DIVERSITY POLICY OF KESKO CORPORATION’S BOARD OF DIRECTORS

Diversity is an essential component of Kesko’s success, the achievement of Kesko’s strategic objectives and good governance at Kesko. This diversity policy describes the objectives in the achievement of diversity in the operations and composition of Kesko Corporation’s Board of Directors.

Board size and election of its members

According to the Company’s Articles of Association, the term of office of a Board member is three (3) years, starting at the close of the General Meeting electing the member and expiring at the close of the third (3rd) Annual General Meeting after the election. According to the Articles of Association, Kesko's Board of Directors is composed of a minimum of five (5) and a maximum of eight (8) members. A sufficient number of Board members promotes the diversity of Board composition, as the areas of expertise and competence of the Board members are mutually complementary and the Board’s independence requirements are satisfied.

The Board members are elected by majority votes at the General Meeting based. The Board elects the Chairperson and the Deputy Chairperson from among its members for the whole term of office of the Board. In the preparation of a proposal for the Board composition, Kesko applies the practice in which a Shareholders' Nomination Committee prepares proposals to the General Meeting concerning Board members' fees and, as necessary, for the number of Board members and for the Board members.

Planning the Board composition

The composition of Kesko’s Board of Directors shall support Kesko’s current and future business operations. The Board members are appointed on their merits. One of the essential features in the Board composition is that the Board members’ educational backgrounds, experience, professional competences and age and gender distribution support Kesko’s business objectives and enable efficient Board work from Kesko’s point of view. The Board members shall also be able to devote a sufficient amount of time to Board work. Board members are recommended to hold Board memberships or high level positions in no more than four other publicly listed companies.

Kesko aims to achieve a balanced gender distribution in the composition of its Board of Directors. The composition of the Board shall reflect experience in both national and international business operations. The educational background of the Board members shall represent multiple disciplines and diversity. In addition, Kesko’s Board shall include members with strong experience in the trading sector and in-depth knowledge of the retailer business. The achievement of objectives is monitored annually and reported in the corporate governance statement.

(Approved in Kesko Corporation’s Board of Directors meeting on 25.10.2016 and updated on 17.12.2020 and 26.5.2021).

Monitoring the implementation of diversity policy objectives in 2020

In 2020, two of the seven Board members were women, in other words, the proportion of the gender with smaller representation on the Board was approximately 29%. The educational backgrounds and experience of the Board members represent multiple disciplines and diversity. Several Board members have experience in the trading sector and the principal occupation of three of the seven Board members is acting as a K-retailer. Several Board members also have experience in international business operations.

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