

General Meeting 2021. The Board of Director's revised proposal pursuant to the allocation of the company's earnings was presented to the Annual General Meeting. In accordance with the proposal by the Board of Directors and the CEO it was resolved that no dividends should be paid for the financial year 2019. The General Meeting resolved in accordance with the Board's proposal on remuneration guidelines for senior executives. The General Meeting also resolved on a new instruction for the Nomination Committee.

Finally, the General Meeting resolved to authorize the Board of Directors to, at one or several occasions up to the next Annual General Meeting, resolve on new issues of shares of series B, with or without the disapplication of the shareholders' preferential rights to subscribe for shares. The total number of shares that may be issued by exercise of the authorization shall be within the limits of the Articles of Association and not exceed ten (10) percent of the total number of shares in the company.

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In order to limit the number of participants present at the Annual General Meeting and thereby reduce the risk of spreading the Covid-19, the Board was represented only by the Chairman of the Board. For the same reason the company's CEO was attending by phone. The principal auditor was present at the meeting. The minutes of the Annual General Meeting may be viewed at www.ssab.com.

Nomination committee

Duties of the Nomination Committee

The duties of the Nomination Committee include proposing to the Annual General Meeting a chairman of the Board of Directors, directors, auditors, a Chairman of the Annual General Meeting, Board fees and auditor fees.

Procedure for the appointment of the Nomination Committee

The 2012 Annual General Meeting adopted a procedure regarding the appointment of the Nomination Committee. The procedure applies until amended through a resolution adopted at a future Annual General Meeting. The procedure was adopted with some minor adjustments by the Annual General Meeting held on April 10, 2018. According to the procedure, the Chairman of the Board is tasked with requesting that no fewer than three and no more than five of the largest shareholders in terms of votes each appoint a member to constitute the Nomination Committee together with the Chairman of the Board.

At the 2020 Annual General Meeting, a new instruction was adopted for the Nomination Committee. The changes compared with the previous version mainly relate to how any conflicts of interest in the Nomination Committee are to be handled, and how the Nomination Committee is to act when a shareholder who has appointed a member has sold parts of his holding of SSAB shares and no longer constitutes one of the major shareholders.

There may be no more than six members in total. The member representing the largest shareholder in terms of votes shall be Chairman of the Nomination Committee. The composition of the Nomination Committee was announced on www.ssab.com on August 20, 2020. Shareholders were able to submit proposals to the Nomination Committee by, for example, email, until December 31, 2020. The Nomination Committee's proposals will be published no later than in conjunction with the notice of the Annual General Meeting.

In connection with the issuance of the notice of the Annual General Meeting, the Nomination Committee will publish a reasoned statement regarding its proposal for a Board on www.ssab.com.

Nomination committee ahead of the 2021 Annual General Meeting

Appointed by, name	Share (%) of votes at 31 december 2020
Lars Pettersson, Industrivärden (Chairman of the Nomination Committee)	11.8
Pierre Heeroma, LKAB	10.5
Petter Söderström, Solidium Oy	9.8
Charlotta Faxén, Lannebo Funds	2.5
Bengt Kjell (Chairman of the Board of Directors)	-

Work of the Nomination Committee ahead of the 2021 Annual General Meeting

The Nomination Committee has convened three times in 2020 since it was appointed in August 2020. Additional meetings are planned before the Annual General Meeting.

The Board's evaluation process and the outcome of the evaluation was presented at the Nomination Committee's meeting in October. Further, the outcome of the evaluation of the Chairman of the Board was presented for the Nomination Committee.The Nomination Committee has discussed the composition of the Board, and agreed on the fundamental Board member requirements, including the requirements on independent members. The Nomination Committee particularly took into account in its Board proposal, the need for diversity and breadth, and the requirements to strive for gender balance on the Board.

The Nomination Committee engages in continuous work in identifying and evaluating potential new directors. In submitting proposals for fees to the Board of Directors and its committees, the Nomination Committee, among other things, conducted an overview of Board fees in similar companies. Prior to the election of an auditor at the Annual General Meeting 2021, the Audit Committee has conducted an evaluation of the audit performance presented to the Nomination Committee on its December meeting. At the same meeting, the committee's recommendation regarding both election of auditors and fees was presented. The Nomination Committee followed the Audit Committee's recommendation when presenting its proposals to the 2021 Annual General Meeting.

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Board of directors

Responsibilities of the Board

The overall task of the Board of Directors is to manage the company's affairs in the best interests of both the company and its shareholders. The Board must regularly assess the group's financial position and evaluate the operative management. The Board decides, among other things, on matters concerning the group's strategic focus and organization, and decides on important capital expenditure (exceeding SEK 100 million).

When applicable, the Board prepares proposals for guidelines regarding the determination of salary and other remuneration to the CEO and other members of the company's senior management for decision at the Annual General Meeting.

Rules of procedure of the Board

Each year, the Board adopts the rules of procedure, including instructions to the CEO, which, among other things, govern the allocation of work between the Board and the CEO.

The rules of procedure further regulate the frequency of Board meetings and the allocation of work among the Board's committees. The rules of procedure state that there must be a Remuneration Committee and an Audit Committee. Ahead of each Board meeting, the directors receive a written agenda and full documentation to serve as the basis for decisions. Each Board meeting conducts a review of the group's accident statistics, the current state of the business, the group's results, financial position and prospects. Other issues addressed include competition and the market situation. The Board also regularly monitors health and safety work.

Chairman of the Board

The chairman of the Board of Directors presides over the Board's work, represents the company on ownership issues and is responsible for the evaluation of the work of the Board. In addition, the Chairman of the Board of Directors is responsible for regular contact with the CEO and for ensuring that the Board of Directors performs its duties.

Composition of the Board

Under the Articles of Association, the Board of Directors consists of a minimum of five and a maximum of ten members elected by the general meeting. The Board is quorate when more than half of the total number of directors is present. Taking into consideration the company's operations, phase of development and circumstances in general, the Board must have an appropriate composition which is characterized by diversity and breadth as regards the competence, experience and background of its members. New directors undergo an introduction course to rapidly acquire the knowledge expected in order to best promote the interests of the company and its shareholders.

The Board of Directors' diversity policy

SSAB works actively to further diversity within the company. As a part of this work, the company, through the Nomination Committee, applies rule 4.1 in the Swedish Corporate Governance Code (the Corporate Code) as its diversity policy. In accordance with rule 4.1 in the Corporate Code, the Board is to have a composition appropriate to the company's operations, phase of development and other relevant circumstances. The Board members elected by the shareholders' meeting are collectively to exhibit diversity and breadth of qualifications, experience and background. The company is also to strive for gender balance on the Board.

The Nomination Committee shall consider the diversity policy when preparing its proposals for the election of a Board member. In addition, the Board of Directors continuously discusses the question regarding diversity within the organization. The objective of the diversity policy is to cater the importance of sufficient diversity within the Board in order to encourage independent opinions and a critical approach which will contribute to efficient Board work in the company.

During the financial year 2020, the Board of Directors' diversity policy has mainly been implemented and applied in connection with the Nomination Committee's work ahead of the 2020 Annual General Meeting and the 2021 Annual General Meeting. This has resulted in a diversified and appropriate Board composition with Board members that possess the qualifications and experience required for SSAB's operations.

Work of the Board in 2020

In 2020, the Board of Directors held 14 meetings at which minutes were taken and at which the Board was quorate at all times. SSAB's General Counsel, who is not a director, served as secretary to the Board.

Safety work has top priority across the group and at every meeting the Board keeps close track of the accident and injury frequency and the corrective actions implemented by the company. The Board also follows the company's sustainability performances with regular follow-ups of achievements of the targets set out. The first quarter of 2020 was marked by a slight recovery due to a weaker fourth quarter in 2019. The Covid-19 virus had significantly started to spread in Europe by the end of the first quarter, and the spread worsened dramatically during the second quarter when also the American continent got affected. The effects of the virus spread brought negative consequences for principle all SSAB's customer segments, where the standard steel segments were particularly exposed for volume- and downward pressure on prices. After a somewhat calmer summer, the virus spread increased once again during the fall bringing new uncertainty on the global steel market as a consequence. The Board's focus during the greater part of 2020 has therefore been to monitor the company's work with handling the stressed steel market with cost-saving measures, including production and staff adjustments.

Alongside the work to mitigate the effects of Covid-19, the company's strategic development efforts has naturally continued, albeit to somewhat smaller format. The Board monitors the strategic work as well as the company's key operating challenges such as methods and ways of working for continuous improvement in productivity. In addition to this, the Board has also addressed matters concerning digitalization, IT security, R&D, control functions, corporate governance etc.

An external consultant was engaged to carry out the annual evaluation of the Board. As a first step in the evaluation, each Board Member responded to a relatively wide questionnaire. The Member's responses and comments where thereafter compiled, and constituted the basis for the evaluation discussion taking place on the Board meeting in October. The external consultant presented the evaluation process and the outcome of the evaluation on the Nomination committee meeting in October.

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Board of Directors – appointed by the annual general meeting

BENGT KJELL (1954)	BO ANNVIK (1965)	PETRA EINARSSON (1967)	MARIKA FREDRIKSSON (1963)	MARIE GRÖNBORG (1970)	PASI LAINE (1963)
Chairman since 2015 MBA, Stockholm School of Economics Nationality: Swedish	MSc (Eng.) Business Administration. Nationality: Swedish	BSc (Business Administration and Economics) Nationality: Swedish	MBA Nationality: Swedish	MSc (Eng.) Chemical Engineering Nationality: Swedish	MSc (Eng.) Nationality: Finnish
Elected to the board
2015 Shareholding1)	2019	2014	2016	2019	2017
40,000 B shares	0	18,750 B shares	1,000 B shares	0	712 A shares, 4,931 B shares
Current appointments
Board Chairman: Amasten Fastighets AB Vice Chairman of the Board: Indutrade AB and Pandox AB Director: AB Industrivärden	Board Chairman: Abdon Group President and CEO: Indutrade AB	Director: Alimak Group AB	CFO & Group Executive Vice President: Vestas Wind Systems A/S (since 2013) Director: Sandvik AB and AB Industrivärden	President and CEO: Purac AB Director: Permascand Top Holding AB	President and CEO of Valmet Oyj (since 2013) Director: Ilmarinen Mutual Pension Insurance Company
Previous appointments
Acting President: AB Industrivärden CEO: AB Handel och Industri Vice President: AB Industrivärden Senior partner: Navet AB Board Chairman: Kungsleden AB, Skånska Byggvaror Holding AB, Nyfosa AB and Hemfosa Fastigheter AB Director: Höganäs AB, Skanska AB, Munters AB, ICA Gruppen AB and SSM Holding AB 1) Shareholdings include shares owned by closely-related persons	President and CEO: Haldex AB Senior positions: Volvo Cars, SKF and Outokumpu	CEO: BillerudKorsnäs AB Business Area Manager: Sandvik Materials Technology Product Area Manager Tube: Sandvik Materials Technology Product Area Manager Strip: Sandvik Materials Technology CFO: Sandvik Materials Technology Director: Swedish Association of Industrial Employers and Confederation of Swedish Enterprise Member of the Council: Swedish Steel Producers' Association	Director: ÅF AB CFO: Gambro AB, Autoliv Inc. (Stockholm, Sweden), Volvo Construction Equipment (Brussels, Belgium) and Volvo Construction Equipment International AB	EVP: Perstorp Group, Business Area Specialties & Solutions Senior positions: Perstorp Group och Formox AB	Director: HKScan Oyj and Tamfelt Oyj Several senior positions: Metso group, including President of Pulp, Paper and Power Technology, President of Metso Automation

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Board of Directors – appointed by the annual general meeting Board of Directors – appointed by the employees

MARTIN LINDQVIST (1962)
President and CEO
BSc (Economics)
Nationality: Swedish

ANNAREETTA LUMME-TIMONEN (1967) Doctor of Science (Technology), Aalto University Nationality: Finnish

Elected to the board

2011

Shareholding1)

11,709 A shares, 21,023 B shares

142 A shares, 1,775 B shares

Current appointments

President and CEO: SSAB AB	Investment Director and member of the
(employed at SSAB since 1998)	Group Management: Solidium Oy
Chairman: Swedish Steel	Chairman of the Shareholders' Nomination
Producers Association	Board: Metso Outotec Oyj
Director: Svenska Cellulosa Aktiebolaget SCA and Swedish Association of Industrial Employers AB
Alternate: Confederation of Swedish Enterprise

2020

Previous appointments

Director: Indutrade Aktiebolag	Investment manager: 3i Nordic plc, Helsinki
Head of business area: SSAB	Director: start-up fund Vera Oy
EMEA	Director: the Finnish Sustainable
CFO: SSAB AB	Investment Forum (Finsif)
Chief controller: NCC	Sustainability Advisory Board, Aalto University

1) Shareholdings include shares owned by closely-related persons

STURE BERGVALL (1956)
Elected to the Board
2005

2015

TOMAS KARLSSON (1962) Elected to the Board

PATRICK SJÖHOLM (1965) Elected to the Board 2011

Current appointments

Electrician, SSAB Europe

Maintenance mechanic, SSAB Europe

Automation engineer, SSAB Special Steels

Alternates

MIKAEL HENRIKSSON (1961) Elected to the Board

TOMAS JANSSON (1966)

Elected to the Board 2014

TOMAS WESTMAN (1955) Elected to the Board 2015

Current appointments

2017

Furnace operator, SSAB Special Steels

Sales Coordinator, SSAB Europe

RM-coordinator, SSAB Europe

Jonas Bergstrand, EVP, Legal & Strategy, serves as secretary to the Board of Directors.

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Auditors

SSAB must have one or two external auditors, or one or two registered public accounting firms, under its Articles of Association. It was decided on the Annual General Meeting 2020 that Ernst & Young AB should be reelected auditor for the company until the Annual General Meeting in 2021. Rickard Andersson is the principal auditor.

The external audit of the financial statements of the parent company and those of the group, as well as management by the Board of Directors and the CEO, is conducted in accordance with International Standards on Auditing and Generally Accepted Auditing Practices in Sweden. The Company's principal auditor attends all meetings of the Audit Committee. The auditor attends at least one Board meeting a year, goes through the audit for the year and discusses the audit with the directors without the CEO and other members of the Company's management being present.

See Note 2 in Financial reports for information regarding the auditor's fees.

Audit committee

Duties

The Audit Committee elects a Chairman from among its members. Members of the Audit Committee are elected from Board members who are not employees of the company. At least one of the members must be competent in accounting or auditing matters.

The duties of the Audit Committee are stated in the Board's rules of procedure. The Chairman of the Audit Committee is responsible for ensuring that the entire Board is kept regularly informed about the Committee's work and, where necessary, must submit matters to the Board for decision. The main task of the Audit Committee is to support the Board in its work to ensure the quality of financial reporting.

	Attendance statistics 2020				Independent of
Member of the board	Elected to the board	Board meetings	Remuneration Committee	Audit Committee	The company and its management	The company's largest shareholders

Elected by the AGM1)
Bengt Kjell, Chairman since 2015	2015	14	3	4	Yes	No, Board member of Industrivärden
Bo Annvik	2019	14	2		Yes	Yes
Petra Einarsson	2014	14	3	4	Yes	Yes
Marika Fredriksson	2016	14		6	Yes	No, Board member of Industrivärden
Marie Grönborg	2019	14		6	Yes	Yes
Pasi Laine	2017	14			Yes	Yes
Annareetta Lumme Timonen2)	2020	9		4	Yes	No, member of the management group of Solidium Oy
Martin Lindqvist, President and CEO	2011	14			No, CEO at the company	Yes
Employee representatives
Sture Bergvall	2005	14			-	-
Tomas Karlsson	2015	14			-	-
Patrick Sjöholm	2011	14			-	-
Alternate members
Mikael Henriksson	2017	14			-	-
Tomas Jansson	2014	14			-	-
Tomas Westman	2015	14			-	-

1) Information about fees, see Note 2 in Financial reports

2) Elected new board member on the Annual General Meeting on the 1th of April 2020

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The Audit Committee oversees the company's internal control and risk management regarding financial reporting. The Audit Committee also assists the company's Nomination Committee with preparing proposals for a general meeting resolution on the election of auditors.

The Committee regularly meets the company's auditors, evaluates the audit work and establishes guidelines as to which additional services the company may source from its external auditors. Such additional services, up to a maximum of SEK 100,000 per assignment, must be approved in advance by the company's Chief Financial Officer. Assignments exceeding SEK 100,000 must be approved in advance by the chairman of the Audit Committee. All additional services must be reported to the Audit Committee each quarter.

The company has an established risk management process based on the company's processes and flows. In this process, the Audit Committee reviews and takes into account the risk areas that have been identified (both commercial risks and risks of errors in financial reporting). Based on the outcome of the internal and external risk assessment, the Committee regularly analyzes the focus and scope of the audit with the company's external and internal auditors.

Each year, the Audit Committee adopts an internal audit plan which, among other things, is based on the risks that have arisen in the risk management process described above. The audit plan is discussed with the external auditors in order to enhance the efficiency and quality of regular audit work. The head of Internal Audit presents conducted audits and any "whistleblowers" that have been reported to the Audit Committee. The Audit Committee also analyzes and elucidates significant accounting issues affecting the group.

Work in 2020

During 2020 great focus for the Audit Committee has been the company's liquidity and funding matters, with respect to the uncertainty Covid-19 has caused to the financial markets. Also, IT-security and the company's tax position, including the ongoing tax audit in Sweden, are other matters which the Committee has placed great emphasis to during the year. The Audit Committee took part of, and analyzed together with the external auditors, the risk analysis and audit plan which the auditors had established constituting the basis for the statutory audit.

The Audit Committee's members were since the Annual General Meeting Petra Einarsson (Chairman), Marika Fredriksson, Marie Grönborg, Bengt Kjell and Annareetta Lumme-Timonen. In 2020, the Audit Committee held six meetings at which minutes were taken.

Remuneration committee

Duties

In addition to the Chairman of the Board of Directors, the Remuneration Committee comprises one or more directors, who must normally be independent both of the company and of the company's top management, elected by the general meeting. Members of the Remuneration Committee must possess the required knowledge and experience of remuneration matters relating to senior executives. The CEO attends the Committee meetings to report on matters. The Remuneration Committee's duties are stated in the Board's rules of procedure. The Remuneration Committee submits proposals to the Board of Directors regarding the CEO's salary and other employment terms and conditions, sets salaries and employment terms for other members of the Group Executive Committee, and sets limits regarding the salary and employment terms and conditions for other senior executives. The Remuneration Committee's duties otherwise include preparing resolutions for adoption by the Board on issues concerning remuneration principles, preparing the Board's proposal for guidelines to determine the salary and other remuneration of the CEO and other members of the company's senior management, as well as monitoring and evaluating the application thereof. The Remuneration Committee also monitors and evaluates programs regarding variable remuneration of the company's senior management.

Work in 2020

During 2020, the Remuneration Committee held three meetings at which minutes were taken. The Remuneration Committee comprised of Bo Annvik, Petra Einarsson and Bengt Kjell (Chairman). The CEO is co-opted to the Committee but does not participate in discussions concerning his own salary and employment terms and conditions.

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Group Executive Committee

MARTIN LINDQVIST (1962)	OLAVI HUHTALA (1962)	CHARLES SCHMITT (1959)	JOHNNY SJÖSTRÖM (1974)	JONAS BERGSTRAND (1965)	HÅKAN FOLIN (1976)
President and CEO Nationality: Swedish	Executive Vice President and Head of SSAB Europe Nationality: Finnish	Executive Vice President and Head of SSAB Americas Nationality: American	Executive Vice President and Head of SSAB Special Steels Nationality: Swedish	Executive Vice President, Legal, M&A and Procurement Nationality: Swedish	Executive Vice President and CFO Nationality: Swedish
Member of the group executive committee
2001	2014	2011	2019	2006	2013
Shareholding1)
11,709 A shares	17,578 A shares	3,000 B shares	8,000 A shares	24,125 B shares	15,000 B shares
21,023 B shares	77,873 B shares
Education
BSc (Economics), Uppsala University	BSc (Engineering)	BSc (Business Administration/ Finance). The University of Texas at Arlington, two-year steel fellowship at the American Iron and Steel Institute	Master's degree in Physics, PhD in Materials Technologies, Karlstad University, Associate Professor, Luleå Technical University and EMBA Stockholm School of Economics	LLM, Uppsala University	MSc, KTH Royal Institute of Technology, Stockholm
Background
Employed at SSAB since 1998.	Employed at Rautaruukki/SSAB since 1987.	Employed at IPSCO/SSAB since 1990.	Employed at SSAB between 2012–2014 and since 2019.	Employed at SSAB since 2006.	Employed at SSAB since 2006.
Previously:	Previously:	Previously:	Previously:	Previously:	Previously:
Head of business area: SSAB EMEA	EVP: Ruukki Metals, President: Ruukki	Several positions: US Steel	President Uddeholms AB, President	Corporate counsel: ABB, OM Gruppen	CFO: SSAB APAC
Fabrication Executive roles in Sales Head of business area: SSAB Strip and Production: Rautaruukki Metform Products		Corporation and VP of the Southern Business Unit: SSAB Americas	Scana Leshan (China), VP Technology and responsible for	and Ericsson Radio Systems	CFO: Tibnor
CFO: SSAB AB,			market development SSAB APAC,		Head of Business Development: SSAB
VP Product manager Outokumpu, CFO: SSAB Strip Technology and Quality manager
Chief Controller: NCC			Outokumpu

1) Shareholdings include shares held by closely-related persons

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Group Executive Committee

MARIA LÅNGBERG (1970)	MARTIN PEI (1963)	CHRISTINA FRIBORG (1969)	EVA PETURSSON (1968)	VIKTOR STRÖMBERG (1973)
Executive Vice President and Head of People, Culture and Communication Nationality: Swedish	Executive Vice President and CTO Nationality: Swedish	Executive Vice President and Head of Sustainability, Ethics & Compliance and Health & Safety Nationality: Swedish	Executive Vice President and Head of Research and Innovation Nationality: Swedish	Executive Vice President and Head of Strategy, IT and Digitalization Nationality: Swedish
Member of the group executive committee
2016	2007	2018	2018	2018
Shareholding1)
14,000 B shares	300 A shares	6,700 B shares	165 A shares	4,000 B shares
	700 B shares		6,500 B shares
Education
BSc (Business Administration), Uppsala University	PhD, KTH Royal Institute of Technology, Stockholm	LLM, Uppsala University	Civil engineer and PhD in Steel Structures, Luleå University of	MBA, INSEAD, France and MSc in Industrial Engineering &
MBA, Stockholm School of Economics			technology	Management, Linköping University
Background
Employed at SSAB since 2013.	Employed at SSAB since 2001.	Employed at SSAB since 2018.	Employed at SSAB since 2005.	Employed at SSAB since 2011.
Previously:	Previously:	Previously:	Previously:	Previously:
President Merox and VP Group Sustainability, SSAB, EVP & Head of Group Communications, SSAB, Senior Consultant, JKL, SVP Group Communications, Gambro	EVP, Head of business area: SSAB APAC; EVP & Head of Technical Development: SSAB; General Manager Slab Production: SSAB Plate Division; Manager R&D Primary Products: SSAB Plate Division	Head of Sustainable Business at Sandvik, founder and partner at Ethos International and various positions at Sida, UNHCR and OSCE	Design specialist and research leader at SSAB Knowledge Service Center, Head of Strategic R&D at SSAB. Assistant professor in Steel Structures at Luleå University of Technology	VP and Head of Strategy at SSAB AB. Associate Partner at McKinsey & Company, product manager at SAP and consultant at IBM

1) Shareholdings include shares held by closely-related persons

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Group Executive Committee

Group Executive Committee's work and responsibilities

The Group Executive Committee is responsible for formulating and implementing the group's overall strategies and addresses matters such as acquisitions and divestments. These matters, as well as major capital expenditures (in excess of SEK 100 million), are prepared by the Group Executive Committee for decision by the Board of Directors of the parent company.

The CEO is responsible for the day-to-day management of the company in accordance with the Board of Directors' instructions and guidelines. As at December 31, 2020, the Group Executive Committee comprised, in addition to the CEO, the heads of SSAB Europe, SSAB Americas and SSAB Special Steels, the Chief Financial Officer, the Head of Legal, M&A and Procurement, the Chief Technical Officer, the Head of People, Culture and Communication, the Head of Research and Innovation, the Head of Strategy and Digitalization and the Head of Sustainability.

The Group Executive Committee holds monthly meetings to monitor the results and financial position of the group and the divisions. Other matters addressed at Group Executive Committee meetings include strategy issues and follow-up on budget and forecasts.

The head of each division is responsible for the relevant income statement and balance sheet. Overall, operational control of the divisions takes place through quarterly performance reviews. In most cases, the CEO of the parent company is the Chairman of the Board of Directors of each of the directly owned major subsidiaries such as Tibnor and Ruukki Construction, and these boards also include other members of the Group Executive Committee as well as employee representatives. Parallel with the quarterly performance reviews, the boards of the subsidiaries monitor the ongoing operations and adopt their respective strategies and budgets.

Remuneration guidelines

Guidelines for remuneration to the CEO and other senior executives were decided on the 2020 Annual General Meeting. For information of the content of the decided guidelines, see Note 2 in Financial reports.

Incentive program for senior executives

In 2011, a long-term incentive program was introduced for the entire Group. At the time the program covered a maximum of 100 (now 150) key employees, including the CEO and other senior executives. The program runs for

Group operational management structure

1) Member of Group Executive Committee

rolling three-year periods, is cash based, and linked to the total return on SSAB's share compared to a benchmark group of the company's competitors and SSAB's financial targets. The program was introduced to promote the company's ability to recruit and retain key employees. Reference is made to Note 2 in Financial reports for more information about current remuneration. The company has no share-related incentive programs.

Internal control

The overall objective of internal control is to ensure, to a reasonable degree, that the company's operational strategies and targets are monitored and that the owners' investments are protected. Internal control ensures, with reasonable certainty, that the internal and external reporting is reliable. It also ensures that the operation is carried out in accordance with applicable laws, regulations and the requirements imposed on listed companies. Internal control is the term collectively referring to the organization and its systems, processes and procedures contributing to the maintenance of control in these areas.

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Risk management

The group is tasked with seeking to ensure that risks do not materialize and, through various measures, with mitigating the fallout of any loss that occurs. Risk mapping of the group's internal and external risks is carried out as an integrated part of the annual strategy process. The result of this work is reported to the Audit Committee and to the Board of Directors. The group's Risk Management oversees and follows up both work on actively preventing the occurrence of loss at all and work on minimizing the impact of such loss should it occur. Each division and subsidiary is responsible for working proactively to prevent loss and each division has appointed risk managers participating in this work. For information on the group's work and management of sustainability and sustainability risks, see the Sustainability report.

The Board's description of internal control and risk management regarding financial reporting

Under the Swedish Companies Act and the Swedish Corporate Governance Code, SSAB's Board of Directors is responsible for internal control. The description of internal control and risk management regarding financial reporting has been prepared in accordance with the Annual Accounts Act.

Framework for internal control as regards financial reporting

SSAB's internal control is based on COSO, issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). The framework is based on five components: control environment, risk assessment, control activities, information and communication and monitoring.

Control environment

The control environment is characterized by the organizational structure, management's way of working and values, as well as other roles and responsibilities within the organization. The Audit Committee assists the Board of Directors with important accounting matters that the group applies and monitors internal control with respect to financial reporting. To maintain an efficient control environment and sound internal control, the Board has delegated practical responsibility to the CEO, who in turn has delegated responsibility to other members of the Group Executive Committee and to the CEOs of the subsidiaries.

The control environment for the financial reporting is ensured through different governing documents, such as directives and instructions. These include among others a group accounting directive. Other significant governing documents are the directives regarding financial risks and investments and authorization rules and the Code of Conduct. The governing documents are updated on a regular basis upon changes in legislation and in standards.

Work on communicating the group's Code of Conduct continued during 2020 and by the turn of 2020/2021, over 91% of the employees had completed the group's internal training module on business ethics.

Risk assessment

Risks associated with the financial reporting mainly concern accounting errors at the valuation of assets and liabilities, income and expenses and derogations from disclosure obligations. Fraud, loss/misappropriation of assets and deficiencies in business ethics are further risks assessed and managed, to, by reasonable means, ensure sound internal control of the financial reporting. SSAB's operation is characterized by processes involving well-established procedures and systems.

The overall risk assessments on group level constitutes an integrated part of the ongoing reporting to the Group Executive Committee and the Board of Directors, and it constitutes the basis of the assessment of risks for errors in the financial reporting. Financial risks, such as exchange risks, refinancing risks, counterparty risks, interest risks and credit risks are mainly managed by the parent company's treasury function, in accordance with the group's Finance Policy (see Note 29 in the Financial reports).

Control activities

The primary purpose of control activities is to prevent and identify at an early stage significant financial reporting errors so that they can be addressed and rectified. Control activities, both manual and automated, take place both at general and more detailed levels within the group. Routines and activities have been designed to manage and mitigate significant risks associated with financial reporting as identified in the risk analysis. Corrective measures, implementation, documentation and quality assurance take place at group, subsidiary or process level, depending on the nature and affiliation of the control activity. As with other processes, the relevant head is responsible for the completeness and accuracy of control activities.

Recent years have seen an in-depth analysis carried out on the processes and control structures in group companies. This has resulted in a more systematic approach to identifying financial risks and financial reporting risks, as well as documentation of controls as to how such risks are to be prevented and identified. The controls are adapted to each unit's work processes and systems structure, and these are evaluated through self-assessment supplemented with monitoring and review by internal audit. This way of working has been implemented in a system covering the entire group which is used when verifying the reliability of financial reporting.

CORPORATE GOVERNANCE REPORT 2020 BOARD OF DIRECTORS

Control activities are carried out at all levels across the group. For example, there are in every division Controller functions which analyze and follow up deviations and forward reports in the company. Monitoring by the Group Executive Committee takes place, among other things, through regular meetings with heads of divisions and subsidiaries with regard to operations, their financial position and results, as well as financial and operational

key performance indicators. The Board of Directors analyzes, on an ongoing basis, among other things, business reports in which the Group Executive Committee describes the most recent period and comments on the group's financial position and results. This is how major fluctuations and deviations are followed up to minimize the risk of errors in financial reporting.

Information and communication

SSAB has well-established information and communication procedures to support the completeness and accuracy of the financial reporting. The parent company regularly communicates updates in financial directives and instructions to all personnel concerned. In addition to this are regular group finance meetings held where the central finance functions, together with the finance managers of the divisions, processes information regarding news and changes in accounting principles, information requirements and updates within internal control. The company's intranet constitutes another important information channel within the company, where information is updated continuously and it ensures that the latest directives and instructions are always available.

The subsidiaries and the divisions regularly submits reports with analysis and comments on the financial result and risks to the Board.

The company's "whistleblower" function is another important channel of communication where accounting and internal control infringements, among other things, may be reported.

Financial information regarding the group may only be disclosed by the Chairman of the Board, CEO, CFO, Head of Group Communications and Head of Investor Relations. The divisions may disseminate financial information regarding their operations only after equivalent information has been published by the group.

Monitoring

The Board of Directors' monitoring of internal control with respect to financial reporting takes place primarily through the Audit Committee. The company's process for internal control include self-assessments and systematic follow-ups on risk analysis and control activities. In addition, the company's internal audit carry out yearly assessments of internal control. The monitoring of internal control also takes place within the framework of the statutory external audit. The Audit Committee monitors the financial reporting and takes part of reports from the internal and external auditors.

auditor participates in the Audit Committee meetings.

Board or as required for other reasons.

observations, measures taken and implementation status.

Internal audit

SSAB's internal audit function reports directly to the Audit Committee and is functionally subordinate the Chief Financial Officer. Internal audit's activities consist of supporting value creation in the group by identifying risk areas, carrying out internal audits and thereafter recommending improvements within these areas. The internal

The internal audit is organized at an overall group level, with an audit plan drawn up for the entire group. The group's audit activities are planned by the head of internal audit and are decided by the Audit Committee.

The major part of the work is carried out through audits in accordance with the audit plan. Other work largely consists of specific audits and of monitoring of self-assessments in the group regarding internal control.

The audits are performed in accordance with an established and adopted audit process which is constantly developed in order to optimize the way of working and delivery of reports with generated added value. These reports describe observations, recommendations and improvement areas, with the aim of strengthening and enhancing efficiency in risk management and internal control. The function also carry out reviews on behalf of the

During 2020, internal audit conducted regular, independent and objective audits of the group's corporate governance, internal control and risk management in accordance with the adopted audit plan. The reviews were conducted in accordance with an adopted audit process and formally completed with a report and a planned follow-up. The result has been regularly submitted to divisional heads and the Audit Committee as regards

During the year, internal audit also conducted a number of audits on subsidiaries where the company's manual for audits of risks concerning fraud and corruption was a part of the audit scope. The audits did not reveal any concrete irregularities; however, possibilities to reduce risks were identified. The identified improvement possibilities are implemented in accordance with established action plans. Due to Covid-19, and the

accompanying traveling restrictions, a significant part of the audit of the subsidiaries was undertaken remotely.

CORPORATE GOVERNANCE REPORT 2020 BOARD OF DIRECTORS

STATEMENTS 5-YEAR SUMMARY PRINCIPLES NOTES AUDITOR'S REPORT SHAREHOLDER INFORMATION

131

Other mandatory disclosures pursuant to chapter 6, section 6 of the Annual Accounts Act

The following information is provided pursuant to the provisions of Chapter 6, Section 6 of the Annual Accounts Act regarding certain specific information that must be disclosed in the corporate governance report:

Of the company's shareholders, Industrivärden and LKAB, has direct or indirect shareholdings representing at least one tenth (1/10) of the voting rights carried by all shares in the company. As at December 31, 2020, Industrivärden's holding accounted for 11.8% of the total voting rights and 4.3% of the total number of shares. As at December 31, 2020, LKAB's holding accounted for 10.5% of the total voting rights and 10.5% of the total number of shares.
There are no restrictions on the number of votes that each shareholder may cast at a general meeting.
The Articles of Association contain no provisions regarding the removal of directors or the amendment of the Articles of Association.
The general meeting has not granted the Board of Directors authority to decide that the company may purchase its own shares.

Further information

Further information about corporate governance at SSAB is available at www.ssab.com and includes the following information:

Routines regarding the Annual General Meeting:
when and where the Annual General Meeting is to be held
notice of the Annual General Meeting and how to register
the resolutions to be proposed to the Annual General Meeting
Information from SSAB's previous Annual General Meetings, including for instance notices, minutes, addresses by the CEO and press releases
Articles of Association
Corporate governance reports from previous years
Information about the Nomination Committee

Auditor's report on the corporate governance statement

To the general meeting of the shareholders of SSAB AB (publ), corporate identity number 556016—3429

Engagement and responsibility

It is the Board of Directors who is responsible for the corporate governance statement for the year 2020 on pages 116-131 and that it has been prepared in accordance with the Annual Accounts Act.

The scope of the audit

Our examination has been conducted in accordance with FAR's auditing standard RevU 16 The auditor's examination of the corporate governance statement. This means that our examination of the corporate governance statement is different and substantially less in scope than an audit conducted in accordance with International Standards on Auditing and generally accepted auditing standards in Sweden. We believe that the examination has provided us with sufficient basis for our opinions.

Opinions

A corporate governance statement has been prepared. Disclosures in accordance with chapter 6 section 6 the second paragraph points 2-6 the Annual Accounts Act and chapter 7 section 31 the second paragraph the same law are consistent with the annual accounts and the consolidated accounts and are in accordance with the Annual Accounts Act.

Stockholm March 1, 2021 Ernst & Young AB

Rickard Andersson Authorized Public Accountant FINANCIAL REPORTS 2020

SSAB ANNUAL REPORT 2020

Board of Directors Report	133	5-year summary, Group	168
		Accounting and valuation principles	169
Statements	160	Notes	181
		Proposed allocation of profit	236
Consolidated statement of profit and loss	160	Auditor's report	237
Consolidated statement of		Shares and shareholders	243
comprehensive income	160	Annual General Meeting,
Consolidated statement of financial position	161	Nomination Committee, Calendar	246
Consolidated statement of changes in equity	162	Addresses	248
Consolidated statement of cash flows	163
Parent Company's statement of profit and loss	164
Parent Company's statement of comprehensive
income	164
Parent Company's statement of financial position	165
Parent Company's statement of changes in equity	166
Parent Company's statement of cash flows	167

BOARD OF DIRECTORS' REPORT

133

Board of Directors Report

SSAB AB (publ) Registration number 556016-3429

Revenue was SEK 65,396 (76,485) million
Operating profit before depreciation/amortization and items affecting comparability was SEK 3,364 (6,375) million
Operating profit/loss, excluding items affecting comparability, was SEK -325 (2,159) million
Operating profit/loss, including items affecting comparability, was SEK -325 (1,961) million
Earnings per share was SEK -0.50 (1.04)
Operating cash flow was SEK 3,460 (5,194) million
Net debt/equity ratio was 19% (19%)

Key figures

SEK millions	2020	2019
Revenue	65,396	76,485
Operating profit before depreciation and amortization EBITDA1)	3,364	6,375
Operating profit1)	-325	2,159
Operating profit, IFRS	-325	1,961
Profit after financial items1)	-802	1,770
Profit after tax1)	-490	1,279
Earnings per share (SEK)	-0.50	1.04
Operating cash flow	3,460	5,194
Net debt, including IFRS 16	10,278	11,696
Net debt/equity ratio (%)	19	19

1) Excluding items affecting comparability. For 2019, these amounted to SEK -197 million. For description and amounts, see p. 139

The market

According to the World Steel Association, global crude steel production for 2020 amounted to 1,829 (1,846) million tonnes, down 0.9% compared to 2019. Chinese steel production increased by more than 5%. Steel production decreased in North America by 16% and in the EU-28 by 12%.

In North America, demand for heavy plate was relatively weak already in the first quarter, a situation made worse by Covid-19 during the second and third quarters. During the fourth quarter, demand improved in most customer segments, including distributors, whose inventory levels were at low during the second half of the year.

In Europe, market demand was good during the beginning of the year, but weakened sharply during the second and third quarters as a result of the pandemic. Most customer segments, such as Automotive and Heavy Transport, closed down all or parts of production. Also, steel producers around Europe cut capacity. Customer activity levels picked up again during the fourth quarter and this impacted demand positively. Imports into Europe were at a relatively low level throughout 2020.

Global demand for high-strength steel was also negatively affected by the pandemic. For some segments, primarily Materials Handling, there was good demand for most of the year. There were also geographical differences in demand, with China being negatively affected in the first quarter already but showing good demand for the rest of the year.

In North America, market prices for heavy plate decreased somewhat during the first half of the year, but then rose sharply, especially during the fourth quarter. In Europe, market prices for strip and heavy plate rose at the start of the year but fell during the second quarter with the sharp decline in demand. During the fourth quarter, prices increased substantially and closed the year at a significantly higher level at the end of the year than at the beginning. Market prices for strip and heavy plate in China showed the same trend as in Europe during 2020.

Revenue and operating profit

Revenue for the full year 2020 were SEK 65,396 (76,485) million, down SEK 11,088 million or 15% compared with 2019.

The operating result, excluding items affecting comparability, for the full year was SEK -325 (2,159) million, down SEK 2,484 million compared with the full year of 2019. This decrease was primarily attributable to SSAB Americas, although earnings decreased in SSAB Europe as well. Operating result, including items affecting comparability, amounted to SEK -325 (1,961) million.

Analysis of total change in revenue and operating profit*

Revenue	Operating profit1)
	Change vs. 2019, %		Change vs. 2019, SEK millions
Volume		-2 Price and product mix	-6,850
Price		-8 Volume	-510
Product mix		0 Variable costs	-3,680
Currency effects		-2 Fixed costs	1,630
Other sales		-2 Currency effects	-600
		Capacity utilization	-10
		Other	176
Total	-14		-2,484

1) Excluding items affecting comparability

* Estimated changed, the numbers in the table are rounded

Items affecting comparability

During 2020, SSAB did not report any items affecting comparability. In 2019, items affecting comparability amounted to SEK -186 million. In operating profit, these amounted to SEK -197 million, which was primarily related to the restructuring program in Tibnor and write-down to net realizable value of assets and liabilities held for sale regarding the divestment of Ruukki Construction's project operations, Building Systems. Items affecting comparability of SEK 11 million have been included in tax expenses 2019.

BUSINESS REVIEW	SUSTAINABILITY REPORT	CORPORATE GOVERNANCE REPORT	FINANCIAL REPORTS 2020

External revenue on the largest markets

SEK millions	2020	Share, %	2019	Share, %
Geographical areas
Sweden	10,059	15	11,517	15
Finland	6,687	10	8,294	11
Denmark	3,122	5	3,035	4
Germany	3,125	5	3,965	5
Poland	3,090	5	3,449	5
Italy	1,937	3	2,067	3
Other EU-27	7,905	12	8,602	11
Norway	2,396	4	2,709	4
Great Britain	1,324	2	1,733	2
Other Europe	2,022	3	1,975	3
USA	15,704	24	21,305	28
Canada	2,195	3	1,964	3
Rest of the world	5,831	9	5,869	8
Total	65,396	100	76,485	100

Profit after financial net

The financial net for 2020 amounted to SEK -477 (-389) million and result after financial net amounted to SEK -802 (1,572) million.

Result after tax and earnings per share

The result after tax (attributable to shareholders in the parent company) for 2020 was SEK -510 (1,075) million, equating to SEK -0.50 (1.04) per share. Tax was SEK 312 (-479) million. Positive tax was attributable to the negative result.

136 Major maintenance outages

The table below shows all major planned maintenance outages for 2020 and 2019. The costs for 2020 was lower than normal, partly due to that the maintenance could to greater extent be carried out with own resources due to a lower production level during the second and third quarter of 2020. The figures include the impact of the direct maintenance cost and the cost of lower capacity utilization (underabsorption), but exclude lost margins.

Major maintenance outages in 2019 and 2020

	2020	2019	2020	2019	2020	2019	2020	2019	2020	2019
SEK millions	Q1	Q1	Q2	Q2	Q3	Q3	Q4	Q4	Full year	Full year
SSAB Special Steels	-	-	-	-	250	-	-	300	250	300
SSAB Europe	-	-	-	-	250	285	85	135	335	420
SSAB Americas	-	-	50	-	170	-	-	415	220	415
Total	-	-	50	-	670	285	85	850	805	1,135

Raw materials

SSAB sources iron ore from LKAB in Sweden and from Severstal in Russia and prices vary depending on the market index. SSAB sources coking coal from Australia, the USA and Canada, usually on annual supply contracts with monthly pricing. SSAB Americas regularly purchases scrap metal on the spot market as a raw material for their production.

Change in SSAB's average purchase prices, 2020

	Change vs. 2019
% change	USD	SEK
Iron ore	-9%	-12%
Coking coal	-36%	-38%
Scrap metal	0%	-3%

EBITDA

SEK millions

Profit/loss after financial items

SEK millions

Rolling four quarters (including items affecting comparability)

137

Production and shipments

Crude steel production in 2020 was 1% down compared to 2019, whereas rolling production for 2020 was unchanged compared with 2019. During 2020, SSAB's steel shipments were 6,460 (6,560) thousand tonnes, down 2% compared with 2019.

Production and shipments

Thousand tonnes	2020	2019
Crude steel production	7,535	7,623
Rolling production	6,936	6,994
Steel shipments	6,460	6,560

Cash flow, financing and liquidity

Operating cash flow for the full year 2020 amounted to SEK 3,460 (5,194) million. Compared with 2019, cash flow was impacted primarily by a lower operating result. Net cash flow amounted to SEK 2,180 (-289) million. The full year of 2019 was impacted among other things by Tibnor's acquisition of Sanistål's Danish distribution business and the payment of a dividend to shareholders. Net debt at December 31, 2020 was SEK 10,278 (11,696) million.

The term to maturity of the total loan portfolio at December 31 averaged 4.7 (7.1) years, with an average fixed interest period of 0.9 (1.1) years.

Cash and cash equivalents were SEK 7,051 (3,597) million and non-utilized credit facilities were SEK 14,471 (6,727) million, which combined corresponds to 33% (14%) of rolling 12-months' revenue.

Operating cash flow and net debt

SEK millions	2020	2019
Operating profit before depreciation/amortization	3,364	6,177
Change in working capital	1,570	896
Maintenance expenditures	-1,622	-1,875
Other	147	-4
Operating cash flow	3,460	5,194
Financial items	-545	-432
Taxes	-56	-1,315
Cash flow from current operations	2,859	3,447
Strategic expenditures in plant and machinery	-582	-1,035
Acquisitions of shares and operations	-231	-1,221
Divestments of shares and operations	143	118
Cash flow before dividend	2,189	1,309
Dividend paid to shareholders	-	-1,545
Dividend, non-controlling interest	-9	-7
Acquisition shares from non-controlling interest	-	-46
Net cash flow	2,180	-289
Net debt at beginning of period	-11,696	-8,582
Adjustment net cash flow, IFRS 16	-	-1,945
Net cash flow	2,180	-289
Revaluation of liabilities against equity1)	778	-287
Other2)	-1,540	-593
Net debt at the end of period	-10,278	-11,696

1) Revaluation of hedges of currency risks in foreign operations.

2) Mainly consisting of cash flow effects on derivative instruments and revaluation of other financial instruments in foreign currency as well as during 2019, acquired net debt.

STATEMENTS 5-YEAR SUMMARY PRINCIPLES NOTES AUDITOR'S REPORT SHAREHOLDER INFORMATION BOARD OF DIRECTORS' REPORT

138

Return on capital employed/equity

RReturn on capital employed before tax for the full year 2020 was 2% and return on equity after tax was -1%, whereas the corresponding figures for the full year 2019 were 3% and 2% respectively.

Equity

With earnings of SEK -510 (1,075) million and other comprehensive income (mostly consisting of translation differences) of SEK -5,817 (1,365) million, shareholders' equity in the company amounted to SEK 53,987 (60,314) million, equating to SEK 52.42 (58.57) per share.

Assets with undeterminable useful life

Consolidated assets with undeterminable useful life are allocated to the Group's cash-generating units as shown in the table below:

Assets with an undeterminable useful life per cash-generating unit

	2020	2019
SEK millions	31 Dec	31 Dec
SSAB North America (incl. in the SSAB Americas division)	22,325	25,388
SSAB Special Steels	2,813	3,046
SSAB Europe	2,085	2,171
Tibnor	512	533
Ruukki Construction	140	140
Total goodwill	27,872	31,279
Ruukki Construction (Rautaruukki tradename)	397	467
Total assets with an undeterminable useful life1)	28,269	31, 746

1) The change in values compared to the previous year is mainly due to currency effects, but also due to that the PPA of Abraservice Holding SAS was completed during 2020.

Assets with an undeterminable useful life are tested for impairment each year towards the end of the fourth quarter and in the case of an indication of decline in value. The impairment test showed no need for an impairment charge. For more information about goodwill, see Note 6.

Dividend and allocation of profit

A dividend is proposed of SEK 0.00 (0.00) per share. Consideration relating to proposed allocation of profit in Note 34. Proposed allocation of profit on p. 236 is part of the Board of Director's Report.

Business segments

SSAB has been organized into five reportable business segments with a clear profit responsibility. The business segments consist of the three steel divisions: SSAB Special Steels, SSAB Europe and SSAB Americas as well as the fully owned subsidiaries Tibnor and Ruukki Construction. Tibnor and Ruukki Construction are operated as independent subsidiaries.

SSAB Special Steels

SSAB Special Steels has global responsibility for the marketing and sales of all SSAB's quenched and tempered steels (Q&T) and hot-rolled, advanced high-strength steels with yield strengths of 700 MPa and above. SSAB Special Steels is responsible for steel and rolling production in Oxelösund (Sweden), and for sales of the above products produced in Mobile (USA), Raahe (Finland) and Borlänge (Sweden). When SSAB Special Steels sells steels made by another division, the revenue is reported by SSAB Special Steels and the accounts are settled between the divisions at the cost of goods sold.

SSAB Europe

SSAB Europe has responsibility for strip, plate and tubular products in Europe, and global profit responsibility for the Automotive segment. SSAB Europe is responsible for steel and plate production in Raahe and Hämeenlinna (Finland), and in Luleå and Borlänge (Sweden).

SSAB Americas

SSAB Americas has profit responsibility for heavy plate in North America, and for steel and plate production in Montpelier and Mobile, USA.

Tibnor

Tibnor is the Group's distributor of a full range of steel and non-ferrous metals in the Nordic region and Baltics. Tibnor buys and sells materials produced both by SSAB and other suppliers.

Ruukki Construction

Ruukki Construction is responsible for the sales and production of energy-efficient building and construction solutions, with a focus on northern and eastern Europe. Ruukki Construction includes Plannja.

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139

Revenue and operating profit by business segment

		Revenue		Operating profit
SEK millions	2020	2019	Change	2020	20191)	Change
SSAB Special Steels	16,143	18,495	-2,352	1,506	1,454	52
SSAB Europe	27,954	31,730	-3,777	-1,113	-677	-436
SSAB Americas	13,266	17,460	-4,194	-293	2,128	-2,421
Tibnor	8,241	9,149	-908	96	30	65
Ruukki Construction	5,516	6,510	-994	314	283	32
Other	-	-	-	-489	-233	-256
Depreciation/Amortization surplus values	-	-	-	-346	-827	480
Group adjustments	-5,722	-6,859	1,137	-	-	-
Total	65,396	76,485	-11,088	-325	2,159	-2,484

Items affecting comparability, per quarter and business segment

SEK millions	1/19	2/19	3/19	4/19	1/20	2/20	3/20	4/20
SSAB Special Steels	-	-	-	-	-	-	-	-
SSAB Europe	-	-	-	-	-	-	-	-
SSAB Americas	-	-	-	-	-	-	-	-
Tibnor	-	-	-	-52	-	-	-	-
Ruukki Construction	-	-	-	-	-	-	-	-
Other	-	-	-150	5	-	-	-	-
Total	-	-	-150	-47	-	-	-	-

During 2019, items affecting comparability relate to restructuring programs in Tibnor and write-down of net assets at net realizable value of assets and liabilities held for sale.

1) For 2019, excluding items affecting comparability

The information in the tables on p. 140–144 excludes the depreciation/amortization on surplus values on tangible and intangible assets relating to the acquisitions of IPSCO and Rautaruukki and excludes items affecting comparability. For more information about business segments, see Note 28.

140

SSAB Special Steels

Full year in brief

Demand was negatively affected by Covid-19 and shipments decreased to 1,127 (1,224) thousand tonnes
EBITDA margin up to 13.2% (11.3%), cost reductions and stable production contributed positively
Operating result increased to SEK 1,506 (1,454) million

Key figures

SEK millions	2020	2019
Revenue	16,143	18,495
Operating profit before depreciation/amortization, EBITDA	2,126	2,081
Operating profit	1,506	1,454
Operating profit according to IFRS	1,506	1,454
Operating cash flow	2,179	668
Number of employees at end of period1)	3,228	2,886

1) Employees in Abraservices are included in the number of employees for 2020, they were not included in 2019.

Revenue and operating result

Revenue for 2020 were down 13% compared with 2019 and amounted to SEK 16,143 (18,495) million. Lower volumes had a negative impact of 8 percentage points, currency effects had a negative effect of 4 percentage points and lower prices had a negative effect of 1 percentage point.

The operating result for 2020 was SEK 1,506 (1,454) million, up SEK 52 million compared with 2019. Lower variable and fixed costs affected positively, but counteracted by lower prices, negative currency effects, lower volumes and lower capacity utilization.

Market trend

The good start to the year was followed by a sharp slowdown during the second quarter as a result of the global pandemic. The larger customer segments such as Heavy Transport and Construction Machinery, which largely comprises OEMs, were hit the hardest. During the autumn, demand recovered, first in Heavy Transport and later also in Construction Machinery. The Material Handling customer segment, which includes mining equipment, was at a good level during 2020.

Production and shipments

Crude steel production for 2020 was down 18% compared with 2019. During 2019, both blast furnaces in Oxelösund were operating during the first nine months. Rolling production for 2020 was down with 2% compared with 2019.

External shipments of steel during 2020 were down 8% compared with 2019.

Production and shipments

Thousand tonnes	2020	2019
Crude steel production	1,000	1,225
Rolling production	484	493
Steel shipments	1,127	1,224

Figures for steel shipments include high-strength steel produced at SSAB Europe's and SSAB Americas' steel mills but sold by SSAB Special Steels.

Cash flow and capital expenditure

Operating cash flow for the full year 2020 was SEK 2 179 (668) million. Cash flow was impacted positively by operating profit and by lower working capital.

Capital expenditure payments during 2020 were SEK 458 (504) million, of which SEK 111 (66) million were strategic investments. In 2019, the shares in Abraservices were acquired for SEK 405 million.

SSAB Europe

Full year in brief

Market was negatively affected by Covid-19 and shipments decreased to 3,314 (3,362) thousand tonnes
Operating result fell to SEK -1,113 (677) million
Cost savings contributed positively

Key figures

SEK millions	2020	2019
Revenue	27,954	31,730
Operating profit before depreciation/amortization, EBITDA	554	945
Operating loss	-1,113	-677
Operating loss according to IFRS	-1,356	-921
Operating cash flow	702	182
Number of employees at end of period	6,701	6,853

1) Excluding depreciation/amortization on surplus values on tangible and intangible assets related to the acquisition of Rautaruukki. Depreciation/amortization on surplus values was SEK 243 (244) million during 2020.

Revenue and operating result

Revenue was down 12% compared with 2019 and amounted to SEK 27,954 (31,730) million. Lower prices had a negative impact of 6 percentage points, other revenue had a negative impact of 4 percentage points, currency effects a negative effect of 1 percentage point and lower volumes had a negative impact of 1 percentage point.

The operating result for 2020 fell to SEK -1,113 (-677) million, down SEK 436 million compared with 2019. Lower prices, lower volumes and currency effects had a negative impact, but counteracted by lower variable and fixed costs as well as higher capacity utilization.

Market trend

The market was affected by Covid-19, among other things by a quick downturn during the second quarter. All larger customer segments were affected, although Construction showed good development with steady demand during the year. During the fourth quarter, the market recovered in several customer segments like Automotive and Heavy Transport, driven both by underlying demand and by inventory restocking.

Production and shipments

Crude steel production during 2020 was up 2% compared with 2019 but rolling production was down 3% compared with the full year of 2019.

External shipments of steel during 2020 were down 1% compared with 2019.

Production and shipments

Thousand tonnes	2020	2019
Crude steel production	4,046	3,969
Rolling production	4,111	4,217
Shipments	3,314	3,362

Production figures include high-strength steel made for SSAB Special Steels. These volumes are not included in SSAB Europe's shipments.

Cash flow and capital expenditure

Operating cash flow for the full year of 2020 amounted to SEK 702 (182) million. Cash flow was impacted positively by lower working capital.

Capital expenditure payments during the full year of 2020 were SEK 1,280 (1,584) million, of which SEK 230 (518) million were strategic investments.

142

SSAB Americas

Full year in brief

Shipments amounted to 2,019 (1,974) thousand tonnes
Operating result amounted to SEK -293 (2,128) million, lower margins affected negatively
Cost savings contributed positively

Key figures

SEK millions	2020	2019
Revenue	13,266	17,460
Operating profit before depreciation/amortization, EBITDA	415	2,852
Operating profit1)	-293	2,128
Operating profit according to IFRS	-372	1,564
Operating cash flow	415	3,540
Number of employees at end of period	1,211	1,254

1) Excluding depreciation/amortization on surplus values on tangible and intangible assets related to the acquisition of IPSCO. Depreciation/amortization on surplus values was SEK 79 (564) million during 2020.

Revenue and operating result

Revenue was down 24% compared with 2019 and amounted to SEK 13,266 (17,460) million. Lower prices had a negative effect of 24 percentage points and currency effects a negative effect of 2 percentage points. Higher volumes had a positive effect of 2 percentage points.

The operating result for 2020 was SEK -293 (2,128) million, down SEK 2,421 million compared with 2019. Lower earnings were mainly attributable to lower prices, but was counteracted by lower variable and fixed costs.

Market trend

The North American heavy plate market was affected by the pandemic during 2020 with a squeeze on prices, especially during the second and third quarters. Demand was weak in Oil & Gas (part of the Energy segment) and Construction and also generally within the manufacturing industry. Demand in other parts (wind power and power transmission) of the Energy segment, which refers to renewable energy production, which was at a good level throughout the year. A slight recovery was seen during the fourth quarter and shipments improved, for example in Construction Machinery and Steel Service Centers (distributers), which started to restock.

Production and shipments

Crude steel production during 2020 was up 2% compared with 2019 and rolling production was up 3% compared with 2019.

External shipments of steel were up 2% compared with 2019.

Production and shipments

Thousand tonnes	2020	2019
Crude steel production	2,489	2,429
Rolling production	2,343	2,285
Shipments	2,019	1,974

Production figures include high-strength steel made for SSAB Special Steels. These volumes are not included in SSAB America's shipments.

Cash flow and capital expenditure

Operating cash flow during 2020 amounted to SEK 415 (3,540) million. The cash flow was impacted positively by lower working capital, but was counteracted by lower operating result.

Capital expenditure payments during the full year of 2020 amounted to SEK 304 (646) million, of which SEK 189 (363) million was strategic investments.

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Tibnor

Full year in brief

Market negatively affected by Covid-19
The restructuring program contributed to improved result
The operating result rose to SEK 96 (30) million

Key figures

SEK millions	2020	2019
Revenue	8,241	9,149
Operating profit before depreciation/amortization, EBITDA	240	206
Operating profit1)	96	30
Operating profit/loss according to IFRS	70	-47
Operating cash flow	186	348
Shipments, thousand tonnes	781	786
Number of employees at end of period	981	1,133

Revenue and operating result

Revenue was down 10% compared to 2019 and amounted to SEK 8,241 (9,149) million. The decline was attributable to lower volumes and lower prices.

The operating result for 2020 was SEK 96 (30) million, up SEK 66 million compared with 2019. Higher earnings were primarily attributable to lower variable and fixed costs.

Market trend

The market improved during the start of 2020 compared to the fourth quarter of 2019. This was followed by a sharp weakening in demand during the second and third quarter, because of the pandemic. During the fourth quarter, demand recovered, especially in Sweden and Finland, and grew gradually stronger. The automotive and engineering industries drove the upswing. As far as the full-year 2020 was concerned, the markets in Finland and the Baltics were less affected by the pandemic compared with the rest of the Nordics.

Cash flow and capital expenditure

Operating cash flow for the full year of 2020 amounted to SEK 186 (348) million. Cash flow was impacted positively by a lower working capital and by the operating profit.

Capital expenditure payments during the full year 2020 amounted to SEK 53 (108) million, of which SEK 7 (47) million were strategic investments. In 2019, Tibnor acquired Sanistål for SEK 523 million.

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Ruukki Construction

Full year in brief

Stable demand
Operating result up to SEK 314 (283) million
Divestment of Building Systems completed in 2020

Key figures

SEK millions	2020	2019
Revenue	5,516	6,510
Operating profit before depreciation/amortization, EBITDA	484	466
Operating profit1)	314	283
Operating profit according to IFRS	318	293
Operating cash flow	481	348
Number of employees at end of period	1,362	1,841

Revenue and operating result

Revenue of comparable units was relatively unchanged compared to 2019. The reported revenue was down 15% compared with 2019 and amounted to SEK 5,516 (6,510) million, due to the divestment of Building Systems, which is included in the figures until the end of April 2020.

Operating result for 2020 amounted to SEK 314 (283) million. The improvement compared to 2019 was partly due to improved margins for the product business (Roofing and Building Envelopes).

During the second quarter of 2020, the divestment of Building Systems was completed. Ruukki Construction's divested project business, Building Systems, had revenue of around SEK 1.5 billion in 2019 and a minor positive operating profit. During the first four months of 2020, Building Systems had revenue of SEK 0.6 billion and a minor positive operating profit. For more information, see note 26.

Market trend

During the full year of 2020, demand was at a good level and in most geographical markets. Covid-19 had a certain negative impact, especially in the markets in central and east of Europe and the Baltics.

Cash flow and capital expenditure

Operating cash flow for 2020 amounted to SEK 481 (348) million. Cash flow during the quarter was impacted positively by operating profit but affected negatively by higher working capital.

Capital expenditure payments during the full year amounted to SEK 88 (113) million, of which SEK 45 (41) million were strategic investments. During 2019, 67% of the shares in Piristeel was acquired for SEK 180 million.

Permitted production at the Swedish plants1)

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Capital expenditures, research and development

Capital expenditures

Capital expenditures payments during 2020 amounted to SEK 2,292 (4,013) million, of which SEK 670 (2,256) million were strategic investments, including acquisitions and divestments of businesses and operations.

Research and development

Research and development activities are focusing on areas that aim at increasing the profitability of SSAB. Close collaboration with strategic customers and customer segments providing conditions for a market-driven product development that creates increased value also for the end-customers. This is particularly evident for SSAB's high-strength steels, where also technical customer support is an important part of research and development. Continuous work is also carried out with the development of the processes for increased cost efficiency, sustainable processes and energy conservation. During the year, research and development investments amounted to SEK 312 (336) million.

Environment

Steel production is an energy intensive process that affects the environment, including carbon dioxide emissions. In Sweden and Finland, SSAB's blast furnaces are among the largest sources of carbon dioxide emissions in each country. At the same time, SSAB's blast furnaces are among the most efficient in the world in terms of minimizing emissions from steel production. The impact on the local environment in the vicinity of SSAB's plants has decreased significantly in recent decades. Technical development and increasingly stringent external demands dictate constant improvements in the operations.

The most important environmental aspects for SSAB are:

Air emissions reductions of carbon dioxide, nitrogen oxides, sulfur oxides and particulate matter
Water effluent reductions of nitrogen and suspended substances
Efficient use of raw materials and energy
Landfill waste minimization

SSAB's operations are subject to environmental permits with hundreds of environmental conditions governing among other things production levels, emissions into the air and water, noise levels, and rules regarding landfill sites.

Thousand tonnes	Location	Permitted production	Production 2020	Production 2019
Coke	Luleå	800	668	710
	Oxelösund	530	349	357
Hot metal	Luleå2)	-	1,963	1,996
	Oxelösund	2,000	883	1,176
Steel slabs	Luleå	2,500	1,890	1,893
	Oxelösund	1,900	941	1,138
Hot-rolled steel	Borlänge	3,200	1,932	2,032
	Oxelösund3)	1,000	486	518
Pickled steel	Borlänge	2,500	1,133	1,169
Cold-rolled steel	Borlänge	1,400	577	590
Annealed steel	Borlänge	900	504	526
Organic-coated products	Köping	30	19	14
	Finspång4)	40	31	31
Steel tubes	Virsbo	125	16	16

1) In North America, the permitted production levels are determined through maximum permitted hourly production volumes and not applicable for Finnish sites.

2) Not regulated

3) Delivery of plate

4) Unit million m2

Sustainability report

In accordance with the Swedish Annual Accounts Act, Chapter 6, Section 11, SSAB AB has chosen to establish the statutory sustainability report as a separate report. Sustainability report covers SSAB AB Group and it is on p. 44–115 in this annual report.

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Personnel

At year-end 2020, the number of employees (excluding temporary employees) amounted to 13,974 (14,514). The total compensation to employees, including social security expenses and pension cost, amounted to SEK 9,755 (10,896) million. Additional information about compensation to employees, see Note 2.

Number of employees per business segment at year-end

	2020	2019
SSAB Special Steels1)	3,228	2,886
SSAB Europe	6,701	6,853
SSAB Americas	1,206	1,254
Tibnor	981	1,133
Ruukki Construction	1,362	1,841
Other	496	547
Total	13,974	14,514

1) Employees in Abraservices are included in the number of employees for 2020, they were not included in 2019.

Remuneration guidelines for senior executives

These remuneration guidelines include the CEO and other senior executives. The guidelines are applicable to remuneration agreed, and amendments to remuneration already agreed, after adoption of the guidelines by the annual general meeting 2020. These guidelines do not apply to any remuneration decided or approved by the general meeting.

The guidelines' promotion of the company's business strategy, long-term interests and sustainability

SSAB's business strategy aims to establish the company as an industry leader in terms of both profitability and sustainability among comparable companies. SSAB's stated objective is to become the safest steel company in the world to work in, and shall in addition adhere to high environmental standards and be a responsible partner to all stakeholders. A more detailed description of the business strategy can be found on the company's website. A successful implementation of the company's business strategy and the safeguarding of the company's long-term interests require that the company can recruit and retain qualified employees. For this, the company must be able to offer competitive remuneration in the labor market on which the executive operates. These guidelines

are intended to offer senior executives a competitive total remuneration, which in turn promotes the company's business strategy, long-term interests and sustainability.

Types of remuneration, etc.

The remuneration shall be on market terms and may consist of the following components: fixed cash salary, variable cash remuneration consisting of a short-term variable component ("STI") and a long-term variable component ("LTI"), pension benefits and other benefits. Additionally, the general meeting may – irrespective of these guidelines – resolve on, among other things, share-related or share price-related remuneration.

The satisfaction of criteria for variable cash remuneration shall be measured over a period of one year for STI and three years for LTI. STI may amount to not more than 75 percent of the fixed annual cash salary for the CEO and not more than 50 per cent for other senior executives. LTI may amount to not more than 30 per cent of the fixed annual cash salary for the CEO and other senior executives.

For the CEO and other senior executives pension benefits shall be contribution-based except in those cases where so provided in the rules of a general pension plan (e.g. the Swedish ITP2 plan). The retirement age should be set individually, however, in no case earlier than the age of 62. In the event the employment terminates prior to the retirement age, the executive shall receive a paid-up policy for earned pension. Variable cash remuneration shall not qualify for pension benefits, except in those cases where so provided in the rules of a general pension plan. The pension premiums shall amount to not more than 50 per cent of the annual pensionable salary.

Other benefits may include, for example, health insurance, medical insurance and company cars. Premiums and other costs relating to such benefits may amount to not more than 10 per cent of the fixed annual cash salary.

Remuneration under employment subject to other rules than Swedish may be duly adjusted to comply with mandatory rules or established local practice, taking into account, to the extent possible, the overall purpose of these guidelines.

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Termination of employment

Upon termination of an employment, the notice period may not exceed twelve months. Fixed salary during the period of notice and severance pay may together not exceed an amount equivalent to the fixed salary for 24 months for the CEO and 18 months for the other senior executives. The period of notice may not exceed six months without any right to severance pay when termination is made by the executive.

For senior executives outside Sweden, the termination period and severance pay may deviate from the above stated due to legislation or local market practice.

Criteria for variable cash remuneration, etc.

The variable cash remuneration shall be linked to predetermined and measurable criteria. The criteria shall be designed to contribute to the company's business strategy and long-term interests, including sustainability.

The criteria for STI are set annually and shall consist of group objectives, of unit objectives (i.e. objectives related to a particular division, a certain subsidiary or a certain function) and of individual objectives, with distribution as follows.

Group objectives may be financial and non-financial. The financial objectives shall comprise at least 60 per cent of the group objectives and shall be linked to EBITDA margins in relation to a comparison group of the company's competitors, own EBITDA level or margin, return on capital employed, the company's cash flow or the company's stock turnover. The non-financial group objectives shall be linked to sustainability.

The unit objectives may be different for different units. For units with clear profit responsibility, the unit objectives shall comprise to at least 50 per cent of financial objectives that shall be linked to sales, volumes, operating profit, operating margins, cost savings, return on capital employed or cash flows. The remaining part of the unit objectives shall consist of operational objectives linked to sustainability and fulfillment of the unit's strategic plan. For other units, the unit objectives shall be designed so that they clearly contribute to the fulfillment of the respective unit's strategy, including sustainability.

Individual objectives shall consist of quantitative or qualitative objectives aimed at increased value creation for the company.

For the CEO, STI shall comprise at least 85 per cent of group objectives and the remainder of individual objectives. For senior executives with clear own profit responsibility, STI shall comprise at least 45 per cent of unit objectives, up to a maximum of 15 per cent of individual objectives and the remaining part of group objectives. For other senior executives, STI shall consist of at least 70 per cent of group objectives, up to a maximum of 15 per cent of individual objectives and the remaining part of unit objectives.

LTI shall to 40–60 per cent be linked to the total return on the SSAB share in relation to a comparison group of the company's competitors and the remaining part shall be linked to a group-wide financial objective such as return on capital employed, own EBITDA level or EBITDA margin. However, for employees in division Americas, 20–40 per cent of LTI shall be linked to SSAB Americas own earnings and return on capital employed.

The objectives of LTI are to create a common interest for the company management and shareholders to drive the business towards long-term good return on the SSAB-shares and to promote the company's ability to recruit and retain key employees.

The variable cash compensation programs shall be structured such that the board of directors has the possibility, should exceptional circumstances prevail, to restrict the payment of variable cash compensations, or to decline to make such payment, where such a measure is deemed reasonable and compatible with the company's responsibilities to its shareholders, employees and other stakeholders.

To which extent the objectives for variable cash remuneration has been satisfied shall be evaluated when the measurement period has ended. Following a proposal from the remuneration committee, the board of directors is responsible for the evaluation so far as it concerns variable remuneration to the CEO. For variable cash remuneration to other senior executives, the remuneration committee is responsible for the evaluation in consultation with the CEO. When the board of directors assesses how the financial objectives have been met, this should be done against the latest published financial information with any adjustments that the board of directors considers necessary or appropriate.

Before the payment of variable cash compensation is effected, the board of directors must verify that the objectives linked to the remuneration have been met and that the remuneration has been calculated correctly.

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Salary and employment conditions for employees

In the preparation of the board of directors' proposal for these remuneration guidelines, salary and employment conditions for employees of the company have been taken into account by including information on the employees' total income, the components of the remuneration and increase and growth rate over time, in the board of directors' and the remuneration committee's basis of decision when evaluating whether the guidelines and the limitations set out herein are reasonable.

The decision-making process to determine, review and implement the guidelines

The board of directors has established a remuneration committee. The committee's tasks include preparing the board of directors' decision to propose guidelines for executive remuneration. The remuneration committee shall also monitor and evaluate programs for variable remuneration for the executive management, the application of these remuneration guidelines as well as the current remuneration structures and compensation levels in the company. The CEO and other senior executives do not participate in the board of directors' or the remuneration committee's processing of and resolutions regarding remuneration-related matters in so far as they are affected by such matters. The board of directors shall prepare a proposal for new guidelines at least every fourth year and submit it to the general meeting. The guidelines shall be in force until new guidelines are adopted by the general meeting.

Derogation from the guidelines

The board of directors may temporarily resolve to derogate from the guidelines, in whole or in part, if in a specific case there is special cause for the derogation and a derogation is motivated to serve the company's longterm interests, including its sustainability, or to ensure the company's financial viability. As set out above, the remuneration committee's tasks include preparing the board of directors' resolutions in remuneration-related matters, including also preparation of resolutions to derogate from the guidelines.

Risk management

SSAB's earnings and financial position are affected by many factors, several of which are beyond the company's control. These include: general political, sustainability and economic conditions. Many of these factors can impact SSAB positively or negatively. Risk management supports the achievement of strategic objectives and targets. It ensures the continuity of operations also in changing circumstances.

Risk governance and management process

Responsibility for the long-term, overall management of strategic risks is dictated by the company's delegation policy, namely from the Board of Directors to the CEO and from the CEO to the heads of each division and subsidiary. SSAB's decentralized organization means that divisions and subsidiaries are primarily responsible for managing the operational risks in the Group. Risk mapping of the Group's internal and external risks is carried out as an integrated part of the annual strategy process. The divisional and subsidiary managers conduct an annual risk assessment as part of their strategy process, and the results of this work are combined into a group-level risk map and reported to the Audit Committee and to the Board of Directors.

SSAB's insurance function is tasked with procuring group-wide protection for the insurable risks. The management of financial risks is centralized on the Group's treasury function. SSAB has an internal control function that supports operations in identifying risk areas and, based on a risk analysis, establishes control processes to mitigate identified risk areas. Also, SSAB has an internal audit unit which, among other tasks, based on a risk analysis conducts audits of internal controls and processes followed by recommendations for improvements within these areas. The internal audit unit reports directly to the Audit Committee. For full information about the Group's internal audit function, see the Corporate Governance Report.

Sustainability risks are integrated into the strategy and risk management processes. All SSAB production sites are certified according to ISO 14001, in which risks are addressed. Certification also means that all our sites have been audited by a third party.

Risk assessment

The enterprise risk assessment is embedded in SSAB's yearly strategy process with the purpose of achieving SSAB's strategies and targets and ensuring business continuity, even in the event of turbulence in the global steel market. In the risk assessment, two types of risks are assessed.

1. Internal risks: originate from activities and situations that SSAB has influence over. Risk areas cover: Sales/ Customer, Operational, People, Sustainability and own Financial risks.
2. External risks: based on external developments over which SSAB has no or limited control. Risk areas cover: Market, Industry, Regulatory, Financial risks and Other risks, including climate change related risks.

The risk level of a certain risk is calculated based on the estimated impact (financial/reputational) and likelihood (probability of occurrence) based on a specific classification system.

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150

Internal risks

The top internal risks are briefly commented and presented in order of magnitude including associated planned and ongoing mitigation activities.

living near affected sites.

Risk factor	Risk description	Mitigation
Major production disruption at one of the seven steel mills	The steel production process is dependent on the continuous operation of critical production equipment, and production downtime may occur as a result of unanticipated mechanical failures or other events. Disruptions to this production process	Mitigating actions for mechanical failures include preventive equipment and system risk assessments, and keeping spare parts to reduce the downtime. Mitigations to process risks include maintaining stocks of crucial raw materials, products in progress and finished products as well as analyzing our vendors and incoming flows.
	chain could have a material adverse effect on SSAB's operations and customer service levels.	In order to minimize costs, if this kind of risk still occurs, there are business continuity plans as well as property damage insurance and business disruption insurance in place. Continuity plans also include measures to protect personnel within critical functions, for example during a pandemic.
Serious safety hazards and personnel accident(s)	SSAB is subject to the risk of industrial accidents that could lead to production stoppages, the loss of key assets and employees (and those of subcontractors and suppliers) or injuries to persons	Fundamental safety measures are continuously taken and constitute the practices and actions mentioned in SSAB One ( e.g. risk assessments, continuous preventive training of employees and contractors, and many others). Additionally at the Group level a "Group Safety Plan" is being implemented to harmonize safety management. Read more about safety management on

p. 67–70.

level a "Group Safety Plan" is being implemented to harmonize safety management. Read more about safety management on

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Risk factor	Risk description	Mitigation
Information system (IT) security breaches and breakdowns	SSAB is dependent on an efficient IT infrastructure in its operations around the world. SSAB's reputation and business could be materially harmed as a result of data breaches, data theft, unauthorized access or successful hacking.	SSAB has progressed well with its cyber-security programs to reduce the probability and impact of this risk, including e.g. risk assessments to legacy systems, training and awareness activities, and building and installed a Security Operation Center (SOC) as well as tools to detect any malicious attempts or anomalies.
Failure to attract, retain and develop needed competencies and talents	SSAB's ability to continue to maintain and grow its business as well as provide high-quality products depend on the contributions of its management team and motivated qualified employees throughout the organization.	SSAB is running several programs to improve SSAB's attractiveness as an employer, e.g. through collaborations with universities, nurturing talents with long-term career planning, and active succession planning. Further utilizing the positive attention from the HYBRIT initiative will boost the SSAB brand perception as a technology and sustainability leader.
		SSAB also conducts a regular engagement survey covering all employees in the company. Th is enables quick initiation of new activities.

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Risk factor	Risk description	Mitigation
Reputational risk, if a product deviates from customer expectations due to material problem or human design error	Given the nature of steel production, with many integrated processes and finely-tuned steps, deviations from the normal production process can lead to product failure.	The risk is tightly connected to production issues and processes that are in place, and the risk probability increases when a deviation occurs. To manage this, ongoing work around improved quality management, enforcing clear guidelines and appropriate checks in the production process, and ensuring right competences at the right place in the quality assurance process, are in place.
Failure or disruption at key suppliers of input materials	Steel production requires substantial amounts of raw materials, including iron ore, scrap metal, metallurgical coal, injection coal, coke and alloys. Failure to secure availability of raw materials could have an adverse effect on SSAB's operational and financial results.	To mitigate this risk, the purchasing function continues to work to diversify raw material sourcing i.e. avoid single sourcing of material, but also to form closer collaboration with suppliers to better understand disturbances and identify redundancy plans for critical input materials. Read more about sustainable sourcing on p. 81–83.
Insufficient delivery performance to customers	The lead time to customers is heavily dependent on the steel production process is running well. Production disturbances can affect the delivery performance to customers.	SSAB has taken several measures to reduce the probability of this occurring. Work will continue to improve production stability and forecasting, accurate order handling, and increasing mill-to-mill flexibility.

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Risk factor	Risk description	Mitigation
Employees committing fraud and/or engaged in corruption activities	In today's globalized world, anti-corruption and business ethics have become increasingly important for companies. Failure to address corruption, bribery and other issues related to business ethics could have negative impacts on SSAB's reputation and brand.	Anti-corruption and business ethics at SSAB are governed by SSAB's Code of Conduct and SSAB's governing document for anti-corruption (Read more on p. 84–86) Actions to minimize the risk include defined and enforced policies, continuous compliance training, including internal governance and close follow-ups of various controls.
Loss of major customer and market share	In a cyclical business like steel, an economic downturn can deeply impact our existing customer portfolio as the steel industry cycle goes hand in hand with that of our customers.	To reduce the risk, SSAB's sales organizations continue to work on customer mix and segments, and maintain close collaboration with our customers to understand demand swings and new needs.
Environmental risks, such as leakage of hazardous substance or pollution into the air and/or water	Steel production requires input material that can have a negative environmental impact if unforeseen or sudden events occur that result in spills of hazardous material.	Ongoing mitigation activities include: various preventive maintenance efforts to identify the risks early, planned responses to minimize the likelihood of a repeat occurrence, and process safety work and drills.

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Operational risks cont.

External risks

By their very nature, these external risks are harder to mitigate although certain mitigations can limit their impact. The external risks are briefly commented and presented in order of magnitude below.

Risk factor	Risk description	Mitigation
Economic downturn/worsened steel demand in SSAB markets	The steel industry is sensitive to fluctuations in the business cycle, where changing demand combined with relatively fixed capacity leads to rapid movements in prices and margins.	SSAB focuses on specific markets where the company can be the customers' supplier of choice in all business cycles. This includes the company's home markets, namely the Nordics and North America, as well as high-strength steels segments globally, where demand is typically more stable. A continuous focus on developing special and premium niche products will enable SSAB to maintain and strengthen its position in relation to its competitors.
	The Covid-19 pandemic is having a major impact on demands in our markets and puts pressure on profitability.	In recent years, SSAB has strengthened its balance sheet and is now more resilient to a possible downturn, such as the one induced by the Covid-19 pandemic during 2020.
Fluctuating/increasing raw material and energy prices	Raw materials are priced in the world market and prices generally vary in accordance with the availability of such raw materials and the demand for steel.	Price volatility has increased in recent years primarily as a result of fluctuating customer demand globally, supply shortages of raw materials and price speculation. SSAB aims to develop raw material supplies, e.g. various scrap grades, and secure dual source supply where possible.
Steel price volatility	The development of steel prices directly affects SSAB's profitability. Steel prices fluctuate according to macroeconomic factors, and are largely sensitive to the cyclical nature of the business sectors that are the principal consumers of steel.	To lower the impact of decreasing steel prices, SSAB aims to secure a proper mix of contract business and to create an appealing image as a premium steel supplier to improve the ability to move the price volatility downstream.

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Risk factor	Risk description	Mitigation
Risks in the global trade system	SSAB's core markets continue to be exposed to global trade and pricing practices. Potential unfair trading practices, such as dumping and/or government subsidies, may impact SSAB's ability to compete with other producers and affect SSAB's operational and financial performance.	Actions by SSAB include publicly advocating fair and free trade, and amending our sales strategy based on trade policy to secure SSAB's market position in core markets.
EU and/or Swedish national CO2 reduction goals significantly impact costs for blast furnace-based steel making	In both Sweden and Finland, SSAB's blast furnaces are significant emitters of carbon dioxide gases. Changes to the current EU Emissions Trading System (EU-ETS) could result in increased costs from the potential need to purchase more emission allowances.	SSAB's steel mills are among the most efficient in the world in terms of CO2 emissions, and as a consequence will be less impacted than competitors by changes in regulations. Longer term, SSAB is planning to eliminate CO2 emissions altogether through, for example, the HYBRIT initiative, and planned conversion to electric arc furnaces (EAF). Read more on p. 7 and 63–65.
Competitor activities/ innovation severely impacting the competitiveness of SSAB's offering	The markets in which steel companies operate are highly competitive. SSAB may be affected by new production technologies, products, services and customer offerings developed by competitors.	To remain competitive, SSAB invests in new production technologies and R&D to spur product development, which is the responsibility of all divisions. Furthermore, SSAB continues with our home market strategies and automotive focus, but also works on downstream joint ventures and acquisitions.

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Operational risks cont.

Risk factor	Risk description	Mitigation
Global steel overcapacity continues to grow	Excess steel production capacity has been impacting steel industry dynamics since the financial crisis of 2008.	SSAB's mitigating strategies include participating in industry associations to promote the steel message, work with the customer mix and invest in downstream activities.
Increased environmental regulation - energy, water, landfills, etc.	As environmental legislation and regulations are amended, the costs of compliance with new and more stringent regulations may be imposed on SSAB.	To mitigate this challenge, SSAB continues government relations work, legislative tracking and participation in discussions to provide input on potential new regulations.
Climate change related events	Extreme weather, hurricanes, forest fires, and flooding can have a negative impact on SSAB operations, and on the demand for SSAB products.	SSAB has ambitious plans to reduce greenhouse gas emissions throughout the value chain to combat climate change. Read more on page 74. Internally SSAB also has various plans in place to secure safe operations in the event of extreme weather.

Financial risks and sensitivity analysis

SSAB's financial risks are presented in more detail in Note 29 to the financial statements.

Risk factor	Risk description	Mitigation

Refinancing risk/liquidity risk	Refinancing risk/liquidity risk means the risk of SSAB being unable	The borrowing strategy is focused on securing the Group's needs for loan financing with regard to long-term loans and SSAB's
	to pay its obligations due to insufficient liquidity or difficulties in	day-to-day payment obligations to its lenders and suppliers. Borrowing takes place primarily through the Parent Company,
	raising new loans.	taking into consideration the Group's financial targets. In order to minimize the refinancing risk, the objective is that long-term
		loans will have an even maturity and an average term to maturity in excess of three years. The liquidity buffer (i.e. non-utilized,
		binding credit facilities, as well as cash and cash equivalents) shall depending on the net debt/equity ratio, exceed 5%-10% of
		the Group's sales.

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Financial risks cont.

Risk factor	Risk description	Mitigation
Market risk	Market risks comprise the risk of the Group's earnings or financial position being affected by movements in market prices, such as interest rates and exchange rates.	Interest rate risks: The Group's interest rate risks relate to movements in market interest rates and their impact on the debt portfolio. The average fixed-rate term in the total debt portfolio should be approximately 1 year, but is permitted to vary between 0.5 and 2.5 years.
Currency flow 2020 SEK millions -50k -40k -30k -20k -10k 0	USD EUR CAD GBP DKK NOK OTHER 10k 20k 30k 40k 50k	Currency risks: SSAB's currency exposure related to translation exposure, largely relates to the translation risk regarding net assets of foreign subsidiaries. This exposure is partly hedged through borrowing in foreign currency. The objective is to minimize the foreign exchange impact on the net debt/equity ratio. The Swedish krona (SEK) is the base currency. In order to manage the transaction risk, contracted commercial currency flows are hedged. Major investments and projects decided upon in foreign currency are hedged. The net currency inflow in 2020 was SEK 0.5 (3.7) billion. The Group's most important currency flows are shown in the adjacent diagram.
Outflow

Inflow

BUSINESS REVIEW		SUSTAINABILITY REPORT CORPORATE GOVERNANCE REPORT			FINANCIAL REPORTS 2020
BOARD OF DIRECTORS' REPORT	STATEMENTS	5-YEAR SUMMARY	PRINCIPLES	NOTES	AUDITOR'S REPORT	SHAREHOLDER INFORMATION

Financial risks cont.

Risk factor	Risk description	Mitigation
Credit risk	Credit risk means the risk of losses due to the Group's customers or counterparties in financial contracts being unable to perform their payment obligations.	Financial counterparties are selected based on Standard & Poor's and Moody's current ratings for long-term borrowing and taking into account the Group's reciprocal commercial relations with the relevant counterparty. The minimum acceptable ratings for financial instruments are A- from Standard & Poor's or A3 from Moody's. Credit risks associated with accounts receivable and other claims are managed in each division and subsidiary, taking into account the Group's credit directive.

Sensitivity analysis

The approximate full year effect on the profit after financial items and earnings per share of changes in significant factors is shown in the sensitivity analysis below.

	Change, %	Effect on profit/loss before tax, SEK millions	Effect on earnings per share, SEK2)	Effect on equity, SEK million2)
Steel price – steel operations	+/- 10	+/- 5,150	+/- 3.93	+/- 4,048
Volume – steel operation1)	+/- 10	+/- 720	+/- 0.55	+/- 566
Iron ore prices	+/- 10	+/- 730	+/- 0.56	+/- 574
Coal prices	+/- 10	+/-400	+/- 0.31	+/- 314
Scrap metal prices	+/- 10	+/- 690	+/- 0.53	+/- 542
Interest rate	+/- 1%-point	+/- 60	+/- 0.05	+/- 47
Swedish Krona3)	+/- 5	+/- 320	+/- 0.24	+/- 252

1) Excluding the effect of lower capacity utilization (underabsorption).

2) Calculated based on a 21.4% tax rate.

3) Calculated on SSAB's exposure without currency hedging. Any weakening of the Swedish krona entails a positive effect.