Sustainability Report 2022

Grants are also awarded to projects which underpin and develop the neuroscience and healthcare communities in Denmark, including activities related to the dissemination of new scientific discoveries and competence building. Brain health is at the centre of the Foundation’s grant strategy and the amount awarded in support of brain research was approximately 78% of the total awarded grant amount in 2022.

For detailed descriptions of the business models of the three subsidiaries, please refer to page 6 in the 2022 H. Lundbeck A/S sustainability report, page 6 in the 2022 ALK Abelló A/S sustainability report and page 12 in the Management’s review of Falck A/S’ Annual Report 2022.

UN GLOBAL COMPACT AND THE SDGs

The Lundbeck Foundation is a strong believer in the need for international solutions to international problems. It was the first enterprise foundation in Denmark to sign the UN Global Compact in 2012, and the 10 UN principles serve as general guidelines for the Foundation’s policies, strategies, processes and for the Foundation’s conduct in general.

The Lundbeck Foundation’s three subsidiaries are all signatories to the UN Global Compact: Lundbeck signed in 2009, while ALK and Falck signed in 2019.

Closely linked to UN Global Compact are the 17 Sustainable Development Goals (SDGs) which guide the Lundbeck Foundation’s commitment to a more sustainable world.

THE LUNDBECK FOUNDATION’S COMMITMENT

As one of Denmark’s largest enterprise foundations, the Lundbeck Foundation shares an important responsibility for the sustainable development of the country’s science and business communities. In 2023, the Foundation will formalise this effort further with a sustainability policy.

The Lundbeck Foundation seeks to create sustainable impacts within the four SDG areas shown in the figure below. These are:

Supporting

Pioneering innovation within healthcare

Improving health and quality of life starting with the brain

responsible economic growth and job creation

Promoting sustainable practices and good governance

IMPROVING HEALTH AND QUALITY OF LIFE STARTING WITH THE BRAIN

At the core of the Lundbeck Foundation’s purpose and strategy of bringing discoveries to lives is the commitment to drive new health discoveries that can improve people’s lives and well-being.

NEW SCIENCE FOR BETTER LIVES

Throughout history, scientific discoveries have changed global health and improved peoples’ lives. The Lundbeck Foundation supports the generation of new knowledge through its philanthropic grants within biomedical and health science research.

In 2022, the Foundation awarded a total of DKK 550m in grants ranging from large-scale research projects to talent development. An important part of the Foundation’s strategy is to ensure that the supported research has the potential to ultimately benefit the lives of patients.

THE COMMITMENT TO BRAIN HEALTH

The number of people with brain diseases is growing around the globe and is estimated to impact close to 3 billion people worldwide. Despite the devastating socio-economic and personal consequences of neurological diseases such as Alzheimer’s and Parkinson’s, and mental health disorders, the advancement of new treatments hinges on better fundamental knowledge about the brain.

Funding top-tier neuroscience in order to generate knowledge that can lead to better prevention, diagnosis and treatment of brain disorders is a central part of the Foundation’s 2030 strategy. In 2022, approx. 78% of its total grants were awarded to neuroscience – corresponding to DKK 430m. This included DKK 174m to seven new LF Collaborative Projects, where

diverse research groups, spanning multiple disciplines, universities and countries, work together to shed light on some of the most complex neuroscience topics.

2022 was also the year, when the Foundation launched Neurotorium for clinicians, educators and everyone who is interested in exploring the brain. Neurotorium is an open, online platform intended to enhance knowledge of the brain and its diseases. It offers freely available educational material developed in collaboration with leading global experts within neurology and mental illnesses. TheNeurotorium brainatlasletsusers examinestructures inthebraininan accurateandfully interactive3D model.

SDG 3 constitutes an important strategic anchor for the Foundation’s philanthropic and commercial activities - especially sub-target 3.4 regarding the treatment of non-communicable diseases and mental health, given the Foundation’s focus on the brain.

healthcare, all the Foundation’s ownerships are driven by the clear objective of improving the lives of the millions of patients that are reached every year.

In late 2022, the Foundation added Ferrosan Medical Devices (FeMD) as a fourth healthcare ownership to the portfolio. FeMD develops and manufactures products for the treatment of acute bleeding during surgery, as well as breast cancer biopsy units. Its surgery products alone are used in more than a million surgeries each year. The Lundbeck Foundation is proud to be part of FeMD’s future journey to deliver health impact.

+8 million

People reached on a daily basis with the products Lundbeck produced in 2022

~2.4 million

Patients in treatment with ALK products in 2022

A RESPONSIBLE OWNER OF HEALTHCARE COMPANIES REACHING MILLIONS OF PATIENTS

As an owner and investor in the healthcare sector, the Foundation’s commercial activities are also part of its commitment to improving health and quality of life. While Lundbeck, ALK and Falck operate within different areas of

8.9 million

Services delivered by Falck in 2022

SUPPORTING RESPONSIBLE ECONOMIC GROWTH AND JOB CREATION

As the engaged owner of three international healthcare companies and a direct investor in 20 biotech companies, the Lundbeck Foundation has a significant responsibility to drive sustainable economic growth, job creation and to be a good employer, that can provide a good working environment for its employees.

RESPONSIBLE GROWTH IN THE HEALTHCARE INDUSTRY

Consolidated figures for the Lundbeck Foundation Group Revenue (DKKm)

35,426 Revenue growth 2021-2022 adjusted for Falck’s COVID-19 antigen testing activities in Denmark

9% Number of employees (FTEs)

28,086

As part of its engaged ownership, the Foundation contributes to SDG 8 through 8.1 (GDP growth) and 8.5 (Decent work for all men and women) as primary sub-targets.

The Foundation is the engaged owner of healthcare companies with total revenues of more than DKK 35bn and more than 30,000 employees. The Foundation has a responsibility for driving sustainable economic growth and ensuring a healthy and meaningful workplace for the employees.

Lundbeck, ALK and Falck each have strong people agendas, and each prioritises talent development, an inclusive culture and is committed to taking a data-driven approach to employee satisfaction via regular surveys.

In 2022, Lundbeck grew its revenue by 12% and ALK grew its revenue by 15% and delivered solid profit. For Falck, 2022 represented considerable change, as the year saw the closedown of the COVID-19 testing that boosted income in 2020 and 2021. As expected, this change led to a decline in total revenue, while Falck grew its non-testing revenue by 3%. Looking ahead, the Foundation is excited to support its new acquisition, FeMD, on its own growth journey.

A SPOTLIGHT ON THE EFFECTS OF LONG-TERM OWNERSHIP

The enterprise foundation ownership model combines commercial and philanthropic activities. While the model is widespread in Denmark, the general awareness of foundations –

and in particular the effects of long-term ownership models – is low. In 2022, the Foundation therefore collaborated with the Danish think tank, Kraka, to conduct and publish an in-depth analysis and comparison of companies with different ownership models. The study showed that companies with an enterprise foundation as their majority owner operate with a stronger focus on innovation and social aspects, such as talent development, employee engagement, pay equality and diversity. Read more here: https://lundbeckfonden.com/en/news/longterm-ownership-brings-solid-benefits-to-society.

CREATING A MEANINGFUL WORKPLACE

As part of the Lundbeck Foundation Group – also comprising three international healthcare companies – the Foundation is a small organisation. The 43 employees are the Foundation’s most important asset, and it is critical, especially for a purposedriven organisation such as the Foundation, to foster a healthy and meaningful working environment.

Having grown the organisation in recent years, the Foundation carried out an internal employee engagement survey in 2022.

The survey results underscored the need to work actively with the people agenda within the Foundation. As a consequence, the roles and responsibilities were reviewed and several new initiatives were set in motion to strengthen the culture further.

PIONEERING INNOVATION WITHIN HEALTHCARE

The Lundbeck Foundation invests in people, businesses and science at the frontiers of their fields, with the aspiration of pushing the boundaries of the current level of insights and knowledge, and identifying the health solutions of tomorrow.

INNOVATION AS A CORE PART OF THE OWNERSHIP MODEL

As part of the strategic ambition to own and develop leading healthcare companies, the Lundbeck Foundation views innovation as a core part of its ownership model alongside a rigorous focus on patient needs. The Foundation seeks to support its subsidiaries towards continuous innovation and research that can translate into the development of new medicines, treatments, and healthcare solutions.

For the two pharmaceutical companies in the portfolio –Lundbeck and ALK – this is directly evident from their substantial R&D spend.

For Falck, delivering breakthroughs in the healthcare service market is a key component of its strategy.

DOUBLING DOWN ON THE BELIEF IN DANISH BIOTECH

The journey from scientific discovery to healthcare innovation and new treatments is long and challenging, and requires considerable risk-willing capital. In its role as a venture capital and seed investor, the Foundation drives healthcare innovation through direct investments in biotech companies focused on the development of new innovative medicines and treatments in areas of unmet patient need.

DKK 3bn raised

by Lundbeckfonden BioCapital portfolio companies in direct investments and grants 2022

The contribution to healthcare innovation, both through its long-term ownerships and investments in early-stage biotech, is a key component of the Foundation’s impact on society, with a clear link to SDG 9 and sub-target 9.5.

increased investment mandate to seek out new Danish-based investments.

SUPPORTING IDEAS AT THE FRONTIER

Before an innovative idea can evolve into a potential investment opportunity, it has to be nurtured and thoroughly tested. Complementing the efforts of BioCapital, in 2022, the Foundation awarded its first ever ‘Frontier Grant’.

Total R&D spend 2022 (DKKm) R&D spend as % of revenue 2022

3,754 21%

The Danish biotech scene is full of talents, great ideas, and innovative companies, and the Foundation believes that the ecosystem has the potential to make an even bigger impact. As a single investor, the Foundation plays an important role, but Danish biotech also needs international investors to grow and prosper.

665 15%

To develop Denmark’s biotech community further, in 2022, the Foundation combined its two biotech investment teams, Ventures and Emerge, into one unit: BioCapital. This team will continue to work with the existing portfolio of both international and Danish biotech companies, with an

Frontier Grants target scientific research talents with research ideas that have commercial potential, but who needs support to mature their ideas to a stage of relevance for commercial investors. The grant serves a dual purpose of developing the concrete research idea while also mentoring research talents to increase their ability to navigate in a commercial space, both now, and in potential future endeavours.

The first Frontier Grant was awarded to a science project exploring an innovative approach to the treatment of Parkinson’s disease.

PROMOTING SUSTAINABLE PRACTICES AND GOOD GOVERNANCE

In its very different roles as owner, investor, philanthropist and public voice, the Lundbeck Foundation can use its influence to promote sustainable practices across environmental-, social- and governance-related dimensions.

A HISTORY OF GOOD GOVERNANCE

The Foundation has developed a strong focus on governance, based on four principles, which constitute the core of the Foundation’s approach: compliance, independence, transparency, and checks and balances.

Compliance

Independence

The footprint of the Lundbeck Foundation is primarily defined by the companies that it owns, the investments it makes, and the recipients of its grants. The basis for promoting sustainable development is the Foundation’s governance model.

Transparency

• As an enterprise foundation, the Foundation strives to comply with two Danish sets of recommendations on governance:

1) Recommendations on Foundation Governance, and

2) Recommendations on Corporate Governance.

• Where the Foundation does not comply with these sets of recommendations, this is explained and stated explicitly

• The Foundation is headed by the Board of Directors. Seven Board members, including the Chair, are independent. Four Board members are elected by employees in the subsidiaries

• Former executives of the Foundation and its subsidiaries cannot be appointed to the Foundation’s Board of Directors

• Only one Board member, and the Foundation’s CEO, can hold board memberships in a subsidiary of the Foundation

• The Foundation’s Chair cannot hold board membership positions in the Foundation’s subsidiaries

• The Foundation publishes its annual accounts in alignment with listed companies

• All key policies and governance documents are made public on the Foundation’s website

• Major decisions on philanthropic grants are communicated proactively via the website, social media and the media

Checks and balances

• The Foundation’s organisation and key processes are designed to prevent the concentration of decisionmaking power

• The majority of all grant-making decisions are subject to external reviews by international experts to ensure appropriate quality levels are met

THE LUNDBECK FOUNDATION’S GOVERNANCE PRINCIPLES

POLICIES AND WHISTLE-BLOWER SYSTEM

The Foundation has five policies guiding its activities: grant administration, investments, communication, tax, and remuneration. In 2023, the Foundation also plans to adopt a Sustainability policy.

The Foundation also has a whistle-blower system in place, which provides both employees and partners with a secure and confidential reporting channel that is managed by an independent provider. The whistle-blower system can be used to report concerns that involve legal or other serious risks to the Lundbeck Foundation. During 2022, no reports were made via the whistle-blower system.

A RESPONSIBLE ASSET MANAGER

By the end of 2022, the net wealth of the Foundation amounted to DKK 52bn. The largest part of this was invested in Lundbeck, ALK and Falck, however, a significant proportion (around DKK 22bn) was invested in a broad portfolio of shares, bonds and alternative investments (Invest). These investments were made with a dual purpose: to contribute to the further growth in the Foundation’s asset base, and to act as a ‘safety net’ in times of crisis, providing the Foundation with the ability to support its subsidiaries, and to ensure the ability to make annual grants totalling DKK 500m or more.

The Foundation’s investment policy balances risk with longterm value creation. All investments must comply with the Foundation’s environmental, social and governance (ESG) principles. An external screening is conducted twice a year by an external company – Sustainalytics – which screens the financial investments for issues related to the ESG policy, and develops an ESG status report, which is reviewed and approved by the CEO and the Investment Committee. In 2022, no investments were identified as being in violation of the ESG policy.

DIVERSITY AT THE LUNDBECK FOUNDATION

Complex problems are best addressed by diverse teams –combining diversity of gender, functional skills, competences, nationalities and other qualities. At the same time, diversity may lead to complexity if not embraced by strong and effective leadership. The focus on diversity therefore needs to be paralleled by a conscious leadership approach, and this awareness has led to organisational adjustments in recent years.

The Foundation’s Board of Directors comprises two women and five men, excluding employee representatives. This gender balance is in accordance with the guidelines on gender equality issued by the Danish Business Authority (‘Guidelines on target figures, policies and reporting on the gender composition of management’).

The Foundation’s Management Team counts two women out of a management team of seven, and the overall organisation counts 21 female employees out of 48 total employees. Gender diversity and inclusion will also remain critical focus areas for the Foundation in the years to come.

In 2022, the Foundation took measures to promote gender diversity in its grants administration. This was spearheaded by the launch of the first annual LF Scientific Enrichment Prize, established in 2021. This prize celebrates science leaders at Danish universities who champion diversity and inclusion in order to develop creative solutions to complex scientific problems.

The diversity focus was also reflected in the Foundation’s three subsidiaries, each of which has defined gender-balance targets for its senior management level. For ALK and Falck, the gender representation is in line with the Danish Business Authority’s guidelines. Lundbeck is on track towards their target to increase the share of the underrepresented gender.

TAKING A SHARED RESPONSIBILITY FOR THE ENIVRONMENT

Climate change is among the most important issues facing the planet. While the Lundbeck Foundation’s strategic focus is on health and innovation, it also recognises its shared responsibility to live and promote environmentally sustainable practices.

The Foundation’s climate footprint is primarily driven indirectly through its ownerships of Lundbeck, ALK and Falck, and it is therefore critical for the Foundation that these companies set ambitious targets.

A highlight of 2022 was therefore the commitment by ALK and Falck to define science-based targets. Lundbeck had its own targets approved by the Science Based Targets initiative in 2021.

The Foundation has taken the first steps towards measuring its Scope 3 emissions, focusing on emissions from airline travel as a starting point. A study was carried out to define a 2022 baseline of 152 tonnes in CO2 emissions and the Foundation decided to purchase high-quality carbon offset credits based on carbon removal projects to compensate for its travel activities.

The energy efficiency of the Foundation’s office building remains a continuous focus area. In 2022, the production from the Foundation’s solar panels covered 18% of its electricity use.

DATA ETHICS IN RESPONSE TO THE DANISH FINANCIAL STATEMENTS ACT §99d

The Data Ethics Policy for the Lundbeck Foundation (including Lundbeckfond Invest A/S) has been developed and approved by the Board. It is based on five principles:

• Human interests before commercial interest

Data utilised should ultimately have a human benefit. If there is a conflict between human and commercial interests, human interests should always prevail.

• Transparency

Data uses should be clear or easily explained. When personal data is utilised, the legitimate reason for doing so should be made clear, or properly informed consent should be obtained from all involved.

• Anonymisation

Data should be anonymised or pseudonymised unless personalisation is a requirement for achieving the targeted results.

• Autonomy

We believe that individuals should have control over the use we make of their data. Further, we do not use automated decision-making or artificial intelligence on data either provided or collected.

• Accountability and governance

Accountability is an integral part of responsible data use, and we go to great lengths to reduce the risks for the individual, and to mitigate undesirable social and ethical implications.

We endeavour to integrate data ethics into all our daily management and business decisions, including when acting as stakeholder in other concerns.

culture among employees that promotes openness and encourages the continuous improvement of processes and systems.

Please find the Foundation’s policy at the Foundation’s website: https://www.lundbeckfonden.com/en/policies.

Subsidiaries

For further information about Data Ethics Policy please see page 42 of Lundbeck’s Sustainability report 2022, page 24 of ALK’s Sustainability report 2022, and page 55 of Falck’s Annual report 2022.

Even with effective standards, policies and processes in place, data usage has the potential to lead to challenges, problems, and errors. We seek to prevent this by developing a positive

KEY ESG FIGURES AND SUSTAINABILITY RISKS

The Lundbeck Foundation provides an overview of its key ESG figures as part of its ongoing efforts to be at the forefront of transparent behaviour by foundations.

ESG KEY FIGURES

These key ESG figures are based on recommendations by the Chartered Financial Analysts’ (CFA) Society Denmark, the Association of Danish Auditors (FSR), and Nasdaq Copenhagen. They represent a first step in a process that, over the coming years, will enable the Foundation to provide stakeholders with further insights into the Foundation’s ESG profile by setting targets.

SUSTAINABILITY RELATED RISKS

Sustainability risks can be divided into three areas:

• Risks related to the grant activities of the Lundbeck Foundation

• Risks related to the investment activities (Invest and BioCapital)

• Risks related to the activities of the three strategic subsidiaries: Lundbeck, ALK and Falck.

Risks related to grants are handled via a thorough and detailed application process, which also includes international peer reviews, and risk assessments and mitigation efforts to avoid the misuse of donated grants, and to prevent scientific misconduct.

Risks related to the investment activities are managed via a thorough ESG process, as explained on page 9.

Risks related to the subsidiaries include risks related to the environment, climate change, human rights, social and employee conditions, and anti-corruption. Not all risks are directly relevant to the subsidiaries, but at a consolidated level, the Foundation experiences risks related to all areas, and encourages its subsidiaries to assess, evaluate and report on relevant risks in their respective annual reports and

as part of their sustainability reporting.

For an elaboration on the risks within the subsidiaries, please refer to the relevant pages in the Lundbeck (pages 7 and 29) and ALK (pages 14-15, 17, 22-24 and 26-27) individual sustainability reports, and Falck’s Management’s report (pages 32-47).

key figures overview for the Foundation

DEFINITIONS OF CALCULATIONS

REPORTING PERIOD

All reported data are covering a full year period (1 January to 31 December 2022) for the Foundation (Lundbeckfonden and Lundbeckfond Invest A/S). The calculations have been applied consistently for all the years presented. All KPIs reported in the Sustainability Report are gathered and aligned with the timeline for annual reporting of the financial data.

DATA QUALITY

We are committed to collecting the most accurate data. Nevertheless, it is not always possible to gain a fully aligned register of data, and estimations are sometimes necessary.

ENVIRONMENTAL DATA

CO2e Scope 2

Includes all indirect emissions related to the generation of acquired and consumed electricity and district heating. All consumed energy information is provided by our supplier as specific meter readings or invoices.

Energy consumption

Consumed energy is monitored by building-specific meter readings.

Renewable energy share

Share of renewable energy generated by our solar panels is monitored by building-specific meter reading.

Water consumption

Water consumption is monitored by building-specific meter readings.

SOCIAL DATA

Workforce

The workforce is calculated using the FTE-method, which consists of the total amount of ATP reported to the Danish

Tax Authorities divided by the standard ATP rate for a full time employee (FTE) per year.

Gender diversity, percentage of women in the workforce

Includes all permanent employees hired and paid directly by the Foundation. Gender is assigned as female or male. Gender diversity reported as female share of total workforce.

Gender diversity, percentage of women in the M anagement

T eam

Includes all women in the Management Team. Gender is assigned as female or male. Gender diversity in the Management Team reported as female share of total Management Team.

Gender pay ratio of men to women

Includes all permanent employees hired and paid directly by the Foundation. Gender is assigned as female or male. Gender pay ratio is calculated as the median of paid salary to male employees divided with the median of paid salary to female employees.

Employee turnover ratio

Includes all permanent employees hired and paid directly by the Foundation. Employee turnover ratio is calculated for both voluntary and involuntary departing employees.

Absence due to sickness

Includes all permanent employees hired and paid directly by the Foundation. Absence due to sickness is calculated as the number of full days for all employees, that are sick, divided to the total number of FTEs. Maternity leave is not included.

GOVERNANCE DATA

Gender diversity, B oard

The gender diversity in the Board is calculated as the total number of women elected divided by the total number of

members of the Board of Directors for the Foundation. Gender is assigned as male and female.

Board meeting attendance rate

The board meeting attendance rate is calculated as the number of board meetings, which each board member attends, divided by the total number of board meetings during the year. A specific overview of each board members attendance during 2022 is presented in the Annual report of the Foundation on page 36.

CEO pay ratio

Total CEO remuneration divided by the median of the Foundations employee remuneration.

Sustainability Report 2022

Ronetta Stokes

Living with migraine

Visit the Lundbeck website www.lundbeck.com

Photography

Frontpage and p. 2: from private collection

p. 4: Søren Svendsen

p. 12: Colourbox (center and right)

p. 13: EMHA

Design Make®

February 2023

Ongoing commitment to UN Global Compact Lundbeck is a participant in The United Nations Global Compact which we became a signatory to in September 2009. We would like to express our continued support for the Global Compact and hereby renew our ongoing commitment to the initiative and its principles. In addition to this report, we will disclose our progress using the new digital CoP platform in 2023.

About Lundbeck

Lundbeck is a global pharmaceutical company specialized in brain diseases

For more than 70 years, we have been at the forefront of neuroscience research. We are tirelessly dedicated to restoring brain health, so every person can be their best. We are committed to fighting stigma and discrimination against people living with brain diseases and advocating for broader social acceptance of people with brain health conditions. Our research programs tackle some of the most complex challenges in neuroscience, and our pipeline is focused on bringing forward transformative treatments for brain diseases for which there are few, if any, therapeutic options.

Ronetta, now 49, began experiencing migraine attacks in her teens, but it was decades before she received a diagnosis of chronic migraine and chronic intractable migraine with, and without, aura. Her migraine attacks start as a pulsing, throbbing pain in the front right side of her head. The pain then migrates to the back of her head, and she feels intense pressure and tension in her head, neck and shoulders. Nausea, dizziness and light

sensitivity soon follow. She also has noise sensitivity and hears a unique ringing in her ears –like the whooshing sound of flowing water. Constant and unrelenting. When an attack hit, all she wants is to pull a blanket over her head and retreat from the world. “I just want to be left alone with no noise, no light, just dark,” she explains.

Read Ronetta’s full story on Lundbeck.com

It’s not going to win; I’m going to keep fighting and being a warrior.

Migraine is going to have to learn how to deal with me.

Ronetta Stokes

Living with migraine U.S.

Danish Statutory Disclosure

LETTER FROM THE CEO

Resilience in unprecedented times

We live in unprecedented times, where within a few short years we have had to navigate our business through a global pandemic, a war in Europe, high levels of inflation, and other forms of global uncertainty. Making the right decisions to secure the long-term, sustainable future of our business has never been more important than in 2022.

Lundbeck will direct realized interest savings towards new sustainability-related initiatives focused on increasing access to brain health between 2022 and 2025.

2022 also marked the next step in our climate commitment journey. With this report we can present Lundbeck’s first low carbon transition plan for how we will reach our zero emissions target no later than 2050.

We are also proud to present strong progress against our near-term carbon targets and even higher ambitions for both climate and circularity.

At Lundbeck, we see brain health as being fundamental to good health over the course of an individual's life It does not simply imply the absence of a disorder, but also includes the ability for those living with a brain disorder to thrive.

Based on our deep understanding of what it is like living with brain disease, we argue that there is an urgent need to prioritize brain health It is estimated that brain disorders directly affect about half of the world’s population and cost up to 10% of the world's gross domestic product (GDP).

We say that there is no health without brain health. That is why we are tirelessly dedicated to restoring brain health, so every person can be their best. Delivering efficacious and safe medicines and investing in developing new treatments is our most significant contribution to society.

We have delivered on 2022 targets on creating positive outcomes through impactful partnerships with a number of advocacy, educational, and aid organizations.

Lundbeck recognizes that we can do better still with regards to finding innovative ways of making brain health accessible and affordable for all. In September, we announced a credit agreement concerning our existing EUR 1.5 billion revolving credit facility to incorporate sustainability-linked targets.

Our sustainability-linked loan is further evidence of our commitment to ensuring that sustainability runs through everything we do. By integrating environmental and social targets into our finance approach, sustainability benefits our cost of finance and underscores our commitment to our sustainability targets.

We have been successful in further strengthening our management of business ethics risk as well as launching our neurodiverse workplace commitment, just to mention a few important sustainability results in 2022.

We always strive to improve and, while we did not meet two of our 11 sustainability targets for the year, we have taken action to enhance the effectiveness and resilience of our action plans

I hope you will enjoy reading more about these and other initiatives in the report.

Deborah Dunsire President and CEO of Lundbeck

Our sustainability-linked loan is further evidence of our commitment to ensuring that sustainability runs through everything we do.

Sustainability Key Figures

ACCESS TO BRAIN HEALTH

BUSINESS ETHICS COMPLIANCE

98.6% employees completed the annual e-learning on the Code of Conduct.

+8 million

Our portfolio of products reaches more than 8 million people on a daily average1

CHEMICAL RECYCLING

65%

Recovery and reuse of the organic compounds used in chemical production.2

WOMEN IN MANAGEMENT

43.1%

Gender split for all people managers globally of 43.1% women and 56.9% men.

CLIMATE ACTION

▼29%

reduction in scope 1 & 2 carbon emissions vs. 2019 SBTi target baseline

▼3% estimated reduction in scope 3 carbon emissions vs. 2019 SBTi target baseline.

HEALTH & SAFETY

5.8

Frequency of lost time accidents per one million working hours for all employees globally.

Our Business Model

We are tirelessly dedicated to restoring brain health, so every person can be their best.

Our Material Impacts

This report covers the topics we currently consider to be the most material and important to our stakeholders, our business, and to society.

Four main societal challenges guide Lundbeck’s approach to sustainability. Our strategy aims to ensure that we mitigate our most significant sustainability risks and adverse impacts related to these challenges

Below is an overview of impacts, risks, and opportunities for the main material issues. This includes how they relate to the UN Sustainable Development Goals (SDGs).

Starting in 2023, we will be updating our sustainability strategy to align with the disclosure and due diligence requirement set out in the EU Directives related to corporate sustainability conduct and reporting. This will mean an extended process for assessing our impacts, risks, opportunities, and double materiality in our operations and in the value chain.

See the Sustainability Statements section of this report for disclosures regarding other material issues and how we manage them.

SOCIETAL CHALLENGES

Materiality aspects Unmet Patient Needs Business Ethics Climate Change & Circularity People & Communities

What are the main issues that Lundbeck can impact?

• Pressured healthcare systems

• Inequality and barriers in access

• Stigmatization of brain disease

• Neglected rare diseases

How does this represent a risk to our business?

If Lundbeck is not part of the solution to these challenges, it threatens our license to operate.

How is it an opportunity for our business?

When Lundbeck is successful in positively impacting these challenges in society, it benefits the people we are dedicated to help and our business’ financial value creation.

• Corruption and unethical marketing

• Increasing demand for transparency

• Patient safety and product quality

If we do not follow applicable rules and regulations, we risk losing public trust and our license to operate.

When Lundbeck maintains ethical business practices and respects rules and regulations, we safeguard patient safety, uphold stakeholder integrity, and minimize the risk of financial repercussions.

Which SDG is it related to?

• Transition to zero emissions future

• Scaling circular solutions

• Environment and biodiversity under pressure

If we do not minimize our impact on the environment in the entire value chain, we risk restrictions that can disrupt our production and supply to the detriment of patients.

When Lundbeck is taking a leadership position on climate action and continuously integrating circular solutions, we are making our business highly energy and resourceefficient and robust towards future transitional changes.

• Lack of gender equality

• Disrespect for human rights

• Lack of safe and inclusive working conditions

If we cannot retain and develop engaged and dedicated scientists and other staff, we will not develop new treatments for patients.

When Lundbeck is successful in maintaining a safe, inclusive culture, free of harassment and discrimination, it helps us remain a preferred employer and attract the best talent.

Sustainability Targets

Lundbeck has set a number of long-term 2030 aspirations that we present in the next sections of this report. We also set annual targets for our strategy issues

Below is an overview of how we performed on the 2022 targets and the targets we have set for 2023.

This year, nine out of 11 targets have been achieved or are on track

See the Sustainability Statements section of this report for more performance measures on a range of sustainability matters that we use to steer and monitor our progress

Issues 2023 target 2022 target SDG Impact

ACCESS TO BRAIN HEALTH

Scoping a global approach to measuring the impact of and access to medical education of health care professionals we are funding

Donate treatment for at least 1,500 patients in low- and middle-income countries through product donation partnership

BUSINESS ETHICS

Annual Code of Conduct training completed by all employees at work globally

Increase the share of employees stating in the annual ESS that they are confident in raising an ethical or compliance concern

CLIMATE ACTION

Reduce total carbon footprint across own operations, supply, and distribution in line with our 15-year near-term Science-Based Target1

ENVIRONMENTAL MANAGEMENT

Recycle 64% of the organic compounds used in chemical production

Recycle 73% of general waste

DIVERSITY & INCLUSION

Increase in share of underrepresented gender at senior management level year on year2

HEALTH AND SAFETY

Reduce lost time accident frequency ≤ 4

Not more than three high consequence work related accidents with absence

1) We report progress annually on our 15-year targets in Scope 1 & 2 (own produced energy and purchased energy) and Scope 3 (emissions from supply, services, distribution, and business travel).

2) Executive Vice Presidents, Senior Vice Presidents, and Vice Presidents

Ensure all disease awareness sponsorships measurably support brain health in general, mental health and suicide prevention, or migraine

Donate treatment for at least 1,000 patients in low- and middleincome countries through product donation partnership

Annual Code of Conduct training completed by all employees at work globally

Increase the share of employees stating in the annual ESS that they are confident in raising an ethical or compliance concern

Reduce total carbon footprint across own operations, supply, and distribution in line with our Science-Based Target1

Recycle 63% of the organic compounds used in chemical production

Recycle 70% of general waste

Build an even more inclusive organization with a specific 2022 initiative focusing on cultural awareness across the organization

Increase in share of underrepresented gender at senior management leve 2

Reduce lost time accident frequency ≤ 5

Not more than four high consequence work related accidents with absence

Achieved Not achieved On track

Unmet Patient Needs

Lundbeck is one of the few companies in the world exclusively committed to the extremely challenging space of brain health.

We see brain health as being fundamental to good health and aspire to help meet the unmet patient needs for brain health.

1 bn

800,000

people globally are estimated to live with at least one mental health disorder.1

people die by suicide every year: that’s one person every 40 seconds.

2030 ASPIRATION

• Leverage our specialist knowledge to address the burden of brain diseases and make efficacious medicine available

• Promote accessibility of our medicines by addressing discriminatory, physical, economical, and informational barriers

• Improve mental health parity, reduce stigma, support national suicide prevention efforts, and enhance cultural acceptability of brain diseases

• Provide high-quality medicinal products, safeguard patient safety, and combat counterfeit medicine

Unmet Patient Needs

PUTTING THE BRAIN ON THE AGENDA

One of the pharmaceutical industry’s most material sustainability issues is how the industry supports good health and wellbeing for all, leaving no one behind.

Brain health is under-prioritized despite its huge burden, especially when compared with other non-communicable diseases.

With more than 70 years of experience in developing innovative treatments for brain disorders, we are keenly aware of the many obstacles that can prevent an individual from achieving brain health. Whether it be genetics, age, race, sex, ethnicity, or socio-economic determinants of access to healthcare, understanding and fully evaluating the multitude of factors that influence a person’s health are key to both the development of good medicine and equitable advances in brain health.

Since adopting our Access to Brain Health strategy in 2020, Lundbeck has taken a number of proactive steps in our 2030 Access to Brain Health strategy

TRANSFORMATIVE TREATMENTS

Lundbeck works with our partners across the world to make sure more financial and humanistic resources are dedicated to brain health and its associated disorders. We also

partner with medical societies and advocacy groups to empower the voices of those with lived experience and educate policy makers on the importance of brain health.

Our focus on research remains the most important pillar in Lundbeck’s ambition to improve access to brain health, by making innovative treatments available. There is a significant unmet need in mental health and neurology, and we are committed to supporting those living with migraine and other neurological disorders. See more in our Annual Report 2022 on our scientific achievements in 2022, in our push to discover and develop transformative medications for niche and rare brain disorders.

AWARENESS AND ADVOCACY

Stigma continues to be a barrier to brain healththis should be addressed with education and awareness-raising campaigns. We want to normalize discussions about brain health and its associated disorders, and bring them to policy makers, to healthcare settings, to patient communities, and to society as a whole.

Partnerships are an important way of working for Lundbeck. Together with key stakeholder groups from different areas, we can do more and go further than we can on our own. Therefore, we prioritize our long-term partnerships.

Every year, Lundbeck partners with global and local patient advocacy groups and sponsors some of their impactful awareness campaigns in the areas of brain health, neurology, and mental health. In 2022, we sponsored 12 groups globally together with a multitude of local initiatives See three local examples on page 12 of this report.

EDUCATION IN BRAIN HEALTH

As a scientific leader in brain health, Lundbeck has a long history of providing evidence-based neurology and psychiatry educational material and training for healthcare professionals.

In the coming years, Lundbeck will be evaluating a global digital ecosystem enabling access to learning programs and measuring their global impact. This approach can provide adaptive and personalized learning opportunities for healthcare professionals based on their individual learning needs.

We will seek partnerships in the creation of and access to medical education, in order to ensure the highest standards in medical education. We believe that supporting healthcare professionals’ learning needs will ultimately support improving patient outcomes.

+8 million people

ACCESS TO BRAIN HEALTH

We estimate that more than 8 million people are reached on a daily average with the products Lundbeck produced in 2022 1

UNITED AGAINST STIGMA

World Mental Health Day is an important day to raise awareness and recognize the importance of mental health. At Lundbeck, we organize an annual global campaign on this day where we show our support, to help fight stigma and make a difference. In 2022, the theme was “United Against Stigma”, and Lundbeck encouraged all of our employees to help spread the word and participate in one of the many World Mental Health Day activities of our affiliates together with our local partners.

Every year, more than 800,000 people die by suicide. Many factors contribute to this devastating number. One datapoint is that an individual living with depression is twenty times more likely to die by suicide than someone without the disorder.1 At Lundbeck, we strongly believe that we need to talk more about suicide, address risk factors, leverage protective factors, and urge policymakers to improve healthcare systems.

One of the ways Lundbeck works to help spread awareness about suicide is supporting World Suicide Prevention Day. In 2022, the global

Status on sustainability targets

Creating Hope Through Action campaign aimed to inspire confidence and light in all of us that our actions, no matter how big or small, may provide hope to those who are struggling. By raising awareness, reducing the stigma around suicide, and encouraging well-informed action, we can reduce instances of suicide around the world.

SUPPORT FOR THE PATIENT’S VOICE

Another important advocacy activity we prioritize is the “patient’s voice”. Learning from people with lived experience, their families, and the healthcare community is of the highest value to us.

A main event during the year is Lundbeck’s #1VoiceSummit. It brings together the global and local patient communities to exchange ideas, collaborate, and partner up to find ways to amplify the voice of people with lived experience of brain disorders. In June, the event was held online and brought together nearly 130 participants from 60 patient advocacy groups from 15 different countries.

An example of our global advocacy sponsorships is the collaboration with the European Migraine & Headache Alliance described later in this report.

PRODUCT DONATION PARTNERSHIP

Through our partnership with International Health Partners (IHP), we can provide access to underserved communities and offer muchneeded support to those living with brain disorders.

In 2022, Lundbeck donated medication that is estimated to be able to help at least 4,000 people through charitable clinics in Lebanon, the West Bank, and Gaza. Lundbeck’s costs amount to approximately 1 million DKK to cover production, transport, and program support to IHP.

Manufactured to be donated, the medication provided by Lundbeck has enabled IHP to offer a targeted program in the region through its network of in-country partner charitable clinics. They aid the medical needs of some of the region’s most vulnerable communities who would otherwise have no access to treatment.

Medicine to Ukraine

In May 2022, Lundbeck also made an emergency product donation upon request from the Psychiatric Association of Ukraine in need of medical treatment for anxiety, severe depression, and psychosis for people distressed by the onset of the war.

The donated products were enough to treat at least 5,000 people

Read more on Lundbeck’s contributions to local communities in the People & Communities section on pages 24-27.

2022 TARGET STATUS COMMENT SDG

Ensure all disease awareness sponsorships measurably support brain health in general, mental health and suicide prevention, or migraine

Donate treatment for at least 1,000 patients in product donation partnerships in Low-Middle Income Countries (LMICs)

Achieved All 12 corporate sponsorships increased awareness of brain health, including one specifically focused on suicide prevention.

Achieved Donation via IHP for treatment of an estimated 4,196 patients in Lebanon, Gaza, and the West Bank.

See the Sustainability Statements section of this report for Access to Health key performance indicators.

EXAMPLES OF HOW WE HELP SPREAD BRAIN HEALTH AWARENESS IN THE COUNTRIES WE OPERATE

SUPPORTING THE LOCAL MENTAL HEALTH COMMUNITY IN KOREA

To raise awareness for World Mental Health Day (WMHD) and support the local community, Lundbeck Korea launched the “Green World Campaign”. One hundred and thirty psychiatrists participated in the campaign, and Lundbeck donated 13,000,000 KRW to the Hanwool Mental Health Care Center in Seoul - one of the largest in Korea. The center engages in social adaption and rehabilitation projects for people with mental disabilities. In addition, the center focuses on research and spreading awareness about mental health and social welfare.

MENTAL RELIEF FOR FAMILIES IN POLAND

The Presja is a nationwide project in Poland which offers mental relief to people through psychoeducation and psychotherapy. With the monetary support of 10,000 PLN from Lundbeck GBS Krakow, a campaign was launched in 2022 to overcome the alarming statistics of youth and child depression. Parents and their children in Poland were provided with several tools as part of the campaign. These included a free guide, which has reached over 1,000 people; 40 consultation hours for parents; support groups with the participation of 29 parents; and two webinars watched by 2,900 people, including Lundbeck GBS Krakow employees. The Presja focused, among other topics, on how to talk to children about war and help them cope with the fear and anxiety caused by the breakout of war in Ukraine.

TACKLING YOUTH DEPRESSION IN CHINA

Lundbeck China and Dogo, which is the largest patient organization focusing on major depressive disorders in China, have collaborated to produce an online Youth Development Program. It is a platform for young people with depression and offers a safe place to get support. The platform reached over 200,000 views during the WMHD campaign in October 2022. To further raise awareness about mental health, an advocacy video and livestream with a patient were hosted. Dogo and Lundbeck China have developed a Teacher Training Program with a free toolkit to enable schools to implement mental health as part of the curricula. Finally, "From Depression to Recovery" – a handbook for patients – was published this year in collaboration with Dogo; it is a valuable asset helping patients and their families to better manage the disease.

Lundbeck’s leadership in brain health and commitment to supporting the patient advocacy community has been instrumental for the European Migraine & Headache Alliance, and for those living with headache disorders.

We cherish our partnership with Lundbeck and are looking forward to continuing our work together.

Elena Ruiz de la Torre Executive Director, European Migraine & Headache Alliance

ABOUT THE PARTNERSHIP

The European Migraine & Headache Alliance profit umbrella organization including over 33 patient associations for and other headache disorders across Europe. The EMHA’s main advocate for the rights and needs of the estimated 138 million people in Europe living with headache disorders. Over the past years, Lundbeck has been closely partnering with EMHA on various projects to

empower the voice of those living with headache disorders. These have included a campaign on migraine in the workplace, granting Lundbeck a “migraine friendly workplace” stamp; a global awareness campaign on the importance of brain health and its links with headache disorders; and four national parliamentary meetings led by EMHA to engage policymakers and raise awareness on the gaps in access to migraine care.

Business Ethics

17

17 Regional Compliance Officers present in our affiliates in the Global Compliance Organization, alongside the Headquarter compliance functions, are dedicated to providing business ethics guidance to their colleagues

2030 ASPIRATION

• Promote business ethics, including human and labor rights through strengthened collaboration with key business partners

• Demonstrate that the Code of Conduct compliance program and organization work, i.e. that they sustain an ethical culture and prevent any form of corruption

• Protect the integrity of the healthcare professionals we work with and use transparency as an asset

At Lundbeck, we pursue our business purpose guided by the ethical principles in our Code of Conduct as a fundamental element of our sustainability strategy.

Business ethics is crucial to us as a pharmaceutical company. It is how we safeguard patient safety, uphold stakeholder integrity, and minimize the risk of financial repercussions.

Business Ethics

STRONG COMPLIANCE PROGRAM

We are a research-based biopharmaceutical company, and our products help thousands of people daily. Because of the sensitive nature of our business, society’s expectations are high and constantly evolving

Lundbeck’s well-established Code of Conduct conveys our ethical commitments and the expectations we have to our employees for areas that are critical to the industry.

During 2022, we reinforced the Compliance Program, which is designed to ensure that we uphold our Code of Conduct. The Compliance Program sets actions in an improvement cycle, initiated by the annual management review conducted by our compliance committee. The review draws on multiple data points, e.g. external trends, new regulations, systematic risk interviews with key people, audits, investigations, and other monitoring activities. The process defines the top priorities for the coming year, which are endorsed by the compliance committee representing Executive Management and key compliance and legal functions in our headquarters.

The year also entailed increased resource spending on managing sanctions on Russia and strengthening our fraud management.

GLOBAL AND LOCAL COMING TOGETHER

Since 2021, our compliance organization led by Lundbeck’s Chief Compliance Officer consists of headquarter functions and the 17 Regional Compliance Officers who serve our affiliates globally. The organization is truly global, representing multiple perspectives, capabilities, educational backgrounds, and cultures, which gives excellent conditions for providing solutions that are fit for global use.

In May 2022, we gathered the members of the Global Compliance Organization in person in Copenhagen for a two-day Compliance Summit.

In the opening address from CEO Deborah Dunsire to the Regional Compliance Officers, she emphasized that they are role models for colleagues, promote openness, listen, and help sustain our ethical culture, so that we can “act with respect and integrity in everything we do”.

One outcome from the Summit was establishing a set of specific metrics to support and align global implementation of our Compliance Program across all our commercial business areas and corporate functions.

Another result was defining the overriding theme and topics for the global Code of Conduct elearning that is assigned and completed by all employees annually.

MAKING ETHICS EVERYBODY’S BUSINESS

We invest heavily every year in developing training and awareness activities that can transform Code of Conduct principles into ethical actions.

The annual compliance training aims to empower our employees to make informed and responsible decisions. This year it also reiterated that Lundbeck as a company is built on our great people and culture. This was expressed in multiple video statements where colleagues shared their personal and professional perspectives on how Lundbeck’s five beliefs: patient-driven, courageous, ambitious, passionate, and responsible, help them in doing the right thing.

Under the theme “Doing the right thing” and a set of fictitious cases, our employees practice the application of key principles in the Code of Conduct. All people managers were asked to lead local discussions on what “Doing the right thing” means to their teams.

The business ethics compliance training is supplemented by our audits and monitoring efforts that aim to validate the understanding of the requirements and capture suggestions for improvements of processes and controls.

98.6% BUSINESS ETHICS COMPLIANCE

98.6% employees completed the annual e-learning on the Code of Conduct.

Specific feedback is provided to ensure local management ownership and follow-up.

We encourage everyone to have ongoing dialogue on compliance and ethics with their colleagues and manager. However, we realize that some questions, dilemmas, or concerns might not be discussed openly.

Our Compliance Hotline is a secure line that is open for everyone to raise concerns about a potential violation of the Code of Conduct. It is a cornerstone in our Compliance Program that helps protecting Lundbeck.

In the course of 2022, 78 compliance hotline reports were made and received Compliance Hotline reports were aggregated by case prior to 2022, but with our new accounting policy, each report is now reported unaggregated. The aggregated number is 27 compared to 21 in 2021.

All reports are investigated in line with our global procedure that safeguards individuals who report concerns, participate in investigations, or are suspected of misconduct

Status on sustainability targets

In 2022, our internal functions also conducted 129 due diligence screenings of third parties and suppliers to identify and mitigate 29 specific risks in relation to suppliers and third parties.

TARGETS FOR PERFORMANCE

We have set a target that the annual Code of Conduct training must be completed by all employees at work globally every year. We consider this target achieved in 2022 with a global completion rate of 98 6%.

Our second target for the year was to increase the share of employees stating in the annual Employee Satisfaction Survey (ESS) that “they are confident in raising an ethical or compliance concern”. We also consider this target achieved, as the share remains high and slightly increased from 86.7% in 2021 to 86.9% in 2022.

TRANSPARENT INTERACTIONS WITH HEALTHCARE PROFESSIONALS1

We take pride in being committed to transparency by following our global procedures that respect applicable laws and self-regulation from the industry associations we have joined. One of those is the European Federation of

Pharmaceutical Industries Associations (EFPIA).

Under the EFPIA Code, we disclose the transfers of value we make to individual healthcare professionals, healthcare organizations, and patient organizations on a yearly basis. In countries subjected to disclosure requirements, Lundbeck made reasonable effort to obtain consent from the Healthcare Professionals or Healthcare Organizations to publicly disclose payments and other transfers of value. In comparison to year 2020 (reported in 2021), in 2021 (reported in 2022), the overall consent rate increased by an average of 5%.

In 2022, we updated our Guideline on Interactions with Healthcare Professionals, Healthcare Organizations, Patient Organizations, and Patients, and our Global Standard Operating Procedure for Transfers of Value to the same stakeholders. The purpose of the update is to make global requirements around transparent interactions more operational, including the rules on needs assessment and fair market value methodology. All affiliates must follow our global principles and minimum standards approach, even when local regulations are less restrictive.

DATA PRIVACY

gathered in Copenhagen for a full-day of GDPR workshops, engagement, and knowledgesharing. The main focus this year was on the continued, complex management of all International Data Transfers by performing Transfer Impact Assessments (TIAs).

SAFE AND EFFICACIOUS PRODUCTS

Patients are always our main concern. A concern of the patients is to have access to safe medical products of high quality. The lack of available, safe medicine can also be a barrier for health.

Patient and product safety is paramount to Lundbeck. We take stringent measures to secure our supply chain and ensure that genuine Lundbeck medicines reach patients every time. As an example, in 2022, we conducted 216 patient and product safety audits through collaboration with partners and internally.

2022 TARGET STATUS COMMENT SDG

Annual Code of Conduct training completed by all employees at work globally

Achieved Annual training launched in December. Achieved a 98.6% completion rate. We consider above 98% to be achieved.

Lundbeck is committed to safeguarding the data privacy rights of patients, research and business partners, and our employees.

In November this year, Data Protection Managers from HQ and EU/EEA affiliates

Increase the share of employees stating in the annual Employee Satisfaction Survey (ESS) that they are confident in raising an ethical or compliance concern

Achieved Share remains high and slightly increased from 86.7% in 2021 to 86.9% in 2022.

1) Any member of the medical, dental, pharmacy, or nursing professions or any other person, who in the course of his or her professional activities may recommend, prescribe, purchase, supply, administer, or otherwise influence the purchase or prescription of a medicinal product.

See the Sustainability Statements section of this report for Business Ethics key performance indicators.

Climate Change & Circularity

Lundbeck has for many years demonstrated our commitment to circular economy principles and cutting emissions. This year, we present a new low-carbon transition plan to take us all the way to zero emissions.

Lundbeck was awarded an “A” score by the Climate Disclosure Project (CDP). Only 292 companies globally achieved this result in 2022.

This is the 8th consecutive year Lundbeck has achieved a CDP Leadership score.

2030 ASPIRATION

• Establish manufacturing processes based on circular economy principles to limit materials use, waste, and carbon emissions

• Expand application of circular economy principles to key partners

• Use detailed knowledge about active pharmaceutical ingredients to minimize environmental impact

2030 ASPIRATION

• Deliver on the “Business Ambition for 1.5°C” pledge

• Transition electricity supply to renewable sources

• Manage two-thirds of value chain carbon emissions equally as effectively as carbon emissions from operations

• Minimize key business partners’ carbon emissions reflected in relevant agreements

Climate Change & Circularity

COMMITTED TO CLIMATE ACTION

Climate change is undoubtedly one of the largest shared challenges faced by our planet. Lundbeck is committed to making the necessary reductions in emissions across the entire value chain to keep global warming to a maximum of 1.5°C.

In 2022, we updated our 15-year climate target in accordance with the new Science Based Targets initiative (SBTi) Net Zero Standard and submitted it in December.

SCOPE 1 & 2 EMISSIONS

Site power and heat together with our company cars make up our scope 1 & 2 emissions. Since 2006, we have cut more than 80% of the emissions from our sites. This means we must be very innovative to reach the new near-term target of 65% reduction in 2034 compared to 2019.

On January 1st 2022, the newly built solar park was connected to the Danish grid, supplying 100% renewable electricity to Lundbeck. The electricity provided by Better Energy through a power purchasing agreement covers all

consumed electricity at Lundbeck's Danish sites This is the main reason why our scope 1 & 2 emissions have already been reduced by 29% compared to our baseline year in 2019. We will in the coming years continue our efforts in converting to renewable electricity globally.

Overall, our scope 1 emissions decreased from 2021 to 2022 due to reductions in emissions from our fleet of company cars. New company car policies will be implemented at regular intervals to account for the fast pace of technological advances and regulation in this area.

We did however see an increase in scope 1 emissions from power and heat due to challenges relating to the very limited availability of certified bio-oil at an acceptable price point in 2022. We have resorted to using some noncertified bio-oil as well as gasoil. This is not a desired situation, as we have completed the conversion of our technology to use bio-oil. Looking ahead, we are exploring possibilities for converting our use of fossil-based gas at our production sites to electricity or renewable fuels like biogas

EMISSIONS IN OUR VALUE CHAIN

Our biggest footprint outside of our fence –scope 3 emissions – stems from purchasing goods and services such as clinical trial management, marketing, raw materials and packaging, distribution, and business travel. This year we have improved our emissions estimation model and raised our near-term target to achieve a 40% reduction in 2034 compared to 2019. We have also increased our clinical trial management and other servicerelated purchasing as part of our business strategy, and estimated emissions are up 7% since 2019.

We are pleased to report a decrease in overall scope 3 emissions1 of 3% compared to the baseline year of 2019. This is in part due to lower emissions from business travel, which are

Status on sustainability targets

up 170% compared to 2021, but are still 47% lower than those in 2019. We can also report a 22% reduction in emissions from up-stream transportation and distribution compared to 2019.

We work in collaboration with our suppliers and help them to reduce emissions and receive emissions data, improving the data quality to estimate our carbon footprint. To establish knowledge about our suppliers’ climate action, we have submitted a survey to our top 300+ suppliers in the first part of the year.

The information gathered in the survey was used to plan the roll out of a climate contract addendum to existing suppliers, asking them to commit to using renewable electricity and supply climate data to Lundbeck. All corporate

procurement managers and employees have been trained in introducing the addendum according to the roll out plan. In addition, climate criteria are being included in the future selection of suppliers and new contracts. One of our largest groups of suppliers are Clinical Research Organizations (CROs) performing clinical trials on behalf of Lundbeck. Climate action is now introduced in the governance

charters that are discussed with the CROs annually.

NEW LOW CARBON TRANSITION PLAN

Lundbeck has a long-term ambition to reach net zero emissions as defined by SBTi, no later than 2050. In 2022, our climate strategy working groups have developed a transition plan that describes levers and milestones. Any residual GHG emissions that cannot be eliminated by

OUR TRANSITION PLAN TOWARDS NET ZERO

reducing emissions must be neutralized by carbon removals

Based on the already known reduction possibilities, an estimate for residual emissions that must be neutralized by carbon removals is 20 to 30% of our total emissions (scope 1, 2, and 3). We do expect that technological advancement will make it possible to reduce this residual. We will continuously track the need for carbon removals, adjusting for evolvement in

local emission factors and supplier specific emission data.

The transition plan was approved by Lundbeck’s Executive Management in November. The transition plan follows the guidance in the Carbon Disclosure Project (CDP), Taskforce on Climate-related Financial Disclosures (TCFD), and the new European Sustainability Reporting Standard (ESRS).

BUSINESS TRAVEL IS NOT BUSINESS AS USUAL

ENGAGING OUR EMPLOYEES

In 2021, Lundbeck’s Executive Management approved a global travel policy, covering an area that had previously been managed locally.

To ensure internal compliance with this new policy, we are working with both strong governance in the Climate Steering Group, reduction targets cascaded out into the organization to all key managers and employees, and not least with employee engagement. Training and engagement with all employees continue to be pivotal to how we work with sustainability.

In 2022, the policy implementation was initiated with workshops for affiliate procurement managers on how to implement the policy.

We also ran a global campaign on how to “Reimagine business travel” to encourage employees to embrace new travel habits and implement the three steps - (re)think, (re)plan and (re)act. Lundbeck’s internal communication channels were utilized to spread the word to all affiliates around the world. Articles, infographics and memes were posted as inspiration to take action, and the campaign elements had an internal reach of 10,000 views globally.

This was an important initial step for Lundbeck to reduce scope 3 emissions related to business travel, and thereby move towards our target of becoming a zero emission company.

Infographic from Lundbeck’s employee engagement campaign on how to "Re-imagine business travel" in 2022.

65% RECYCLING CHEMICALS IN PRODUCTION

We outperformed the target to recover and reuse 63% of the organic compounds used in chemical production. Targets are set annually based on expected production volume and mix.

CIRCULARITY IN RESOURCE FLOWS

Over the years, we have refined the skills and technical capabilities of our chemical production to increase recycling of organic compounds and reduce hazardous waste. As can be seen from the KPIs in our Sustainability Statements, Lundbeck’s finished goods and chemical production have increased in volumes by 5% and 18%, respectively, from 2020 to 2022. In the same period, we managed to reduce our raw material use by 15%.

We set targets each year to improve the recovery and recycling of chemicals used in our production. For 2022, we are proud to report that we achieved 65% recovery of the organic compounds used in chemical production. That means that we outperformed the target to recover 63%. This year, recovery of the palladium used in one of our major processes reached 75%, which is a record high. The recycling of palladium has a substantial impact on CO2e reductions and limits the use of a rare earth metal.

We have applied green chemistry principles broadly for many years in Lundbeck, yielding several circular savings in our Active Pharmaceutical Ingredient (API) production, improving both yield and quality, and decreasing the use of reagents, catalysts, and solvents.

In 2022, we have managed to substitute dichloromethane with toluene in another two of our production processes. We are very pleased with this achievement, as dichloromethane is unwanted in both the environment and in our working conditions.

WASTE AND RECYCLING

We have been consistently recycling a substantial amount of our general waste over the past several years In 2022, we began benefiting from our 25 million DKK rebuilding of the packaging plant airlock at the Valby site in Denmark, allowing for more efficient waste sorting of packaging materials and increasing the recycling of cardboard from production by 10 tonnes in this initial year.

We also conduct audits of our production and packaging sites to reduce waste. This year, this led to us starting in April 2022 to recycle plastic trays for one of our main products in pharmaceutical production in Valbonne, which is estimated to recirculate more than 5 tonnes of plastic.

Despite our good waste initiatives, we have unfortunately not reached our recycling target for general waste in 2022 of 70% recycling. We achieved 66% recycling.

At our site in Valbonne, leaflets and cartons were mistakenly sent to incineration instead of recycling. Our site in Valby has undergone renovation of the employee canteen for over six months, which has resulted in increased use of

Status on sustainability targets

disposable packaging and a lack of sorting of food waste at the temporarily established street kitchen

We have several new initiatives ready for 2023, including expanded office waste sorting and increased sorting of plastic drums and laboratory glass. We remain committed to increase general waste recycling in 2023 with a recycling target of 73%.

WATER MANAGEMENT

We work continuously to reduce our wastewater and have significantly done so over many years with technological improvements and various optimization activities at our production sites.

In 2022, an in-depth water assessment and flow identification were conducted at all our production sites. A number of gaps related to metering have been identified, and actions are planned to rectify this within one year. A working group across all sites has been formed and in 2023, Lundbeck will develop a new strategy for water usage including targets and action plans.

ENVIRONMENTAL MANAGEMENT

In 2022, we had our health, safety, and environmental management system re-certified

Chemical recycling

with very good results. Few deviations were given (6), and all were corrected prior to receiving the new certificates. Information about deviations has been shared across sites to prevent similar situations at the other sites.

For 2022, we are pleased to report that we did not have any incidents with an impact on the environment that we had to report on in

accordance with the terms of our environmental permits.

We had one environmental incident without an impact on the environment and a decrease in near misses to 37 compared to 42 in 2021. We take every incident very seriously, and thorough root cause analysis has been carried out in each case to learn and prevent repetition.

SOIL POLLUTION

In 2022, a study revealed that nearly 15,000 sites in Denmark might be contaminated with per- and polyfluoroalkyl substances (PFASs). Only eight percent thereof have so far been systematically investigated.

PFASs are synthetic chemicals used for production in many industrial applications

worldwide. The use of PFASs is being gradually reduced due to increased evidence and awareness of its harmful effects on human health and the environment. PFASs consist of several derivatives, where some are globally regulated – one of them being PFOS, which has been widely used in fire extinguishing foam, among other things, until banned.

Lundbeck’s Lumsås site used fire extinguishing foam containing PFOS until 2011 when we switched to a supply of alternative fire extinguishing foam in compliance with regulation.

Ten years later, the Danish Environmental Protection Agency (EPA) asked Danish companies to investigate any remaining traces of PFOS. Lundbeck’s investigations found traces of PFAS derivates in the soil at the facility in 2022. Further testing led by the Municipality found PFOS in adjacent fields

Lundbeck continues to collaborate fully and openly with the authorities on this matter, as well as engage with neighbors and the municipality to address concerns in the local community.

See the Sustainability Statements section of this report for Climate and Energy, Circularity and Environmental management, and key performance indicators.

People & Communities

5,400

Our 5,400 employees are our most important and critical resource.1

2030 ASPIRATION

• Be recognized by employees and externally as a workplace with an inclusive culture that offers equal opportunities for all

• Influence the public debate on equality and inclusion by setting ambitious targets, enhancing data transparency, and communicating actively

• Request key business partners to promote diversity and prevent discrimination in all its forms

2030 ASPIRATION

• Be recognized as a workplace that fosters physical and mental wellbeing

• Show leadership to promote mental health with preventive actions at our workplaces globally

• Achieve a lost time accident frequency below 3

Everywhere we operate, we strive to make a positive contribution to the people & communities we touch. This means safeguarding and developing our employees, taking action on gender equality and unconscious bias, and contributing to the communities where we do business.

People & Communities

BUILDING AN INCLUSIVE ORGANIZATION

At Lundbeck, we are committed to building an even more inclusive organization. We firmly believe that by fostering an inclusive work environment that integrates and empowers people of different backgrounds, skills, and perspectives, we ignite innovation and catalyze an even better performance across the company.

We believe that if we build an inclusive organization, diversity will follow. Diversity is an asset for both business and employees in its capacity to foster innovation, creativity, and empathy in ways that homogeneous environments seldom do. Lundbeck wishes to demonstrate leadership when it comes to inclusion and understanding of neurodiversity.

D&I MILESTONES

We launched our first 2-year D&I plan in January 2020 with the overall ambition of building an even more inclusive organization. Our focus has continuously been to create awareness on diversity and inclusion, and set up inclusive structures and processes.

We launched two e-learning programs mandatory to all employees – one on unconscious bias and one on cultural

awareness – additionally, we presented our commitment to be a neurodiverse workplace.

We have succeeded in implementing all initiatives in the plan, and based on this, we will therefore continue the work in 2023. One initiative was the unconscious bias training outlined earlier, and throughout the year we have worked through our processes and focused on hiring with gender balance in mind.

A new 2-year D&I plan will be kicked off in January 2023 and will have an overall goal of progressing further on diversity and inclusion in Lundbeck.

UNCONSCIOUS BIAS AND CULTURAL AWARENESS

In the first half of the year, we ran an e-learning on unconscious bias for all employees in 50+ countries intended to create awareness of what unconscious bias is, what to be aware of, and how to act and reflect on our biases including gender bias. The objective of the course was for all employees to become better at addressing their biases and in that way, help build an even more inclusive workplace.

In the second half of 2022, all employees received training in cultural awareness. The training gave employees insights into cultural

differences across different countries. By acknowledging our diverse cultural backgrounds, we can create a language around our differences that can help us better understand each other and enhance collaboration.

SUPPORTING A NEURODIVERSE WORKPLACE

As a leader in brain health, we are committed not only to raising awareness and improving conditions for people living with brain diseases across the world, but also to promoting an inclusive workplace and culture for our own employees living with a neurodiverse condition, so they feel supported and can thrive at Lundbeck.

In 2022, we launched our neurodiverse workplace commitment, which includes guidelines that cover how Lundbeck will foster the best possible work conditions for employees who have variations in their cognitive profile.

A neurodivergent person is someone whose neurological development and state are different from what is considered typical. This also includes those who live with a neurological, psychiatric, or neurodevelopmental disorder, whether diagnosed or not. This includes employees living with migraine, depression,

All people managers

Senior managers

GENDER BALANCE

From 2021 to 2022, we have increased the share of women among all people managers as well as in our Senior Management.

anxiety, ADHD or those on the autism spectrum, to name a few.

GENDER EQUALITY

For some years, we have measured the gender distribution in managerial positions. We have a long-established aim to maintain an overall equal gender split for all people managers globally.

To ensure progress on balanced gender representation and on other diversity dimensions, we have in 2022 continued to review and strengthen our policies, processes, and programs. In our recruitment processes we have built structured approaches to mitigate biases and ensure diversity in talent joining Lundbeck. In our organizational review processes, succession planning, leadership programs and more we have continued to monitor and promote diversity in our talent pool and for promotions In 2022, the proportion of female managers was 43.1% and the gender split for all employees was 53.7/46.4% female/male.

Status on sustainability targets

For 2022, we set a target to increase of the underrepresented gender at the management level, including EVPs, SVPs VPs. We have increased the share from 3 as of end 2021 to 33.8% at end 2022 and thus achieved this year’s goal. For 2023, we have set a target to increase the share of underrepresented gender at the senior management level year on year

Lundbeck's Board of Directors and Executive Management have set targets for a balanced gender representation for board members elected by the shareholders as well as for Upper Management defined as Executive Management and their direct reports with people management responsibilities. The target is to maintain balanced gender representation in accordance with Danish legislation. In 2022, there were two female board members out of seven members elected by the shareholders. Two out of four board members elected by Lundbeck’s employees were female. In 2022, there were 21 female members out of 50 in Upper Management.

2022 TARGET STATUS COMMENT SDG

Build an even more inclusive organization with a specific 2022 initiative focusing on cultural awareness across the organization

Achieved Global e-learning on cultural awareness launched in October mandatory for all employees.

New D&I 2-year plan 2023-2025 in place.

Increase in share of underrepresented gender at senior management level

Achieved We have increased from 32% end 2021 to 34% end 2022 and thus achieved this year’s goal.

Image from one of the videos on "Office Ergonomics" that Lundbeck developed and launched globally in 2022.

ACCIDENT PREVENTION

Lundbeck has seen a slight decrease in workrelated accidents with absence amounting to 21 this year, compared to 24 last year. We were, however, not successful in reaching our 2022 target of a frequency of lost time accident rate below 5, with a rate for the full year of 5.8.

Three of the 21 accidents are categorized as high consequence, which is 50% lower than 2021. Our target for 2022 was to have no more than four such accidents. Each accident has been root cause analyzed, and the preventive actions mandated by our HSE Council have been implemented.

Based on analyses of previous years’ accidents, we have identified trends of accidents related to ergonomics (e.g. lift, over-exertion) as well as injuries from trips, slips, and falls. Plans for preventive actions have been set up and executed at the local sites.

At our Valby site in Denmark, we eliminated heavy lifting and conducted training in one of our production areas, with the outcome that we have not had any accidents related to ergonomics in 2022. The previous year we had three high consequence accidents related to

Status on sustainability targets

ergonomics. Unfortunately, we have seen an increase in ergonomics-related accidents at our site in Lumsås this year (six accidents with absence). A revised accident prevention plan will be implemented in 2023, including local training in correct lifting and safety culture.

At our Valbonne site in France, mapping of risks and reinforcing a safety conscious culture in sterile production has led to a reduction in accidents from eight in 2021 to three accidents in 2022.

SYSTEM SUPPORTING WIDER SCOPE

A new cloud-based health and safety management system has been implemented in 2022, making it easier to report accidents, near misses, and dangerous observations. It also allows for timely and targeted preventive actions that can be followed closely on automated dashboards.

In 2023, the system will be used to roll out the accident data collection to all our sales affiliates. Until now, Lundbeck’s sales affiliates (approximately 3000 employees) have not been in the scope for global reporting. In 2022, we did a successful pilot on the data collection, and the frequency including sales affiliates was

estimated to be 2.9 per one million working hours (27 accidents with absence).

HEALTH & WELLBEING

To prevent aches, pains, and work-related diseases among administrative employees, we globally launched videos on "Office Ergonomics" in 2022. The videos provided guidance on how to set up the workplace in the office and at home in an appropriate ergonomic way. Inspiration for how to vary working posture and do exercises during the day was also presented in the videos.

In 2022, we successfully conducted stress management courses for both employees and managers in Denmark. Based on a positive evaluation, we will continue with similar initiatives in 2023.

MIGRAINE FRIENDLY WORKPLACE

A concrete example of how we work to ensure good working conditions for our neurodiverse employees is our focus this year on people living with migraine.

Lundbeck received its stamp for being a migraine friendly workplace in 2022. The European Migraine and Headache Alliance awarded Lundbeck with the stamp because of existing initiatives and our commitment for neurodivergent employees and migraine guidelines for managers.

2022 TARGET STATUS COMMENT SDG

Reduce lost time accident frequency ≤ 5

Not achieved We were not successful in reaching a target rate below 5, with a rate for the full year of 5.8.

Not more than four high consequence work-related accidents with absence Achieved Three of 21 accidents have been categorized as high consequence

The goal of the stamp is to recognize companies as “friendly” migraine work environments committed to migraine disease and employee wellbeing by creating awareness and understanding of migraine.

See the Sustainability Statements section of this report for People key performance indicators.

PART OF LOCAL COMMUNITIES

Everywhere we operate, we strive to make a positive contribution to the people and communities we engage with.

We condemn the war in Ukraine and Russia’s invasion of a free and democratic nation, and we stand united with the people of Ukraine.

Our main priority has been and will continue to be to take care of our colleagues and patients that are innocent people in the midst of war, both in Ukraine and Russia. We hope for a peaceful end to this war soon.

Early in 2022, we donated 10 million DKK (approximately 1,500,000 USD) to the Danish Red Cross to support emergency relief efforts. Further, we have explored different ways to donate essential medicines to the people who rely on them.

This is just one example of how Lundbeck is an integral part of the communities in the more than 50 countries in which we operate.

PAYING OUR TAXES

Through direct and indirect tax payments, businesses are an important source of revenue for governments and municipalities. Without them, sustainable communities cannot be built.

Lundbeck considers a fair tax policy and a robust management of this policy as part of our sustainability commitment. It is our policy that we pay tax where we make our profit and to offer transparency to stakeholders through reporting.

Lundbeck’s tax policy is reviewed and approved by our Board of Directors annually. In the policy, we disclose country-by-country level tax for countries classified as tax havens by the IMF and EU.

Complying with tax rules can be complex, as the interpretation of legislation and case law may not always be clear and may change over time. We aim to always comply with the letter of the law as well as with the legislators’ intention with the law, while managing a competitive effective tax rate.

For instance, we pay close attention to transfer pricing requirements and focus on pricing the value of these intercompany transactions on an arm’s length basis, according to best practice guidelines issued by the OECD. The guidelines ensure that profits are taxed in the country where the economic activities generating the profits are performed and where the value is created.

2022 CORPORATE TAX PER REGION

2022 corporate tax amounts to DKKm 5741 of that, our ten largest markets account for DKKm 418 (73%) and the rest of the world accounts for DKKm 156 (27%)

1) Profit before tax and corporate income tax are disclosed before elimination of intragroup transactions such as tax free dividends and value adjustments of tax assets and therefore differs to the consolidated figures in the Annual Report.

2) The Danish Corporate Income tax is impacted positively by tax free dividends from subsidiaries and by Research and Development Incentives. During 2022 H. Lundbeck A/S invested DKKm 3,428 in Research and Development.

Sustainability Statements

General Disclosures

LUNDBECK IN BRIEF

Lundbeck is a global pharmaceutical company with its head office in Denmark, doing business in more than 50 countries, with research facilities in Denmark and the U.S., and a vertical production set-up in Denmark (two sites), Italy (one site), and France (one site).

SUSTAINABILITY GOVERNANCE AND MANAGEMENT

Sustainability on a corporate level is managed by Corporate Compliance & Sustainability, and on a topical level by relevant functions and subject matter experts. The Executive Management Group is the steering group for the sustainability strategy, and a share of their short-term incentive program is linked to performance on targets related to the sustainability strategy, described in our Remuneration Report.

SUSTAINABILITY STRATEGY

Lundbeck’s sustainability activities aim to mitigate material risks and adverse impacts related to our business activities and to contribute to solving societal challenges where we can. We remain committed to the UN Global Compact Principles (Lundbeck became a signatory in 2009) and contribute to addressing seven of the UN Sustainable Development Goals.

MATERIAL ISSUES AND STAKEHOLDERS

With growing interest in ESG in the financial sector, investors and financial institutions are important stakeholders for us. However, equally important to our ESG and sustainability work are stakeholder groups such as employees, civil society organizations, healthcare professionals, healthcare organizations, patient organizations, communities, suppliers, and third parties. Listening and responding to our priority stakeholders is a core part of our materiality assessment. See our material issues on page 7.

Lundbeck has joined The Biopharma Sustainability Roundtable, a sector-specific platform designed to connect and support senior biotech and pharma executives in driving their Biopharma sustainability agendas forward. The Roundtable also conducts focused investor dialogue where Roundtable participants discuss sustainability strategy and ESG performance disclosure directly with capital markets representatives.

RISK MANAGEMENT

Lundbeck has several processes in place to ensure that corporate risks are assessed, reviewed, and mitigated. Sustainability, business ethics, and compliance are a part of Lundbeck’s Enterprise Risk Management framework described in the Annual Report. These topics and the related risks are reported regularly to the Audit Committee and Board of Directors.

Every year, Lundbeck’s Compliance Committee reviews and approves the Code of Conduct Risk Register covering approx. 25 individual risk titles. The review is based on interviews with internal compliance specialists across our global organization and various documented sources, including reported external trends, new regulations, internal audit findings, and Compliance Hotline reports.

The outcome of the annual Risk Register review is a list of mitigating actions that are endorsed by the Compliance Committee to continuously improve the Code of Conduct Compliance Program.

FOUNDATION OWNERSHIP

The Lundbeck Foundation is Lundbeck’s largest shareholder. It is a separate entity and holds approximately 80% of the A-shares and approximately 66% of the B-shares. The total share capital held by the Foundation is approximately 69% and the total voting rights held by the Foundation in Lundbeck is approximately 76%. The Foundation’s focus is on strengthening brain health and neuroscience through a series of research grants and collaborative research models. They award The Brain Prize yearly: it is the world’s largest brain research prize (approx. 1.3 million EUR) to one or more brain researchers who have had a ground-breaking impact on brain research.

SUSTAINABILITY-LINKED FINANCING

In 2022, Lundbeck signed a credit agreement concerning an existing 1.5 billion EUR revolving credit facility (RCF) to incorporate sustainability-linked targets 1 The interest rate on the RCF is linked to Lundbeck meeting three sustainability KPIs, which will be externally assessed on an annual basis by an independent third party. The KPIs in the facility relate to greenhouse gas emissions, renewable electricity, and access to brain health in low- and middle-income countries. Lundbeck will direct realized interest savings towards new sustainability-related initiatives focused on increasing access to brain health between 2022 and 2025.

1) BNP Paribas acted as sole sustainability coordinator. The structuring of the loan aligns with the guidelines set out by the Sustainability Linked Loan Principles, published by the Loan Market Association.

ENVIRONMENTAL POLICIES AND PERFORMANCE

Lundbeck is committed to protecting the environment and believes that a healthy environment is a precondition for good health and wellbeing. Our environmental work is governed by the sustainability strategy, our Code of Conduct; our Health, Safety, and Environment Policy; and our Health, Safety, and Environment Strategy. In 2022, the HSE policy was updated to explicitly include our commitment to prevent work-related diseases and accidents and our commitment to consult and ensure participation of employees in the HSE work to reflect stakeholder expectations, new legislation, and to better reflect our most material HSE aspects. Regular updates reflect our commitment to always promote a high level of chemical safety by substituting hazardous chemicals and apply contained processes as well as circular economy principles.

Lundbeck has several positions in relation to the environment. Read about our Position on Environmental Footprint, Position on Climate Change, Position on Water, and Position on Biodiversity on Lundbeck.com.

ENVIRONMENTAL MANAGEMENT AND POLLUTION PREVENTION

We have had a long-standing history of strong environmental management since the 1980s. We set our first CO2 target in 2006 and made our first CDP disclosure in 2007. Lundbeck’s corporate headquarters and our larger research, development, and manufacturing facilities are today certified to the ISO 14001 and 45001 standards.

BIODIVERSITY

Lundbeck does not operate in areas of high biodiversity value, nor do we source scarce natural resources for our production. However, Lundbeck takes biodiversity seriously and we always strive to reduce our environmental impact at our sites and in our value chain in line with Lundbeck’s Position on Biodiversity

PHARMACEUTICAL RESIDUES

We acknowledge stakeholder concerns about pharmaceutical residues in the environment. We test the environmental effects of new medicinal products and design processes with the least possible environmental impact.

We pursue approaches that balance healthcare needs and environmental considerations in line with the EFPIA’s Eco-Pharmaco-Stewardship Initiative to minimize pharmaceuticals in the environment.

Sustainability accounting policies - definitions

Environmental incidents

Environmental incidents with impact on the environment

An environmental incident is an unintended release to the environment.

Incidents with an impact on the environment and due for external reporting, are evaluated based on an internal risk assessment/scoring methodology of quantity, dispersion, and effect.

Environmental near miss

An environmental near miss is a contained spill which did not release to the environment. The near miss could potentially have escalated to an environmental incident.

CIRCULARITY, RESOURCE FLOWS, AND RECYCLING

Developing most of our own manufacturing processes gives us the opportunity to minimize material use, substitute unwanted substances, and increase recycling. We expect our suppliers to deliver materials and handle waste sustainably. See the Climate change & circularity chapter of this report.

Sustainability accounting policies - definitions

Revenue

Finished goods production

Chemical production

Raw materials

See Annual Report 2022 – Accounting Policy.

Production units (e.g. one tablet or one ampoule) based on SAP data.

Chemical production of Active Pharmaceutical Ingredients (API) and intermediate products.

Raw materials consist of the consumption of: Organic compounds (chemical compounds used in R&D and production) and Active Pharmaceutical Ingredients (API) (used for pharmaceutical production). Cleaning agents was part of the totals in 2020 and 2021 data. These were excluded in the scope in 2022 and going forward.

Waste

Waste is measured as the sum of all the waste disposed from Lundbeck’s four production sites. Waste is divided into “Chemical waste” and “General waste” and subdivided into Recycling, Incineration, Biological treatment, and Landfill. Incinerated waste water from chemical production processes is treated as waste and therefore reported as waste and not waste water

Recycling rate - Organic compounds

Organic compounds which are recovered and reused or recycled. Estimated relative to tonnes of total organic compounds used at both our chemical sites (Lumsås (DK) and Padova (I)). Organic compounds are reused on site in Lumsås (DK) and recycled externally at a third party in Padova (I).

Recycling rate - General waste Share of the total general waste reused or recycled based on the information from the receiver.

Water consumption

1) Data from 2021 has been updated due to change in classification of waste

2) 2022 data partly based on estimates

Waste water

Water consumption consists of: groundwater (unfiltered water) and water from waterworks (potable water). Data cover Lundbeck’s four production sites. Includes: water withdrawal for process use (boilers etc.), water withdrawal converted to steam or hot water, and water withdrawal for use in production, labs, offices and other buildings. Measured based on meter readings or invoices from suppliers.

Waste water discharge includes potable water and discharged groundwater/unfiltered water. Waste water includes all planned and unplanned discharges of water from Lundbeck’s four production sites. Recorded based on meter readings or water consumption.

CLIMATE AND ENERGY GOVERNANCE AND MANAGEMENT

Lundbeck’s commitment to climate actions is governed by a Steering Committee chaired by the Executive Vice President, Product Development & Supply. Across the responsible functions in Lundbeck, we have appointed project managers to lead the change and, as of 2022 and going forward, climate targets will be integrated into the performance review of a growing number of employees and managers. See the Climate change & circularity chapter of this report for descriptions of the actions taken in 2022 and progress on targets.

Sustainability accounting policies - definitions

Greenhouse Gas Emission Amount of calculated greenhouse gas (GHG) emitted to air, reported in CO2e.

Scope 1 GHGs

Direct scope 1 emissions include greenhouse gas emissions (GHG) that occur related to and including consumption of gas, oil, and refrigerants used in production (e.g. emissions associated with fuel combustion in boilers, furnaces, vehicles).

All consumed energy is monitored by building-specific meter readings or invoices. The quantity of consumed energy sources is multiplied by relevant emission factors provided by the UK Department for Environment, Food & Rural Affairs (DEFRA).

Emissions data from Lundbeck’s owned or controlled vehicle fleet are provided directly by the associated leasing company or calculated based on consumed fuel multiplied with relevant emission factors. Primary data from an estimated 57% of the company cars are retrieved and used to extrapolate emissions from Lundbeck’s full fleet activity.

Scope 2 GHGs (location based) Scope 2 emissions includes all indirect emissions related to the generation of acquired and consumed electricity and district heating. All consumed energy is monitored by building-specific meter readings and invoices if meter readings are not available.

The emissions are reported as location-based and are derived from consumed energy multiplied with relevant location-based emission factors provided by DEFRA.

Scope 2 GHGs (market based) Includes all indirect emissions related to the generation of acquired and consumed electricity and district heating.

All consumed energy is monitored by building-specific meter readings or invoices.

1) Scope 1 also includes company cars, which are covered by scope c rather than scope b

2) 2020 data changed due to corrections of biooil use

3) 2021 and 2020 data updated due to change in emission factor

4) 2021 data updated due to correction in district heating

5) 2020 and 2021 data updated due to change to Science Based Targets

6) New KPI added to reporting in 2022 - changed from 'Renewable energy share'

The emissions are reported primarily as market-based emissions, where consumed scope 2 energy is multiplied with market-specific emission factors provided directly from the energy supplier. Where market-specific emissions are not available, the best available location-based emission factors provided by DEFRA are used for the reporting in line with the GHG protocol hierarchy.

Scope 1 & 2 GHGs (market based) Combines the calculated scope 1 and scope 2 emissions using the reported market-based scope 2 emissions.

Sustainability accounting policies - definitions (continued)

Scope 3 GHGs

Scope 3 includes and accounts for other indirect emissions in Lundbeck’s value-chain, which are not accounted for elsewhere.

The reported scope 3 emissions are limited to include three GHGprotocol categories: ‘Purchased goods and services’, ‘Upstream transportation and distribution’, and ‘Business travel’. The reported scope 3 emissions cover our scope SBTi target boundary.

Sustainability accounting policies - definitions (continued)

VOCs emitted to air Volatile Organic Compounds (VOCs) emitted to air. An insignificant share of the VOCs from Lundbeck’s production has global warming potential (according to IPCC) and the VOCs are therefore not reported as part of our scope 1 GHG emissions.

Energy consumption

Consumed energy is monitored by building-specific meter readings or invoices if meter readings are not available

Scope 3 GHGs: Purchased goods and services

Emissions related to purchased products are estimated based on acquired quantities multiplied with appropriate emissions factors supplied by the Ecoinvent database.

Emissions related to purchased services are based on financial spend in USD multiplied with relevant spend-based emission factors supplied by the USEEIO database. Approximately 12% of the emissions in this category are excluded, as they are not included in our SBTi target boundary. The excluded emissions include tax and authority service.

App 12.3% of data in this category is based on suppliers’ emission data reported directly to Lundbeck or based on the suppliers’ reported emissions in their CDP disclosure or Sustainability Reports.

Renewable electricity share

Share of renewable electricity purchased through either selected supplier or shares of renewable electricity in country-specific grids. The share of renewable electricity is reported as the mean of consumed renewable electricity

Scope 3 GHGs: Up-stream transportation and distribution

Includes emissions from all purchased (non-owned) transport and distribution services. This includes inbound logistics (from Tier 1 suppliers), transport between Lundbeck sites in Valby and Lumsås (DK), and outbound logistics. A selection of Lundbeck’s key logistic suppliers provides specific emissions data for their activities related to Lundbeck. Where this is not available, emissions are calculated based on financial spend in USD multiplied with relevant spend-based emission factors supplied by the EEIO database. This is primarily for locally procured logistics services.

All emissions related to the category are converted and calculated as well-to-wheel greenhouse gas emissions.

Scope 3 GHGs: Business travel

Includes emissions from the transportation of employees across the whole group for business-related activities owned or operated by third parties. This includes emissions that are caused due to employees traveling by air, road, rail, and sea as well as emissions associated with hotel stays. The emissions from business travel-related activities are calculated based on transported distance and number of stays at hotels, multiplied with relevant emissions factors provided by DEFRA.

Flight-related emissions are provided by associated travel agencies, covering 80% of total activity. The last 20% has been extrapolated.

REPORTING ACCORDING TO CLIMATE-RELATED FINANCIAL DISCLOSURES (TCFD)

Lundbeck supports the TCFD recommendations and believes they provide a useful framework to increase transparency on climate-related risks and opportunities within financial markets.

The CEO has the overall responsibility of the sustainability strategy and presents major decisions to the Board when relevant. Risks including related mitigating actions and opportunities are assessed regularly by the Executive Management and reviewed together with the Board of Directors.

Our climate-related risks and opportunities all have low impact, except physical risks of exposure to extreme weather events that can affect our sites, partners, and suppliers, and conversely the opportunity to maintain resilient production.

Risk and opportunities are impacting our business by leading us to become highly energy efficient, increase our use of renewable energy, and engage with suppliers to mitigate future physical and transitional changes.

We prepare scenario analysis using climate modeling scenarios predicting temperature increases. As part of our CSRD Readiness work in 2023, our process for this analysis will be evaluated with a view to strengthen cross-functional involvement.

As part of our support for the TCFD recommendations, Lundbeck comprehensively reports on governance, strategy, business opportunities, and risks related to climate change through the Carbon Disclosure Project (CDP). You can find our latest full CDP disclosure on Lundbeck.com.

REPORTING ACCORDING TO THE EU TAXONOMY (NOT PART OF PWC’S LIMITED ASSURANCE)

Lundbeck is required to disclose information related to the EU Taxonomy, more specifically The Climate Delegated Act entered into application on 1 January 2022 and the Complementary Delegated Act, as published in the Official Journal on 15 July 2022. The Complementary Delegated Act will enter into application on 1 January 2023.

Lundbeck has no taxonomy eligible or aligned turnover related to climate change and climate mitigation to report in 2022, as it is not part of our business model. We have reviewed our CAPEX and OPEX activities for 2022 aiming to identify eligible activities and determine the eligible amount for those items according to the Taxonomy requirements. We identified that OPEX is not centrally accounted, but rather recorded locally across the business. Further, CAPEX is tagged by general activity, and to assess compliance with eligible activities as required by the EU Taxonomy requirements, we assessed the list of projects that Lundbeck invested in 2022 to map eligible activities in accordance with the normative.

Based on this approach, we found three eligible activities: Construction of new buildings; Renovation of existing buildings; and Transport by motorbikes, passenger cars, and light commercial vehicles. We reviewed the activities currently published and found that the activity “Transport by motorbikes, passenger cars, and light commercial vehicles” is important to us from a sustainability perspective, as company cars are part of our GHG scope 1 emission target

For all three activities, our review found that none of Lundbeck’s CAPEX or OPEX live up to the substantial contribution criteria and are therefore not taxonomy aligned. When looking at the substantial contribution criteria for the activities, it was clear that the activities performed were noncompliant, which therefore meant it was unnecessary to move on to examine the Do No Significant Harm and Minimum Safeguard criteria, as we would not be claiming alignment. For our reporting period, we also do not have a focus on improving our alignment in our approved CAPEX plan, as there is a small percentage which is eligible according to the currently published activities. Similarly, as we are a pharmaceutical company, the majority of our OPEX is centered on R&D, which is currently not an eligible activity and therefore contributes to our low eligibility.

In conclusion, Lundbeck has no taxonomy-aligned turnover, CAPEX, or OPEX related to climate change and climate mitigation to report in 2022.

Sustainability accounting policies - definitions

Turnover denominator The share of turnover generated from taxonomy-eligible economic activities is divided by net sales. In order to determine the turnover generated by the Group from taxonomy-eligible economic activities, the Company allocates the relevant products to those underlying activities. This KPI is calculated through our net sales reported in our Income Statement (denominator) and disclosed as part of the Group’s Financial Statements.

OPEX denominator Direct non-capitalized costs recorded in the Consolidated Income Statement under IFRS that relate to research and development, building renovation measures, short-term lease, maintenance and repair (excluding expenses reported as raw materials and consumables used), and any other direct expenditures relating to the day-to-day servicing of assets or Property, Plant, and Equipment (PPE).

CAPEX denominator Additions to tangible and intangible assets accounted for in the Consolidated Financial Statements under IFRS during the financial year, considered before depreciation, amortization, and any remeasurements, excluding Goodwill (included in Note 7, 8, and 9 in the Financial Statements).

ACCESS TO MEDICINE

For information on Lundbeck’s product donation program, our position papers, disease awareness material and patient support programs, and more, see the Unmet patient needs section of this report

Pricing

Lundbeck acknowledges the challenges faced by healthcare systems under pressure from rising demands, and we recognize concerns expressed on the affordability of innovative medicines. See more in our global pricing position.

Product donation program

In 2020, we commenced our collaboration with International Health Partners (IHP) to initiate their first mental health program in the Middle East & Africa (MEA) region. In 2021, we signed a Letter of Intent to expand our partnership.

Diversity in clinical trials commitment

Building an inclusive clinical trials infrastructure, one that reflects the intended treatment population, is an important step toward combating health inequities and racial disparities in brain health.

In April, we launched the new, global Lundbeck Clinical Trial Diversity Principles, which entail the execution of a new global strategy in collaboration with patient advocacy groups and the implementation of an integrated oversight approach with monitoring and setting targets for trial diversity.

To guide our efforts, the Lundbeck Diversity Steering Team will assess and drive efforts in this area and monitor our progress to keep us accountable for effecting long-term, positive change. Lundbeck is also a signatory to the PhRMA Principles on Conduct of Clinical Trials & Communication of Clinical Trial Results, the first-ever industry-wide principles on clinical trial diversity in the U.S.

Patent principles

In 2021, Lundbeck and 25 other pharmaceutical companies announced an approach to intellectual property (IP) for advancing cures and therapies with patient and societal benefit at its core. It is called the IP Principles for Advancing Cures and Therapies (IP PACT). We believe that IP is a key facilitator of medical progress, and we strive for patient and societal benefits as guiding principles in our IP practices. One of the principles is that we approach IP in the world’s poorest countries in ways that consider their unique socio-economic challenges. It is important to Lundbeck that patients and society understand the way we use IP and why it is essential to what we do. Therefore, together with other companies, we communicated these key IP principles that guide our use of IP to advance the goals of improving and extending patients’ lives.

Clinical trial result disclosure

Clinical trials are outsourced and continuously monitored on regulatory Good Practice requirements, as well as all relevant requirements from Lundbeck’s Code of Conduct.

Sustainability accounting policies - definitions

Donated treatment in Low-Middle Income Countries Number of patients estimated by dividing the number of doses shipped with medically recommended average treatment. The number is based on a mathematical calculation based on the donated amount of medicine. The number is not based on an evaluation of actual treatment at clinics.

Lundbeck registers clinical trial protocols and discloses the results of clinical trials, regardless of outcome, in a publicly accessible clinical trial registry (ClinicalTrials.gov). In addition, clinical trial protocols and information on the results submitted by Lundbeck to the EudraCT database is made publicly available by the European Medicines Agency (EMA) via its clinical trial registry. Clinical trial reports will be accessible on the EudraCT site in accordance with EMA POLICY/0070. Noninterventional studies may also be disclosed if, for example, they are considered to provide important safety data.

Lundbeck will seek to ensure that disclosure of clinical trial information follows the IFPMA, EFPIA, JPMA, and PhRMA joint position paper “Disclosure of Clinical Trial Information via Clinical Trial Registries and Databases”, the Declaration of Helsinki and other relevant clinical trial disclosure requirements.

PRODUCT AND PATIENT SAFETY

The Lundbeck Safety Board is the primary safety governance body at Lundbeck with a mandate to pause development activities globally for safety reasons, as well as to escalate safety issues directly to the CEO.

In 2019, a Chief Medical Officer role was introduced and was fully implemented in procedures in 2020. The role is linked to the Chair role of the Lundbeck Safety Board. In 2021, all employees globally were required to complete online awareness training on patient safety / pharmacovigilance.

Combating falsified or counterfeit products

We take stringent measures to secure our supply chain and ensure that genuine Lundbeck medicines reach patients every time. We protect the integrity of our products by labeling packages with batch numbers, serial numbers, and 2D matrix technologies. Tools used by our dedicated team in Brand Protection to identify threats and develop mitigation actions include:

• Ongoing monitoring of specific country customs data in response to known threats

• Customs surveillance & training

• Intelligence sharing with industry peers and associations

• Market surveys: purchases from pharmacies to assess the local market

• Online monitoring of e.g. marketplaces, online pharmacies, social media

• Quality complaints from affiliates

• Test purchases

• Mitigation actions and enforcement are appropriate to the assessed nature, scale, and impact of risks and/or threats

Lundbeck has mandatory Good Manufacturing Practices (GMP) and Good Distribution Practices (GDP) requirements in place that cover compliance in the area of Storage and Distribution and include managing risks related to third-party transportation companies.

Lundbeck collaborates with customs authorities to surveil shipments claiming to contain Lundbeck products, providing training when necessary. We also engage with international organizations dedicated to fighting counterfeit medicine by attending quarterly meetings of the EFPIA Anticounterfeiting & Security Network, and regular workshops as well as annual conferences of the

International Anti-Counterfeiting Coalition (IACC) and the International Trademark Association (INTA).

Concerns and complaints related to product safety and counterfeit medicine are captured through dedicated channels (see Code of Conduct – Patient Safety). Customers and business partners are alerted to potential or known risks associated with counterfeit products by authorities who are notified according to Lundbeck’s country-specific processes. Additionally, wholesalers and distributors are advised by the local Lundbeck function responsible for quality and anticounterfeiting.

Internal awareness training on illicit trade and anti-counterfeiting is provided throughout the year to commercial teams in countries with identified risks by Lundbeck’s Senior Brand Protection Manager.

Product quality

Product quality is paramount at Lundbeck. All our sites are subject to both internal and external Good Process (GxP) audits as well as regulatory audits.

All Lundbeck production sites hold the necessary certifications to operate as a pharmaceutical manufacturer, and we cascade our standards in our value chain through audits and training relating to Good Manufacturing Practices and Good Distribution Practices.

OWN EMPLOYEES

Our employees are our most important and critical resource. At Lundbeck, we ensure respect for the individual and the continuous development of our employees. We consider staying safe and healthy at work a fundamental right for all.

Diversity and inclusion

Lundbeck is a diverse company determined to build an inclusive high-performance culture that allows all employees to enrich their professional skills and career at Lundbeck without discrimination, as described in our global Diversity and Inclusion Policy. See the People & communities chapter of this report for 2022 activities.

Lundbeck’s Management remuneration package consists of both fixed and variable components. All members of Management participate in Lundbeck’s Long-Term Incentive program (LTI) which is a part of the variable remuneration. Lundbeck’s LTI program is designed to retain Executives and to align with our shareholders’ long-term interests through a link to the performance of Lundbeck’s share price. The link provides Management with an incentive to drive innovation to Lundbeck’s growth on a long-term sustainable basis.

Sustainability accounting policies - definitions

Average employee remuneration Total H. Lundbeck A/S remuneration excl. registered Executive Management members divided by total number of FTEs in H. Lundbeck A/S. This number is taken from the Remuneration Report, please see:

CEO/Employee ratio - without tax indemnification

Total CEO remuneration without tax indemnification divided by H. Lundbeck A/S average employee remuneration excl. registered Executive Management members. This number is taken from the Remuneration Report, please see:

1) Data from 2021 and 2020 updated due to recalculation

2) KPI added to reporting in 2022

Remuneration

At Lundbeck, we strive to offer employees a competitive and market-related remuneration package consisting of fixed and variable compensation as well as monetary and non-monetary benefits. We believe that with an employee-focused, fair, and transparent remuneration package, we can attract and retain the most qualified talents in the market. Lundbeck’s compensation and benefit programs are reviewed each year and benchmarked against the market to ensure that Lundbeck’s remuneration is competitive and aligned to our company goals and priorities.

CEO/Employee ratio - with tax indemnification

Total CEO remuneration with tax indemnification divided by H. Lundbeck A/S average employee remuneration excl. registered Executive Management members. This number is taken from the Remuneration Report, please see:

Gender balance - all employees Includes all permanent employees hired and paid directly by H. Lundbeck A/S. Gender is assigned as female or male. Gender balance reported as female/male shares of total.

Gender balance - all people managers Includes all managers that have at least one direct report in their organizational structure. Gender is assigned as female or male. Gender balance reported as female/male shares of total.

Gender balance - senior managers Includes all Executive Vice Presidents, Senior Vice Presidents and Vice Presidents. Gender is assigned as female or male. Gender balance reported as female/male shares of total.

Number of women on the Board (shareholder elected)

Total number of women elected by the general meeting divided by the total number of members of the Board of Directors for H. Lundbeck A/S elected by the general meeting. Gender is assigned as male and female.

Employee satisfaction and development

All employees globally participate in an annual Employee Satisfaction Survey, where results of the survey are shared internally and action plans are put in place where necessary. All employees are also appraised annually and have an opportunity to discuss individual training needs and career aspirations with their immediate manager.

Flexibility, Mobility, and Wellbeing

In Lundbeck, we realize that individual productivity and wellbeing may be improved by having flexible work arrangements, which is why our Flexible Workplace, Flexible Workday, and Reduced Hours Policy applies to all our office employees. Although our primary place of work is in a face-toface setting, local management decides how to shape the best work environment in each area. Place of work as well as working hours can be altered to be mutually beneficial to the employee and the organization. Employees can also apply for reduced work time according to their personal needs while special leave and sabbaticals are decided on a case-by-case basis. In Lundbeck, we want to achieve the flexibility and agility required to respond to changing business demands. Our Global Mobility Policy acts as a framework for extended business travel which allows eligible employees to participate in international assignments lasting from 2 to 36 months.

Supporting the mental and physical wellbeing of our employees is a high priority. Wellbeing initiatives vary from location to location to account for the diverse needs in our global organization. Stress prevention programs have been rolled out in major sites, giving employees the tools and support they need to maintain a healthy balance in their work and personal life. Local management teams prioritize work-life balance considering individual needs in their teams and monitoring wellbeing through continuous dialogue and annual surveys. For more information about working at Lundbeck, visit our career pages.

Occupational Health and Safety

It is key for Lundbeck that we provide a safe and healthy workplace and inclusive culture. This is addressed and enforced through regular training, awareness campaigns, and internal audits. Lundbeck’s Health and Safety performance is governed by our Code of Conduct, our Position on Health and Safety, Health, Safety and Environment Policy, and our Health, Safety and Environment Strategy. Lundbeck’s corporate headquarters and our larger research, development, and manufacturing facilities are certified to the ISO 45001 standard certification

Sustainability accounting policies - definitions

Work-related accident with absence

Work-related near miss

Work-related accident without absence

An undesired event or exposure that occurs suddenly and gives rise to personal physical or psychological injury and results in days away from work for one or more days in addition to the day of the accident.

A sudden, unexpected incident or situation where no personal injury occurred, but had the potential to do so.

An event or exposure that occurs suddenly and gives rise to personal physical or psychological injury, but does not result in incapacity to work in addition to the day of the accident.

Work-related disease

A work-related disease that arises after long-term harmful exposure from the work or working conditions. Must be recognized as a disease by the competent authority.

High-consequence work-related accident with absence

Work-related accidents with absence that are assessed as “Large” (work-related injury with permanent injury) or “Catastrophic” (death or disability) in internal risk assessment and results in an injury from which the employee is not expected to recover fully within six months.

Frequency of lost time accidents

The frequency is calculated as the number of accidents with absence and fatalities per one million working hours.

Total number of working hours is calculated using an estimate of 225 working days a year multiplied by 7.4 hours per day multiplied by the number of employees.

Fatalities

Fatalities are the number of employees who lost their lives as a result of a work-related accident. These accidents are included in the calculation of the Frequency of lost time accidents.

SOCIAL RESPONSIBILITY IN OUR VALUE CHAIN

All raw material suppliers for commercial production and Contract Manufacturing Organizations are subject to a human rights and environmental due diligence screening prior to engagement with Lundbeck, as well as ongoing monitoring. All such facilities located outside the EU/ESS and North America are audited by qualified Lundbeck staff for health & safety, employment, and environmental conditions.

Third parties and suppliers are contractually bound to adhere to local and internationally recognized anti-corruption, labor rights, human rights, and environmental standards as dictated by principles of the UN Global Compact. Critical or material collaboration partners and suppliers are contractually required to adopt our Third Party Obligations, which bind them to adhere to relevant sections of Lundbeck’s Code of Conduct.

To assess and verify compliance, we apply systematic due diligence with regards to respecting human and labor rights, environmental protection, and preventing corruption.

The specific risk areas assessed are:

• Conflict of interest

• Financial crime (including corruption, bribery, tax evasion, and violations of trade sanctions)

• Promotional misconduct

• Human and labor rights violations

• Significant environmental impact

Often, we combine a due diligence process with training, performance monitoring, and compliance audits, where we emphasize continuous open dialogue with our suppliers and third parties.

HUMAN RIGHTS

Our human rights statement expresses our commitment to respect human rights, while our commitment to ending all forms of human slavery is reflected in our UK Modern Slavery Act Statement. Additionally, we are advocates for the respect of human rights in relation to mental health. It is a tragic fact that people living with mental health conditions can be amongst the most vulnerable in society, enduring incarceration, chaining, coercion and over-medicalization, stigma, and exclusion.

Data privacy

H. Lundbeck A/S (“Lundbeck”) is firmly committed to protecting the privacy of the personal data we collect. In processing personal data, Lundbeck (as data controller) will comply with applicable legislation, including the General Data Protection Regulation (“GDPR”) and the Danish Data Protection Act.

Read our Data Privacy Policy to find out more about how we at Lundbeck are committed to safeguarding the rights of patients, research and business partners, and our employees, in accordance with applicable personal data legislation.

Data Ethics Policy

In 2021, Lundbeck developed and approved a new, global Data Ethics Policy on ethical and responsible decision making on the use of data. Our Data Ethics Policy states the principles we commit to apply beyond staying compliant with current data protection regulations. It is especially relevant in the development or application of fast-moving, innovative digital technologies. The Data Ethics Policy shall help us make ethical and responsible decisions on the use of data with maximal benefit and minimal harm for individuals and society.

PRESENCE IN RUSSIA

Lundbeck condemns the war in Ukraine and Russia’s invasion of a free and democratic nation. We are complying with all sanctions and are performing extra checks to ensure that we are not trading with some of the sanctioned companies or organizations in Russia.

Essential food supplies and medicine are often exempt from sanctions on humanitarian grounds. Lundbeck has therefore decided to continue supplying medicine to people with brain diseases in Russia – something that is allowed under the current sanctions. We closely follow whatever sanctions are decided, and we make corrections to comply on an ongoing basis, should the sanctions be extended.

Governance

BUSINESS ETHICS

Our Code of Conduct is the backbone of our ethics and compliance culture and is available in 11 different languages. It conveys our commitments and expectations to our employees for areas critical to the pharmaceutical industry. All Lundbeck employees and third parties working on Lundbeck’s behalf are obliged to observe the Code of Conduct and any stricter local regulations. Each year, all employees are trained in different areas of the Code of Conduct, and we set targets for the completion rates.

Compliance governance and management

Lundbeck’s Board of Directors’ Audit Committee provides oversight of Lundbeck’s Compliance Program, including the investigation procedures and outcomes. Our Chief Compliance Officer provides briefings on current developments at the Audit Committee meetings, which aims to ensure the Code of Conduct Compliance Program and organization is kept effective, sufficiently positioned, and resourced.

Lundbeck’s Compliance Committee, led by the Chief Financial Officer representing Executive Management and Senior Management, sets strategic directions for the development of Lundbeck’s global Compliance Program. Regional Compliance Officers, who report (dotted line) to the Chief Compliance Officer, are responsible for implementing the Compliance Program in Lundbeck’s affiliates within the region.

The global and local procedures around the Code of Conduct contain more operational requirements and good practices. Lundbeck maintains a Good Practice (GxP) quality management system for patient and product safety to control risks, continually improve processes, and meet regulatory expectations.

Our Business Ethics compliance audits and monitoring efforts aim to validate understanding of the requirements and capture suggestions for improvements of the processes and controls. Lundbeck’s auditors provide feedback on corrective and preventive actions to ensure local management ownership and follow-up. An Audit Management Group coordinates across the corporate functions that are responsible for performing different types of audits.

We build our governance around the principles in our Code of Conduct, which are cascaded as needed into manuals, guidelines, policies, and standard operating procedures. Relevant documents that are publicly available are referenced in these Sustainability Statements under the respective issue.

Transparent interactions

We are committed to transparency and we are a member of the European Federation of Pharmaceutical Industries Associations (EFPIA). We disclose the transfers of value we make to individual healthcare professionals and healthcare and patient organizations. Read more about interactions with healthcare professionals and patients, a methodological note on disclosures, and Lundbeck’s EFPIA Disclosure Code Self-Certification Scheme on lundbeck.com.

Promotional activities

Promotion of medicinal products is strictly regulated and monitored by local authorities and industry associations. We are committed to complying with applicable laws, regulations, and industry codes. This means maintaining processes and providing extensive training to ensure that promotional activities are appropriately assessed.

Lundbeck’s independent Promotional and Advertising Review Committee reviews and approves promotional activities, including materials, produced at our headquarters. Our affiliates are responsible for ensuring that promotional activities, including materials, are reviewed and approved in accordance with applicable rules, before the materials are used within the specific local market.

Audits and monitoring

Lundbeck continuously performs a significant number of audit, monitoring, and control activities within compliance. These cover both our internal processes as well as external partners such as suppliers. Due to Covid travel restrictions early in the year, it was not always feasible to conduct all planned physical audits; therefore, some activities were postponed or replaced with remote reviews.

Supplier and third-party due diligence

Our supplier and third-party due diligence process specifically looks at identifying and mitigating risks in relation to: conflict of interest; financial crime including bribery, tax evasion, and violations of trade sanctions; promotional misconduct; human and labor rights violations; and significant environmental impacts.

The due diligence process takes a risk-based approach and targets goods, services, and collaborations where the risks are most prevalent: in chemical manufacturing, customs clearance, product price negotiations, obtaining product marketing authorizations, organizing promotional or educational events, and when selling Lundbeck products.

Read more about our due diligence process on Lundbeck.com; see the areas covered by our due diligence process and the contractual obligations that third parties are required to adhere to.

Sustainability accounting policies – definitions

Patient & product safety audits Includes the following audit areas: Good Clinical Practice, Good Laboratory Practice, Good Manufacturing Practice, Good Distribution Practice, Medical Regulatory Clinical Quality Assurance (MRC QA), Pharmacovigilance Audits, Chemistry, Manufacturing, and Controls Quality Assurance (CMC QA), Corporate Product Quality (CPQ), and Animal Welfare. All audits are performed and reported by internal functions in Lundbeck.

Health, Safety & Environment audits

Process for verifying that our internal operations, as well as the operations of our suppliers and third parties, meet our expectations and requirements with regards to health & safety performance, human and labor rights performance (applicable for suppliers and third parties), and environmental performance. All audits are performed and reported by internal functions in Lundbeck.

Business ethics and internal control audits

Third parties and supplier audits

Compliance reviews, financial audits and reviews, and audits and monitoring of field-based activities and employees All audits are performed and reported by internal functions in Lundbeck.

Compliance reviews and audits of third parties and suppliers (based on contractual requirements and requirements stipulated in Lundbeck’s third-party obligations), and information security reviews of external personal data processors. All audits are performed and reported by internal functions in Lundbeck.

Compliance Hotline reports

All concerns reported through the Compliance Hotline, regardless of whether investigations were able to be substantiated. Data from prior to 2022 is based on the aggregation of reports to the same specific cases.

Completion rate of annual Code of Conduct e-learning

Due Diligence screenings of suppliers and third parties

Includes all permanent and temporary employees, excluding employees on leave. Completed by 27 January 2023.

An examination of publicly available sources to identify potential risks related to potential or existing third parties. The number contains all screenings completed, found to be out of scope, or withdrawn by the reporter

1) Compliance Hotline reports were aggregated by case prior to 2022. New accounting policy for 2022 - each report now presented unaggregated.

2) KPI added to reporting in 2022

WHISTLEBLOWER SYSTEM AND OMBUDSMAN

Lundbeck has in place a Compliance Hotline (whistleblower system) as a secure and confidential reporting channel managed by an independent provider. Due to data protection regulations and other legal restrictions, only concerns that involve legal or other serious risks to Lundbeck may be reported via the Compliance Hotline. All reported concerns are investigated and handled in line with Lundbeck’s global procedure. Our investigations are guided by principles that manifest Lundbeck’s beliefs, including:

• Protection of good-faith reporters against retaliation

• Confidentiality

• Cooperation

• Proportionality

• Communication

• Independence

The Compliance Hotline investigation procedure was last updated in 2021 to reflect the EU Directive 2019/1937 on protecting whistleblowers that entered into force in 2021.

We continuously work to increase visibility of the Compliance Hotline via internal awareness campaigns and externally on localized Lundbeck websites. Read more on what allegations can be reported

An Ombudsman is available to employees for work-related grievances not covered by the Compliance Hotline. There are also channels available for reporting Adverse Drug Reactions and other patient and product safety-related issues and complaints, including information about counterfeit medicine.

ANIMAL WELFARE

As part of the development of new treatments, we are obliged to conduct tests on animals to ensure patients receive safe and effective medicines. We prioritize animal welfare and commit to the ethical treatment of animals used in our research. We provide appropriate care for our animals and continuously work to improve our animal research policy and procedures as well as our animal facilities.

Lundbeck’s Animal Care and Use Committee oversees all testing on animals and reviews animal models on a continuous basis using the principles of replacement, refinement, and reduction of animals (3Rs) to which we are fully committed.

Additionally, a dedicated team of specialists is responsible for auditing and approving locations where testing on animals is performed on Lundbeck’s behalf. In 2021, we conducted 31 external animal welfare audits. All employees working with animals have appropriate and documented education (FELASA standards) and internal training that depends on the type of work being performed. Lundbeck works with external partners on implementing the 3Rs for continuous improvements, actively supports the National 3R Center in Denmark, and meets with animal welfare organizations regularly to discuss best practices and progress.

Our Animal Care and Use Committee consists of: a Chair (SVP level), a researcher with hands-on experience, a representative from Animal facilities, laboratory animal veterinarians, a lay person, and an external expert in laboratory animal science.

BOARD LEVEL COMMITTEES

The Board of Directors has set up three advisory committees: The Audit Committee, the Remuneration & Nomination Committee, and the Scientific Committee. More can be read in our Statutory Corporate Governance Report.

PUBLIC AND POLITICAL INFLUENCE

We comply with the Danish lobby code for pharmaceutical associations. Global affiliates follow local legislation. Our EU lobbying activities are registered in the official transparency register, and there is one meeting registered for 2022.

In the U.S., we are required to report quarterly to Congress (searchable through a public database) the costs associated with lobbying on behalf of Lundbeck (which includes our consultants and trade association dues attributable to lobbying), and also disclose the issues we lobby on.

CORPORATE GOVERNANCE

Our governance framework is based upon the recommendations issued by the Danish Committee on Corporate Governance and consists of rules and principles that support sustainable financial performance and long-term value creation for our shareholders and for our societies. More information is also available in our Statutory Corporate Governance Report.

Sustainability Accounting Policies

REPORTING PERIOD

All reported data are covering a full year period (1 January to 31 December 2022). The accounting policies have been applied consistently for all the years presented, if not otherwise stated. All KPIs reported in the Sustainability Report are gathered and aligned with the timeline for annual reporting of the financial data.

SCOPE

There are four different scopes used for KPIs:

a) Production sites: Valby (DK), Lumsås (DK), Valbonne (F), and Padova (I) Scope a is used for indicators related to accidents with absence and accident frequency, environmental management, environmental incidents, VOC emissions, production of waste, and resource flows, as these are almost entirely related to our production sites.

b) Production sites: Valby (DK), Lumsås (DK), Valbonne (F), and Padova (I), and four additional sites: Krakow (PL), La Jolla, Deerfield, and Seattle (USA)

Scope b is applied to indicators for the consumption of energy and scope 1 and 2 GHG emissions. All emissions within operational control boundaries are included within this scope, as our rented offices at our affiliate locations are accounted as leased assets. Note that scope 1 GHG emissions include emissions from our fleet of company cars worldwide, for which scope c (all sites and all employees) applies.

c) All sites and all employees

Scope c is applied for business ethics, people and remuneration, and access to health indicators, as these policies and activities cover all Lundbeck employees.

d) Entire business worldwide and value chain

Scope d contains the three indicators for Scope 3 GHG emissions encompassing 67% of our estimated total GHG footprint from our value chain, which is in line with our SBTi target for Scope 3.

In the event of acquisitions or divestments, Lundbeck will include or exclude any acquired or divested business from the following full financial year.

DATA QUALITY AND CONSOLIDATION

We are committed to collecting the most accurate data possible and in order to do this, we use a number of data collection tools and reporting software. Nevertheless, it is not always possible to gain a fully aligned register of data, and estimations are sometimes necessary. The KPIs which necessitate the use of estimations are clearly marked within the KPI definitions, which also contain detailed information on how the KPI is measured and the data needed for the calculations.

DEFINITION OF INDICATORS

Accounting policies are stated along with the KPIs on pages 30-33, 38, 40-41, and 44 and are part of the collective Sustainability Accounting Policies.

REVISED/NEW INDICATORS IN 2022

• Due Diligence screenings of suppliers and third parties

This is a KPI that we have used for number of years in Lundbeck as a performance measurement

We have now included it in our external reporting to increase transparency in our third party and supplier due diligence process.

• Renewable energy share changed to Renewable electricity share

In the coming years we will focus strategically on increasing our renewable electricity share globally as a part of our Zero Carbon Transition Plan.

• Gender balance – Senior Managers

Added as performance measure for a new target set within Lundbeck’s Sustainability Strategy

Management Statement regarding the 2022 Sustainability Report

The Board of Directors and the registered Executive Management have today considered and approved the 2022 Sustainability Report of H. Lundbeck A/S for the reporting period 1 January to 31 December 2022.

The Sustainability Data in the 2022 Sustainability Report has been prepared in accordance with the stated sustainability

Copenhagen, 8 February 2023

REGISTERED EXECUTIVE MANAGEMENT

accounting policies and the Greenhouse Gas Protocol guidelines regarding our carbon footprint.

In our opinion, the 2022 Sustainability Report gives a fair presentation of the Group’s sustainability activities and the results of our sustainability efforts in the reporting period, as well as a balanced presentation of our

environmental, social, and governance performance in accordance with the stated sustainability accounting policies.

President and CEO Executive Vice President, Product, Development & Supply

Joerg Hornstein Executive Vice President, CFO Executive Vice President, Research & Development Executive Vice President, Commercial Operations

Independent limited assurance report on the Sustainability Data

TO THE STAKEHOLDERS OF H. LUNDBECK A/S

H. Lundbeck A/S (‘Lundbeck’) engaged us to provide limited assurance on the Sustainability Data included in the 2022 Lundbeck Sustainability Report on pages 30-33 and 38-46 for the period 1 January - 31 December 2022 (the "Sustainability Data").

Our conclusion

Based on the procedures we performed and the evidence we obtained, nothing came to our attention that causes us not to believe that the Sustainability Data in the 2022 Lundbeck Sustainability Report are prepared, in all material respects, in accordance with the Sustainability Accounting Policies developed by Lundbeck as stated on pages 30-33 and 38-46 (the “Sustainability Accounting Policies”).

This conclusion is to be read in the context of what we state in the remainder of our report.

What we are assuring

The scope of our work was limited to assurance over the Sustainability Data included in the following sections of the 2022 Lundbeck Sustainability Report:

• Environmental management on page 30.

• Circularity - resource flows on page 31.

• Climate and Energy on page 32.

• Access to Health on page 38.

• People on page 40.

• Health & Safety on page 41.

• Code of Conduct compliance on page 44.

We express limited assurance in our conclusion.

Professional standards applied and level of assurance

We performed a limited assurance engagement in accordance with International Standard on Assurance Engagements 3000 (Revised)

‘Assurance Engagements other than Audits and Reviews of Historical Financial Information’ and, in respect of the greenhouse gas emissions, in accordance with International Standard on Assurance Engagements 3410 ‘Assurance engagements on greenhouse gas statements’. The quantification of greenhouse gas emissions is subject to inherent uncertainty because of incomplete scientific knowledge used to determine the emissions factors and the values needed to combine emissions of different gasses.

A limited assurance engagement is substantially less in scope than a reasonable assurance engagement in relation to both the risk assessment procedures, including an understanding of internal control, and the

procedures performed in response to the assessed risks; consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been performed.

Our independence and quality control

We have complied with the independence requirements and other ethical requirements in the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (IESBA Code), which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behavior, and ethical requirements applicable in Denmark.

PricewaterhouseCoopers applies International Standard on Quality Management 1, ISQM 1, which requires the firm to design, implement and operate a system of quality management including policies or procedures regarding compliance with ethical requirements, professional standards, and applicable legal and regulatory requirements.

Our work was carried out by an independent multidisciplinary team with experience in sustainability reporting and assurance.

Understanding reporting and measurement methodologies

The Sustainability Data need to be read and understood together with the Sustainability Accounting Policies. The Sustainability Accounting Policies used for the preparation of the Sustainability Data are accounting policies developed by the company, which Management is solely responsible for selecting and applying.

The absence of a significant body of established practice on which to draw to evaluate and measure Sustainability Data allows for different, but acceptable, measurement techniques and can affect comparability between entities and over time.

Work performed

We are required to plan and perform our work in order to consider the risk of material misstatement of the Sustainability Data. In doing so and based on our professional judgement, we:

● Evaluated the appropriateness of the Sustainability Accounting Policies used, their consistent application and related disclosures in the 2022 Lundbeck Sustainability report.

● Made inquiries and conducted interviews with Lundbeck’s management with responsibility for management and reporting of the Sustainability Data to assess reporting and consolidation process, use of company-wide systems and controls performed.

● Performed limited substantive testing on a sample basis to underlying documentation and evaluated the appropriateness of quantification methods and compliance with the Sustainability Accounting Policies for preparing Sustainability Data at corporate head office and in relation to selected Lundbeck reporting sites.

● Performed analytical review and trend explanation of the Sustainability Data.

● Evaluated the evidence obtained.

Statement on other sustainability information mentioned in the report

Management of Lundbeck is responsible for other sustainability information communicated in the 2022 Lundbeck Sustainability Report. The other sustainability information on page 1-29 and 34-37 of the 2022 Lundbeck Sustainability Report comprises the sections ‘Introduction’, ‘Unmet patient needs’, ‘Business Ethics’, ‘Climate Change and Circularity’, ‘People and Communities’, Reporting according to climaterelated financial disclosures (TCFD) and Reporting according to the EU taxonomy regarding Lundbeck’s 2022 sustainability approach, activities and results.

Our conclusion on the Sustainability Data on page 30-33 and 38-46 does not cover other sustainability information and we do not express an assurance conclusion thereon. In connection with our review of the Sustainability Data, we read the other sustainability information in the 2022 Lundbeck Sustainability Report and, in doing so, considered whether the other sustainability information is materially inconsistent with the Sustainability Data, our knowledge obtained in the review or otherwise appear to be materially misstated. We have nothing to report in this regard.

Management’s responsibilities

Management of Lundbeck is responsible for:

● Designing, implementing and maintaining internal control over information relevant to the preparation of the Sustainability Data in the 2022 Lundbeck Sustainability Report that are free from material misstatement, whether due to fraud or error;

● Establishing objective Sustainability Accounting Policies for preparing the Sustainability Data;

● Measuring and reporting the information in the Sustainability Data based on the Sustainability Accounting Policies; and

● The content of the 2022 Lundbeck Sustainability Report.

Our responsibility

We are responsible for:

● Planning and performing the engagement to obtain limited assurance about whether the Sustainability Data for the period 1 January - 31 December 2022 are prepared, in all material respects, in accordance with the Sustainability Accounting Policies;

● Forming an independent conclusion, based on the procedures performed and the evidence obtained; and

● Reporting our conclusion to the Stakeholders of Lundbeck. Hellerup, 8 February 2023 PricewaterhouseCoopers Statsautoriseret

Lundbeck Sustainability Report 2022

H. Lundbeck A/S

Ottiliavej 9

2500 Valby Denmark

Corporate Communication & Public Affairs

Tel. +45 36 30 13 11

information@lundbeck.com www.lundbeck.com

CVR number 56759913

Since

Our purpose

cf. sections 99a, 99b, 99d and 107d of the Danish Financial Statements Act

We strive today to make a better tomorrow for those we care about most – people living with allergies. In everything we do, we want to provide solutions that make life with allergies surprisingly simple.

Introduction

Our current focus areas

ALK's approach to sustainability encompasses four key themes to ensure sustainability for people, planet and the business. Our `Access to allergy care´ strategy describes our ambition and goals to make ALK solutions more universally accessible, while reducing our impact on the planet.

ALK continues to build on our 2022 progress by helping even more people with allergies and strengthening our sustainability efforts even further.

Commitments

We continue to support the 10 Principles of the UN Global Compact and remain an active signatory. In addition, we have committed to setting a new CO2 reduction target according to the Science Based Targets methodology to align ourselves with the goals of the Paris Agreement to limit global warming to 1.5°C above pre-industrial levels.

2022 progress

We experienced continued progress across all our current focus areas: `Access to allergy care´, `People´, `Environment´ and `Responsible business practices´.

ALK is driven by a strong purpose to help people who suffer from allergies. We are therefore pleased to see our Access to

Allergy Care targets were especially exceeded this year, underlining our commitment to bring more people back to nature with our range of diagnostics, allergy immunotherapy treatments, and services. Our efforts significantly reduce the burden of living with allergies to both the individual and society in general, as more people can be treated faster.

ALK is growing as a company and has increased the amount of medicines available to people with allergies globally. Despite this growth, we saw an overall reduction in our CO2 emissions. However, our emissions of flight travel following the lift of COVID-19 travel restrictions increased as there was a strong need to meet face-toface and reconnect across the business. We will be working to reduce these emissions going forward, as we set new science-based CO2 reduction targets. We look forward to continuing our CO2 reduction journey in 2023, based on a more comprehensive and ambitious framework.

In 2022, we updated our Governance Model to ensure ESG data progresses towards the same standards as the financial data. Going

“Improving access to allergy care is our greatest opportunity to positively influence our business and society in general.”

Carsten Hellmann, President and CEO

Access to allergy care Environment and climate change

Responsible business practices

Inclusive culture and diverse workforce

ALK's sustainability journey

forward, the Board of Director’s Audit Committee will oversee all sustainability and ESG disclosures, processes, controls, and assurance as an integrated part of the Committee’s annual wheel.

Our strategic priorities at ALK are guided by continuous stakeholder engagement, and upcoming standards. In 2022, we collected valuable input from our employees at global and local meetings, our employee engagement survey, and ALK Learn sessions (our internal learning platform), as well as from several meetings with investors strongly engaged in sustainability. We also conducted a gap analysis comparing our current reporting with the upcoming requirements in the Corporate Sustainability Reporting Directive (CSRD) and will be aligning our reporting over the coming years as the standards come into force.

Focus points of 2023 and beyond

While the Board of Directors assessed and confirmed our short- and long-term priorities, we will be identifying new

sustainability targets in all four of our focus areas to ensure that our commitments continue to be reflected by our actions.

Expanding access to allergy care to become relevant to even more people with allergies, will remain our main priority. As a pharmaceutical company producing allergy treatments with source materials originating from nature, we will also be prioritising and addressing biodiversity impacts and mitigation efforts Other key priorities going forward will be to grow our insight on double materiality –how ALK impacts climate change, and how climate change impacts ALK’s business – and further strengthen our sustainability policies and disclosures to reflect developments in sustainability reporting, due diligence and transparency.

We are on an ambitious growth journey and will continue to make our solutions more universally accessible, while ensuring a sustainable business model throughout ALK.

Best regards,

Carsten Hellmann President & CEO

Sustainability performance 2022

We have exceeded, or are on track to meet, all our ESG targets ahead of schedule.

Becoming relevant for more people with allergy

ALK is a global allergy solutions company with a wide range of diagnostics, allergy immunotherapy (AIT) treatments, and services to meet the unique needs of allergy sufferers, their families, and doctors around the world.

100 years’ profound understanding of allergy

Research & development

2022 results

~2.4 million patients in treatment with ALK products

2,700 employees with diverse talents

Insights from academia, patients and partners

ALK is a world leader in respiratory allergies and holds emerging positions in food allergies and anaphylaxis. Its business model is centred around strong R&D skills, insight into immunology, unique manufacturing processes, and a desire to bring the best of modern science to the allergy field. Based on the industry’s most comprehensive clinical data set and insights into patient behaviour, ALK wants to transform the clinical landscape from experience-based to evidence-based medicine for patients, practitioners and payers.

>700,000 people mobilised digitally to find a doctor

85% of adults with respiratory allergy covered by tablets

4,250 healthcare professionals trained or educated by ALK

11% three-year average organic revenue growth

41% reduction of CO2 emissions vs. 2019 baseline

Number of countries where tablet-based allergy immunotherapy treatment was introduced in 2022:

+2

China (Boao Lecheng) and United Arab Emirates

Access to allergy care

New patients in 2022:

+300,000

Increasing patients in treatment to 2.4 million

Training of healthcare professionals since 2020:

8,050

We exceeded our target to reach 4,000 healthcare professionals by 2022

Number of countries where children & adolescent indications were approved in since 2020:

12

We exceeded our target of 10 new country indications by 2025

Access to allergy care

The burden of living with allergies to both the individual as well as society is tremendous. At ALK we seek to ease this burden by providing better treatment options, expanding treatment access and enabling faster diagnosis.

More than 500 million people worldwide have allergies1

Many of them suffer in silence unnecessarily without clear avenues for support and treatment. We wish to bring people living with allergies back to nature by improving access to effective and clinically proven allergy diagnosis and treatment solutions to improve the lives of the individual and reduce the burden on already strained healthcare systems around the world.

The world we live in is changing; pollen counts are increasing, and plants are migrating geographically to areas with longer and earlier pollinator seasons

due to climate change2. This means that seasonal allergies are lasting longer and are becoming more severe3. As the prevalence and severity of respiratory allergies increases, we work internally in ALK and with our business partners to address the climate crisis and to improve access to diagnostics and treatments for respiratory allergies.

As of 2022, over 2.4 million people worldwide rely on ALK allergy diagnostics, allergy immunotherapy (AIT) treatments and/or adrenaline products, an increase of +300,000 patients from 2021, well in line with ALK’s 2023 aspirations.

Expanding our geographical reach

The number of people with allergies has risen steadily in the past 60 years, with higher incidence rates among children.

It is expected that by 2050, half of the population will suffer from respiratory allergies 4. To help more people, we are expanding our AIT and adrenaline products to additional countries, either by our own power or through partnerships, which often

form the first step in making ALK solutions available in countries with no access to AIT.

In 2022 we extended the reach of our tabletbased AIT products to the United Arab Emirates and the Boao Lecheng Pilot Zone in China – the first step towards making ALK’s house dust mite tablet available in mainland China by 2024/25, subject to regulatory approval. We also entered into a partnership with Dr. Reddy’s Laboratories which eventually will lead to the introduction of our house dust mite tablet in India.

Our partner, GrandPharma, continued its preparatory work to register and launch ALK’s auto-injector Jext ® in China, while ALK continues the development of a next-generation auto-injector ahead of a planned submission to the US FDA in 2024.

2030 Commitment: Enable access to ALK allergy diagnosis, immunotherapy treatments and/or adrenaline products by increasing the number of patients by at least 100,000 annually.”

Access to allergy care strategy, 2020

Meanwhile, we initiated a Phase I trial with a tablet treatment for peanut allergy – an important step in our quest for developing new, mainstream treatments for potentially life-threatening food allergies. Find out more Go to p. 32 for reference list

Saving lives with Jext ®

Our adrenaline pens Jext ® are used every day to save lives in cases of anaphylaxis caused by allergies. However, the pens are also used for people suffering cardiac arrest from severe trauma.

Following the outbreak of war in Ukraine, ALK was approached by Ukrainian authorities for medical support. We met this request by donating 25,000 Jext ® pens. Together with devices and medicines from other pharma and medtech companies in Denmark, the pens were shipped directly to Ukraine to help victims of the war.

Approvals for children and adolescents

To service the increasing number of youth with respiratory allergies, we continue to progress our approvals for children and adolescents to ensure diagnosis and treatment much earlier in life. In 2022, two new approvals for children and/or adolescents were secured in Serbia and Canada, advancing our commitment towards full paediatric coverage across the tablet portfolio. Key initiatives in this respect are the ongoing, transatlantic paediatric Phase III trials in allergic rhinitis (MT-12 for the house dust mite tablet and TT-06 for the tree pollen tablet), both due for completion in 2023.

Furthermore, we are currently gathering data showing a correspondence between allergies in children and lower grades and academic achievements in school, indicating that early treatment and diagnosis may also have a positive impact on the academic performance of children.

Engaging with practitioners and patients

We engage systematically in educational activities, training and dialogue with healthcare professionals to enhance insights into diagnosis and treatment of allergic diseases. Much of our engagement is done through digital platforms enabling us to reach more healthcare professionals within a shorter time and reduce our climate impact from travelling to physical meetings. As an example, our Digital Area Sales Manager in Norway held more than 50 digital meetings with healthcare professionals in 2022. If meetings had been held physically this would have required more than 80 flight trips and 16,000 kilometres driven.

2023 will see a further move towards multichannel marketing through increased digitisation of communication with healthcare professionals using insights from a new customer relationship

Jext contains a sterile solution of adrenaline within an auto-injector for emergency injection of a single dose of adrenaline into the outer thigh muscle.

“2030 Commitment: Educate 200,000 healthcare professionals and establish partnerships to train 50,000 healthcare professionals in allergy treatment and immunotherapy.” Access to Allergy Care strategy, 2020

management system that will be rolled out globally after a successful test phase in the Nordic countries.

Since 2020, we trained 8,050 healthcare professionals in allergy and AIT treatment and educated 55,000 healthcare professionals in allergic disease innovations via scientific communication, exceeding our 2022 targets of 4,000 and 20,000, respectively. Additionally, we engaged with patient organisations all over the world to raise awareness about patient care and product safety.

Our Klarify digital platform was launched in Switzerland, Austria, the Netherlands, the Czech Republic, and Slovakia in 2022. The platform is now available in 11 countries

and aims to empower people to take action on their allergies by offering information and guidance on how to avoid or alleviate symptoms. In 2022, more than 700,000 consumers found a doctor using ALK’s Consumer-to-Patient ecosystem, where ALK digitally takes consumers by the hand pre- and post- doctor visits.

ALK also made progress in pilot projects aimed at eliminating friction points on the path to prescription for the many untreated patients eligible for AIT treatment. This work will continue in 2023.

Access to allergy care has two guiding principles:

• Focusing primarily on people with allergies and their need for correct diagnosis and treatment

• S upporting healthcare providers and professionals is a precondition for providing efficient allergy care. Without a healthcare infrastructure, people with allergies cannot benefit from our allergy solutions

In this area we support:

UN Sustainable Development Goals

Go

Søren Niegel, Executive Vice President,

Klarify

is ALK's digital platform providing tools to better manage allergy symptoms.

“Training healthcare professionals is an important commitment for ALK. By disseminating latest knowledge about diagnosis, treatment options and support solutions to people living with allergies, we contribute to making more healthcare professionals able to treat earlier, more efficiently and more effectively”.

Commercial Operations

Injury frequency 1.7

We reached our goal of keeping injury frequency below 3.0

People

Female managers and directors:

53%

We reached our 2025 goal of approximately 50% women at manager and director levels

Female vice president and senior directors: 34%

We expect to reach our goal of 35% female vice president and senior directors before 2025

Female shareholder-elected board members: 29%

We will be updating our target in 2023 according to new legislation §99b on gender representation

People

Building a cohesive organisation by connecting with colleagues supports our growth ambitions and our ambition to create a good work environment with high engagement.

demands of workload´, and ´career advancement and skills development´ were two areas in focus in 2022 and will continue to be so going forward, as ALK offers specific support to mitigate workload issues and identifies additional ways to develop and train leaders and employees.

Engagement and retention

The 2022 results of our employee engagement survey exceeded our expectations. With a participation rate of 95% globally, we have a very high validity of the results. Global engagement increased from 8.2 (on a 10-point scale) in 2021 to 8.3, and we saw improvements across all engagement drivers. The engagement result is 0.7 points above the healthcare benchmark and in the top-5 percentile. In addition to the high index scores, we received more than 11,000 employee comments.

Though the results were good, there are areas for further development; ´managing

Employee turnover was 13% in 2022 (2021: 13%), reflecting a very high demand for skilled labour in key locations, particularly in the first half-year, both in the healthcare industries and other sectors. Although ALK shares this challenge with other employers in the healthcare industry, we continue to focus on retaining our employees by seeking to ensure an engaging work environment.

Employee development

Development opportunities continue to be one of the major drivers of employee engagement and is key to our success. We invest in training and developing all employees through job assignments and training activities. Additionally, our ASPIRE

program identifies talents globally. At the corporate level, ASPIRE focuses on two talent groups; Key Talents with potential to become part of senior management, and Early Career Talents who are at the beginning of their career. For both groups, comprising a total of 69 talents as of 2022, strong individual development plans are established and supported by the Board of Management. Furthermore, we trained 150 leaders from across ALK through our Leading with Impact program for seniorlevel leaders, educating them on agile and inclusive leadership. In addition, 162 managers and supervisors across Product Supply were trained in how to further strengthen the manufacturing excellence mindset through our global Manufacturing Excellence program.

As a part of the annual development agreement for all employees, performance, goals and ambitions are discussed with the manager. These dialogues enable a strong, continuous feedback culture as a mechanism for ensuring positive

“Building a cohesive organisation is important for us at ALK. We are therefore very pleased with our high employee engagement score. We will continue to support employee growth and development ambitions, as well as promote a strong company culture through our values and purpose in order to maintain a sense of pride in our daily work .”

Lisbeth Kirk, Senior Vice President, Human Resources, Sustainability and Internal Communications

professional development for the individual employee aligned to the business strategy.

scores in 2021 showed improved results in 2022.

Learning for all

ALK Learn is an internal learning platform for all employees. The purpose is to educate employees on topics of relevance to ALK and the individual. All sessions are virtual and held by either internal or external facilitators and when possible, recorded for future reference. In 2022, we had sessions on: ‘Finance for non-financials’, ‘Health & Wellbeing’, ‘Sustainability at ALK’, and ‘Understanding cultural differences’. The sessions on average attracted audiences of 300 employees.

Health & wellbeing

Based on input from last year’s engagement survey, we saw a need to focus on health and wellbeing across the organisation. 12 workshops were held with approximately 210 managers globally to help them facilitate conversations with employees about work priorities and address potential signs of burnout and stress. Human Resource support was also given to managers in departments with low scores for health and wellbeing. 4 out of 5 departments with low engagement survey

In addition to the global focus on psychological safety, various health initiatives were introduced locally. In the USA, Wellness@ALK was introduced to secure physical and mental well-being through action. Over the course of the year, Wellness@ALK encouraged all US employees to take part in their own wellness by offering a fitness challenge, a health risk assessment, and various wellness-related webinars. Response from employees was encouraging. Wellness@ ALK will continue in the USA in 2023 and further be introduced in Canada.

Safety of our employees

In 2022, we had six occupational accidents at ALK facilities (2021: 1), resulting in an injury frequency rate of 1.7 (2021: 0.3). The accidents were related to organisation of work. Root-cause analyses have been conducted to ensure that preventative measures are implemented. We ensure access to occupational healthcare services for all employees through healthcare coverage and insurance for work-related accidents or diseases.

wALK the tALK

In 2022, ALK focused on connecting employees across the organisation after two years with COVID-19 restrictions where many employees have been working from home.

We saw a strong need to meet in person and reconnect, but also to make sure that everyone is aligned and informed about our strategy and purpose. Therefore, we introduced wALK the tALK meetings at sites where employees could meet, get inputs from specialists and people who suffer from allergies, and also ask questions directly to local and senior management. wALK the tALK events took place at 12 sites across 9 countries in 2022, and additional meetings are planned for 2023.

Søren Niegel, EVP, Commercial Operations, answers questions from employees at our site in Kungsbacka, Sweden

Workplace assessments are conducted regularly to ensure we mitigate health and safety risks. Safety training is adapted to local needs and allows flexibility in line with local laws. All relevant employees are trained in the Chemical Management System, which contains our safety data sheets and describes common hazards and the precautions to be taken.

We will continue to monitor risks related to safety, health and well-being in 2023 and continue to focus on securing a safe and healthy workplace. In 2023, we will implement an updated risk matrix to strengthen insights on the severity of our incidents.

Diversity and inclusion

Diversity and inclusion principles are integrated into our key processes such as talent management, succession planning, mentoring and sponsorship programmes, unconscious bias training, flexible working options, regular pay-gap assessments, and paid parental leave. Our engagement survey helps to shed a light on the perception of inclusion related to these elements. The 2022 results showed an improvement in the diversity and inclusion score from 8.0 in 2021 to 8.3, but we do see a need to expand and

improve these elements in 2023. We believe that diversity and inclusion at all levels delivers better business results, and our ambition is to continue building an inclusive work environment that fosters a sense of belonging, where different perspectives, abilities, talents and experiences are valued.

In 2022, we took a further step towards reaching our goal of increasing gender representation at vice president and senior director levels. 34% of the vice presidents and senior directors are women, up from 29% in 2021. We aim to achieve 35% female representation by 2025 at the latest. These steps help to strengthen the pipeline towards representation in senior vice president and executive vice president positions.

Our distribution of men and women at manager and director levels remained within our target of maintaining a gender balance of approximately 50%, with 53% women in 2022, unchanged from 2021. In 2023 we will set a new target for gender representation in senior management, following the new guidelines for §99b.

Move for Allergy

Our annual ‘Move for Allergy’ event emphasises the importance of collaboration, interconnectivity and having a sense of belonging. The event connects colleagues on the same day all around the world by encouraging everyone to exercise either by walking, running or cycling – alone or in small groups.

Our Guangzhou office employees in China enjoyed our Move for Allergy initiative by taking a walk together on Guangzhou international bio-island.

ALK’s cultural beliefs

In 2022, ALK hired 555 new employees (2021: 487), 63% of which are women (2021: 58%). The gender pay ratio (men to women) among all employees was 1.14 (1.18 in 2021).

The Board of Directors

ALK’s Board of Directors consists of seven shareholder-elected members and three employee-elected members. Two shareholder-elected members are women, corresponding to 29% female representation. We will be updating our target as the new legislation §99b on gender representation comes into force in 2023.

In addition, two of the employee-elected members are women, and three of the shareholder- elected members have nationalities other than Danish. Four of the shareholder-elected members are independent according to the definitions set by The Danish Committee on Corporate Governance.

The Remuneration and Nomination Committee is responsible for the selection and nomination of candidates for the Board of Directors. Selection is assessed by the Board of Directors and is based on a transparent process that defines the desired

profile, taking into account the need for new talent, diversity, age and gender. Our diversity targets and results are disclosed in line with cf. section 99b and 107d of the Danish Financial Statements Act.

Human rights and labour rights

We support the UN Guiding Principles on Business and Human Rights, and our work with human rights is an integrated part of our support to the UN Global Compact.

Our high-level risk assessment of human rights and labour rights was updated in 2022. We continue to recognise health and safety, antidiscrimination and general working conditions at our own sites as important focus areas. We have not identified any signs of adverse human rights impacts in 2022 at our own sites or with our suppliers.

Activities are enforced through policies, actions, targets and training, as well as grievance mechanisms and our whistle-blower function –ALK Alertline. Please refer to section Responsible Business Practices for additional information.

Find

Find out more

ALK follows internationally recognised standards:

The Universal Declaration of Human Rights

The International Labour Organization’s Declaration on Fundamental Principles and Rights at Work

The UN Guiding Principles on Business and Human Rights

ALK policies on human rights and labour rights:

Code of Conduct

Conflicts of Interest Policy

Diversity and Inclusion Policy

Environment, Health and Safety Policy Harassment Policy

In this area we support:

UN Global Compact Principles 1-6

Build bridges Understand others’ perspectives Reach out to colleagues Help others to be a success Pursue growth Think ‘people with allergy’ first See change as an opportunity for improvement Look for better solutions Do the right thing Understand your role Take ownership and get the job done Have the courage to make tough decisions ALK Sustainability Report 2022 People 15

UN Sustainable Development Goals

Go to p. 32 for policy links

out more Find

Our CO 2 reduction:

41%

We will be setting a new target in 2023 according to the Science Based Targets methodology

Environment and climate

Our energy consumption in 2022:

46,800 MWh

We achieved our 2022 target to not exceed the 2019 b aseline of 47,000 MWh

We reused or recycled waste:

59%

We achieved our 2022 target to reuse or recycle 47% of waste

Our water consumption in 2022:

116,500 m3

We achieved our 2022 target to not exceed our 2019 baseline of 122,000 m 3

Environment and climate

Climate change is chiefly an environmental issue, but it is also a serious threat to respiratory health.

Global warming can lead to longer allergy seasons and poorer air quality, triggering more severe allergy symptoms. As an allergy care company, ALK will contribute to mitigating anthropogenic greenhouse gas effects threatening respiratory health. In 2022 we committed to setting sciencebased targets in line with the goals of the Paris Agreement – limiting global warming to 1.5°C above pre-industrial levels.

Assessing and mitigating environmental risks

All ALK production sites adhere to our Global Environmental Health and Safety (EHS) policy and are covered by our Global EHS Management System. Accordingly, we continuously assess environmental and climate risks related to energy, CO2,

waste and water consumption. In 2022, no incidents of non-compliance with environmental laws and regulations were recorded through our internal systems (2021: 0).

Climate risk planning, mitigation and adaptation strategies are becoming increasingly important as the threat of droughts and flooding could affect the cultivation and collection of our allergenic source material. To mitigate these risks, we are distributing our crops across a wider range of locations in the USA and Europe to secure a stable supply of allergenic source materials, and we will continue to assess climate risk planning, mitigation and adaptation strategies in 2023, including a materiality risk assessment of climate impacts on our own operations and along the value chain.

Preparing science-based targets

Although our CO2 emissions are relatively low compared to many other industries, reducing CO2 emissions is imperative

for ALK. In 2022, we saw a need to align our existing CO2 emission target with an established framework, and therefore committed to setting science-based targets. We have since engaged with an external partner to validate data and reduction initiatives for scope 1, 2 and 3 emissions, and we will be setting, communicating and reporting our updated targets in 2023.

Working with the external partner, we developed a better understanding of the transition needed to reduce scope 1, 2 and 3 emissions. We have already introduced a series of initiatives to decrease scope 1 and 2 emissions, including an increased focus on renewable energy, implementing energy efficient initiatives, and promoting the addition of electric cars to our company fleet. We will continue investigating material categories in line with our sciencebased targets commitment.

We have established a framework for accounting and reporting on our scope 3

“Although we are already taking measures to reduce our CO2 emissions, committing to science-based targets pledges our alignment with the Paris Agreement, both at our own sites and throughout our supply chain. Our contribution to limiting anthropogenic climate change through this commitment will help to ensure a healthier environment, as well as a healthier society.”

Christian Houghton, Executive Vice President, Product Supply

emissions (1st leg distribution and flight travel). This expanded documentation showed that a large part of our emissions derive from flight travel, which increased this year following the lift of COVID-19 travel restrictions. However, we saw an overall decrease in scope 1 and 2 emissions, as well as greenhouse gas intensity per net revenue. These are all signs that we are taking good steps towards achieving a net reduction in CO2, despite growing as a business. We will continue these reduction initiatives and increase our focus on reducing flight travel with our improved scope 3 transparency. We look forward to continuing our CO2 reduction journey in 2023 based on a more comprehensive and ambitious framework.

Energy consumption

We continue to advance our efforts to reduce energy consumption and promote renewable energy use. Several initiatives were implemented in 2022 supporting these efforts. Our Hørsholm, Denmark site

installed steam vessels to generate heat for manufacturing processes, which run on certified CO2 -neutral wind electricity rather than the previous natural gas source. Additionally, our Vandeuil, France production site optimised the heat recovery of a cold unit, which allowed the shutdown of a gas boiler previously responsible for providing hot water in half the plant.

We continue to focus on increasing our renewable energy consumption and purchase renewable energy certificates audited by independent third parties where 100% renewable energy consumption is currently unavailable. Total energy consumption was 46,800 MWh in 2022 (2021: 46,000), achieving our 2022 target of not exceeding the 2019 baseline of 47,000 MWh.

Waste management

Reducing, reusing and recycling waste are important steps in minimising our environmental impact. We therefore try to incorporate circular economy concepts at

The transition to renewable energy is an important initiative for ALK. 53% of our energy consumption comes from renewable sources, and renewable energy certificates are purchased where renewable energy consumption is currently unavailable.

every step of our business, for instance by replacing plastic products with recyclable cardboard packaging where possible.

At our Post Falls, USA site, we promote circular economy initiatives by using part of the nutritional content from the house dust mites that we cultivate, as a soil supplement for the fields where we harvest grass and tree pollen. The remaining house dust mite process material is sold as a bulking agent for wastewater treatment facilities.

We continue to optimise waste management with the goal of achieving zero landfill waste. We aim to improve waste recovery and sorting, and handle expiry dates for chemicals to avoid unnecessary waste. As an example, our two production sites in France have implemented selective waste sorting with a supplier waste recycling system to ensure component reuse. Non-recoverable waste such as chemicals are incinerated in efficient plants with heat recovery, electricity production and recovery of components. As a result, 59% of waste is reused or recycled over all our sites, up from 50% in 2021, and in line with our goal of 47% waste recovery by 2022.

Total waste from production sites was 1,135 tonnes (2021: 880). This increase is due to improved documentation of waste fractions rather than an actual increase of waste production at our sites

Water

Water is an important resource in our production and cultivation of our allergenic source materials such as grass, birch and ragweed pollen. We are therefore increasing our focus on reducing water use at all levels of the business. We have initiated a replacement of our water for injection (WFI) production system in Hørsholm, Denmark with an industrial water treatment system, which will save both water and energy consumption when installation is complete in 2025. Additionally, the site has installed steam generators which will divert roughly 1,500 m 3 of wastewater. The same water will be reused again as it condenses, is cooled by water designated for heating the building, and returns into the steam system, resulting in 10% energy savings on building heating. This process is currently under construction and is expected to be implemented in 2023.

ALK sustainability award

In 2022, a global sustainability award initiative was announced, where one ALK team would be given an award in recognition of their daily achievements benefitting people with allergies and the environment.

In 2022, the sustainability award was granted to the project team in France who worked hard over the past two

years to replace plastic packaging with biodegradable cardboard for ALK’s allergy immunotherapy drops brand OSIRIS®. This switch has reduced CO2 emissions of the packaging by 95%, saved packaging costs, and allowed for more colours on the packaging, making it easier for people with allergies and healthcare professionals to recognise the product. The sustainability award initiative will continue in 2023, in an effort to encourage teams to consider sustainability in their daily operations and decisions.

OSIRIS® is ALK's immunotherapy drop brand administered under the tongue at home, avoiding the need for regular doctor visits. Our new colourful and biodegradable packing makes product recognition easier for people with allergies.

In 2022, overall water consumption was 116,500 m 3, meeting our 2022 target to not exceed the 2019 baseline of 122,000 m 3

Biodiversity

As a manufacturer of biological medicines based on nature derived allergens, ALK acknowledges the importance of biodiversity for securing existing and novel pollen solutions, which could be under threat due to species and habitat decline. We are therefore taking steps to make a positive impact on biodiversity at our sites where we cultivate allergenic source materials, including the integration of sustainable farming practices into our daily work. As an example, our Post Falls, USA facility utilises GPS data to increase specificity of pesticide application, plants nitrogen-fixing species in our crop rotations, applies Integrated Pest Management principles to minimise pesticide use, and integrates natural and semi-natural habitats on our land. Additionally, our organic birch farm pilot project in Tri City, USA yielded its first harvest in 2022, and we will continue to investigate this method of production in the future to potentially apply the method elsewhere.

We will continue to expand on our biodiversity initiatives into 2023 and beyond, such as exploring alternative crop rotations, utilising cover crops during the winter, and testing no-till or minimum-till farming practices.

EU taxonomy

We have performed an eligibility screening of our activities to report under Article 8 of the EU Taxonomy Regulation1. It is our conclusion that none of our revenue is derived from products or services associated with activities included in the Climate Delegated Act2, and as such we do not have any eligible turnover. We have also screened our capital (CapEx) and operational (OpEx) expenditure. The activities assessed include, but are not

limited to, waste management, transport, and construction and real estate. Our capital and operational expenditure screening identified some activities which could be classified as eligible. This included the steam generators installed at our Hørsholm site (Activity 7.6 - renovation of existing buildings). Other activities were also identified as potentially eligible (our company cars, facilities and other minor expenditures). However, due to a need to further develop our reporting foundation and processes related to reporting according to the EU Taxonomy, we have chosen to report none of our capital and operational expenditure as taxonomyeligible for 2022. For accounting policies on revenue, CapEx and OpEx please see consolidated financial statement in the 2022

ALK follows internationally recognised standards:

Greenhouse Gas Protocol EU Taxonomy

ALK policies on environment and climate:

Code of Conduct

Environment, Health and Safety Policy

In this area we support:

UN Global Compact Principles 7-9

UN Sustainable Development Goals

Science Based Targets

Go to p. 32 for policy links

Employees trained in Code of Conduct:

95% Exceeding our target of 90% participation rate

Responsible business practices

Responsible business practices

ALK is committed to conducting business ethically and responsibly, as well as ensuring that all stakeholders in our value chain act with integrity. We are committed to comply with all relevant laws, guidelines and international standards in every aspect of our operations.

Continuous training efforts

ALK conducts annual Code of Conduct training for our employees, available online in seven languages. All employees are additionally required to acknowledge that they have read and understood the Code of Conduct. In 2022, 95% of our employees (2021: 97%) completed the internal Code of Conduct training. In 2023, we will take steps to provide additional training especially on anti-corruption, fair competition and interaction with healthcare professionals for selected employee groups.

structured and documented supplier risk assessments. 26 key suppliers were initially assessed in 2022, and we continue to broaden the scope by evaluating more suppliers in 2023.

Forced and child labour

fraud and bribery. ALK employees are only allowed to give or receive gifts or hospitality which are modest, appropriate and infrequent. Additional restrictions apply when interacting with public officials, healthcare professionals and patient organisations. No corruption cases were identified in 2022.

Our Code of Conduct describes the required standards of behaviour for our interactions with stakeholders and outlines the expectations of all ALK employees when it comes to professionalism, honesty and integrity. The Code of Conduct addresses ALK's policies related to responsible business practices. Additionally, our Third-Party Code of Conduct describes the required standards of behaviours for third party stakeholders, including suppliers, and specifically outlines requirements regarding human rights issues.

Interactions with third parties

Our Third-Party Code of Conduct specifically outlines our expectations for interactions with suppliers and other third parties. No observations of violations were made in supplier assessments in relation to human rights, labour rights, the environment and anti-corruption in 2022.

In 2022, we formalised a partnership with EcoVadis, a digital supplier evaluation platform, to enable more accurate,

We have a zero tolerance towards child and forced labour, as stated in our employee Code of Conduct and Third-Party Code of Conduct. We continue to engage proactively with suppliers through collaboration and open dialogue to ensure compliance with our Third-Party Code of Conduct, and we focus on supplier transparency to assess the risk of child and forced labour through our due diligence process for third parties. We adhere to the 2015 Modern Slavery Act and publish an annual statement according to its requirements.

Anti-corruption

We uphold our commitment against corruption in all its forms and continue to take a zero-tolerance approach to corruption, including facilitation payments, kickbacks,

Ethics hotline: ALK Alertline

We encourage employees and other stakeholders to report, in good faith, serious and sensitive concerns within the scope of our Whistleblowing Policy. Guidance on how to raise concerns regarding unlawful behaviour or violations of ALK´s policies, including the Code of Conduct, are part of ongoing awareness campaigns and annual training. Both employees and other stakeholders can file reports via ALK Alertline in multiple languages, either by phone or via an online form.

In 2022, a total of 11 cases were raised (2021: 8). All closed cases were diligently investigated, and appropriate remedial actions were taken. No disciplinary actions

ALK holds a quality mindset and culture across the organisation.

were needed. Three investigations are still ongoing.

Risk Assessment

We conduct risk assessments on an ongoing basis to guide us on where select attention is required. The risk assessments, which amongst other things, cover anti-corruption and bribery risks, are conducted internally together with the relevant business units to ensure a comprehensive overview of the business and its risks. Based on the risk assessments, we revise our compliance programme as required.

High quality healthcare products

Quality is a strategic priority for ALK, as it concerns both patient safety and public health and ensures standardisation and consistency of our products.

Meeting quality standards in our production and manufacturing processes is a prerequisite for ALK’s licence to operate and is our competitive strength. To mitigate risks, we invest significantly in ensuring robustness and compliance in our processes, personnel training and manufacturing facilities. We adhere to GxP requirements described in various procedures within our Quality Management System.

Production and manufacturing processes are subject to periodic and routine inspections by regulatory authorities. In 2022, two (2021: 3) authority inspections of our manufacturing sites were successfully completed.

Patient safety

ALK has a rigorous safety reporting system in place ensuring that safety data from any source, including clinical trials, are collected and analysed systematically by ALK’s global pharmacovigilance team. This ensures that the safety profile of our products stays beneficial, and the relevant authorities can be made aware of any safety issue arising from our products.

The main risks related to our products come from failures to report side effects. We monitor the effects both before and after products gain marketing authorisations. If a situation should occur in which it is necessary to recall a product, ALK has procedures in place to ensure swift and efficient management of the situation. During 2022, ALK issued four product recall notices (2021:1).

In 2023, we will continue to strengthen the quality mindset and quality culture across the organisation as we train employees, roll

out systematic problem-solving tools and develop employees through online training frameworks.

Clinical trials

We conduct clinical trials in close collaboration with authorities, healthcare professionals, scientists and people with allergies. Safety, privacy, ethics and respect are the foundation of our clinical trials. We are committed to the EFPIA and PhRMA Principles for Responsible Clinical Trial Data Sharing. In this way, we share data in a manner that safeguards the privacy of patients, respects the integrity of national regulatory systems and protects proprietary information.

Animal welfare

Animal welfare is a focus throughout our research and development of new medicines. We select professional, well-recognised and accredited suppliers, according to the Federation of European Laboratory Animal Science Associations’ (FELASA) guidelines. Our commitment to animal welfare also covers the shipment and transport of animals to our animal facilities.

Alternative approaches to replace the use of animals are implemented whenever possible. This strategy is known as ´the three R’s:

replace, reduce and refine´. Each experiment is carefully assessed for value gained to assure that no experiments are performed that will not justify the use of animals over alternatives. We strive to avoid any unnecessary repetition of animal studies and conduct testing on the cellular level whenever possible to minimise the number of animals needed for research.

Data ethics

As a pharmaceutical company, ALK processes data from clinical trials, research and development, human resources, customer interactions and pharmacovigilance. We utilise data to expand scientific and medical understanding, ensure patient safety, generate a firmer evidence base to improve our products and services, and deliver treatments to the right patients with the right commercial potential, efficiently and sustainably.

Our Data Ethics Policy adhere to applicable laws which respect people’s privacy and ensures ethical considerations, such as sharing data responsibly and avoiding bias when using algorithms. We apply our Data Ethics Policy in the absence of formal legal requirements. The management of data ethics is carried out by relevant business

units, who have integrated these principles in their work. We commit to mitigating risks and resolving grievances through our internal procedures or, if relevant, in collaboration with stakeholders. This constitutes our reporting according to cf. section 99d of the Danish Financial Statements Act.

Privacy and data protection

In 2022, we continued to work on ensuring and increasing the safe and responsible use of data in line with data protection regulations like the General Data Protection Regulation (GDPR). There were no data breaches reported to any Supervisory Authority in 2022. We continue our global awareness campaign to avoid phishing attacks, and we conducted several data protection trainings during 2022 to support employee awareness when processing personal data.

Responsible tax management

ALK’s Tax Policy covers both direct and indirect taxes and applies to the whole ALK Group. Responsible tax management implies a commitment to tax compliance in line with applicable best practice guidelines issued by the OECD.

ALK follows internationally recognised standards:

European Federation of Pharmaceutical Industries and Associations (EFPIA)

The Ethical Committee for the Pharmaceutical Industry (ENLI)

The International Federation of Pharmaceutical Manufacturers and Associations (IFPMA)

The UK Bribery Act

The US Foreign Corrupt Practices Act

The Universal Declaration of Human Rights

ALK policies for responsible business practices:

Anti-corruption Policy

Code of Conduct

Data Ethics Policy

Data Protection Policy

IT Security Policy

Third Party Code of Conduct

Quality Manual

Stakeholder & Communications Policy

Tax Policy

Whistleblowing Policy

In this area we support:

UN Global Compact Principles 10

UN Sustainable Development Goals

Find out more about the 2022 UK Modern Slavery Act statement about how to contact the external Alertline

Go to p. 32 for link

See the detailed ESG data on p.29

Appendix

Our work with sustainability

Sustainability reporting principles

ALK seeks to align with the draft European Financial Reporting Advisory Group (EFRAG) standards as guidance to determine report content, policies and disclosures. The reporting period covered by this report extends from 1 January to 31 December 2022.

Governance

ALK’s sustainability planning and activities reflect actual and potential risks and opportunities covering human rights, labour rights, climate and environment, and anti-corruption – directly or via ALK’s suppliers and partners. The Board of Directors is responsible for the strategy and the Board of Director’s Audit Committee oversees all sustainability/ESG disclosures, processes, controls and assurance.

Board of Directors

Board of Directors

Overall responsible for ALK’s sustainability strategy and purpose

Audit Committee

Audit Committee

Responsible for overseeing Sustainability/ESG disclosures, processes, controls and assurance

Board of Management

Board of Management

Responsible for approval of all sustainability-related policies, development of strategy and purpose

Sustainability Committee

Sustainability Committee

Responsible for ensuring implementation and monitoring of sustainability-related policies and governance

Sustainability Department

Sustainability Department

Responsible for coordinating and supporting implementation and daily management of the sustainability strategy, including identifying and monitoring risks and relevant, complete, consistent, transparent, and accurate reporting. The Sustainability Department is also responsible for advising policy owners on policy content

Business Units

Business Units

Responsible for daily management, monitoring and execution of the sustainability plans of action. Responsible for reporting to the Sustainability Department on a quarterly basis

Reporting scope

The environmental data in this report covers ALK’s production sites in the USA, Denmark, Spain and France. All other data regarding human rights, labour rights and responsible business practices cover the entire ALK Group, unless otherwise specified. Data from 2019 is used as the baseline for our sustainability work and reporting.

Due diligence, risk management and grievance mechanisms

The ALK Risk Committee assists the Board of Management with the overall responsibility of risk management. The ALK Risk Committee meets at least twice a year. The committee assesses risks and mitigation strategies relating to the entire ALK Group, including significant sustainability related risks. With regards to Third Parties, ALK assesses suppliers and other business partners through due diligence processes in the Procurement and Legal departments to minimise risks.

Employees and other stakeholders can report serious and sensitive concerns through Alertline which serves as our grievance mechanism.

Transparency

Our commitments, efforts and goals are disclosed in our Sustainability Report and on our website, and follow the Danish Financial Statements Act sections 99a, 99b, 99d and 107d. Further details of the risks associated with the Danish Financial Statements Act can be found in ALK’s Annual Report.

ESG key figures –

ESG key figures – People/Social

ESG key figures – Responsible business practices

Business Ethics

Definitions of calculations

Environment and climate

All environmental data is reported for main production sites (Hørsholm, Madrid, Oklahoma, Post Falls, Port Washington, Vandeuil and Varennes). Some figures have been corrected from previous years due to improved reporting and documentation of data.

CO 2 emissions

ALK adheres to the principles of the Green House Gas (GHG) Protocol when reporting on emissions. Emissions are measured in metric tonnes of CO2 equivalents according to Global Warming Potential values published by the IPCC based on a 100-year time horizon.

Scope 1 emissions include direct energy consumption (natural gas, gas oil, diesel and petrol), where emission conversion factors are calculated using the UK's Department for Environment, Food and Rural Affairs (DEFRA) calculation methodology, supported by the GHG Protocol. Scope 1 also includes company car emissions, which are estimated based on fuel type and either fuel consumption or mileage of company cars. Fuel consumption or mileage in December, and in some cases November, were estimated based on average monthly consumption or mileage over the year. Emission conversion factors are calculated using the DEFRA calculation methodology. Scope 1 also includes emissions of ozone-depleting substances, which are defined as those listed in the Montreal Protocol on Substances that Deplete the Ozone Layer, including CFCs, Halons, Halogenated CFCs, methyl tetrachloride,

methyl chloroform, HCFCs, HBFCs, methyl bromide, bromochloromethane, hydrofluorocarbons.

Scope 2 emissions include energy consumed for electricity and district heating, where emission conversion factors are calculated using the United States Environmental Protection Agency (US EPA) eGRID emission values, or for facilities outside the US, emission values from the International Energy Agency (IEA). Scope 2 location-based emissions are calculated based on average energy generation emission factors for defined locations, while scope 2 market-based emissions are calculated based on emissions calculated from specific energy purchase contracts, and therefore consider renewable energy purchase certificates.

Scope 3 emissions include 1st leg distribution emissions, which are emissions arising from intra-company shipments and shipments from ALK product supply sites to ALK commercial fulfilment centers/warehouses. These emissions are calculated using the GHG Protocol scope 3 screening tool, which uses a spend-based methodology, with the values for December estimated based on average monthly spend over the year. Emission conversion factors are calculated using IEA tank-to-wheel emission (TTW) values. The wheel-to-tank (WTT) emissions in % compared to the TTW emissions for various liquid fuels are calculated based on the DEFRA 2022 emissions factors. Since the third-party transportation and business travel represent a diverse mix of transportation modes and fuel types, the average calculated is considered to

be representative. Scope 3 also includes travel flight emissions which are reported using a WTT CO2 report provided by AMEX for all ALK business travel flights in 2022, except in China where flight emissions are estimated using a spend-based method and the GHG Protocol scope 3 screening tool for January-October, and actual emission values for November-December. TTW flight emission values are calculated using IEA values. Travel flight emissions for 2019-2021 do not include flights from China.

GHG intensity and CO2 reduction are calculated using scope 1, scope 2 market-based and scope 3 emissions. CO2 reduction is compared to a 2019 baseline considering scope 1, scope 2 locationbased and scope 3 emissions.

Energy

Energy consumption is calculated based on meter readings and/or invoices of all energy types at production sites.

Water

Water consumption is measured by meter readings and/or invoices in all production sites.

Waste

Waste is estimated in some sites where waste cannot be directly weighed. The types of materials present in the waste include paper, electronics, medical waste, wood, metal, general solid bio-waste, oil, and chemical waste.

People

Health & safety

Work-related incidents are defined as occurrences arising out of or in the course of work that result in injury or fatality. Injuries that occur when working from home are work related if the injury occurs while the worker is performing work from home, and the injury is directly related to the performance of work rather than the general home environment or setting. Incident cases are reported to our EHS department and include the number of incidents as well as important background details related to the incidents.

Work related accidents are defined as workrelated incidents resulting in an individual being physically or mentally unable to work, as diagnosed by a competent medical professional. The rate of work-related accidents, expressed as lost time injury frequency (LTIF) is determined by dividing the number of accidents by the total hours worked, multiplied by 1,000,000 to give number of cases per one million hours worked.

Absence due to illness is calculated as number of total working days with absence due to any illness, work related or otherwise, divided by total working days.

Engagement

Participation rate and engagement score are collected from a survey conducted by a third party.

Workforce Demographics

All employee-related data is downloaded from our internal HR-system, Workday, and is relevant as of 31 December 2022. All figures consider active (permanent and temporary) employees. Non-guaranteed hour employees, and employees outside our own workforce are not included. Temporary employment is defined as employment with a pre-agreed end-date.

Workforce headcount is broken down for countries with more than 50 employees. The employee turnover ratio is calculated by dividing the number of employees who left the company by the average number of employees in the reporting year.

The gender diversity figures from 2021 and earlier do not include Germany, as job grades were not yet approved by the works council in that region.

The CEO annual compensation ratio is determined by the annual total compensation of the CEO against the median annual total compensation for all active ( permanent and temporary) employees, excluding the CEO. Annual total compensation includes salary, bonus, allowances, pension and all one-time payments over the course of a year.

Responsible Business Practices

Business ethics

Alertline cases are taken from our external system, Ethics Point. Cases related to discrimination are defined as ´discrimination on the grounds of an individual’s uniqueness such as perspectives, work and life experiences, age, gender, race, ethnicity, religion, sexual orientation, ability, or any

other characteristics´. Discrimination concerns can be raised through several channels such as our whistle-blower hotline, alertline, or through Employee Representative Groups, HR, EHS and Legal.

When reporting on bribery, bribes can take the form of money, gifts, loans, fees, hospitality, services, discounts, the award of a contract or any other advantage or benefit, and it comprises any financial or other inducement or reward for an action which is illegal, unethical, a breach of trust or improper in any way. When reporting on corruption, this is defined as ´abuse of entrusted power by someone for personal gain´.

Governance

Board diversity is measured by the percentage of female non-executive members.

Board independence is measured by the percent of independent, non-executive members.

The Board Meeting Attendance rate is calculated as (number of meetings*number of members)-meetings not attended/(number of meetings*number of members)*100.

Code of Conduct training is calculated by the percentage of employees completing the training based on internal registrations.

Disclosure requirements, cf. §99a, 99b, 99d and 107d of the Danish Financial Statements Act Disclosure requirements See page 99a

Report references

In this list you can find all link references in the report.

Introduction Page 03

ALK 2022 Annual report: https://ir.alk.net/financial-reporting

ALK website: https://alk.net

ALK LinkedIn: https://www.linkedin.com/company/alk-abello

ALK Twitter: https://twitter.com/ALK_net

Access to Allergy Care

Page 08

1. Brozek J et al. Allergic Rhinitis and its Impact on Asthma (ARIA) guidelines: 2010 Revision. J ALLERGY CLIN IMMUNOL VOLUME 126, NUMBER 3.

2. D'Amato G, Annesi-Maesano, I, D’Amato, M, Outdoor Allergens, Pollens and Molds and Their Relationship to Climate Changes. Encyclopedia of Respiratory Medicine (Second Edition), 2022; 410-417.

3. Zhang Y, Steiner AL, Pollen season is getting longer and more intense with climate change –here’s what allergy sufferers can expect in the future, 2022:https://theconversation.com/pollenseason-is-getting-longer-and-more-intense-withclimate-change-heres-what-allergy-suffererscan-expect-in-the-future-179158

4. Bousquet J, Burney PG, Zuberbier T et al.

GA2LEN (Global Allergy and Asthma European Network) Addresses the Allergy and Asthma Epidemic. National Library of Medicine, 2009; 64: 969–977

Page 10

ALK Access to Medicine Policy: https://www.alk.net/sustainability

ALK's solutions to the treatment of allergy: https://www.alk.net/our-solutions

People Page 15

Composition of the Board of Directors, its members, and their competences: https://ir.alk.net/corporate-governance/ board-of-directors.

ALK Code of Conduct: https://www.alk.net/sustainability

ALK Diversity and Inclusion Policy: https://www.alk.net/sustainability

Environment and Climate

Page 20

ALK Code of Conduct: https://www.alk.net/sustainability

ALK Environment, Health and Safety Policy: https://www.alk.net/sustainability

Responsible business practices

Page 24

ALK Anti-Corruption Policy: https://www.alk.net/sustainability

ALK Code of Conduct: https://www.alk.net/sustainability

ALK Data Ethics Policy: https://www.alk.net/sustainability

ALK Third Party Code of Conduct: https://www.alk.net/sustainability

ALK Stakeholder & Communications Policy: https://ir.alk.net/corporate-governance

ALK Tax Policy: https://www.alk.net/tax-policy

ALK Whistleblowing Policy: https://www.alk.net/sustainability

ALK 2022 UK Modern Slavery Act statement: https://www.alk.net/sustainability

Contact the external Alertline: https://secure.ethicspoint.eu/domain/media/en/ gui/33411/index.html

Our

purpose Advance sustainable healthcare to meet people’s changing needs

In an ever-changing world, people’s needs and expectations for health and safety continue to progress. The reason is simple; people’s fundamental desire to live in the best conditions of health and safety remains strong and unchanged.

Through our varied offers of healthcare and emergency health and safety services, we have made it our responsibility to help even more people around the world live healthy lives.

Strategy

The underlying rationale behind the Care for more ’25 corporate strategy is to help even more people wake up in the morning and live a healthy life.

Sustainability

We have progressed in 2022 by delivering more services, reducing carbon emissions from our fleet and committing to the Science Based Targets initiative.

more on page 31

Falck at a glance

Falck is a global healthcare provider with a wide range of service offerings within emergency services and healthcare. Our services within prevention, treatment and rehabilitation are delivered on long-term contracts, subscriptions and pay-by-use.

1906

Founded

8.9 million Services in 2022

12,647

Revenue DKKm in 2022

~25,000

Highly skilled professionals

26 Countries

Countries with Falck employees

California

Falck Ambulance US operates mainly in California

Core business

Emergency Health and Safety Healthcare

Ambulance services

Denmark, Germany, Spain, Sweden and the US

Fire services

Belgium, Brazil, Denmark, France, Germany, Italy, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Spain, Sweden and the UK

Employee and Labour Market services

Denmark, Norway and Sweden

Consumer and Technical services

Denmark

Community Health services

Colombia, Ecuador, El Salvador, Panama and Uruguay

Portfolio

Patient transport and ambulance services

Poland, Australia and Slovakia

Global travel assistance

Finland, India, Norway, Sweden, Spain, Denmark, Turkey, Thailand and the US

Financial highlights Falck operates three business areas; Emergency 5 Falck Annual Report 2022 Management’s review In brief

12,647

Public

Public

Letter from the Chair and the CEO

Strategy and core business momentum

2022 was a solid year for Falck. We achieved broadbased organic growth, delivered more healthcare services, prepared Falck for major investments in digitalisation and reduced our climate footprint slightly.

At Falck, we are led by our purpose to advance sustainable healthcare to meet people's changing needs. Essentially, we want to help even more people live a healthy life. This contribution is made on a daily basis by delivering our core services within prevention, treatment and rehabilitation.

We did exactly that on almost 9 million occasions in 2022. This was an increase over the previous year, and it shows that we have achieved a wider reach.

At Falck we strive to be the best possible partner for the healthcare systems we work with. In all markets, where Falck is present, the growing demand for healthcare services, and the limitations to continuously expand capacity and recruit healthcare professionals calls for both reforms and radical innovation to make ends meet. We want to increase our contribution to solving those societal challenges, through long-term partnerships.

Our fundamental approach to achieving our purpose and societal commitments is to develop and operate a strong core business. Thus, by working commercially, we seek to

generate organic revenue growth, the cash flows and the operating profit needed to allow for funding of ongoing investments in digitalisation, sustainability, innovation, global practices, workplace development, training, and more.

In this way, we amplify our capacity to address healthcare challenges with relevant, quality services delivered efficiently and in the most sustainable way possible. This is the foundation from which we can act and contribute as an attractive, long-term partner to the healthcare systems in key markets.

Our core business, financial foundation and sustainability record have all grown stronger compared to last year. This makes us optimistic about Falck’s long-term strategy and ability to continue in its development and growth trajectory – and importantly, our societal contribution.

Solid, broad-based organic growth

For the full year, Group revenue amounted to DKK 12,647 million (DKK 15,173 million) and EBITA landed at DKK 717 million (DKK 1,834 million).

When evaluating the financial performance of Falck’s on-going business, it is relevant to exclude the financial contribution from the public testing activities performed for the Danish regions in 2020, 2021 and until the contract expired in March 2022. The reason is simple; those testing activities were extraordinary, comprehensive and temporary.

Excluding public testing activities, Falck generated revenue of DKK 12,030 million (DKK 11,717 million) and posted EBITA of DKK 517 million (DKK 605 million) in 2022. The free cash flow after tax amounted to negative DKK 18 million (DKK 578 million), mainly caused by postponed Group VAT payments and the timing of the annual prepayments of public fire and ambulance contracts in Denmark.

The organic revenue growth rate was 5.7%. It was particularly encouraging to see that the organic revenue growth was broad-based, being supported by all business areas and apparent in all main markets – Europe, the US and Latin America.

Revenue growth was driven by increased contract volumes in our ambulance and fire

Key events of the year

services. Likewise, the inflow of new healthcare subscription customers also contributed, and we provided more pay-on-use healthcare services than last year.

While revenue increased from last year, EBITA landed somewhat lower. This was due to higher costs resulting from staff shortages and surging energy prices, which we are still working to mitigate through a variety of measures. Given the challenging market conditions, we consider the financial performance to be satisfactory.

Investing in future healthcare solutions

In 2022, we started an investment programme to ensure that Falck is ready to meet both the present as well as future demands for new healthcare solutions.

With this, we have prepared Falck as an organisation to embark on a significant investment programme which will further increase in 2023 to a level of DKK 250 million. This will constitute a strong acceleration on the usage of digitalisation across our operations and healthcare services to meet the increasing needs of people and society. We are fully aware that the work will push the Falck

organisation and will have to be undertaken in close collaboration with our customers. But we are certain that the investments will benefit our customers, contribute to the societies we operate in, as well as develop Falck as a highly attractive workplace for our current and future employees.

Divestment programme almost completed

To focus the Falck business, we have pursued substantial divestments over the past few years.

In March 2022, we successfully divested the Roadside Assistance business in Sweden, Norway, Finland, Estonia and Lithuania – a major milestone, which gave Falck a transaction gain of DKK 708 million. Later in the year, we divested our UK ambulance operations.

Altogether, we have executed on the planned, multi-year divestment programme – and it is now close to completion.

Enhanced sustainability

We accelerated our sustainability efforts in 2022 and achieved progress. Scope 1 carbon emissions from our fleet decreased slightly, to 52,325 tonnes from 53,194 tonnes last year. The

Lost Time Injury rate (LTIR) improved and the whistle-blower reporting ratio was maintained above the desired threshold. We have made a commitment to the Science Based Targets initiative and consequently broadened our CO2 reduction ambitions to cover the entire value chain. We continue the work to submit our target no later than 2024.

We are pleased to publish this year’s sustainability reporting as part of the Annual Report. Doing so is a natural next step for us, as sustainability is already an integral part of our business strategy and performance.

Lastly, we wish to thank all Falck employees for their continued commitment to building Falck’s business and making a difference to health and safety. We also wish to thank our partners, customers, investors and all other stakeholders for their trust.

Niels Smedegaard appointed new Chair of Falck

Closing of antigen testing centres in Denmark

Divestment of Roadside Assistance in Sweden, Norway, Finland, Estonia, and Lithuania finalised

Falck donated 30 ambulances for use in Ukraine, Moldova and Poland

Previa started using the Falck brand

The revitalised Falck museum at Egeskov Castle opened Falck kick-started transition to a green fleet

Falck started the testing of drones in Greenland

Frisk Gruppen rebranded to Falck

Christian Baltzer appointed new Group CFO of Falck

Falck acquired all shares in Fire entities in Spain, France, Italy and Brazil

New Employee Health Services product launched in Denmark

Falck divested Falck UK Ambulance Services Limited

Falck committed to the Science Based Targets initiative (SBTi)

Niels Smedegaard Chair of the Board of Directors

Jakob Riis President and CEO

Five-year summary

1) EBITA is defined as operating profit before special items, amortisation of customer contracts and brand, impairment of goodwill and gains/ losses from divestments of enterprises.

2) For 2017-2020, the leverage is excluding the impact of IFRS 16 implementation.

3) For 2021, the leverage includes full-year impact from Frisk Gruppen.

Comments

See definitions of key figures and ratios in note 1.4 of the consolidated financial statements.

Outlook 2023

The macroeconomic outlook is characterised by increased uncertainty on a range of factors and a diminishing global economic growth. IMF projects global economic growth around 2.7%, with significant variations across markets. This is the lowest projection in several years.

On the demand side, Falck’s business model is relatively resilient to macroeconomic variations due to the nature of Falck’s services, particularly in the Emergency Health and Service business area, whereas the Healthcare business is relatively more exposed to variations in public and private sector budgets.

On the cost side, high inflation levels on both energy and supplies have impacted the results in 2022 and are expected to also impact cost levels in 2023. In addition, an increasing pressure on salaries is expected in 2023, the level of which is subject to a high degree of uncertainty.

Staff shortage will remain a challenge also in 2023, mainly within the Ambulance operations in the US and Europe. Since late 2021, Falck has addressed this challenge through increased focus on recruitment, training, and retention of frontline staff. In addition, Falck has engaging in dialogues with the contractual counterparties on routes to address both the root cause of the staff shortage but also to agree on resolutions to limit the financial impact on Falck.

Finally, operational planning, continued efficiency improvements and proactive pricing have been, and will continue to be, important levers to absorb and limit the negative financial impact on Falck.

The outlook for 2023 is based on foreign exchange rates as of end-December 2022. Significant changes in key foreign exchange rates, mainly USD, SEK, and NOK, may have a notable impact on revenue. In terms of earnings, due to the nature of Falck’s operations, most costs are denominated in the same currency as the revenue and therefore, the net impact from foreign exchange effects is limited.

The outlook is also based on all current business activities including the remaining business units in the Portfolio segment. Depending on the timing of a potential divestment of these remaining activities, this may have a negative impact mainly on expected revenue in 2023, whereas the impact on EBITA will be limited.

Revenue

Falck expects revenue of DKK 11.5 billion to DKK 12.0 billion in 2023. This is based on organic growth expectations for the Healthcare business driven by a combination of continued subscription portfolio growth, higher pay-on-use activity, and price increases. In Emergency Health and Safety, a flat organic

growth is expected as increased pay-on-use activity and price increases compensate for reduced contract volume.

EBITA

Falck expects EBITA of DKK 300 million to DKK 450 million in 2023. This includes significantly increased investments in IT development costs. Since 2021, Falck has executed its Care for more ‘25 strategy, which has resulted in increased costs related to investments in digitalisation, global operating models and rebranding. In 2023, investments in digitalisation and business development to support the strategy towards 2025 and beyond will increase to approximately DKK 250 million that are all expected to impact EBITA and are not assumed to be capitalised. As a reference point, in 2022, Falck invested approximately DKK 90 million in costs related to global rebranding and other strategic initiatives to support the execution of Falck’s strategy.

In Emergency Health and Safety, profitability is expected to be impacted by elevated fuel prices and an increasing inflationary pressure on salaries. The negative impact from staff shortages, however, is expected to decrease compared to 2022 due to the efforts described above. In the Healthcare segment, profitability is expected to improve, driven by continuous improvement of utilisation, proactive pricing and contract management.

02 Strategy

The corporate strategy – Care for more ’25 – was launched in 2021. It is the foundation on which Falck plans to develop into a leading, global provider of integrated healthcare services and help even more people wake up in the morning and live a healthy life. Solid progress was made on the strategy.

Business model

Resources

People

Our services are delivered by 25,000 engaged and skilled employees

Equipment

We use high-quality equipment enabling effective diagnostics and resolution

Partnerships

We enter local partnerships to customise our global services to local needs

Innovation

We utilise new technology and explore smarter, new and transformational ways of working

Brand and reputation

We benefit from a strong brand and a solid reputation for being effective, reliable and caring in everything we do

Capabilities

Strong

Integrated healthcare services

Ambulance services

Fire rescue services

Patient transportation

Healthcare services

Excellent

Advance healthcare

Value created Deep

We save and improve lives every day. We advance sustainable healthcare to meet people’s changing needs

Customer value

We support healthy workplaces, offering prevention, treatment and rehabilitation of their employees and protect property and valuables

Supporting societies

We support national healthcare systems with emergency response and healthcare services while reducing our climate impact

(i.e. doctor-on-call, psychological consultation, chiropractor, and physiotherapist support)

First

Roadside assistance

Labour market services

Societal

A great place to work

We offer challenging and purposeful work with opportunities for personal and professional development

Shareholder value

We deliver value to our shareholders

Prevention Treatment Rehabilitation

Solid progress on Care for more ’25

The underlying rationale behind the Care for more ’25 corporate strategy is to help even more people wake up in the morning and live a healthy life. This is important to our purpose.

In many households, families, communities and workplaces around the world, you will find people, who at some point in their life – yesterday, a month ago or several years back – were saved, have recovered or learned to live a healthier life with the help of a Falck employee. At Falck, making contributions like that reminds us of our purpose and it gives us a sense of pride and inspiration.

The ambition is to do this for even more people, in more situations, and to accommodate people’s changing lifetime circumstances even more. At the same time, we want to significantly reduce our climate impact on this journey.

This way of thinking coincides with our purpose, focused on advancing sustainable healthcare to meet people’s changing needs, and it is on this foundation that the corporate strategy, Care for more ’25, was established.

Growing need for integrated healthcare solutions

We see immense healthcare challenges and opportunities in modern societies today. It is our ambition to be part of the solutions to protect, restore and improve people’s health and lives.

It is widely recognised that ageing populations increase the need for more care and the delivery of a much wider range of healthcare solutions. The needs of people at an advanced age are increasingly multifaceted with more multi-chronic conditions, for example. This demographic development is already causing mounting pressure on public healthcare systems, and healthcare costs continue to rise.

At the same time, there are growing demands from other groups in society. People in their working lives need quick and easy access to healthcare to reduce the number of years lost because of injuries or deteriorated health conditions. It is also evident that people today take stronger ownership of their health and demand more.

Other healthcare trends

Alongside these trends, mental health sufferings have increased substantially following COVID-19 and obesity has been increasing in recent decades, according to the OECD. Following the outbreaks of COVID-19 in 2020, policymakers around the world were reminded of the constant risk of global pandemics.

According to the World Health Organization (WHO), an agency of the United Nations, the largest health threat globally is arising from climate change. In the coming decades, we should expect increasingly negative implications from heat-induced heart attacks and more will be exposed to very high or extremely high fire danger, mentioned as examples only.

Call for efficient, flexible healthcare

The above are some – but not an exhaustive listing – of the main healthcare challenges already present and growing in the different healthcare systems in Europe, the US and Latin America, where we operate.

The responses are not easily provided. There are limitations to the funding and capacity of public healthcare systems. Further, there is a notable shortage of healthcare professionals to meet the needs at hand, and this situation is likely to prevail for many years ahead. Given these challenges, it remains a considerable public and political concern to address unfair inequalities in the access to healthcare services.

We want to support societies at large with these challenges and supplement healthcare systems by delivering healthcare solutions in highly efficient, flexible and holistic ways.

It is within this dynamic, commercial space that Falck will innovate and develop relevant offerings that target the customer spectrum ranging from private consumers to governments with a full scale public healthcare system, for example through public-private partnerships.

We want to contribute to innovating new solutions and to execute on them as a flexible and efficient subcontractor to public healthcare systems. By the same token, we want to cater to the increasing needs of private

consumers, corporates and others by providing healthcare services that supplement public healthcare systems.

In view of this, we see a large, attractive and strongly growing market for integrated healthcare solutions to be provided in Falck’s current regions of operation: Europe, the US and Latin America.

Falck’s advantage in meeting customer needs

As a company, Falck stands out by its long track record and established expertise in supplying healthcare services that cater to a variety of needs within prevention, treatment and rehabilitation. We serve a wide spectrum of customer segments, across borders and in an increasingly sustainable way.

From this starting point, we want to continue to stand out as an attractive partner in solving healthcare needs in selected core markets towards a wide range of customer segments; private consumers (B2C), corporations (B2B), insurance and pension companies (B2I) as well as public-sector authorities (B2G).

For private consumers, corporations, insurance and pension companies, we will continue to grow our services. This will include prevention and treatment of critical health situations involving physical or mental suffering, and additional support combined with related rehabilitation. Often, we supply fast, flexible and easy access to healthcare specialists and help our customers to navigate the healthcare system. These services are supplied either as part of healthcare subscriptions or as pay-on-use.

For corporations, providing such healthcare services from Falck to their employees helps them to enhance motivation and engagement as well as fulfil their social responsibilities too.

Falck works with a holistic view on sustainable healthcare across prevention, treatment and rehabilitation

Prevention Treatment Rehabilitation

We support long-term changes to improve people’s well-being and reduce the resources needed for treatment.

Examples

• First-aid courses and kits

• Fire prevention services

• Training and ergonomic advice

We deliver quick diagnoses and flexible treatment on physical or psychological sufferings.

Examples

• Critical ambulance and fire emergency

• Access to doctors, nurses, physiotherapists, psychologists and other healthcare professionals

• Homecare services

We help on rehabilitation, ensuring efficient recovery from physical or psychological sufferings rooted in workor life-related situations.

Examples

• Labour market services

• Advice and training

For public-sector customers, such as municipal, regional and state authorities, we will continuously expand our ability to support public healthcare systems directly. This will be as a preferred partner for the provision of treatment, such as ambulance and fire emergency services, and within rehabilitation through labour market services.

We also want to remain an available partner with the capacity to quickly mobilise and supply flexible resources to help public authorities manage sudden shifts in needs. This was recently done with the management of COVID-19 testing activities in Denmark.

We see immense healthcare challenges and opportunities in modern societies today. It is our ambition to be part of the solutions to protect, restore and improve people's health and lives.

Key elements of our strategy

It is our long-term strategic objective to become a leading, global provider of integrated healthcare services. To keep focus and progress, Care for more ’25 guides our daily decisions, actions and priorities towards 2025.

Our corporate strategy is focused on fostering the continuous development and growth of the core business, which is organisationally located in two main business areas. This is to be done with the emphasis on unfolding four break-through themes that are shared across businesses and markets.

In the core business, we focus on building global operating models. With that we want to ultimately scale high-quality, knowledgebased operations and working practices across markets. This should likewise foster an even greater level of operational efficiency.

On the same terms, it is a strategic focus to continuously integrate sustainability deeply into our business practices and decision-making. Therefore, we have established ambitious sustainability targets across our business and governance. Recently, we committed to the Science Based Targets initiative (SBTi). Our initiatives within sustainability support the implementation of our business strategy.

Execution on track

Since the launch of the Care for more '25 strategy in early 2021, each business area has made tactical plans to support Falck in becoming an integrated healthcare services provider.

Building healthcare market presence

We want to significantly improve our presence and ability to help people directly with their healthcare needs in the Scandinavian countries. This led to the acquisition of Frisk Gruppen, a leading Norwegian healthcare provider, in 2021.

That move gave us access to a strong infrastructure in terms of a sizeable physical presence in Norway. Along with the presence already established in Denmark and Sweden, it meant that Falck had a de facto presence with offices dispersed across all three countries, becoming the largest healthcare provider in Scandinavia in the process.

Other landmarks

In Denmark, we made considerable improvements in 2022 to the features and digital interface of our healthcare subscription packages we provide to private consumers and smaller businesses. The experience gained from this exercise could potentially be scaled up and applied in other countries at some point.

The development of Falck’s global ambulance model was another strategic landmark achieved in 2022. It enabled us to establish a clear roadmap on how to align our ambulance services even further on a global scale, characterised by high quality and efficiency.

Rebranding of business units

In the latter part of 2022, Falck undertook a rebranding process of business units and subbrands with names other than Falck in Scandinavian and Latin America.

Following the rebranding of Frisk Gruppen in Norway and Previa in Sweden, Falck now holds a clear brand for employee health solutions in Denmark, Sweden and Norway.

Successful divestments

Alongside the building of Falck’s core business with Care for more ’25, we have extensively divested activities and business units which are not considered part of the core business.

In March 2022, Falck completed the sale of the Roadside Assistance business in Sweden,

• Alignment of Falck brand across Scandinavia and the US

• Implementation of structured customer relations management (CRM) and win plans in contract business

• More data-driven B2C and B2B customer insights and decisions

• Subscription base in Colombia for doctor-on-call services increased by approximately 23,000 subscribers in 2022

Norway, Finland, Estonia and Lithuania. The transaction resulted in a gain of DKK 708 million. This transaction constituted another major milestone for the multi-year divestment programme, which thereby came very close to full completion.

Another divestment was effected in October 2022, when Ambulanz by DocGo acquired Falck UK Ambulance Services Limited. business (excluding testing activities).

The divestments in recent years have resulted in the transfer of businesses to better owners

Unleash Falck’s full commercial potential

In the second half of 2022, we started a project to explore the strategic opportunities available to further enhance the implementation of Care for more ’25 and unleash Falck’s full commercial potential towards 2027.

• Falck Ambulance Model (operating model) developed and being rolled out

• Scandinavian Healthcare operating model defined and being rolled out (Employee and Labour Market services)

• Defining and implementing frontline employee journeys and value propositions

• Expansion of the range of service offerings to various customer segments in Latin America

• initial pilots of drones for transporting medical samples and supplies, as well as for search and rescue

• Pilot with a Danish region on addressing mental traumas suffered by emergency bystanders

• New service offering in Employee and Labour Market services (Sundhedshjælp Business) focusing on employee well-being

and a more focused Falck. Strong proceeds from these sales have supported the development of the core business, reduced debt and rewarded owners with dividend payments.

We plan to continue the current process of developing the core business within integrated healthcare solutions. This will be done by capturing market opportunities, leveraging Falck’s market position as a recognised high-quality supplier, and further creating knowledge-based synergies across markets and business units.

• Digitalisation of healthcare customer journeys

• Digitalisation and alignment of financial data processes and flows

• Streamlining master data setup, governance and flows

By the end of 2022, we decided to recategorise Falck Global Assistance as part of our core business. Thus, effective from 1 January 2023, the business unit will be organisationally transferred out of Portfolio. In recent years, Falck Global Assistance has improved its business model, growth trajectory and value proposition to B2B customers in Scandinavia with Duty of Care solutions to support business travelling.

The multi-year divestment programme of non-core activities came close to full completion.

Business area strategies

Emergency Health and Safety

The business area Emergency Health and Safety provides ambulance and fire services in Europe and the US. We want to grow organically in existing markets by standing out as a preferred partner to our customers.

In Emergency Health and Safety, we operate ambulance emergency services through the business units Ambulance Europe and Ambulance US. The Fire services business mainly has a presence in Europe, but it also has an operation in Brazil.

Developing the ambulance business globally

The ambulance emergency businesses in Europe and the US provide treatments for public-sector customers (B2G) such as municipal and local regional authorities with a need or preference for outsourcing emergency ambulance services.

We want to organically expand the market position in five core markets: Denmark, Germany, Spain, Sweden and the US. We operate in these markets as they are the ones most open to private operators and are all considered to be attractive markets.

Falck stands out on high quality standards, and one approach to this is through the Falck Ambulance Model, which enables working practices developed in one country to be shared and used to our competitive advantage in other markets.

Streamlining commercial activities in Fire services

The Fire services business in Europe provides prevention services to corporates (B2B) and fire-fighting services to both corporates (B2B) and public-sector customers (B2G). The business serves a variety of corporate customers in Europe, primarily airports, petrochemical sites, power generating plants and manufacturing plants.

We will grow organically in existing markets by strengthening commercial activities and pipeline management.

Further, the aim is to improve profitability by building scale and sharing specialist knowledge and best practices within selected industries across the European markets. This includes ways to reduce any adverse climate impacts from our services.

Streamlined on-duty planning in the US ambulance business

“Send two ambulances – a boy about 8 years old and his mom have suffered severe burns in a kitchen accident”. A moment ago, the dispatch had sent four ambulances to a traffic accident. As you can see from this illustrative story, it is overly critical for an ambulance operation to always be correctly staffed.

On-duty planning requires considerable time and is quite complex to manage. Some ambulance operations have several customer contracts and trade union agreements to abide by – and trained paramedics are a scarce resource.

For an efficient ambulance operation, it is critical for an operational on-duty planning to always ensure the right number of healthcare professionals are on duty. It is also essential to have the right mix of specialist skills available.

In 2022, an internal task force at Falck mapped the best working tools and procedures used for on-duty planning in the different markets. Building on these insights, Falck developed a global end-to-end on-duty

planning practise with emphasis on proactive planning, including forecasting the related needs, use of relevant financial inputs and collaboration with frontline staff.

The global practice for on-duty planning is now part of the overall Falck Ambulance Model.

Global planning practise works in the US

Once the development phase had been completed, Falck’s next step was to implement the global on-duty planning practise throughout the US ambulance business.

Planning was previously done locally in Alameda, Los Angeles/Orange County and San Diego and in different ways. After the change, planning for all US operations is now

anchored in Orange County, ensuring that Falck utilises insights and best practices across the US operations.

Through the continuous rollout of these global practices, Falck expects to improve its resource utilisation, reduce operating costs and, not least, to increase employee satisfaction.

The initial improvements have already emerged, and over the coming years Falck plans to stepwise roll out global practises for on-duty planning as well as for the other key areas of the ambulance business in Europe and the US.

The story ended with the boy and his mom both being brought to hospital quickly and safely – and they both recovered fully.

Global operating model for ambulance service

Business area strategies

The Healthcare business area provides a strong offering of healthcare services to private consumers, corporates, insurance companies and pension funds as a supplement to what public healthcare systems offer.

In addition, the business area provides labour market services mainly to public-sector authorities. Primarily, we want to grow organically in existing markets and to fully leverage on the Scandinavian footprint from the acquisition of Frisk Gruppen in 2021.

We operate the Healthcare business area in Scandinavia through the two business units: Employee and Labour Market services, and Consumer and Technical services. Further, the business unit Community Health services operates in Latin America.

Employee and Labour Market services with full Scandinavian coverage

The business unit Employee and Labour Market services provides employee services to corporates (B2B) as well as insurance companies and pension funds (B2I). Labour market services are typically sourced by public-sector organisations (B2G), as they are related to rehabilitation support services provided in the public unemployment activation system.

Our long-term ambition in Scandinavia is to gain market presence within healthcare solutions.

We are therefore working towards building a solid Scandinavian market presence within both employee and labour market services, including implementing a common operating model.

Consumer and Technical services to further expand consumer healthcare

The business unit Consumer and Technical services provides a broad offering of healthcare-related services such as healthcare package subscriptions, patient transport, personal health, first aid courses and kits as well as fire prevention. The broad customer base for those services consists of private consumers (B2C) and small businesses (B2B). The business unit operates in Denmark only.

In addition, the business unit delivers roadside assistance to insurance companies (B2I) and assists public-sector customers in clearing roads in various situations.

We want to continuously increase the number of subscribers and the sale of pay-on-use services in Denmark, while simultaneously supporting and protecting the well-performing businesses, such as roadside assistance, private patient transport, first-aid courses and fire prevention.

Community Health services to continue to grow by expanding customer segments

The business unit Community Health services provides treatment to private consumers (B2C), corporate customers (B2B) as well as pension funds and insurance companies (B2I) with “doctorson-call” services in Latin America, primarily Colombia.

We will increase the subscriber base and strengthen our market leadership in Colombia.

Further, we want to improve our presence in other countries of Latin America where we are already present - Ecuador, El Salvador, Panama and Uruguay - by continuously developing our service offering and improving the customer experience. This will include opening up for sales to additional customer segments in these markets.

Frisk Gruppen integration

Building a strong healthcare business across Scandinavia

It can be a challenge for private and public corporations in the Scandinavian countries to acquire full-coverage healthcare solutions for their employees from a single supplier. Falck has a strategy to meet the growing demand among corporates for such services, and the acquisition and integration of Frisk Gruppen is a cornerstone of this endeavour.

In October 2021, Falck acquired Frisk Gruppen, a Norwegian healthcare provider with a leading offering of employee and labour market services. Frisk Gruppen has a strong strategic fit with Falck’s existing business.

As a result, Falck welcomed more than 700 skilled employees and grew its business in Norway.

The acquisition solidified Falck’s leading position across Scandinavia, now with more than 1,500 healthcare professionals and a network of +10,000 healthcare specialists across 35 locations in Denmark, 98 locations in Sweden and 105 locations in Norway.

Into 2022 with a new organisation in place

Right from the start, the ambition was to execute full and swift integration of Frisk Gruppen along with all its subsidiaries; Aktimed Helse, Ringvoll BHT, Frisk Utvikling and Frisk Spesialist.

Shortly after the acquisition, a strong, new organisation was set up with effect from 1 January 2022. This included an organisational consolidation of Falck’s current teams in Norway with the teams from Frisk Gruppen.

Another aspect of the organisational integration was about aligning practices within areas such as sales, pricing and customer services. Frisk Gruppen transitioned to Falck’s global operating model, including the management of financial reporting, legal affairs, HR systems, IT and much more.

Building a strong culture

A key component of the integration process was to build a strong, common culture. Close to 100 managers from Frisk Gruppen and various Falck operations in Norway came together for an intense leadership training event focused on Falck’s Winning Behaviours and parts of the Dare2Care leadership programme. The event enabled team leaders to provide a 360-degree introduction to Falck for all employees of Frisk Gruppen.

These initiatives have been paramount for ensuring consent among Frisk Gruppen employees to becoming a part of Falck and shaped the commitment to overcome the changes that they would inevitably encounter. According to the engagement survey performed in the autumn of 2022, the vast majority of the employees of the former Frisk Gruppen were satisfied with working for Falck.

Unified Falck brand in Norway

By September 2022, a full rebranding of the entire Norwegian business had been completed and, as a result, Falck now stands as a unified healthcare provider in Norway. The ambition is to prepare the market for future growth and provide demanded services, covering everything from prevention to treatment and rehabilitation across Scandinavia. This should make it easier for corporations to provide their employees with a full range of healthcare solutions.

03 Performance

In 2022, we achieved broad-based organic growth of 5.7%, which was driven by all business areas and apparent in all main markets –Europe, the US and Latin America.

Financial results for the Group

The Falck Group delivered organic revenue growth of 5.7% in 2022. EBITA was impacted by higher fuel costs and non-recurring costs related to global rebranding and strategic initiatives to support the execution of Falck’s Care for more ‘25 strategy.

All numbers in the commentary relating to the components of EBITA and the cash flow are stated excluding the financial impact from the public testing activities.

Revenue increased by DKK 313 million to DKK 12,030 million based on organic growth of 5.7%, partly driven by increased contract volume in Emergency Health and Safety and partly by broad-based growth across the business units in Healthcare. The net impact from M&A activities was negative by 5.0 percentage points, whereas foreign exchange effects had a positive impact of 2.0 percentage points (mainly from USD). Consequently, reported growth was 2.7%.

Cost of services (OPEX) increased by DKK 366 million to DKK 9,570 million despite the positive impact from divestments and discontinued operations in Portfolio. Around two thirds of the increase was driven by the acquisition of Frisk Gruppen and by the San Diego contract. Higher fuel and energy prices contributed to the increase by approximately DKK 80 million, and staff shortages remained a challenge in Emergency Health and Safety also contributing to the increase in costs. Finally, foreign exchange effects also had a

negative impact on costs compared to last year.

The OPEX ratio increased by 1.0 percentage point to 79.6%. The increase was partly due to an elevated cost level in Emergency Health and Safety impacted by higher fuel costs and partly due to a lower margin in Healthcare as a result of lower utilisation of the cost base due to lower-than-expected activity levels in Employee and Labour Market services.

Sales and administrative expenses (SG&A) increased by DKK 42 million to DKK 2,011 million, mainly driven by non-recurring costs of DKK 90 million related to global rebranding and strategic initiatives to support the execution of Falck’s Care for more ‘25 strategy. This was partly offset by a one-off reversal of bad debt provisions in Ambulance US as well as net savings from divestments. The SG&A ratio decreased slightly to 16.7% (16.8%).

EBITA decreased by DKK 88 million to DKK 517 million impacted by the elevated cost level in Emergency Health and Safety and by global non-recurring costs for strategic initiatives to support the execution of Falck’s Care for more ‘25 strategy.

The EBITA margin decreased to 4.3% (5.2%), mainly due to the increased OPEX ratios in both Emergency Health and Safety and Healthcare but also due to increased costs related to investments to support Falck’s strategic direction.

Across all Falck’s businesses, the majority of all costs are denominated in the same currency as revenue. Consequently, the net exposure to foreign exchange effects on Falck’s earnings is limited. For 2022, the net positive impact on EBITA, compared to 2021, was approximately DKK 15 million.

Total revenue for the Group was DKK 12,647 million (DKK 15,173 million) and total EBITA was 717 million (DKK 1,834 million). The decrease is mainly explained by the public antigen testing contract with the Danish regions, which Falck carried out in 2021 and until the contract expired in March 2022.

Operating profit (EBIT) was DKK 1,121 million (DKK 1,634 million), positively impacted by gains from the divestment of businesses of DKK 689

million. EBIT was negatively impacted by special items of DKK 21 million and the amortisation of customer contracts, brand value and impairment of goodwill totaling DKK 264 million. Last year, EBIT was positively impacted by the significant contribution from testing activities.

Profit for the year was DKK 921 million (DKK 1,229 million). Net financial expenses increased to DKK 74 million (DKK 46 million) due to higher interest rates and lower foreign exchange gains.

Free cash flow after tax (excluding public testing activities) was an outflow of DKK 18 million (DKK 578 million), equal to a negative cash conversion rate of 3.5% (positive 95.5%). The cash flow was adversely affected by postponed VAT and other payments from Q4 2021 of approximately DKK 150 million, timing of annual prepayments from fire and ambulance customers of DKK 175 million and other net working capital changes of approximately DKK 200 million.

Net operating assets increased by DKK 245 million compared to last year and amounted to DKK 7,126 million. The increase was primarily driven by an increase in net working capital, partly owing to the above-mentioned timing of prepayments from the public fire and ambulance customers and partly to the San Diego contract now being fully operational. In addition, last year‘s net operating assets were low due to outstanding balances of deferred VAT and employee-related taxes.

Equity decreased to DKK 3,919 million compared to DKK 4,964 million at 31 December 2021. The decrease was driven by dividend payments of DKK 999 million in March and DKK 748 million in June and by purchase of treasury shares of DKK 46 million in June partly offset by earnings for the period.

Dividend

The Board of Directors will propose at the Annual General Meeting that an ordinary dividend of DKK 255 million, corresponding to a 2% increase compared to last year and a pay-out ratio of 63% when excluding gains on divestments and impairment of goodwill.

Net interest-bearing debt was DKK 3,208 million compared to DKK 1,918 million at 31 December 2021. The change was driven by total dividend payments of DKK 1,747 million in 2022 and changes in net working capital, partly offset by cash flows from operations and proceeds from the divestment of the Roadside Assistance business outside Denmark.

Economic profit1 was negative DKK 82 million (positive DKK 919 million), impacted by elevated costs in Emergency Health and Safety as well as global investments to support Falck’s strategic direction. Economic profit last year was positively impacted by the significant earnings from testing activities. Excluding testing activities, economic profit was negative DKK 238 million (negative DKK 40 million).

Emergency Health and Safety

EBITA was DKK 47 million lower than last year, impacted by:

• Higher fuel and energy costs of around DKK 60 million due to higher prices

• Reduction in contract volume in Ambulance Denmark partly offset by increased contract volume in Ambulance US

• A positive impact from one-off reversal of bad debt provision in the US

Healthcare

EBITA decreased by DKK 25 million driven by lower utilisation in Employee and Labour Market services, higher energy and supplies costs and investments in SG&A to strengthen commercial and digital capabilities.

Group costs and eliminations

Group costs decreased by DKK 12 million despite non-recurring costs related to global rebranding and strategic initiatives to support the execution of Falck's Care for more '25 strategy.

Portfolio

EBITA was DKK 28 million lower than last year due to:

• A negative impact from divestment of businesses of DKK 115 million

• A positive impact from higher activity in Falck Global Assistance and efficiency improvements in other businesses

Development in EBITA from 2021 to 2022 (EBITA, DKK million, excluding testing activities)

Emergency Health and Safety

Revenue increased driven by higher contract volumes and pay-on-use activities. EBITA was negatively impacted by increased fuel and energy costs.

All numbers in the commentary relating to the components of EBITA and the cash flow are stated excluding the financial impact from the public testing activities.

Revenue increased by DKK 602 million to DKK 7,125 million, corresponding to reported growth of 9.2%, supported by foreign exchange

effects. Adjusted for foreign exchange effects, the organic growth rate was 5.9%.

Organic growth was mainly driven by the addition of the San Diego contract, contributing DKK 508 million, which more than outweighed the reduction of the contract volume in Ambulance Denmark. In

Key highlights 2022

Ambulance services is divided into Ambulance Europe and Ambulance US which provide emergency medical services and patient transport services to citizens in the US and a number of European countries.

9,003 FTEs

Fire services provides services to industrial customers across several European markets as well as to municipalities in Denmark.

2,506 FTEs

addition, a net increase in contract volume in other ambulance and fire operations as well as price increases also contributed to revenue growth. Staff shortages remained a challenge for the ambulance operations, especially in Denmark and the US, and had a negative effect on Falck’s ability to accommodate demand for its services. Staff shortages were less of an issue in the Fire business.

Cost of services (OPEX) increased by DKK 660 million, of which the San Diego contract accounted for DKK 419 million, which more than outweighed the reduction in costs associated with lower contract volumes in Ambulance Denmark. In addition, elevated fuel and energy costs contributed approximately DKK 60 million to the increase in OPEX. Staff shortages remained a challenge and led to higher operational costs for overtime pay,

recruitment and retention as well as contract-related penalties. Finally, foreign exchange effects had a negative impact, mainly due to an increase in USD. The OPEX ratio increased by 2.2 percentage points to 86.4% (84.2%).

Sales and administrative expenses (SG&A) were in line with last year at DKK 710 million (DKK 711 million). In broad terms, savings in Ambulance Denmark and a one-off reversal of bad debt provisions in Ambulance US was offset by increased SG&A as a result of the San Diego contract being fully operational in 2022. As a result, the SG&A ratio decreased to 10.0% (10.9%).

EBITA decreased by DKK 47 million to DKK 285 million, reducing the EBITA margin by 1.1 percentage point to 4.0%. The decrease was

mainly driven by the reduction in contract volume in Ambulance Denmark, higher fuel and energy cost as well as staff shortages, partly offset by higher prices and contract volumes (including the San Diego contract).

Total revenue for Emergency Health and Safety was DKK 7,742 million (DKK 9,980 million) and total EBITA was DKK 485 million (DKK 1,561 million). The decrease is mainly explained by the public antigen testing contract with the Danish regions, which Falck carried out in 2021 and until the contract expired in March 2022.

Free cash flow before tax (excluding public testing activities) was an outflow of DKK 98 million (inflow of DKK 583 million) corresponding to a negative pre-tax cash conversion rate of 34.4% (positive 175.6%). The cash flow was negatively impacted by timing of annual

prepayments from the Danish public fire and ambulance customers, which led to a significant decrease in contract liabilities. In addition, postponed payment of fees and other liabilities in Ambulance US from Q4 2021 also had a negative impact on cash flow.

Significant revenue growth driven by increased pay-onuse activity, a larger subscription portfolio and the acquisition of Frisk Gruppen.

Revenue increased to DKK 4,173 million (DKK 3,591 million). Organic growth was 5.0%, driven by increases in pay-on-use activity and growth in the subscription portfolio. In addition, the inclusion of Frisk Gruppen contributed to growth by 10.7 percentage points, and foreign exchange effects had an impact of 0.5 percentage point. Consequently, reported growth was 16.2%.

In Employee and Labour Market services, organic revenue growth, excluding the impact from Frisk Gruppen, was driven by higher demand for services compared to last year, partly offset by the negative effect of foreign exchange effects from a lower exchange rate on SEK.

Key highlights 2022

Employee and Labour Market services provides occupational healthcare services, rehabilitation and treatments to private businesses, insurance companies, pension funds and public organisations.

1,942 FTEs

Consumer and Technical services has a broad offering of healthcare-related services such as patient transport, personal health, first aid courses and kits as well as roadside assistance and fire prevention, primarily to subscribers.

940 FTEs

Community Health services in Latin America provides “doctors on call” services to individual subscribers, insurance holders and companies.

3,491 FTEs

In Consumer and Technical services, organic revenue growth was driven by a combination of higher pay-on-use sales, price increases and growth in private healthcare subscriptions.

In Community Health services, organic revenue growth was driven by a solid increase in the number of subscriptions compared to last year and price increases carried out in early 2022. An increase in the number of pay-on-use services also contributed to the growth. Finally, revenue was positively impacted by foreign exchange effects due to a lower exchange rate on COP and USD in which services are paid.

Cost of services (OPEX) increased by DKK 528 million to DKK 2,902 million, of which the inclusion of Frisk Gruppen accounted for DKK 325 million. The rest was mainly driven by higher activity levels across all three business units as well as higher energy, utility and supplies costs. The increased costs contributed

to increasing the OPEX ratio by 3.5 percentage points compared to last year at 69.6% (66.1%). The inclusion of Frisk Gruppen also contributed due to mix effects from a higher OPEX ratio compared to the rest of the Healthcare business. Finally, lower utilisation of the cost base in Employee and Labour Market services due to lower-than-expected activity also contributed to the ratio increase.

Sales and administrative expenses (SG&A) increased by DKK 82 million to DKK 789 million, of which the inclusion of Frisk Gruppen accounted for DKK 48 million. In addition, in other parts of the Healthcare business, investments were made in both commercial and digital capabilities to support continued growth and optimisation. Despite these investments, the SG&A ratio decreased to 18.9% (19.7%), partly owing to a below-average SG&A ratio in Frisk Gruppen, which therefore contributed to positive mix effects.

EBITA decreased by DKK 25 million to DKK 489 million mainly driven by the above-mentioned lower utilisation in Employee and Labour Market services, higher energy and supplies costs and investments in SG&A to strengthen commercial and digital capabilities. As a result, the EBITA margin decreased to 11.7% (14.3%).

Free cash flow before tax decreased by DKK 217 million to an inflow of DKK 151 million, corresponding to a cash conversion rate of 30.9%. The cash flow was adversely impacted by a change in timing of monthly subscription payments as well as timing of trade payables in Consumer and Technical services and by a temporary build-up of trade receivables in Employee and Labour Market services due to a change of billing system towards the end of the year.

Portfolio

Revenue and EBITA decreased due to divestments and discontinuation of operations as part of the strategy to exit business activities in the Portfolio segment.

Revenue decreased to DKK 809 million (DKK 1,691 million), mainly due to the divestment of the Roadside Assistance business outside Denmark which was completed in March 2022. The discontinuation of patient transport service contracts in the US (mainly in the East Coast region) and Slovakia as well as the divestment of ActivCare in Denmark in late 2021 also formed part of the explanation. The continuing operations reported organic growth of 25.3% primarily due to increased activity levels in Falck Global Assistance fueled by a significant increase in travel activities in the Nordic countries.

Cost of services (OPEX) decreased to DKK 615 million (DKK 1,393 million) as result of divest-

Key figures 2022

ments and discontinued operations. In addition, efficiency improvements across the remaining businesses and better utilisation due to the increased activity in Falck Global Assistance had a positive impact on the OPEX ratio, which decreased by 6.4 percentage points to 76.0%.

Sales and administrative expenses (SG&A) decreased to DKK 210 million (DKK 309 million), driven by divestments and discontinued operations. However, the SG&A ratio increased by 7.6 percentage points to 25.9%.

EBITA decreased by DKK 28 million to DKK 5 million, corresponding to an EBITA margin of 0.6% (1.9%). Divestments and discontinued operations had a negative impact of DKK 83 million, whereas EBITA from continuing operations increased by DKK 65 million mainly due to improved profitability in Falck Global Assistance resulting from increased activity levels.

Free cash flow before tax was an outflow of DKK 5 million (outflow of DKK 52 million). This corresponds to a negative cash conversion rate of 96.3%, mainly driven by negative cash conversion in the divested business entities. Last year, the cash conversion rate before tax was negative at 157.9%.

Businesses in Portfolio

As part of Falck’s Care for more ‘25 strategy, a number of non-core business entities have been regrouped to the Portfolio business area as they are considered to have limited strategic fit. This allows Falck to focus its strategic efforts on core business areas and to optimise the value of the portfolio independently of the strategic direction of the core business.

Portfolio comprises the following businesses:

• Patient transport and ambulance services in Poland, Australia and Slovakia.

• Global travel assistance under the Falck Global Assistance brand in Finland, India, Norway, Sweden, Spain, Denmark, Turkey, Thailand and the US.

Financial results for the Group

In Q4, the Falck Group generated organic revenue growth of 5.0%, excluding testing activities. EBITA increased compared to last year, excluding testing activities despite elevated operational costs due to increased fuel and energy prices.

rebranding and strategic initiatives to support the execution of Falck's Care for more ‘25 strategy. The decrease was partly driven by the divestments carried out during the year and partly by Q4 last year being negatively impacted by ramp-up cost and accruals made in connection with starting up the contract in San Diego. As a result, the SG&A ratio improved to 17.6% (19.1%).

EBITA increased by DKK 55 million to DKK 118 million. This was mainly driven by Emergency Health and Safety, where the addition of the San Diego contract contributed to the increase together with improved performance in Ambulance Europe. In the latter, operations in Denmark have improved during 2022 compared to Q4 last year, where contract-related penalties, high overtime levels and costs for

closing and scaling down two large contracts negatively impacted EBITA. As a result of both improved OPEX and SG&A ratios, the EBITA margin increased to 3.9% (2.1%).

Total revenue for the Group decreased by DKK 650 million to DKK 3,030 million and total EBITA for the Group decreased by DKK 157 million to DKK 118 million. The decrease is mainly explained by the public antigen testing contract with the Danish regions, which ended in March 2022.

All numbers in the commentary relating to the components of EBITA and the cash flow are stated excluding the financial impact from the public testing activities that Falck carried out in 2021 and until the contract expired in March 2022.

Revenue was slightly lower than last year at DKK 3,030 million (DKK 3,036 million). However, underlying organic growth was 5.0%. This was to a large extent driven by the San Diego contract, which more than offset reduced contract volumes in Ambulance Denmark, but organic growth across all other business units also contributed. The broadbased organic growth was driven by a combination of higher pay-on-use activities, a larger subscription base, higher contract volumes and price increases. The net impact from divestments and the acquisition of Frisk Gruppen was negative at 6.9%, whereas foreign exchange effects provided a positive

impact of 1.7 percentage point (mainly from USD). Consequently, reported growth was 0.2%.

Cost of services (OPEX) decreased by DKK 19 million to DKK 2,398 million. The decrease was a result of OPEX in divested operations more than outweighing the increase in OPEX from the San Diego contract, the inclusion of Frisk Gruppen and higher fuel and energy costs. Last year, OPEX was negatively impacted by provisions related to the exit from Danish ambulance contracts. Foreign exchange effects had a modest, negative impact on OPEX compared to last year. The OPEX ratio improved slightly to 79.1% (79.6%) and was not materially impacted by foreign exchange effects.

Sales and administrative expenses (SG&A) decreased by DKK 45 million to DKK 534 million despite non-recurring costs related to global

Key figures Q4 2022 Revenue growth, excl. testing activities

Free cash flow after tax (excluding public testing activities) was an outflow of DKK 210 million (outflow 331 of DKK million) negatively impacted by timing of annual prepayments from the Danish public fire and ambulance customers, which led to a significant decrease in contract liabilities. Last year, free cash flow was negatively impacted by payment of postponed employee-related taxes and on-account income taxes.

Emergency Health and Safety

EBITA was DKK 81 million higher than last year, due to:

• Higher volume and price increases in Ambulance US and other contracts

• Last year was negatively impacted by ramp-up costs in connection with starting up the San Diego contract and by high overtime levels and contract-related penalties in Ambulance Europe and US

Healthcare

EBITA was DKK 16 million lower than last year due to higher energy, utility and supplies costs as well as lower utilisation in Employee and Labour Market services.

Group costs and eliminations

Group costs were 11 million lower than last year despite non-recurring costs related to global rebranding and strategic initiatives to support the execution of Falck's Care for more '25 strategy.

Portfolio

EBITA was DKK 21 million lower than last year primarily due to a negative impact from the divestment of businesses of DKK 22 million.

(EBITA, DKK million, excluding testing activities)

Development in EBITA, Q4 2021 to Q4 2022

04

Sustainability

Our sustainability strategy seeks to advance healthcare while reducing climate impact. We have progressed in 2022 by delivering more services, reducing carbon emissions from our fleet and committing to the Science Based Targets initiative.

Climate change is the single biggest global health threat

We are committed to pursuing a sustainability response to safeguard public health and further enable the green transition of societies.

The World Health Organization (WHO) recognises climate change as the single largest global threat to public health and its impacts are already evident.

People's health is a foundation for a healthy and prosperous society, and high-quality healthcare and emergency services are vital for securing this. While being impacted by climate change, the healthcare sector also accounts for 4-5% of global CO2 emissions1. As a provider of healthcare and emergency services, we wish to do our part to reduce these negative impacts and contribute to finding solutions.

At Falck, we are committed to helping resolve current and emerging public health issues, some of which arise directly from climate changes, through relevant services and support of healthcare systems. It is our bold

ambition to advance healthcare while at the same time reducing our climate footprint.

Growing demand for healthcare has already surpassed what can be provided by available healthcare professionals. Looking ahead, the WHO forecasts a global shortage of 10 million healthcare workers by 20302

For many reasons, healthcare systems are under pressure in most countries and innovation is needed to maintain or improve the quality of services while meeting these challenges.

Falck’s sustainability strategy

Against this backdrop, we took a significant step forward on our sustainability agenda in 2021, and further developed our sustainability strategy in 2022. With our purpose to advance sustainable healthcare as a starting point, we

1) Source: The lancet, 2021. https://www.thelancet.com/journals/lanplh/article/PIIS2542-5196(20)30271-0/fulltext 2) WHO, https://www.who.int/health-topics/health-workforce#tab=tab_1

strive to address some of the biggest global challenges facing the world today – namely those within healthcare and climate. We have responded within those areas where we believe we have the greatest societal impact, and backed this up with targets and KPIs across the business.

We strive to

• Advance healthcare

• Reduce climate impact

• Secure healthy and diverse workplace

• Build trust

Our results and aspirations

In 2022, we contributed to society by delivering 8.9 million healthcare and emergency health and safety services. We committed to the Science Based Targets initiative, achieved a slight reduction in emissions from our fleet (scope 1), improved our Lost Time Injury rate (LTIR) and our whistle-blower reporting ratio remained satisfctory.

We have commenced on a transformational journey. This is paramount to innovate our services and business to provide quality healthcare to more people with less of an environmental impact.

In 2023, we will:

• Continue to improve our existing ways of working, and develop smarter, new and transformational ways to deliver our services in more climate-friendly ways

• Prepare to submit Science Based Targets no later than 2024, and thereby extend our commitment to the value chain

• Prepare and implement reduction initiatives for our operations and value chain

• Increase data maturity and continue with limited assurance of selected ESG targets

• Prepare for upcoming Corporate Sustainability Reporting Directive (CSRD)

Since 2019, we have been participants of the UN Global Compact, and have committed to the Ten principles on Human Rights, Labour, Environment and Anti-corruption.

In addition to this report, we disclose our progress made in the newly established database for UN Communication on Progress.

Materiality assessment

Our sustainability strategy is based on an assessment of what is most material to our business and stakeholders. We have initially identified and assessed our most material ESG areas through desk-based research, internal discussions and on-going dialogue with stakeholders in the societies where we operate. This assessment guides us in pursuing prioritisation and mitigation strategies. Going forward, we will prepare an extended double materiality assessment, also in compliance with the Corporate Sustainability Reporting Directive (CSRD). The CSRD will apply to Falck from 2025.

What are the main areas affecting our stakeholders Why it matters to our business Materiality aspects

Accessible healthcare

• Unequal healthcare access

• Inadequate elderly care

• Prolonged sick leave periods

• Outbreaks of diseases and pandemics

• Digitalisation of services

Advancing healthcare is the core of our business. We need to continuously deliver and innovate quality healthcare to address these societal needs in an affordable way.

Our strategy mainly impacts the following four SDGs

SDG #3 Good health and well-being – our services contribute to the health and well-being of people and societies. We save and improve lives every day, and we want to innovate and advance healthcare.

SDG #13 Climate action – we want to reduce the climate impact from our fleet and extend our commitments to our value chain. We will align our targets with what science says is necessary to reach the goals of the Paris Agreement.

SDG #8 Decent work and economic growth – employees are our most important asset, and we want to ensure a healthy and diverse workplace where employees can thrive personally and professionally.

SDG#16 – peace, justice and strong institutions. We want to conduct business in a way that never breaches the trust of our employees, partners or customers.

Climate change adaptation

• Insufficient climate action

• Climate change has an adverse impact on public health

Responding to climate change requires us to continuously reduce emissions and invest in new ways to deliver our services in a more sustainable way.

Shortage of healthcare professionals

• Employee health and safety

• Diverse and inclusive culture

• Working conditions

In a tight labour market, we need to continuously develop our workplace in order to attract and retain sufficiently skilled staff to provide our services.

Patient trust and business ethics

• Patient safety and trust

• Unethical business behaviour

• Leak of personal data

• Cumbersome patient journey

People rely on us, and that requires us to be a trusted business partner to the local authorities and communities which we serve.

Sustainability strategy

Ageing populations

Societal trends

Need for enhanced efficiency, flexibility and sustainability in the delivery of healthcare solutions

Shortage of healthcare professionals

Societal trends

Constraints on public healthcare systems

Climate change implications

Risk of global pandemics and viruses

Our purpose

Advance sustainable healthcare to meet people’s changing needs

Advance healthcare

• Deliver services to society

Reduce climate impact

• Reduce CO2, total

• Reduce CO2, relative

• Commit to the Science Based Targets initiative in 2022

Our sustainability response Target areas

• Submit Science Based Targets

Secure healthy & diverse workplace

• Promote employee engagement

• Ensure gender diversity and inclusion

• Improve safety performance

Build trust

• Secure whistle-blower reporting ratio

• Complete code of conduct training

We transform to advance healthcare

Four parallel tracks to advance healthcare

Through our sustainability strategy we want to advance healthcare to more people, while at the same time reducing our climate impact. We have embarked on a business transformation at Falck to achieve this. In the years to come, we will change our current ways of working by giving more emphasis to transformational ways.

The vision is to reduce the need to, e.g. transport people to the hospital, which would have a positive effect on patients’ quality of life and significantly reduce carbon emissions. Therefore, we need to convert existing ways of working into more climate-friendly ways, find smarter ways of working, new ways of working and to transform the way we approach services and patients.

Smarter ways of working

New ways of working

Transformational ways of working

Existing ways of working

Using drones for transport

Pre-empt hospitalisations through monitoring

Electrifying our fleet

We work on reducing emissions from the existing ways of delivering our services. Emissions are curbed by converting our fleet to electrical vehicles to the widest extent possible. We are improving fuel efficiency and we are testing different solutions for vehicles.

Virtual consultations

We identify smarter ways of working and solutions than e.g. by sending healthcare professionals physically to where the patients are. Online consultations and the digitalisation of services are some of the alternative ways of working.

We aim to use innovative new technologies to deliver our services, and drones play a key role. The use of drones to transport blood samples and similar items is currently being tested. Using drones would benefit our climate footprint and provide faster diagnosis. This could even reduce serious illnesses and hospitalisations.

We are exploring how we can anticipate and prevent the need for ambulances and other vehicles. Transformative ideas evolve around developing solutions that can monitor patients 24/7 at home. For instance, patients could have treatment enabled by digital solutions, and treatment can take place before a critical situation potentially occurs.

More services delivered

Our response

Our targets and progress

Deliver services to society

What we did in 2022

• Delivered more than 24,000 services on a daily basis, saving and improving lives

• Tested drones in Greenland and Denmark to transport samples for i.e. diagnostics

• Developed patient experience innovation project in the US on the use of 911 (emergency system)

• Started a sustainable advanced visitation unit together with the Region of Southern Denmark, where our paramedics use hydrogen cars for less urgent emergency trips instead of ambulances

The combination of more multi-chronic patients, ageing populations and an ever-growing awareness among the younger generations elevates the overall demand for healthcare services. Therefore, we have included the number of services we provide as a key target area in our sustainability strategy.

Nearly 9 million healthcare services delivered In 2022, our highly skilled staff delivered 8.9 million healthcare services, up from 8.1 millon last year. These services were broadly delivered across prevention, treatments and rehabilitation.

Falck increased the volume of healthcarerelated services provided in 2022 – to a total

Services delivered in 2022

Every day, we go to work to improve and save lives, and we want to innovate and advance healthcare

of 5.3 million from 4.3 million in 2021. Part of the increase in services provided was attributable to the addition of Frisk Gruppen in November 2021. Across the Scandinavian countries, we increased the number of employee and labour market services provided. The rate of growth was around 23%

Emergency response on hydrogen started

Together with the Region of Southern Denmark, we have started a sustainable Advanced Visitation unit, in which our paramedics use a hydrogen-powered vehicle for emergency calls deemed less urgent. The first hydrogen-powered visitation unit rolled out from Kolding Hospital in 2022. It ensures better utilisation of our health professionals in the healthcare system while still providing citizens with the help and treatment they need.

with an uplift across the wide spectrum of physical, psychological and preventive treatments. In Colombia, we experienced a considerable increase in the number of virtual consultations. In Europe and the US, we dispatched our ambulances 3.6 million times to help people in need.

The mentioned numbers matter to us, because every time we have completed a trip, given a treatment, prevented an accident or provided one of our services, we have usually improved the life of at least one person – in some cases with profound effect.

Patient experience innovation in the US

During 2022, we began exploring potential ways to innovate in our US ambulance business. The project involved mapping out the current state of the 911 experience. We based our approach on patient and employee interviews, analysis of Falck operations data and observations in our California operations.

We identified that a significant proportion of people call 911 for low-acuity medical

issues. For example, in Alameda County 45% of 911 calls were less urgent and did not need to be treated in an emergency department1.

Based on this key insight, we designed new care models that would enable us to treat these patients in the home or in their local communities – bringing care closer to the patient and reducing logistical barriers to access.

The hydrogen car is equipped for examinations such as ultrasonography and blood tests. The vehicle is also equipped for the use of telemedicine, so doctors at the hospital can monitor a patient in real time and make a diagnosis. They can then assess whether the patient should be admitted, referred to their own general practitioner, or whether treatment can be completed in the patient's own home.

The hydrogen visitation unit is an example of how, at Falck, we work to develop alternative ways to promote health and help more people using fewer resources and reducing our climate impact. We will continue to explore new ways to deliver our services.

Overall, the number of services delivered has increased by 11%. We see a continued demand for the services Falck provides in the communities we are part of.

11%

Reducing CO2 emissions

The science-based conclusions from the Intergovernmental Panel on Climate Change (IPCC), a United Nations body, are unambiguous: To avert catastrophic health impacts and prevent millions of climate change-related deaths, the world must limit temperature rise to 1.5°C.

2.06

reduction of CO2 (scope 1) in 2030

CO2

tonnes

We are committed to doing our part. For a number of years, we have worked to reduce CO2 emissions from our fleet, which is our single biggest direct source of emissions. Around 75% of our carbon emissions (scope 1) originates from the ambulance business.

CO2 emissions from fleet

Baseline 2021

Science Based Targets initiative

Commit to Science Based Targets initiative in 2022

Submit Science Based Targets

What we did in 2022

• Committed to the Science Based Targets initiative

• Introduced 50 new electric cars for patient transportation in Denmark

• Introduced three new electric vans for our Roadside Services in Denmark

• Co-developed a sustainable procurement module to account and track scope 3 emissions within goods and services

The target is to reduce our direct emissions (scope 1) by 50% in 2030 from 2021 as the baseline. We have begun the transition from diesel and petrol-powered vehicles to electric vehicles and have adopted the use of biofuels. This is an ambitious target, however, since electrification depends upon significant innovation in battery technology, particularly when it comes to ambulances. At this stage, we are testing prototypes.

In 2022, we managed to slightly reduce our CO2 emissions from 53,194 tonnes in 2021 to 52,325 tonnes in 2022, equivalent to a 2% decrease. To support this trajectory, we aim to make our fleet for seated patient transports 100% electric by 2027.

Relative CO2 emissions

The direct emissions (scope 1) are closely linked to the need for our ambulance services and the volume of ambulance contracts operated. The number of trips depends largely on the needs

of the communities and societies where we operate, which may sometimes be beyond our control.

To supplement the absolute reduction target, we have also set a relative target because we want to measure our ability to reduce the climate impact of the individual services we provide. We aim to lower the ratio of our total scope 1 CO2 emissions to total revenue per year to 2.06 in 2030 (equal to a 10% reduction year-on-year).

The ratio recorded for 2022 shows we are on track: The relative number decreased by 12% from 5.31 to 4.661. We will continue to explore and pursue ways to make progress.

A transition to smarter, new and transformational ways of working, for instance through the increased use of online consultations and drones for transport, could be achieved through a shift from services highly dependent on a vehicle fleet to other, less CO2-intensive services which would favourably impact the relative CO2 emission value.

1) It should be highlighted that the previously reported relative CO2 number for 2021 (3.95) included revenue from testing activities. This baseline has been re-stated to 5.31. Testing activities are excluded from 2021 and 2022 numbers which is in line with the financial reporting for 2021 and 2022.

Our

Committed to the Science Based Targets initiative

Apart from our fleet, other parts of our operations and our value chain also have a climate impact. We consume energy in buildings, we use equipment in our ambulances, we buy goods and services, and our employees commute and go on business trips. Each of these activities generate CO2 emissions within one of the scopes 1, 2, or 3 guidelines of the Greenhouse Gas Protocol Accounting and Reporting Standard.

Therefore, we have committed to the Science Based Targets initiative and will include our value chain in our future science-based targets. With this commitment, we will define CO2 reduction pathways in line with the Paris Agreement and aligned with what, according to climate science, is necessary to limit the global temperature rise to 1.5°C. We will innovate new and transformative ways of delivering healthcare solutions to people in need.

The preliminary overview of our major emissions categories shows that the majority of emissions within our value chain (scope 3) come from purchased

goods and services (e.g. medical consumables, IT services, vehicles, etc). Current estimates show that 50-75% of our total CO2 emissions are expected to fall within scope 3.

During 2022, we co-developed a technical, sustainable procurement solution to get a better overview of emissions from purchased goods and services. Procurement data has been consolidated from different sources into a single dashboard and converted into CO2 data. This approach provides a solid methodology to do scope 3 emissions accounting, and to continuously track reductions over time. In addition, it is possible to incorporate data on scopes 1 and 2 emissions. This provides more transparency on our carbon footprint across the entire value chain.

The next step is to further elaborate baselines for scopes 1, 2 and 3, work strategically with reduction initiatives, and submit targets when they are ready, and no later than in 2024.

ISO environmental certification

We maintained our ISO environmental certification in 2022. ISO 14001 sets out the requirements for an environmental management system and helps Falck to improve its environmental performance through more efficient use of resources and by reducing waste, in turn gaining a competitive advantage and the trust of stakeholders.

We hold an ISO 14001 Environmental Management certification for our ambulance services in Sweden and Spain, for our fire services in Italy, Portugal, Romania, Slovakia, Spain, the Netherlands and the UK and for our headquarters in Copenhagen, Denmark.

Scopes. The Greenhouse Gas Protocol accounts for carbon emissions by classifying them into three categories, or “scopes.”

• Scope 1 (direct emissions from owned or controlled sources, e.g. company facilities, company cars)

• Scope 2 (indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by the reporting company)

• Scope 3 includes all other indirect emissions that occur in a company’s value chain (e.g. purchased goods and services, employee commuting and upstream transportation).

Strengthening engagement and diversity

To

good care of others, we need

ourselves

Our targets and progress

Ensure gender diversity and inclusion

Board of Directors1, underrepresented gender/total Executive Management, underrepresented gender/total Executive Management + Senior management, underrepresented gender/total by 2025

Improve safety performance

<8.8 0

Lost Time Injury Rate in 2027

(10% reduction y-o-y)

Baseline 2021

Fatalities

1) The Board of Directors consists of two women out of six members, which is equal representation (40/60) in accordance with guidelines from Danish Business Authority. Only members elected by the General Meeting are included.

2) 2021 sustainability reporting on LTIR included COVID-19 cases, and the LTIR was reported as 22.1 in the sustainability report, 2021. This has been restated, see accounting policy on page 47.

We are a healthcare business with skilled and dedicated professionals as our most valuable asset. Consequently, it is a big priority at Falck to provide a healthy, diverse and inclusive workplace and for our employees to thrive personally and professionally, regardless of their individual differences. Employee engagement, development and retention is essential for Falck in safeguarding long-term, sustainable business development.

For all those reasons, we are committed to continuously improving the levels of engagement, health and safety among our employees and encourage diversity as well as inclusion in our workplace.

Stable level of employee engagement

Each year, we conduct a global employee engagement survey. The target is to increase the employee engagement score (eSat) to 75 in 2025. In 2022, the engagement score was 72. This corresponds to the level in 2021. The score is based entirely on employee responses to the question: "How happy are you working at Falck?".

Looking at the survey more broadly, we saw positive developments in important measurements in 2022. In almost all business units, we observed improved scores on 15 questions, although there was a decline on two questions.

Across the business, we have seen a particular increase in employee satisfaction with the immediate manager. This score has increased by 10 percentage points over the past three years.

Some business units have significantly improved their results after being identified as areas requiring special attention in 2021. The specific focus on teams with low scores on selected questions has yielded particularly strong outcomes.

The score on purpose was again very high (84), also compared to the benchmarks (79). The score has increased slightly from 2021 and indicates that Falck provides a purposedriven and meaningful workplace, where employees contribute to saving and improving lives every day.

Employee engagement survey 2022

• 21,215 invited

• 27 questions

• 15 scores improved

• 2 scores deteriorated

• 63% response rate

• 25,650 comments

• 4 new countries included

Purpose 84 (+1)

Related question: “The work that I do at Falck is meaningful to me.”

Recommend Manager 77 (+2)

Related question: ”I would recommend my manager to others.”

Turnover remain high

The staff turnover rate was 28.8% in 2022, almost the same as last year (29.0%), and remains at an unsatisfactory level. The staff turnover rate is excluding people employed for antigen testing activities. In 2022, we took a broad range of initiatives, such as implementing a global project to identify root causes of churn and to develop appropriate solutions. We focused on frontline recruitment, and established task forces in targeted countries with the emphasis on building and expanding an attractive workplace. Locally owned initiatives have been supported by a global toolbox and sparring.

Having a diverse and inclusive culture matters

We are confident that a workplace with a strong corporate culture embracing diversity and inclusion fosters innovation, better decision-making, engagement, brand attractiveness and many other benefits.

We strive to promote a diverse workforce and an inclusive culture where employees are treated with respect and provided with the resources and opportunities they need to thrive personally and professionally, regardless of their individual differences. We work with a broad understanding of diversity; covering both visible and invisible differences.

Targets to improve diversity

To promote gender diversity at management levels and generate a cascading effect, we have set targets for the Board of Directors

Employee engagement

What we did in 2022

• Reinforced our established approach to work with action plans. 1,600 action plans were prepared, and the progress was followed up on

• Focused approach to teams and areas with low scores on either Engagement, Respectful Treatment or Recommend Manager

• Dedicated efforts to target pain points within selected business units

• +1,000 leaders have now completed the Falck Leadership Programme. The scores relating to immediate managers have all increased significantly in the past two years

• Investigation in churn and targeting activities initiated in certain markets, including Germany, the US and Colombia

and the Executive Management, but also for Senior Management, who are people managers reporting to Executive Management. In 2022, we maintained an equal gender representation on the Board of Directors and in Executive Management, as in 2021, and we aim to maintain an equal representation of at least 40% of the underrepresented gender. Equal representation is defined as a 40/60 gender composition in line with guidelines from the Danish Business Authority

In 2022, we set a new combined target for the Executive Management and Senior Management, namely to adhere to an equal representation of at least 40% of the underrepresented gender at these management levels by 2025. The baseline for the new target is 33% (baseline year 2022).

1 The Board of Directors consist of two women out of six, which is equal representation in accordance with guidelines from Danish Business Authority. Only elected members are included.

1 The Board of Directors consist of two women out of six, which is equal representation in accordance with guidelines from Danish Business Authority. Only elected members are included.

We added a 2025 combined target for gender diversity for executive and senior management

Diversity and Inclusion Policy

Falck’s Global Diversity and Inclusion Policy serves as the framework for our approach to diversity and inclusion. The Board of Directors has the overall responsibility for approving the Policy, and the guidelines of the Policy apply to everyone at Falck, including leaders at all levels, all employee categories (full-time, part-time, temporary, students, etc.) and contractors working for Falck.

→ Read our Diversity & Inclusion Policy here

Improvement of safety performance

Every day, our employees put themselves at risk to save the lives of other people. To safeguard our employees, we promote a culture where safety is embedded in our ways of working to ensure that everyone returns home safely. While incidents still occur across our business, we are determined to reduce the number to a minimum.

It is an integral part of our business operations to continuously improve global processes for reporting of incidents at work, raising awareness through campaigning, as well as collecting data and analysing it.

The incidents reported in 2022 mainly occurred during routine activities such as exercise, maintenance, training and other non-emergency activities (around 45%) and handling patients (around 20%). Incidents occurred during emergency activities where external factors, which usually have a large influence, accounted for around 20%.

This insight enables us to focus even more on safety procedures, global processes and awareness to mitigate incidents.

• Global application for safety incident reporting developed. Implementation in early 2023 and to be accessible to all employees

• Implemented a global procedure for safety incident reporting

• Conducted a course in incident investigation using recognised methodology

• Focused on building a stronger global safety community

• Set and committed to a new target of 40/60% gender distribution in Executive Management and Senior Management, combined, by 2025

• Facilitated diversity and inclusion workshops for our global Talent Acquisition Community on inclusive language and bias awareness in recruitment

• Developed master class concept for top 100 management on how to improve gender diversity and inclusion and to develop strategies for managing effective change and inclusive leadership

• Continued implementation from 2021, such as the internal diversity and inclusion site and related communication activities

We strive to achieve a 10% reduction year-onyear with 2021 as our baseline year. In 2022, 563 Lost Time Injuries were recorded, which resulted in an Lost Time Injury Rate (LTIR) of 14.3. This is an improvement from 16.5 in 2021, equivalent to a decrease of 13%. We are committed to continue lowering the rate. Our target is to reduce the LTIR to below 8.8 by 2027.

Our global reporting was further enhanced in 2022 to improve performance measurement of health and safety. This has further elevated the conditions for conducting deep-dive analytics and on that basis commence initiatives to either keep up or improve standards. It allows us to look into the root causes of incidents, tailor safety initiatives and develop documented processes where needed.

To back up efforts, we established a safety community with representatives from all business units to implement our safety strategy in all parts of the business. This has been backed by investments in educational programmes towards employees to build, expand and maintain safety skills.

Zero fatalities

Every life is precious, and every single fatality is a tragic reminder that safety must always come first. Our target is zero fatalities, and in 2022 there were no fatalities.

• Identified operations where focused attention is needed to improve safety performance

We build trust

People and societies rely on us every day, and that requires us to be a trusted business partner. Trust is vital to our license to operate, and it is essential that we conduct business in a way that never breaches the trust of our employees, our partners, our customers or the communities in which we operate. Unfair competition and unethical behaviour result in higher costs and erosion of trust.

In our operations, we support and respect the protection of human rights, and we are committed to advancing these rights.

Our business is conducted with integrity and high ethical standards in compliance with applicable laws, regulations and in-house policies. We seek to be transparent, be competing for business on fair terms, adhere to good corporate governance and proactively identify and mitigate compliance risks.

All full-time employees trained every second year

What we did in 2022

• Implemented Falck Alert procedures and thereby strengthening governance

• Ran whistle-blower communication campaign in selected markets

• Revised our Code of Conduct, creating two separate versions aimed at suppliers and employees

• Further anchored associated policy ownership with relevant functions to ensure implementation

• Developed training materials for both online and in-person sessions

• Ran campaign on gifts and hospitality to increase awareness

Secure whistle-blower reporting ratio

We promote a global speak-up culture and have adopted a zero-tolerance approach towards breaches of our Code of Conduct.

There is a zero-tolerance practise towards any form of bribery or corruption, whether committed by employees, agents or any other business partners. Read our Anti-Corruption Statement here.

Our whistle-blower system, Falck Alert, is available to all employees, business partners and third parties 24/7, and we continuously encourage employees to report concerns about irregularities or improper actions that fail to comply with applicable laws and regulations, our Code of Conduct or in-house policies.

Various types of unethical behaviour are reported through the system, and these are all investigated and concluded.

To emphasise the priority and importance, we have set a target for our whistle-blower reporting system. The target is to have a ratio above 1 report per 100 employees, as such level would be a strong indication of employees trusting the system and knowing they can use it without fear of retaliation.

The reporting ratio for 2022 was 1.62, and thereby higher than last year, which indicates that it is an established and accesible whistle-blower system.

In 2022, we received 296 reports (227 in 2021), of which 58% were anonymous. This is in line with a weighted average for organisations within the NAVEX Global database. The cases reported via Falck Alert fall within the following top-five categories:

1. Compliance with laws and standards (21%): These reports related to non-compliance with e.g. our standards for uniforms or similar

2. Misconduct or inappropriate behaviour (19%): The reports related to a range of inappropriate behaviour that makes people uncomfortable or create a hostile working environment

3. Working conditions (18%): Most reports related to staff shortage

4. Discrimination and harassment (15%): The reports related to sexual harassment, discriminatory treatment and bullying

5. Leadership (10%): The reports related to various managerial issues, e.g. leadership style, communication and fair distribution of work.

Out of 296 cases reported, 29 led to termination of employment, 11 to written warnings and 57 to additional instructions or guidance.

Governance and processes were strengthened even further during 2022 through various measures. Firstly, a globally standardised approach to investigations was implemented. Secondly, local investigators within Falck were engaged, reporting to the global Head of Investigations. Thirdly, the two bodies established in 2021, Compliance Advisory Board and the Compliance Community Forum, came into full operation and the outcome has been an even stronger collaboration and understanding of the value that Falck Alert adds to the business.

Increased Code of Conduct training

Our global Employee Code of Conduct sets out the minimum standards and ethical principlesby which all Falck employees must abide. It provides our employees with a common understanding of how we conduct business and promotes high ethical standards for everyone at Falck.

It is key to embed the Code of Conduct for employees in the way we work via training, communication and awareness campaigns. We are committed to ensuring that all full-time employees are trained every two years either online or in person in order to foster a culture of integrity and trust.

During 2022, several steps were taken to improve this year’s Code of Conduct training

efforts and results. As a result, we have seen a vast improvement in the completion rate by full-time employees to 81%.

In 2021, 55% of full-time employees completed the training. This was not a satisfactory percentage in terms of our ambition to integrate the Code of Conduct in the way we work.

One key objective for conducting the training is to ensure that we build a compliance culture to respect the protection of human rights. This also includes protection of labour conditions, and both areas are covered as part of the section on Respecting People in the Code of Conduct training.

Code of Conduct for suppliers

We rely heavily on goods and services delivered by suppliers to perform our services. Therefore, ethical and corect conduct by everyone in our supply chain is imperative to us.

All suppliers, and their sub-suppliers, must therefore comply with Falck’s Supplier Code of Conduct and are required to communicate the obligations set out herein and ensure compliance with the Code throughout their organisations and supply chains. Read our Code of Conduct for suppliers here.

Advisory Board and Community Forum enhance whistle-blower governance

The Compliance Advisory Board advises and provides recommendations on the outcome of investigations taking precedence. The board consists of members of the Executive Management.

The Compliance Community Forum shares insights, engages in dialogues and raises concerns that may be of relevance to the business. The Forum consists of union representatives and other relevant stakeholders.

Employee Code of Conduct topics

• Respecting people

• Health and safety

• Anti-bribery and anti-corruption

• Conflicts of interest

• Gifts and hospitality

• Communication

• Safeguarding information

• Our responsibility to the environment

• Speak up

→ Read our Code of Conduct for employees here

We do not tolerate any illegal or unethical behaviour as explained by the Falck Code of Conduct for employees and other related (internal) policies. Our policy on Human Rights, which we updated in 2022, sets out clear expectations and minimum requirements. Read our Human Rights Policy here.

Gifts and hospitality campaign

To combat corruption and mitigate compliance risks in this area, Falck updated its policy and procedure on gifts and hospitality in 2022. The policy sets out clear requirements for the giving and acceptance of gifts to or from external parties. On that basis a platform for registering and recording of approved gifts and hospitality is in place. Employees are trained in the areas of anti-corruption and gifts and hospitality as part of the Code of Conduct training, and a campaign was carried out to increase awareness.

Governance and the way we monitor progress

Our sustainability efforts are an integral part of our daily business decisions and strategy, and our commitment is embedded in the ways we work, in our Code of Conduct for employees and suppliers and in our Winning Behaviours. Initiatives are managed by the management teams of the relevant business units and group functions. KPIs and targets are decided by the Executive Management. The Audit Committee is responsible for monitoring ESG data and processes, and the Board of Directors sets the direction and approves the strategy and targets. Annual results for each KPI are approved by the Board of Directors and presented in Falck’s Annual Report.

Progress is monitored through an ‘ESG dashboard’ (Environmental, Social and Governance indicators) and reported on an annual basis. Selected ESG targets (CO2 reduction scope 1, LTIR and employee engagement) are part of the ESG-linked refinancing of our long-term credit facilities.

Policies clearly setting out expectations and minimum requirements are key to delivering on our sustainability strategy and conducting business, such as policies on Sustainability, Human Rights, Diversity & Inclusion and several other key policies.

→ Read more here www.falck.com/policies

ESG Governance

Responsibilities

Board of Directors

• Approves targets and strategy

• Reviews progress and approve annual reporting

Audit Commitee

• Monitors processes and controls of all ESG tracks

Executive Management

• Overall accountable

• Set direction and decides targets

Sustainability Lead

• Governance, oversight and drive agenda

• Reporting of progress and communication

Workstream Leads

• Execution and target progress

• Data on progress

Finance and accounting

Control and Assurance of data Finance

Third party (Assurance)

• Data collection and control

• Framework and guidelines for data processes

Board of Directors 45 Falck Annual Report 2022 Management’s review Sustainability

Global Communication, Branding & Sustainability

No. of services Employee engagement Gender diversity Safety performance Whistleblower Code of Conduct

ESG key figures

1) CO2-emissions, relative (scope 1) reported in 2021 is not comparable to 2022. In 2021 reported CO2-emissions, relative (scope 1), antigen testing activity were included whereas in 2022, antigen testing activity was excluded. Thus, the 2021 number is restated from 3.95 to 5.31.

2) Baseline year for this target is 2022.

3) Lost time injury (LTI) reported in 2021 is not comparable with 2022. In 2021 reported LTI, COVID-19 cases were included whereas in 2022, COVID-19 cases are excluded. Thus, the 2021 number is restated from 22.1 to 16.5.

The Sustainability reporting and accounting policies cover the period 1 January – 31 December 2022.

Falck Group consists of core business and portfolio business. Scope for this reporting is core business which is Falck’s strategic focus area. The core business covers Emergency Health and Safety (which includes Ambulance Europe, Ambulance US and Fire services) and Healthcare (which includes Community Health services, Consumer and Technical services and Employee and Labour Market services).

CO2 emissions, total

This indicator is defined as the total scope 1 CO2e emissions (CO2 equivalent) measured in tonnes. Scope 1 emissions refer to direct burning of fossil fuels by either mobile (vehicles) or stationary (generators, heating systems, etc.) combustion. Excluded from Falck’s definition of Scope 1 are fugitive emissions from air conditioning or fire suppression systems.

The indicator is calculated following Greenhouse Gas Protocol standards following an operational control model. The number of litres (separated by fuel type, type of combustion, and type of vehicle) is multiplied by the relevant EPA (U.S. Environmental Protection Agency) emissions factors. In certain locations it is not possible to get exact fuel data from our suppliers or internal systems. Where this is the case, emissions are calculated in one of three ways: kilometers data multiplied by the relevant EPA emissions factors; estimated from a comparable business entity; or estimated from historic fuel data.

CO2 emissions, relative

The CO2 emissions, relative, is defined as the indicator CO2e emissions, total tonnes, scope 1 divided by revenue from the core business excluding antigen testing activities in DKK million according to Falck segment note from the consolidated financial statement.

Restatement

CO2 emissions, relative, reported in 2021 are not comparable with 2022. In 2021 reported CO2 emissions, relative, antigen testing activities was included whereas in 2022, antigen testing activities is excluded. Thus, the 2021 number is restated from 3.95 to 5.31.

Number of services

Number of services is defined as the sum of 10 specific kinds of services representing the business of Falck within Emergency Health and Safety and Healthcare. The numbers are rounded to the nearest thousand. All of the services have equal weight, and antigen testing activities are not included.

Emergency Health and Safety contributes with the number of ambulance trips and call-outs/interventions from the Fire services business.

Contribution from Healthcare is the following:

• Community Health services contributes with the number of virtual consultations and physical consultations.

• Customer and Technical services contributes with the number of patient transport services (PTS) trips, number of roadside assistance (RSA) trips and first aid trainings.

• Employee and Labour Market services contributes with the number of physical treatments, psychological treatments and preventive care.

Employee engagement

Employee engagement is defined as the average employee satisfaction score (eSat score) on the question “How happy are you working at Falck?” in the annual employee satisfaction survey for the relevant financial year. It is measured on a 0-100 scale. The survey is conducted by the external consultancy firm Glint and took place in autumn 2022.

In general, employees in Falck's core business are included in the survey. Included are employees who have a permanent or fixed term contract of

employment with Falck as well as selected freelancers (contractors) due to the nature of their activities. Employees starting after 20 August 2022 and employees registered leaving Falck on 21 September 2022 or earlier are excluded. Local adjustments to the selection criteria for the survey may apply.

Underrepresented gender, Executive Management

This indicator is defined as the percentage of the underrepresented gender in the Executive Management team. Executive Management is responsible for the day-to-day management and operations of Falck.

Underrepresented gender, Executive Management and senior management

This indicator is defined as the percentage of the underrepresented gender in the Executive Management team and Senior Management team. Executive Management is responsible for the day-to-day management and operations of Falck. Senior Management is managers reporting to an Executive Management member and with at least one employee in reference.

Lost Time Injury Rate

Lost Time Injury (LTI) is defined as a physical injury at work causing at least one day of absence in addition to the day of the injury. Lost Time Injury Rate (LTIR) is calculated as the number of LTIs per 1 million working hours. Working hours are defined as the total of normal working hours and overtime hours. Deducted are hours registered as leave.

Included are employees who have a permanent or fixed term contract of employment with Falck and are paid through Falck’s payroll-system, as well as selected freelancers (contractors) due to the nature of their activities and how they are paid.

Reporting on LTI is performed through monthly collection of data using a Microsoft Excel template and monthly review meetings where LTIs may be reclassified and local registrations of injuries are

assessed. The reporting includes injuries that occured in the reporting year and were reported before mid January in the following reporting year. Working hours are reported monthly to Global People and Culture, consolidated and validated. However, for some entities, working hours are estimated for some months based on historical data.

Restatement

LTIR reported in 2021 is not comparable with 2022. In the 2021 reported LTIR, COVID-19 cases were included whereas in 2022, COVID-19 cases are excluded. Thus, the 2021 number is restated from 22.1 to 16.5. This has been done by subtracting the number of LTIs that can be identified as COVID-19 in the registrations from 2021 from the LTIR calculation.

Fatalities

Any fatality of employees, subcontractors or third parties occurring at work.

Whistle-blower reporting ratio

Whistle-blower reporting ratio is defined as the total number of reported whistle-blower cases as ratio per 100 average FTEs for the financial year. The percentage difference between numbers of employees in Falck's core business compared to Falck Group is deducted from the total number of reports. FTE is defined as full-time equivalents which is the average number of employees calculated as total hours worked divided by full-time working hours per person for the year.

Portfolio business was included in previous year’s reporting, but not for 2021 and 2022.

Code of Conduct training

Code of Conduct training measures the completion rate of the Code of Conduct training, using percentage of full-time employees in Falck's core business trained in a given year.

05

Governance

The Board of Directors of Falck remains committed to consistently complying with sound and transparent corporate governance practises to meet expectations and promote responsible business behaviour, long-term trust and value creation.

Mitigating risks to safeguard our business

Risk management is an integral part of good management practice, and we are committed to embedding a strong risk culture across the organisation and ensuring that effective risk management is integrated in all activities and business processes.

Falck has implemented a risk management framework outlining a consistent approach in the identification, assessment, treatment and monitoring of key risks.

The risk management process is focused on supporting Falck’s strategy and plays an instrumental role in the decision-making of the Executive Management.

The risk management framework enables Falck to protect and improve its value by addressing uncertainty in strategic planning. Overall, it aims to ensure a forward-looking risk management approach that provides a holistic view of all risks across the organisation.

Falck continuously focuses on strengthening its risk culture to support the execution of its strategy and obtain business objectives.

The established risk management process enables Falck to ensure that changes in

external and internal factors are adequately captured and reflected in the strategic and operational planning. The regular evaluation of the Group’s risk performance and the delivery on its objectives serve as an indicator of an efficient risk management process.

In 2022, Falck focused on strengthening the risk awareness and integration of risk management into strategy review and business planning. The risk appetite, overall risk picture and progress on mitigating actions to the top-five risks for 2022 were monitored by the Executive Management, the Audit Committee and the Board of Directors on a regular basis.

The top risks for 2023 have been selected based on a holistic approach evaluating macroeconomic risks, sector trends as well as strategic and emerging risks for Falck on Group level.

In 2023, Falck will continue to conduct risk training and workshops to further raise awareness and enable timely identification of both existing and emerging risks.

Actions taken to mitigate the top-five enterprise risks in 2022

Two of the top-five enterprise risks disclosed in the Annual Report 2021 were downgraded following an assessment which showed that mitigating actions were successfully implemented. The remaining three continue to be on the list of top risks for next year.

Falck operates a risk management framework to support the business strategy

Mitigating actions taken during 2022 to address the top-five risks and their status is presented below.

A. Compliance breach

Falck further enhanced compliance via documenting key compliance areas, identifying owners and having visibility and transparency of controls. Training in due diligence continued, and an updated Code of Conduct for employees was launched in October 2022. This risk continues to be a top risk for Falck given the dynamic regulatory environment and highly regulated sector globally.

B. Shortage of healthcare professionals

In 2022, key initiatives led by People & Culture took place, and actions were implemented to improve the process of retention and attraction of healthcare professionals. Falck is better prepared to respond to internal factors that could elevate this risk, considering the challenging macroenvironment and labour shortages in the healthcare sector. The risk remains high, however, it was redefined based on improved internal processes.

D. Lack of commercial resources, capabilities and prioritisation

Several actions were taken based upon the findings from a gap analysis conducted across business units. The primary concern was to define and roll out a common methodology for recruitment and retention.

On that basis, proactive recruitments for key positions were completed across the business to close identified gaps. The risk is downgraded based on implemented actions, however, it will be monitored during 2023.

E. Insufficient operational due diligence and incomplete integration of acquired entities

A comprehensive integration manual and governing documents related to M&A activities across Falck were developed in 2022. Potential acquisitions are evaluated for strategic fit based on the M&A Policy and Falck Authorisation matrix prior to being handed over to the business for further assessment.

ISO certifications in Falck

Falck has developed the Quality Model (QM) framework to ensure high quality of execution of its services across its operations. The associated framework and business processes are found in Falck’s integrated Management System GEMS, which is ISO certified.

This supports Falck in maintaining the appropriate internal control environment and ability to demonstrate fulfilling requirements associated with global certifications from the globally recognised ISO Standards 9001 (Quality Management), 14001 (Environmental Management), 45001 (Occupational Health & Safety Management) and 27001/27701 (Information Security Management), as well as legal and regulatory requirements in the countries where Falck operates.

C.

Cybersecurity attack, insufficient planning of emergency preparedness, crisis management and business continuity

Recovery plans for the most critical systems were developed. Close monitoring of the implementation and regular reporting to the Audit Committee were performed throughout 2022. Falck will continue to execute its cybersecurity programmes to enhance resilience. The risk remains high considering vulnerable external factors, global operations and further digitalisation.

The risk is downgraded due to implemented actions and a successful integration of Frisk Gruppen.

The three top enterprise risks for 2022 which remain high are found on the list of top-six risks for 2023. The list of top-six risks for 2023 contains three new risks.

Top-six risks identified for 2023

Risk description

Regulatory compliance risk Workforce shortage Cyber-attack risk

Compliance with relevant regulatory requirements is a condition for Falck to conduct its business. These regulatory requirements may be international, national or local laws and regulations, as well as standards or recommendations of regulators or supervisory authorities with jurisdiction in countries where Falck operates. Such requirements might relate (without limitation of others) to the healthcare sector and medical standards, to the interaction with consumers and handling of personal data, or to conducting business within the frame of business ethics or competition law. Failure to meet regulatory compliance obligations may result in a range of consequences such as prohibition from continuing operations, ban on bidding for public contracts, litigation from third parties, substantial fines and penalties and may have significant adverse impact on Falck’s reputation.

Planned mitigating actions

Falck will continue to monitor changes in laws and regulations locally and globally and train the organisation to ensure compliance. Upon completion of the overview of compliance areas, respective plans for adequate training and assessments of efficacy of processes and controls will be conducted. Falck will ensure further implementation of its data protection framework across the organisation, including retention and deletion rules, and process and system owners in Falck will be asked to ensure review and update of controls on access rights on a regular basis.

Impacted by external and macroeconomic trends, staff shortage continues to be a challenge. Attraction of qualified candidates is challenging on the labour market, e.g., within IT, analytics and customer intelligence and service. Most critical is shortage of healthcare professionals which has a direct impact on Falck’s operations. This leads to increased retention costs for the existing workforce, as well as the risk of not being able to meet contractual obligations.

Internal workforce shortage and subsequent understaffing and overtime could have a negative impact on employee engagement, health, safety and well-being, and result in an increase in sick leave. This risk may adversely impact Falck’s reputation as an attractive employer and deteriorate its market position.

The risk of a targeted cyber-attack or broader cyberterror attack continues to prevail to Falck’s systems, networks, products and services as well as to the confidentiality, availability and integrity of Falck’s data. Such an attack would compromise Falck’s cyberdefense and could block global operations and prevent Falck from delivering products and services. In the shadow of international conflicts and wars, the risk of severe state-sponsored cyber-attacks and cyberterror has increased substantially on top of the ever-increasing cybercrime. Falck has built a stronger cyberdefense over the last year, however, there is still more work to be done to reach the desired cyberdefense maturity level.

Falck will establish a global approach to attraction, employer branding, recruitment and onboarding. This includes alignment and professionalisation of talent acquisition processes and tools, sharing of best practice and upskilling of personnel. Specific initiatives will be implemented to meet challenges in critical areas. Examples being campaigns targeting candidates with the best fit for the role, active use of social media to create awareness and pride, investigation of partnership opportunities and improved working conditions.

Falck’s data warehouse will together with the groupwide onboarding, engagement and exit surveys monitor and provide insights to managers on reasons for joining, staying or leaving Falck. Based on this, improvement actions will be initiated.

Falck will focus on further strengthening its risk-based cybersecurity framework and processes along with business continuity and recovery plans for defined threats and attacks. Full implementation of the cybersecurity fortification and recovery plan should be ensured, following defined deadlines for all included actions. Revision of the plan and deadlines and reprioritisation of its steps should be performed if necessary to secure feasibility and timely implementation.

Risk description

Constraints on passing on higher costs to customers

In recent years, costs for labour retention and attraction in the healthcare sector have increased due to growing demand and unfavourable macroeconomic conditions. Higher fuel prices and production costs with limited ability to pass this burden on to customers during times of high inflation have put additional pressure on profit margins. Given the increasing uncertainty at present with a potential global recession, this trend is very likely to continue and increase the pressure on operating margins.

Digital disruption

The healthcare sector is characterised by the rapid speed of innovation, digital transformation and high competition driven by introduced compelling digital platforms. Having automated processes, efficient IT platforms and required digital skills is pivotal for meeting competition in time with scalable business models and innovative services that win in the healthcare market.

Changes in government and regulatory policy

There is a risk of failure to anticipate or influence changes in the governmental and regulatory environment which may impact Falck’s customers and service delivery, altering the viability or profitability of the business. Falck’s business is subject to government and regulatory policy, including insurance and conduct rules such as minimum wage requirements, reimbursement mechanisms, changes to tax regimes and the interpretation of existing tax practices and pricing controls. The significant governmental and regulatory responses to the pandemic have shown that future legislation, regulation and government funding decisions could have a material impact on Falck.

Planned mitigating actions

A comprehensive approach to profit margin management will be developed, including commercial actions such as pricing and internal cost reduction efforts. Clear objectives (timing and quantities) will be set based on robust analytics. Analyses should include people, financial and operational data to develop opportunity hypotheses and preliminary targets.

Development of a technology modernisation roadmap and comprehensive plans for further digitalisation with investment in upskilling employees continues to be in focus. Falck’s business strategy will be adapted to enable tapping into medical science (segment) or market opportunities that are feasible and/or affordable for the organisation. Further investments in new products or services should be evaluated based on cost-return analysis and wider access in societies/locations targeted.

Falck will continue to closely monitor its long term contract pipeline to ensure timely action on identified commercial opportunities. Also, potential strategic implications on Falck’s businesses deriving from any future changes in government or policy regulation should be timely evaluated to allow for adequate changes to the strategy and business model.

Top-six risks identified for 2023

Corporate governance

The work on corporate governance is ongoing for the Board of Directors and the Executive Management, since Falck is committed to adhering to current legislation and recommendations issued by the Danish Committee on Corporate Governance, but also to what is considered prudent corporate governance principles.

with the Chair as independent. Also, the composition of the Audit Committee was changed during 2022. As a result, the Audit Committee has an equal distribution of independent and dependent members. In consequence, the Committee is not considered to hold a majority of independent members. Falck will be working towards a majority of the members of the Audit Committee being independent.

Governance structure, board composition and responsibilities

At present, the Board of Directors has nine members. Six members are elected by the shareholders and three are elected by the employees in Denmark. Shareholder-elected board members serve for terms of one year and are up for election at the following annual general meeting, whereas employee-elected members are elected for terms of four years.

At the board meeting on 27 January 2022, Niels Smedegaard was elected new Chair of Falck’s Board of Directors. Niels Smedegaard has been a member of Falck’s Board of Directors since 2016 and is considered independent. He replaced Peter Schütze, who thereafter continued to contribute as a member of the Board of Directors after having acted as Chair since 2015.

Governance structure

Consequently, at least once a year, the Board of Directors reviews the Group’s corporate governance framework and policies in relation to the Group’s activities, business environment and the Danish Recommendations on Corporate Governance.

Falck reports on its corporate governance compliance in accordance with the “comply or explain” principle. Since 2020, Falck has issued an analysis on an annual basis, which is available on the corporate website (www.falck.com/about-us/corporategovernance).

In the Comply or explain analysis from 2021, it was noted that Falck adhered to the Danish Recommendations on Corporate Governance apart from one recommendation only. Falck made a commitment to also meet this recommendation which states that the majority of the Remuneration and Nomination Committee members should be independent. This was achieved during 2022 with two out of the three members being independent and

In accordance with Danish legislation, Falck has a two-tier management system comprising the Board of Directors and the Executive Committee. There are no overlapping members in these two bodies, and members retiring from the Executive Committee cannot join the Board of Directors immediately hereafter.

The shareholders have the ultimate authority of Falck and they may exercise their rights by passing resolutions at the Annual General Meeting, the supreme governing body of Falck. At the Annual General Meeting, the shareholders elect members to the Board of Directors and appoint the independent auditor.

The Board of Directors is responsible for the overall management and strategic direction of the Group and appoints the members of the Executive Committee. The Board of Directors guides and supervises Falck’s activities, development, management and organisation. The Board of Directors acts in compliance with applicable legislation and meets at least seven times a year or as required by special circumstances.

The Board of Directors has established the Audit Committee and the Remuneration and Nomination Committee. These two committees are responsible for preparing decisions and recommendations for consideration and approval by the Board of Directors. The Executive Committee is responsible for the day-to-day management. The Executive Management team undertakes leadership of the day-to-day operations of the business areas and global functions.

The change of Chair came as Falck had defined and subsequently progressed well on its business strategy towards 2025.

The most recent election of employee representatives for the Board of Directors for the 2021-2025 term was held in March 2021. The employee representatives consist of Vagn Flink Møller Pedersen, Stefan Fyhn Gregersen, and Christian Jesper Engvad Madsen. The employee representative Jacob Bonne Guldberg resigned on 15 May 2022 and was replaced by elected alternate Christian Jesper Engvad Madsen.

Lundbeckfonden is represented on the Board of Directors by Lene Skole (Deputy Chair) and Peter Schütze while KIRKBI is represented by Thomas Lau Schleicher. The other three shareholder-elected members are considered independent whereas none of the employee-elected members are considered independent as defined by the Danish Recommendations on Corporate Governance.

Both the Board of Directors and the Executive Committee strive to ensure transparency and accountability by building trusting relationships with shareholders, customers, suppliers, employees and the local communities in which Falck operates.

The Executive Committee and Executive Management team

The Executive Committee is responsible for the day-to-day management and operation of Falck. This is conducted in accordance with the guidelines and recommendations as set out by the Board of Directors and with

focus on developing and implementing strategies and significant initiatives. Moreover, the Executive Committee is responsible for ensuring that the Board of Directors is informed of all material matters and that proposals and recommendations concerning the Group’s overall strategy and objectives are submitted to the Board of Directors. The Executive Committee consists of the Group CEO and the Group CFO. On 31 March 2022, Tor Magne Lønnum stepped down as Group CFO to take up a position outside Falck. Maarit Pokkinen served as interim Group CFO from 1 April until 30 June after which Christian Baltzer assumed the role as Group CFO.

The Executive Committee has established an Executive Management team to undertake leadership of the day-to-day management. In addition to the Executive Committee members, the Executive Management team consists of the EVP Consumer and Technical services, the SVP Employee and Labour Market services, the SVP Ambulance US, the SVP Ambulance Europe and Fire, the SVP Community Health services, Latam, the SVP Commercial, the SVP Global People & Culture and the SVP Corporate Development and Affairs.

Evaluation of the Board of Directors

Like previous years, the Board of Directors has conducted an annual evaluation of the effectiveness of the Board of Directors, the processes supporting its work, individual board members’ contributions, the Chair’s performance and its interaction with the Executive Committee.

The quantitative evaluations on these areas are based on a collective assessment as well as self-assessments. Moreover, the evaluation included the individual competencies of the board members. The assessment has been carried out by an external company to assure anonymity, which is also part of the Danish Recommendations on Corporate Governance. Each board member and member of the Executive Committee have responded to an online questionnaire.

As it has been practised for several years, the board evaluation has been presented and discussed collectively in the Board of Directors, and the Chair has provided each board member with feedback.

The board evaluation for 2022 resulted in a total score of 9.85 on a scale from 1 – 10, and this level is almost identical to the score in 2021, which was 9.84. This is a very high score on performance, taking into consideration that the average is around 8 in an external industry benchmark.

The board evaluation reveals that there is a high level of trust with the board members to the performance of the Executive Management and the collaboration. In this regard, there was a high overall assessment in the view that the Board of Directors works with a strong commitment to ESG and focus on ensuring progress.

The board evaluation has also highlighted some improvement areas. One is to turn more attention and work towards discussions around business development

and performance – and somewhat less upon compliance. There is also a need to strengthen attention towards risk areas such as IT and cyber risks.

From the board discussions of the evaluation in 2022, it has been decided to focus on the below key areas in 2023:

• Succession of key positions with internal talent

• Building of board competencies within digitalisation and healthcare

• Assess the remuneration model

• Gender diversity and inclusion

Board competencies and diversity

The composition of the Board of Directors must be in such a way that the competencies of its members combined enable it to inspire, progress and oversee the development of Falck. All members of the Board of Directors hold equal rights and obligations. The Board of Directors believes that members should be chosen based on their overall competencies and recognises the importance and beneficial effect of board diversity with respect to experience, cultural and educational backgrounds, and gender.1

In 2022, the Board of Directors identified a range of competencies that are deemed important for ensuring continued progress of Falck. These are:

• C-level experience

• Strategic planning

• ESG and Corporate Governance

• Customer relation management

• M&A

• Industry-relevant experience

• Contract-based business models

• Subscription-based business models

• Core market insigths

• Organisational development

• Digitalisation

• Technology innovation

• Risk management

Special competencies required from employee-elected members of the Board of Directors are:

• Company knowledge

• Balancing employee and business perspectives

• Employee engagement

• Internal communication

Board activities

The Board of Directors held 12 ordinary or extraordinary board meetings as well as a strategy seminar in 2022. The most significant activities were related to:

• Continued development of Falck’s strategy, Care for more ‘25

• Divestment of Falck’s Roadside Assistance business in Sweden, Norway, Finland, Estonia and Lithuania

• Integration of Frisk Gruppen

• Sustainability strategy and the Science Based Targets initiative

• Development of a global operating model for the ambulance business

• Start-up of the ambulance contract in San Diego

• Initiative to develop a full-potential strategy planning for Falck.

The regular activities of the Board of Directors included discussions and approvals of:

• Financials: Annual and interim reports, including sustainability reporting, remuneration report, forecast and targets, ESG-linked syndicated refinancing agreement

• Strategic and commercial topics: Acquisitions, divestments, tenders, business updates

• People and Culture: Engagement survey results and actions, succession planning

• Policies for the following subject areas: Tax, Insurance, Risk, Executive Hiring, Succession Planning, M&A, Diversity and Inclusion, Remuneration, Communication, Investor Relations, Sustainability, Human Rights, Data Ethics, Treasury, Whistle-blower, and also on the provision of non-audit services by the independent auditors

• Other main topics: Recommendations on Corporate Governance, Health and Safety, Risks, Whistleblower and Compliance reporting

There was a strong attendance to the Board of Directors' meetings from its members, evidenced by the fact that all members had an attendance rate well above 90%.

Internal controls

The Board of Directors and the Audit Committee assume overall responsibility for overseeing the internal control environment and the effectiveness of internal controls. The Executive Committee leads the implementation and monitoring of an appropriate internal control environment.

The internal control environment has been upheld by an independent Internal Audit, Internal Financial Controls, Quality Assurance and ISO Audit.

Over the past years, Falck has invested in improvements to controls, compliance and processes. The Board of Directors and the Audit Committee acknowledged the improvement in the control environment and decided in November 2022 to discontinue the independent audit function appointed by the Audit Committee. The independent internal audit function was established by the Audit Committee in 2018.

Remuneration

Remuneration of the members of the Board of Directors and the Executive Committee is governed by Falck’s Remuneration Policy, which complies with the Danish Recommendations on Corporate Governance. The Remuneration Policy and the annual Remuneration Report are both available at www.falck.com/aboutus/corporategovernance/remuneration.

Data Ethics

Falck’s Data Ethics Policy was developed and approved by the Board of Directors in 2021. It is based on the basic principles of data ethics set out by the think tank, DataEthics, and covers the following areas:

• Purpose and usage: Human interests prevail over commercial interests. The data that we are legally required to store are held for the benefit of the individual

• Individual data control: Individuals should have primary control over the usage of their own data

• Transparency: We strive to be transparent when we communicate purposes and interests of data usage to individuals via privacy notices and policies

• Accountability and governance: Efforts are made to reduce the risks to individuals and to mitigate undesirable social and ethical implications.

A working group with representatives from global functions and business segments has been established as an advisory board to local and global managements on data ethical matters.

The global Data Ethics Policy for 2022, cf. section 99d, is available at www.falck.com/ data-protection.

Board committees

The Board of Directors has established two committees to support its decision-making: An Audit Committee and a Remuneration and Nomination Committee.

The Audit Committee assists the Board of Directors in monitoring Falck’s financial reporting process, accounting policies, statutory audits of annual reports, assessment of quarterly reports, effectiveness of internal control and risk management systems, tax and treasury governance, compliance and whistle-blower systems, ESG progress, IT security, and the independence of the external auditors. The Audit Committee makes recommendations on these topics to the Board of Directors and, on behalf of the Board of Directors, follows up on the implementation of initiatives taken by the Executive Committee. The Board of Directors appoints the Audit Committee members from among its members for one-year terms. One member is designated as Committee Chair.

The Committee’s work and responsibilities are established in a charter.

Member composition and meetings

In March 2022, Lene Skole and Lars Frederiksen were reappointed, while Peter Schütze and Dorthe Mikkelsen were appointed as new members of the Audit Committee. Peter Schütze was further appointed as new Chair of the Audit Committee. The Audit Committee meets at least four times a year. Altogether, the Audit Committee held six meetings during 2022 and there was a high attendance rate.

Most significant activities

The most significant activities of the Audit Committee during 2022 were:

• Recommendation for approval of the annual report 2021 and the interim reports during 2022 as well as pursuing an integrated financial and sustainability reporting in the annual report 2022

• Discussion of future and likely requirements in terms of control and assurance of sustainability reporting

• Recommendations delivered related to audit and compliance, IT and cybersecurity, enterprise risks and the refinancing agreement linked to selected sustainability KPIs

The Remuneration and Nomination Committee assists the Board of Directors in overseeing the remuneration of members of the Board of Directors, members of board committees and members of the Executive Committee, including the determination of remuneration levels and incentive programmes. In addition, the Remuneration and Nomination Committee is responsible for the Remuneration Report and Remuneration Policy, including the general guidelines governing incentive programmes for members of the Executive Committee.

The Remuneration and Nomination Committee is responsible for assisting the Board of Directors in performing its duties in terms of ensuring that the Board of Directors and the Executive Committee always have the necessary professional competencies and experience, and that they both have an appropriate number of members, for nominating members to the Board of Directors and the Executive Committee, and for regularly reviewing the performance of the Board of Directors and the Executive Committee.

Remuneration and Nomination Committee members are appointed by the Board of Directors from among its members for one-year terms. The Committee’s work and responsibilities are established in a charter.

Member composition and meetings

In March 2022, Dorthe Mikkelsen and Lene Skole were reappointed to the Remuneration and Nomination Committee. Niels Smedegaard was appointed as new Chair of the Remuneration and Nomination Committee. The Remuneration and Nomination Committee meets at least twice a year. Five meetings were held in the Committee during 2022 and there was a high attendance rate recorded.

Most significant activities

The most significant activities of the Remuneration and Nomination Committee during 2022 were:

• Peer-group and benchmark of the Board of Directors and Executive Committee

• Succession Planning

• Two new policies; Executive Hiring Policy and Succession Planning Policy

• Short-term and long-term incentives

• Discussions on and recommendation for approval of remuneration of the Executive Committee and the Board of Directors

• Definition of competence profiles for the Board of Directors and Executive Committee

The Remuneration and Nomination Committee

The Audit Committee

Meeting attendance 2022

Lau Schleicher

Fyhn Gregersen (E)

Jesper Engvad Madsen (E) 4

Flink Møller Pedersen (E)

Bonne Guldberg (E)4

(E) Elected by employees

1. Independent

2. Stepped down as member of the Audit Committee in March 2022

3. Stepped down as member of Remuneration and Nomination Committee in March 2022

4. In 2022, the Employee representative Jacob Bonne Guldberg resigned on 15 May 2022 and was replaced by elected alternate Christian Jesper Engvad Madsen

Board competencies

C-level experience

Strategic planning

ESG and Corporate

Governance

Customer relation management

M&A

Industry-relevant experience

Contract-based business models

Subscription-based business models

Core market insigths

Organisational development

Digitalisation

Technology innovation

Risk management

Company knowledge

Balancing perspectives

Employee engagement

C-level experience from major international companies

Experience from strategic planning, development and implementation activities

Experience within environmental, social and corporate governance (ESG) implementation

Experience with customer relation mgmt. incl. sales, marketing and branding

M&A/divestment experience

Experience from the healthcare or emergency services industry

Knowledge and competencies around contract-based business

Knowledge and competencies around subscription-based business

Knowledge and competencies around Falck’s main markets, especially the US

Profound experience within organisational dev., incl. leadership and talent dev., change management and cultural transformations

Digital competencies to understand and support Falck’s digital efforts

Experience within implementation of innovative technologies

Risk management experience from a global company

Experience and broad knowledge of how the Falck Group conducts its business

Ability to balance Falck Group employee perspective and business perspective

Strong knowledge of what Falck Group employees are occupied with and pay attention to

Internal communication

Ability to advise on appropriate forms of communication between management and employees

The board members have evaluated their competencies within key areas on a scale 1-6, in which 4-6 indicates above average to outstanding. The table includes only competencies rated with a minimum of 4. The employee-elected board members have evaluated their competencies for the areas Company knowledge, Balancing perspectives, Employee engagement and Internal communication.

Niels Smedegaard Chair

Dorthe Mikkelsen

Christian Jesper Engvad Madsen (E)

Lene Skole Deputy Chair

Peter Schütze

Stefan Fyhn Gregersen (E)

Lars Frederiksen

Thomas Schleicher

Vagn Flink Møller Pedersen (E)