743700OX6HSVMCAHPB95-2025-12-31-0-en


		2

REPORT BY THE BOARD

OF DIRECTORS


Report by the Board of Directors ..................................	3
Operating environment ....................................................	3
Guidance 2026 ..................................................................	3
Outlook 2026 ....................................................................	3
Financial performance ......................................................	4
Segments ...........................................................................	6
Changes in Group composition .......................................	9
Key events during the financial year ...............................	9
Resolutions of the 2025 Annual General Meeting .........	9
Information contained in the notes to the financial statements .........................................................................	10
Corporate governance statement ...................................	10
Risk management ..............................................................	10
Potential risks and uncertainties .....................................	10
Proposal for profit distribution ........................................	11
Annual General Meeting ..................................................	11
Shares and securities markets .........................................	12
Analysis of shareholding ..................................................	13
Board authorities ...............................................................	15
Group’s key performance indicators ..............................	16
Calculation of performance indicators ...........................	17
Sustainability statement .................................................	21

This report is a translation of the Finnish original.


		3

REPORT BY THE BOARD OF DIRECTORS

Kesko is a Finnish listed trading sector company. Kesko has

approximately 1,700 stores engaged in chain operations in

Finland, Sweden, Norway, Denmark, Estonia, Latvia,

Lithuania and Poland.

Kesko Group's reportable segments consist of its business

divisions, namely the grocery trade, the building and

technical trade, and the car trade.

The Group's parent company, Kesko Corporation, is a

Finnish public limited company constituted in accordance

with the laws of Finland. The Company's business ID is

0109862-8, it is domiciled in Helsinki, Finland and its

registered address is PO Box 1, 00016 KESKO, Finland.

Together, Kesko and K-retailers form K Group, whose retail

sales (preliminary) totalled some €15.4 billion (0% VAT)

in 2025.

Operating environment

Identified trends impacting the operations of K Group are

related to global political and economic uncertainty,

consumer and business confidence and customer

behaviour, the impacts of urbanisation, as well as

population change. Convenience is emphasised in consumer

behaviour, and habits are changing quickly. In addition,

climate change and the green transition, digitalisation and

the possibilities of artificial intelligence all impact the

operating environment. Globalisation impacts supply

chains, and the importance of risk management grows.

The key opportunities and risks in the operating

environment relate to changes in the economic

environment, digital services and data‑driven management,

the geopolitical situation, sustainable sourcing and human

rights, and climate change. Emerging risks include human

rights risks related to the supply chain and evolving

sustainability legislation and regulation. Risks are described

in more detail in the ‘Significant risks and uncertainties’

section of this Report by the Board of Directors.

Guidance 2026

Kesko Group’s profit guidance is given for the year 2026, in

comparison with the year 2025. Kesko’s operating

environment is estimated to improve in 2026, but to still

remain somewhat challenging. Kesko’s comparable

operating profit is estimated to improve in 2026. Kesko

estimates that its 2026 comparable operating profit will

amount to €650–750 million. Key uncertainties impacting

Kesko’s outlook are developments in consumer confidence

and investment appetites, as well as geopolitical crises and

tensions.

Outlook 2026

The operating environment for Kesko is estimated to

improve in 2026 in all divisions and all operating countries.

Kesko’s comparable operating profit is also estimated to

improve in 2026 in all divisions and all operating countries.

In grocery trade, B2C trade is estimated to pick up and the

foodservice business to remain stable. In 2026, the

comparable operating margin for the grocery trade division

is estimated to stay clearly above 6% despite the

investments in price and the store site network. The

comparable operating profit for the grocery trade division is

estimated to improve in 2026 compared to 2025.

In building and technical trade, the cycle is expected to

improve moderately in 2026 from an exceptionally low

level. The comparable operating result for the building and

technical trade division is estimated to improve in 2026

compared to 2025 in all Kesko operating countries.

In the car trade market, new car sales are expected to

remain muted compared to long-term levels, but to

nonetheless grow compared to 2025. The net sales and

comparable operating profit for Kesko’s car trade division

are estimated to improve in 2026 compared to 2025.


		4

Financial performance

Net sales and profit in 2025


1–12/2025	Net sales, € million	Change, %	Change, comparable, %	Operating profit, comparable, € million	Change, € million
Grocery trade	6,447.4	+1.0	+1.0	418.1	-19.9
Building and home improvement trade	2,471.9	+14.4	+2.0	75.3	+12.7
Technical trade	2,285.4	+1.3	+1.1	89.4	-1.0
Kesko Senukai	-	-	-	19.5	-1.4
Building and technical trade, total	4,685.8	+7.7	+1.4	178.6	+9.4
Car trade	1,364.8	+12.9	+12.0	83.1	+13.8
Common functions and eliminations	-23.4	-4.5	-	-24.8	+1.5
Total	12,474.7	+4.7	+2.3	654.9	+4.8

Group net sales grew by 4.7%. In comparable terms, net

sales increased by 2.3%. Net sales increased in comparable

terms by 2.2% in Finland, while in the other operating

countries, net sales increased by 2.6%. The comparable

change % has been calculated in local currencies and

excluding the impact of acquisitions and divestments

completed.

Net sales for the grocery trade division increased by 1.0%.

Sales to K Group grocery store chains grew by 1.9%. Net

sales for Kespro’s foodservice business decreased by 0.3%.

Net sales for the building and technical trade division

increased by 7.7%, while in comparable terms, net sales

increased by 1.4%. Gradual recovery in the construction

cycle continued. The growth in building and technical trade

net sales was underpinned in particular by acquisitions. Net

sales for technical trade increased by 1.3%, while in

comparable terms, net sales increased by 1.1%. In building

and home improvement trade, net sales increased by 14.4%,

while in comparable terms, net sales increased by 2.0%. The

figures of the Danish building and home improvement trade

companies acquired have been consolidated into the

division’s figures as follows: Roslev Trælasthandel A/S as of

1 February 2025, CF Petersen & Søn A/S as of 1 May 2025,

and Tømmergaarden A/S as of 1 June 2025.

Net sales for the car trade division increased by 12.9%,

while in comparable terms net sales increased by 12.0%. Of

the car trade businesses, net sales increased in new cars,

used cars and services. Net sales for sports trade also

increased.

The Group’s comparable operating profit totalled

€654.9 million (€650.1 million), representing an increase of

€4.8 million. The comparable operating profit for the

grocery trade division decreased by €19.9 million, impacted

by the implementation of the price programme in K Group

grocery stores and a weak foodservice market. The

comparable operating profit for the building and technical

trade division increased by €9.4 million. The figure was

impacted by the gradual recovery in the construction cycle

and tight price competition in technical trade. Profitability in

building and home improvement trade was burdened by a

€5.7 million (€2.5 million) expense related to acquisitions,

recorded in the allocation of fair value. The share of result

from Kesko Senukai was down by €1.4 million. The

comparable operating profit for the car trade division

increased by €13.8 million. The comparable operating profit

for the car trade businesses increased by €13.1 million as

net sales grew. In sports trade, the comparable operating

profit increased by €0.7 million on the comparison period.


Items affecting comparability, € million	1–12/2025	1–12/2024
Operating profit, comparable	654.9	650.1
Items affecting comparability
+gains on disposal	+15.7	+11.4
-losses on disposal	-2.8	-1.6
-Impairment charges	-13.7	-40.0
+/- structural arrangements	-22.8	-40.4
Items affecting comparability, total	-23.6	-70.6
Operating profit	631.3	579.5


		5

The most significant items affecting comparability were

related to sales gains on properties, to the reorganisation of

technical trade in Sweden, including a €11.0 million write-

down of goodwill, and to structural arrangements. In the

comparison period, the most significant items affecting

comparability were related to a write-down of goodwill in

the Norwegian Byggmakker building and home

improvement trade chain, to the reorganisation of the K-

Rauta chain in Sweden, in which the Swedish building and

home improvement trade operations were concentrated

under the K-Bygg chain, to costs related to the

discontinuation of the Neste K chain, and to acquisitions.

K Group's (Kesko and the chain stores) retail and B2B sales

(0% VAT) totalled €15,401.7 million, representing an

increase of 2.2%. During the 12-month period that ended in

December 2025, the number of Finnish households

belonging to the K-Plussa loyalty scheme and using the K-

Plussa network totalled 2.7 million, with 3.4 million K-Plussa

loyalty card users.

Net finance costs, income tax and earnings

per share


	1–12/2025	1–12/2024
Net finance costs, € million	-125.4	-111.7
Interests on lease liabilities, € million	-89.4	-78.6
Profit before tax, comparable, € million	533.8	543.0
Profit before tax, € million	510.3	471.5
Income tax, € million	-105.5	-92.0
Earnings per share, comparable, €	1.07	1.11
Earnings per share, €	1.02	0.95
Equity per share, €	7.03	6.84

The increase in Group net finance costs was impacted by an

increase in the amount of interest-bearing debt and a rise in

interest expenses on lease liabilities. The share of result of

associates totalled €4.4 million (€3.8 million). The

comparable share of result of associates totalled €3.0

million (€3.8 million).

The Group’s effective tax rate was 20.7% (19.5% ).

The Group’s earnings per share increased compared to the

year before, but the comparable earnings per share

decreased.

Cash flow and financial position


€ million	1–12/2025	1–12/2024
Cash flow from operating activities	879.7	1,008.2
Cash flow from investing activities	-541.8	-597.5
Cash flow from financing activities	-644.7	-149.8


€ million	31.12.2025	31.12.2024
Liquid assets	166.2	488.1
Interest-bearing liabilities	3,572.6	3,396.3
Lease liabilities	2,097.5	2,051.0
Interest-bearing net debt excl. lease liabilities	1,308.9	857.2
Interest-bearing net debt/ EBITDA, excl. IFRS 16 impact	1.6	1.1
Gearing, %	120.5	106.3
Equity ratio, %	32.2	32.5

The Group’s cash flow from operating activities totalled

€879.7 million (€1,008.2 million), weakened by an increase

in working capital. A change in the Finnish Food Market

Act, which came into effect on 1 July 2025, led to shorter

payment periods, which is estimated to have weakened the

cash flow from operating activities by some €100 million in

the reporting period.

The Group’s cash flow from investing activities totalled

€-541.8 million (€-597.5 million), impacted by acquisitions

in Denmark, which had a total cash flow impact of €-156.8

million. Cash flow from investing activities was reduced by

proceeds of €102.1 million from the sale of properties and

other non-current assets.

The Group’s net debt excluding lease liabilities was

increased by a year-on-year decrease in cash flow from

operating activities, completed acquisitions, and

investments made in the store site network for grocery

trade and Onninen and K-Auto’s shared logistics centre.

Capital expenditure


€ million	1–12/2025	1–12/2024
Capital expenditure	735.7	675.9
Store sites	334.4	289.2
Acquisitions	185.8	172.9
IT	22.8	18.0
Other investments	192.8	195.8

Capital expenditure in store sites increased by €45.2 million

year-on-year. Capital expenditure in store sites include a

store property in Kaarina, where Kesko’s grocery trade has

long been the primary tenant, and a shopping centre

property in Vantaa. Capital expenditure in store sites in the

comparison period included store properties in Espoo and

Salo, where Kesko’s grocery trade has long been the

primary tenant.


		6

Other capital expenditure included an investment of

€40.4 million (€82.8 million) in the construction of Onninen

and K-Auto’s shared logistics centre in Hyvinkää, Finland,

completed in August. Capital expenditure also included the

acquisitions of the Danish builders’ merchants Roslev

Trælasthandel A/S (completed on 31 January 2025), CF

Petersen & Søn A/S (completed on 30 April 2025), and

Tømmergaarden A/S (completed on 28 May 2025). Capital

expenditure in the comparison period included the

acquisition of Davidsen Koncernen A/S, completed on 31

January 2024.

Segments

Grocery trade


	1–12/2025	1–12/2024
Net sales, € million	6,447.4	6,381.4
Operating profit, comparable, € million	418.1	438.0
Operating margin, comparable, %	6.5	6.9
Return on capital employed, comparable, %	14.1	16.0
Capital expenditure, € million	309.2	276.0
Average number of personnel converted into full-time employees	6,264	6,346

Net sales for the grocery trade division totalled

€6,447.4 million (€6,381.4 million), an increase of 1.0% .

Sales to K Group grocery store chains grew by 1.9%. Net


Net sales, € million	1–12/2025	1–12/2024	Change, %	Change, comparable, %
Sales to K Group grocery stores	4,616.4	4,529.3	+1.9	+1.9
K-Citymarket, non-food	604.1	602.6	+0.2	+0.2
Kespro	1,166.6	1,169.6	-0.3	-0.3
Others	60.3	79.8	-24.5	-25.3
Total	6,447.4	6,381.4	+1.0	+1.0

sales for Kespro’s foodservice business decreased by 0.3%.

The total grocery retail market in Finland (incl. VAT) is

estimated to have grown by approximately 2.5% (Finnish

Grocery Trade Association PTY), and retail prices are

estimated to have risen by some 2.1% (incl. VAT, Statistics

Finland). K Group's grocery sales grew by 2.1% (incl. VAT).

In January-December, K Group grocery stores lost market

share slightly, but the trend was very close to the market

trend. K Group grocery stores gained market share in July-

December by 0.2 percentage points, and in the final quarter

by 0.5 percentage points (PTY). Online grocery sales grew

by 7.9%, and accounted for approximately 3.9% of K

Group’s grocery sales (incl. VAT). All K Group grocery

store chains offer online grocery services. The number of K

Group stores offering online grocery services was 788, up

by 12 from the previous year. The total market for the

foodservice business is estimated to have decreased by

0.4% (PTY). Kespro’s market share is estimated to have

continued to grow.

The comparable operating profit for the grocery trade

division totalled €418.1 million (€438.0 million), down by

€19.9 million. The change in comparable operating profit

was impacted by the implementation of the price

programme in K Group grocery stores and a weak

foodservice market. Kespro’s comparable operating profit

totalled €72.1 million (€77.8 million). Operating profit for

the grocery trade division totalled €416.6 million (€420.9

million). Items affecting comparability totalled €-1.5 million

(€-17.2 million), and were mainly related to the

discontinuation of the Neste K chain and to gains on the

sale of properties.

Capital expenditure for the grocery trade division totalled

€309.2 million (€276.0 million). Capital expenditure in store

sites totalled €289.3 million (€255.2 million). Capital

expenditure in store sites included a store property in

Kaarina where Kesko’s grocery trade has long been the

primary tenant, a shopping centre property in Vantaa, and a

new store property in Lahti. Capital expenditure in store

sites in the comparison period included store properties in

Espoo and Salo, where Kesko’s grocery trade has long been

the primary tenant.


		7

Building and technical trade


	1–12/2025	1–12/2024
Net sales, € million	4,685.8	4,351.6
Building and home improvement trade	2,471.9	2,160.7
Technical trade	2,285.4	2,255.0
Operating profit, comparable, € million	178.6	169.1
Building and home improvement trade	75.3	62.6
Technical trade	89.4	90.5
Kesko Senukai	19.5	20.9
Operating margin, comparable, %	3.8	3.9
Building and home improvement trade	3.0	2.9
Technical trade	3.9	4.0
Return on capital employed, comparable, %	7.3	7.8
Capital expenditure, € million	279.7	293.7
Average number of personnel converted into full-time employees	6,853	6,538

Net sales for the building and technical trade division

increased by 7.7%. In comparable terms, net sales increased


Net sales, € million	1–12/2025	1–12/2024	Change, %	Change, comparable, %
Building and home improvement trade, Finland	899.6	888.4	+1.3	+1.3
K-Rauta, Sweden	0.2	101.6	-	-
K-Bygg, Sweden	343.2	277.0	+23.9	-3.3
Byggmakker, Norway	520.0	517.9	+0.4	+1.2
Davidsen, Denmark	709.0	379.8	+86.7	+9.7
Building and home improvement trade, total	2,471.9	2,160.7	+14.4	+2.0
Technical trade, Finland	1,121.7	1,132.1	-0.9	-0.9
Technical trade, Sweden	134.4	130.6	+2.9	-0.4
Technical trade, Norway	503.2	501.7	+0.3	+1.1
Technical trade, Baltics	153.5	127.4	+20.5	+20.5
Technical trade, Poland	378.4	368.1	+2.8	+1.2
Technical trade, total	2,285.4	2,255.0	+1.3	+1.1
Total	4,685.8	4,351.6	+7.7	+1.4
The reorganisation of the K-Rauta chain in Sweden was completed in December 2024. In October-November 2024, a total of 8 K-Rauta stores were transferred under the K-Bygg chain. The comparable change in K-Bygg net sales has been calculated in local currencies by adding the net sales of the transferred K-Rauta stores to the comparison period figures at dates corresponding to the change in store chains.

by 1.4% . The gradual recovery in the construction cycle

continued, but the pace of recovery was weaker than

expected especially in new housing construction. The

growth in the division’s net sales was underpinned in

particular by acquisitions. In technical trade, net sales

increased by 1.3%, while in comparable terms, net sales

increased by 1.1%. In building and home improvement trade,

net sales increased by 14.4% while in comparable terms, net

sales increased by 2.0%. The figures of the Danish building

and home improvement trade companies acquired have

been consolidated into the division’s figures as follows:

Roslev Trælasthandel A/S as of 1 February 2025, CF

Petersen & Søn A/S as of 1 May 2025, and Tømmergaarden

A/S as of 1 June 2025. Net sales development in euro terms

was increased by the strengthening of the Polish zloty and

Swedish krona, and decreased by the weakening of the

Norwegian krone against the euro.

In Finland, net sales for the building and technical trade

division totalled €1,966.4 million (€1,967.9 million), a

decrease of 0.1%. Net sales from international operations

totalled €2,719.4 million (€2,383.7 million), an increase of

14.1% thanks to the acquisitions carried out. In comparable

terms, net sales from international operations increased by

2.6%.

The comparable operating profit for the building and

technical trade division totalled €178.6 million (€169.1

million), and it increased by €9.4 million. The figure was

impacted by the slow recovery in the construction cycle and

tight price competition, especially in technical trade.

Profitability in building and home improvement trade was

burdened by a €5.7 million (€2.5 million) expense related to

acquisitions, recorded in the allocation of fair value.

Onninen’s comparable operating profit in Finland totalled

€57.0 million (€69.0 million). The share of result from

Kesko Senukai decreased by €1.4 million.

Operating profit for the building and technical trade division

totalled €159.2 million (€116.3 million). Items affecting

comparability totalled €-19.4 million (€-52.8 million). The

most significant items affecting comparability were related

to the reorganisation of technical trade in Sweden, including

a €11.0 million write-down of goodwill. The most significant

items affecting comparability in the comparison period were

related to a write-down of goodwill in the Norwegian

Byggmakker building and home improvement trade chain,

to the reorganisation of the K-Rauta chain in Sweden, in

which the Swedish building and home improvement trade

operations were concentrated in the K-Bygg chain, and to

acquisitions.


		8


Operating profit, comparable, € million	1–12/2025	1–12/2024
Building and home improvement trade, Finland	61.2	61.3
K-Rauta, Sweden	1.4	-3.2
K-Bygg, Sweden	-8.8	-1.5
Byggmakker, Norway	8.9	-3.5
Davidsen, Denmark	11.9	8.3
Building and home improvement trade, total	75.3	62.6
Technical trade, Finland	57.0	69.0
Technical trade, Sweden	-6.9	-2.7
Technical trade, Norway	19.7	8.2
Technical trade, Baltics	4.0	1.9
Technical trade, Poland	11.6	10.2
Technical trade, total	89.4	90.5
Total	178.6	169.1

Capital expenditure for the building and technical trade

division totalled €279.7 million (€293.7 million). Capital

expenditure included an investment of €40.4 million in the

construction of Onninen and K-Auto’s shared logistics

centre in Hyvinkää, Finland, completed in August 2025.

Capital expenditure also included the acquisitions of the

Danish builders’ merchants Roslev Trælasthandel A/S

(completed on 31 January 2025), CF Petersen & Søn A/S

(completed on 30 April 2025), and Tømmergaarden A/S

(completed on 28 May 2025). Capital expenditure in the

comparison period included the acquisition of the Danish

building and home improvement trade company Davidsen

Koncernen A/S, completed on 31 January 2024.

Car trade


	1–12/2025	1–12/2024
Net sales, € million	1,364.8	1,209.4
Car trade	1,196.2	1,040.9
Sports trade	168.8	168.7
Operating profit, comparable, € million	83.1	69.3
Car trade	74.8	61.7
Sports trade	8.3	7.6
Operating margin, comparable, %	6.1	5.7
Car trade	6.3	5.9
Sports trade	4.9	4.5
Return on capital employed, comparable, %	15.5	13.8
Capital expenditure, € million	125.0	89.0
Average number of personnel converted into full-time employees	1,638	1,556

Net sales for the car trade division increased by 12.9% ,

while in comparable terms, net sales increased by 12.0% . Of

the car trade businesses, net sales increased in new cars,

used cars and services. Net sales for sports trade also

increased.

The combined market performance of first registrations of

passenger cars and vans was -1.6% . The combined market

share of the Volkswagen, Audi, SEAT, CUPRA, Porsche and

Bentley passenger cars and Volkswagen vans imported by

Kesko’s car trade division was 17.3% (14.5%).

The comparable operating profit for the car trade division

totalled €83.1 million (€69.3 million). The comparable

operating profit for the car trade businesses increased by

€13.1 million, thanks to growth in net sales. In sports trade,

the comparable operating profit increased by €0.7 million

year-on-year.

Operating profit for the car trade division totalled €82.4

million (€69.3 million). Items affecting comparability

totalled €-0.7 million (€0.0 million).

Capital expenditure for the car trade division totalled

€125.0 million (€89.0 million).


Net sales, € million	1–12/2025	1–12/2024	Change, %	Change, comparable, %
Car trade	1,196.2	1,040.9	+14.9	+13.9
Sports trade	168.8	168.7	+0.1	+0.1
Total	1,364.8	1,209.4	+12.9	+12.0


		9

Changes in Group composition

Kesko’s Danish subsidiary Davidsen Koncernen A/S

acquired the full capital stocks of the Danish builders’

merchants Roslev Trælasthandel A/S on 31 January 2025,

CF Petersen & Søn A/S on 30 April 2025, and

Tømmergaarden A/S on 28 May 2025. Kesko Corporation’s

fully-owned subsidiary K-Market Oy merged with Kesko

Corporation on 31 October 2025.

Key events during the financial year

Kesko ranked as the world’s most sustainable company in

the ’Consumer Staples’ category on the 2025 ‘Global 100

Most Sustainable Corporations’ listing. (Investor news

release 22.1.2025)

Kesko announced in August 2024 that it would acquire the

Danish builders’ merchants Roslev Trælasthandel A/S,

CF Petersen & Søn A/S, and Tømmergaarden A/S. The

acquisition of Roslev was completed on 31 January 2025,

the acquisition of CF Petersen & Søn on 30 April 2025, and

the acquisition of Tømmergaarden on 28 May 2025.

(Investor news releases 14.8.2024, 31.1.2025, 30.4.2025

and 28.5.2025)

Kesko ranked the highest among European sector

companies on the first ever ‘Europe 50 Most Sustainable

Companies’ listing. The Canadian media and research

organisation Corporate Knights has been publishing a

ranking of the world’s 100 most sustainable corporations

for years, and for the first time now listed the 50 most

sustainable companies in Europe. In the listing, Kesko

ranked the highest in the ‘Grocery Stores’ peer group, and

19th overall. (Investor news release 9.6.2025)

The two largest shareholders in Kesko by voting rights on 1

September 2025 were K-Retailers' Association and

Ilmarinen Mutual Pension Insurance Company, both of

which used their right of nomination for Kesko’s

Shareholders' Nomination Committee. The members of

Kesko’s Shareholders’ Nomination Committee are Pauli

Jaakola, retailer, appointed by K-Retailers' Association,

Annika Ekman, EVP, Investments, appointed by Ilmarinen

Mutual Pension Insurance Company, and Esa Kiiskinen,

Chair of Kesko’s Board of Directors. At its organisational

meeting on 23 September 2025, the Committee elected

Pauli Jaakola as Committee Chair. (Stock exchange release

23.9.2025)

Minttu Sinisalo, M.Sc. (Econ.), was appointed as Executive

Vice President, HR and a member of Kesko’s Group

Management Board as of 1 March 2026. Sinisalo comes to

Kesko from Terveystalo, where she held the position of

Senior Vice President, HR. Before joining Terveystalo,

Sinisalo held various HR leadership positions at Finnair.

Kesko’s current Executive Vice President of HR Matti

Mettälä will retire, as per his agreement, on 1 March 2026.

To ensure a smooth transfer of duties, Minttu Sinisalo joined

Kesko on 1 January 2026. (Stock exchange release

30.9.2025)

According to a notification pursuant to Chapter 9, Section 5

of the Finnish Securities Markets Act, received by Kesko

Corporation on 14 November 2025, the combined holding

of K-ruokakauppiasyhdistys, K-Retailers' Association, and

the Foundation for Vocational Training in the Retail Trade

exceeded the threshold of 5% for shares and 20% for voting

rights in Kesko Corporation on 13 November 2025. After

the change in ownership interest, the combined holding of

K-ruokakauppiasyhdistys, K-Retailers' Association, and the

Foundation for Vocational Training in the Retail Trade was

7.72% of the shares and 20.01% of the voting rights in Kesko

on 13 November 2025. (Stock exchange release 14.11.2025)

Resolutions of the 2025 Annual

General Meeting

The Annual General Meeting of Kesko Corporation held on

24 March 2025 adopted the company’s financial statements

for 2024. The Annual General Meeting resolved to

distribute a dividend of €0.90 per share – based on the

adopted balance sheet for 2024 – on shares held outside

the company at the time of distribution. The remaining

distributable assets remain in equity. The dividend was paid

in four instalments: the record date of the first dividend

instalment of €0.23/share was 26 March 2025 and the pay

date 2 April 2025; the record date of the second dividend

instalment of €0.22/share was 15 July 2025 and the pay

date was 22 July 2025; the record date of the third dividend

instalment of €0.23/share was 14 October 2025 and the pay

date 21 October 2025; and the record date of the fourth

dividend instalment of €0.22/share was 13 January 2026

and the pay date 20 January 2026. The Board was

authorised to decide, if necessary, on new dividend

payment record dates and pay dates for the second, third

and/or fourth instalments, if the rules and statutes of the

Finnish book-entry system change or otherwise so require,

or if the payment of dividends is prevented by laws or

regulations applied.

The resolutions of the Annual General Meeting were

communicated in more detail in a stock exchange release

issued on 24 March 2025.


		10

Information contained in the notes to

the financial statements

Information on the Group’s personnel is disclosed in

Note 2.5.

Financial risks are presented in Note 4.3 and information on

financial instruments measured at fair value is disclosed in

Note 4.5.

Related party transactions are disclosed in Note 5.2 .

Information on disputes and legal and authority proceedings

is disclosed in Note 5.4.

Corporate governance statement

Kesko Corporation issues the Corporate Governance

Statement in compliance with the reporting requirements of

the Finnish Corporate Governance Code 2025 issued by the

Finnish Securities Market Association and effective as of 1

January 2025. Kesko Corporation issues the statement

separately from the Report by the Board of Directors.

Risk management

Risk management at Kesko is proactive and an integral part

of day-to-day management to assess and manage business-

related opportunities and risks.

Kesko’s divisions and common operations are responsible

for identifying, assessing, handling and managing risks

related to their operations, and they report on risks, risk

management responses and the results of those responses

to the Group risk management function. Members of the

Group Management Board are responsible for the effective

and efficient implementation of internal control and risk

management in their respective areas of responsibility.

A risk management function independent of businesses is

responsible for providing a framework and guidance for

internal control and risk management, and it supports,

coordinates and supervises risk management

implementation in Kesko Group. The Chief Audit and Risk

Officer reports functionally to the Chair of the Audit

Committee and administratively to Kesko’s President and

CEO on matters related to internal audit, and to the

Group’s Chief Financial Officer on matters related to risk

management. The Risk Management Steering Group

headed by the Chief Financial Officer is responsible for

establishing the Group’s overview of the risk situation. The

President and CEO is responsible for the effectiveness and

efficiency of the Group’s risk management, and approves

Group risk reports before they are reviewed by the Board of

Directors. Kesko’s Board of Directors monitors and

assesses the effectiveness of risk management and

supervises the assessment of risks related to the company’s

strategy and operations and their management, aided by

the Audit Committee.

The Group's most significant risks and uncertainties, as well

as material changes in and management responses to them,

including indicators, are reported to Kesko Board's Audit

Committee quarterly in connection with the review of

interim reports, the half-year financial report, and the

financial statements. The Audit Committee Chair reports on

risk management to the Board as part of Audit Committee

reporting. The most significant risks and uncertainties and

emerging risks are reported to the market by the Board in

the Report by the Board of Directors, and any material

changes in them in the interim reports and the half-year

financial report.

Potential risks and uncertainties

Consumer confidence and corporate

investments

Weak consumer confidence and corporate investment

appetites could impact demand in all operating countries.

Low demand, a decrease in sales, and price competition

could increase margin and cost pressures in all divisions.

Geopolitical and supply chain risks

Instability in the international operating environment,

changes in trade and economic policy, and potential

disruptions in supply chains could impact product

availability and business continuity.

Implementation of strategic projects and

changes

Challenges in implementing growth strategies, acquisitions,

or changes in business models could impact the company’s

ability to achieve its objectives.

Strengthening of market shares

Tightening price competition and a decrease in market

shares in different businesses and operating countries could

weaken net sales and profit.

Store sites and properties

Risks related to the upkeep, development and occupancy

rates of store sites and properties could impact business

profitability.


		11

Financing and cash flow

Growing financing costs combined with potentially

weakening cash flow from operating activities could impact

business profitability and the company’s ability to invest.

Cybersecurity and data protection risks

Cyber-attacks and data leaks could result in business

disruptions, loss of data, and reputational damage.

Business disruptions

Events such as a major disturbance in a logistics centre

could result in extensive interruptions in deliveries and

financial loss.

Regulations and legislation

Changes in national and international regulations, for

example restrictions related to private label products or

new sustainability requirements, could impact the operating

conditions for business and profitability.

Product and food safety

Serious deviations in product or food safety could result in

the recall of products, financial loss, and reputational

damage.

Sustainability and climate risks

Risks related to climate change, and environmental and

social responsibility and the fulfilment of requirements

related to these could impact business continuity and

reputation.

Reporting to the capital markets

Tightening of requirements for financial reporting and

sustainability reporting will increase requirements for data

collection and reporting accuracy.

Proposal for profit distribution

The Board of Directors of Kesko Corporation proposes to

the Annual General Meeting to be held on 26 March 2026

that a dividend of €0.90 per share be paid for the year 2025

based on the adopted balance sheet on shares held outside

the company at the date of dividend distribution. The

remaining distributable assets will remain in equity. The

Board proposes that the dividend be paid in four

instalments.

The first instalment of €0.23 per share is to be paid to

shareholders registered in the company's register of

shareholders kept by Euroclear Finland Ltd on the

instalment’s record date 30 March 2026. The Board

proposes that the dividend instalment pay date be

8 April 2026.

The second instalment of €0.22 per share is to be paid to

shareholders registered in the company's register of

shareholders kept by Euroclear Finland Ltd on the

instalment’s record date 16 July 2026. The Board proposes

that the dividend instalment pay date be 23 July 2026.

The third instalment of €0.23 per share is to be paid to

shareholders registered in the company's register of

shareholders kept by Euroclear Finland Ltd on the

instalment’s record date 15 October 2026. The Board

proposes that the dividend instalment pay date be

22 October 2026.

The fourth instalment of €0.22 per share is to be paid to

shareholders registered in the company's register of

shareholders kept by Euroclear Finland Ltd on the

instalment’s record date 14 January 2027. The Board

proposes that the dividend instalment pay date be

21 January 2027.

The Board proposes that it be authorised to decide, if

necessary, on new dividend payment record dates and pay

dates for one or more dividend instalments, if the rules and

statutes of the Finnish book-entry system change or

otherwise so require, or if the payment of dividends is

prevented by laws or regulations applied.

As at the date of the proposal for the distribution of profit,

4 February 2026, a total of 398,118,827 shares were held

outside the company, and the corresponding total amount

of dividends is €358,306,944.30.

Kesko Corporation's distributable assets total

€1,547,000,994.36, of which profit for the financial year is

€363,101,477.81.

Annual General Meeting

The Board of Directors has decided that Kesko’s Annual

General Meeting will be held on 26 March 2026 at 1.00 pm

(EET). Kesko Corporation will publish a notice of the

General Meeting on its website and as a stock exchange

release on 5 February 2026.


		12

Shares and securities markets

At the end of 2025, the total number of shares in Kesko Corporation was 400,079,008 , of

which 126,948,028 or 31.7% , were A shares, and 273,130,980 or 68.3% , were B shares. On 31

December 2025, Kesko Corporation held 1,960,181 of its own B shares as treasury shares.

These treasury shares accounted for 0.72% of the total number of B shares, 0.49% of the

total number of shares, and 0.13% of the votes attached to all shares in the company. The

total number of votes attached to all shares was 1,542,611,260. Each A share carries ten (10)

votes and each B share one (1) vote. The company cannot vote with own shares held by it as

treasury shares and no dividend is paid on such shares. At the end of 2025 , Kesko

Corporation's share capital was €197,282,584.

The price of a Kesko A share quoted on Nasdaq Helsinki was €18.06 at the end of 2024 and

€19.25 at the end of 2025, representing an increase of 6.6%. Meanwhile, the price of a

Kesko B share was €18.18 at the end of 2024 and €19.26 at the end of 2025, representing an

increase of 5.9%. In 2025, the highest price for an A share was €21.05 and the lowest €17.18,

while the highest price for a B share was €21.46 and the lowest €17.14. The Nasdaq Helsinki

All-Share index (OMX Helsinki) was up by 30.2% and the weighted OMX Helsinki Cap index

up by 29.7% in 2025. The Retail Sector Index was down by 2.0% .

The market capitalisation of Kesko’s A shares was €2,444 million at the end of 2025, while

the market capitalisation of Kesko’s B shares was €5,223 million, excluding the shares held by

the parent company as treasury shares. The combined market capitalisation of the A and B

shares was €7,666 million, up by €447 million compared to the end of 2024.

In 2025, a total of 5.1 million Kesko A shares were traded on Nasdaq Helsinki. The exchange

value of the A shares was €97.5 million. Meanwhile, 127.9 million B shares were traded, for an

exchange value of €2,433.9 million. Nasdaq Helsinki accounted for over 96% of the trading

on Kesko’s A and B shares. Kesko shares were also traded on multilateral trading facilities,

the most significant of which were Turquoise and BATS (source: Euroland).

At the end of 2025, the number of registered shareholders was 123,946. At the end of 2025,

foreign ownership of all shares stood at 31.6%, and foreign ownership of B shares 45.5%.

Share performance turnover


		2023	2024	2025
Share price as at 31 Dec.
A share	€	18.02	18.06	19.25
B share	€	17.93	18.18	19.26
Average share price
A share	€	18.47	17.80	18.96
B share	€	18.49	17.56	19.03
Market capitalisation as at 31 Dec., A share	€ million	2,287.6	2,292.7	2,443.7
Market capitalisation as at 31 Dec., B share	€ million	4,855.8	4,926.9	5,222.7
Turnover
A share	Million pcs	6	5	5
B share	Million pcs	143	139	128
Relative turnover rate
A share	%	4.4	4.1	4.0
B share	%	52.3	50.5	46.7
Diluted average number of shares	Thousand pcs	397,706	397,922	398,084


		13

Analysis of shareholding

Analysis of shareholding by shareholder type as at 31 Dec. 2025


All shares	Number of shares, pcs	Percentage of all shares, %
Nominee-registered and non-Finnish holders	126,377,951	31.59
Households	106,371,591	26.59
Non-financial corporations and housing corporations	95,812,954	23.95
General government*	34,716,861	8.68
Non-profit institutions serving households**	21,779,044	5.44
Financial and insurance corporations	15,020,607	3.75
Total	400,079,008	100.00


A shares	Number of shares, pcs	Percentage of A shares, %	Percentage of all shares, %
Non-financial corporations and housing corporations	74,835,733	58.95	18.71
Households	23,825,625	18.77	5.96
General government*	14,169,777	11.16	3.54
Non-profit institutions serving households**	11,557,426	9.10	2.89
Nominee-registered and non-Finnish holders	2,165,368	1.71	0.54
Financial and insurance corporations	394,099	0.31	0.10
Total	126,948,028	100.00	31.73


B shares	Number of shares, pcs	Percentage of B shares, %	Percentage of all shares, %
Nominee-registered and non-Finnish holders	124,212,583	45.48	31.05
Households	82,545,966	30.22	20.63
Non-financial corporations and housing corporations	20,977,221	7.68	5.24
General government*	20,547,084	7.52	5.14
Financial and insurance corporations	14,626,508	5.36	3.66
Non-profit institutions serving households**	10,221,618	3.74	2.55
Total	273,130,980	100.00	68.27
* General government, for example, municipalities, the provincial administration of Åland, authorised pension providers and social security funds ** Non-profit institutions, for example, foundations awarding scholarships, organisations safeguarding certain interests and various charitable associations

Analysis of shareholding by number of shares as at 31 Dec. 2025


All shares Number of shares	Number of shareholders, pcs	Percentage of share- holders, %	Share total, pcs	Percentage of shares, %
1−100	54,155	43.69	2,173,083	0.54
101−500	37,277	30.08	9,493,313	2.37
501−1,000	11,837	9.55	8,830,691	2.21
1,001−5,000	15,295	12.34	34,651,638	8.66
5,001−10,000	2,693	2.17	19,137,008	4.78
10,001−50,000	2,237	1.80	45,179,918	11.29
50,001−100,000	228	0.18	15,733,361	3.93
100,001−500,000	183	0.15	35,678,922	8.92
500,001−	41	0.03	229,201,074	57.29
Total	123,946	100.00	400,079,008	100.00


		14


A shares Number of shares	Number of shareholders, pcs	Percentage of A share- holders, %	A share total, pcs	Percentage of A shares, %
1−100	17,626	56.25	613,578	0.48
101−500	7,374	23.53	1,793,033	1.41
501−1,000	1,795	5.73	1,336,688	1.05
1,001−5,000	2,713	8.66	6,903,083	5.44
5,001−10,000	745	2.38	5,377,192	4.24
10,001−50,000	852	2.72	17,769,053	14.00
50,001−100,000	120	0.38	8,577,279	6.76
100,001−500,000	97	0.31	19,182,162	15.11
500,001−	12	0.04	65,395,960	51.51
Total	31,334	100.00	126,948,028	100.00


B shares Number of shares	Number of shareholders, pcs	Percentage of B share- holders, %	B share total, pcs	Percentage of B shares, %
1−100	40,468	40.58	1,701,292	0.62
101−500	31,635	31.72	8,187,581	3.00
501−1,000	10,600	10.63	7,925,378	2.90
1,001−5,000	13,302	13.34	29,555,576	10.82
5,001−10,000	2,069	2.07	14,631,246	5.36
10,001−50,000	1,419	1.42	27,273,985	9.99
50,001−100,000	112	0.11	7,617,383	2.79
100,001−500,000	88	0.09	16,991,001	6.22
500,001−	26	0.03	159,247,538	58.30
Total	99,719	100.00	273,130,980	100.00

10 largest shareholders by number of shares held

as at 31 Dec. 2025


		Number of shares, pcs	Percentage of shares, %	Number of votes	Percentage of votes, %
1.	K-Retailers' Association	22,318,567	5.58	223,185,670	14.47
2.	Ilmarinen Mutual Pension Insurance Company	14,188,000	3.55	138,028,000	8.95
3.	Vähittäiskaupan Takaus Oy	13,195,008	3.30	131,950,080	8.55
4.	Varma Mutual Pension Insurance Company	8,039,873	2.01	8,039,873	0.52
5.	Elo Mutual Pension Insurance company	6,559,725	1.64	10,211,250	0.66
6.	Foundation for Vocational Training in the Retail Trade	5,889,883	1.47	58,898,830	3.82
7.	The State Pension Fund	3,500,000	0.87	3,500,000	0.23
8.	K-Food Retailers' Club	2,710,442	0.68	27,104,420	1.76
9.	Heimo Välinen Oy	2,000,000	0.50	20,000,000	1.30
10.	Oy The English Tearoom Ab	2,000,000	0.50	2,000,000	0.13

Table above includes registered shareholders. The table does not contain shares held by

Kesko Corporation, amounting to 1,960,181 on 31 December 2025.

Nominee-registered shareholder BlackRock, Inc held 5,43% of shares and 1.41% of votes in

Kesko Corporation on 31 December 2025 (stock exchange release 3 July 2025).


		15

10 largest shareholders by number of votes as at 31.12.2025


		Number of shares, pcs	Percentage of shares, %	Number of votes	Percentage of votes, %
1.	K-Retailers' Association	22,318,567	5.58	223,185,670	14.47
2.	Ilmarinen Mutual Pension Insurance Company	14,188,000	3.55	138,028,000	8.95
3.	Vähittäiskaupan Takaus Oy	13,195,008	3.30	131,950,080	8.55
4.	Foundation for Vocational Training in the Retail Trade	5,889,883	1.47	58,898,830	3.82
5.	K-Food Retailers' Club	2,710,442	0.68	27,104,420	1.76
6.	Heimo Välinen Oy	2,000,000	0.50	20,000,000	1.30
7.	Food Paradise Oy	1,444,072	0.36	14,440,720	0.94
8.	Elo Mutual Pension Insurance company	6,559,725	1.64	10,211,250	0.66
9.	Varma Mutual Pension Insurance Company	8,039,873	2.01	8,039,873	0.52
10.	Pokela Oy Iso Omena	793,154	0.20	7,926,554	0.51

Management's shareholdings

At the end of December 2025, Kesko Corporation's Board members, the President and CEO

and the corporations controlled by them held 774,910 Kesko Corporation A shares and

396,793 Kesko Corporation B shares, i.e. a total of 1,171,703 shares, which represents 0.29%

of the total number of shares and 0.53% of votes carried by all shares of the Company.

At 31 December 2025 the President and CEO held 254,443 Kesko Corporation B shares,

which represented 0.06% of the total number of shares and 0.02% of votes carried by all

shares of the Company. At 31 December 2025, the Group Management Board including the

President and CEO held 2,824 Kesko Corporation A shares and 635,757 Kesko Corporation B

shares, which represented 0.16% of the total number of shares and 0.04% of votes carried by

all shares of the Company.

Board authorities

Kesko has a share-based commitment and incentive scheme. To implement the scheme,

Kesko’s Board of Directors may decide, within the share issue authorisations granted by the

company’s General Meeting, to transfer Kesko B shares held by the company as treasury

shares. In 2025 , Kesko Corporation transferred 156,490 Kesko B shares held as treasury

shares to members of management and other key persons in the company, while a total of

1,205 B shares were returned to Kesko in accordance with the terms and conditions of

Kesko's share award plans. Kesko issued related stock exchange releases on 12 March 2025,

30 April 2025 and 18 September 2025. Kesko issued a stock exchange release on 5 February

2025 regarding the most recent share-based commitment and incentive plans. In addition,

Kesko transferred 7,134 B shares held by the company as treasury shares to members of

Kesko’s Board of Directors as part of their annual fees, and issued a related stock exchange

release on 30 April 2025.

Kesko’s Annual General Meeting of 24 March 2025 authorised the Board to decide on the

issuance of a maximum of 33,000,000 new B series shares or B shares held by the company

as treasury shares, and on the repurchase of a maximum of 16,000,000 of the company’s

own B shares. The authorisations are valid until 30 June 2026, and were communicated in a

stock exchange release issued on 24 March 2025.


		16

Group’s key performance indicators


		2023	2024	2025
Income statement
Net sales	€ million	11,783.8	11,920.1	12,474.7
Change in net sales	%	-0.2	1.2	4.7
Change in net sales, comparable	%	-0.8	-2.3	2.3

Operating profit, comparable	€ million	712.0	650.1	654.9
Operating margin, comparable	%	6.0	5.5	5.3

Operating profit	€ million	695.4	579.5	631.3
Operating margin	%	5.9	4.9	5.1

Profit for the period	€ million	495.6	379.1	404.2
Profit for the period as percentage of net sales	%	4.2	3.2	3.2

Profitability
Return on equity	%	18.0	13.8	14.6
Return on equity, comparable	%	18.5	16.1	15.3
Return on capital employed	%	13.1	10.1	10.0
Return on capital employed, comparable	%	13.4	11.3	10.4

Funding and financial position
Interest-bearing net debt	€ million	2,559.8	2,908.2	3,406.4
Interest-bearing net debt excluding lease liabilities	€ million	561.9	857.2	1,308.9
Gearing	%	92.8	106.3	120.5
Equity ratio	%	35.8	32.5	32.2
Interest-bearing net debt/EBITDA excluding the impact of IFRS 16		0.7	1.1	1.6
Interest-bearing net debt/EBITDA, IFRS		2.1	2.4	2.8


		2023	2024	2025
Other performance indicators
Capital expenditure	€ million	678.9	675.9	735.7
Capital expenditure as percentage of net sales	%	5.8	5.7	5.9
Cash flow from operating activities	€ million	1,049.5	1,008.2	879.7
Cash flow from investing activities	€ million	-590.2	-597.5	-541.8

Average number of personnel converted into full-time employees		14,766	15,347	15,665
Personnel as at 31 Dec.		17,702	18,309	18,991

		2023	2024	2025
Share performance indicators
Earnings/share, basic and diluted	€	1.25	0.95	1.02
Earnings/share, comparable, basic	€	1.28	1.11	1.07
Equity/share	€	6.93	6.84	7.03
Dividend/share*	€	1.02	0.90	0.90
Payout ratio	%	81.9	94.5	88.6
Payout ratio, comparable	%	79.7	80.9	84.5
Cash flow from operating activities/share	€	2.64	2.53	2.21
Price/earnings ratio (P/E), A share		14.46	18.95	18.96
Price/earnings ratio (P/E), B share		14.39	19.08	18.97
Effective dividend yield, A share	%	5.7	5.0	4.7
Effective dividend yield, B share	%	5.7	5.0	4.7
* Proposal to the General Meeting


		17

Calculation of performance indicators

Kesko uses alternative performance measures to reflect business performance and

profitability. These indicators should be examined together with the IFRS-compliant

performance indicators.

Change in comparable net sales is used to reflect changes in the Group’s business volume

between periods. The indicator reflects the change in net sales excluding the impact of

acquisitions and divestments, in local currencies. The comparable net sales have been

calculated by including in the net sales the business operations that have been part of Kesko

Group in both the reporting period as well as the comparison period. Other structural

arrangements related to acquisitions and divestments have been adjusted in the same

manner as acquisitions.

Exceptional transactions outside the ordinary course of business are treated as items

affecting comparability. Performance indicators reflecting comparable profit and profitability

are used to improve the comparability of operational performance between periods. Gains

and losses on disposal of real estate, shares and business operations, impairment charges

and significant restructuring costs are identified as items affecting comparability. Gains on

disposal have been presented within other operating income, and losses on disposal within

other operating expenses in the income statement. Impairment charges and significant profit

and loss items related to changes in lease agreements are presented in the income statement

under depreciation, amortisation and impairment charges.

Alternative performance measures that have been adjusted for the impact of IFRS 16 are

used to monitor the achievement of certain financial targets. The EBITDA excluding the

impact of IFRS 16 corresponds to EBITDA before the adoption of IFRS 16, and the interest-

bearing net debt excluding lease liabilities correspond to interest-bearing net debt before the

adoption of the standard. These restated indicators are included as components in the

Group’s financial target “interest-bearing net debt excluding lease liabilities divided by

EBITDA excluding the impact of IFRS 16”.

In addition, financial performance indicators for the Group have been presented as

alternative performance measures. The management uses these indicators to monitor and

analyse business performance, profitability and financial position.

Profitability


Operating profit, comparable		Operating profit +/– items affecting comparability

Items affecting comparability		– gains on disposal + losses on disposal + impairment charges +/- structural arrangements

Return on equity, %		(Profit/loss before tax - Income tax) x 100 / Shareholders' equity, average of the beginning and end of the reporting period

Return on equity, %, comparable		(Profit/loss adjusted for items affecting comparability before tax - Income tax adjusted for the tax effect of items affecting comparability) x 100 / Shareholders' equity, average of the beginning and end of the reporting period

Return on capital employed, %		Operating profit x 100 / (Non-current assets + Inventories + Receivables + Other current assets - Non-interest-bearing liabilities) on average for the reporting period

Return on capital employed, %, comparable		Comparable operating profit x 100 / (Non-current assets + Inventories + Receivables + Other current assets - Non- interest-bearing liabilities) on average for the reporting period

EBITDA		Operating profit + Depreciation and amortisation + Impairments

EBITDA, comparable		EBITDA +/- items affecting comparability


		18

Funding, capital expenditure and financial position


Equity ratio, %		Shareholders’ equity x 100 / (Total assets – Advances received)

Gearing, %		Interest-bearing net debt x 100 / Shareholders' equity

Interest-bearing net debt		Interest-bearing liabilities + Lease liabilities – Current other financial assets – Cash and cash equivalents

Interest-bearing net debt excluding lease liabilities		Interest-bearing net debt – Lease liabilities

Interest-bearing net debt excluding lease liabilities / EBITDA excluding the impact of IFRS 16		Interest-bearing net debt excluding lease liabilities / EBITDA excluding the impact of IFRS 16

Interest-bearing net debt / EBITDA, including the impact of IFRS 16		Interest-bearing net debt / EBITDA, including the impact of IFRS 16

Capital expenditure		Performance indicator includes investments in tangible and intangible assets, subsidiary shares, shares in associates and joint ventures and other shares. Additions of right-of-use assets for leases in the consolidated statement of financial position are not capital expenditure. Redemption of a leased property (right- of-use asset) is reported as capital expenditure.

Share performance indicators


Earnings/share, basic		(Profit/loss - Non-controlling interests) / Average number of shares

Earnings/share, diluted		(Profit/loss – Non-controlling interest) / Average diluted number of shares

Earnings/share, basic, comparable		(Profit/loss adjusted for items affecting comparability - Non- controlling interests adjusted for items affecting comparability) / Average number of shares

Equity/share		Equity attributable to owners of the parent / Basic number of shares at the balance sheet date

Payout ratio, %		(Dividend/share) x 100 / (Earnings/share)

Price/earnings ratio (P/E)		Share price at balance sheet date / (Earnings/share)

Effective dividend yield, %		(Dividend/share) x 100 / Share price at balance sheet date

Market capitalisation		Share price at balance sheet date x Number of shares

Cash flow from operating activities/share		Cash flow from operating activities / Average number of shares

Yield of A share and B share		Change in share price + Annual dividend yield


		19

Reconciliation of alternative performance measures to IFRS financial statements


€ million	2025	2024
Items affecting comparability
Gains on disposal	15.7	11.4
Losses on disposal	-2.8	-1.6
Impairment charges	-13.7	-40.0
Structural arrangements	-22.8	-40.4
Items in operating profit affecting comparability	-23.6	-70.6
Items in financial items affecting comparability	0.2	-0.8
Items in income taxes affecting comparability	3.4	7.7
Total items affecting comparability	-20.0	-63.7

Items in EBITDA affecting comparability	0.6	-12.3

Operating profit, comparable
Operating profit	631.3	579.5
Net of
Items in operating profit affecting comparability	-23.6	-70.6
Operating profit, comparable	654.9	650.1

EBITDA
Operating profit	631.3	579.5
Plus
Depreciation and impairment charges	239.1	247.9
Depreciation and impairment charges for right-of-use assets	359.1	375.5
EBITDA	1,229.6	1,202.9

EBITDA, comparable
EBITDA	1,229.6	1,202.9
Net of
Items in EBITDA affecting comparability	0.6	-12.3
EBITDA, comparable	1,228.9	1,215.2


€ million	2025	2024
Profit before tax, comparable
Profit before tax	510.3	471.5
Net of
Items in operating profit affecting comparability	-23.6	-70.6
Items in financial items affecting comparability	0.2	-0.8
Profit before tax, comparable	533.8	543.0

Net profit, comparable
Profit before tax, comparable	533.8	543.0
Net of
Income tax	105.5	92.0
Items in income taxes affecting comparability	3.4	7.7
Net profit, comparable	424.8	443.3

Net profit attributable to owners of the parent, comparable
Net profit, comparable	424.8	443.3
Net of
Net profit attributable to non-controlling interests	-0.7	-0.4
Net profit attributable to owners of the parent, comparable	424.2	442.9

Earnings per share, comparable, €
Net profit attributable to the owners of the parent, comparable	424.2	442.9
Average number of shares, basic, 1,000 pcs	398,084	397,922
Earnings per share, comparable, €	1.07	1.11

Return on capital employed, %
Operating profit	631.3	579.5
Capital employed, average	6,307.7	5,758.7
Return on capital employed, %	10.0	10.1

Return on capital employed, comparable, %
Operating profit, comparable	654.9	650.1
Capital employed, average	6,307.7	5,758.7
Return on capital employed, comparable, %	10.4	11.3


		20


€ million	2025	2024
Return on equity, %
Net profit	404.2	379.1
Equity, average	2,780.8	2,746.7
Return on equity, %	14.6	13.8

Return on equity, comparable, %
Net profit, comparable	424.8	443.3
Equity, average	2,780.8	2,746.7
Return on equity, comparable, %	15.3	16.1

Equity ratio, %
Shareholders’ equity	2,826.7	2,734.9
Total assets	8,823.1	8,471.2
Advances received	40.2	43.4
Equity ratio, %	32.2	32.5


		21

SUSTAINABILITY

STATEMENT


General information .....................................................	22
Environmental information ..........................................	43
EU Taxonomy ..................................................................	43
E1 Climate change ..........................................................	53
E5 Resource use and circular economy ........................	72
Social information .........................................................	78
S1 Own workforce ..........................................................	78
S2 Workers in the value chain .......................................	93
S4 Consumers and end-users .......................................	98
Governance information ..............................................	105
G1 Business conduct ......................................................	105
Appendices to sustainability statement ....................	110

Sustainability statement is part of the Report by the

Board of Directors.

This report is a translation of the Finnish original.


		22

GENERAL

INFORMATION


Kesko in brief ...................................................	22
Basis for preparation .......................................	22
Governance ......................................................	25
Strategy ............................................................	29
Impact, risk and opportunity management ...	37

Kesko in brief

Kesko is a Finnish listed trading sector company. Kesko has

approximately 1,700 stores engaged in chain operations in

Finland, Sweden, Norway, Denmark, Estonia, Latvia,

Lithuania and Poland.

Kesko Group's reportable segments consist of its business

divisions, namely the grocery trade, the building and

technical trade, and the car trade.

The Group's parent company, Kesko Corporation, is a

Finnish public limited company constituted in accordance

with the laws of Finland. The Company's business ID is

0109862-8, it is domiciled in Helsinki, Finland and its

registered address is PO Box 1, 00016 KESKO, Finland.

Basis for preparation

General basis for preparation (BP-1)

Kesko’s sustainability statement is prepared in accordance

with the principles of the European Sustainability Reporting

Standards (ESRS) as defined in the EU’s Corporate

Sustainability Reporting Directive (CSRD).

Kesko prepares Kesko Group’s sustainability statement

annually. The scope of the sustainability statement is the

same as that of the consolidated financial statements, and

the sustainability statement is prepared at the Group level

whenever the subject of reporting concerns the Group’s

own operations. Sustainability reporting covers the

subsidiaries included in Kesko’s consolidated financial

statements. Associates and joint ventures included in the

consolidated financial statements using the equity method

are not included in the Group‘s sustainability reporting, as

they are reported as part of Kesko’s value chain through a

potential business relationship. Information on acquired

subsidiaries is included in the sustainability statement from

the date on which control of the company transfers to

Kesko Group. The sustainability statement includes

information on the upstream and downstream parts of the

value chain for those topics where material impacts, risks or

opportunities have been identified. The reporting period of

the sustainability statement is the same as that of the

consolidated financial statements.

The Sustainability Audit Firm Deloitte Oy has issued the

company an independent sustainability reporting auditor’s

limited assurance report on Kesko’s sustainability statement

in accordance with ISAE 3000 (revised).

Kesko Group’s sustainability statement does not cover the

tagging of the Group sustainability statement with digital

XBRL sustainability tags in accordance with Chapter 7,

Section 22, Subsection 1(2), of the Accounting Act, because

sustainability reporting companies have not been able to

comply with that provision due to the absence of the ESEF

regulation or other European Union legislation.

The Board of Directors approved the publication of this

sustainability statement on 4 February 2026.


		23

Disclosures in relation to specific circumstances (BP-2)

Sources of estimation and outcome uncertainty

The metrics presented in the sustainability statement, in particular those related to value

chain disclosures such as value chain energy and industrial emissions and FLAG (Forest,

Land and Agriculture) emissions, involve elements of uncertainty. Where the preparation of

sustainability information includes significant estimates or uncertainties, these are described

in the reporting principles applied to the respective information.

The metrics presented in the sustainability statement have not been validated by an external

third party, other than the sustainability reporting auditor. An exception is the greenhouse

gas emissions information disclosed in section E1 Climate change. The Science Based Targets

initiative has reviewed the boundary applied in the calculation of Kesko’s emissions for the

base year 2024 used for Kesko’s climate targets.

Changes in preparation and presentation of

sustainability information

During 2025, Kesko refined the calculation of scope 1, scope 2 and scope 3 greenhouse gas

emissions disclosed in the E1 Climate change section and performed a reassessment of the

emissions inventory. The update of the emissions inventory supported the update of Kesko’s

climate targets and the preparation for validation by the Science Based Targets initiative of

those targets.

The completeness of the calculation of scope 1, scope 2 and scope 3 greenhouse gas

emissions reported in the 2024 sustainability statement has been enhanced by specifying the

content of the calculation and by addressing gaps identified after the completion of the 2024

sustainability statement. These updates affected all emission categories.

In connection with the refinements to the emissions calculation, corrections were also made

to the energy consumption data reported for 2024. Total energy consumption reported for

2024 was 752,695 MWh, whereas, following the corrections, total energy consumption to be

reported as the 2024 comparative figure is 777,155 MWh. Following the corrections, Kesko’s

total energy consumption for 2024 increased by 3%.

A significant change in Kesko’s emissions calculation and emissions inventory is the inclusion

of FLAG (Forest, Land and Agriculture) emissions as part of Kesko’s emissions inventory.

Land use related greenhouse gas emissions were not included in Kesko’s emissions inventory

in 2024, but they have been added retrospectively as part of the recalculation of the 2024

base year and the 2024 comparative year, and in connection with the setting of targets

related to greenhouse gas emissions. Land use related greenhouse gas emissions are

presented separately from other greenhouse gas emissions.

Based on the recalculation and reassessment of the emissions inventory, Kesko discloses the

most material emission categories in its scope 3 greenhouse gas emissions reporting. The

combined share of categories excluded from reporting is less than 1% of total scope 3

emissions. The excluded categories that were previously reported are Category 3 Fuel and

energy-related activities that are not included in scope 1 or scope 2, Category 5 Waste

generated in operations, Category 6 Business travel, Category 7 Employee commuting, and

Category 9 Downstream transportation and distribution.

A reconciliation between the scope 1, scope 2 and scope 3 greenhouse gas emissions

reported in 2024 and the recalculated 2024 comparative year emissions is presented in the

E1 Climate change section under Greenhouse gas emissions (E1-6).

Use of phased-in transitional provisions

The ESRS 1 General Requirements standard includes transitional provisions for the first years

of application of the Corporate Sustainability Reporting Directive (CSRD). Kesko utilised

these transitional provisions in its first reporting year under the CSRD, in 2024, particularly in

relation to disclosure requirements concerning anticipated financial effects.

In the 2024 sustainability statement, Kesko also applied the ESRS 1 transitional provision

under which an undertaking is not required to disclose comparative information in the first

year of preparing a sustainability statement in accordance with the ESRS. Kesko publishes

comparative information for the 2024 reporting year in the 2025 sustainability statement.

On 11 July 2025, the European Commission adopted the so-called “quick-fix” delegated

regulation, under which the validity of the transitional provisions granted for the first

reporting year was extended to the 2025 and 2026 reporting years. In addition, transitional


		24

provisions that would have applied to companies with an average of up to 750 employees

were extended to apply to all companies for the 2025 and 2026 reporting years.

As part of the European Commission’s efforts to simplify and facilitate reporting obligations

under the Corporate Sustainability Reporting Directive (CSRD), the European Financial

Reporting Advisory Group (EFRAG) published draft simplified European Sustainability

Reporting Standards (ESRS) in December 2025. The simplified standards are expected to

apply from the 2027 reporting year, with voluntary early application expected to be possible

already for the 2026 reporting year. Kesko has not yet assessed the potential impact of the

simplified standards on the disclosures provided in Kesko’s sustainability statement.

In preparing the 2025 sustainability statement, Kesko applies the following transitional

provisions:

• ESRS 2, SBM-1, paragraph 40b

• ESRS 2, SBM-1, paragraph 40c

• ESRS 2, SBM-3, paragraph 48e

• ESRS E4 Biodiversity and ecosystems: The disclosures are provided in accordance with

paragraph 17 of ESRS 2 General disclosures.

E4 Biodiversity and ecosystems

As part of the 2025 update of its double materiality assessment, Kesko identified a material

impact under ESRS E4 Biodiversity and ecosystems, within the sub-topic Direct drivers of

biodiversity loss and the sub-sub-topic Land-use change and changes in freshwater and

ocean use. This impact is primarily associated with biodiversity loss in the upstream

value chain.

In Kesko’s business model, the product assortment is broad and includes products whose raw

materials have impacts on nature in primary production, such as agriculture, forestry, mining

or fishing. The sourcing of these raw materials can be guided through product- and raw

material-specific sustainability guidelines, particularly for private label products. Kesko’s

sustainability policy, updated in 2025, provides the foundation for Kesko’s work to promote

biodiversity. Our principle is to prevent biodiversity loss both in our own operations and

across the value chain.

During 2025, Kesko prepared action plans for all three divisions to mitigate biodiversity-

related impacts in the value chain. The action plans focus on four areas: strengthening the

competence of sourcing personnel by increasing training; identifying biodiversity-critical raw

materials and, where possible, establishing guidelines for these materials; improving the

availability and coverage of origin-related data for products that contain critical raw

materials; and establishing strategic partnerships to reduce impacts contributing to

biodiversity loss.

Kesko guides the sourcing of products that contain raw materials identified as

environmentally critical through sustainability guidelines. In 2025, raw materials and product

groups for which impacts on biodiversity have been identified and for which Kesko has an

existing guideline include cocoa, coffee and tea, fish and seafood, palm oil, soy, textiles, and

timber and paper. These guidelines primarily guide the sourcing of Kesko’s private label

products and the raw materials used in them through internationally recognised

certification schemes.

Kesko assesses the need for new guidelines and develops additional guidelines aimed at

reducing adverse nature-related impacts in supply chains. The need for new guidelines may

arise, for example, from assessed nature-related impacts, stakeholder expectations or

regulatory developments. In 2025, Kesko expanded its cotton guideline into a broader textile

guideline and aims to reduce negative impacts in the supply chains of textile products. New

guidelines and changes to existing ones are approved by Kesko’s Group sustainability

management team.

Implementation of the guidelines in product assortments is managed through division-

specific steering and management groups. The divisions’ sustainability units guide sourcing

organisations on required actions and review implementation with them annually.

The logistics centre for Onninen and K-Auto was completed in Hyvinkää in autumn 2025.

The City of Hyvinkää and Kesko entered into an agreement on the voluntary compensation of

nature losses resulting from the construction of the logistics centre and on generating new

nature values. The agreement is partly based on the principles of voluntary ecological

compensation set out in the Finnish Nature Conservation Act.

Kesko has not set time‑bound targets for biodiversity and ecosystems.


		25

Governance

The role of administrative, management and supervisory

bodies (GOV-1)

Board of Directors and Board Committees

Kesko’s Board of Directors is responsible for the Company’s corporate governance and for

the proper organisation of its operations, which also includes responsibility for sustainability

topics. The Board has confirmed a written charter of the Board’s duties and principles of

operation. According to its charter, the Board reviews and makes decisions on matters that

are financially, operationally or fundamentally significant to the Group. The Board

Committees support the Board’s work and prepare matters the Board is responsible for. The

charters of the Board and its Audit Committee include tasks related to monitoring and

evaluating sustainability reporting and its assurance.

The Board of Directors decides on the Group’s strategy, including sustainability topics and

strategic targets related to sustainability. The progress made in the strategy and targets is

reported regularly to the Board, including as part of the review by the President and CEO.

The Board of Directors approves all Group-level policies. The Board of Directors has

approved and adopted the K Code of Conduct, and other policies approved by the Board of

Directors that address various sustainability topics include the sustainability policy, the

people policy, the risk management policy, the governance policy, the data protection policy,

and the tax policy.

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. The General Meeting decides on

the number of Board members, elects all Board members, and decides on their remuneration

based on proposals submitted by the Shareholders’ Nomination Committee. The main duty

of the Nomination Committee is to ensure that the Board of Directors and its members have

the expertise, know-how and experience adequate for Kesko’s needs. In preparing its

proposals, the Shareholders’ Nomination Committee must also take into account the

principles concerning Board diversity, which are included in the diversity policy approved by

the Board. The diversity policy describes the objectives in the achievement of diversity in the

operations and composition of the Board of Directors.

The experience, educational backgrounds and professional competencies of the Board

members represent multiple disciplines and diversity. Kesko’s Board members are

experienced business leaders with broad expertise. This enables the effective assessment,

guidance and supervision of material sustainability aspects relevant to Kesko Group. The

Board members’ experience in managing various business operations supports their ability to

guide the Group’s strategic choices, taking sustainability perspectives into account. Several

Board members have experience in the trading sector,and the principal occupation of two of

the seven Board members is acting as a K Group grocery retailer, while one is a K Group

building and home improvement retailer. Several Board members have also experience in

international business operations.

At the Annual General Meeting held on 24 March 2025, seven members were elected to the

Board, and they served as Board members on 31 December 2025. Of the Board members,

57% are men and 43% are women. The average ratio of female to male Board members is

0.75. The Board members are aged between 44 and 64.

The Board carried out its annual independence evaluation at its meeting in March 2025.

Based on the independence evaluations, the Board considers the majority of the Board

members (approximately 57%) to be independent of the Company. The Board members

(86%), apart from one member, were deemed independent of the Company’s significant

shareholders. The compositions of the Board and its Committees meet the independence

requirements of the Finnish Corporate Governance Code issued by the Finnish Securities

Market Association and effective as of 1 January 2025. All members of Kesko’s Board of

Directors are non-executive directors. There are no personnel representatives on the Board.

Audit Committee

The Board has, in the Audit Committee’s charter, defined the Committee’s duties related to

sustainability reporting. The Audit Committee monitors and assesses Kesko’s financial and

sustainability reporting system, including the processes for financial statements reporting

and sustainability reporting, and monitors the procedures in identifying information to be

reported in compliance with sustainability reporting standards. The Committee monitors

sustainability reporting assurance and reviews the assurance report by the Authorised

Sustainability Auditor and possible other reports presented by the Authorised Sustainability

Auditor to the Committee. The Committee presents to the Board of Directors the results of

the sustainability reporting assurance. In addition, the Audit Committee’s duties include


		26

monitoring statutory audit, monitoring and assessing the effectiveness of Kesko’s internal

control, internal audit and risk management systems, and monitoring and assessing the

scope and efficiency of Kesko’s compliance system.

At Audit Committee meetings, the Group’s Chief Financial Officer, the Group Controller, the

Chief Audit and Risk Officer, and the Executive Vice President for Legal and Sustainability

regularly report to the Committee on their areas of responsibility. The Authorised

Sustainability Auditor is present at the Committee meetings and presents its audit plan and

Kesko_2025_VSK_Kesko Group’s governance model.svg

report to the Audit Committee.

Remuneration Committee

The Remuneration Committee considers sustainability-related matters as part of its

responsibilities in management remuneration. The Remuneration Committee prepares the

Company’s Remuneration Policy for Governing Bodies and monitors its implementation. The

Remuneration Committee conducts preparatory and development work on matters

pertaining to remuneration schemes, including evaluating the remuneration of the President

and CEO and other management, preparing potential share and share-based compensation

schemes, and preparing the principles for the performance and result criteria of the

compensation schemes, and monitoring their implementation and evaluating their impact on

Kesko’s long-term financial success.

The Group’s President and CEO and the Group Management Board

The Board of Directors appoints the company’s Managing Director, who at Kesko is referred

to as the President and CEO. Kesko’s President and CEO has overall responsibility for the

implementation of the sustainability strategy and for achieving the common sustainability

objectives. The Group Management Board supports the President and CEO in this role and

ensures that sustainability aspects are integrated into management decision-making,

strategic planning and operational steering. The members of the Group Management Board

have strong business expertise and experience in their respective areas of responsibility. In

addition, the Group Management Board has specific expertise and experience, for example,

in matters relating to personnel, sustainability, finance and risk management, which also

support integration of sustainability considerations in the Group’s decision-making.

The Group Management Board regularly discusses in its meetings Kesko’s most material

sustainability impacts, risks and opportunities, as well as progress towards the targets set. As

at 31 December 2025, the Group Management Board, including the President and CEO,

comprised eight members. At the end of 2025, 62.5% of the members of the Group

Management Board were men and 37.5% were women.

Sustainability governance model


		27

Group sustainability management team and divisions

The Group sustainability management team promotes the measures set out in the

sustainability strategy, monitors progress, coordinates Group-level initiatives and shares best

practices across Kesko. The team is chaired by the Executive Vice President, Legal and

Sustainability, a member of the Group Management Board who reports directly to the

President and CEO. The Chair is responsible for the content of the sustainability strategy and

for monitoring its progress, and supports the implementation of division-specific

sustainability strategies. Other members represent the divisions and Kesko’s

common functions.

Division Presidents are responsible for achieving Group-level and division-specific

sustainability targets within their respective divisions, monitoring the progress of measures,

allocating resources, and making the necessary investments. The Group’s common functions

support progress in sustainability work.

Information provided to and sustainability matters

addressed by the undertaking’s administrative,

management and supervisory bodies (GOV-2)

The Board of Directors decides on the Group’s strategy, including sustainability topics and

sustainability-related strategic targets. Progress on the strategy and targets is reported to

the Board regularly, including as part of the President and CEO’s review, which is addressed

at every regular Board meeting. The Executive Vice President, Legal and Sustainability,

presents specific sustainability-related themes, such as the 2025 update of climate targets,

to the Board for approval.

During 2025, the Board of Directors addressed the following sustainability-related topics:

• approved the criteria for remuneration programmes, including sustainability-related criteria

• approved the update of climate targets for the Group’s own operations (scope 1 and 2)

• approved short- and long-term targets for reducing scope 1, scope 2 and scope 3

greenhouse gas emissions, including the net-zero target extending to 2050

• approved short- and long-term targets for reducing land use-related greenhouse gas

emissions in scope 1 and scope 3

• approved Kesko’s commitment to achieving zero deforestation in the most critical

commodity groups linked to deforestation

• approved the submission of greenhouse gas emission reduction targets to the Science

Based Targets initiative (SBTi) validation process

• approved the updated data protection policy, people policy and sustainability policy, as well

as the new artificial intelligence policy. The new and updated policies will enter into force

on 1 January 2026. The most significant changes in the updated sustainability policy are

described in each relevant topic-specific section.

The Chair of the Board’s Audit Committee reports on the Committee’s work at the Board

meeting following each Committee meeting. The Executive Vice President, Legal and

Sustainability, reports to the Audit Committee on sustainability reporting matters. In 2025,

the Audit Committee addressed sustainability reporting in four of its five regular meetings.

At each regular meeting, the Committee also reviews the Group’s risk map and any changes

to it, as reported by the Chief Audit and Risk Officer. Twice a year, the Vice President,

Governance, Compliance and Ethics, reports on the governance, compliance and ethics

review, including, among other things, the status of the K Compliance programmes and

reports received via the SpeakUp channel.

In 2025, the Board’s Audit Committee monitored measures related to the implementation of

sustainability reporting, such as the sustainability reporting development plan and the update

of the double materiality assessment for 2025. A list of the material impacts, risks and

opportunities included in the double materiality assessment, as discussed in the review, is

presented in the section General information, Material impacts, risks and opportunities and

their interaction with strategy and business model (SBM-3).

The Executive Vice President, Legal and Sustainability, addresses sustainability topics in their

review at each Group Management Board meeting. In 2025, the Group Management Board

focused in particular on climate targets and emissions calculation, biodiversity, sustainability

regulation and the development of sustainability reporting, occupational safety and

employee wellbeing, as well as compliance and ethical corporate culture. The Group

Management Board addressed updates to climate targets for the Group’s own operations

(scope 1 and 2) and the overall set of climate targets to be submitted for Science Based

Targets initiative validation, as well as the updated 2025 double materiality assessment, and

approved Kesko’s participation in the Finnish national energy efficiency agreement for

2026–2035. It also reviewed all Board-approved Group-level policies prior to their

submission to the Board.


		28

Sustainability-related targets in incentive schemes

(GOV-3)

Kesko has four share-based commitment and incentive plans: Performance Share Plan

President and CEO (PSP President and CEO) and a transitional phase share-based

compensation plan (Bridge Plan) for Kesko’s President and CEO, Performance Share Plan

(PSP) and Key Personnel Share Plan (KPSP). The share-based commitment and incentive

schemes are described in Note 5.3 Share-based compensation of the consolidated

financial statements.

One of the performance criteria in the PSP President and CEO, Bridge Plan and PSP is

Kesko’s sustainability target with a weight of 10%. The most significant sustainability targets

are scope 1 and 2 emission reductions targets and targets linked to international

sustainability indices and assessments. The terms of the PSP President and CEO, Bridge Plan

and PSP share program are approved by the Board of Directors. In the KPSP, sustainability

metrics are linked to the individual’s job description and responsibilities, and they are

approved by the individual’s manager.

In 2025, in addition to the share-based plans, one of the performance bonus criteria for the

members of the management teams of Kesko’s divisions and common functions and the

persons reporting to them has been the sustainability target in accordance with the

sustainability strategy. In these cases, the sustainability-related target is defined individually

based on each person’s role and area of responsibility. Sustainability targets have also been

set for a large number of key personnel covered by the performance bonus scheme,

according to their role. The performance bonus criteria are approved by the individual’s

manager.

Statement of due diligence (GOV-4)

The Group’s statement on sustainability due diligence processes is described in the sections

of the sustainability statement mentioned below:

• S2 Workers in the value chain – Policies and processes related to value chain workers

• S4 Consumers and end-users – Policies and processes related to product safety

• S4 Consumers and end-users – Policies and processes related to data protection

• G1 Business conduct – Policies related to corporate culture and business conduct

Risk management and internal controls over sustainability

reporting (GOV-5)

Members of the Group Management Board are responsible for the effective and efficient

implementation of internal control and risk management in their respective areas of

responsibility. A risk management function independent of businesses is responsible for

providing a framework and guidance for internal control and risk management, and it

supports, coordinates and supervises risk management implementation in Kesko Group.

The objective of internal control is to provide the Board of Directors and the company’s

management with reasonable assurance regarding the reliability of reporting and that the

information disclosed in the sustainability statement has been prepared appropriately and is

presented fairly.

Risks related to sustainability reporting have been identified particularly in relation to

reporting accuracy, the reliability of data processing and the completeness of data. In

addition, the tight reporting timetable increases the risk related to the timeliness of

reporting. Key risk management measures identified for reporting include developing

processes for data collection and consolidation, strengthening personnel competence in

producing sustainability information, and clarifying roles and responsibilities with respect to

the ownership of sustainability information. Identifying reporting-related risks and defining

internal controls to address these risks forms part of the overall process improvement work.

Internal audit takes sustainability and sustainability reporting topics into account as part of its

risk-based audit planning and the Group’s overall risk assessments. Sustainability topics have

been addressed in audits particularly where they relate to reporting processes, the reliability

of information, the clarity of guidance and responsibilities, or compliance with regulatory

requirements. The internal audit plan for 2026 includes an audit related to Science Based

Targets initiative aligned targets, which supports the assessment of the reliability of

sustainability targets and the related reporting.


		29

Strategy

Strategy, business model and value chain (SBM-1)

Kesko’s strategy is focused on being the leading and most attractive trading sector company

in Northern Europe. The objective is to ensure profitable growth, increase customer value,

and strengthen market position across all three divisions: grocery trade, building and

technical trade, and car trade. The foundation of Kesko’s strategy work is quality and

efficiency, the continuous improvement of the omnichannel customer experience,

K-retailers, sustainability in all operations, and being a trusted operator.

Kesko’s sustainability strategy is built on four focus areas: climate and nature, value chain,

our people, and good governance. Key topics related to climate and nature include reducing

greenhouse gas emissions throughout the value chain and promoting resource efficiency and

the circular economy, particularly by increasing the recycling rate of waste and reducing food

waste. These topics are discussed in sections E1 Climate change and E5 Resource use and

circular economy.

Value chain topics include cooperation with goods and service providers, the implementation

of K Code of Conduct guidelines in the supply chain, and the realisation of those guidelines

towards consumers as Kesko’s customers. Further information on these topics is provided in

sections S2 Workers in the value chain, S4 Consumers and end-users, and G1 Business

conduct, which also covers relationships with goods and service suppliers.

Our People section covers focus areas related to Kesko’s own personnel, detailed in section

S1 Own workforce. Good governance encompasses the promotion of corporate culture and

commitment to the K Code of Conduct, as described in section G1 Business conduct.

Business model and value chain

In the trading sector value chain, Kesko’s role is to make products manufactured by suppliers

available to customers through physical stores and digital channels. Kesko operates in

Finland, Sweden, Norway, Denmark, Estonia, Latvia, Lithuania, and Poland. Kesko’s business

models include the chain business model, own retail, and B2B trade. In the chain business

model, Kesko acts as a wholesaler to K-retailers, and independent retailer entrepreneurs are

responsible for resale to end customers. In own retail, both consumer and corporate

customers are Kesko’s customers. Kesko’s wholesale to retailers accounted for 43% (45%) of

the Group’s net sales in 2025. B2B trade accounted for 41% (37%) of the Group’s net sales in

2025. Kesko’s B2C trade accounted for 16% (18%) of the Group’s net sales.

In 2025, Kesko’s net sales totalled €12,475 million. Kesko has three divisions, which are also

reportable segments in the consolidated financial statements: grocery trade; building and

technical trade, including building and home improvement and technical trade operations;

and car trade, including car and sports trade operations.

Grocery trade

The grocery trade division comprises the wholesale and B2B trade of groceries and the

retailing of home and speciality goods in Finland.

Building and technical trade

The building and technical trade division operates in wholesale, retail and B2B trade in

Finland, Sweden, Norway, Denmark, the Baltics and Poland. In Finland, Kesko operates the

building and home improvement trade with the retailer business model. In Sweden, Norway

and Denmark, Kesko operates as a retailer. Building and home improvement stores serve

both consumers and professional builders. Technical trade is B2B trade.

Car trade

The car trade division comprises the businesses of new cars, used cars, services and leasing.

The car trade division includes sports trade. The car trade division operates mainly in the

Finnish market.

For more information on the operating activities of the different divisions, their financial

information and the geographical breakdown of net sales, see note 2.2 Segment information

in the consolidated financial statements.

In 2025, Kesko employed a total of 18,991 people. The number of personnel in Kesko’s

operating countries is disclosed in section S1 Own workforce of the sustainability statement.


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Kesko business model and value chain


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Interests and views of stakeholders (SBM-2)

Dialogue with stakeholders is vital for the development of operations. Effective and active

dialogue enables us to understand stakeholders‘ perspectives, concerns and ideas for

improving our operations. Our communication with stakeholders is active and transparent.

Stakeholder views are communicated to the Board of Directors, its Committees and the

Company’s management as needed, for example as part of the double materiality

assessment process.

The table below contains descriptions of Kesko’s main stakeholders, forms of cooperation,

the most important sustainability topics for stakeholders and their impact on our operations.


Stakeholder	Forms of cooperation	Key sustainability topics	Meeting stakeholder expectations
Consumers and end- users	• Daily customer encounters • Customer service channels and applications • Customer surveys • K-Kylä customer community • Social media	• Healthiness of products • Product safety • Origin of products and sustainable supply chains • Circular economy solutions and waste reductions • Promoting sustainability at local level	• Increasing transparency on origin and production • Returning purchase data to the customer • Innovative foods using food waste • K-retailers’ sustainability actions
B2B customers	• Customer meetings • Supplier trainings and trade fairs	• Origin of products and sustainable supply chains • Products’ carbon footprint data	• Increasing transparency on origin and production • Carbon footprint data and calculators
Own workforce	• Personnel surveys and performance and development reviews • Personnel events • Cooperation with personnel representatives • SpeakUp reporting channel	• Employee wellbeing • Occupational health and safety • Diversity, equity and inclusion • Good leadership and opportunities for personal development	• Wellbeing solutions for employees • Occupational health services and measures to reduce work-related accidents • DEI action plan, target setting and developing diversity-supporting recruitment • Measures and coaching to support development and leadership
K-retailers	• Retailer events and meetings • Electronic communication channels and trade magazines • SpeakUp channel	• Circular economy, waste and packaging • Sustainable products and certifications • Supporting customers in making sustainable choices • Local sustainability initiatives	• Measures to promote the circular economy, monitoring of evolving regulation, and related support • Increasing transparency on product origin and production, and certifications • Selections planning, providing customers with feedback based on purchase data, and sustainability-related communications • K Group-wide initiatives, for example to promote physical activity among children and young people
Investors, shareholders, analysts and other representatives of capital markets	• General Meeting • Financial reporting and press conferences • Investor websites and social media channels • Investor and analyst meetings • Surveys and assessments	• Greenhouse gas emissions and transition plan for reducing emissions • Biodiversity, soil health and water • Sustainable supply chains • Employee-related social responsibility • Governance and remuneration	• Transition plan and emission reduction measures • Assessments on biodiversity loss and water use and measures in the value chain • Verification of sustainable procurement through due diligence processes • Measures to improve wellbeing, safety at work and diversity • Verification of good governance and linking sustainability to remuneration
Suppliers, service providers and supply chain workers	• Meetings with suppliers and business partners • Business partner events • Organisations and purchasing alliances	• Human rights in the supply chain • Measures for reducing emissions • Sustainable products and services	• Human rights commitments, assessments and audits • Challenging partners to set climate targets (CDP) • Cooperation to introduce sustainable products into the selection
NGOs and corporate advocacy activities in organisations	• Dialogue with NGOs • Corporate advocacy - activities in organisations	• Origin of products and supply chain working conditions • Value chain’s environmental impacts • Development of regulation on sustainability	• Increasing transparency on origin and production • Cooperation with NGOs on key sustainability issues • Anticipation of and preparation for regulatory changes


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Material impacts, risks and opportunities and their

interaction with strategy and business model (SBM-3)

Kesko has updated the double materiality assessment first published in 2024 for the 2025

reporting period.

As an outcome of the updated double materiality assessment, Kesko identified material

impacts related to seven ESRS standards and their respective sub-topics. The material

impacts, risks and opportunities are presented in a table, including a description of each

impact, risk or opportunity, its location in the value chain, and the time horizon over which it

is expected to materialise.


ESRS standards		Material sustainability topics
Environment
	Climate change	Climate change mitigation Energy
	Biodiversity and ecosystems	Land-use change, fresh water-use change and sea-use change
	Resource use and circular economy	Resource outflows related to products and services: Packaging Waste Food waste
Social
	Own workforce	Working conditions Equal treatment and opportunities for all
	Workers in the value chain	Working conditions Child labour and forced labour
	Consumers and end- users	Health and safety Privacy
Governance
	Business conduct	Corporate culture Protection of whistleblowers Management of relationships with suppliers Corruption and bribery

Non-material ESRS standards
	Pollution
	Water and marine resources
	Affected communities


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Material impacts, risks and opportunities identified in the double materiality assessment


Topic	Impact, risk or opportunity	Value chain	Time horizon	Description
E1 Climate change
Climate change mitigation	Actual negative impact	Own operations	Short-, medium- and long-term	Kesko‘s own operations generate greenhouse gas (GHG) emissions (scope 1 and 2). The most significant source of scope 1 emissions are the fuel emissions of transportation and logistics. The most significant source of scope 2 emissions are district heating consumption emissions.
Climate change mitigation	Actual negative impact	Upstream and downstream	Short-, medium- and long-term	Kesko‘s value chain generates GHG emissions (scope 3). Most of the value chain emissions arise during the life cycle of purchased and sold products, from their production, use, and end-of-life treatment. Additionally, emissions are generated from the manufacturing of capital goods and upstream transportation.
Energy	Actual negative impact	Own operations	Short-, medium- and long-term	The consumption of fossil energy sources in properties owned and managed by Kesko and in transport and logistics generates GHG emissions.
E4 Biodiversity and ecosystems
Land-use change, fresh water-use change and sea-use change	Actual negative impact	Upstream	Short-, medium- and long-term	Kesko’s value chain contributes to biodiversity loss. Kesko’s product range includes high-impact commodities that have significant nature-related impacts, primarily through land-use and sea-use change linked to production activities, such as agriculture, forestry, mining and fishing.
E5 Resource use and circular economy
Resource outflows related to products and services: Packaging	Actual negative impact	Own operations	Short-, medium- and long-term	The logistics chain of products includes several types of packaging, from logistics packaging to individual product retail packaging.
Waste	Actual negative impact	Own operations	Short-, medium- and long-term	Waste is generated in Kesko’s operations, especially in warehouse operations, logistics and in own retail operations.
Food waste	Actual negative impact	Own operations	Short-, medium- and long-term	Food waste is generated in Kesko’s warehouse operations, logistics and cash-and-carry outlets.
Food waste	Actual negative impact	Downstream	Short-, medium- and long-term	Food waste is generated in K-food retailers’ store operations.
S1 Own workforce
Working conditions: Adequate wage	Potential positive impact	Own operations	Short-, medium- and long-term	Kesko is committed to providing all employee groups with an adequate wage, which is based on national pay levels and covers at least the basic needs of employees and their families.
Working conditions: Social dialogue and collective bargaining	Actual positive impact	Own operations	Short-, medium- and long-term	Social partners engage in continuous dialogue to take employees’ expectations into account. This ensures fair working conditions for employees and terms of employment are in line with local legislation and labour market practices.
Working conditions: Health and safety	Actual negative impact	Own operations	Short-, medium- and long-term	Although measures and management models to promote health, work capacity and occupational safety are systematically implemented, work-related accidents may still occur and employees may become ill.
Equal treatment and opportunities for all: Gender equality	Potential positive impact	Own operations	Short-, medium- and long-term	The experience of gender equality has a significant impact on employee experience and job satisfaction. Adhering to principles that promote gender equality fosters fairness and equality in the workplace.
Equal treatment and opportunities for all: Diversity	Potential positive impact	Own operations	Short-, medium- and long-term	Diverse and inclusive work community creates the conditions for innovation and strengthens employee wellbeing.
Equal treatment and opportunities for all: Prevention of violence and harassment	Potential positive impact	Own operations	Short-, medium- and long-term	In our work community, everyone can perform their work without fear of violence, threats or harassment. Preventing violence is part of a day-to-day safety culture that supports wellbeing and productivity.
Equal treatment and opportunities for all: Training and skills development	Actual positive impact	Own operations	Short-, medium- and long-term	Continuous learning, career development and systematic performance management are key elements of competence development and a positive employee experience. Competent personnel are also ensured through business-driven recruitment.


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Topic	Impact, risk or opportunity	Value chain	Time horizon	Description
S2 Workers in the value chain
Working conditions	Potential negative impact	Upstream	Short-, medium- and long-term	Inadequate working conditions weaken value chain workers’ wellbeing and quality of life.
Child labour and forced labour	Potential negative impact	Upstream	Short-, medium- and long-term	Infringements of labour rights affecting value chain workers cause suffering for the affected workers and their families.
Working conditions Child labour and forced labour	Risk	Upstream	Short-, medium- and long-term	A breach of the supplier agreement between the supplier and Kesko and conduct that violates the K Code of Conduct may affect Kesko’s reputation and lead to disruptions in business operations if the business relationship with the supplier has to be terminated.
S4 Consumers and end-users
Health and safety: Enabling healthy choices	Potential positive impact	Downstream	Short-, medium- and long-term	Kesko has the opportunity to influence the health of consumers and end-users by offering healthier products that contain less salt, sugar or saturated fat.
Health and safety: Product safety	Potential negative impact	Downstream	Short-, medium- and long-term	Deficiencies in the safety of the products sold by Kesko can have significant negative impacts on the health and safety of consumers and end-users.
Health and safety: Product safety	Risk	Downstream	Short-, medium- and long-term	The realisation of product safety risk may cause reputational damage and may result in liability for damages for Kesko.
Privacy: Data protection	Potential negative impact	Downstream	Short-, medium- and long-term	Kesko processes large amounts of data related to consumers’ personal data in its operations. Deficiencies in Kesko’s data protection principles and personal data processing procedures can expose consumers to misuse of their personal data.
Privacy: Data protection	Risk	Downstream	Short-, medium- and long-term	The realisation of data protection risk may cause reputational damage and may result in liability for damages for Kesko.
G1 Business conduct
Corporate culture	Potential positive impact	Value chain	Short-, medium- and long-term	The K Code of Conduct supports the principles of ethical corporate culture. Kesko has two versions of the K Code of Conduct: a K Code of Conduct that covers the entire K Group and a separate K Code of Conduct for business partners. Both support the principles of an ethical corporate culture throughout the value chain.
Corporate culture	Risk	Own operations	Short-term	Increasing sustainability regulation may lead to changes in the business model and require investments to meet legislative requirements.
Protection of whistleblowers	Potential positive impact	Value chain	Short-, medium- and long-term	Kesko has a confidential SpeakUp channel that is open to personnel, customers, suppliers and other stakeholders. Kesko has anti-discrimination and anti-harassment principles, which, in line with the absolute prohibition of retaliation, ensure that the reporting of incidents or suspected incidents does not adversely affect the reporter or their employment relationship.
Corruption and bribery	Potential negative impact	Own operations, downstream	Short-, medium- and long-term	Potential cases of corruption and bribery have a negative impact on society and undermine trust throughout the value chain. Kesko has a zero-tolerance approach to corruption and bribery. Prevention of corruption and bribery is an integral part of the K Code of Conduct and contributes to creating a more ethical value chain.
Relationships with suppliers and service providers	Potential positive impact	Downstream	Short-, medium- and long-term	Kesko‘s requirements for suppliers and service providers, such as commitment to the K Code of Conduct for business partners, promote an ethical and sustainable value chain.


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Changes to the material impacts, risks and opportunities compared

to the previous reporting period

Kesko updated its double materiality assessment for the 2025 reporting period. The update is

based primarily on the material impacts, risks and opportunities identified in the 2024 double

materiality assessment, as a full-scale process for identifying and assessing impacts, risks and

opportunities was not carried out in 2025. For the purposes of 2025 reporting, Kesko

reviewed the sustainability matters identified as material in the double materiality assessment

and the related impacts, risks and opportunities, and confirmed their materiality. No

significant changes in Kesko’s business operations or operating environment were assessed

to have occurred that would affect the impacts, risks or opportunities identified.

The most significant change compared with the information presented in 2024 relates to

ESRS E4 Biodiversity and ecosystems, where an impact connected to land-use change and

changes in the use of freshwater and marine resources was identified and assessed as a

material impact in the upstream value chain. In the 2024 double materiality assessment,

Kesko had already identified topics related to this standard as requiring specific analysis and

monitoring in the process of updating the double materiality assessment in the coming years.

In addition to the change related to ESRS E4, updates to the double materiality assessment

were made in relation to ESRS E1 Climate change and ESRS S1 Own workforce. Regarding

ESRS E1, climate-related risks were reassessed during 2025. Based on this review, the risk

assessed as material in the 2024 double materiality assessment was not considered, in the

2025 review, to give rise to a material financial effect for Kesko. As a result, ESRS E1 Climate

change is associated only with material negative impacts in Kesko’s own operations and

value chain, particularly in relation to greenhouse gas emissions.

Furthermore, in the update of the double materiality assessment for ESRS S1 Own workforce,

a potential positive impact related to the sub-sub-topics working time and work-life balance

within the working conditions sub-topic was assessed to remain below the materiality

threshold.

Impacts, risks and opportunities

Environment

In Kesko’s business model, the material climate- and nature-related sustainability impacts are

primarily associated with the products sold by Kesko across all business divisions. Climate-

and nature-related impacts in Kesko’s own operations and value chain are actual

negative impacts.

A significant share of the identified impacts arises in the upstream value chain from the

manufacturing of products, or in the downstream value chain from the use of products. Most

greenhouse gas emissions arise from the production and use of products, and most food

waste is generated in K-food retailers’ store operations. Product-related impacts on

biodiversity also arise primarily in the upstream value chain in connection with product

manufacturing. In Kesko’s own operations, the key impacts relate in particular to greenhouse

gas emissions generated by operations, resource outflows in the form of packaging materials,

and waste and food waste generated in operations.

Social

Kesko has 18,991 employees under employment contracts, and Kesko’s operations are

connected to their employment, wellbeing, health and safety. Through its own actions, Kesko

can contribute positively to employee wellbeing by ensuring equal treatment and by

providing training and development opportunities. Negative impacts have been identified in

relation to health and safety, as occupational accidents and illnesses occur despite

preventive measures and operating models. Through extensive supply chains, Kesko is

connected to value chain workers, and a risk has been identified related to potential breaches

of Kesko’s K Code of Conduct guidelines.

Consumers are a key customer group in Kesko’s business model. With regard to consumers

and end-users, potential negative impacts have been identified in particular in relation to the

safety of products sold by Kesko and to data protection. In both cases, the potential negative

impacts are, by nature, limited to individual cases.


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Governance

Promoting an ethical corporate culture and ensuring compliance with business principles

form the foundation of Kesko’s operations. They guide decision-making, support

management and create the prerequisites for long-term and sustainable business.

The positive impacts of an ethical corporate culture relate to how operating principles

strengthen trust among customers, partners, employees and other stakeholders. They also

support the integration of sustainability considerations across the value chain. Breaches of

laws or operating principles may result in financial and legal consequences for Kesko, weaken

stakeholder trust and adversely affect the company’s reputation.

Resilience of strategy and business model

Kesko’s strategy implementation and business model, consisting of three divisions, is not

critically dependent on individual customers, supply chains or product categories. Overall,

Kesko’s business model is assessed to adapt well in relation to the individual material

sustainability matters identified. For the reasons described above, Kesko has not prepared a

separate analysis on the resilience of its strategy and business model in addressing material

sustainability matters. Kesko has also not identified a need to make changes to its strategy or

business model.

In Kesko’s business model, the most significant sustainability impacts are associated with

products purchased by Kesko and sold onwards to customers. The key climate- and nature-

related impacts arise either in the upstream value chain from the manufacturing of products

or in the downstream value chain from the use and consumption of products. Kesko’s

business model depends on functioning supply chains, which highlights, particularly in the

upstream value chain, effective supplier relationships and the implementation of ethical

operating principles within those business relationships.

The range of products sold is constantly changing as manufacturers develop new products

and discontinue older products from their assortments. Sustainability considerations are an

increasingly important part of product development and the introduction of new products to

the market. As a trading sector operator, Kesko’s role is to actively make new products

available to customers, understand how demand develops and respond to customers’

changing requirements. These requirements are also influenced by sustainability

considerations. In addition, legislation related to products, raw materials and sustainability

information is continuously evolving.

Kesko operates between suppliers and customers. The product offering is shaped by

products introduced to the market by suppliers and by customer demand. Kesko’s strategy

and business model adapt between these two factors.

Kesko has identified a strategic development initiative in particular to reduce greenhouse gas

emissions generated in the value chain. In 2025, approximately 96% of Kesko’s value chain

greenhouse gas emissions arose from the manufacturing of purchased products and the use

of sold products. Kesko will start preparing a transition plan to reduce value chain

greenhouse gas emissions in 2026.

Sustainability-related risks in Kesko’s business model are primarily associated with evolving

and tightening sustainability regulation, the safety of products sold, and data protection. In

addition, through its business relationships, Kesko is connected to value chain workers,

which involves a risk of breaches of the K Code of Conduct and of human rights violations

affecting workers. Such breaches may cause reputational damage and disruptions to

business operations, and may lead to a need to identify alternative suppliers.

As at the end of the reporting period, Kesko had not identified any financial impacts arising

from sustainability risks on the Group’s financial position, financial performance or cash

flows that would have required recognition or disclosure in the consolidated financial

statements. On the basis of the transitional provisions, Kesko does not include in the

sustainability statement information on the financial effects of material impacts, risks and

opportunities. The use of the transitional provisions is described in more detail in the section

General information, Basis for preparation.

Kesko has set sustainability targets, and further information on the setting of the targets and

progress made is provided in connection with each topical section. The targets have been set

as part of Kesko Group’s sustainability strategy, division-specific sustainability strategies or

the HR strategy. The target related to improving energy efficiency is part of Kesko’s energy

strategy. The sustainability statement includes those targets that contribute to addressing

the material impacts, risks and opportunities identified in the double materiality assessment.

Key stakeholders have not been significantly involved in the target-setting process.


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Impact, risk and opportunity management

Identification and assessment of material impacts, risks

and opportunities (IRO-1)

Kesko has conducted a double materiality assessment in accordance with the requirements

of ESRS 1 General Requirements. The purpose of this assessment is to identify sustainability-

related impacts, risks and opportunities. The material impacts, risks and opportunities

identified through the assessment determine the disclosures presented in the sustainability

statement.

The double materiality assessment includes an impact assessment, which evaluates how

Kesko’s operations affect the environment, people and society. In the assessment of financial

materiality, Kesko identifies sustainability topics that pose risks to, or create opportunities

for, the business, and which may have an effect on Kesko’s financial performance

and position.

Kesko has updated its double materiality assessment for the 2025 reporting period. The

material impacts, risks and opportunities identified in the double materiality assessment, as

well as changes in material impacts, risks and opportunities compared to the previous

reporting period, are described in the sustainability statement section Material impacts, risks

and opportunities and their interaction with strategy and business model (SBM-3).

The double materiality assessment for 2025 is primarily based on the material impacts, risks

and opportunities identified in the 2024 assessment, as a full-scale process for identifying

and assessing impacts, risks and opportunities was not conducted in 2025.

For the 2025 reporting period, the sustainability matters identified as material in the double

materiality assessment, as well as their related impacts, risks and opportunities, were

reviewed and their materiality was confirmed. No significant changes were assessed to have

occurred in Kesko’s business operations or operating environment that would affect the

impacts, risks or opportunities assessed as material in the previous assessment.

The updated double materiality assessment for the 2025 reporting period was presented to

the Group Management Board in September 2025 and to the Audit Committee in October

2025. The update related to climate-related risks was presented to the Audit Committee in

December 2025.

In the 2024 double materiality assessment process, impacts were identified in topic-specific

workshops and scored to achieve preliminary prioritisation. After the workshops, the impact

scores were reviewed to ensure consistency and to avoid over- or underestimation of any

impact. Impacts were assessed based on their severity and likelihood. The severity of an

impact is determined by its scale, scope and, in the case of negative impacts, its

remediability.

The identification and assessment of risks and opportunities was conducted as part of

Kesko’s risk management process, which follows the methodology of the COSO Enterprise

Risk Management model. The assessment of risks and opportunities was carried out by

division, after which a Group-level assessment was formed. The sustainability risk

assessment was also reviewed alongside other risks identified in the Group’s risk

assessments. Risks and opportunities were evaluated based on their financial impact and

likelihood. The assessment examined potential risks or opportunities arising from identified

impacts. Potential negative impacts related to value chain employees, product safety and

data protection also carry the risk of negative financial impacts for Kesko. The same scale,

commonly used in Kesko’s risk management process, was applied in the risk assessment. No

material opportunities were identified in the assessment.

The majority of the assessment of impacts, risks and opportunities was conducted internally

within the Group. Experts from all three of Kesko’s divisions and common functions

participated in this work. In the impact assessment, topic-specific workshops included a

broad range of Kesko personnel, including representatives from sustainability and sourcing

functions in the divisions, as well as staff from finance, risk management, legal affairs and

HR. The assessment of risks and opportunities involved the sustainability directors and

finance directors of the divisions. Kesko’s risk management unit was responsible for

coordinating the process.

Stakeholder consultations were conducted through separate interviews, with a focus on

financial market participants, suppliers and B2B customers. Through these interviews,

information was gathered on how stakeholders view the key impacts, risks and opportunities

of Kesko’s operations across various sustainability topics. The interviews also served to


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validate the existing view of material sustainability topics for Kesko. The results of the

internally conducted double materiality assessment and the stakeholder interviews

supported each other, and no changes to the identified material impacts, risks or

opportunities were deemed necessary based on stakeholder feedback. Kesko’s double

materiality assessment did not include consultations with communities directly affected by

the company’s impacts.

Identification and assessment of topic-specific impacts, risks and

opportunities

Environment

E1 Climate change

Kesko’s impacts on climate change arise from greenhouse gas emissions generated both in

its own operations and in the value chain. Kesko has identified the key sources of emissions

in its own operations. The largest source of scope 1 emissions is the emissions from fuel

usage in transportation and logistics operations. The largest source of scope 2 emissions is

emissions from district heating consumption. Most of the value chain emissions arise during

the life cycle of purchased and sold products, from their production, use and end-of-life

treatment. In addition, emissions are generated from the manufacture of fixed assets,

logistics transport and K-retailers’ store operations.

The emission sources described above represent so-called energy and industrial emissions.

In addition to these, Kesko’s operations generate land use-related emissions. Land use-

related emissions from Kesko’s own operations arise from land-use change, when forest or

other natural land on land areas owned by Kesko is converted into built land. The majority of

land use-related emissions arise in the value chain, primarily in the primary production of

food products. Kesko has identified land use-related emissions as a significant source of

emissions in addition to energy and industrial emissions.

During 2025, Kesko carried out a division-specific review of climate-related risks. In the

review, each of Kesko’s three divisions conducted its own assessment of the most significant

climate-related risks relevant to the division. In addition, a separate review was carried out

for Kesko’s real estate operations. Climate scenarios were not used in the identification and

assessment of climate-related risks. Based on this review, no material climate-related risks

were identified at Group level in Kesko’s operations.

E2 Pollution

Pollution-related potential negative impacts in Kesko’s own operations and in the product

value chain did not, in the double materiality assessment, exceed the materiality threshold

and therefore did not emerge as material impacts.

In Kesko’s own operations, potential negative impacts were identified in relation to pollution

of soil in properties owned and leased by Kesko. However, the nature of Kesko’s operations

does not pose a significant risk of pollution of soil and the potential impacts are limited to a

small geographical area. Based on historical data, there may have been a few isolated cases

each year where soil has been decontaminated at Kesko sites. As part of the double

materiality assessment process, Kesko has not conducted a separate review of its assets or

operations specifically to identify pollution-related impacts.

In addition to pollution of soil, impacts were identified in relation to microplastics and to

products in Kesko’s product range classified as substances of concern. In the product value

chain, negative impacts were identified in particular in primary food production and the

manufacturing industry.

E3 Water and marine resources

Potential negative impacts related to water and marine resources in Kesko’s own operations

and in the product value chain did not, in the double materiality assessment, exceed the

materiality threshold and therefore did not emerge as material impacts.

In Kesko’s own operations, water consumption is not significant. The municipal water supply

is mainly used for water consumption in operations and the municipal sewer system for

wastewater treatment. Kesko’s operations do not involve water withdrawal from ground or

surface water. As part of the double materiality assessment process, Kesko has not

conducted a separate review of its assets or operations specifically to identify impacts

related to water consumption.

Negative impacts related to water were identified in the upstream value chain of products in

primary production, particularly through products originating in areas suffering from water

scarcity or through products whose production processes require significant volumes of

water. Issues related to water use are considered when making selection and sourcing

decisions on products and product categories with identified water-related impacts.


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However, given the breadth of Kesko’s product range, the negative impacts identified in the

product value chain did not exceed the threshold for a material impact.

Kesko’s product selection includes fish and shellfish, and a negative impact was identified in

relation to the exploitation and use of marine resources. The fish and shellfish selection is

managed to ensure it does not include endangered species. The share of fish and shellfish

products in Kesko’s operations is not significant and therefore did not exceed the materiality

threshold.

E4 Biodiversity and ecosystems

Kesko’s product assortment includes products that have significant nature‑related impacts.

The most material impact identified relates specifically to the direct drivers of biodiversity

loss. Land‑use and water‑use changes occur within Kesko’s value chain particularly in

primary production, such as agriculture, forestry, mining and fishing.

Kesko assessed the risks and geographical scope of land‑use change in its supply chains

based on the LEAP (Locate, Evaluate, Assess and Prepare) methodology. The assessment

also utilised the Science Based Targets for Nature (SBTN) High Impact Commodity (HIC) list

to identify product groups with significant environmental impacts. The assessment covered

product categories across all Kesko divisions. Risks were mapped by product category by

identifying the key product categories with biodiversity impacts, as well as their nature-

related risks and dependencies using the ENCORE tool. The supply chains of the identified

key product categories were studied at country level, for the largest supply countries in each

of the supply chains examined. The method enabled us to identify the key countries in

Kesko’s global supply chains, and in those countries the key biomes for which the land-use

change risk was assessed using the WWF Risk Filter tool. The assessment was initiated in

2024 and completed in 2025.

Transition risks associated with nature‑related dependencies are most relevant for divisions

whose raw materials are highly dependent on agriculture. Kesko’s value chain is extensive

and consists of diverse product categories, which limits the impact of any single physical or

transition risk on the business as a whole. No material nature‑related physical or transition

risks were identified in the assessment.

The assessment also covered the mapping of nature-related impacts in Kesko’s own

operations. In Kesko’s own operations, the assessment focused on identifying nature-related

impacts at Kesko’s sites. During 2024, Kesko examined the scale and significance of land‑use

change related to its construction activities and property portfolio, based on the LEAP

methodology. As part of this analysis, the land‑use categories of Kesko’s owned and leased

properties were identified through geospatial analysis using land‑use datasets. The

significance of land‑use change was assessed by calculating the share of vegetated areas in

the immediate vicinity of the properties’ coordinate points and by using values from WWF’s

Risk Filter tool to evaluate risks related to land‑use change.

In Finland, 80% of the sites surveyed were located in areas where they are not expected to

have negative impacts on protected areas. Of the sites, 19% were located in the vicinity of

protected area under Finland’s Nature Conservation Act and 1% in the immediate vicinity.

The distances of the sites from habitats of special importance under the Forest Act were also

examined. Based on this, 97% of the sites were located in areas where they are not expected

to have impacts on important habitats. Of the sites, 3% were located in the vicinity of

important habitats. No Kesko sites were located in the immediate vicinity of important

habitats.

For sites in the other operating countries, the distance to the areas in the World Database on

Protected Areas (WDPA), and to the areas in the database of European protected sites

maintained by the EU’s Environmental Environment Agency (EEA), was determined. Of all

the operating countries’ sites 11% were located in the vicinity of a protected area. Of the

sites, 89% were located at a distance from the protected area where they are not expected to

have negative impacts on the protected area.

Construction is highly regulated, and Kesko complies with all statutory requirements and

authority‑mandated obligations in its construction projects. Kesko primarily builds retail sites

and other properties on areas zoned for business use. Required nature assessments and

other environmental reviews are carried out during the permitting processes of construction

projects. In Kesko’s large logistics centre projects, environmental impact assessments (EIA),

for example, have been required.

Based on the assessment, Kesko’s own operations do not entail material impacts on

biodiversity or ecosystems.


		40

E5 Resource use and circular economy

In terms of resource use, resource outflows are generated particularly from packaging. The

product’s logistical chain includes several packages, from logistics packaging to the sales

packaging of a single product.

Material negative impacts on the environment arise from the waste generated by Kesko’s

operations, particularly as part of warehousing and logistics operations and retail trade

operations. The largest waste fraction in Kesko’s operations is cardboard, which is generated

from packaging used during the transportation and storage of products. The waste

generated by Kesko’s operations is mainly non-hazardous waste, and the amount of

hazardous waste in Kesko’s operations is low. As part of the double materiality assessment

process, Kesko has not conducted a separate review of its assets or operations specifically to

identify waste-related impacts.

As a food industry operator, preventing food waste also plays a key role in Kesko’s

operations. Food waste is generated as part of warehousing and logistics operations and in

wholesale operations in Kesko’s grocery trade division. However, the most significant aspect

in preventing food waste is the prevention of food waste in the downstream value chain in

K-food retailers’ store operations, where most of the food waste is generated.

People, society and governance

S1 Own workforce and S2 Workers in the value chain

With regard to the own workforce, both actual and potential positive impacts were

identified. Actual negative impacts were identified in relation to health and safety. With

regard to workers in the value chain, potential negative impacts were identified related to

working conditions and to the risk of child labour and forced labour. The review was carried

out using a risk-based approach, taking into account both countries classified as high-risk

and, more broadly, different geographical areas. The risk of breaches of the K Code of

Conduct has been assessed to be highest in countries classified as high-risk, however,

negative impacts affecting value chain workers have also come to Kesko’s attention in other

geographical areas. The risk has typically been found to arise from a combination of

geographical location and certain product categories or raw materials.

S3 Affected communities

The nature of Kesko’s business, where operations are spread across numerous locations

within its operating area and the operating area is concentrated in Northern Europe, does

not result in impacts that would, in relation to the topics covered by the standard, be

considered material for the communities concerned.

G1 Business conduct

Ensuring ethical and transparent business conduct, as well as compliance with laws and

regulations, is essential in Kesko’s operations. The prevention of corruption and bribery,

together with the whistleblower protection provided through the SpeakUp channel, supports

the implementation of an ethical business culture across the value chain. In Kesko’s

operations, the areas identified as presenting specific risks related to corruption and bribery

include real estate and store site operations, the sourcing of goods and services,

participation in public procurement processes, operations in new geographical and business

areas, interactions with public officials, and corporate transactions. Impacts related to

corporate culture, the prevention of corruption and bribery, and the functioning of

whistleblower protection were assessed as material in Kesko’s operating environment.

Kesko has defined K Code of Conduct guidelines for its suppliers of goods and services, with

the aim of promoting ethical business practices in the procurement chain and supporting

responsible conduct throughout the value chain.

Increasing sustainability‑related regulation and the potential changes it may require to

Kesko’s business model, as well as possible future investment needs to ensure compliance

with regulatory requirements, were identified as a risk which, if realised, may influence

Kesko’s resource allocation.


		41

Disclosure requirements in ESRS covered by the

undertaking’s sustainability statement (IRO-2)


ESRS 2 General disclosures	Page
BP-1 General basis for preparation of sustainability statements	22
BP-2 Disclosures in relation to specific circumstances	23
GOV-1 Disclosures in relation to specific circumstances	25
GOV-2 Information provided to and sustainability matters addressed by the undertaking’s administrative, management and supervisory bodies	27
GOV-3 Integration of sustainability-related performance in incentive schemes	28
GOV-4 Statement of due diligence	28
GOV-5 Risk management and internal controls over sustainability reporting	28
SBM-1 Strategy, business model and value chain	29
SBM-2 Interests and views of stakeholders	31
SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model	32
IRO-1 Description of the processes to identify and assess material impacts, risks and opportunities	37
IRO-2 Disclosure requirements in ESRS covered by the undertaking’s sustainability statement	41
Environment
E1 Climate change
E1-1 Transition plan for climate change mitigation	55
E1-2 Policies related to climate change mitigation and adaptation	56
E1-3 Actions and resources in relation to climate change policies	57
E1-4 Targets related to climate change mitigation and adaptation	59
E1-5 Energy consumption and mix	63
E1-6 Gross Scopes 1, 2, 3 and Total GHG emissions	64
E1-7 GHG removals and GHG mitigation projects financed through carbon credits	55
E1-8 Internal carbon pricing	55
E5 Resource use and circular economy
E5-1 Policies related to resource use and circular economy	73
E5-2 Actions and resources related to resource use and circular economy	73
E5-3 Targets related to resource use and circular economy	74
E5-5 Resource outflows	76



Social	Page
S1 Own workforce
S1-1 Policies related to own workforce	80
S1-2 Processes for engaging with own workers and workers’ representatives about impacts	82
S1-3 Processes to remediate negative impacts and channels for own workers to raise concerns	82
S1-4 Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions	83
S1-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	85
S1-6 Characteristics of the undertaking’s employees	87
S1-8 Collective bargaining coverage and social dialogue	89
S1-9 Diversity metrics	89
S1-10 Adequate wages	90
S1-13 Training and skills development metrics	90
S1-14 Health and safety metrics	91
S1-16 Compensation metrics (pay gap and total compensation)	91
S1-17 Incidents, complaints and severe human rights impacts	92
S2 Workers in the value chain
S2-1 Policies related to value chain workers	94
S2-2 Processes for engaging with value chain workers about impacts	95
S2-3 Processes to remediate negative impacts and channels for value chain workers to raise concerns	95
S2-4 Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those action	96


		42


S4 Consumers and end-users	Page
S4-1 Policies related to consumers and end-users	100
S4-2 Processes for engaging with consumers and end-users about impacts	102
S4-3 Processes to remediate negative impacts and channels for consumers and end-users to raise concerns	102
S4-4 Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end- users, and effectiveness of those actions	103
S4-5 Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	104
Governance
G1 Business conduct
G1-1 Corporate culture and business conduct policies and corporate culture	106
G1-2 Management of relationships with suppliers	108
G1-3 Prevention and detection of corruption and bribery	108
G1-4 Confirmed incidents of corruption or bribery	109


		43

ENVIRONMENTAL INFORMATION

EU TAXONOMY

Kesko’s reporting on EU Taxonomy complies with

Regulation (EU) 2020/852 of the European Parliament

and of the Council (18 June 2020). The EU Taxonomy

is a classification system for sustainable financing,

designed to help companies and investors assess

whether an economic activity can be considered

environmentally sustainable. The Taxonomy defines a

set of criteria for a business activity that enables

companies to assess to what extent the company’s

activities support the attainment of environmental and

climate objectives.

Companies shall disclose information on how and to

what extent their activities can be deemed

environmentally sustainable in the manner referred to

in the EU Taxonomy based on six climate and

environmental objectives:

• Climate change mitigation

• Climate change adaptation

• The sustainable use and protection of water and

marine resources

• The transition to a circular economy

• Pollution prevention and control

• The protection and restoration of biodiversity and

ecosystems

Key performance indicators are presented for Taxonomy-

eligible activities and Taxonomy-aligned activities. These

indicators are the proportion of the company’s net sales

(turnover), capital expenditure (CapEx), and operating

expenditure (OpEx) as defined in the Taxonomy.

Currently, the Taxonomy does not specifically mention

activities that are typical of the trading sector, meaning that

trading sector companies report on Taxonomy-eligible

activities if they engage in them. It is likely that the

Taxonomy will include an expanding number of activities,

and that assessment criteria will be established

consequently also for the trading sector and possibly for its

different product segments.

Taxonomy-eligible activities and

assessing Taxonomy alignment

Kesko has identified the car leasing operations and sales of

used cars in its car trade division and the owning, leasing

and construction of properties for own business needs as

Taxonomy-eligible activities in its operations. In addition,

logistics operations in Denmark are identified as a

Taxonomy-eligible activity.

With each Taxonomy-eligible activity, Kesko has assessed

its Taxonomy alignment. Taxonomy alignment has been

determined by assessing whether an activity significantly

contributes to at least one of the climate and environmental

objectives. The assessment of Taxonomy alignment is made

based on the technical screening criteria applied for each

activity. In addition to meeting said criteria, Kesko has

confirmed that the activity does not cause significant harm

to the other climate and environmental objectives referred

to in the Taxonomy Regulation, using the separate DNSH

(‘Does Not Significantly Harm’) criteria, and that minimum

safeguards under the Taxonomy Regulation are met.

Kesko has examined the implementation of minimum

safeguards in relation to human rights, corruption and

bribery, fair competition, and taxation. As a result of the

review, Kesko concludes that the minimum safeguards are

being met in all of the four areas in Kesko’s operations.

The following table presents the activities identified by

Kesko as Taxonomy-eligible, and Kesko’s assessments of

their Taxonomy alignment.


		44


				Performance indicators
Taxonomy activity		Activity description	Assessment of Taxonomy alignment	Turnover	CapEx	Opex
Objective: Climate change mitigation (CCM)
CCM 6.5	Transport by motorbikes, passenger cars and light commercial vehicles	Purchase, financing, renting, leasing and operation of vehicles designated as category M1, N1 or L. The activity includes leasing operations in the car trade division.	The significant contribution criterion is met if the vehicle’s emissions are below 50 g CO2/km. This criterion is met by fully electric vehicles and hybrids. The activity is subject to 'do no significant harm' criteria. However, the data required to assess alignment is not available, and alignment of the vehicles with the classification system cannot be verified. Vehicles in the leasing business are classified as Taxonomy-eligible but not Taxonomy-aligned.	√	√	√
CCM 6.6	Freight transport services by road	Purchase, financing, renting, leasing and operation of vehicles designated as category N1, N2 or N3 for freight transport serivces by road. Activity includes vehicles used in logistics operations of in Davidsen Koncernen A/S in Denmark.	To meet the Taxonomy criteria, the vehicles must be low-emission or zero-emission vehicles. The vehicles are also not dedicated for the transportation of fossil fuels. Additionally, the vehicles must comply with the 'do no significant harm' criteria set for the activity. The logistics vehicles are classified as Taxonomy-eligible but not Taxonomy-aligned.		√	√
CCM 7.1	Construction of new buildings	The construction of buildings for residential and non-residential use. The activity includes building projects developed by Kesko for its own use. These are mainly new store and logistics properties.	For new buildings, an energy efficiency rating (E-value) is defined during the planning phase, which must be at least ten percent lower than the nationally set threshold. An assessment of the building’s Taxonomy alignment is made during the planning phase. The realisation of the E-rating is verified upon the building’s completion. Energy efficiency must be certified with an Energy Performance Certificate. Additionally, the activity sets criteria for buildings over 5,000 m² regarding air-tightness and thermal integrity of the building. The activity also includes detailed 'do no significant harm' criteria. The criteria for Taxonomy alignment are considered already during the planning phase of the building, when the decision to construct the building in accordance with the criteria is made.		√
CCM 7.2	Renovation of existing buildings	Extensive repairs to existing buildings. Major refurbishments or extensions in properties owned by Kesko, as well as in leased premises where Kesko is responsible for refurbishments.	Building renovations comply with the requirements applied to major renovations. Alternatively, the renovations lead to a reduction of primary energy demand of at least 30 %. The activity also includes detailed 'do no significant harm' criteria. Large renovations have not been deemed Taxonomy-aligned, as the ‘do no significant harm’ criteria for Taxonomy alignment related to activity 7.2 have not been met.		√
CCM 7.3	Installation, maintenance and repair of energy efficiency equipment	Individual renovation measures related to energy efficiency equipment, such as energy efficient replacements for external doors and windows, installing energy efficient light sources, and the installation, maintenance, repair and replacement of ventilation equipment with efficient technologies. The activity mainly includes the above-mentioned renovation measures in Kesko store sites where Kesko is the lessee.	The information available is not detailed enough to assess compliance with the criteria applicable to the activity, and Taxonomy alignment cannot therefore be determined. Investments related to the activity are classified as Taxonomy-eligible, but not Taxonomy-aligned.		√


		45


				Performance indicators
Taxonomy activity		Activity description	Assessment of Taxonomy alignment	Turnover	CapEx	Opex
Objective: Climate change mitigation (CCM)
CCM 7.4	Installation, maintenance and repair of charging stations for electric vehicles in buildings	The installation, maintenance and repair of charging stations for electric vehicles in buildings and parking spaces attached to buildings. The activity covers Kesko’s K-Lataus stations in Finland and charging stations installed at store sites in Kesko’s other operating countries.	All investments related to the activity have been classified as Taxonomy-aligned.		√
CCM 7.5	Installation, maintenance and repair of instruments and devices for measuring, regulation and controlling energy performance of buildings	The installation, maintenance and repair of instruments and devices for measuring, regulation and controlling energy performance of buildings. The activity covers the aforementioned capital expenditures in properties where Kesko is a lessee.	When the activity consists of individual measures listed in the Taxonomy Regulation, all investments related to the activity have been classified as Taxonomy-aligned.		√
CCM 7.6	Installation, maintenance and repair of renewable energy technologies	Individual measures related to renewable energy sources, where the technology is installed on-site as part of the building's technical systems. The activity covers the aforementioned capital expenditures in properties where Kesko is a lessee.	When the activity consists of individual measures listed in the Taxonomy Regulation, all investments related to the activity have been classified as Taxonomy-aligned.		√
CCM 7.7	Acquisition and ownership of buildings	Buying real estate and exercising ownership of that real estate. The activity includes properties acquired during the reporting period, and the amounts of right-of-use assets recognised in the balance sheet based on lease agreements for properties. Moreover, capital expenditure in properties owned by Kesko in line with the above-mentioned activities 7.3 and 7.5 and activity 7.6 have been included in activity 7.7 ‘Acquisition and ownership of buildings’.	For buildings built after 2020, the assessment of Taxonomy alignment has been made based on the climate change mitigation substantial contribution criteria of activity 7.1. ‘Construction of new buildings’. A building built during or before 2020 must have at least a category A energy certificate, or the building must be in the top 15% in the region in terms of primary energy demand. The assessment method is mainly applied to leased properties. A climate risk assessment is also conducted for the buildings.		√	√
Objective: Circular economy (CE)
CE 5.4	Sale of second-hand goods	The sale of second-hand goods that have been used for their intended purpose before by a customer. In Kesko, the sale of second-hand goods includes the used car business in the car trade division.	For used cars, the information needed to reliably assess Taxonomy alignment of the vehicles under the classification system is not available. Used cars are classified as Taxonomy-eligible but not Taxonomy- aligned.	√


		46

Kesko’s Taxonomy-eligible turnover comprises the car leasing business and sales of used

cars to customers in the car trade division.

Kesko owns and leases properties in all operating countries for business purposes. The

Group uses some 1,600 owned or leased retail, logistics and office properties. The Group’s

Taxonomy-eligible capital expenditure includes investments in new store sites and logistics

properties, investments in building improvement measures, and investments in lighting,

machinery and equipment to improve the energy efficiency of buildings, and automation for

measuring and monitoring energy efficiency. In addition, Taxonomy-eligible CapEx includes

charging equipment for electric vehicles and investments in vehicles for the leasing

operations of the car trade division. Land areas are not classified as Taxonomy-eligible

CapEx.

In addition, Taxonomy-eligible CapEx includes charging equipment for electric vehicles,

investments in vehicles for the leasing operations of the car trade division, and investments

in logistics vehicles for the building and home improvement trade business in Denmark.

Operating expenditure under the Taxonomy Regulation in Kesko Group is in particular

related to expenses for the use, maintenance and repair of properties. Taxonomy-eligible

expenses include expenses for servicing of the leasing car fleet and the logistics vehicles fleet

in Denmark.

Kesko does not have Taxonomy activities related to gas or nuclear power.

Activities related to nuclear power and fossil gas


	Nuclear energy related activities
1.	The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle.	NO
2.	The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies.	NO
3.	The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades.	NO


	Fossil gas related activities
4.	The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels.	NO
5.	The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels.	NO
6.	The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels.	NO

EU Taxonomy performance indicators

Kesko presents the performance indicators for turnover, capital expenditure (CapEx) and

operating expenditure (OpEx) in accordance with the tables determined for non-financial

undertakings in the Taxonomy Regulation. The tables for the performance indicators disclose

the proportion of turnover, capital expenditure and operating expenditure attributable to

Taxonomy-eligible and Taxonomy-aligned economic activities.

Accounting policies

Turnover

When calculating the performance indicator for turnover, Kesko applies the same IFRS

accounting principles as it does in the consolidated financial statements. The accounting

principles for revenue recognition are presented in Note 2.1 of the consolidated financial

statements.

The net sales figure used in calculating the turnover performance indicator is the Kesko

Group net sales presented in the income statement. The Taxonomy-eligible turnover is the

share of total Group net sales that comes from Taxonomy-eligible activities. In Kesko’s

business operations, car leasing operations and used car sales in the car trade division have

been identified as Taxonomy-eligible activities that generate net sales.

Kesko’s primary operations which generate net sales are the sales of products and services

to customers and retailers. Product sales are currently not a Taxonomy-eligible activity, with

the exception of used car sales.


		47

Capital expenditure (CapEx)

Capital expenditure (CapEx) as defined in the Taxonomy Regulation includes additions to

tangible and intangible assets during the financial year, before depreciation, amortisation

and any re-measurements. Capital expenditure also includes additions to tangible and

intangible assets resulting from business combinations. In accordance with the Taxonomy

Regulation, Kesko includes in its CapEx calculation investments in tangible and intangible

assets and the aggregate sum of additions to the right-of-use assets recognised in the

balance sheet based on lease agreements. Goodwill recorded in acquisitions is not included

in the Taxonomy CapEx definition. Additions to property, plant and equipment are

presented in Note 3.2, additions to intangible assets in Note 3.3, and additions to right-of-

use assets related to leases in Note 3.4 of the consolidated financial statements.

The Taxonomy definition of CapEx differs from the definition of the ‘capital expenditure’

performance indicator reported by Kesko. In Kesko’s definition, the performance indicator

includes investments in tangible and intangible assets and subsidiary shares. The indicator

does not include additions to right-of-use assets related to leases recognised in the balance

sheet. Group capital expenditure in 2025 totalled €735.7 million (€675.9 million).

The following table details the capital expenditure items used to calculate the Taxonomy

CapEx indicator.

Capital expenditure (CapEx) under EU Taxonomy


€ million	2025	2024
Property, plant and equipment - Additions (Note 3.2)	536.7	494.9
Property, plant and equipment - Acquisitions (Note 3.2)	92.8	94.4
Intangible assets - Additions (Note 3.3)	10.4	16.2
Intangible assets - Acquisitions excluding goodwill (Note 3.3)	7.2	39.7
Right-of-use assets - Additions (Note 3.4)	459.4	457.5
Right-of-use assets - Acquisitions (Note 3.4)	2.9	12.3
Total	1,109.4	1,115.1

Operating expenses (OpEx)

Operating expenditure (OpEx) as defined in the Taxonomy Regulation includes direct non-

capitalised costs that relate to research and development, building renovation measures,

maintenance and repair, and any other direct expenditure relating to the servicing of assets

of property, plant and equipment by the undertaking or a third party to whom activities are

outsourced that are necessary to ensure the continued and effective functioning of such

assets.

In Kesko Group’s income statement, operating expenditure as defined in the Taxonomy

Regulation is included under ’Other operating expenses’, which are presented in Note 2.5 of

the consolidated financial statements.

Operating expenditure under the Taxonomy Regulation in Kesko Group is in particular

related to expenses for the use, maintenance and repair of properties – which in the

financial statements are included in ‘Property and store site maintenance expenses’ – the

total sum of which was €196.2 million (€198.5 million) in 2025. In addition to property

maintenance and repair costs, the figure includes expenses related to e.g. heating,

electricity and water consumption, and waste management, which are not included in the

Taxonomy definition of operating expenditure. In addition, Taxonomy-eligible expenses

include expenses for servicing of the leasing car fleet and the logistics vehicles fleet in

Denmark.

In Kesko’s business model, operating expenditure is not material in the transition to more

sustainable activities, but instead, building renovation measures, such as those related to

improving energy efficiency, are capital expenditure by nature.


		48

Proportion of turnover from products or services associated with Taxonomy-aligned economic activities 2025


Financial year 2025	2025			Substantial contribution criteria						DNSH criteria ('Does Not Significantly Harm')
Economic activities	Code	Turnover	Proportion of turnover, year 2025	Climate change mitigation	Climate change adaption	Water	Pollution	Circular economy	Biodiversity	Climate change mitigation	Climate change adaption	Water	Pollution	Circular economy	Biodiversity	Minimum safeguards	Proportion of Taxonomy aligned (A1) or eligible (A2) turnover, year 2024	Category enabling activity)	Category transitional activity
		€ million	%	Y; N; N/EL	Y; N; N/EL	Y; N; N/EL	Y; N; N/EL	Y; N; N/EL	Y; N; N/EL	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	Y/N	%	E	T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally sustainable activities (Taxonomy- aligned)
Turnover of environmentally sustainable activities (Taxonomy-aligned) (A.1)		0.0	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%							Y	0.0%
Of which Enabling		0.0	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%							Y	0.0%	E
Of which Transitional		0.0	0.0%	0.0%												Y	0.0%		T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
				EL; N/EL	EL; N/EL	EL; N/EL	EL; N/EL	EL; N/EL	EL; N/EL
Transportation by motorbikes, passenger cars and light commercial vehicles	CCM 6.5 CCA 6.5	32.2	0.3%	EL	EL	N/EL	N/EL	N/EL	N/EL								0.2%
Sale of second-hand goods	CE 5.4	404.8	3.2%	N/EL	N/EL	N/EL	N/EL	EL	N/EL								2.7%
Turnover of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2)		436.9	3.5%	0.3%	0.0%	0.0%	0.0%	3.2%	0.0%								2.9%
A. Turnover of Taxonomy eligible activities (A.1+A.2)		436.9	3.5%	0.3%	0.0%	0.0%	0.0%	3.2%	0.0%								2.9%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities		12,037.8	96.5%
Total		12,474.7	100.0%

Codes:

Climate change mitigation: CCM

Climate change adaptation: CCA

Circular economy: CE

Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant

environmental objective

N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the

relevant environmental objective

EL – Taxonomy-eligible activity for the relevant objective

N/EL – Taxonomy-non-eligible activity for the relevant objective


		49

Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities 2025

Financial year 2025

2025

Substantial contribution criteria

DNSH criteria

('Does Not Significantly Harm')

Economic activities

Code

CapEx

Proportion of CapEx, year 2025

Climate change mitigation

Climate change adaption

Water

Pollution

Circular economy

Biodiversity

Climate change mitigation

Climate change adaption

Water

Pollution

Circular economy

Biodiversity

Minimum safeguards

Proportion of Taxonomy aligned (A1) or

eligible (A2) CapEx, year 2024

Category enabling activity)

Category

transitional activity

€ million

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y/N

A. TAXONOMY-ELIGIBLE ACTIVITIES

A.1 Environmentally sustainable activities (Taxonomy-

aligned)

Construction of new buildings

CCM 7.1

CCA 7.1

CE 3.1

107.4

9.7%

N/EL

9.1%

Installation, maintenance and repair of charging stations for

electric vehicles in buildings

CCM 7.4

CCA 7.4

7.2

0.6%

N/EL

0.8%

Installation, maintenance and repair of instruments and

devices for measuring, regulation and controlling energy

performance of buildings

CCM 7.5

CCA 7.5

0.1

0.0%

N/EL

0.0%

Installation, maintenance and repair of renewable energy

technologies

CCM 7.6

CCA 7.6

0.2

0.0%

N/EL

0.0%

Acquisition and ownership of buildings

CCM 7.7

CCA 7.7

42.4

3.8%

N/EL

5.7%

CapEx of environmentally sustainable activities

(Taxonomy-aligned) (A.1)

157.3

14.2%

0.0%

15.6%

Of which Enabling

7.5

0.7%

0.0%

0.8%

Of which Transitional

0.0

0.0%

Codes:

Climate change mitigation: CCM

Climate change adaptation: CCA

Circular economy: CE

Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant

environmental objective

N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the

relevant environmental objective

EL – Taxonomy-eligible activity for the relevant objective

N/EL – Taxonomy-non-eligible activity for the relevant objective


		50

Financial year 2025

2025

Substantial contribution criteria

DNSH criteria

('Does Not Significantly Harm')

Economic activities

Code

CapEx

Proportion of CapEx, year 2025

Climate change mitigation

Climate change adaption

Water

Pollution

Circular economy

Biodiversity

Climate change mitigation

Climate change adaption

Water

Pollution

Circular economy

Biodiversity

Minimum safeguards

Proportion of Taxonomy aligned

(A1) or eligible (A2) CapEx,

year 2024

Category enabling activity)

Category

transitional activity

€ million

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y/N

A.2 Taxonomy-eligible but not environmentally

sustainable activities (not Taxonomy-aligned activities)

EL;

N/EL

EL;

N/EL

EL;

N/EL

EL;

N/EL

EL;

N/EL

EL;

N/EL

Transportation by motorbikes, passenger cars and light

commercial vehicles

CCM 6.5

CCA 6.5

86.8

7.8%

N/EL

4.7%

Freight transport services by road

CCM 6.6

CCA 6.6

1.9

0.2%

N/EL

0.4%

Construction of new buildings

CCM 7.1

CCA 7.1

CE 3.1

28.3

2.5%

N/EL

2.4%

Renovation of existing buildings

CCM 7.2

CCA 7.2

CE 3.2

80.5

7.3%

N/EL

9.2%

Installation, maintenance and repair of energy efficiency

equipment

CCM 7.3

CCA 7.3

1.6

0.1%

N/EL

0.3%

Acquisition and ownership of buildings

CCM 7.7

CCA 7.7

446.8

40.3%

N/EL

43.2%

CapEx of Taxonomy-eligible but not environmentally

sustainable activities (not Taxonomy-aligned activities)

(A.2)

645.9

58.2%

60.3%

0.0%

60.3%

A. CapEx of Taxonomy eligible activities (A.1+A.2)

803.2

72.4%

75.9%

0.0%

75.9%

B. TAXONOMY-NON-ELIGIBLE ACTIVITIES

CapEx of Taxonomy-non-eligible activities

306.2

27.6%

Total

1,109.4

100.0%

Codes:

Climate change mitigation: CCM

Climate change adaptation: CCA

Circular economy: CE

Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant

environmental objective

N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the

relevant environmental objective

EL – Taxonomy-eligible activity for the relevant objective

N/EL – Taxonomy-non-eligible activity for the relevant objective


		51

Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities 2025

Financial year 2025

2025

Substantial contribution criteria

DNSH criteria

('Does Not Significantly Harm')

Economic activities

Code

OpEx

Proportion of OpEx,

year 2025

Climate change

mitigation

Climate change

adaption

Water

Pollution

Circular economy

Biodiversity

Climate change

mitigation

Climate change

adaption

Water

Pollution

Circular economy

Biodiversity

Minimum safeguards

Proportion of

Taxonomy aligned

(A1) or eligible (A2)

OpEx, year 2023

Category enabling

activity)

Category

transitional activity

€ million

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y; N;

N/EL

Y/N

A. TAXONOMY-ELIGIBLE ACTIVITIES

A.1 Environmentally sustainable activities (Taxonomy-

aligned)

OpEx of environmentally sustainable activities

(Taxonomy-aligned) (A.1)

0.0

0.0%

Of which Enabling

0.0

0.0%

Of which Transitional

0.0

0.0%

A.2 Taxonomy-eligible but not environmentally

sustainable activities (not Taxonomy-aligned activities)

EL;

N/EL

EL;

N/EL

EL;

N/EL

EL;

N/EL

EL;

N/EL

EL;

N/EL

Transportation by motorbikes, passenger cars and light

commercial vehicles

CCM 6.5

CCA 6.5

1.9

2.9%

N/EL

2.8%

Freight transport services by road

CCM 6.6

CCA 6.6

1.4

2.2%

N/EL

1.4%

Acquisition and ownership of buildings

CCM 7.7

CCA 7.7

63.3

95.0%

N/EL

95.8%

OpEx of Taxonomy-eligible but not environmentally

sustainable activities (not Taxonomy-aligned activities)

(A.2)

66.6

100.0%

0.0%

100.0%

A. OpEx of Taxonomy eligible activities (A.1+A.2)

66.6

100.0%

0.0%

100.0%

B. TAXONOMY-NON-ELIGIBLE ACTIVITIES

OpEx of Taxonomy-non-eligible activities

0.0

0.0%

Total

66.6

100.0%

Codes:

Climate change mitigation: CCM

Climate change adaptation: CCA

Circular economy: CE

Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant

environmental objective

N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the

relevant environmental objective

EL – Taxonomy-eligible activity for the relevant objective

N/EL – Taxonomy-non-eligible activity for the relevant objective


		52

Taxonomy eligibility and alignment per environmental objective


	Proportion of turnover / Total turnover
	Taxonomy-aligned per objective	Taxonomy-eligible per objective
CCM	0.0%	0.3%
CCA	0.0%	0.0%
WTR	0.0%	0.0%
CE	0.0%	3.2%
PPC	0.0%	0.0%
BIO	0.0%	0.0%

CCM: Climate change mitigation

CCA: Climate change adaptation

WTR: Water and marine resources

CE: Circular economy

PPC: Pollution prevention and control

BIO: Biodiversity and ecosystems


	Proportion of CapEx / Total CapEx
	Taxonomy-aligned per objective	Taxonomy-eligible per objective
CCM	14.2%	58.2%
CCA	0.0%	0.0%
WTR	0.0%	0.0%
CE	0.0%	0.0%
PPC	0.0%	0.0%
BIO	0.0%	0.0%


	Proportion of OpEx / Total OpEx
	Taxonomy-aligned per objective	Taxonomy-eligible per objective
CCM	0.0%	100.0%
CCA	0.0%	0.0%
WTR	0.0%	0.0%
CE	0.0%	0.0%
PPC	0.0%	0.0%
BIO	0.0%	0.0%


		53

E1 CLIMATE

CHANGE


Transition plan for climate change mitigation (E1-1) ...............................................	55
Policies (E1-2) ..................................................	56
Actions (E1-3) ..................................................	57
Targets and progress towards targets (E1-4) ................................................................	59
Metrics ..............................................................	63
Energy consumption and mix (E1-5) ..............	63
Greenhouse gas emissions (E1-6) ..................	64

Material impacts, risks and opportunities (ESRS 2 SBM-3)

Material impacts, risks and opportunities


Topic	Description	Management
Climate change mitigation	Actual negative impact: Kesko‘s own operations generate greenhouse gas (GHG) emissions (scope 1 and 2). The most significant source of scope 1 emissions are the fuel emissions of transportation and logistics. The most significant source of scope 2 emissions are district heating consumption emissions.	• Kesko has set climate targets for reducing the emissions from its own operations (scope 1 and 2). The Science Based Targets initiative validated Kesko's climate targets in January 2026. • The most significant investments to reduce energy and industrial emissions are related to the electrification of the logistics fleet and improving energy efficiency by installing energy recycling systems.
Climate change mitigation	Actual negative impact: Kesko‘s value chain generates GHG emissions (scope 3). Most of the value chain emissions arise during the life cycle of purchased and sold products, from their production, use, and end-of-life treatment. Additionally, emissions are generated from the manufacturing of capital goods and upstream transportation.	• Kesko has set new near-term and long-term climate targets for its value chain (scope 3). The Science Based Targets initiative validated Kesko's climate targets in January 2026. • Preparatory work to build transition plan for Kesko's value chain emissions (scope 3) started at the end of 2025. • Suppliers are encouraged to set their own science-based emission reduction targets.
Energy	Actual negative impact: The consumption of fossil energy sources in properties owned and managed by Kesko and in transport and logistics generates GHG emissions.	• Reducing the consumption of fossil energy sources by electrifying transport, improving energy efficiency, and increasing the share of renewable and emission-free energy sources in energy consumption.


		54

Climate risks and resilience assessment

Kesko has assessed the financial impacts of climate change on its operations. No material

climate-related risks have been identified in the Group’s operational risk map, where the

review period is 12 months.

In assessing sustainability-related risks, it is essential to consider medium- and long-term risk

horizons. The medium- and long-term periods used in the risk assessment correspond to the

definitions used by ESRS, where the medium term extends five years from the end of the

short term, and the long term is from five years onwards. Climate scenarios were not used in

the identification and assessment of climate risks.

Physical risks

Physical climate risks associated with operations were particularly identified in relation to the

effects of extreme weather events in properties owned and leased by Kesko, as well as in the

product supply chain, such as disruptions in product availability.

Kesko owns and manages a significant number of properties under lease agreements in all

operating countries. These properties are exposed to physical risks related to climate

change. In the future, increasing extreme weather events may increase the strain on

properties and the costs associated with maintenance and repairs. Individual assets may be

subject to damage risks or investment needs due to extreme weather events. The most

significant extreme weather events in Kesko's operating countries are linked to chronic

climate risks, such as heat stress and changes in rainfall patterns and types. Acute risks are

related to heatwaves, storms, heavy rains, and floods. Future weather conditions are

modelled, for example, using forward-looking weather data, and the risks are considered in

real estate project planning guidelines.

At the time of the assessment, Kesko has not identified material climate risks related to

assets that could lead to asset impairment or have significant impacts on business continuity.

Annually, Kesko's retail locations may experience, for example, floods or leaks in property

structures caused by heavy rainfall, but these disruptions have not caused significant impacts

or interruptions to business operations in the affected locations.

Extreme weather events, such as drought, heavy rainfall, and cold spells, may lead to

disruptions in product availability. Intensified storms, increased rainfall, sudden floods, and

prolonged droughts particularly affect agriculture and the production of raw materials and

food. Increasing extreme weather events raise the risk of disruptions in global supply chains.

The impacts may be seen on product availability, quality, and price. Managing these risks

includes anticipating potential global changes in prices, suppliers and product quality across

the value chain.

In the short term, disruptions to availability caused by extreme weather events are already

part of business operations. Identifying and assessing risks, and using climate scenario

analysis in medium- and long-term assessments, are key means of preparing for these risks.

Physical risk related to extreme weather events in the supply chain for products and raw

materials has been identified in all three of Kesko's divisions. The risk has not been

incorporated into the operational risk maps for any of the divisions, where the review period

is 12 months. Going forward, these risks will need to be assessed more thoroughly also in the

medium and long term. In the double materiality assessment, the risk was not considered to

exceed the materiality threshold at the time of the assessment.

Transition risks

With regard to climate-related transition risks, a key risk identified relates to responding to

evolving and increasingly stringent legislation. In the double materiality assessment, Kesko

has also identified a broader risk associated with tightening regulation across several

sustainability topics. This risk has been included under ESRS G1 Business conduct, as it

relates to ensuring compliance across different areas of sustainability regulation.

Kesko has not assessed business activities and assets that could be subject to possible

transition risks as part of its transition risk mapping.


		55

Business resilience

The resilience assessment is based on the assessment of climate-related risks in Kesko's own

operations. Kesko's business model, which consists of three different divisions, reduces

exposure to climate-related risks affecting an individual division. In the grocery trade and in

the building and technical trade, the diversification of supply chains and the diversity of

product categories support resilience and reduce related risks, and these risks are not

considered to have a significant impact on the financial position or business continuity of the

Kesko Group.

Climate-related risks related to properties are also not considered to be a significant risk to

the continuity of Kesko's business operations. The main risks to business continuity relate to

the supply reliability of Kesko's central warehouses and the functionality of critical

systems.The geographical diversification of Kesko’s retail locations also supports resilience

and reduces the risks associated with individual sites. Risks related to individual retail

locations are not significant for business continuity.

In general, the resilience of Kesko's business model to various climate-related risks is good.

However, the greatest impacts related to climate change arise in Kesko's value chain. In the

medium and long term, reducing GHG emissions in the value chain and adapting business

operations to the requirements of a low-carbon business model are essential.

Transition plan for climate change mitigation (E1-1)

During 2025, Kesko set new near- and long-term climate targets. The company has also

committed to reducing GHG emissions across its entire value chain to net-zero by 2050. The

new climate targets were approved by Kesko’s Board of Directors in October 2025, after

which they were submitted for validation to the Science Based Targets initiative (SBTi). The

validation process for these targets was still ongoing at the end of the reporting period on

31 December 2025. Kesko received confirmation that the SBTi validation process had

concluded and the targets had been approved after the reporting period ended, in January

2026.

Kesko’s climate targets are set in line with the SBTi criteria and are consistent with limiting

global warming to 1.5°C in line with the Paris Agreement. Kesko is not subject to the

exclusion criteria applied in EU Paris‑aligned Benchmarks.

In 2024, Kesko prepared a transition plan for reducing energy and industrial emissions from

its own operations (scope 1 and 2). The plan was reviewed by the Group Management Board

and formally approved by the Board of Directors. The transition plan covers the years

2025–2034. The plan was updated during 2025, as the near-term target level was raised as

part of broader climate target updates.

The transition plan sets out the measures to reduce emissions from Kesko’s own operations

in order to achieve its near-term climate target. Key measures for reducing emissions in

Kesko’s own operations include electrifying logistics and switching to biofuels, phasing out

oil and gas heating, improving energy efficiency and increasing the use of renewable energy.

In our assessment, the amount of locked-in emissions is limited and does not threaten the

achievement of near-term emission reduction targets. Potential locked-in emissions are

particularly associated with electricity-related emissions in Poland and the Baltics, district

heating use, and possible constraints on the electrification of logistics, which could maintain

the use of fossil fuels. The development of locked-in emissions largely depends on progress

in property technology, energy generation, and transport electrification.

At the end of 2025, Kesko’s scope 1 and 2 GHG emissions totalled 74,204 tCO2eq. The

reduction from the 2024 base year was 19%. The most significant actions taken in 2025 to

achieve emission reductions were increasing the number of electric and gas vehicles in the

logistics fleet, as well as switching purchased electricity to zero-emission sources,

particularly in parts of operations in Denmark, Sweden and Norway.

In preparing the transition plan for energy and industrial emissions from own operations

(scope 1 and 2), Kesko assessed the level of investments required to implement the plan.

Investment decisions and their execution are part of strategy work and annual planning. The

investments required to implement Kesko’s transition plan are not expected to constitute a

significant share of the Group’s total investments. Kesko did not have an internal carbon

pricing mechanism in place during the reporting period.


		56

In Kesko’s own operations, capital expenditure under the Taxonomy Regulation is mainly

related to owning, leasing and construction of properties for the needs of its own business.

Kesko’s principle is that new properties are constructed in accordance with the technical

screening criteria set out in the Taxonomy Regulation. Kesko does not have CapEx plans as

defined by the Taxonomy Regulation, by which properties owned by Kesko would become

Taxonomy-aligned.

At the end of the reporting period in 2025, Kesko had not prepared a transition plan

according to the ESRS E1 Climate Change standard for reducing energy and industrial

emissions in the value chain or land use-related FLAG (Forest, Land and Agriculture)

emissions. During 2026, Kesko will prepare a transition plan for reducing these emissions,

extending to 2034. The transition plan will be reviewed by the Group Management Board,

and formally approved by the Board of Directors.

Kesko has not participated in projects to remove or store GHG emissions, nor has it financed

such projects by purchasing carbon credits. The need for neutralisation to achieve long-term

climate targets has been identified, but options and quantities have not yet been

investigated.

Further information on Kesko’s climate change mitigation actions and their link to financial

planning and access to finance is provided in the Actions section (E1-3). Kesko’s new climate

targets set in 2025 are described in the Targets and progress towards targets section (E1-4).

Policies (E1-2)

Kesko’s sustainability policy guides Kesko’s climate work. In this policy, Kesko is committed

to the goals of international climate summits for the mitigation of global warming and to

reducing emissions from its own operations and across the value chain. The sustainability

policy has been approved by Kesko’s Board of Directors, and its implementation is overseen

by Executive Vice President, Legal and Sustainability of Kesko Group, who is a member of

the Group Management Board.

At the end of 2025, the Board of Directors approved an updated sustainability policy, which

will take effect on 1 January 2026. The revised sustainability policy considers a broader range

of principles related to reducing GHG emissions and improving energy efficiency compared

to the previous policy.

Deforestation is one of the most critical drivers behind the rise in global GHG emissions. As

part of setting land use-related emissions targets, company must commit, in line with SBTi

criteria, to no deforestation across its primary deforestation-linked commodities, by the end

of 2025. Kesko is committed to fulfilling this commitment.

Kesko’s energy strategy guides energy procurement and sets the principles for improving

energy efficiency. The energy strategy sets targets for improving energy efficiency and for

sourcing renewable electricity. The energy strategy has been approved by Kesko Group

Management Board, and its implementation is overseen by Kesko Group’s Energy Director.

Kesko’s K Code of Conduct for business partners sets out the expectations for its business

partners on sustainability-related matters, and is generally included in procurement

agreements. K Code of Conduct requires business partners to encourage sustainable

business practices throughout their supply chains. Kesko’s partners must also ensure that

subcontractors and providers of goods or services follow the same principles and standards

laid out in the K Code of Conduct for business partners.

Key internal stakeholders have participated in the formation of the sustainability policy and

the K Code of Conduct. The most current versions of the policies are publicly available on

Kesko’s website.


		57

Actions (E1-3)

Reducing GHG emissions in own operations

The most significant measures to support decarbonisation in Kesko’s own operations are the

electrification of logistics, switch to biofuels, phase-out of oil and gas heating, improving

energy efficiency, and increased use of renewable energy. These measures support Kesko’s

target to reduce absolute scope 1 and 2 GHG emissions by 58.8% by 2034 from the 2024

base year.

Electrification of logistics and transition to biofuels

The most significant emission source in Kesko’s own operations is the consumption of fossil

fuels in transportation and logistics operations. Emissions from fossil fuel use are expected

to decrease as logistics is increasingly electrified and the use of biofuels increases. We

estimate that around 30% of logistics transport will use alternatives to fossil fuels by 2030,

and approximately 40% by 2034.

At the end of 2025, Kesko had a total of 34 electric vehicles in operation, with an additional

six vehicles expected to be deployed at the beginning of 2026 due to delays in

commissioning. In addition, Kesko had a total of 23 gas-powered vehicles in operation at the

end of 2025. The emission reduction achieved through the increase in electric and gas-

powered vehicles during the year was approximately 2,400 tonnes. The emission reduction

expected to be achieved through fleet changes by the end of 2034 is approximately 25,000

tonnes.

Use of renewable energy

Kesko uses renewable and emission-free electricity in Finland, Sweden and Norway. During

2025, the Danish operations transitioned to using emission-free electricity in the operations

of Davidsen Koncernen A/S. In addition, in Norway and Sweden, all electricity consumption

has been entirely renewable and emission-free since the beginning of 2025.

For businesses acquired in Denmark in 2025, the switch to emission-free electricity will occur

from the start of 2026. After this, electricity-related emissions will come from electricity

purchased for properties in the Baltics and Poland. For purchased electricity in Poland, the

plan is to switch largely to renewable or emission-free electricity in 2026.

The measures implemented reduced Kesko’s electricity consumption-related emissions by

approximately 3,800 tonnes.

In 2025, 97% of the purchased electricity consumed by Kesko was produced using renewable

energy sources and 1% using emission-free nuclear power. The exact origin of the remaining

portion cannot be determined.

Transition plan to reduce scope 1 and 2 emissions between 2025–2034


		58

Improving energy efficiency

Improving energy efficiency in properties and retail sites owned or leased by Kesko is a key

measure for reducing emissions from its own operations. The most significant energy

efficiency action is the installation of energy recycling systems that utilise waste heat from

store refrigeration systems, which reduces district heating consumption in these properties

by an average of up to 50% compared to the consumption level before. In addition, energy

savings are achieved by optimising setpoints and making use of analytics services to analyse

energy consumption.

During 2025, we implemented energy efficiency measures totalling approximately 17.6 GWh.

The most notable actions included installing energy recycling systems that utilise waste heat

in nine properties, which is estimated to have reduced district heating consumption in these

properties by around 3.5 GWh. In total, we carried out about 730 energy efficiency

improvement measures recorded in our information system during 2025.

The emission reduction expected from energy efficiency measures implemented in 2025 is

approximately 900 tonnes, representing the measures’ calculated annual emission reduction.

Emissions related to district heating consumption are assumed to decrease by a total of 60%

by the end of 2034, of which around 25 percentage points are estimated to result from own

actions and approximately 35 percentage points due to the green transition in heat

production.

Transitioning away from oil and gas heating

During 2025, Kesko had a total of 81 properties using fossil fuels for heating. Most of these

properties are located in Poland and the Baltic countries. Kesko's target is to replace the

heating solutions with zero-emission alternatives or district heating by 2029. The Group

uses some 1,600 owned or leased retail, logistics and office properties.

In 2025, we replaced the heating system in five oil- or gas-heated properties with district

heating or a heat pump solution. In addition, due to changes in the site network, a total of 18

oil-heated properties were removed from Kesko's network, which also contributed to

reducing emissions. The emission reduction achieved in 2025 was approximately 1,400

tonnes. The planned emission reduction by the end of 2034 is 1,300 tonnes.

Refrigerant leakages

To reduce emissions caused by refrigerant leakages, we will renew our refrigeration systems

to use natural refrigerants by 2030, in accordance with the requirements of the F-gas

Regulation. After 2030, refrigerant leakages will no longer lead to significant GHG

emissions. The anticipated total emission reduction is approximately 4,000 tonnes by the

end of 2030.

Reducing emissions in the value chain

Over 99% of Kesko's GHG emissions are generated within the value chain (scope 3).

Reducing these emissions primarily requires collaboration with supply chain partners, as the

value chain emissions originate from the activities of Kesko’s suppliers and service providers.

Since the beginning of 2021, Kesko has encouraged suppliers to set science-based emission

reduction targets for their own operations, and cooperation with goods and service providers

will play an increasingly important role in achieving Kesko’s climate targets in the future.

In addition to collaboration with actors in the supply chain, key areas for development in

reducing emissions across Kesko’s value chain include ensuring and improving data accuracy

as well as developing emission calculations so that we can monitor emission trends more

precisely.

The new Construction Act, which entered into force at the beginning of 2025, requires that

from 1 January 2026, large new buildings must be designed and constructed to be low-

carbon. The project developer must present a climate report at the final inspection, which

includes calculations for the building’s carbon footprint and carbon handprint. This obligation

requires precise, project-specific emissions data, potentially down to the product level.

To meet these requirements, Kesko has developed the reporting of emissions data for its

building and technical trade selections. Providing product-specific emissions data supports

customers’ statutory obligations and improves the accuracy of value chain emissions

(scope 3, category 1) reported in Kesko’s sustainability statement for purchased products in

the building and technical trade.


		59

Investments and financing related to the action plans

Investments aimed at reducing GHG emissions are related to the electrification of logistics

fleet, improving energy efficiency in properties, and replacing oil and gas heating with

alternative heating solutions.

Energy efficiency investments are made as part of the maintenance of properties, which

means the investment relates both to the maintenance needs of the property and to the

reduction of emissions in the properties as the property's energy efficiency improves.

Expected investment needs for the electrification of logistics fleet are particularly related to

investments in charging infrastructure for heavy-duty vehicles.

The investments required for measures to reduce emissions from Kesko’s own operations are

not expected to constitute a significant share of the Group’s total investments. Investment

decisions and their implementation form part of the annual strategy work and annual

planning process.

Kesko has not identified any climate change-related capital expenditure or climate change-

driven impairments of assets that could have a material impact on Kesko’s financial position

at the reporting date.

Kesko has a €300 million unsecured senior green bond issued under the Green Finance

Framework, the proceeds of which have been used to finance capital expenditure meeting

the framework criteria. At the end of 2025, the interest margins of two bilateral loans,

totalling €200 million, incorporated sustainability‑linked targets relating to the reduction of

greenhouse gas emissions and food waste. For the four bilateral loans amounting to €600

million refinanced during 2025, the sustainability‑linked targets will be negotiated once the

new climate targets have been approved by the Science Based Targets initiative.

Taxonomy-aligned investments

Kesko does not have CapEx plans, as defined by the Taxonomy Regulation, based on which

Kesko’s owned properties or logistics vehicles would become Taxonomy-aligned. For existing

properties, this would mean that improvements to the properties would result in at least a

30% reduction in primary energy demand. For the logistics fleet, the vehicles would need to

be zero-emission vehicles.

Kesko’s principle is that new properties are constructed in accordance with the technical

screening criteria set out in the Taxonomy Regulation. In 2025, Kesko had 20 (9)

construction projects underway in Finland, in which properties are being built in accordance

with the technical screening criteria of the Taxonomy. All new construction projects ongoing

in 2025 do not meet the Taxonomy criteria, as the planning and construction decisions were

made before the technical screening criteria were published and adopted at Kesko.

Targets and progress towards targets (E1-4)

Update of climate targets

During 2025, Kesko set new, updated climate targets. The targets were approved by Kesko’s

Board of Directors in October 2025. Kesko received confirmation that the SBTi validation

process had concluded and the targets had been accepted after the reporting period ended,

in January 2026.

Kesko’s climate targets are set in line with the SBTi criteria and are consistent with limiting

global warming to 1.5°C in line with the Paris Agreement. The SBTi requires that near-term

targets for scope 1 and 2 are set at the 1.5°C level and scope 3 targets at least at the “well

below 2°C” level. The minimum level for long-term targets is 1.5°C. Kesko’s near-term

emission reduction targets for scope 1 and 2 comply with the 1.5°C level, and the scope 3

target has been set at the “well below 2°C” level. The updated targets include near-term

targets for energy and industrial emissions as well as FLAG emissions extending to 2034, and

long-term targets extending to 2050. Additionally, Kesko has set a net-zero target for 2050.

In the 2024 sustainability statement, Kesko reported that Kesko had set scope 1 and 2

climate targets extending to 2034. As part of the SBTi target validation process, the targets

were updated to align with SBTi target criteria. In 2024, we reported a target to reduce GHG

emissions from Kesko’s own operations by 50% by 2034 compared with the 2024 base year.

The new target is to reduce the corresponding scope 1 and 2 GHG emissions by 58.8% by

2034 compared with the 2024 base year.


		60

The 2025 update of targets follows the SBTi criteria, which require setting a target for land-

use related FLAG (Forest, Land, and Agriculture) emissions if at least 20% of the company’s

total emissions are from this source. FLAG emissions arise from forestry, land use, and

agriculture. In Kesko’s value chain, these emissions originate primarily from the primary

production of food products.

The table provides a summary of Kesko’s climate targets and commitments validated by the

SBTi in January 2026. In addition to these targets, Kesko also has targets related to engaging

suppliers of goods and services and an energy efficiency target, which are not included in the

set of targets validated by the SBTi.

Kesko’s climate targets and commitments validated by the SBTi


Time frame	Target
Near-term	Kesko Corporation commits to reduce absolute scope 1 and 2 GHG emissions 58.8% by 2034 from a 2024 base year.
	Kesko Corporation also commits to reduce absolute scope 3 GHG emissions from purchased goods and services and use of sold products 35.0% by 2034 from a 2024 base year.
	Kesko Corporation commits to reduce absolute scope 1 FLAG GHG emissions 42.4% by 2034 from a 2024 base year.
	Kesko Corporation also commits to reduce absolute scope 3 FLAG GHG emissions 42.4% by 2034 from a 2024 base year.
Long-term	Kesko Corporation commits to reduce absolute scope 1, 2 and 3 GHG emissions 90.0% by 2050 from a 2024 base year.
Long-term	Kesko Corporation commits to reduce absolute scope 1 and 3 FLAG GHG emissions 72.0% by 2050 from a 2024 base year.
Net-zero	Kesko Corporation commits to achieve net-zero greenhouse gas emissions across the value chain by 2050.

Kesko has prepared a transition plan for reducing scope 1 and 2 GHG emissions in

accordance with the set near-term climate target. The emission reduction actions taken are

described in the section Actions (E1-3). For other targets, Kesko had not prepared a

transition plan or defined decarbonisation measures by the end of the reporting period. The

transition plan is described in the section Transition plan for climate change mitigation (E1-1).

In 2025, Kesko recalculated the base year for its climate targets and presents the restated

2024 base year figures. A reconciliation between the previously published 2024 figures and

the restated 2024 base-year figures is provided in Greenhouse gas emissions (E1-6). In the

recalculation, the coverage of emissions data was improved by adding previously missing

information and correcting errors identified after the completion of the 2024 sustainability

statement. These corrections affected all emission categories. More detailed information on

the recalculation is provided in the sustainability statement section Basis for preparation,

Changes in preparation and presentation of sustainability information.

According to the Greenhouse Gas Protocol calculation standard, recalculating base year

emissions is necessary when significant structural changes occur that materially impact

emissions or the scope of the emissions inventory. Such situations include, for example,

corporate restructuring, changes in calculation methodology, or improved data accuracy that

significantly alter base year emissions. The purpose of the recalculation is to ensure

comparability and consistency in monitoring targets over the years.


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Progress towards targets


					Target
	Base year		2025	%	Year	Value	%
Near-term climate targets
Scope 1 and 2 GHG emissions, market-based, tCO2 eq ⁽¹	2024	91,135	74,204	-19	2034	37,548	-59
Scope 3 GHG emissions, purchased goods and services and use of sold products, tCO2 eq ⁽¹	2024	6,941,006	7,768,187	+12	2034	4,511,654	-35
Scope 1 FLAG emissions, tCO2eq ⁽¹	2024	2,696	2,542	-6	2034	1,553	-42
Scope 3 FLAG emissions, tCO2eq ⁽¹	2024	3,323,927	3,188,670	-4	2034	1,914,582	-42
Suppliers and service providers set science-based emission targets, %	2024	47	47	-	2026	67	-
Long-term climate targets
Scope 1, 2 and 3 GHG emissions, market-based, tCO2eq ⁽¹	2024	7,362,415	8,155,224	+11	2050	736,241	-90
Scope 1 and 3 FLAG emissions, tCO2 eq ⁽¹	2024	3,326,623	3,191,212	-4	2050	931,454	-72
Energy
Energy efficiency measures, GWh	2024	-	38.5	-	2030	95.0	-
¹⁾Science Based Targets initiative validated Kesko's climate targets in January 2026.

Near-term climate targets

Kesko’s near-term climate targets include targets to reduce energy and industrial emissions

as well as FLAG emissions by 2034. The scope of the targets is based on the coverage

validated by SBTi, using 2024 as the base year for emissions.

Of Kesko’s own operations (scope 1 and 2), around 60% of the energy and industrial

emissions reduction target relates to scope 1 emissions and about 40% to scope 2 emissions.

Kesko’s near-term target for energy and industrial emissions in the value chain (scope 3)

includes the emissions categories purchased goods and services (category 1) and the use of

sold products (category 11). These categories cover 95% of the scope 3 emissions in the base

year 2024.

In addition to climate targets extending to 2034, Kesko presents an interim target for 2030 in

accordance with ESRS.

By the end of 2025, Kesko had achieved a 19% reduction in energy and industrial emissions

(scope 1 and 2) in its own operations compared to the base year 2024. The actions taken by

Kesko in 2025 to reduce emissions are described in the section Actions (E1-3).

By the end of 2025, energy and industrial emissions in the value chain (scope 3) had

increased by 12%, while FLAG emissions had decreased by 4%. Kesko had not developed a

transition plan to reduce the specified emission categories by the end of 2025. Information

about the transition plan is provided in section (E1-1).

Kesko targets that 67% of its suppliers and service providers will have set science‑based

emission reduction targets by the end of 2026. The original base year, 2020, was updated to

2024 following revised calculations to align with Kesko’s other climate targets. In 2024, 47%

of suppliers had set science‑based targets, and the share remained 47% in 2025. This target

is not included in the climate targets validated by the SBTi in January 2026.

Information on suppliers’ emission reduction targets is collected from the SBTi target

dashboard and Kesko’s CDP Climate Change responses. The percentage is calculated by

comparing Kesko’s annual purchases from suppliers and service providers with the total

purchases included in emission accounting. These include purchases of goods and services,

covering IT, marketing, real estate services, and other operating expenses. The percentage is

based on purchases from the previous financial year.


		62

Long-term climate targets

Kesko’s long-term climate targets include targets to reduce energy and industrial emissions

as well as FLAG emissions by 2050.

The long-term target for energy and industrial emissions includes the most significant

emission categories for Kesko’s own operations and resulting emissions: Purchased goods

and services (category 1), Capital goods (category 2), Upstream transportation and

distribution (category 4), Use of sold products (category 11), End-of-life treatment of sold

products (category 12), and K-retailers (franchising, category 14). Approximately 99% of the

total base year 2024 emissions under the energy and industrial emissions target are value

chain emissions. The majority of the long-term energy and industrial emission reduction

target is focused on value chain (scope 3) emissions.

The target for value chain (scope 3) FLAG emissions includes only emissions from food

products, which cover 99% of scope 3 FLAG emissions in the base year 2024.

In addition, Kesko has set a net-zero target for the entire value chain, in accordance with

SBTi criteria, extending to 2050. The SBTi net-zero standard requires that emissions across

the value chain are reduced to zero or to a residual level consistent with the 1.5 °C target.

From the target year onwards, any residual emissions must be neutralised through

permanent carbon removals.

Energy efficiency target

Kesko’s energy strategy aims to improve energy efficiency by 10% between 2024 and 2030.

The realised energy efficiency measures and their energy saving impacts are monitored

based on measures recorded in Kesko’s information system, together with the electricity and

heat savings reported for each measure. To achieve the target, Kesko must implement

energy efficiency actions totalling 95 GWh.

By the end of 2025, Kesko had implemented energy efficiency measures totalling 38.5 GWh

from the 2024 base year. Energy efficiency measures implemented in 2025 amounted to

17.6 GWh (20.9 GWh).


		63

Metrics

Energy consumption and mix (E1-5)

Energy consumption


MWh	2025	2024
Energy consumption from non-renewable sources	265,889	310,960
Share of fossil sources in total energy consumption, %	36	40
Fuel consumption from coal and coal products	-	-
Fuel consumption from crude oil and petroleum products	176,606	192,424
Fuel consumption from natural gas	6,524	6,098
Fuel consumption from other fossil sources	1,653	1,853
Consumption of purchased or acquired electricity, heat, steam, and cooling from fossil sources	81,107	110,585
Energy consumption from nuclear sources	5,186	305,500
Share of consumption from nuclear sources in total energy consumption, %	1	39
Energy consumption from renewable sources	457,785	160,695
Share of renewable sources in total energy consumption, %	63	21
Fuel consumption for renewable sources	17,531	3,327
Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources	431,475	148,341
The consumption of self-generated non-fuel renewable energy	8,780	9,027
Total energy consumption	728,861	777,155

Energy intensity


MWh / Net sales, € million	2025	2024
Energy intensity from activities in high climate impact sectors based on net sales	58	65

Accounting policies

Energy consumption data are based on purchased energy, self‑generated heating and

electricity, and the calculated energy consumption of transportation, logistics and company

cars, by energy source and fuel type. The data cover properties owned and controlled by

Kesko, across all divisions and operating countries.

Purchased energy data for properties are based on metered consumption and maintained in

an operational information system. Energy managers monitor consumption and make

corrections when necessary, based on error alerts. For some sites, consumption is based on

invoices. For properties without metered data, consumption is estimated primarily based on

floor area, and secondarily on estimated area. 5% of purchased electricity and 6% of district

heating are calculated based on estimated consumption.

Oil and gas consumption includes properties where the heating system used oil or gas fully

or partially during the reporting period.

Estimated energy consumption for transport and logistics operations is primarily based on

fuel consumption.

Kesko’s business operations can mainly be classified as a high climate impact sector.

Among the products and services offered by Kesko, only the car leasing business is not

classified as having a high climate impact. The net sales generated from the leasing business

represent only a minor portion of the Group's total reported net sales. The energy

consumption of the leasing business cannot be separated from other energy consumption.

Energy intensity is calculated by dividing total energy consumption by the amount of net

sales reported in the consolidated financial statements.

The comparative year figures have been restated due to refinements in the calculation.

Further details on the restatement are provided in the sustainability statement section Basis

for preparation, Changes in preparation and presentation of sustainability information.


		64

Greenhouse gas emissions (E1-6)

Kesko’s GHG emissions consist of energy and industrial emissions as well as FLAG (Forest,

Land and Agriculture) emissions. These emissions are divided into scope 1 (direct emissions

from Kesko’s own operations), scope 2 (indirect GHG emissions from purchased energy),

and scope 3 (indirect GHG emissions from the value chain).

Kesko’s own operational emissions (scope 1 and 2)

Energy and industrial emissions from Kesko’s own operations in scope 1 include emissions

from fuels consumed by transport, logistics operations, and company cars, emissions from

fuels used for self-produced heating, and emissions arising from refrigerant leakages.

Scope 2 emissions cover Kesko’s purchased energy, i.e., emissions from purchased

11.3

million

tCO2eq

electricity, district heating, and district cooling.

Kesko’s energy and industrial emissions from its own operations (scope 1 and 2, market-

based) totalled 74,204 tCO2eq. The share of Kesko’s own operations in energy and industrial

emissions is less than 1%.

Kesko’s FLAG emissions from its own operations (scope 1) are generated from land use

changes on land owned by Kesko, for example, converting forest or other natural land to

developed land.

Value chain emissions (scope 3)

Energy and industrial emissions in the value chain (scope 3) mainly arise from the production

of products and services purchased by Kesko (category 1) and from the use of sold products

(category 11).

FLAG emissions in the value chain (scope 3) mainly originate in the primary production of

food products.

We have calculated Kesko’s own operational and value chain FLAG emissions for the first

time for 2024, and starting from 2025, FLAG emissions will be presented separately as part

of the total GHG emissions in the sustainability statement.

Breakdown of GHG emissions

Other value

chain emissions

Scope 3

categories

2, 4, 12 and 14

Kesko’s own

operations

Scope 1 and 2

Use of sold

products

16%

Scope 3

category 11

Scope 1 and 3

FLAG

emissions

3.2

million tCO2eq

8.2

million tCO2eq

Scope 1, 2 and 3

energy and

industrial

emissions

8.2

million tCO2eq

Purchased goods

and services

79%

Scope 3 category 1


		65

Bridge calculation for scope 1, 2 and 3 GHG emissions


	Reported	Restated
tCO2eq	2024	2024	%
Scope 1 GHG Emissions
Gross scope 1 GHG emissions	56,637	59,750	+5
Scope 2 GHG Emissions
Gross location-based scope 2 GHG emissions	42,950	43,167	+1
Gross market-based scope 2 GHG emissions	27,939	31,385	+12
Significant scope 3 GHG emissions
Total gross indirect scope 3 GHG emissions	7,122,142	7,271,280	+2
1 Purchased goods and services	6,108,778	5,844,593	-4
2 Capital goods	144,096	88,735	-38
3 Fuel and energy-related activities that are not included in scope 1 or scope 2 GHG emissions	8,372	-	-
4 Upstream transportation and distribution	90,076	87,055	-3
5 Waste generated in operations	9,488	-	-
6 Business travelling	1,774	-	-
7 Employee commuting	9,140	-	-
9 Downstream transportation	87,713	-	-
11 Use of sold products	505,950	1,096,413	+117
12 End-of-life treatment of sold products	126,873	124,791	-2
14 K-retailers (Franchising)	29,881	29,692	-1
Total GHG emissions
Total GHG emissions, location-based	7,221,729	7,374,196	+2
Total GHG emissions, market-based	7,206,718	7,362,415	+2

Kesko has recalculated the comparative data for 2024, which is also the base year for the

new climate targets. The bridge calculation for scope 1, 2 and 3 GHG emissions presents

both the information published in the 2024 sustainability statement and the newly

recalculated comparative data for 2024. More detailed information about the recalculation

can be found in the sustainability statement section Basis for preparation, Changes in

preparation and presentation of sustainability information.

According to ESRS, the company reports scope 3 GHG emissions for each significant

scope 3 category. As part of the recalculation of GHG emissions, Kesko has identified the

most significant scope 3 emission categories from its perspective. The combined share of

categories excluded from reporting is less than 1% of the total scope 3 energy and industrial

emissions, based on the 2024 emissions inventory assessment.

Categories that are excluded but were previously reported include category 3 Fuel and

energy-related activities that are not included in scope 1 or scope 2, category 5 Waste

generated in operations, category 6 Business travelling, category 7 Employee commuting,

and category 9 Downstream transportation.

Kesko has not previously reported scope 3 categories 8 Upstream leased assets,

10 Processing of sold products, 13 Downstream leased assets, or 15 Investments.

Scope 1 and 2 energy and industrial emissions by emission sources


tCO2eq	2025	2024
Direct scope 1 GHG emissions	55,237	59,750
Transportation, logistics and company cars	47,130	51,086
Self-produced heat	1,925	3,410
Refrigerant leakages	6,182	5,254
Indirect scope 2 GHG emissions
Location-based	34,721	43,167
Purchased electricity	13,270	13,230
District heat	21,451	29,937
District cooling	-	-
Market-based	18,967	31,385
Purchased electricity	3,977	8,126
District heat	14,990	23,260
District cooling	-	-


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Gross scopes 1, 2, 3 and total GHG emissions


	Retrospective				Interim target and target years
	Restated		Restated		Interim target	Target year	Target year
tCO2eq	Base year 2024	2025	2024	Change, %	2030	2034	2050	Average annual emission reduction, %
Scope 1 GHG Emissions
Gross scope 1 GHG emissions	59,750	55,237	59,750	-8	-	-	-	-
Percentage of scope 1 GHG emissions from regulated emission trading scheme, %	-	-	-	-	-	-	-	-
Scope 2 GHG Emissions
Gross location-based scope 2 GHG emissions	43,167	34,721	43,167	-20	-	-	-	-
Gross market-based scope 2 GHG emissions	31,385	18,967	31,385	-40	-	-	-	-
Total gross scope 1 and 2 emissions, market-based	91,135	74,204	91,135	-19	58,983	37,548	-	-5.88
Significant scope 3 GHG emissions
Total gross indirect scope 3 GHG emissions ⁽¹	7,271,280	8,081,021	7,271,280	+11	5,681,559	4,841,928	-	-3.50
1 Purchased goods and services	5,844,593	6,481,456	5,844,593	+11	-	-	-	-
2 Capital goods	88,735	144,227	88,735	+63	-	-	-	-
4 Upstream transportation and distribution	87,055	96,507	87,055	+11	-	-	-	-
11 Use of sold products	1,096,413	1,286,731	1,096,413	+17	-	-	-	-
12 End-of-life treatment of sold products	124,791	43,977	124,791	-65	-	-	-	-
14 K-retailers (Franchising)	29,692	28,122	29,692	-5
Total GHG emissions (scope 1, 2 and 3)
Total GHG emissions, location-based	7,374,196	8,170,978	7,374,196	+11	-	-	-	-
Total GHG emissions, market-based	7,362,415	8,155,224	7,362,415	+11	5,740,541	-	736,241	-3.46
Scope 1 FLAG emissions
FLAG scope 1 emissions	2,696	2,542	2,696	-6	2,010	1,553	-	-4.24
Scope 3 FLAG emissions
FLAG scope 3 emissions	3,323,927	3,188,670	3,323,927	-4	2,478,320	1,914,582	-	-4.24
Total gross FLAG emissions	3,326,623	3,191,212	3,326,623	-4	2,480,330	-	931,454	-2.77
Total GHG emissions (scope 1, 2, 3 and FLAG)
Total GHG emissions, location-based	10,700,819	11,362,190	10,700,819	+6	-	-	-	-
Total GHG emissions, market-based	10,689,037	11,346,436	10,689,037	+6	-	-	-	-
¹⁾Near-term target includes scope 3 category 1 Purchased goods and services and category 11 Use of sold products.


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GHG intensity


tCO2eq / Net sales, € million	2025	2024
Total gross scope 1, 2 and 3 emissions
GHG emission intensity per net sales, location-based	655	619
GHG emission intensity per net sales, market-based	654	618
Total gross scope 1, 2 and 3 and FLAG emissions
GHG emission intensity per net sales, location-based	911	898
GHG emission intensity per net sales, market-based	910	897

Biogenic emissions

Kesko has calculated its biogenic emissions for the first time for the year 2025. Biogenic

emissions have also been calculated retrospectively for the base year 2024. The majority of

Kesko’s biogenic emissions arise from the use of biofuels in its operations.

According to the Greenhouse Gas Protocol calculation standard, biogenic emissions are so-

called out-of-scope emissions, which are reported separately from other GHG emissions.

Biogenic emissions


tCO2eq	2025	2024
Scope 1 biogenic emissions	4,993	3,976
Scope 2 biogenic emissions, market-based	33,304	40,643
Scope 3 biogenic emissions ⁽¹	245,315	228,518
¹⁾ Includes biogenic emissions of categories 4, 11 ja 14.

Accounting policies

Kesko follows the Greenhouse Gas Protocol standards: Corporate Accounting and

Reporting Standard, Corporate Value Chain (scope 3) Accounting and Reporting Standard,

and Land Sector and Removals Guidance (draft version, September 2022).

The principle of financial control is applied to emissions reporting, whereby emissions are

reported for the companies in which Kesko has control (subsidiary) or joint control (joint

venture). Associates are not included in the emissions calculation.

Emission calculation data are collected from Kesko’s internal systems, external service

providers, and in some cases directly from partners. The data period primarily follows the

sustainability statement period, but due to data delays, some data represent the most

recent rolling 12‑month period or the available months of 2025 extrapolated to cover the

reporting period. For energy and industrial emissions (market‑based), less than 1% of data is

calculated using a non‑calendar period.

Scope 3 energy and industrial emissions, FLAG emissions, and biogenic emissions include

significant estimates and assumptions, and therefore involve high uncertainty. Results

should be interpreted as high‑level estimates of actual climate impacts.

Kesko reports its emissions in carbon dioxide equivalents (tCO2eq) in accordance with the

Greenhouse Gas Protocol accounting standard. CO2eq is a universal unit of measurement

used to describe the global warming potential (GWP) of the greenhouse gases listed in the

Kyoto Protocol, expressed as the GWP value of a single unit of CO2.

Energy and industrial emissions

Scope 1

Transportation emissions in Finland are calculated using vehicle‑type specific average fuel

consumption and mileage. For logistics operations in Finland, customer test drives and

replacement cars in car trade, and transportation and logistics operations of other

operating countries emissions are calculates based on fuel consumption. Company car

emissions are primarily based on fuel consumption. For benefit cars in Finland, calculation is

based on mileage and average consumption.


		68

The emissions from self-generated heat have been calculated based on fuel consumption or

the amount of energy produced with fuel.

Emissions from refrigerant leakages include leakages from refrigeration equipment,

property refrigeration systems, and temperature-controlled logistics equipment. The

emission calculation of refrigeration equipment leakages is based on the measured

quantities of refrigerant refilled. For property refrigeration systems, leakage amounts are

based on the measured refill quantities from individual properties, from which average

leakage amounts for all properties have been calculated based on floor area. The volume of

refrigerant leakages from temperature-controlled logistics equipment is determined based

on the number of units, an assumption regarding the most likely refrigerant, and average

leakage amounts based on research data.

The most significant data sources used for emission factors and other data in scope 1

emission calculations are, for fuels: Statistics Finland’s Fuel Classification 2025 and the

Department for Energy Security & Net Zero: Greenhouse gas reporting: conversion factors

2025, and for refrigerants: SFS-EN 378-1:2016 + A1:2020 standard.

Scope 2

Both location-based and market-based GHG emissions are calculated for purchased

energy.

Location-based emissions from purchased electricity are calculated using national average

emission factors. Market-based emissions are calculated based on the energy contracts

used by Kesko and the Guarantees of Origin acquired. The share of purchased electricity

covered by Guarantees of Origin is calculated as zero emissions. Other market-based

purchased electricity is calculated using the national residual mix emission factors.

The location-based emissions of district heating are calculated for Finland, Sweden, and

Denmark using national average factors. For other operating countries, the emission factors

are based on the production mix of district heating, using a calculated emission factor.

Market-based emissions for district heating are calculated only for Finland. For emissions

calculations, the emission calculator for district heating, maintained by Finnish Energy, is

utilised, providing location-specific emission factors for district heating consumption. The

calculation applies factors derived from the energy method.

Of the purchased electricity consumed by Kesko, 97% (i.e. 330,011 MWh) is covered by

Guarantees of Origin for renewable energy, and 1% (i.e. 4,521 MWh) by Guarantees of

Origin for nuclear energy. The share of consumption covered by Guarantees of Origin is

calculated as zero for market-based emissions, resulting in a 0% share of market-based

electricity consumption emissions.

The market-based emission share of district heating consumed by Kesko is 95% (i.e. 14,219

MWh).

No emissions are generated from the consumption of district cooling, as the production of

district cooling is based on renewable energy sources.

The most significant sources of data used for emission factors and other data in scope 2

emission calculations are the electricity and heat production statistics of Statistics Finland,

the district heating emission calculator of Finnish Energy, AIB’s European Residual Mix

2024, energy statistics from The International Energy Agency (IEA), Nowtricity, and

Ecoinvent 3.12.

Scope 3

Kesko's value chain energy and industrial emissions are reported for the most significant

emission categories, which are categories 1, 2, 4, 11, 12, and 14. Together, these categories

accounted for over 99% of Kesko's scope 3 energy and industrial emissions based on the

base year 2024 emissions inventory. Categories 3, 5, 6, 7, 9, 13, and 15 are excluded from

the calculation. The total emissions of these categories in the base year 2024 were less than

1%, and it can be assumed that they will be at a similar level in 2025 as well. Kesko has no

emissions in categories 8 and 10.

94% of Kesko's scope 3 emissions have been calculated based on activity data, and 4%

based on supplier-specific (primary) data.


		69

The most significant sources of data used for emission factors and other data in scope 2

emission calculations are the Natural Resources Institute Finland emission estimates for

food products, Ecoinvent 3.11, the Finnish Environment Institute’s CO2data service, the U.S.

Environmental Protection Agency, Statistics Finland’s Fuel Classification 2025, the

Department for Energy Security & Net Zero: Greenhouse gas reporting: conversion factors

2025, and the 2006 IPCC Guidelines for National Greenhouse Gas Inventories.

Category 1 – Purchased goods and services: The emission calculation for grocery trade is

based on the weights of sold products.

For the building and technical trade, the calculation is based on the weights of purchased

products, and for products where weight information is not available, on the purchase value

in euros.

In the car trade, the calculation is based on the number of sold cars. Emissions are

calculated only for new cars, as we assume that the manufacturing emissions of used cars

have already been accounted for by the car's first registrant. The emission factors are based

on segment-specific emission factors provided by the supplier, determined by the vehicle's

assembly and power source. In addition, the car trade’s calculation includes spare parts

based on sales euros, tires based on weight, and oils used in maintenance operations, as

well as purchased products in sports trade based on the number of items.

The emission calculation for services is based on the amount of expenditure recorded for

service procurement. Some of the emission factors used are based on coefficients reported

by service providers, and the calculated average of these is used for estimating emissions

for all similar services.

Emissions from the production of clean water consumed by Kesko are calculated based on

measured consumption. In Finland, 77% of the total area is included in the consumption

data, and in other operating countries, slightly more than half of the properties by number

are included. The calculation does not account for missing consumption, as its impact on

emissions is considered negligible. For all operating countries, the emission calculation is

based on the emission factor for clean water production provided by the Helsinki Region

Environmental Services Authority.

Category 2 –Capital goods: The calculation includes emissions from new buildings owned

by Kesko that were completed during the reporting period. The emissions consider the

building’s lifecycle stages A1–A5. The emissions are mainly based on climate assessments

carried out for the respective construction project. For two sites, the calculation uses

estimated average emissions from climate assessments between 2023 and 2025.

The emissions calculation for tangible assets is based on the amount of investment

recorded for the acquisitions.

The manufacturing emissions of K-Auto leasing vehicle investments are calculated based on

the number of new leased vehicles purchased during the reporting period. The emission

factors are based on segment-specific emission factors provided by the supplier,

determined by the vehicle's assembly and power source.

Category 4 – Upstream transportation and distribution: Logistics emissions in the grocery

trade and the building and technical trade are determined using the weight of transported

goods and an emission factor calculated specific to the corresponding flow of goods and

total weight for the year 2024. Some transports within building and technical trade are

calculated based on tonne-kilometres derived from the mode of transport and route

information. The calculation method is based on the ISO 14083:2023 standard and the

GLEC Framework V3.1.

The emissions from direct deliveries by the largest suppliers in the grocery trade and the car

trade, as well as postal service emissions in Finland, are mainly based on emission data

provided by suppliers. A small portion of direct deliveries in Finland and transportation

emissions in other operating countries, are calculated based on fuel consumption.

Emissions from external warehousing operations are primarily based on electricity and

heating consumption figures allocated to Kesko, or on consumption estimates based on

surface area. A small share of the resulting emissions has been obtained directly from

suppliers.

Emissions from refrigerant leakages in temperature-controlled transport and warehousing

operations have not been reported due to lack of data.


		70

Category 11 – Use of sold products: Product categories in the building and technical trade

that emit emissions during use have been identified. The use-phase emissions for these

product categories are calculated based on the share of use-phase emissions in the total life

cycle emissions, as found in environmental product declarations and research data.

The use-phase emissions of sold cars are calculated for new and leased cars based on the

assumed total life cycle mileage by power source. The use-phase emissions of leased cars

are included in Category 11 emissions, since vehicles are typically sold after the leasing

period, and thus the calculation is consistent with the use-phase emissions of other sold

cars. For used cars sold, the use-phase emissions are calculated according to the assumed

mileage remaining in their life cycle by power source. The calculation of emissions utilises

the public calculation tool provided by the Finnish Central Organization for Motor Trades

and Repairs. The use-phase emissions of sports products sold have not been calculated due

to lack of data.

The use-phase emissions of fuels sold by Kesko, such as charcoal, firewood, and lighter

gases, are calculated based on the weight of the products sold. Refuelling of sold cars is

calculated based on the amount of fuel.

Category 12 – End-of-life treatment of sold products: For the building and technical trade,

the calculation is based on the weights of purchased products, and for products where

weight information is not available, on the purchase value in euros and average, category-

specific end-of-life scenarios.

In the car trade, the calculation is based on the number of cars sold. The calculation of

emissions utilises the public calculation tool provided by the Finnish Central Organization

for Motor Trades and Repairs. For sports trade, emissions from the end-of-life treatment of

sold products have not been calculated due to lack of data.

For the grocery trade, emissions resulting from the end-of-life treatment of food waste are

determined by referencing the total national volume of food waste and Kesko's market

share. The calculation assumes that food waste ends up in anaerobic recycling.

For the grocery trade and the building and technical trade, emissions from the end-of-life

treatment of product packaging are calculated based on the weight of packaging materials.

The calculation assumes that the packaging is correctly sorted by material and that the

material is fully recycled. The calculation includes only Kesko's own brands, and there are

certain deficiencies in the data. The emissions share from the end-of-life treatment of

missing packaging cannot be reliably assessed.

Category 14 – K-retailers (Franchising): The emissions from the energy consumption of

properties rented and owned by independent K-retailers are calculated based on the floor

area or the estimated floor area. The specific consumption rates are assumed to be the

same as those used in Kesko’s own retail operations.

The emissions from the electricity supplied by Kesko to retailers are calculated for the

portion of electricity consumption that is not covered by guarantees of origin.

In properties managed by Kesko, where refrigeration equipment is the responsibility of the

retailers, the calculation of emissions from refrigerant leakages is based on the measured

amount of refrigerant refills. For refrigeration equipment in owned and rented properties of

retailers, the emissions are estimated based on the average, site-specific refrigerant

emissions.

FLAG emissions

Scope 1

The calculation is based on the land-use change area of the Onnela logistics center

construction project. The assessment utilized the Hiilikartta tool developed by the Natural

Resources Institute Finland and Avoin ry, designed for evaluating the climate impacts of

urban planning. According to the tool, the land-use change implemented in 2022 resulted in

a reduction of the area’s vegetation and soil carbon stock by a total of 30,808 tCO2eq. In

accordance with the Greenhouse Gas Protocol Land Sector and Removals Guidance (draft

version, September 2022), the emission from the land-use change is distributed using the

default 20-year assessment period from the year of occurrence. A linear discount approach

has been used for this distribution. The calculation for Kesko was performed by an external

calculation partner.

It is assumed that land-use changes, resulting in related emissions, have also occurred in

other construction projects by Kesko. Due to lack of data, these projects are not included in

the calculation, and the missing emissions cannot be reliably estimated.


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Scope 3

The calculation of FLAG emissions is based on the weight of products sold as well as the

origin countries of the products and their raw materials. For raw materials where the

country of origin is unknown, Kesko’s external calculation partner’s data system is used to

estimate the country of origin.

Reported emissions include only the emissions from food products of the grocery trade,

which, based on the 2024 base year calculation, cover approximately 99% of Kesko’s scope

3 FLAG emissions.

Biogenic emissions

Kesko’s scope 1 and 2 biogenic emissions arise from the use of biofuels in transportation,

logistics operations, company cars, as fuel for self-produced energy, and from the biofuel

share in purchased energy production.

The calculation of scope 3 biogenic emissions includes biogenic emissions from categories

4, 11, and 14. Biogenic emissions from categories 3, 6, 7, and 13 are excluded from

reporting, and categories 1, 2, 5, 9, 12, and 15 do not generate biogenic emissions.

The accounting policies for preparing biogenic emissions correspond to those used for

energy and industrial emissions.

GHG intensity

GHG intensity is calculated by dividing total GHG emissions by the net sales reported in

the consolidated financial statements. Intensity is calculated both for energy and industrial

emissions as well as for total GHG emissions, which include energy and industrial emissions

and FLAG emissions. For scope 3 energy and industrial emissions, the most significant

emission categories 1, 2, 4, 11, 12, and 14 are included.


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E5 RESOURCE USE

AND CIRCULAR

ECONOMY


Policies (E5-1) ...................................................	73
Actions (E5-2) ..................................................	73
Targets and progress towards targets (E5-3) ................................................................	59
Metrics ..............................................................	76
Resource outflows (E5-5) ................................	76

Material impacts, risks and opportunities (ESRS 2 SBM-3)

Material impacts, risks and opportunities


Topic	Description	Management
Resource outflows related to products and services: Packaging	Actual negative impact: The logistics chain of products includes several types of packaging, from logistics packaging to individual product retail packaging.	• Favouring renewable packaging materials. • In wood-based retail packages, favouring solutions of sustainable origins or recycled materials. • Increasing the use of packaging made from recycled plastic and cardboard. • Avoiding excessive use of packaging materials and controlled reduction of plastic use.
Waste	Actual negative impact: Waste is generated in Kesko’s operations, especially in warehouse operations, logistics and in own retail operations.	• Developing separate collection of waste. • Ensuring staff competence in waste sorting.
Food waste	Actual negative impact: Food waste is generated in Kesko’s warehouse operations, logistics and cash-and-carry outlets.	• Preventing waste through assortment management, forecasting and needs planning. • Utilising edible fruit and vegetable waste in waste-based products.
Food waste	Actual negative impact: Food waste is generated in K-food retailers’ store operations.	• Preventing waste through assortment management, forecasting and needs planning. • Discounted prices as the best before or use-by date approaches.


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Policies (E5-1)

In its sustainability policy, Kesko is committed to reducing food waste in its own operations

and in cooperation with stakeholders, such as independent K-food retailers operating

downstream in Kesko’s value chain. In addition, Kesko is committed to reducing the use of

packaging materials, especially plastics, and to promoting the recyclability of packaging

materials in its private label products. The principles of packaging for Kesko’s private label

products and logistics packaging are addressed in a separate packaging guideline.

Kesko’s sustainability policy does not include the waste hierarchy or prioritise avoiding or

minimising waste over recycling.

The sustainability policy covers the operations of Kesko Group. The policy has been

approved by Kesko’s Board of Directors, and its implementation is overseen by Executive

Vice President, Legal and Sustainability of Kesko Group, who is a member of the Group

Management Board.

At the end of 2025, Kesko’s Board of Directors approved an updated sustainability policy,

which will take effect on 1 January 2026. The revised sustainability policy takes into account

circular economy principles more broadly compared to the previous policy.

Kesko has a packaging guideline that covers retail packaging of Kesko’s private label

products and packaging used in own production or warehouses. In the packaging guideline,

Kesko is committed to favouring renewable packaging materials, and in wood-based retail

packaging, solutions with sustainable origins or recycled materials. In addition, the use of

packaging made from recycled plastic and cardboard is being increased, excess packaging

material is avoided, and the use of plastic is being reduced in a controlled manner.

The current packaging guideline was renewed in 2025 and it replaced previous separate

packaging and plastic guidelines. The revised guideline takes into account the entire lifecycle

of packaging, from the procurement of raw materials to disposal as waste.

The packaging guideline has been approved by the Group's sustainability management team.

Monitoring the principles of the guideline is the responsibility of the sustainable procurement

steering group in grocery trade, the commerce management team in building and technical

trade, and the sustainability steering group in car trade.

Key internal stakeholders have been involved in the creation of the sustainability policy and

the packaging guideline. The most current versions of the policies are publicly available on

Kesko’s website.

Actions (E5-2)

Kesko’s most important actions to promote circular economy principles are linked to

improving waste recycling rates and reducing the amount of food waste.

In 2025, Kesko and Koskisen Oyj piloted a solution in which wood packaging generated in

Kesko’s building and technical trade division was utilised as raw material for chipboard.

There has not previously been an industrial-scale recycling solution for wood waste in

Finland, and most of it has ended up being incinerated as mixed waste.

The piloting was carried out at Onninen’s central warehouse, where wood packaging such as

pallets and plastic pipe support frames that were being decommissioned were successfully

tested in chipboard production at Koskisen’s chipboard factory. Based on the results, the

operating model was adopted as a regular part of production during 2025. After regular

operations began at the end of 2025, a total of about 108 tonnes of wood packaging supplied

by Kesko were utilised as raw material for chipboard. Prior to this solution, the wood would

have ended up incinerated as mixed waste. The new operating model improves the recycling

rate of waste in the building and technical trade division in Finland.

Kesko has implemented a loss‑prevention model for non‑food products in all K‑Citymarket

stores. The primary aim is to prevent the creation of waste. Key actions include preventing

losses through efficient assortment planning, discount pricing and the use of outlet areas in

selected K-Citymarket stores. Unsold products are donated to charity, and disposal as waste

is used only as the final step. Based on the realised non‑food loss levels in 2025, more

detailed action plans will be developed, and store‑specific loss‑reduction targets will be set.


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Continuous actions to improve recycling rates include the development of separate

collection of waste. This increases the amount of waste that is diverted from disposal and

reduces the amount waste directed to disposal. The development of recycling rates is guided

by various recycling and collection equipment concepts, which define the waste fractions to

be collected and the collection equipment, as well as circular economy manager site visits to

optimise waste management. Effective sorting and improving recycling rates also depend on

staff sorting skills, which are continuously developed through training.

The most important ongoing actions for preventing food waste are the development of an

automatic ordering system and assortment management actions carried out in Kesko, K-food

stores and Kespro wholesalers, as well as price reductions as best before or use-by dates

approach.

In 2025, assortment management of waste-sensitive product groups, such as fruit,

vegetables and bread, was strengthened by system development, which allows more precise

and timely monitoring of product groups. In addition, at the beginning of the year, a centre of

excellence was established in the grocery trade division, in whose training activities for

stores, food waste is one of the significant focus areas, considering various perspectives such

as assortment, operating methods, pricing and displays.

Kesko renewed its packaging guideline in 2025. The new guideline replaced previous

separate packaging and plastic guidelines. The revised guideline considers the entire lifecycle

of packaging, from raw material procurement to disposal as waste.

Targets and progress towards targets (E5-3)

Kesko has set targets for improving the recycling rate of waste and reducing food waste in its

own operations and in the retail operations of K-food stores.


	Base year		2025	2024	Target
Waste recycling rate, %	2024	67	66	67	2030	73
Food waste in Kesko’s warehousing and logistics operations, %	2019	0.44	0.40	0.45	2030	0.22
Food waste in K-food retailers’ store operations, %	2019	2.12	1.58	1.68	2030	1.06

Recycling rate of waste

Kesko aims to improve the recycling rate of waste by six percentage points by the end of

2030 compared to the baseline in 2024. The target is linked to the waste hierarchy level

‘recycling’. External stakeholders have not been involved in setting the target.

The target has been set voluntarily and is not science-based. Kesko aims to improve

recycling in line with the EU Waste Framework Directive and Finland’s Waste Act, which

require businesses to promote waste prevention, material efficiency, and recycling. The

target for increasing the recycling rate covers the waste generated in Kesko’s retail

operations as well as warehouse and logistics operations.

The recycling rate fell from the 2024 level and was 66% in 2025. In Finland, the recycling rate

of waste fell slightly compared to 2024. Finland’s share of the total amount of waste is 58%.

In Norway, the recycling rate fell the most in relative terms.

Progress towards the target is monitored at the division level, and monitoring is the

responsibility of each divisions’s sustainability steering group. The steering groups are tasked

with monitoring the development of the recycling rate, setting and guiding actions to

improve the recycling rate, and reporting progress to the Group sustainability management

team.


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Food waste

The grocery trade division of Kesko is committed to halving the food waste percentage by

the end of 2030 compared to the baseline in 2019. The halving target covers Kesko’s

warehouse and logistics operations that serve K-food stores and Kespro’s foodservice

customers, as well as the retail operations of independent K-food retailers. The target is

linked to the waste hierarchy level ‘prevention of waste generation’. External stakeholders

have not been involved in setting the targets.

Kesko reports on the target of reducing food waste in the retail operations of K-food

retailers, as this is one of the targets of Kesko’s grocery trade division and one of the metrics

for Kesko’s sustainability-linked loans. This target differs from Kesko’s other sustainability

targets because its progress depends on the operations of independent K‑retailers at the

downstream end of the value chain.

The target has been set voluntarily and is not science-based. In Finland, waste legislation

requires food industry operators to monitor food waste and food losses as part of the

national system managed by the Natural Resources Institute Finland. Kesko reports food

waste to the Natural Resources Institute. EU and national targets aim for a significant

reduction in food waste by 2030, and Kesko’s target is aligned with these objectives.

The food waste percentage of Kesko’s warehouse and logistics operations was 0.40% at the

end of 2025 and has decreased since 2024. Kesko’s warehouse and logistics operations

cover those serving K-food stores and Kespro’s foodservice customers. In the retail

operations of K-food retailers, the food waste percentage was 1.58% at the end of 2025 and

has also decreased since 2024. Progress towards the target is estimated to be on track.

The combined food waste percentage from logistics operations serving K-food retailers and

K-food stores was 1.74% (1.84%) in 2025. The percentage is calculated by comparing the

total amount of food waste generated in logistics operations serving the stores and in the

K-food stores to the amount of food sold in kilograms by the stores.

The food waste management steering group monitors the targets for reducing food waste in

the grocery trade division. The task of the steering group is to ensure the achievement of the

annual targets of the food waste roadmap.

Accounting policies

The recycling rate for waste is calculated by comparing the amount of recycled waste to the

total amount of waste generated.

Food waste is recorded in warehouses and grocery stores using reason codes. Products

designated as waste are scanned, and these entries are saved in Kesko's information

system, which is also used in the K-food stores. The reported food waste is based on the

waste entries made by warehouses and stores. Waste quantities are collected from reports

generated by the information systems.

The food waste percentage includes both the donation of edible food to food aid and non-

edible bio-waste. The waste percentage is calculated by comparing the total amount of food

waste generated to the total kilogrammes of food sold.


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Metrics

Resource outflows (E5-5)

Recyclability of packaging

At the end of 2025, 97% (97%) of the packaging materials for Kesko’s private label products

were recyclable. The reported percentage of recyclable packaging in 2025 covers retail

packaging of private label products throughout the Group, excluding Danish operations. The

comparative figure for 2024 covers retail packaging for private label products in Finland. The

figure indicates the recyclability of the packaging material, but not whether the packaging is

correctly sorted by the end user. Materials classified as recyclable are those that can be

sorted by consumers. Packaging materials that are non-recyclable and sorted as mixed waste

include rubber, wood in consumer packaging, ceramics and porcelain.

Waste

Waste is generated particularly in Kesko’s own retail operations and in warehouse and

logistics operations. The largest waste fraction in Kesko’s own operations is cardboard,

which results from packaging during product transport and storage. The second largest

fraction is energy waste, from which heat and electricity are produced by incineration.

In the grocery trade division, biowaste constitutes a significant waste stream. It includes former

animal-based food products (category 3 by-products), such as meat and fish products that are

no longer suitable for human consumption, as well as by-products generated during the storage,

handling, and preparation of food. Waste streams in the building and technical trade division

include especially wood waste, mixed waste and various construction product wastes. In the car

trade division, in addition to cardboard, metal and steel waste and hazardous waste are

generated, for example from batteries, paints and oils replaced during maintenance and repairs.

In 2025, Kesko collected data for the first time on construction and demolition waste related

to construction projects, limited to projects where the Construction Act requires a report on

the waste generated. In 2025, data was only obtained from selected projects. Based on the

available information, it is not possible to comprehensively estimate the total amount of

construction and demolition waste, as waste reports were not collected from all projects.

According to the data collected, Kesko’s construction projects generated a total of about

41,700 tonnes of construction and demolition waste during 2025.

Amount of waste generated and its classification into non-hazardous and

hazardous waste


Tonnes	2025	2024
Total non-hazardous waste	24,757	27,177
Waste diverted from disposal	24,048	26,430
Preparation for reuse	102	-
Recycling	16,333	18,470
Other recovery operations	7,613	7,959
Waste directed to disposal	709	747
Incineration	-	210
Landfill	693	531
Other disposal operations	16	6
Total hazardous waste	1,319	782
Waste diverted from disposal	1,234	762
Preparation for reuse	46	2
Recycling	792	384
Other recovery operations	396	376
Waste directed to disposal	86	21
Incineration	13	9
Landfill	7	2
Other disposal operations	66	9
Total non-recycled waste	8,951	9,105
Percentage of non-recycled waste from total waste, %	34	33
Total waste	26,076	27,959

A total of 14 kg (141 kg) of radioactive waste was generated from the nuclear electricity

purchased by Kesko in 2025.


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Accounting policies

Packaging

Private label products are those whose trademark is owned by Kesko or products for which

Kesko is identified on the packaging as the contact information. The percentage of

recyclable packaging is calculated by comparing the total weight of recyclable product

packaging sold during the reporting period with the total weight of all product packaging

sold during the same period.

Packaging data is collected from product suppliers and maintained in Kesko’s internal

information systems. In recent years, significant focus has been directed toward ensuring

the accuracy and reliability of packaging data collection. However, deficiencies remain in

data maintenance, as packaging information is not consistently updated within the system

for all products. The comprehensiveness of packaging data has also been improved.

Waste

The amount of waste covers waste generated at Kesko’s own sites and in outsourced

warehousing services.

Information on waste amounts is obtained from the databases of waste management

partners and from invoices or lessors. Individual sites have been assessed based on

available information if the amount of waste attributable to Kesko’s operations is not

directly available. Such sites include, for example, premises located in shopping centres

where Kesko does not have its own waste management contract. In addition, waste

amounts in outsourced warehousing services and in some K-Citymarket department stores

are estimates of the amount of waste attributable to Kesko. The coverage of primary data in

determining the amount of waste is 80%.

Incineration with energy recovery has been assumed in all operating countries as another

form of utilisation in accordance with Annexes 1 and 2 of European Parliament Directive

2008/98. Incineration without energy recovery is classified as incineration. Hazardous

waste is classified according to Annex 3 of European Parliament Directive 2008/98. The

remaining waste is classified as ordinary waste.

The final treatment of waste is classified according to the waste treatment methods of each

operating country. There may be differences in treatment methods between countries.

The amount of radioactive waste is calculated for all electricity purchased by Kesko. For the

share of purchased electricity not covered by guarantees of origin, the amount of nuclear

waste is calculated based on the share of nuclear power in the country-specific electricity

production mix.


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SOCIAL INFORMATION

S1 OWN

WORKFORCE


Policies (S1-1) ...................................................	80
Processes for engaging with own workforce and their representatives (S1-2) .....................	82
Processes to remediate negative impacts and channels for own employees to raise concerns (S1-3) ................................................	82
Actions (S1-4) ..................................................	83
Targets and progress towards targets (S1-5)	85
Metrics ..............................................................	87

Material impacts, risks and opportunities (ESRS 2 SBM-3)

Material impacts, risks and opportunities


Topic	Description	Management
Working conditions: Adequate wage	Potential positive impact: Kesko is committed to providing all employee groups with an adequate wage, which is based on national pay levels and covers at least the basic needs of employees and their families.	Total remuneration consists of the base salary and other tangible and intangible elements. The base salary can be either a monthly salary or an hourly wage. We ensure that the pay is determined either by job evaluation or by the collective agreement applicable to the job.
Working conditions: Social dialogue and collective bargaining	Actual positive impact: Social partners engage in continuous dialogue to take employees’ expectations into account. This ensures fair working conditions for employees and terms of employment are in line with local legislation and labour market practices.	Kesko’s well-functioning cooperation practices enable employees to influence matters affecting them. Practices also promote a collaborative culture through ongoing dialogue.
Working conditions: Health and safety	Actual negative impact: Although measures and management models to promote health, work capacity and occupational safety are systematically implemented, work-related accidents may still occur and employees may become ill.	We anticipate and minimise health and occupational safety impacts through an occupational safety management model and best practices in occupational health and work capacity. Management measures vary in different units and age groups.
Equal treatment and opportunities for all: Gender equality	Potential positive impact: The experience of gender equality has a significant impact on employee experience and job satisfaction. Adhering to principles that promote gender equality fosters fairness and equality in the workplace.	We ensure gender equality and non-discrimination through our cooperation groups, various plans, common principles of remuneration and practices governing total remuneration.
Equal treatment and opportunities for all: Diversity	Potential positive impact:A diverse and inclusive work community creates the conditions for innovation and strengthens employee wellbeing.	The DEI programme focuses on the recruitment process, manager training, targeted training for employees, supporting women’s career development, as well as identifying and addressing the needs of special groups.
Equal treatment and opportunities for all: Prevention of violence and harassment	Potential positive impact: In our work community, everyone can perform their work without fear of violence, threats or harassment. Preventing violence is part of a day-to-day safety culture that supports wellbeing and productivity.	The management of impacts is ensured through best HR practices, actions promoting equality, the prevention of violence and harassment, zero tolerance for inappropriate behaviour, manager training, clear guidelines and investigation processes, and the SpeakUp channel.
Equal treatment and opportunities for all: Training and skills development	Actual positive impact: Continuous learning, career development and systematic performance management are key elements of competence development and a positive employee experience. Competent personnel are also ensured through business-driven recruitment.	A business-oriented approach underpins both recruitment and competence development. During performance and development discussions, we agree on measures for competence development. Kesko offers a range of in-person and online training for employees, which is communicated to the personnel.


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Material impacts, risks and opportunities and their

interaction with strategy and business model

Material impacts, risks and opportunities relating to own workforce have been assessed by

Kesko’s HR management, and material impacts and changes have been discussed by the

Group’s employee representative committee. Strategic considerations relating to personnel

are taken into account when drawing up business strategies. Kesko’s common HR strategy is

based on these business strategies. Personnel-related policies are an integral part of Kesko‘s

strategy.

Own workforce includes all Kesko employees who are in an employment relationship with

Kesko. The types of employment relationships are set out in more detail in the Metrics

section of Characteristics of the undertaking’s employees (S1-6). In some of Kesko’s business

areas, personnel are employed through employment agencies, but non-employees account

for only around 0.5% of the total workforce; therefore, reporting is not considered material

to Kesko’s operations.

Kesko has identified positive impacts on its own workforce in the following areas: collective

bargaining coverage and social dialogue, adequate wages, equal treatment and inclusion, and

training and skills development. The positive impacts of collective bargaining coverage and

social dialogue are particularly relevant for employees in Finland, Sweden, Norway and

Denmark, as the Baltic countries and Poland do not have collective agreements or social

partners comparable to those in the Nordic countries. The positive impacts of the other areas

apply to all Kesko employees. Kesko’s actions are described in more detail in the Measures

section (S1-4).

We have identified an actual negative impact in the area of health and occupational safety in

relation to work-related accidents. Work-related accidents are usually individual accidents,

and mainly minor. The highest number of work-related accidents take place among logistics

workers, car mechanics and store employees. In Finland, work-related accidents among

young adults occur at a higher rate than in other age groups. Nevertheless, there has been

improvement among those aged 20–25. The overall trend in sickness absence days has been

declining. Data on diagnosed causes of sickness absences is available for Finland only.

Musculoskeletal disorders account for the largest number of diagnosed sickness absences,

while mental health disorders remain a major cause, among employees in stores and,

particularly, young employees.

Based on our current risk assessment, Kesko has not identified any operations in its countries

of operation that would be considered particularly high‑risk, such as those involving

significant risks of forced labour or child labour within its own workforce. The S2 Workers in

the value chain section also covers the risk of forced labour and child labour. Kesko has not

identified any material impacts on its own workforce related to the green transition.

Management of impacts

Kesko’s HR management conducts an HR risk analysis quarterly. Risk assessments and the

necessary mitigation measures are an integral part of all operations and decision-making

related to Kesko’s own workforce. Kesko carries out separate, systematic monitoring of

occupational safety, occupational health and wellbeing using data, and plans further

measures in cooperation between the Group and the business areas. We compile

occupational safety and health risk mitigation measures by division and country, and monitor

their implementation through the Occupational Safety Steering Group and the Group’s

occupational safety committee, which includes employee representatives.

To manage and mitigate negative impacts, we work closely with insurance companies and

occupational health service providers, and in Finland also with Kesko’s own occupational

health service. The responsible persons in the Group’s and divisions’ HR, Legal Affairs and

Sustainability units and the responsible persons and managers in the business areas are the

key parties responsible for managing the identified material impacts. Extensive cooperation

is carried out with employees and their representatives across the different areas, as

described in more detail in the Engagement with own workforce section (S1-2).

Material impacts identified in relation to Kesko’s own workforce have been taken into

account in Kesko’s sustainability and HR strategies, as well as in the related targets when

they apply across all operating countries.


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Policies (S1-1)

Goal-driven actions related to employees are steered and supported by the Group’s people

policy and the K Code of Conduct, as well as the sustainability and HR strategies. The people

policy sets out guidelines and principles for the following areas: recruitment, competence,

leadership, compensation, equality and non-discrimination, and safety and wellbeing. During

2025, we updated Kesko’s people policy that covers all operating countries. The people

policy was approved by Kesko’s Board of Directors and will enter into force on 1 January

2026. The update does not contain any significant changes to the key principles. Social

dialogue and collective bargaining are conducted in accordance with national laws and

practices and are not formally addressed in the people policy. In addition to these guiding

principles, we have established principles for health and occupational safety, equal

treatment, and training and skills development. The health and occupational safety principles

were previously approved by Kesko’s occupational safety committee. The most senior role

that has responsibility for implementation of the policies concerning personnel is the

Executive Vice President, HR, who is a member of the Group Management Board.

During 2025, we updated our people principles guiding our employees, which are: Customer

always first, Sales and growth in mind, Positive get things done attitude, Stronger together

and Fair play. These principles were approved by the President and CEO in October and

came into effect during 2025. They are also part of Kesko‘s strategy and people policy.

In line with the K Code of Conduct, we do not accept the use of child labour, any form of

forced labour, or human trafficking or any other forms of modern slavery. The people policy,

the K Code of Conduct and the occupational health and safety principles cover the entire

own workforce and they are available on Kesko’s intranet and external website.

Section G1 Business Conduct lists Kesko‘s own guidelines and operating models relating to

corporate culture, business conduct and respect of human rights, as well as the international

principles and declarations to which Kesko is committed in all its operations. In addition to

these, Kesko complies with the ILO Declaration on Fundamental Principles and Rights at

Work and is committed to the UN Women‘s Empowerment Principles to promote gender

equality and professional development for women.

Our operations are based on non-discrimination and equal opportunities. We ensure safe

and healthy working conditions in accordance with local laws, international occupational

safety standards and best practices. Kesko’s engagement with employees is based on

openness, inclusion and continuous dialogue. The principles relating to remuneration and

adequate wages are set out more detail in the policies on equal treatment.

Kesko protects the personal data and privacy of employees both during and after the

employment relationship. Employee data is processed securely and responsibly. In addition

to internal control, external parties regularly conduct audits on operations.

Policies related to the health and occupational safety

Occupational health and safety management is based on legal requirements, the

identification of material risks and the implementation of good practices. Our occupational

safety management model defines responsibilities at different levels of the organisation.

Occupational safety risks are assessed and analysed within the Group in accordance with its

approved risk assessment system. In the building and technical trade division, occupational

safety is promoted both through internal audits and external ISO 45001 certification in the

building and technical trade in all operating countries. The principles of the certification are

also applied elsewhere at Kesko. At Group level, we monitor wellbeing and psychosocial load

regularly as part of the K Voices employee engagement survey.

Kesko’s occupational safety steering group is responsible for defining strategic targets,

specifying the division of responsibilities at different organisational levels, coordinating

measures and monitoring their effectiveness. Management models vary according to the

countries of operation and local legislation.

Employees can present observations related to occupational safety in the manner agreed at

the site and identify the resources that support wellbeing and to address factors and

situations that threaten health and work capacity. The managers have operational

responsibility for occupational safety in their units and the occupational safety managers

coordinate cooperation in their area of responsibility. Services that support employees’

occupational health, such as work capacity and mental health, are organised in accordance

with the practices and legislation of each country. We are committed to promoting the

continued employment of employees with partial work capacity through various measures.


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Policies related to equal treatment

In accordance with Kesko’s people policy and the K Code of Conduct, we are committed to

promoting non-discrimination, equality and fairness in all our operations. We are committed

to ensuring there is no discrimination based on gender, ethnicity, nationality, skin colour,

religion, political views, marital status, sexual orientation, gender identity, age, disability, or

any other personal characteristic at the workplace. Competence, education, and motivation

are emphasised in our recruitment process. We promote and coordinate equality through the

Group’s Employee Equality and Non-Discrimination Group, Kesko’s common operating

principles, and the K Code of Conduct. Discrimination is prevented through a zero-tolerance

policy and an operating model to address harassment and inappropriate behaviour. Potential

cases of discrimination are managed through investigation processes. Statutory equality and

non-discrimination plans form the foundation for development, while processes supporting

equality and equity are adapted to national practices.

Diversity and inclusion are promoted through a programme that supports DEI targets, with a

focus on building a diverse and inclusive workplace, equal remuneration and gender equality

at all levels of the organisation. Kesko is committed to the UN Women’s Empowerment

Principles to strengthen the position and career development of women. The priorities for

supporting vulnerable groups vary by country.

Kesko‘s core principles of remuneration are competitive, performance-based total

remuneration and the fair and equitable treatment of employees, which we are committed to

promoting under our equality and non-discrimination plan. Our remuneration practices

include regular reviews of base salaries, performance-based bonuses linked to Group and

business goals, and common employee benefits. The purpose of remuneration is to

encourage strong performance and to commit employees to the company and its strategic

targets. Kesko’s job evaluation system enables the comparison of salaries in comparable

jobs. We promote gender pay equality as part of our remuneration practices.

Kesko is committed to providing its employees with a salary that corresponds to the

demands of the position and ensures a decent standard of living. Remuneration is based

either on collective agreements or on a role‑specific job evaluation system. The total

remuneration package, which includes a base salary, performance bonuses and spot rewards,

is designed to support employee motivation, performance and financial security. Kesko

recognises the impact of part‑time work on livelihood and seeks to promote opportunities for

full‑time employment. Pay levels are assessed annually using external market data and

internal comparisons. An annual pay gap review is also carried out. In the 2025 pay review,

strong performance and competitiveness were taken into account, and pay increases were

negotiated with employee representatives. Kesko is preparing for the entry into force of the

EU Pay Transparency Directive. The Directive will introduce new obligations related to pay

reporting and employees’ right to information. If any unjustified pay differences between

genders are identified, Kesko will initiate a joint pay assessment with employee

representatives and take action to correct any unjustified differences.

Policies related to training and skills development

In accordance with Kesko’s people policy, competence development is based on strategy and

business objectives. Kesko draws up plans outlining priorities and measures for competence

development as part of the annual planning process, both at Group level and within the

business units. The training plan includes competence development actions in the following

areas: leadership and management, interaction and work life skills, and various areas of

professional expertise. Group HR and responsible persons in business areas work closely on

competence development and systematically monitor the implementation of the plans.

A sufficient level of competence ensures success and wellbeing at work and offers

opportunities for professional development and career advancement. Competence

development is promoted through training and on-the-job learning. Progress is discussed

and actions are agreed as part of the performance management process and in other

discussions with individuals.


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Processes for engaging with own workforce and

their representatives (S1-2)

Actual and potential impacts on own workforce are addressed through close cooperation

between employer and employee representatives in Kesko’s operating countries where such

representation exists. Kesko takes the views of its employees into account in its decision-

making, which helps the company to better understand the potential risks and impacts

related to its workforce.

Kesko has multiple employee forums where there is regular dialogue between employees and

the employer. The dialogue is conducted directly with employees, their representatives and

managers. Cooperation models vary by country, depending on the local legislation. These

employee forums monitor the impact on employees and their development: Kesko’s

cooperation group meets twice a year, employee representative committee meets monthly,

the HR management groups for each business area meet monthly or at least quarterly, and

the equality and non-discrimination group meets twice a year. The person with the most

senior role that has operational responsibility for ensuring engagement of and cooperation

with employee representatives is the Executive Vice President, HR, who is a member of the

Group Management Board.

In Finland, there is an agreement on the organisation of employee representation. At Kesko,

we have also drawn up a European Works Council (EWC) statement to deepen our

cooperation and dialogue. The next EWC meeting is planned for 2026. The effectiveness of

employee inclusion is measured by the amount of dialogue, the topics discussed, the

continuous feedback provide by employee representatives at the bi-annual Group

cooperation meeting. In addition, dialogue with employees is maintained through events

hosted by the President and CEO in connection with the publication of the interim reports.

In 2025, we conducted a K Voices employee engagement survey on the entire workforce,

with the exception of Denmark, to gather views and experiences on a broad scale. In

addition, the Let’s K survey was conducted twice during the year in Finland to gain insight

into current employee sentiment and jointly develop everyday work practices. Discussions

have also been held with language minority employees about their work experiences and

expectations in Finland. Kesko’s actions are described in the Measures section (S1-4). In

addition to the common employee engagement survey, various other surveys and

assessments are conducted in our operating countries, such as country-specific wellbeing,

job satisfaction, culture and operating environment surveys, which enable employees to

share their views.

Kesko respects employees’ freedom of association and collective bargaining in accordance

with local legislation. Regarding issues related to working conditions, wages and collective

agreements, we provide employees with channels to influence the decisions that affect them.

Kesko applies several collective agreements, including collective agreements for the retail

sector, the automotive trade and repair sector, and salaried employees. The agreements are

applied by unit and by division, and local agreements complement the national agreements.

Dialogue with the social partners takes place at various levels. In 2025, discussions focused,

among other things, on the impacts of the EU Pay Transparency Directive, updates to

collective agreements, the reliability of remuneration systems based on collective

agreements, working time arrangements, wellbeing at work and social protection.

At Group level during the year, sustainability reporting requirements were discussed twice.

In addition, updates to the people policy and risk management were discussed. The

continuity of employee representation was ensured by supporting the organisation of

elections for employee and labour protection representatives. Occupational safety in Finland

and other operating countries was strengthened by reviewing labour protection practices

under a new management model and by updating the risk mapping every six months.

Processes to remediate negative impacts and

channels for own employees to raise concerns

(S1-3)

We organise employee forums and regular dialogue sessions where employees can present

their views on potential challenges related to working conditions, occupational health and

safety, or discrimination. These discussions may lead to concrete changes in our practices,

helping us to manage potential negative impacts.


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Kesko is committed to ensuring a fair and safe working environment for all employees. We

involve employees and occupational safety representatives in the assessment of workplace

risks. Employee participation enables more effective identification of both current and

potential risks.

We handle employees’ concerns appropriately and efficiently based on the following

principles: we communicate clearly, investigate issues promptly and systematically, and

follow a fair process that provides protection to the employee when necessary. We actively

monitor the effectiveness of corrective actions and implement additional measures when

required. The following sections describe the various monitoring mechanisms we use.

Kesko collaborates closely with representatives of the personnel, such as employee

representatives and trade unions. At regular discussion events employees can raise their

concerns and discuss them directly with management. At these events, we discuss topical

issues and seek solutions together. Discussions have included the company’s remuneration

practices and local employee benefits. In addition, a wide range of topics related to the

development of working life, cooperation, representation and wellbeing have been discussed

with employee representatives.

Employees are informed about the available reporting channels and how to use them, for

example at intranets and screens at sites. Employees and consultants should report

suspected misconduct primarily to their manager or responsible person at K Group. When

for some reason the information cannot be delivered to the persons in charge, the reporter

can use the SpeakUp reporting channel, where all reports are handled confidentially. The

employees of the company maintaining the SpeakUp channel are bound by strict

confidentiality obligations. The reports to be investigated by Kesko are handled by Kesko´s

Governance, Compliance & Ethics Group function. Other experts or authorities may be

needed in investigations on a case-by-case basis. The SpeakUp channel is described in more

detail in section G1 Business Conduct, Whistleblower protection.

In addition to the SpeakUp channel, representatives of Kesko‘s employees, occupational

health and safety representatives or employee representatives, are available to the

employees locally. For example, in Finland, the Task Force approach can be used to

investigate more extensive or serious reports from employees. In addition, various surveys,

such as the operating countries‘ own wellbeing, employee satisfaction or culture surveys,

allow employees to express their views and wishes anonymously. Cases and internal

investigations other than those submitted through the SpeakUp channel are part of the

normal HR work and employment law and are not reported. The business HR and employee

representatives address the challenges and concerns of employees and monitor the

effectiveness of implemented measures.

Actions (S1-4)

Health and occupational safety

In 2025, we compiled a Group-wide occupational safety risk map based on country-level risk

mapping and developed country-specific improvement plans accordingly. Kesko

implemented several measures to strengthen its occupational safety culture and its

systematic and proactive practices. For example, in Sweden, a working environment

committee was established; in Norway, internal audits focused on key risks; in Poland, health

and safety audits were conducted in stores and terminal areas; and in Lithuania, training was

provided for new health and occupational safety representatives.

In 2024, the majority of Kesko’s occupational diseases occurred in the car trade. Therefore,

the 2025 focus in the car trade was on preventing occupational diseases. Areas of

improvement were identified especially in work related to vehicle tyres. Measures included

training for managers, systematic on-the-job instruction, occupational hygiene

measurements and corrective actions based on those results, such as optimising the use of

personal protective equipment.


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In Finland in 2025, we piloted a self-assessment tool of psychosocial load in development

discussions. A total of approximately 6,600 employees assessed their own psychosocial load.

According to self-assessment, under 6% of respondents reported experiencing frequent or

constant psychosocial load. We trained managers to use the new psychosocial load

operating model. We also developed a process for the early identification and support of

employees experiencing harmful levels of psychosocial load. In Finland, we supported mental

wellbeing through training and communication, focusing on the identified mental health

challenges among young age groups, in particular.

At Kesko, we prevent potential negative impacts on occupational health, safety and

wellbeing by fulfilling legal requirements, identifying, preventing and mitigating material risks

and implementing good occupational health and safety practices. The business areas are

mainly responsible for occupational safety, employees’ wellbeing at work, and related

measures. Key measures include occupational safety induction and job training, opportunity

to make safety observations and a comprehensive risk assessment process, as well as

guidance on how to investigate work-related accidents that result in absence from work.

Occupational safety experts and representatives play a key role in the planning and

developing of operations. We develop cooperation with employees and employee

representatives in accordance with national laws and practices. We ensure the management

of impacts through concrete action plans and the monitoring of their implementation, and

through effective processes and human resources planning. In 2025, occupational health and

safety issues were discussed at Group level in the occupational safety committee three

times.

The Group’s occupational safety unit reports on key occupational safety indicators and

measures to the division and Group management every six months. In addition, business area

managers and HR review occupational health and safety topics every six months, monitor the

development of indicators and decide on the necessary measures for occupational safety and

wellbeing at work. Kesko’s units prepare an annual action plan covering development topics,

and HR monitors its implementation. In 2025, the Divisional and Group Management also

took measures to improve safety management based on the bi-annual reporting.

Absences, accidents and occupational diseases are prevented at Kesko through systematic

operating models and close cooperation between the Group, the divisions and employee

representatives. Examples of this include the work capacity and occupational safety

management model and, in Finland, developing the competence of HR partners and

managers in work capacity management. At Kesko, we actively support employees in

individual situations where their work capacity is reduced, for example by modifying their

work. Work-related accidents are systematically recorded in the accident reporting systems,

which occupational safety managers used to monitor investigations.

Managers are responsible for the induction of occupational health and safety topics to new

employees, and employees are also provided with occupational safety training. The manager,

together with occupational health specialists and HR partners, also assesses the employee’s

work capacity and wellbeing, if necessary.

Equal treatment and inclusion

Awareness of diversity and equality is promoted through the ‘Diversity and inclusion’ online

training, which was updated in 2025 to be more comprehensive and to include more

language versions. Diversity and equity matters are part of the Leader@K training for new

managers at Kesko. In addition, all logistics managers in Finland attended a training on the

topic in 2025.

A diversity pledge has been added to job advertisements, and the application form

emphasizes that applicants do not need to state their age or gender, nor include personal

information unrelated to the role on their CV.

We aim to attract an increasing number of talents with international backgrounds to Kesko.

For this reason, a buddy programme was established at K-Kampus to support the orientation

of employees who use English as their working language. In Finland, the grocery trade’s

programme for people with an immigrant background combines on-the-job training with

training and, where possible, employment in a store after the on-the-job training period.

Kesko aims to increase the number of women in the top management as well as middle

management positions. The Group HR management team and the Group sustainability

management team regularly monitor the progress of the DEI programme targets. The

Group’s HR department is responsible for the progress of the DEI programme.


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Training and skills development

In 2025, competence development focused on leadership and management, as well as

supporting professional growth and development. We strengthened this support by

introducing a new common K Learning environment in Finland and the Baltic countries. The

K Learning environment will be extended to other operating countries in the coming years. In

Finland, we implemented the ‘Manager supporting growth and development’ training to

support employees‘ career progression.

We continued to strengthen skills in influencing, collaboration and self-management, and

supported the adoption of AI tools with new training. In the stores, the focus was on

strengthening sales and customer interaction as well as service and product competence.

Store employees in Finland have also started using the new K Learning environment, which

provides them with a broad selection of professional training courses, including chain-

specific training, eLearning courses and opportunities to complete vocational qualifications.

Targets and progress towards targets (S1-5)


	Base year		2025	Target
Total Recordable Injury Frequency (TRIF), own workforce	2024	25.9	25.0	2030	22.0
Wellbeing index	2024	83	85	2030	86
Diversity and inclusion index	2024	87	88	2030	89
Top management, underrepresented gender proportion, %	2024	27.7	27.8	2030	40.0
Middle management, underrepresented gender proportion, %	2024	32.8	28.2	2030	45.0
Opportunities for development and growth	2024	68	70	2030	75

The occupational health and safety management system covers 100% of the entire own

workforce.

Kesko has set targets for the following own workforce subtopics: health and safety, gender

equality, diversity, and training and skills development. The base year for all targets is 2024,

and the target level has been set for 2030.

The setting of the targets has been extensively discussed with various internal stakeholders.

Targets have been reviewed together with the employee representative committee, the

equality and non‑discrimination group, the occupational safety steering group and the Group

occupational safety committee. External stakeholders have also been involved in defining the

targets. In particular, targets have been discussed in cooperation with occupational health

partners and insurance companies. These parties have had the opportunity to contribute

their views on both the targets and the related measures.

The Group Management Board regularly monitors targets related to Kesko’s own employees.

HR and sustainability management, HR business partners, steering and working groups, as

well as employee representatives, monitor the achievement of the targets.

The total recordable incident frequency (TRIF) was 25.0 and decreased from 2024 towards

the target level of 22.0. The wellbeing index based on the employee engagement survey

improved from 2024 and reached 85 in 2025. Progress in health and safety is assessed to be

on track.

The diversity and inclusion index based on the employee engagement survey increased from

2024 and reached 88 in 2025. The already high result improved even further. The proportion

of the underrepresented gender, referring to women, in top management remained at the

same level as in 2024. However, the proportion of women in middle management declined

from the baseline.

The target related to employee competence development is presented for the first time for

2025. The target was set in 2024 as part of the HR strategy. The target level is 75 by 2030.

Progress improved from the 2024 baseline, reaching 70 in 2025.

Accounting policies

In defining the target levels, industry‑specific benchmarks or average levels have been

taken into account where available and relevant. In addition, the baseline and the realistic

likelihood of achieving the targets in a diverse and evolving operating environment have

been considered. Target definitions also take into account that retail sector benchmarks

often distinguish between retail, wholesale and logistics; at Kesko, these areas have been

combined for the purpose of setting and monitoring overall targets. Where the metric is

based on the employee engagement survey, the expertise of the survey partner has been


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utilised in evaluating the metric, assessing progress, and determining the statistical

significance of changes.

More detailed accounting principles for the total recordable incident frequency are

described in the section on Health and Safety Metrics (S1‑14).

The wellbeing index and the diversity and inclusion index are based on indices constructed

from questions included in the K Voices employee engagement survey. The wellbeing index

consists of 12 statements, and the diversity and inclusion index of five statements. Both

indices use a 0–100 scale, and the result represents the percentage of favourable responses

among all respondents. The metric describing employee competence development and

growth is based on the K Voices survey statement: ‘I believe I have opportunities for

personal development and growth in K Group if I want’, and the result is the percentage of

favourable responses.

Employees in Denmark were not included in the K Voices employee engagement survey in

2024–2025, and therefore they are not included in the targets based on the employee

engagement survey results. Denmark currently uses its own separate personnel survey.

In the context of senior and middle management, the underrepresented gender refers to

women at Kesko. The proportion of women is calculated as a percentage of the total

number of employees in the respective group. Gender-balanced representation is

monitored using the data from Kesko’s HR master data system.


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Metrics

Characteristics of employees (S1-6)

Employee head count by gender


	2025	2024
Male	11,440	10,853
Female	7,536	7,444
Other	15	12
Not reported	-	-
Total	18,991	18,309

The average number of Group personnel converted to full-time equivalent employees by

segment is presented in the Note 2.5 Operating expenses and geographical breakdown in

the Note 2.2 Segment information of the consolidated financial statements.

Employee head count in countries where there are at least 50 employees

representing at least 10% of the total number of employees


	2025	2024
Finland	12,598	12,555
Norway	1,918	2,091

Employee turnover


	2025	2024
Number of employees who have left undertaking	3,807	4,161
Employee turnover, %	16.4	18.5

Employee head count by contract type and gender


	2025					2024
	Female	Male	Other	Not reported	Total	Female	Male	Other	Not reported	Total
Employees	7,536	11,440	15	-	18,991	7,444	10,853	12	-	18,309
Permanent	6,634	9,738	9	-	16,381	6,528	9,183	10	-	15,721
Temporary	662	886	6	-	1,554	659	896	1	-	1,556
Non-guaranteed hours	240	816	-	-	1,056	257	774	1	-	1,032
Full-time	3,866	8,990	5	-	12,861	3,845	8,533	4	-	12,382
Part-time	3,670	2,450	10	-	6,130	3,599	2,320	8	-	5,927


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Employee head count by contract type and operating country


	2025
	Finland	Norway	Sweden	Denmark	Estonia	Latvia	Lithuania	Poland	China⁽¹	Total
Number of employees	12,598	1,918	1,283	1,862	185	95	94	941	15	18,991
Permanent	10,821	1,565	1,118	1,769	179	94	94	726	15	16,381
Temporary	846	353	40	93	6	1	-	215	-	1,554
Non-guaranteed hours	931	-	125	-	-	-	-	-	-	1,056
Full-time	7,707	1,450	1,007	1,382	183	89	93	935	15	12,861
Part-time	4,891	468	276	480	2	6	1	6	-	6,130


	2024
	Finland	Norway	Sweden	Denmark	Estonia	Latvia	Lithuania	Poland	China⁽¹	Total
Number of employees	12,555	2,091	1,458	893	181	93	88	935	15	18,309
Permanent	10,862	1,711	1,224	825	172	93	87	732	15	15,721
Temporary	794	380	101	68	9	-	1	203	-	1,556
Non-guaranteed hours	899	-	133	-	-	-	-	-	-	1,032
Full-time	7,746	1,554	1,084	699	179	88	87	930	15	12,382
Part-time	4,809	537	374	194	2	5	1	5	-	5,927

¹⁾Kesko’s building and technical trade has a purchasing office in Shanghai, serving all operating countries in purchasing.

Accounting policies

Key figures related to own workforce cover Kesko Group employees in all operating

countries. The own workforce figure used in the calculations is expressed as the number of

employees as at the last day of the year. This figure also includes people who are not

actively working, such as those on family leave.

The gender distribution of the workforce by number of employees is as follows: male,

female, other or not reported by the employee.

Employee turnover includes all employees who left the Group during the year divided by the

average number of employees during the year. The average number of employees for the

year is calculated as the average of the average number of employees over the reporting

months.


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Collective bargaining coverage and social dialogue (S1-8)

Coverage of collective bargaining and social dialogue


	Collective Bargaining Coverage		Social Dialogue
Coverage Rate	Employees – EEA	Employees – Non- EEA	Workplace representation (EEA only)
0-19%
20-39%
40-59%
60-79%	Finland
80-100%	Norway		Finland, Norway
for countries with >50 employees representing >10% total employees

Employees covered by collective bargaining agreements


	2025	2024
Total employees covered by collective bargaining agreements, %	75.8	75.6

Accounting policies

The number of employees who are covered by collective agreements and in an employment

relationships is set in proportion to the number of employees with an employment

relationship.

In Finland, Norway and Denmark, blue-collar and white-collar employees are covered by

collective agreements, excluding senior salaried employees in Finland for whom a separate

local agreement has been drawn up concerning representation, working time arrangements

and pay adjustments. In Sweden, all employees are covered by collective agreements,

excluding the country director, who is covered by a separate agreement. There are no

collective agreements in Estonia, Latvia, Lithuania and Poland.

Diversity metrics (S1-9)

Age distribution of employees


	Number		Percentage, %
	2025	2024	2025	2024
Under 30 years	5,169	4,763	27.2	26.0
30-50 years	8,739	8,547	46.0	46.7
over 50 years	5,083	4,999	26.8	27.3

Gender distribution of top management


	Number		Percentage, %
	2025	2024	2025	2024
Women	27	26	27.8	27.7
Men	70	68	72.2	72.3
Other or unknown	-	-	-	-

Accounting policies

The age distribution of employees is reported as a number and percentage of employees in

three age groups.

The gender distribution of the top management is reported as a number and percentage. At

Kesko, the top management level consists of directors with a director agreement.


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Adequate wages (S1-10)

Kesko is committed to paying all employees a competitive salary that meets or exceeds the

legal minimum requirements and is sufficient to cover basic living costs. Salaries are based

on the level defined in the applicable collective agreement. In countries where collective

agreements are not used, employees are entitled to at least the statutory minimum wage. A

related description can be found in the section Collective bargaining coverage and social

dialogue (S1‑8).

An employee’s base salary is compared with the applicable reference salary, which depends

on the national practices and is either the wage defined in the collective agreement or the

statutory minimum wage. In the Nordic countries, an employee’s base salary is compared

with the collective agreement wage. In Estonia, Latvia, Lithuania and Poland, an employee’s

base salary is compared with the national minimum wage.

Training and skills development metrics (S1-13)

Performance and development discussions and performance review discussions are a

systematic part of Kesko’s performance management model. In 2025, 75.2% (63.5%) of own

workforce participated in performance management discussions and reviews in accordance

with the common operating approach. The discussions were broadened by developing a

model based on the needs of logistics employees in Finland.

Performance management and competence development


	2025	2024
% of employees that participated in regular performance and development discussions	99.6	92.7
Male	99.6	88.1
Female	99.8	97.4
Other or unknown	100.0	100.0
The average number of training hours per employee	4.6	4.4
Male	5.1	5.5
Female	4.0	3.2
Other or unknown	1.3	1.6

Accounting policies

The percentages of performance management discussions displayed in the table represent

the performance management discussions (target setting and development discussions and

performance review discussions) conducted in accordance with Kesko’s common operating

approach. The ratio of performance management discussions is calculated on the basis of

the number of people with the opportunity to have performance and development

discussions in accordance with Kesko’s common operating approach (target setting and

development discussions and performance evaluation review). These discussions are

documented in the HR master data system. In situations such as long absences or when an

employment relationship starts near the end of the year, the development discussion is not

conducted during the same calendar year. For individuals working in certain jobs, such as in

grocery stores, team-, department- or store-level targets are set and discussions are held

regularly, but these discussions are not reported according to Kesko’s common model.

The number of training hours, for both internal and external training, is calculated by the

reported training hours. For online training, the duration of one training session is estimated

to be 15 minutes.


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Health and safety metrics (S1-14)

Work-related accidents, cases of work-related ill health and fatalities


	2025	2024
Number of recordable work-related accidents	674	714
Rate of recordable work-related accidents (TRIF)	25.0	25.9
The number of cases of work-related ill health	-	4
The number of fatalities as a result of work-related accidents and work-related ill health	-	-
The number of days lost to work-related accidents and fatalities	3,400	2,147

Occupational health and safety management system covers 100% of Kesko’s own workforce.

Accounting policies

Work-related accidents, occupational diseases, fatalities due to work-related accidents and

occupational diseases, number of days lost due to work-related accidents and fatalities are

reported for own workforce. The number of work-related accidents refers to the number of

work-related accidents that have been reported to the employer from all countries.

The work-related accident frequency is calculated by multiplying the number of work-

related accidents by one million hours worked and dividing by the number of hours actually

worked (TRIF). The figure includes all approved work-related accidents and work-related

pain cases.

Occupational diseases include confirmed cases of occupational diseases according to the

ILO List of Occupational Diseases.

The days lost due to work-related diseases and fatalities are calculated in calendar days,

including the whole absence period from the first full day of absence. The number includes

days lost due to work-related accidents. The number of fatalities due to work-related

accidents and occupational diseases are added together. The figures for work-related

accidents, occupational diseases and fatalities do not include data on non-employees, such

as recruitment agency employees.

Compensation metrics (pay gap and total compensation)

(S1-16)

At Kesko in 2025, the remuneration ratio between genders is 2.7% (2.2%). The comparability

of the average total remuneration figures between women and men was affected by the

acquisitions made in Denmark during 2025, as well as changes in personnel numbers due to

organisational restructurings in different operating countries and refinements made to job

classifications. Among employees in Finland, the average gender pay gap narrowed slightly.

The ratio between the annual total remuneration of the highest paid individual and the

median annual total remuneration (excluding the highest paid person) was 47 (33).

Accounting policies

The remuneration figures are based on employees in active employment on the last day of

the year. The average pay gap between the total remuneration of women and men is

calculated as the weighted average of the number of people working in the same operating

country and between women and men in comparable jobs. The difference in total

remuneration is defined by employee group in the table.

The ratio of the highest-paid individual’s annual total remuneration has been calculated by

comparing it to the median of annual total remuneration. The median is calculated

excluding individuals who started after the beginning of the reporting year, who have been

absent for more than three months during the reporting year, and the remuneration of the

highest paid individual.


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Incidents, complaints and severe human rights impacts

(S1-17)

Through the SpeakUp channel, we received a total of 36 (15) reports concerning the working

conditions, terms of employment and other work‑related rights of Kesko’s own employees.

Cases reported through other channels are part of the routine investigations carried out by

HR partners and employment law specialists, and they are not recorded on a case‑by‑case

basis. In 2025, based on an estimate, Kesko had approximately 15 (around 10–15)

discrimination and harassment reports concerning its own employees. This estimate includes

uncertainties; for example, it does not include reports that do not meet the criteria of the

inappropriate conduct operating model or reports which, after investigation, are found to be

other types of employment‑related disagreements.

In 2025, no severe human rights violations were identified at Kesko. Kesko has not been

fined or subjected to other sanctions for the cases discussed above, or for cases from

previous years.

Accounting policies

The number of reports received through the SpeakUp channel includes those reports that

concern Kesko’s own employees and potentially inappropriate behaviour occurring in the

workplace. This figure does not include discrimination or harassment reports, as they are

reported separately. The total number of discrimination and harassment reports concerning

Kesko’s own employees is presented as an estimate by HR partners and employment law

specialists in the operating countries. Discrimination and harassment reports submitted

through the SpeakUp channel have been added to the estimate.


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S2 WORKERS IN

THE VALUE CHAIN


Policies (S2-1) ...................................................	94
Processes for engaging with value chain workers about impacts (S2-2) ........................	82
Processes to remediate negative impacts and channels for value chain workers to raise concerns (S2-3) .......................................	95
Actions (S2-4) ..................................................	96

Material impacts, risks and opportunities (ESRS 2 SBM-3)

Material impacts, risks and opportunities


Topic	Description	Management
Working conditions	Potential negative impact: Inadequate working conditions weaken value chain workers’ wellbeing and quality of life.	• The K Code of Conduct for business partners and the amfori BSCI Code of Conduct as part of the contracts with suppliers and service providers include requirements on respecting working conditions and human rights. • We require social responsibility audits and corrective actions where necessary from our direct suppliers in risk countries.
Child labour and forced labour	Potential negative impact: Infringements of labour rights affecting value chain workers cause suffering for the affected workers and their families.
Working conditions Child labour and forced labour	Risk: A breach of the supplier agreement between the supplier and Kesko and conduct that violates the K Code of Conduct may affect Kesko’s reputation and lead to disruptions in business operations if the business relationship with the supplier has to be terminated.	• We engage in dialogue with our suppliers and act in accordance with our escalation process. • We require social responsibility audits and corrective actions where necessary from our direct suppliers in risk countries.

Material impacts, risks and

opportunities and their interaction

with strategy and business model

Kesko has identified potential negative impacts related to

workers in the value chain. The identified potential

negative impacts are mainly individual cases: However,

supply chains of certain products sold by Kesko involve

also more systemic problems. Potential impacts on value

chain workers concern employees who work upstream in

Kesko’s value chain, in companies with which Kesko has a

business relationship.

The procurement of goods is a core element of Kesko’s

business model, and Kesko has business relationships with

a large number of suppliers of goods and services. Through

these relationships, Kesko is also connected to a large

number of workers employed by these companies.

Workers in global value chains may be exposed to

potential negative impacts in the manufacturing of

products sold by Kesko and the production of raw

materials required for those products.

Kesko has identified potential negative impacts related to

the working conditions of value chain workers and the use

of child and forced labour in its supply chains. The risk of

inadequate working conditions is particularly linked to

workers at Kesko’s suppliers involved in the manufacturing

or primary production of goods in countries classified as

risk countries. The country risk classification used for

sourcing is based on the World Bank Worldwide

Governance Indicators. Among the risk countries, Kesko’s

largest sourcing volumes come from China, Thailand,

Türkiye, India and Greece.


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Kesko has identified the risk of child and forced labour related to its value chain workers in

certain product categories included in Kesko’s product selection. Especially forced labour

risks are identified also outside of risk countries. Examples of systemic level impacts include

forced labour risk associated with seasonal work in primary agricultural production and

textile industry. Kesko has also identified a financial risk related to workers in the value chain.

If serious violations of workers’ working conditions or human rights, or incidents of child or

forced labour, occur within Kesko’s value chain, Kesko may face various negative financial

impacts. Negative impacts may relate to reputational damage for Kesko or business

disruptions caused by the termination of a supplier relationship.

Kesko has not identified material impacts on workers downstream in its value chain.

Policies (S2-1)

Kesko’s principles on human rights issues and working conditions in supply chains are

defined in Kesko’s sustainability policy and the K Code of Conduct for business partners.

Kesko pays special attention to human rights issues and working conditions in supply chains

in countries where the risks of human rights violations are the highest. Our policy is to

collaborate only with risk country suppliers that are included in the scope of social

responsibility audits. Division Presidents are responsible for the execution of the policy and

supplier selections. The implementation of the principles of the sustainability policy is the

responsibility of the Executive Vice President, Legal and Sustainability of Kesko Group.

Kesko’s Board of Directors approved the updated sustainability policy effective 1 January

2026. No significant changes were made regarding principles guiding Kesko’s activities

toward value chain workers.

Kesko has published a statement of commitment on human rights and an impact assessment

in compliance with the UN Guiding Principles on Business and Human Rights. Kesko respects

all internationally recognised human rights and is committed to several international

declarations and conventions. In 2025, Kesko carried out an update of its human rights

assessment with a focus on value chain workers. The assessment identified the most

significant human rights impacts by division and product category. The assessment was

completed at the end of 2025, and work on the findings will continue during 2026.

Kesko requires its suppliers and service providers to commit to the requirements outlined in

the K Code of Conduct for business partners. Suppliers and service providers must respect

all internationally recognised human rights principles, including the UN Universal Declaration

of Human Rights and the UN Convention on the Rights of the Child, the OECD Guidelines

for Multinational Enterprises and the OECD Due Diligence Guidance for Responsible

Business Conduct, the ILO Declaration on Fundamental Principles and Rights at Work, and

the UN Guiding Principles on Business and Human Rights.

The K Code of Conduct for business partners commits business partners to comply with

requirements related to working conditions, such as responsible recruitment, proper working

conditions, decent working hours, fair remuneration, freedom of association and collective

bargaining, and occupational health and safety. Business partners must not use forced labour

in any form, including all types of involuntary work and human trafficking. Business partners

must abstain from directly or indirectly employing children below the legal minimum age for

employment.

Our business partners must ensure that their subcontractors, suppliers and service providers

follow principles and standards similar to those set out in the K Code of Conduct for business

partners.

In 2025, two reports concerning service providers were submitted through Kesko’s SpeakUp

channel. These reports related to violations of labour and working time legislation, as well as

the failure to fulfil certain financial reporting obligations.

Kesko is a member of amfori, an association promoting sustainable trade, and takes part in

amfori BSCI (Business Social Compliance Initiative). In addition to Kesko’s own K Code of

Conduct for business partners, contracts with suppliers and service providers contain

contractual clauses concerning the amfori BSCI Code of Conduct. Through the amfori BSCI

Code of Conduct, suppliers and service providers commit to ensuring respect for human

rights in their supply chains in accordance with internationally recognised principles. The

Code of Conduct includes requirements relating to working conditions and the prohibition of

child labour, forced labour and human trafficking.


		95

Kesko is a signatory of the International Accord for Health and Safety in the Textile and

Garment Industry, which promotes occupational health and safety at garment and textile

factories in Bangladesh. We require that factories in Bangladesh manufacturing private-label

clothing and home textiles are included in the International Accord process.

Kesko guides the procurement of products containing raw materials identified as critical from

a social responsibility perspective with sustainability guidelines. Through our guidelines for

sourcing of cocoa, coffee, tea, palm oil, soy, textiles and timber and paper, we aim to reduce

the human rights challenges associated with their production. These guidelines direct the

procurement of raw materials for Kesko’s private label products, mainly produced in

accordance with internationally recognised certification systems. The certification standards

include criteria for respecting workers’ working conditions and human rights.

Processes for engaging with value chain workers

about impacts (S2-2)

Kesko recognises that, especially in global value chains, cooperation between different

operators is needed to prevent material negative impacts. We engage about the impacts on

value chain workers primarily through multi-stakeholder initiatives, such as amfori. We also

engage in dialogue with Fairtrade, for example. Cooperation with Fairtrade focuses on the

global supply chains of agricultural products and reducing risks in primary production. In

addition, Kesko works with the Centre for Child Rights and Business, an organisation

promoting children’s rights. As a member of the organisation’s working group, Kesko

receives up-to-date information on child labour and its prevention at the regular working

group meetings.

Currently, there is no direct engagement with value chain workers that would allow their

perspectives to be taken into account in decisions or activities aimed at managing the

impacts on value chain workers.

Kesko engages indirectly with the workers of its suppliers in risk countries through social

responsibility audits conducted by third parties. Risk country suppliers refer to those

suppliers with whom Kesko has a supplier agreement and whose country of domicile is

classified as a risk country. In Kesko’s grocery trade, audit requirements are applied more

broadly on a risk-based basis, taking into account the product’s country of manufacture.

In the assessment of social responsibility of our risk country suppliers, we favour primarily

amfori BSCI audits, which are based on the amfori BSCI Code of Conduct. We accept other

social responsibility assessment systems if their criteria correspond to those of amfori BSCI

auditing and if the audit is conducted by an independent party. Audits provide us with

information on workers’ working conditions, including the safety of working conditions in

production, the wages and working hours of workers and their rights of freedom of

association and collective bargaining. Interviews with workers are a key part of amfori BSCI,

SMETA and Fairtrade audits, for example. Audits are conducted at suppliers’ factories in

principle at least every two years, and more frequently if needed. The effectiveness of

engagement is assessed through the audits carried out. The audit process includes follow‑up

audits, which monitor how the identified non-conformities have been corrected. A follow‑up

audit is typically required within 12 months of the original audit.

Processes to remediate negative impacts and

channels for value chain workers to raise concerns

(S2-3)

When issues related to Kesko’s value chain workers arise, the sustainability unit and

procurement personnel of the responsible division address the issues and define corrective

actions as needed in cooperation. Situations are discussed with the supplier, and the aim is to

get the supplier to commit to corrective actions.

For serious violations of human rights and working conditions, Kesko follows its escalation

process updated in 2025. In accordance with the process, serious violations are handled in

collaboration with Kesko Group’s Governance, Compliance and Ethics function. Compliance

and the division conduct an initial assessment and assemble a multidisciplinary team to

define required actions. Corrective actions are agreed with the supplier, or, if necessary, the

relationship is suspended or terminated, and authorities are informed. Decisions are

documented and reported to key management. Kesko does not immediately terminate

cooperation if the supplier commits to resolving the identified issues within an agreed

timeline. The effectiveness of corrective actions is assessed through follow-up audits, for

example.


		96

The amfori BSCI audit process includes a Zero Tolerance Protocol, which is followed when an

auditor observes a particularly critical issue during the audit. If use of child labour is detected

in Kesko’s value chain, a remediation model of the Centre for Child Rights and Business is

available.

In accordance with the K Code of Conduct for business partners, Kesko’s partners must

implement mechanisms to receive, address and respond to complaints or concerns that

relate to potential non-compliance with the K Code of Conduct for business partners. The

K Code of Conduct for business partners provides information about Kesko’s SpeakUp

reporting channel that is open to all and allows workers in the value chain to report any

concerns. The SpeakUp channel is described in more detail in section G1 Business Conduct,

Protection of whistleblowers.

The process for handling violations is fundamentally the same regardless of how the issues

have been brought to Kesko’s attention. If a case is identified through a SpeakUp report,

legislation on the protection of whistleblowers and Kesko’s internal investigation process are

also taken into account.

In addition to Kesko’s own SpeakUp channel, a channel maintained by amfori, the amfori

Speak For Change, is available for workers in Vietnam, Türkiye, Bangladesh and four regions

in India at those factories of Kesko’s suppliers that fall within the scope of amfori BSCI audits.

Actions (S2-4)

In accordance with Kesko's policy, all factories of its own risk country sourcing must undergo

a social responsibility audit. Purchases from countries classified as risk countries accounted

for 1.2% (0.9%) of Kesko’s purchases of goods in 2025.

In 2025, a total of 970 (705) factories of suppliers in risk countries had a valid social

responsibility audit, resulting in an audit coverage of 97.6% (90.7%) of all factories of risk

country suppliers. The most common audit systems were amfori BSCI and SMETA. Missing

audits include situations where an audit was not valid or the audit process was incomplete or

delayed at the time of purchasing, or necessary information regarding the audit was not

received. In some cases, it has been possible to continue purchasing on the basis of an

exemption or while the audit process has been ongoing.

Since 2025, Kesko has introduced social responsibility audits from private‑label fresh fruit

and vegetable suppliers beyond the general risk country classification, in countries where

workers on fruit and vegetable farms face an elevated risk of human rights violations. In

defining the level of risk, Kesko uses the country risk list published by GLOBALG.A.P.

Suppliers operating in countries identified as medium‑ or high‑risk in the list are

recommended to undergo audits.

The majority of the deficiencies in amfori BSCI audits were related to compliance with

working time regulations and to social management systems at factories.

In 2025, Kesko terminated orders from four factories in which issues related to working

conditions were identified and consensus could not be reached with the suppliers on the

necessary corrective actions in the factories.

For several years, there have been suspicions of human trafficking in the Finnish

berry‑picking sector, involving also some of Kesko’s suppliers. In 2025, Kesko engaged with

its suppliers to clarify responsible business practices, requested written explanations of their

berry‑sourcing processes, and required key supplier personnel to complete the K Code of

Conduct online training. A legal case reported as ongoing in Kesko’s 2024 sustainability

statement resulted in a district court ruling in autumn 2025. In this ruling, one of Kesko’s

suppliers and a key individual at the company were convicted of human rights violations. The

supplier’s engagement with Kesko and the corrective actions taken to address the violation

were deemed insufficient in light of the court’s findings and the severity of the breach of the

K Code of Conduct. Consequently, Kesko terminated the supplier agreement. Another court

case involving a supplier operating in the same sector remains ongoing, and Kesko has

initiated dialogue with the supplier.

In autumn 2025, Kesko also participated in auditing the harvesting and accommodation

conditions at one of its berry‑sector suppliers. The audit model has been developed jointly

with an external inspection and certification service provider.

Kesko is also aware of an additional ongoing legal case related to alleged human rights

violations concerning one of its domestic suppliers.


		97

In 2025, a suspected human rights violation emerged in Kesko’s value chain when one of its

suppliers dismissed workers following a strike in Panama. Kesko engaged in dialogue with the

supplier, requested clarification on the incident, and continues to monitor the situation.

To strengthen business partners' commitment to the K Code of Conduct, Kesko released a

K Code of Conduct online training for its suppliers in 2025. In addition, Kesko’s suppliers in

risk countries have the opportunity to participate in training sessions on working conditions

and human rights organised by Kesko’s partners. During 2025, a total of 205 (62) Kesko’s

suppliers participated in training provided by amfori on topics such as fair remuneration and

working hours, zero tolerance for violence and harassment, and social management systems.

Kesko organises responsible purchasing training for its purchasing organisations. In 2025,

Kesko organised extensive training on identifying labour exploitation in subcontracting

chains, in cooperation with the Deaconess Foundation, the Assistance System for Victims of

Human Trafficking, the National Bureau of Investigation, the Regional State Administrative

Agency for Southern Finland, and the European Institute for Crime Prevention and Control

(HEUNI).


		98

S4 CONSUMERS

AND END-USERS


Policies (S4-1) ...................................................	100
Processes for engaging with consumers and end-users (S4-2) ..............................................	102
Processes to remediate negative impacts and channels for consumers and end-users to raise concerns (S4-3) ..................................	102
Actions (S4-4) ..................................................	103
Targets and progress towards targets (S4-5) ................................................................	104

Material impacts, risks and opportunities (ESRS 2 SBM-3)

Material impacts, risks and opportunities


Topic	Description	Management
Health and safety: Enabling healthy choices	Potential positive impact: Kesko has the opportunity to influence the health of consumers and end-users by offering healthier products that contain less salt, sugar or saturated fat.	• Reducing the amount of salt, sugar and fat in private label food products by reformulating the nutritional content of products.
Health and safety: Product safety	Potential negative impact: Deficiencies in the safety of the products sold by Kesko can have significant negative impacts on the health and safety of consumers and end-users.	• Documented own-control plans for food safety management. • Safety and quality systems.
Health and safety: Product safety	Risk: The realisation of product safety risk may cause reputational damage and may result in liability for damages for Kesko.	• Documented own-control plans for food safety management. • Safety and quality systems. • Risk assessments and continuous improvement of processes.
Privacy: Data protection	Potential negative impact: Kesko processes large amounts of data related to consumers’ personal data in its operations. Deficiencies in Kesko’s data protection principles and personal data processing procedures can expose consumers to misuse of their personal data.	• The data protection compliance programme ensures that competence and awareness of data protection guidelines in relation to protection of personal data remain at a high level.
Privacy: Data protection	Risk: The realisation of data protection risk may cause reputational damage and may result in liability for damages for Kesko.	• Risk assessments are conducted at the planning stage of personal data processing. • Data protection risk management conducted as part of the annual risk assessment process.


		99

Material impacts, risks and opportunities and their

interaction with strategy and business model

Kesko operates primarily in the consumer market in Finland. In Kesko’s other operating

countries, where Kesko engages in building and technical trade, Kesko operates mainly in the

business-to-business market.

In the retailer business model, Kesko sells products to K-retailer entrepreneurs, who conduct

retail trade under Kesko’s retail chains and sell products onward to consumers. Kesko’s retail

chains include K‑food stores, K‑Rauta building and home improvement stores, and most

Intersport stores, in which K‑retailer entrepreneurs operate retail businesses. In foodservice

operations, Kespro sells products to business customers, who in turn sell or serve the

products to end-users.

Kesko’s own retail operations, where Kesko sells products directly to consumers in Finland,

include car trade, the non-food business of K‑Citymarket, Budget Sport, and part of

Intersport sales. Onninen’s business operations in all its operating countries consist of

business-to-business trade. In building and home improvement trade outside Finland, in

Sweden, Norway and Denmark, the business is primarily Kesko’s own retailing. The building

and home improvement chains operate mainly in business-to-business trade, but they are

also open to consumers.

The quality and safety of products are a central part of Kesko’s operations. Products must

meet the requirements set by legislation, regulatory authorities, and Kesko’s own quality

criteria. Clear product information and appropriate instructions for use support the safe and

proper use of products.

Kesko’s extensive product selection includes products that may have adverse impacts on the

health of consumers and end-users. The sale of such products is strictly regulated, and their

sale is conducted in compliance with the laws that govern their distribution. Products that

may be harmful to health contain packaging labels warning of their risks, and their sale is

subject to heightened diligence, including the application of sales restrictions and self-

monitoring procedures.

Kesko’s operations are founded on data and the processing of data within Kesko’s operating

environment. Consumers who belong to K Group’s (Kesko and chain stores) K‑Plussa loyalty

programme have been identified as a significant group of individuals whose data are

collected. The data are used to serve customers individually, enabling the provision of

personalised benefits, rewards, and relevant information on product selections and services.

Customer data are also utilised in business management and in the development of products

and services.

In Kesko’s business model, the group of consumers and end-users interacting with Kesko is

broad. Particularly in Finland, the number of consumers interacting with Kesko or otherwise

within the scope of Kesko’s operations is substantial. Potential negative impacts on

consumers and end-users have been identified identified in relation to product safety and

data protection. In both cases, any potential negative impacts are isolated cases in nature.

Potential negative impacts concern the group of consumers and end-users interacting with

Kesko. From a product safety perspective, Kesko has not identified specific groups among

consumers and end-users who would be particularly affected by such impacts. Members of

the K‑Plussa loyalty programme have been identified as the individuals whose personal data

Kesko processes the most.

There is a clear interdependency between the potential negative impacts and risks related to

product safety and data protection. If a serious negative impact related to product safety or

data protection were to materialise, it could result in financial effects for Kesko through the

realisation of related risks.

Potential positive impacts on consumers and end-users relate to Kesko’s private label food

products and the nutritional healthiness of these products. Kesko operates in the grocery

trade in Finland, and the positive impact therefore applies to Kesko’s grocery trade

customers in Finland.


		100

Policies (S4-1)

Kesko is committed in its K Code of Conduct guidelines to respecting internationally

recognised human rights in all its operations. Customers have been identified as one

stakeholder group whose human rights may be affected by Kesko’s activities. In relation to

the realisation of customers’ human rights, the K Code of Conduct guidelines emphasise the

equal treatment of customers and other stakeholders, ensuring the safety, accessibility and

ease of use of customer interactions, and ensuring that the products and services offered by

Kesko are safe to use. The K Code of Conduct also addresses the responsible use of data.

Responsible use of data is defined as ensuring transparency, a high level of data protection,

and the creation of sustainable value for the business and its stakeholders.

Kesko’s human rights commitments are listed in section G1 Business Conduct, Corporate

culture and business conduct policies (G1-1). Kesko did not identify any suspected or

confirmed human rights violations related to consumers or end-users in 2025.

Making healthy choices easier for consumers and

end-users

As an operator in the retail sector, Kesko has opportunities within the grocery trade to

facilitate healthier food choices for its customers. To support consumers in making healthier

choices, Kesko is committed to reformulating the nutritional content of its private label

products in the grocery trade by reducing the levels of salt, sugar and saturated fat in the

products. Nutritional reformulation is focused especially on everyday basic products, thereby

reducing customers’ intake of salt, sugar and saturated fat. In the grocery trade division,

responsibility for advancing the targets for reformulating the nutritional content of private

label products lies with the Senior Vice President, Commerce, chain operations.

Product safety

Providing high-quality products that meet customer expectations is one of the cornerstones

of Kesko’s operations. Each of Kesko’s three divisions has its own defined operating

principles and processes for ensuring product safety and quality. The divisions’ different

product categories and business models require division-specific principles related to

product safety. The President of each division is responsible for ensuring the implementation

of the principles for product safety and quality.

Grocery trade

In the grocery trade, quality assurance is based on self-control throughout the chain. Each

stage, such as purchasing, storage, transport, grocery stores and cash-and-carry outlets, has

its own documented self-control plan. The self-control plans describe the measures to

manage food safety at different stages of the food chain. In production, the self-control plans

are HACCP-based (Hazard Analysis and Critical Control Points) and are based on the

identification of food safety hazards. The self-control plan for purchasing covers all food

products in Kesko’s range. Kesko requires the manufacturing plants of suppliers of private

label products to have a valid certified product safety system approved by Kesko, or that

Kesko has conducted an audit of the manufacturing plant.

Kesko Logistics, which is responsible for transportation and warehousing for K-food stores

and Kespro, as well as Kesko’s subsidiaries Reinin Liha and Kalatukku E. Eriksson, have a

certified food safety management system (FSSC 22000). The food safety management

system focuses on the assessment of food safety hazards and on ensuring practices to

prevent these hazards. The system is based on the idea of continuous improvement. The

systems also require the ability to respond to various types of exceptional situations.

The product quality managers of the grocery trade’s Quality and Product Development Unit

monitor the product safety and quality of private label products and own imports. Product

quality managers take samples of products during the product development phase before

they are launched on the market. Samples of products on the market are taken according to

an annual sampling plan based on a product group-specific risk assessment and, if necessary,

based on customer feedback. Samples are tested in the Quality and Product Development

Unit’s own ISO 17025 accredited laboratory (T251) and product development kitchen and, if

necessary, in an accredited outsourced laboratory.


		101

Building and technical trade

The quality assurance of the building and technical trade’s private label and own import

products is conducted by the building and technical trade’s quality manager in cooperation

with the product managers, the purchasing department and the logistics centres. There are

product standards for most products that set the required level of quality assurance for the

product and any testing and approval requirements. The requirements for private label

products are specified separately in the purchasing contract.

Onninen’s units and the B2B sales unit in building and home improvement trade in Finland, as

well as Kesko AB in Sweden, have a certified quality management system (ISO 9001) in use.

The system requires the existence of quality assurance measures, the ability to respond to

various exceptional situations, and the continuous improvement of operations.

Car trade

In the car trade, Kesko is an importer of Volkswagen, Audi, SEAT, CUPRA, Porsche and

Bentley passenger cars and Volkswagen commercial vehicles. It is Kesko’s responsibility to

document any safety concerns raised by consumers and report them to the manufacturer.

Recall campaigns are the responsibility of the manufacturer, who will provide information on

the content of the campaign and the cars targeted by the campaign. Kesko is responsible for

implementing the campaign in its own market area.

There is an evaluation process for receiving used cars and inspecting the condition of the

cars, where the condition of the car is inspected and any faults requiring repair are identified

before the car is resold. As part of the evaluation process, a vehicle assessment card is

completed with the customer using a condition assessment tool, and the customer confirms

the information by signing it. In addition, comprehensive data on the car is collected for

resale purposes.

Data protection

Kesko’s data protection principles are described in the data protection policy and the K Code

of Conduct. The right to the protection of personal data is a fundamental right of every

individual. The data protection policy defines the principles, practices and responsibilities to

ensure the lawful processing of personal data and a high level of data protection at Kesko.

The data protection policy applies to the operations of Kesko Group companies in all

countries where Kesko operates. Data protection is closely linked to information security, the

principles of which are defined in Kesko’s information security policy. The data protection

policy, the information security policy and the K Code of Conduct have been approved by

Kesko’s Board of Directors. Kesko’s President and CEO has overall responsibility for the

implementation and management of data protection. Business and group management are

responsible for the implementation and oversight of data protection within their respective

units. The data protection policy is owned by K Legal and Sustainability, which is responsible

for updating the policy.

Each business unit or controller assesses and monitors the implementation of data protection

in its own operations. Data protection officers in their respective areas of responsibility are

responsible for developing, training and supervising data protection practices.

A risk-based approach is the basis for data protection. Data protection management is an

essential part of Kesko’s risk management. To ensure the effective implementation of data

protection, Kesko carries out data protection risk assessments at the planning stage of

personal data processing and as part of the annual risk assessment. Particular attention is

paid to situations where the processing of personal data is outsourced.

At the end of 2025, Kesko’s Board of Directors approved an updated data protection policy,

which will enter into force on 1 January 2026. The updated data protection policy does not

include significant changes to the key principles of data protection. The updated policy

clarifies the content of the policy, responsibilities and the organisation of data protection.


		102

Processes for engaging with consumers and

end-users (S4-2)

Kesko provides numerous channels for engaging with consumer customers and for giving

feedback. In Finland, Kesko’s key channels include the Hymy customer feedback system,

customer satisfaction surveys conducted twice a year for K‑food stores and K‑Rauta stores, a

continuous pulse‑type NPS survey (NPS: Net Promoter Score), and the K‑Kylä customer

community. Regular customer satisfaction surveys and the monitoring of the Net Promoter

Score (NPS) provide Kesko with up-to-date information on customer experience and

satisfaction, as well as on the effectiveness of actions directed at consumers or end-users.

Customer feedback and customer experience surveys are continuously utilised to develop

the customer experience in stores, the online store and other digital channels. In Finland, one

key engagement channel for customers is the K‑Kylä customer community, which is used

across all three divisions. K‑Kylä provides a channel for understanding customers’

experiences, expectations and needs. The aim of the K‑Kylä customer community is to

increase customer understanding and to develop business in a customer-oriented way.

Through the community, Kesko receives qualitative information that complements other

customer data and supports development work, for example in product selections, store and

service concepts and customer communications. Based on the results of studies, Kesko can,

for example, refine product selections, develop the characteristics of private label products

and improve the usability of services. In this way, K‑Kylä supports the development of

Kesko’s business and helps to direct actions in line with customer needs.

Through the K‑Kylä customer community, Kesko can communicate with members through

surveys or recruit members to participate in interviews or user testing. In 2025,

approximately 90 studies were conducted in K‑Kylä, generating around 87,000 individual

responses. During 2025, the K‑Kylä customer community grew, and at the end of the year it

had approximately 68,000 (44,000) members.

Kesko has processes and channels that enable engagement with customers in matters

related to data protection. In Finland, Kesko has a public data protection portal on its

website, which provides information and guidance related to data protection. An individual

may submit requests concerning their personal data through the data protection portal or by

contacting register-specific contact points or customer service channels. Questions and

requests raised are responded to without undue delay.

Data subjects may contact the data protection officer in all matters relating to the processing

of their personal data and to the exercise of their rights under data protection law. The data

protection officer facilitates the handling of such contacts and requests, and ensures that the

data subject receives a response without undue delay. The contact details of the data

protection officer are provided in each data protection notice.

Processes to remediate negative impacts and

channels for consumers and end-users to raise

concerns (S4-3)

Kesko has channels through which consumers or end-users can contact Kesko to raise

concerns and to support the remediation of potential negative impacts. All Kesko business

areas have websites through which customers can provide feedback, report an issue or

submit a product complaint. The packaging of Kesko’s private label products includes

Kesko’s customer service contact details. Customers may also contact Kesko’s customer

service by telephone or contact Kesko through various social media channels. In addition,

stores forward product feedback to Kesko.

Feedback received through different channels is recorded in customer service systems,

which also record the progress and resolution of the feedback. Feedback and product

complaints are monitored, and multiple instances of feedback on the same issue received

within a short period lead to further investigation and, where necessary, corrective measures.

In the grocery trade, Kesko introduced a new customer service system at the beginning of

2025, improving the monitoring of customer satisfaction in customer service. The average

customer satisfaction of the grocery trade’s Consumer Services was 94% in 2025. Senior

operational responsibility for the communication channels and their functioning lies with the

President of each division.


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In 2025, the grocery trade’s Consumer Services received a total of approximately 25,700

(25,600) instances of customer feedback related to private label products, of which

approximately 15,800 (18,500) were product complaints. In the building and technical trade,

the total number of customer feedback in K‑Rauta was approximately 37,600 (39,400), of

which approximately 10,900 (11,200) were product complaints.

In relation to suspected misconduct, consumers and end-users can also submit a report

through the SpeakUp channel. The SpeakUp channel is described in more detail in section

G1 Business Conduct of the sustainability statement. However, the SpeakUp channel is not

specifically targeted as a communication channel for consumers and end-users, although it is

open to consumers. Kesko does not separately assess consumers’ and end-users’ trust in the

SpeakUp channel.

Kesko has defined a process for handling information security incidents. If data protection is

suspected to have been compromised, the matter is investigated without undue delay. The

investigation involves, as appropriate, representatives of the relevant business unit, the

information security and risk management teams, and the data protection officer. Kesko

documents all information security incidents in accordance with legislative requirements and,

where a personal data breach is confirmed, notifies the data protection authority when the

notification threshold is met. Kesko also notifies the individual whose data protection has

been compromised without undue delay in situations required by the General Data

Protection Regulation (GDPR).

Actions (S4-4)

Product safety

In the grocery trade, the Quality and Product Development Unit decides on the recall of

private label products and is responsible for providing information on the matter internally at

Kesko, to K-food stores, Kespro’s B2B customers, consumers and the authorities. In the case

of products other than private label products, the supplier or importer of the product is

responsible for the product safety of its own products and decides on whether to recall

products. Kesko’s Quality and Product Development Unit is responsible for communicating

recalls based on information received from the supplier.

In 2025, a total of 149 (170) product recalls were carried out in the grocery trade. Of these,

34 (34) concerned private label or own import products. In other cases, Kesko assisted

product manufacturers in product recalls. In 2025, there was a total of 1 (3) public recall

involving private label products where a defect or error in the product may have health

impacts.

In the building and technical trade, quality managers, together with the product manager, are

responsible for the recall of private label products and the related measures. Information is

provided internally at Kesko, to K-Rauta stores, to Onninen, and to customers and

authorities.

In the building and technical trade in Finland, there were no public recalls of private label or

own import products in 2025 that would have required a product recall from the customer.

During 2024, one product withdrawal was carried out, where a product was withdrawn from

sales channels. There were no corresponding cases in 2025.

In 2025, a total of 19 (22) recall campaigns were initiated for the brands represented by

K-Auto. In addition, during 2025 Kesko became aware of a total of five fires involving

rechargeable vehicles. In situations where Kesko becomes aware of a fire involving a car

brand imported by Kesko, Kesko contacts the vehicle manufacturer, as it does in the case of

all safety deviations. Kesko and the vehicle manufacturer have their own processes for

responding to safety deviations.

Data protection

Kesko has a data protection compliance programme to ensure that competence and

awareness of guidelines remain at a high level in matters related to data protection. The

compliance programme aims to systematically promote a data protection culture by

providing regular training and internal communications on data protection topics. We strive

for a proactive approach and are committed to continuously improving data protection

practices. We regularly assess the data protection policy and other data protection

guidelines, procedures and technologies to identify areas for improvement and to ensure that

we can maintain a risk-appropriate level of security when processing personal data.


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Kesko’s data protection guidelines include the Group data protection manual and

supplementary country-specific instructions. The data protection guidelines apply to all

personnel and include the key rules, operating instructions and processes for implementing

data protection as well as for identifying and handling incidents and risks. The onboarding

programme and continuous training for each employee handling personal data include

achieving and maintaining the level of data protection expertise required for their role. Each

employee handling personal data must complete the data protection online training every

two years.

Regular data protection risk assessment provides the guidelines for the annual data

protection plan and data protection programme. In addition, Kesko carries out internal and

commissions external data protection audits on a needs- and risk-based basis.

In 2025, Kesko processed in Finland 936 (875) data protection requests submitted through

its data protection portal. In addition, requests were processed through other channels. In

Finland, Kesko Group detected and investigated a total of 273 (347) information security

breaches in its operations in 2025, of which 44 (63) were also reported to the Office of the

Data Protection Ombudsman. In other operating countries, a total of 8 (6) information

security breaches were detected, of which 4 (3) were reported to the local competent

supervisory authorities. In individual cases, the affected data subject was also notified of the

information security breach.

Neither Kesko nor its subsidiaries received any remarks regarding their operations from the

Data Protection Ombudsman during 2025. On the basis of complaints received, the Office of

the Data Protection Ombudsman issued three requests for additional information, and

responses were provided within the required timeframe.

Targets and progress towards targets (S4-5)

Kesko has set a target to reformulate the nutritional content of its private label products by

reducing the levels of salt, sugar and saturated fat. Kesko has not set measurable time‑bound

targets related to product safety and data protection, but it regularly monitors certain

metrics related to these topics.


	Base year	2025	2024	Target
The amount of salt in private label products, kg	2021	18,940	15,353	2025	50,000
The amount of sugar in private label products, kg	2021	233,643	97,171	2025	200,000
The amount of saturated fat in private label products, kg	2021	38,393	32,347	2025	50,000

During 2025, the nutritional content of a total of 36 (42) products was reformulated, which

resulted in a total reduction of 3,499 kg (7,535 kg) in salt, 135,636 kg (19,833 kg) in sugar and

5,968 kg (4,174 kg) in saturated fat. By the end of 2025, the nutritional content of a total of

125 (89) private label products had been reformulated.

Based on the nutritional reformulations completed by the end of 2025, Kesko achieved its

target for reducing the amount of sugar in private label products. The targets for reducing

the amounts of salt and saturated fat were not met by the 2025 target level. Kesko will

continue to monitor and further develop the nutritional content of its private label products,

with a particular focus on reducing the amounts of salt and saturated fat.

Accounting policies

The realisation of the target is monitored by comparing the changed nutrient contents with

the baseline, i.e. how much the amounts of salt, sugar and saturated fat have been reduced

in the nutritional contents of the products relative to the baseline volume.


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GOVERNANCE INFORMATION

G1 BUSINESS

CONDUCT


Corporate culture and business conduct policies (G1-1) .................................................	106
Management of relationships with suppliers (G1-2) ..............................................	108
Prevention of corruption and bribery (G1-3) ..............................................................	108
Confirmed incidents of corruption and bribery (G1-4) .................................................	109

Material impacts, risks and opportunities (ESRS 2 SBM-3)

Material impacts, risks and opportunities


Topic	Description	Management
Corporate culture	Potential positive impact: The K Code of Conduct supports the principles of ethical corporate culture. Kesko has two versions of the K Code of Conduct: a K Code of Conduct that covers the entire K Group and a separate K Code of Conduct for business partners. Both support the principles of an ethical corporate culture throughout the value chain.	Corporate culture is strengthened by training and communication, and effective investigation of potential cases. Tone from the top – corporate culture is strongly shaped by participation of management and leading by example.
Corporate culture	Risk: Increasing sustainability regulation may lead to changes in the business model and require investments to meet legislative requirements.	Changes in regulation are monitored actively and the impact of changes on business is assessed proactively.
Protection of whistleblowers	Potential positive impact: Kesko has a confidential SpeakUp channel that is open to personnel, customers, suppliers and other stakeholders. Kesko has anti- discrimination and anti-harassment principles, which, in line with the absolute prohibition of retaliation, ensure that the reporting of incidents or suspected incidents does not adversely affect the reporter or their employment relationship.	Kesko communicates on the SpeakUp channel to ensure people are aware of the channel and the principles of whistleblower protection, thus encouraging people to report concerns. Reports are investigated promptly and impartially, and it is ensured that the prohibition of retaliation is upheld in practice.
Corruption and bribery	Potential negative impact: Potential cases of corruption and bribery have a negative impact on society and undermine trust throughout the value chain. Kesko has a zero-tolerance approach to corruption and bribery. Prevention of corruption and bribery is an integral part of the K Code of Conduct and contributes to creating a more ethical value chain.	Communication and training is provided to ensure that personnel know what to do and how to identify cases of corruption and bribery and report them to the right parties.
Relationships with suppliers and service providers	Potential positive impact: Kesko‘s requirements for suppliers and service providers, such as commitment to the K Code of Conduct for business partners, promote an ethical and sustainable value chain.	The K Code of Conduct for business partners and other Kesko requirements are incorporated into suppliers’ and service providers' contracts. Trainings and information events are organised for suppliers and service providers.


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Corporate culture and business conduct

policies (G1-1)

Ethical business conduct and compliance in Kesko Group is ensured by complying with

legislation as well as with the K Compliance operating model and the K Code of Conduct

both of which approved by Kesko’s Board of Directors. In addition, Kesko is committed to

complying with the amfori BSCI Code of Conduct, the OECD Guidelines for Multinational

Enterprises and the OECD Due Diligence Guidance for Responsible Business Conduct.

Kesko‘s operations are also guided by the UN’s Guiding Principles on Business and Human

Rights, Global Compact initiative and Sustainable Development Goals (SDG’s), the

UN Universal Declaration of Human Rights and the Convention on the Rights of the Child, as

well as the International Chamber of Commerce’s business charter for sustainable

development and rules on combatting corruption. Ethical conduct and sustainability are

integral to Kesko’s business strategy and sustainability objectives. We monitor the

implementation of our business culture and ethical principles using indicators such as

training completion rates, the number of SpeakUp reports, and employee confidence in

reporting channels. In late 2025, Kesko launched new people principles that emphasise fair

play – openness and honesty – and sustainability, which guide all activities.

Putting the K Compliance operating model into practice is supported by the K Compliance

programmes approved by Kesko’s President and CEO. The K Compliance programmes are

available on Kesko’s intranet. In 2025, Kesko’s K Compliance programmes covered data

protection, competition law, trade sanctions and export controls, as well as the prevention of

corruption and bribery. A new Sustainability K Compliance Programme was approved in

2025. The programme systematically enhances Kesko’s due diligence process and the

management of goods and service suppliers, taking into account sustainability requirements

applicable to Kesko. Its purpose is to manage risks related, for example, to human rights, the

environment, corruption and ethical business conduct in the supply chain. The programme

establishes both the foundation for the supplier due diligence process and the basis for risk

assessment and risk management. The Governance, Compliance & Ethics function at Kesko

leads actions in accordance with the K Compliance operating model and reports on its

activities to Kesko’s President and CEO and the Audit Committee of the Board of Directors.

The K Code of Conduct that covers the entire personnel and Kesko’s business partners

serves as a basis for the K Compliance operating model. The K Code of Conduct is available

on Kesko’s website and sets out, among other things, guidance on responsible

decision‑making, respect for human rights, zero tolerance for corruption, equal and fair

treatment, responsible data handling, commitment to fair and free competition, minimising

impacts on climate and nature, supporting employee wellbeing and success, and responsible

trading. The President and CEO is responsible for the implementation of the K Code of

Conduct throughout the organisation, ensuring that it is integrated into all areas of

operation. Together, the K Compliance operating model and the K Code of Conduct support

the development of a strong culture of doing the right thing.

All members of Kesko’s personnel confirm their commitment to compliance with the K Code

of Conduct annually. The annual confirmation process also includes a discussion between

each employee and their manager on the application of the K Code of Conduct in practice. In

2025, 94% (85%) of Kesko employees submitted the annual confirmation. The confirmation

is collected from all Kesko employees, excluding those on longer sick, study, family or similar

leave at the time of collection, or employees working on an on‑call basis. For logistics

employees, those who signed an employment contract during the calendar year, in which

they commit to complying with the K Code of Conduct are not requested to provide a

separate annual confirmation.

The focus areas of ensuring compliant and ethical business conduct include the training of

personnel and performance of compliance audits in accordance with the annual plan. In

2024, 88% of all Kesko employees completed the K Code of Conduct training; in 2025, all

new employees were required to complete the training. No group‑wide K Code of Conduct

training round was arranged in 2025. Depending on their role, personnel are also required to

complete other compliance‑related online training, such as competition law and data

protection training.

The role of managers is emphasised in ensuring the compliance and ethics of Kesko’s

business operations in daily work. According to the K Code of Conduct, activities must be

transparent, and a culture of doing the right thing is emphasised. Suspected misconduct or

unethical behaviour should always be reported, primarily to one’s own manager or the

responsible unit. If this is not possible for some reason, any suspected misconduct can be

reported to K Group’s SpeakUp channel, which is a confidential reporting channel open to

everyone and which can be found through the Kesko.fi website. The channel also allows

anonymous reporting.


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Protection of whistleblowers

SpeakUp is a confidential reporting channel for the whole K Group. The whistleblowing

channel helps to maintain the trust of employees, customers and stakeholders in Kesko‘s and

K Group‘s business operations. Through the channel, K Group’s employees and suppliers,

customers and other stakeholders can report their observations concerning Kesko Group,

K Group or Kesko Pension Fund regarding suspected misconduct or criminal offences or

activities that breach the K Group‘s K Code of Conduct.

Kesko surveys its employees‘ confidence in the SpeakUp channel and its operations, as well

as in the reporting of grievances in general, with the K Voices employee engagement survey

conducted every other year. Awareness and trust in the SpeakUp channel or in raising

concerns among actors in the upstream or down stream the value chain, or among

consumers and end‑users, are not assessed separately. Maintaining the channel is an

essential part of Kesko’s K Compliance operating model and is the responsibility of the

Governance, Compliance & Ethics function. Kesko strictly complies with all applicable

legislation, including in the investigation of reports and the protection of whistleblowers.

Both national and European Union legislation on whistleblower protection imposes an

obligation on Kesko to protect persons who report violations of European Union law and

certain fields of national law to Kesko. As a general rule, personal data related to individuals

involved in SpeakUp investigations is processed only when it is absolutely necessary for the

investigation. In accordance with its anti-discrimination and anti-harassment principles

Kesko is committed to protecting its employees and other stakeholders who report

suspected discrimination, harassment, abuse or other prohibited conduct to Kesko, and to

preventing any retaliation in relation to such reports. Kesko prohibits any attempt to sanction

or in any way disadvantage or harass persons who express an intention to report or who have

already reported suspected misconduct. Kesko's principle of protecting whistleblowers

applies to anyone who reports a suspicion of wrongdoing in good faith, even if the concern

later proves to be unfounded. All employees who experience or witness retaliation or

otherwise observe behaviour that appears to be retaliatory should immediately report it to

either the manager, the occupational health and safety department, human resources or

Kesko's Governance, Compliance & Ethics function. They may also report their concerns

through Kesko's confidential SpeakUp channel. Kesko's anti-harassment and anti-

discrimination Principles also protect persons who participate in the investigation of reports,

act as witnesses or otherwise assist in the investigation, or make decisions or

recommendations in connection with investigations. A finding of retaliation or harassment

may lead to disciplinary action, such as termination of employment, liability for damages or

legal sanctions. Kesko's anti-discrimination principle also applies when the report does not

fall within the scope of national or European Union whistleblower protection legislation.

Kesko Group‘s Governance, Compliance & Ethics function is responsible for investigating

reports received through the channel. Other experts or authorities may be needed in the

investigation on a case-by-case basis. Those who regularly take part in investigating reports

receive training on how to perform the investigations. Information about the channel, its

functioning and reporters‘ rights can be found on the Group‘s internal intranet pages and on

Kesko.fi. The K Code of Conduct eLearning also includes a section on SpeakUp. An external

service provider is responsible for the technical implementation of the channel.

A total of 84 (53) reports concerning Kesko were submitted through the SpeakUp channel in

2025. No incidents of serious misconduct were identified. Reports were submitted on

unethical behaviour, conflict of interest and harassment, for example. No misuse of the

reporting channel was proved.

Targets related to corporate culture


	Base year		2025	Target
Employee commitment to K Code of Conduct, %	2024	85	94	2030	100

Kesko has set a target of strengthening employee commitment to, and awareness of, the

K Code of Conduct. Progress is monitored through the annual K Code of Conduct

confirmation. The target is to achieve a 100% annual confirmation rate by 2030. The 2025

confirmation rate indicates that we are well on track to meet the target, although no formal

interim milestones have been set.


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Management of relationships with suppliers (G1-2)

Kesko expects its business partners to act responsibly and commit to sustainable business

practices. Business partners must comply with all applicable laws, regulations and

international standards relevant to their operations, as well as Kesko‘s K Code of Conduct for

business partners or their own corresponding principles. The K Code of Conduct is an

integral part of our contracts with suppliers and service providers. The K Code of Conduct

for business partners requires business partners to respect human rights, to provide a safe

and healthy working environment and working conditions, to commit to minimising negative

and maximising positive impacts on climate and nature, and to carry out ethical business

conduct. Ethical business practices cover the prevention of corruption and bribery,

guidelines on hospitality and gifts, the requirement to engage in fair, honest and transparent

competition, the respect of intellectual property rights and confidential information,

compliance with trade sanctions and export controls, and the management of personal data

legally and responsibly.

Kesko’s supplier agreements in the building and technical trade include a sustainability

attachment that sets out Kesko’s key objectives and measures to promote sustainability in

the value chain, as well as the related guidelines and requirements for suppliers. The

sustainability attachment covers topics related to climate, biodiversity, environmental

protection, social responsibility and conflict minerals, as well as chemical guidelines. The

attachment was introduced in 2024 and is being incorporated into an increasing number of

supplier agreements as they are updated.

By applying the principles of the K Code of Conduct for business partners, we help ensure

that observed by our B2B customer are upheld throughout our value chain. In turn, our

business partners must promote responsible business practices throughout their supply and

value chains. Our business partners must ensure that their subcontractors and suppliers and

service providers comply with principles and standards that are similar to those set out in the

K Code of Conduct for business partners. We expect our business partners to implement

appropriate due diligence processes to monitor and manage their subcontracting

relationships.

When selecting its suppliers and service providers, Kesko takes into account criteria related

to social responsibility and the environment, for example by requiring suppliers and service

providers to commit to the K Code of Conduct or their own principles of a similar level and

the aforementioned sustainability attachment. Social responsibility across the value chain is

central to Kesko‘s relationships with suppliers and services providers, and our principle is to

cooperate only with suppliers from high-risk countries that are subject to social responsibility

audits. Social responsibility is described in more detail in S2 Workers in the value chain.

In 2025, Kesko’s President and CEO approved the Sustainability K Compliance Programme.

The programme aims to systematically enhance Kesko’s due diligence processes and the

management of suppliers and services providers, taking into account the sustainability

requirements and commitments applicable to Kesko.

Kesko annually organises sustainability trainings and information events for its business

partners, both independently and in cooperation with its partners. Business partners are also

actively encouraged to provide training, workshops or resources to their subcontractors and

their suppliers and service providers, and to ensure that they understand and maintain these

principles. In 2025, Kesko launched an online K Code of Conduct training intended for its

partners, particularly for suppliers. The training is available on Kesko’s website at kesko.fi in

all the languages of the countries where Kesko operates, as well as in Chinese. The training is

designed especially for small and medium-sized suppliers.

Prevention of corruption and bribery (G1-3)

The prevention of corruption and bribery is one of the focus areas of Kesko’s compliance

operations. Kesko manages this work through the K Compliance programme, which also

includes regular risk assessments conducted throughout Kesko. The programme has

identified as specific risk areas in Kesko‘s operations property and store site operations,

procurement of goods and services, participation in public procurement, operations in new

geographical and business areas, relations with government officials, and mergers and

acquisitions. Those working with risk functions must complete the general K Code of

Conduct eLearning — including the section on corruption and bribery — when starting as

new employees and in line with the Group‑wide training cycle. In 2025, in addition to the

eLearning, workshop‑style anti‑corruption and anti‑bribery trainings were arranged for

employees in defined risk functions, with 81% participation in Finland, Sweden and Estonia.


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Training will commence in Norway, Denmark, Poland, Latvia and Lithuania in 2026. Kesko’s

K Code of Conduct includes anti-corruption and anti-bribery guidance, which were

complemented by more detailed anti-corruption and anti-bribery principles that entered into

force in 2024.

Every new employee must also complete the K Code of Conduct eLearning, which includes a

comprehensive section on combatting corruption and bribery. In addition to the eLearning,

new employees receive training on the K Code of Conduct at Welcome to K Group events,

for example, where rules on gifts and hospitality, among other things, are covered. Members

of the Board of Directors of Kesko Corporation are also trained on the topic to the same

extent as executive management.

The unified guidelines and training help to ensure that everyone at Kesko has the same

understanding of the anti-corruption and anti-bribery principles and practices that guide

daily work. The training also includes a section on Kesko‘s SpeakUp channel, with

information such as where to find the channel and how to use it.

Compliance with the anti-corruption and anti-bribery operating model throughout Kesko‘s

entire operation chain requires knowing our partners and ensuring their commitment to the

contract terms. Kesko‘s business partners are expected to have an operating practices that

prevent corruption and bribery. This is ensured in contracts with partners by requiring them

to commit to the K Code of Conduct for business partners or equivalent instructions, and by

requiring suppliers to commit to the amfori BSCI Code of Conduct. A violation of these may

even lead to termination of the contractual relationship. Kesko may seek compensation from

a business partner for damages caused by the violation.

Confirmed incidents of corruption or

bribery (G1-4)

In 2025, no confirmed cases of corruption or bribery came to Kesko’s attention, and no

related court judgments or fines were imposed. All SpeakUp reports at Kesko, including

those concerning corruption or bribery, are independently investigated by Kesko’s

Governance, Compliance & Ethics function. SpeakUp cases are reported regularly to the

Audit Committee of the Board of Directors and, where the investigation so requires, to other

management. Kesko cooperates with the authorities as required by law.


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APPENDICES TO SUSTAINABILITY STATEMENT

List of data points that derive from other EU legislation


Disclosure requirement and related data point	SFDR reference	Pillar 3 reference	Benchmark regulation reference	EU climate law reference	Materiality	Page
ESRS 2 GOV-1 Board's gender diversity paragraph 21 (d)	Indicator number 13of Table #1 of Annex 1		Commission Delegated Regulation (EU) 2020/1816, Annex II		Material	25
ESRS 2 GOV-1 Percentage of board members who are independent paragraph 21 (e)			Delegated Regulation (EU) 2020/1816, Annex II		Material	25
ESRS 2 GOV-4 Statement on due diligence paragraph 30	Indicator number 10 Table #3 of Annex 1				Material	28
ESRS 2 SBM-1 Involvement in activities related to fossil fuel activities paragraph 40 (d) i	Indicators number 4 Table #1 of Annex 1	Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/245328Table 1: Qualitative information on Environmental risk and Table 2: Qualitative information on Social risk	Delegated Regulation (EU) 2020/1816, Annex II		Non-material
ESRS 2 SBM-1 Involvement in activities related to chemical production paragraph 40 (d) ii	Indicator number 9 Table #2 of Annex 1		Delegated Regulation (EU) 2020/1816, Annex II		Non-material
ESRS 2 SBM-1 Involvement in activities related to controversial weapons paragraph 40 (d) iii	Indicator number 14 Table #1 of Annex 1		Delegated Regulation (EU) 2020/1818, Article 12(1) Delegated Regulation (EU) 2020/1816, Annex II		Non-material
ESRS 2 SBM-1 Involvement in activities related to cultivation and production of tobacco paragraph 40 (d) iv			Delegated Regulation (EU) 2020/1818, Article 12(1) Delegated Regulation (EU) 2020/1816, Annex II		Non-material
ESRS E1-1 Transition plan to reach climate neutrality by 2050 paragraph 14				Regulation (EU) 2021/1119, Article 2(1)	Material	55, 56
ESRS E1-1 Undertakings excluded from Paris-aligned Benchmarks paragraph 16 (g)		Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 1: Banking book- Climate Change transition risk: Credit quality of exposures by sector, emissions and residual maturity	Delegated Regulation (EU) 2020/1818, Article12.1 (d) to (g), and Article 12.2		Material	55


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Disclosure requirement and related data point	SFDR reference	Pillar 3 reference	Benchmark regulation reference	EU climate law reference	Materiality	Page
ESRS E1-4 GHG emission reduction targets paragraph 34	Indicator number 4 Table #2 of Annex 1	Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 3: Banking book – Climate change transition risk: alignment metrics	Delegated Regulation (EU) 2020/1818, Article 6		Material	61, 62
ESRS E1-5 Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors) paragraph 38	Indicator number 5 Table #1 and Indicator n. 5 Table #2 of Annex 1				Material	63
ESRS E1-5 Energy consumption and mix paragraph 37	Indicator number 5 Table #1 of Annex 1				Material	63
ESRS E1-5 Energy intensity associated with activities in high climate impact sectors paragraphs 40 to 43	Indicator number 6 Table #1 of Annex 1				Material	63
ESRS E1-6 Gross Scope 1, 2, 3 and Total GHG emissions paragraph 44	Indicators number 1 and 2 Table #1 of Annex 1	Article 449a; Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 1:Banking book – Climate change transition risk: Credit quality of exposures by sector, emissions and residual maturity	Delegated Regulation (EU) 2020/1818, Article 5(1), 6 and 8(1)		Material	66
ESRS E1-6 Gross GHG emissions intensity paragraphs 53 to 55	Indicators number 3 Table #1 of Annex 1	Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 Template 3: Banking book – Climate change transition risk: alignment metrics	Delegated Regulation (EU) 2020/1818, Article 8(1)		Material	67
ESRS E1-7 GHG removals and carbon credits paragraph 56				Regulation (EU) 2021/1119, Article 2(1)	Material	56
ESRS E1-9 Exposure of the benchmark portfolio to climate-related physical risks paragraph 66			Delegated Regulation (EU) 2020/1818, Annex II Delegated Regulation (EU) 2020/1816, Annex II		Phased-in
ESRS E1-9 Disaggregation of monetary amounts by acute and chronic physical risk paragraph 66 (a), ESRS E1-9 Location of significant assets at material physical risk paragraph 66 (c).		Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 paragraphs 46 and 47; Template 5: Banking book - Climate change physical risk: Exposures subject to physical risk.			Phased-in


		112


Disclosure requirement and related data point	SFDR reference	Pillar 3 reference	Benchmark regulation reference	EU climate law reference	Materiality	Page
ESRS E1-9 Breakdown of the carrying value of its real estate assets by energy-efficiency classes paragraph 67 (c).		Article 449a Regulation (EU) No 575/2013; Commission Implementing Regulation (EU) 2022/2453 paragraph 34; Template 2: Banking book -Climate change transition risk: Loans collateralised by immovable property - Energy efficiency of the collateral			Phased-in
ESRS E1-9 Degree of exposure of the portfolio to climate- related opportunities paragraph 69			Delegated Regulation (EU) 2020/1818, Annex II		Phased-in
ESRS E2-4 Amount of each pollutant listed in Annex II of the E- PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil, paragraph 28	Indicator number 8 Table #1 of Annex 1 Indicator number 2 Table #2 of Annex 1 Indicator number 1 Table #2 of Annex 1 Indicator number 3 Table #2 of Annex 1				Non-material
ESRS E3-1 Water and marine resources paragraph 9	Indicator number 7 Table #2 of Annex 1				Non-material
ESRS E3-1 Dedicated policy paragraph 13	Indicator number 8 Table 2 of Annex 1				Non-material
ESRS E3-1 Sustainable oceans and seas paragraph 14	Indicator number 12 Table #2 of Annex 1				Non-material
ESRS E3-4 Total water recycled and reused paragraph 28 (c)	Indicator number 6.2 Table #2 of Annex 1				Non-material
ESRS E3-4 Total water consumption in m3 per net revenue on own operations paragraph 29	Indicator number 6.1 Table #2 of Annex 1				Non-material
ESRS 2- IRO 1 - E4 paragraph 16 (a) i	Indicator number 7 Table #1 of Annex 1				Material	39
ESRS 2- IRO 1 - E4 paragraph 16 (b)	Indicator number 10 Table #2 of Annex 1				Material	39
ESRS 2- IRO 1 - E4 paragraph 16 (c)	Indicator number 14 Table #2 of Annex 1				Material	39
ESRS E4-2 Sustainable land / agriculture practices or policies paragraph 24 (b)	Indicator number 11 Table #2 of Annex 1				Phased-in
ESRS E4-2 Sustainable oceans / seas practices or policies paragraph 24 (c)	Indicator number 12 Table #2 of Annex 1				Phased-in
ESRS E4-2 Policies to address deforestation paragraph 24 (d)	Indicator number 15 Table #2 of Annex 1				Phased-in


		113


Disclosure requirement and related data point	SFDR reference	Pillar 3 reference	Benchmark regulation reference	EU climate law reference	Materiality	Page
ESRS E5-5 Non-recycled waste paragraph 37 (d)	Indicator number 13 Table #2 of Annex 1				Material	76
ESRS E5-5 Hazardous waste and radioactive waste paragraph 39	Indicator number 9 Table #1 of Annex 1				Material	76
ESRS 2- SBM3 - S1 Risk of incidents of forced labour paragraph 14 (f)	Indicator number 13 of Table #1of Annex 1				Non-material
ESRS 2- SBM3 - S1 Risk of incidents of child labour paragraph 14 (g)	Indicator number 12 Table #3 of Annex I				Non-material
ESRS S1-1 Human rights policy commitments paragraph 20	Indicator number 9 Table #3 and Indicator number 11 Table #1 of Annex I				Material	80
ESRS S1-1 Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8, paragraph 21			Delegated Regulation (EU) 2020/1816, Annex II		Non-material
ESRS S1-1 processes and measures for preventing trafficking in human beings paragraph 22	Indicator number 11 Table #3 of Annex I				Non-material
ESRS S1-1 workplace accident prevention policy or management system paragraph 23	Indicator number 1 Table #3 of Annex I				Material	80, 81
ESRS S1-3 grievance/complaints handling mechanisms paragraph 32 (c)	Indicator number 5 Table #3 of Annex I				Material	82, 83
ESRS S1-14 Number of fatalities and number and rate of work-related accidents paragraph 88 (b) and (c)	Indicator number 2 Table #3 of Annex I		Delegated Regulation (EU) 2020/1816, Annex II		Material	91
ESRS S1-14 Number of days lost to injuries, accidents, fatalities or illness paragraph 88 (e)	Indicator number 3 Table #3 of Annex I				Material	91
ESRS S1-16 Unadjusted gender pay gap paragraph 97 (a)	Indicator number 12 Table #1 of Annex I		Delegated Regulation (EU) 2020/1816, Annex II		Material	91
ESRS S1-16 Excessive CEO pay ratio paragraph 97 (b)	Indicator number 8 Table #3 of Annex I				Material	91
ESRS S1-17 Incidents of discrimination paragraph 103 (a)	Indicator number 7 Table #3 of Annex I				Material	92
ESRS S1-17 Non-respect of UNGPs on Business and Human Rights and OECD paragraph 104 (a)	Indicator number 10 Table #1 and Indicator n. 14 Table #3 of Annex I		Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818 Art 12 (1)		Non-material


		114


Disclosure requirement and related data point	SFDR reference	Pillar 3 reference	Benchmark regulation reference	EU climate law reference	Materiality	Page
ESRS 2- SBM3 – S2 Significant risk of child labour or forced labour in the value chain paragraph 11 (b)	Indicators number 12 and n. 13 Table #3 of Annex I				Material	93, 94
ESRS S2-1 Human rights policy commitments paragraph 17	Indicator number 9 Table #3 and Indicator n. 11 Table #1 of Annex 1				Material	94
ESRS S2-1 Policies related to value chain workers paragraph 18	Indicator number 11 and n. 4 Table #3 of Annex 1				Material	94, 95
ESRS S2-1 Non-respect of UNGPs on Business and Human Rights principles and OECD guidelines paragraph 19	Indicator number 10 Table #1 of Annex 1		Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1)		Material	95
ESRS S2-1 Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8, paragraph 19			Delegated Regulation (EU) 2020/1816, Annex II		Material	94, 95
ESRS S2-4 Human rights issues and incidents connected to its upstream and downstream value chain paragraph 36	Indicator number 14 Table #3 of Annex 1				Material	97
ESRS S3-1 Human rights policy commitments paragraph 16	Indicator number 9 Table #3 of Annex 1 and Indicator number 11 Table #1 of Annex 1				Non-material
ESRS S3-1 non-respect of UNGPs on Business and Human Rights, ILO principles or and OECD guidelines paragraph 17	Indicator number 10 Table #1 Annex 1		Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1)		Non-material
ESRS S3-4 Human rights issues and incidents paragraph 36	Indicator number 14 Table #3 of Annex 1				Non-material
ESRS S4-1 Policies related to consumers and end-users paragraph 16	Indicator number 9 Table #3 and Indicator number 11 Table #1 of Annex 1				Material	100
ESRS S4-1 Non-respect of UNGPs on Business and Human Rights and OECD guidelines paragraph 17	Indicator number 10 Table #1 of Annex 1		Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1)		Material	100
ESRS S4-4 Human rights issues and incidents paragraph 35	Indicator number 14 Table #3 of Annex 1				Material	100
ESRS G1-1 United Nations Convention against Corruption paragraph 10 (b)	Indicator number 15 Table #3 of Annex 1				Non-material
ESRS G1-1 Protection of whistleblowers paragraph 10 (d)	Indicator number 6 Table #3 of Annex 1				Material	107


		115


Disclosure requirement and related data point	SFDR reference	Pillar 3 reference	Benchmark regulation reference	EU climate law reference	Materiality	Page
ESRS G1-4 Fines for violation of anti-corruption and anti- bribery laws paragraph 24 (a)	Indicator number 17 Table #3 of Annex 1		Delegated Regulation (EU) 2020/1816, Annex II)		Material	109
ESRS G1-4 Standards of anti-corruption and anti-bribery paragraph 24 (b)	Indicator number 16 Table #3 of Annex 1				Non-material


		116

FINANCIAL STATEMENTS


Consolidated financial statements (IFRS) ....................	117
Consolidated income statement ......................................	117
Consolidated statement of comprehensive income ......	117
Consolidated statement of financial position .................	118
Consolidated statement of cash flows ............................	119
Consolidated statement of changes in equity ................	120
1. General accounting policies .......................................	121
1.1 Basic information about the Company ....................	121
1.2 Basis of preparation ..................................................	121
1.3 Key accounting estimates and assumptions ..........	121
1.4 Significant judgements applied in the application of accounting policies ....................................................	122
1.5 Consolidation principles ...........................................	122
1.6 Discontinued operations and non-current assets classified as held for sale and related liabilities ...........	123
1.7 New IFRS standards and IFRIC interpretations and the impact of new and updated standards ...........	124
2. Financial results ...........................................................	125
2.1 Revenue recognition ................................................	125
2.2 Segment information ...............................................	125
2.3 Material and services ...............................................	134
2.4 Other operating income ..........................................	134
2.5 Operating expenses .................................................	134
2.6 Foreign exchange differences recognised in operating profit ...............................................................	135
2.7 Income tax .................................................................	135
2.8 Earnings per share ...................................................	138
2.9 Additional information on the statement of cash flows .................................................................................	138


3. Capital employed .........................................................	139
3.1 Acquisitions ...............................................................	139
3.2 Property, plant and equipment ...............................	141
3.3 Intangible assets .......................................................	142
3.4 Leases ........................................................................	146
3.5 Inventories ................................................................	148
3.6 Current receivables ..................................................	149
3.7 Pension assets ...........................................................	150
3.8 Shares in associates and joint ventures .................	154
3.9 Provisions ..................................................................	155
4. Capital structure and financial risks .........................	156
4.1 Capital management ................................................	156
4.2 Shareholders' equity ................................................	158
4.3 Financial risks ...........................................................	159
4.4 Finance income and expenses ................................	165
4.5 Financial assets and liabilities by category ............	165
4.6 Commitments and contingencies ...........................	169
5. Other .............................................................................	170
5.1 Subsidiaries, associates, joint ventures and proportionately consolidated mutual real estate companies .......................................................................	170
5.2 Related party transactions ......................................	172
5.3 Share-based compensation .....................................	174
5.4 Legal disputes and possible legal proceedings ....	176
5.5 Events after the balance sheet date .......................	176
Parent company's financial statements (FAS) .............	177
Signatures .........................................................................	193


Auditor's report ...............................................................	194
Assurance report on the sustainability statement ......	198
Independent auditor’s report on the ESEF consolidated financial statements of Kesko Oyj .........	201

This report is a translation of the Finnish original.


		117

CONSOLIDATED FINANCIAL STATEMENTS (IFRS)

Consolidated income statement


€ million	Note	1 Jan.–31 Dec. 2025	1 Jan.–31 Dec. 2024
Net sales	2.1	12,474.7	11,920.1
Materials and services	2.3	-10,702.7	-10,184.1
Change in inventory		36.3	-21.6
Other operating income	2.4	999.4	994.6
Employee benefit expense	2.5	-911.9	-842.5
Depreciation, amortisation and impairment charges	3.2 3.3	-239.1	-247.9
Depreciation and impairment charges for right-of-use assets	3.4	-359.1	-375.5
Other operating expenses	2.5	-685.8	-684.5
Share of result of joint ventures		19.5	20.9
Operating profit		631.3	579.5
Interest income and other finance income	4.4	14.9	17.7
Interest expense and other finance costs	4.4	-49.6	-49.5
Interest expense for lease liabilities	4.4	-89.4	-78.6
Foreign exchange differences	4.4	-1.2	-1.3
Total finance income and expenses	4.4	-125.4	-111.7
Share of result of associates		4.4	3.8
Profit before tax		510.3	471.5
Income tax	2.7	-105.5	-92.0
Profit for the period		404.8	379.6

Profit for the period attributable to
Owners of the parent		404.2	379.1
Non-controlling interests		0.7	0.4

Earnings per share for profit attributable to owners of the parent
Basic and diluted, €	2.8	1.02	0.95

Consolidated statement of comprehensive income


€ million	Note	1 Jan.–31 Dec. 2025	1 Jan.–31 Dec. 2024
Profit for the period		404.8	379.6
Items that will not be reclassified subsequently to profit or loss
Actuarial gains and losses	2.7 3.7	14.1	37.6
Items that may be reclassified subsequently to profit or loss
Currency translation differences on foreign operations	2.7	19.0	-31.6
Share of other comprehensive income of associates and joint ventures	2.7	-	0.5
Cash flow hedge revaluation	2.7	3.3	-7.7
Total comprehensive income for the period, net of tax		36.4	-1.2
Total comprehensive income for the period		441.2	378.3

Comprehensive income for the period attributable to
Owners of the parent		440.5	377.9
Non-controlling interests		0.7	0.4


		118

Consolidated statement of financial position


€ million	Note	31 Dec. 2025	31 Dec. 2024
ASSETS
Non-current assets
Property, plant and equipment	3.2	2,754.6	2,403.3
Goodwill	3.3	721.6	643.0
Intangible assets	3.3	212.5	234.2
Right-of-use assets	3.4	1,906.5	1,867.7
Shares in associates and joint ventures	3.8 5.1	263.2	239.7
Other investments	4.3 4.5	15.7	14.8
Non-current receivables	4.3 4.5	68.2	65.9
Deferred tax assets	2.7	20.0	16.9
Pension assets	3.7	147.4	127.5
Total non-current assets		6,109.8	5,612.9

Current assets
Inventories	3.5	1,204.0	1,101.5
Interest-bearing receivables	3.6 4.5	0.7	4.2
Trade receivables	3.6 4.3 4.5	1,014.8	957.9
Income tax assets	3.6	18.0	12.9
Other non-interest-bearing receivables	3.6 4.5	309.6	287.1
Other financial assets	4.3 4.5	-	15.0
Cash and cash equivalents	4.5	166.2	473.1
Total current assets		2,713.3	2,851.7
Non-current assets classified as held for sale		-	6.6
Total assets		8,823.1	8,471.2


€ million	Note	31 Dec. 2025	31 Dec. 2024
EQUITY AND LIABILITIES
Share capital	4.2	197.3	197.3
Share premium	4.2	197.8	197.8
Other reserves	4.2	266.8	266.8
Currency translation differences	4.2	-84.3	-103.3
Revaluation reserve	4.2	-0.1	-3.4
Treasury shares		-17.2	-22.8
Retained earnings		2,237.4	2,189.7
Equity		2,797.7	2,722.1
Non-controlling interests		29.0	12.9
Total equity		2,826.7	2,734.9

Non-current liabilities
Interest-bearing non-current liabilities	4.3 4.5 4.6	1,285.9	1,054.0
Lease liabilities	4.5 4.6	1,752.9	1,628.8
Non-interest-bearing non-current liabilities	4.3 4.5	61.3	42.8
Deferred tax liabilities	2.7	101.6	76.3
Provisions	3.9	4.3	6.3
Total non-current liabilities		3,206.0	2,808.1

Current liabilities
Current interest-bearing liabilities	4.3 4.5 4.6	189.3	291.3
Lease liabilities	4.5 4.6	344.6	422.2
Trade payables	4.3 4.5	1,388.3	1,404.4
Other non-interest-bearing liabilities	4.3 4.5	336.8	342.4
Income tax liabilities		9.3	12.2
Accrued liabilities	4.3 4.5	507.7	442.4
Provisions	3.9	14.5	13.2
Total current liabilities		2,790.4	2,928.1
Liabilities related to non-current assets classified as held for sale		-	0.1
Total liabilities		5,996.4	5,736.2
Total equity and liabilities		8,823.1	8,471.1


		119

Consolidated statement of cash flows


€ million	Note	1 Jan.–31 Dec. 2025	1 Jan.–31 Dec. 2024
Cash flows from operating activities
Profit before tax		510.3	471.5
Adjustments
Depreciation according to plan		225.5	207.4
Depreciation and impairment for right-of-use assets		359.1	375.5
Finance income and expenses		36.0	33.1
Interest expense for lease liabilities		89.4	78.6
Other adjustments	2.9	-16.8	22.2
		693.1	716.9
Change in working capital
Current non-interest-bearing receivables, increase (-)/decrease (+)		-17.7	43.8
Inventories, increase (-)/decrease (+)		-36.3	25.5
Current non-interest-bearing liabilities, increase (+)/ decrease (-)		-66.5	-44.8
		-120.5	24.5

Interest paid and other finance costs		-37.7	-45.6
Interest paid on lease liabilities		-89.4	-78.6
Interest received		14.7	16.9
Dividends and capital repayments received from associated companies and joint ventures		5.5	22.3
Dividends received from others		0.6	0.5
Income taxes paid		-97.0	-120.2
Net cash flows from operating activities, total		879.7	1,008.2


€ million	Note	1 Jan.–31 Dec. 2025	1 Jan.–31 Dec. 2024
Cash flows from investing activities
Payments for acquisition of subsidiary shares, net of cash acquired	3.1	-156.8	-151.6
Payments for investments consolidated using the equity method		-0.1	-0.1
Payments for property, plant, equipment and intangible assets	2.9	-502.3	-491.4
Proceeds from sale of property, plant, equipment and intangible assets		102.1	45.0
Proceeds from sale of other investments		0.3	0.0
Loan receivables and other financial assets, increase (-)/decrease (+)		15.0	0.5
Net cash flows from investing activities, total		-541.8	-597.5

Cash flows from financing activities
Interest-bearing liabilities, increase (+)/decrease (-)	4.1	63.1	534.0
Repayments for lease liabilities	3.4 4.1	-358.5	-370.9
Interest-bearing receivables, increase (-)/ decrease (+)	4.1	7.2	3.9
Dividends paid		-370.2	-320.3
Equity capital increases		15.5	-
Other items		-1.8	3.5
Net cash flows from financing activities, total		-644.7	-149.8

Change in cash and cash equivalents		-306.9	260.9

Cash and cash equivalents as at 1 January	4.5	473.1	211.9
Translation adjustment and fair value change		0.0	0.3
Cash and cash equivalents as at 31 December	4.5	166.2	473.1


		120

Consolidated statement of changes in equity


€ million	Share capital	Reserves	Currency translation differences	Revaluation reserve	Treasury shares	Retained earnings	Non-controlling interests	Total
Balance as at 1 January 2025	197.3	464.7	-103.3	-3.4	-22.8	2,189.7	12.9	2,734.9
Share-based payments					5.7			5.7
Dividends						-358.3		-358.3
Change in non-controlling interests						-18.0	-	-18.0
Transactions with non-controlling interests							15.5	15.5
Other changes		-0.0	-	0.0		5.8		5.8
Transactions with owners, total		-0.0	-	0.0	5.7	-370.5	15.5	-349.4
Comprehensive income
Profit for the period						404.2	0.7	404.8
Actuarial gains and losses						14.1		14.1
Currency translation differences on foreign operations			19.0			0.0	0.0	19.0
Cash flow hedge revaluation				3.3		-		3.3
Total other comprehensive income for the period, net of tax			19.0	3.3		14.1	0.0	36.4
Total comprehensive income for the period			19.0	3.3		418.3	0.7	441.2
Balance as at 31 December 2025	197.3	464.7	-84.3	-0.1	-17.2	2,237.4	29.0	2,826.7

Balance as at 1 January 2024	197.3	464.7	-71.7	4.3	-26.7	2,190.6	-	2,758.4
Share-based payments					3.9			3.9
Dividends						-405.9		-405.9
Increase of non-controlling interests						-17.0	12.4	-4.5
Other changes		-0.0	-	-		4.8		4.8
Transactions with owners, total		-0.0	-	-	3.9	-418.1	12.4	-401.8
Comprehensive income
Profit for the period						379.1	0.4	379.6
Actuarial gains and losses						37.6		37.6
Currency translation differences on foreign operations			-31.6			-	-	-31.6
Share of other comprehensive income of associates and joint ventures				-		0.5		0.5
Cash flow hedge revaluation				-7.7		-		-7.7
Total other comprehensive income for the period, net of tax			-31.6	-7.7		38.1	-	-1.2
Total comprehensive income for the period			-31.6	-7.7		417.2	0.4	378.3
Balance as at 31 December 2024	197.3	464.7	-103.3	-3.4	-22.8	2,189.7	12.9	2,734.9

Further information on share capital and reserves is disclosed in Note 4.2 and on share-award plans in Note 5.3. Deferred tax related to components of other comprehensive income is

presented in Note 2.7 .


		121

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. GENERAL ACCOUNTING POLICIES

The notes to the consolidated financial statements have

been grouped into sections based on their subject. The

basis of preparation is described as part of this note, while

the accounting policies directly related to a specific note are

presented as part of the note in question. The notes contain

the relevant financial information as well as a description of

the accounting policies and key estimates and judgements

applied for the topics of the individual note.

1.1 Basic information about the Company

Kesko is a Finnish listed trading sector company. Kesko has

approximately 1,700 stores engaged in chain operations in

Finland, Sweden, Norway, Denmark, Estonia, Latvia,

Lithuania and Poland.

Kesko Group's reportable segments consist of its business

divisions, namely the grocery trade, the building and

technical trade, and the car trade.

The Group's parent company, Kesko Corporation, is a

Finnish public limited company constituted in accordance

with the laws of Finland. The Company's business ID is

0109862-8, it is domiciled in Helsinki, Finland and its

registered address is PO Box 1, 00016 KESKO, Finland.

Copies of Kesko Corporation's financial statements and the

consolidated financial statements are available from Kesko

Corporation, visiting address Työpajankatu 12, Helsinki,

Finland and from the internet at www.kesko.fi/en.

These consolidated financial statements were authorised for

issue by the Board of Directors on 4 February 2026.

Kesko has issued an XHTML financial review complying

with the ESEF requirements on Kesko’s website. The Audit

firm Deloitte Oy has provided to company an independent

auditor’s reasonable assurance report in accordance with

ISAE 3000 (Revised) on Kesko’s ESEF Financial Statements.

1.2 Basis of preparation

Kesko's consolidated financial statements have been

prepared in accordance with International Financial

Reporting Standards (IFRS) approved for adoption by the

European Union, and they comply with the IAS and IFRS

standards and respective SIC and IFRIC Interpretations

effective on 31 December 2025. The International Reporting

Standards refer to standards and their interpretations

approved for adoption within the EU in accordance with the

procedure enacted in EU regulation (EC) 1606/2002,

included in the Finnish Accounting Act and regulations

based on it. The Group has applied new and amended

standards that became effective in the financial year that

began on 1 January 2025. The improvements and

amendments to existing standards did not have an impact

on the consolidated financial statements. Accounting

standards not yet effective have not been adopted

voluntarily for the consolidated financial statements. The

notes to the consolidated financial statements also include

compliance with Finnish accounting and corporate

legislation.

All amounts in the consolidated financial statements are in

millions of euros and based on original cost, with the

exception of items specified below, which have been

measured at fair value in compliance with the standards.

1.3 Key accounting estimates and

assumptions

The preparation of consolidated financial statements in

conformity with international accounting standards requires

the use of certain estimates and assumptions about the

future that affect the reported amounts of assets and

liabilities, contingent liabilities, and income and expense.

The actual results may differ from these estimates and

assumptions.

The impact of climate risks has been assessed on the

Group’s business operations and the consolidated financial

statements. Climate change related risks on Kesko are

assessed based on selected climate scenarios. Kesko Group

has not identified any business operations subject to

material climate risks in terms of business continuity or

valuation of asset items. Kesko owns and manages via

leases a substantial number of properties in all its operating

countries. Individual asset items may be subject to risks of

damage or investment needs due to, for example, extreme

weather phenomena.

The estimates and judgements made are continuously

evaluated, and they are based on historical experience and


		122

other factors, including expectations of future events that

are believed to be reasonable under the circumstances.

The key accounting estimates and assumptions used in the

preparation of consolidated financial statements are further

described in the corresponding notes.

• Income tax (Note 2.7)

• Acquisitions (Note 3.1)

• Intangible assets (Note 3.3)

• Leases (Note 3.4)

• Inventories (Note 3.5)

• Trade and other current receivables (Note 3.6)

• Pension assets (Note 3.7)

• Provisions (Note 3.9)

1.4 Significant judgements applied in the

application of accounting policies

The Group's management uses its judgement in the

adoption and application of accounting policies in the

financial statements. The management has exercised its

judgement in the application of accounting policies in the

income statement with regard to the presentation of income

(Note 2.1), the existence of control over subsidiaries (Note

1.5), measuring receivables, determining provisions for

restructuring, and measuring assets and liabilities

recognised in the balance sheet based on lease agreements

(Note 3.4).

1.5 Consolidation principles

Subsidiaries

The consolidated financial statements combine the financial

statements of Kesko Corporation and subsidiaries

controlled by the Group. Control exists when the Group has

more than half of the voting rights of a subsidiary or

otherwise exercises control. An investor controls an

investee when it is exposed, or has rights, to variable

returns from its involvement with the investee and has the

ability to affect those returns through its power over the

investee. Acquired subsidiaries are consolidated from the

date on which the Group gains control until the date on

which control ceases. The existence of potential voting

rights has been considered when assessing the existence of

control in the case that the instruments entitling to potential

control are currently exercisable. Subsidiaries are listed in

Note 5.1.

Mutual shareholding is eliminated by using the acquisition

cost method. The cost of assets acquired is determined on

the basis of the fair value of the acquired assets as at the

acquisition date, the issued equity instruments and liabilities

resulting from or assumed on the date of the exchange

transaction. The identifiable assets, liabilities and

contingent liabilities acquired are measured at the fair value

at the acquisition date, gross of non-controlling interest.

Intragroup transactions, receivables and payables,

unrealised profits and internal distributions of profits are

eliminated when preparing the consolidated financial

statements. Unrealised losses are not eliminated if the loss

is due to the impairment of an asset. Non-controlling

interest in the profit for the period is disclosed in the

income statement and the amount of equity attributable to

the non-controlling interests is disclosed separately in

equity.

The Group accounts for its real estate company acquisitions

as acquisitions of assets.

Associates

Associates are companies over which the Group has

significant influence but not control. In Kesko Group,

significant influence accompanies a shareholding or

agreement of between 20% and 50% of the voting rights.

Investments in associates are accounted for using the

equity method and are initially recognised at cost.

The Group’s share of post-acquisition profits or losses is

recognised in the income statement. The cumulative post-

acquisition movements are adjusted against the carrying

amount of the investment. If the Group’s share of losses in

an associate equals or exceeds its interest in the associate,

the Group does not recognise further losses.

Unrealised gains on transactions between the Group and

the associates are eliminated to the extent of the Group’s

interest in the associates. Unrealised losses are also

eliminated, unless the transaction provides evidence of an

impairment of the asset transferred. Dividends received

from associates are deducted from the Group's result and

the cost of the shares. An investment in an associate

includes the goodwill generated by the acquisition.

Goodwill is not amortised.


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Joint agreements

Joint agreements are arrangements in which the sharing of

joint control has been contractually agreed between two or

more parties. Joint control exists only when decisions about

the relevant activities require the unanimous consent of the

parties sharing control. A joint venture is a joint agreement

whereby the parties that have joint control of the

agreement have rights to the net assets of the agreement.

Investments in joint ventures are accounted for using the

equity method, and on initial recognition, they are

recognised at cost.

The Group’s share of post-acquisition profits or losses is

recognised in the income statement. The cumulative post-

acquisition movements are adjusted against the carrying

amount of the investment. If the Group’s share of losses in

a joint venture equals or exceeds its interest in the joint

venture, the Group does not recognise further losses.

Unrealised gains on transactions between the Group and

the joint ventures are eliminated to the extent of the

Group’s interests in the joint ventures. Unrealised losses are

also eliminated, unless the transaction provides evidence of

an impairment of the asset transferred. Dividends received

from joint ventures are deducted from the Group's result

and the cost of the shares. An investment in a joint venture

includes the goodwill generated by the acquisition.

Goodwill is not amortised.

Mutual real estate companies are consolidated as joint

operations on a line-by-line basis in proportion to

ownership. The Group's share of mutual real estate

companies' loans and equity reserves is accounted for

separately in the consolidation.

Associates and joint ventures and proportionately

consolidated mutual real estate companies are listed in

Note 5.1.

Foreign currency items

The consolidated financial statements are presented in

euros, which is both the functional currency of the

environment in which the Group’s parent operates and the

presentation currency. On initial recognition, the amounts

with respect to the result and financial position of the

Group companies located outside the euro zone are

recorded in the functional currency of each of their

operating environments.

Foreign currency transactions are recorded in euros by

applying the exchange rate at the date of the transaction.

Receivables and liabilities denominated in foreign currency

are translated into euros using the closing rate. Exchange

rate gains and losses on foreign currency transactions as

well as receivables and liabilities denominated in foreign

currency are recognised in the income statement, with the

exception of monetary items that form a part of a net

investment in a foreign operation and loans designated as

hedges for foreign net investments and regarded as

effective. These exchange differences are recognised in

equity and their changes are presented in other

comprehensive income. The exchange differences are

presented in the income statement on disposal of the

foreign operation or settlement of the hedges. The Group

has currently no loans designated as hedges for foreign net

investments. Foreign exchange gains and losses resulting

from operating activities are included in the respective

items above operating profit. Foreign exchange gains and

losses from foreign exchange forward contracts and options

used for hedging financial transactions, and from foreign

currency loans are included in finance income and

expenses.

The income statements of the Group companies operating

outside the euro zone have been translated into euros at the

average rate of the financial year, and their balance sheets

at the closing rate. The foreign exchange difference

resulting from the use of different rates, the translation

differences arising from the elimination of the acquisition

cost of subsidiaries outside the euro zone, exchange

differences arising from monetary items that form a part of

a net investment in a foreign operation and the hedging

results of net investments are recognised in equity, and the

changes are presented in other comprehensive income. In

connection with the disposal of a subsidiary, translation

differences are recognised in the income statement as part

of the gains or losses on the disposal.

Goodwill arising on the acquisition of foreign operations

and the fair value adjustments of assets and liabilities made

upon their acquisition are treated as assets and liabilities of

these foreign operations and translated into euros at the

closing rate.

1.6 Discontinued operations and non-

current assets classified as held for sale and

related liabilities

Non-current assets (or a disposal group) are classified as

held for sale if their carrying amount will be recovered

principally through the disposal of the assets and the sale is

highly probable. If their carrying amount will be recovered

principally through their disposal rather than through their

continuing use, they are measured at the lower rate of the

carrying amount and fair value net of costs to sell.


		124

The comparative information in the income statement is

adjusted for operations classified as discontinued during the

latest financial period being reported. Consequently, the

result of discontinued operations is presented as a separate

line items also for the comparatives. The Group did not

have any discontinued operations in 2025 and 2024.

1.7 New IFRS standards and IFRIC

interpretations and the impact of new and

updated standards

New ‘IFRS 18 Presentation and Disclosure in

Financial Statements’

The new standard ‘IFRS 18 Presentation and Disclosure in

Financial Statements’ was published on 9 April 2024, and it

will be effective for financial reporting periods beginning on

or after 1 January 2027. Comparison period shall be

restated accordingly. The new standard includes

instructions especially in relation to the presentation of the

statement of profit or loss. The standard includes two

defined subtotals and one total which shall be presented in

the statement of profit or loss: the subtotals are ‘operating

profit’ and ‘profit before financing and income taxes’ and

the total is ‘profit for the year’. According to the standard,

income and expenses included in the statement of profit or

loss shall be classified under five categories: operating,

investing, financing, income tax and discontinued

operations. The standard also requires the presentation of

Management-defined Performance Measures in the

financial statements.

During the financial reporting period, the Group performed

an impact analysis regarding the implementation of IFRS 18.

Based on the analysis, the new standard will have an impact

on the presentation of the statement of profit or loss and

the information presented in the financial statements. The

most significant changes to the statement of profit or loss

concern the presentation of the share of result of associates

and joint ventures and income from cash and cash

equivalents and investments as well as gains or losses on

disposal of the aforementioned assets, which will be

presented in the investing category in accordance with IFRS

18. In addition, certain finance income and costs and

changes in the fair value of instruments used for hedging

will be presented in the operating category or the investing

category.

The Group uses alternative performance measures to

reflect business performance and profitability alongside

measures based on IFRS financial statements. According to

the impact analysis, some of the performance measures

used qualify as Management-defined Performance

Measures (MPM) as defined in IFRS 18. For these measures,

the financial statements shall, among other things, include

an explanation as to why the measures are used and a

reconciliation to the appropriate subtotal in the IFRS

financial statements. The Group will continue the analysis of

the detailed requirements of the standard and the

preparation of changes impacting the presentation of

financial statements in the 2026 financial reporting period.

Other annual improvements or amendments to existing

standards that become effective on or after 1 January 2026

are not estimated to have a material impact on the

consolidated financial statements.


		125

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2. FINANCIAL RESULTS

2.1 Revenue recognition

Accounting policies

In the consolidated income statement, net sales comprise the sales of goods, services and

energy based on customer agreements. The share of sales of services and energy of total

net sales is not significant. The Group sells products to retailers and other business

customers and engages in own retailing. Income from sales of goods and services is

recognised when the customer obtains control of the goods or services. Customers obtain

control when they have the ability to direct the use of and obtain the benefits from the

goods or services. As a rule, income from sales of goods can be recognised at the time of

transfer. Income from services is recognised as the service is being performed. Sales to

retailers and business customers are based on invoicing. Sales to consumers are mainly in

cash or by credit card.

When calculating net sales, sales revenue is adjusted for indirect taxes, sales adjustment

items and the exchange differences of foreign-currency-denominated sales. In businesses in

Finland that are part of the K-Plussa customer loyalty scheme, sales adjustment items

include loyalty award credits, recognised as part of sales transactions. Income from

corresponding sales is recognised when the award credits are redeemed or expire. Contract

liability is recognised in the balance sheet. Loyalty award credits affect the net sales of

those businesses that grant K-Plussa customer loyalty award credits in Finland and engage

in retailing.

Other operating income includes income other than that associated with the sale of goods

or services based on customer agreements, such as lease income, store site and chain fees

charged from retailers, and various other service fees and commissions. Fees charged from

retailer entrepreneurs are based on a partnership agreement (chain agreement) based on

which the retailers engage in business in line with the chain’s operating models and

objectives. Store site fees and chain fees vary depending on the growth and profitability of

the retailer’s business operations under the chain agreement. Chain marketing fees and

data system fees are cost-based charges. More detailed information on other operating

income is presented in Note 2.4.

Other operating income also includes gains on the disposal of property, plant and

equipment and intangible assets as well as gains on disposal of businesses and realised and

unrealised gains on derivatives used for hedging foreign currency risks associated with

commercial transactions.

Interest income is recognised on a time apportionment basis using the effective interest

method. Dividend income is recognised when the right to receive payment is established.

2.2 Segment information

Accounting policies

The Group's reportable segments are composed of the Group's divisions, namely the

grocery trade, the building and technical trade, and the car trade.

Segment information is reported in a manner consistent with the internal reporting provided

to the chief operating decision maker. The chief operating decision maker, responsible for

allocating resources to the divisions, has been identified as the Group Management Board.

The reportable operating segments derive their net sales from the grocery trade, the

building and technical trade, and the car trade. Sales between divisions are charged at

prevailing market rates.

The Group Management Board uses alternative performance measures alongside the IFRS

financial statements indicators in the Group’s results reporting. The Group Management

Board assesses the divisions' performances based on operating profit, comparable


		126

operating profit, and comparable return on capital employed. Results reporting to

management corresponds to the accounting policies of the consolidated financial

statements apart from items affecting comparability. Finance income and costs are not

allocated to the divisions as the Group’s cash and cash equivalents and financial liabilities

are managed by the Group Treasury. Changes in the fair values of intra-Group foreign

exchange forward contracts entered into and realised gains and losses are reported as part

of other operating income and expenses to the extent that they hedge the divisions’ foreign

exchange risk.

The assets and liabilities of a division's capital employed consist of operating items that can

be justifiably allocated to the divisions. The assets of capital employed comprise property,

plant and equipment and intangible assets, right-of-use assets related to leases, interests in

associates and joint ventures and other investments, pension assets, inventories, trade

receivables and other non-interest-bearing receivables, interest-bearing receivables, and

assets held for sale. The liabilities of capital employed consist of trade payables, the share of

other non-interest-bearing liabilities and provisions. The Group’s real estate assets and the

revenue and costs generated from them have been allocated to the divisions. Capital

employed does not include deferred tax assets and liabilities, financial assets at fair value

through profit or loss with the exception of fair value of foreign exchange forward contracts

recognised in the balance sheet, cash and cash equivalents, or interest-bearing liabilities.

The same revenue recognition policies apply to segment information as to the consolidated

financial statements and consolidated statement of financial position. The revenue

recognition policies are presented in Note 2.1.

Kesko’s business models

Kesko’s principal business model in the Finnish market is the chain business model, in which

independent K-retailers run retail stores in Kesko's chains, and B2B trade. Kesko manages

the operations of the chains made up of the stores. Chain operations ensure higher

competitiveness and a strong operational basis for K-retailers in terms of purchasing goods,

building selections, marketing and price competition. Outside Finland, Kesko mainly engages

in own retailing and B2B trade. Kesko’s wholesale to retailers accounted for 43% (45%) of the

Group’s net sales in 2025. B2B trade accounted for 41% (37%) of the Group’s net sales in

2025. Kesko’s B2C trade accounted for 16% (18%) of the Group’s net sales. The economic

factors of the above‑mentioned business models and their relative share of the Group’s

business volume affect the nature, amount, timing and uncertainty of the revenue and cash

flows included in the consolidated financial statements.

Grocery trade

The grocery trade division comprises the wholesale and B2B trade of groceries and the

retailing of home and speciality goods in Finland. There are approximately 1,100 grocery

stores operated by K-retailers in Finland. These stores form the K-Citymarket, K-

Supermarket and K-Market grocery retail chains. Kespro is a foodservice provider and

wholesaler in Finland. In K-Citymarket's home and speciality goods trade, Kesko operates as

a retailer in Finland.

Building and technical trade

The building and technical trade division operates in the wholesale, retail and B2B trade in

Finland, Sweden, Norway, Denmark, the Baltic countries and Poland. In building and home

improvement trade, Kesko operates with the K-retailer business model in Finland, and as a

retail operator in Sweden, Norway and Denmark. The retail store chains are K-Rauta

(Finland), K-Bygg (Sweden), Byggmakker (Norway) and Davidsen (Denmark). The building

and home improvement stores serve both consumers and business customers. Technical

trade provides HEPAC and electrical products and services to business customers. Technical

trade has around 140 places of business in Finland, Sweden, Norway, Poland and the Baltic

countries.

Kesko completed the acquisition of Roslev Trælasthandel A/S in Denmark on

February 1, 2025, CF Petersen & Søn A/S on May 1, 2025, and Tømmergaarden A/S on

June 1, 2025. In the comparison period, Kesko acquired a 90% ownership interest in

Davidsen Koncernen A/S in Denmark. The operations of the K-Rauta chain in Sweden were

discontinued in December 2024.

Car trade

The car trade division comprises the business operations of new cars, used cars, services and

leasing. The new cars business includes the import, marketing and retail of Volkswagen,

Audi, SEAT, CUPRA, Porsche and Bentley passenger cars and of Volkswagen commercial

vehicles in Finland, and the import of SEAT and CUPRA passenger cars in the Baltics. The

used car business includes the purchase of used cars from Finland and elsewhere and the

retail of the cars in Finland. The service business includes repair and maintenance services,


		127

spare parts sales and accessories services in Finland. The leasing business provides car

leasing services for both private and corporate customers. Services provided by the car trade

division also include the K-Lataus charging network for electric vehicles. In the comparison

period the business acquisition of Autotalo Lohja was completed.

Sports trade is included in the car trade division, and comprises in Finland the Intersport and

Budget Sport chains.

Common functions

Common functions comprise Group support functions.

Segment information 2025

Profit


€ million	Grocery trade	Building and technical trade	Car trade	Common functions	Total
Division net sales	6,447.4	4,685.8	1,364.8	2.1	12,500.2
of which intersegment sales	-15.9	-0.6	-8.3	-0.7	-25.5
Net sales from external customers	6,431.5	4,685.2	1,356.5	1.5	12,474.7

Change in net sales in local currency excluding acquisitions and disposals, %	1.0	1.4	12.0	-	2.3
Change in net sales, %	1.0	7.7	12.9	-	4.7

Other division income	832.1	129.2	28.0	14.1	1,003.4
of which intersegment income	-0.6	-1.7	0.4	-2.1	-4.0
Other operating income from external customers	831.5	127.5	28.3	12.0	999.4

Depreciation and amortisation	-120.2	-53.7	-36.6	-28.6	-239.1
Depreciation and impairment charges for right-of-use assets	-226.9	-101.2	-24.4	-6.6	-359.1
Share of result of joint ventures	-	19.5	-	-	19.5
Operating profit	416.6	159.2	82.4	-26.9	631.3

Items affecting comparability	-1.5	-19.4	-0.7	-2.0	-23.6
Comparable operating profit	418.1	178.6	83.1	-24.8	654.9

Finance income and costs					-125.4
Share of result of associates					4.4
Profit before tax					510.3


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Assets and liabilities


€ million	Grocery trade	Building and technical trade	Car trade	Common functions	Eliminations	Total
Property, plant, equipment and intangible assets	1,823.8	1,451.4	341.2	73.7	-1.3	3,688.8
Right-of-use assets	1,308.9	475.9	69.7	52.0	-	1,906.5
Interests in associates and joint ventures and other investments	6.1	181.4	0.1	91.9	-0.6	278.9
Pension assets	18.4	5.3	-	123.8	-	147.4
Inventories	291.3	663.4	249.3	-	-	1,204.0
Trade receivables	361.8	584.5	68.4	2.1	-2.1	1,014.8
Other non-interest-bearing receivables	70.8	236.0	27.9	40.0	-37.2	337.5
Interest-bearing receivables	1.0	-	-	58.0	-	59.0
Assets included in capital employed	3,882.0	3,597.9	756.6	441.6	-41.1	8,636.9

Unallocated items
Deferred tax assets						20.0
Cash and cash equivalents						166.2
Total assets	3,882.0	3,597.9	756.6	441.6	-41.1	8,823.1

Trade payables	536.7	769.3	62.6	20.3	-0.7	1,388.3
Other non-interest-bearing liabilities	321.5	317.6	131.5	54.0	-18.2	806.5
Provisions	0.3	6.4	11.6	0.5	-	18.8
Liabilities included in capital employed	858.5	1,093.3	205.7	74.9	-18.9	2,213.5

Unallocated items
Interest-bearing liabilities						1,474.6
Lease liabilities						2,098.0
Other non-interest-bearing liabilities						108.7
Deferred tax liabilities						101.6
Total liabilities	858.5	1,093.3	205.7	74.9	-18.9	5,996.4

Total capital employed as at 31 December	3,023.5	2,504.6	550.9	366.7	-22.2	6,423.4
Average capital employed	2,974.7	2,430.6	536.7	371.8	-6.2	6,307.7
Return on capital employed, %, comparable	14.1	7.3	15.5	-	-	10.4

Number of personnel as at 31 December	8,143	8,075	1,809	964		18,991
Average number of personnel converted into full-time employees	6,264	6,853	1,638	911		15,665


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Segment information 2024

Profit


€ million	Grocery trade	Building and technical trade	Car trade	Common functions	Total
Division net sales	6,381.4	4,351.6	1,209.4	1.5	11,943.9
of which intersegment sales	-16.1	0.2	-7.3	-0.7	-23.9
Net sales from external customers	6,365.3	4,351.8	1,202.1	0.8	11,920.1

Change in net sales in local currency excluding acquisitions and disposals, %	0.4	-6.0	-4.0	-	-2.3
Change in net sales, %	0.5	3.8	-4.2	-	1.2

Other division income	813.0	144.1	29.0	12.7	998.7
of which intersegment income	-0.9	-2.0	0.1	-1.3	-4.1
Other operating income from external customers	812.0	142.1	29.1	11.3	994.6

Depreciation and amortisation	-108.6	-76.9	-31.4	-31.0	-247.9
Depreciation and impairment charges for right-of-use assets	-243.9	-100.8	-24.2	-6.6	-375.5
Share of result of joint ventures	-	20.9	-	-	20.9
Operating profit	420.9	116.3	69.3	-26.9	579.5

Items affecting comparability	-17.2	-52.8	-0.0	-0.5	-70.6
Comparable operating profit	438.0	169.1	69.3	-26.4	650.1

Finance income and costs					-111.7
Share of result of associates					3.8
Profit before tax					471.5


		130

Assets and liabilities


€ million	Grocery trade	Building and technical trade	Car trade	Common functions	Eliminations	Total
Property, plant, equipment and intangible assets	1,697.0	1,215.9	286.5	82.4	-1.3	3,280.5
Right-of-use assets	1,258.9	472.3	78.6	57.9	-	1,867.7
Interests in associates and joint ventures and other investments	6.2	160.8	0.1	88.1	-0.6	254.5
Pension assets	18.6	5.0	-	103.8	-	127.5
Inventories	285.8	586.0	229.7	-	-	1,101.5
Trade receivables	363.5	524.1	71.1	2.1	-2.9	957.9
Other non-interest-bearing receivables	71.5	197.5	24.2	45.5	-31.5	307.2
Interest-bearing receivables	1.1	-	-	61.9	-	63.0
Non-current assets classified as held for sale	-	6.6	-	0.0	-	6.6
Assets included in capital employed	3,702.7	3,168.1	690.1	441.7	-36.3	7,966.3

Unallocated items
Deferred tax assets						16.9
Other financial assets						15.0
Cash and cash equivalents						473.1
Total assets	3,702.7	3,168.1	690.1	441.7	-36.3	8,471.2

Trade payables	603.4	736.3	52.3	14.6	-2.2	1,404.4
Other non-interest-bearing liabilities	312.6	269.7	113.4	45.5	-22.7	718.5
Provisions	1.1	5.2	12.6	0.5	-	19.5
Liabilities related to non-current assets classified as held for sale	-	0.1	-	-	-	0.1
Liabilities included in capital employed	917.1	1,011.4	178.3	60.6	-24.9	2,142.4

Unallocated items
Interest-bearing liabilities						1,345.3
Lease liabilities						2,051.0
Other non-interest-bearing liabilities						121.3
Deferred tax liabilities						76.3
Total liabilities	917.1	1,011.4	178.3	60.6	-24.9	5,736.3

Total capital employed as at 31 December	2,785.6	2,156.7	511.8	381.1	-11.4	5,823.8
Average capital employed	2,734.9	2,172.8	503.0	350.7	-2.7	5,758.7
Return on capital employed, %, comparable	16.0	7.8	13.8	-	-	11.3

Number of personnel as at 31 December	8,257	7,341	1,752	959		18,309
Average number of personnel converted into full-time employees	6,346	6,538	1,556	908		15,347


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Alternative performance measures in segment reporting