Scatec : Corporate Governance Report 2023

Corporate Governance Report

Scatec ASA

Adopted by the

Board of Directors 19 March 2024

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Scatec ASA (Scatec or the Company) has made a strong commitment to ensure trust in the Company and to enhance shareholder value through effective decision-making and transparent communication between the management, the Board of Directors and the shareholders. This report is prepared by the Board of Directors to present the Company's corporate governance structure.

The Company complies with the Norwegian Code of Practice for Corporate Governance (the Code of Practice) (available at the Norwegian Corporate Governance Committee's website, www.nues.no) based on the "comply or explain" principle. This report is structured to cover all sections of the Code of Practice and any deviations between the Company's corporate governance and the Code of Practice will be discussed under the relevant section of the report.

1. Implementation and reporting on corporate governance

The Board of Directors is responsible for ensuring that the Company conducts its business using sound corporate governance and to ensure that the Company's standards for corporate governance reflect the Code of Practice.

The principal purpose of the Code of Practice is to ensure (i) that listed companies implement corporate governance practices that regulates the division of responsibilities between the shareholders, the Board of Directors and Executive Management more comprehensively than the legislation requires, and (ii) effective management and control over activities with the aim of securing the greatest possible value creation over time in the best interest of shareholders, employees and other stakeholders. The Company's framework for corporate governance is intended to fulfil this purpose and thereby decrease business risk, maximise value and utilise the Company's resources in an efficient, sustainable manner, to the benefit of shareholders, employees and society at large.

The overall responsibility for the Company's corporate governance rests with the board, and is implemented through the Board of Directors, the Audit and Sustainability Committee and the Organisation and Remuneration Committee.

Scatec's values constitute a key premise for the Company's corporate governance. The key values of the Company are: predictable, driving results, changemakers and working together. These values aim to characterise the behaviour of the Company and the Company's employees and form the basis for the Company's ethical guidelines. The Board of Directors has adopted overarching guidelines for corporate governance, including rules of procedure for the Board of Directors, instructions for the Audit and Sustainability Committee and the Organisation and Remuneration Committee respectively, insider manuals, manual on disclosure of information, ethical guidelines and guidelines for corporate social responsibility. The corporate governance framework of the Company is subject to annual reviews and discussions by the Board of Directors.

The Company is subject to the reporting requirements for corporate governance under the Accounting Act section 3-3b and the Euronext Oslo Rule Book II section 4.4, available at www. lovdata.noand www.oslobors.norespectively.

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2. Business

The Company is a leading renewable energy solution provider, accelerating access to reliable and affordable clean energy in emerging markets. As a long-term player, the Company and its subsidiaries develop, build, own and operate renewable energy plants, with 4.2 GW in operations and under construction across four continents today. Additionally, Scatec started construction of 0.3 GW in the first quarter 2024.

The Company's business is defined in the Company's articles of association (the "Articles of Association") section 3:

"The company's business is establishment and operation of business within renewable energy, hereunder investment in companies operating such business."

The Company has adopted and implemented guidelines to ensure it creates value for its shareholders in a sustainable manner into its business and value creation for its shareholders through its sustainability framework and reporting.

The Company's objectives, principal strategies and stakeholder engagement are further described in the Company's annual report, sustainability report and on the Company's website www.scatec.com.

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3. Equity and dividends

Capital Structure

The Board of Director's continuously evaluate the capital structure, including equity and liquidity.

At 31 December 2023, the Company's consolidated equity was NOK 10,570 million, which is equivalent to 25% of total assets. The Board of Directors considers this equity level to be satisfactory. The Company's capital structure is continuously considered in light of its objectives, strategy and risk profile. For further description of financial risks, please see the Company's annual report.

Dividend policy

All shares in the Company have equal rights to dividends.

The Company reported to the market in its financial report for Q4 2022 that "the dividend will be assessed annually by the board based on the Company's capital situation".

The Board of Directors have assessed the macro-economic factors, funding alternatives and capital situation of the Company and determined in Q3 2023 that it would be in the best interest of the Company and its shareholders to amend the Company's dividend policy so the expected distribution percentage shall be reduced from 15% to 0%.

The dividend policy will continue to be assessed on an annual basis.

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Capital increases and issuance of shares

The Board is currently, and until the General Meeting of 2024, but in no event later than 30 June 2024, authorised by the General Meeting to resolve an increase in the Company's share capital, in one or more rounds, by a total of NOK 446,965 through two separate authorisations:

1. One authorisation which allows for increase in the share capital by a total of up to NOK 397,293. The authorisation was granted by the Annual General Meeting held 18 April 2023 and may be used for the purpose of strengthening the Company's equity and issuing shares as consideration in connection with acquisitions of businesses within the Company's purpose. As per the date of this document, the authorisation mentioned in i) above has not been used.
2. A second authorisation which allows for increase in the share capital by a total of up to NOK 49,672. This authorisation was granted by the Annual General Meeting 18 April 2023 and may be used for issuing of shares in connection with the Company's incentive schemes. As per the date of this document, the authorisation mentioned in ii) above has not been used.

Trading in own shares

The Board is currently, and until the Annual General Meeting of 2024, but in no event later than 30 June 2024, authorised by the General Meeting to, in one or more rounds, acquire shares with a total nominal value of up to NOK 844,258 through three separate authorisations:

1. One authorisation which allows for purchase of shares with a nominal value of up to NOK 397,293. Shares acquired pursuant to this authorisation shall be used in connection with acquisitions, mergers, de-mergers or other transactions.
2. A second authorisation which allows for purchase of shares with a nominal value of up to NOK 397,293. Shares acquired pursuant to this authorisation shall be used for investment purposes or for subsequent sale or deletion of the shares.
3. A third authorisation which allows for purchase up to 1,986,910 own shares in the company, in one or more rounds, up to an aggregate nominal value of NOK 49,672. Shares acquired pursuant to this authorisation shall be utilised for incentive schemes.

The authorisations to acquire own share are in line with the Company's Corporate Governance policy. None of the authorisations have been used as of the date this document was adopted.

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4. Equal treatment of shareholders

Pre-emption rights to subscribe

According to the Norwegian Public Limited Liability Companies Act, the Company's shareholders have pre-emption rights in share offerings against cash contribution. Such pre-emption rights may however be set aside, either by the General Meeting or by the Board of Directors if the General Meeting has granted a Board authorisation which allows for this. Any resolution proposed by the Board to set aside pre-emption rights will be in the common interests of the Company and the shareholders, and the basis for such deviation will be publicly disclosed through a stock exchange notice from the Company.

Trading in own shares

In the event of a future share buy-back programme, the Board of Directors shall ensure that all transactions pursuant to such programme will be carried out either through the trading system at Oslo Børs or at prevailing prices at Oslo Børs. In the event of such programme, the Board of Directors will take the Company's and shareholders' interests into consideration and maintain transparency and equal treatment of all shareholders. If there is limited liquidity in the Company's shares, the Company shall consider other ways to ensure equal treatment of all shareholders.

Guidelines for directors and Executive Management

The Board of Directors has adopted rules of procedures for the Board of Directors which inter alia includes guidelines for notification by members of the Board of Directors and Executive Management if they have any material direct or indirect interest in any transaction entered into by the Company.

5. Shares and negotiability

The Company has one class of shares, and all shares carry equal rights in the Company. There are no limitations on a party's ability to own, trade or vote for shares in the Company.

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6. General meetings

The Board of Directors will make its best efforts to ensure that the Company's shareholders can participate in the General Meeting. The General Meeting is held digitally, and any shareholder who is not able to participate on the day of the meeting can be represented by proxy or vote in advance.

Notification

The Board of Directors will seek to ensure that the resolutions and supporting information distributed are sufficiently detailed and precise to allow shareholders to form a view on all matters to be considered at the meeting.

Participation and execution

In accordance with the Norwegian Public Liability Companies Act, the Company's Articles of Association requires shareholders to give notice to the Company of their participation at General Meetings within five days prior to the General Meeting.

The Company will aim to prepare and facilitate the use of proxy forms which allows separate voting instructions to be given for each item on the agenda and nominate a person who will be available to vote on behalf of shareholders as their proxy.

To the extent deemed appropriate or necessary, the Board of Directors will seek to arrange for the General Meeting to vote separately on each candidate nominated for election to the Company's corporate bodies.

Explanation for deviation from the Code of Practice in regard to recommendation that all Directors should attend the AGM: It is the intention of the Company that the Chair of the Board shall be present at General Meetings. The Company will however, normally not have all Directors attend as the Company believes this is unnecessary. The Chair is represented in all the Board committees and is considered qualified to answers any questions directed to the Board.

Explanation for deviation from the Code of Practice regarding the recommendation on separate voting on each candidate to the Company's corporate bodies: In 2023, the voting on members to the nomination committee took place as a combined vote to ensure combined expertise and to comply with the nomination committee's overall recommendation.

The auditor will attend the ordinary General Meeting and any extraordinary General Meetings to the extent required by the agenda items or other relevant circumstances.

External legal counsel will be chairing the General Meetings.

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7. Nomination Committee

The Nomination Committee is governed by the Articles of Association section 8 and preforms its responsibilities in accordance with the instructions for the Nomination Committee as adopted by the General Meeting. The Nomination Committee consist of two to four members who shall be shareholders or shareholder representatives. The members are elected by the General Meeting for a term of one or two years and can be re-elected. The Nomination Committee gives recommendations to the General Meeting regarding election of members to the Board of Directors and Nomination Committee, and their compensation. The basis for the proposal(s) for each candidate shall be disclosed.

The current members of the Nomination Committee are:

• Kristine Ryssdal (Chair) until 2024
• Mads Holm until 2025
• Annie Golden Bersagel until 2025
• Christian Rom until 2025

Their profiles are available atwww.scatec.com/investor.

All shareholders are welcome to propose candidates for election on the Company's website, www. scatec.com/investor.

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8. Board of Directors: composition and independence

Pursuant to the Articles of Association section 7, the Company's Board of Directors shall consist of three to seven members. The term of office for members of the Board of Directors is two years at a time, with the possibility for re-election.

The Board of Directors currently consists of the following five members:

• John Andersen (Chair) until 2024
• Maria Moræus Hanssen until 2024
• Mette Krogsrud until 2024
• Espen Gundersen until 2024
• Gisele Marchand until 2025
• Jørgen Kildahl until 2025
• Morten Henriksen until 2025

The Chair of the Board is elected by the General Meeting.

All members of the Board of Directors are considered independent of the Company's Executive Management and material business contracts. Furthermore, Maria Moræus Hanssen, Gisele Marchand, Jørgen Kildahl, Espen Gundersen, Mette Krogsrud and Morten Henriksen are all considered independent of the Company's main shareholders. The Board of Directors does not include executive personnel.

Diversity is a business imperative in the Company. Building a culture that nurtures diversity in all aspects is key to delivering on our goals and foster innovation - key to be changemakers, and the Company aspires diversity in all parts of the organisation, including the Board of Directors. For the Board of Directors, the diversity requirement is implemented in the instructions for the Nomination Committee clause 4.5 a) (ii), which requires the Nomination Committee to ensure that the Board of Directors meets the Company's need for expertise, capacity, and diversity. The Board of Directors currently has 43% female representation and a diverse professional background with respect to both education and working experience. The committees are appointed by the Board of Directors, considering each Director's professional and personal qualities. Currently, the Committees have a range between 25% - 50% female representation.

The Company's annual report provides information to illustrate the expertise of the members of the Board of Directors and their record of attendance at Board meetings, how long they have been members of the Board, as well as identify which members are considered to be independent.

The Directors are encouraged to own shares in the Company, and are required to invest a minimum of 20% of the gross board remuneration to purchase shares in the Company until they own shares of a value corresponding to one year's gross board remuneration. The shares must be retained for as long as the Board member holds the position. Holdings exceeding one year's board remuneration are not subject to this requirement.

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9. The work of the Board of Directors

The rules of procedure for the Board of Directors

The Board of Directors is responsible for the over-all management of the Company and shall supervise the Company's day-to-day management and the Company's activities in general.

The Norwegian Public Limited Liability Companies Act regulates the duties and procedures of the Board of Directors. In addition, the Board of Directors has adopted supplementary rules of procedures, which provides further regulation on inter alia the duties of the Board of Directors and the Chief Executive Officer, the division of work between the Board of Directors and the Chief Executive Officer, the annual plan for the Board of Directors, notices of Board proceedings, administrative procedures, minutes, Board committees, transactions between the Company and the shareholders and confidentiality.

The Board shall produce an annual plan for its work, with particular emphasis on objectives, strategy and implementation. The Chief Executive Officer shall at least once a month, by attendance or in writing, inform the Board of Directors about the Company's activities, position and profit trend.

The Board of Directors shall ensure that members of the Board of Directors and executive personnel make the company aware of any material interests that they may have in items to be considered by the Board of Directors.

The Board of Directors' consideration of material matters in which the Chairman of the Board is, or has been, personally involved, shall be chaired by some other member of the Board.

The Board of Directors shall evaluate its performance and expertise annually and make the evaluation available to the Nomination Committee.

Transactions with close associates

The Board of Directors shall ensure that any material transactions between the Company and shareholders, a shareholder's parent company, members of the Board of Directors, executive personnel or close associates of any such parties are entered into on arms-length terms. For any such transactions which do not require approval by the General Meeting pursuant to the Norwegian Public Limited Liability Companies Act, the Board of Directors shall assess whether a fairness opinion from an independent third party should be obtained. Any such transactions shall be described in the Company's financial statements.