Embracer Group AB

The Chief of Staff, Legal & Governance is responsible for managing and handling the forums where the operative group CEOs and the Extended Management Team meet. The Chief of Staff, Legal & Governance main responsibility is to assist the CEO in bridging the relationship between the operative group CEOs and the Extended Management Team. Within Embracer Group's decentralized business model the operative group CEOs are responsible for the day-to-day management of the operative groups, with support from the Group Executive Management Team and the Extended Management Team. While the business model is decentralized the governance model is implemented from parent company level to ensure a coherent model that aims [...] The Audit and Sustainability Committee's tasks are to monitor the integrity of Embracer Group's financial reporting system, internal controls, Internal Audit, operation procedure and the enterprise risk management framework, recommend to the Board the appointment, removal and remuneration of the statutory auditors (subject to approval at the shareholders' meeting), monitor the independence of the statutory auditors and review the effectiveness of the Internal Audit. The Internal Audit function reports directly to the Audit and Sustainability Committee. Each year, the Audit Committee adopts an Internal Audit plan which is based on risks that have been identified by the Board in the review of commercial, governance, reporting, sustainability and compliance risks. The audit plan is prepared by the Internal Audit function and discussed with the external auditors to enhance the efficiency and quality of regular audit work.

###### SUSTAINABILITY REPORT\n\n# SUSTAINABILITY GOVERNANCE\n\n###### Strong business ethics and a solid governance foundation ensure that Embracer Group is complying with applicable laws and regulations and that Embracer Group's culture, values, and preferred ways of conducting business are communicated and followed throughout the Group. The Parent company has established governing documents and processes for all Group companies and aims to govern the Group.\n\n###### ORGANIZATION At Embracer Group, the sustainability organization is\naligned with our decentralized operating model. The Board\n###### of Directors approves the sustainability strategy, Groupwide goals, and overall ambitions. Implementation occurs\nat the Parent Company and Operative Group levels. Each\n###### Group company has the freedom to formulate its own\ncompany-specific work and initiatives while aligning with\nour values as well as our governance and business ethics\nprocedures.\n###### The Head of Sustainability leads the sustainability team and is responsible for implementing the sustainability strategy, and reports to the Group CFO & Deputy\n###### CEO. The sustainability team works closely with other departments, such as legal, finance, HR, and public\n\n\n###### affairs. The Group Sustainability Manager is responsi- ble for facilitating strategic collaborations, group-wide sustainability projects and data collection and reports to the Head of Sustainability. During the year, the sus- tainability team has given regular reports to the Audit\nand Sustainability Committee and the Board of Directors.\n###### In the Group, the sustainability strategy is executed on a Parent Company level and on an Operative Group level. The Parent Company is responsible for ensuring the implementation of Group policies and facilitating\ncollaboration within the Group. The Chief of Staff, Legal\n& Governance, is responsible for implementing and monitoring of the governance model. Each Operative Group's\nmanagement is responsible for implementation and safeguarding of the governance model. That responsibility lies\n\n\n###### SUSTAINABILITY ORGANIZATION AND GOVERNANCE\n\nBoard of Directors\n\nAudit & Sustainability Committee\n\nChief of Staff, Legal & Governance CEO Dep CEO & CFO\n\n_Support and ensure the implementation_\n\nHead of Sustainability\n\n_of Group policies_\n\n_Ensure that the governance model is_\n_implemented and monitored_ Sustainability Group Manager\n\n\n_Approve the overall goals, strategy_\n_and policies_\n\n_Review of reporting and overall strategy for_\n_sustainability, evaluate risk management with_\n_respect to sustainability_\n\n_Responsible for the sustainability strategy and goals_\n\n_Facilitates strategic collaborations, sustainability_\n_projects and data collection_\n\n_Group wide activities and reporting_\n\n_Knowledge sharing network_\n\n_Representatives from each Operative Group_\n\n\n_Contribute to the sustainability goals and_\n_strategy in their daily operations_\n\n_Report sustainability data to Embracer HQ_\n_(CFO responsible)_\n\n\nAmbassador Group\n\nAMPLIFIER\nTHQ NORDIC PLAION COFFEE STAIN DECA GAMES GEARBOX\nGAME INVEST\n\nCRYSTAL DYNAMICS\nEASYBRAIN ASMODEE DARK HORSE FREEMODE\n– EIDOS\n\n--NEW-PAGE--\n\n_From left to right: Karin Edner Karlsson, Group Sustainability Manager, Ulrica Frykemo, Head of Financial Control._\n_Throughout the past year, the collaboration between Finance and Sustainability departments has deepened significantly, marked by a shared_\n_commitment to compliance requirements and external reporting._\n\n\nin ensuring regional or local procedures are in place for\n###### compliance. The sustainability team works closely with\nall Operative Groups, both via contacts with senior management, through the Ambassador Group, and through\nother forums. The execution of the sustainability strategy\nis adapted to the specific business and market conditions\nfor each Operative Group.\n###### The Audit and Sustainability Committee is a committee under the Board of Directors that contributes to\n\n\n###### the continued development of our sustainability work.\nThe Committee has an advisory role to the Board and is\nresponsible for ensuring the quality of financial and ESG\nreporting and the efficiency of internal controls, audits,\n###### and risk management, as well as the Group's sustainability work. Examples of topics presented to the Board\n###### during FY 2023/24 were the new sustainability goals developed, the process for reporting and integrating sustainability risk in the overall risk analysis, and the\n\n###### ongoing work of strengthening sustainability as a part\nof the overall strategy and targets for Embracer Group.\n\n###### GROUP POLICIES Governing documents and processes developed by the Parent Company ensure that laws, regulations and shared values concerning business ethics are commu- nicated and followed throughout the Group. All Group policies have been developed by management at the Parent Company and subsequently adopted by the Board of Directors of Embracer Group. The work initiated during FY 2021/22 with the launch of an expanded\nGroup policy package has continued during FY 2023/24,\n###### with several new policies being developed, adopted,\nand added to the package, now totaling 17 Group policies. The implementation phase for new policies in the\n###### operative groups consists of dialogues, workshops,\nguidelines, and instructions to ensure the new policies\n###### are implemented in line with the intention. The parent company monitors and evaluates implementation. To\nsecure local implementation and alignment, our policies\nare available in up to 19 languages. The Parent Company\n###### also follows up implementation through the internal\ncontrol framework and has routines in place to receive\n###### confirmation when policies have been implemented. Embracer Group's internal guidelines and instructions\nprovide support and guidance in the integration of the\nGroup policies and processes.\n###### Embracer Group expects everyone in the Group to\nconduct themselves in a professional manner and act in\nline with our Code of Conduct. The Code of Conduct is\nthe foundation for our shared company culture and values and is implemented in 99% of all companies within\n###### the Group. The Code of Conduct is divided into three\nsections: conduct in business, conduct towards employ###### ees and colleagues, and conduct in society. Embracer\nGroup strives for a culture based on trust, long-term and\nembracing differences.\nOur Information Policy is available to all employees,\nand we also have an Insider Q&A, which supplements the\nInsider Policy. Our Anti Corruption Policy has been implemented by 96% of our companies. During 2023/24, we\nhave not had any confirmed incidents of corruption. Our\nTrade Compliance Policy aims to ensure that the Group\n\n\n###### complies with sanctions against regimes and persons. The policy requires all third parties operating in high- risk countries to be screened, and a trade compliance clause must be included in both agreements and EndUser License Agreements (EULA). All operative groups\nhave procedures in place to ensure compliance with the\n###### Trade Compliance Policy. 97% of companies reported\nimplementation is completed, including such as licenses\nfor the Dow Jones screening system to ensure access to\nupdated sanctions lists.\nOperative groups are required to have an appointed\nCompliance Officer, who is the main responsible at the\noperative group level for compliance and monitoring of\nGroup policies.\n\n###### WHISTLEBLOWING SYSTEM Employees and external stakeholders, such as suppli- ers, can anonymously report violations of our Code of Conduct or other policies through a third-party groupwide whistleblowing system. In addition to the existing\nGlobal Group Reporting channel, we have implemented\n16 local reporting channels to ensure that we fulfill our\nobligations according to the Directive EU 2019/1937 of\nthe European Parliament and of the Council on the protection of persons who report breaches of Union Law and\napplicable rules on data protection (\"the Whistleblowing\n###### Directive\") as well as any specific local requirements\nin the EU Member States where we operate. Following\n###### relevant national legislation, the system ensures security, anonymity, and legal protection for users. This year,\n###### the system did not register any messages that were categorized as whistleblower messages. 95% (88%) of\ncompanies within Embracer Group have confirmed that\n###### all employees have knowledge of the whistleblowing system and how to use it. 75% (75%) of the companies\nalso have a local mechanism in place that provides means\nto report any unethical behavior safely and anonymously.

The Audit and Sustainability Committee's tasks are to monitor the integrity of Embracer Group's financial reporting system, internal controls, Internal Audit, operation procedure and the enterprise risk management framework, recommend to the Board the appointment, removal and remuneration of the statutory auditors (subject to approval at the shareholders' meeting), maintain contact with and evaluate the work, qualifications and independence of the external auditor, and review the effectiveness of the Internal Audit. The Internal Audit function reports directly to the Audit and Sustainability Committee. Each year, the Audit and Sustainability Committee adopts an Internal Audit plan which is based on risks that have been identified by the Board in the review of commercial, governance, reporting, sustainability and compliance risks. The audit plan is prepared by the Internal Audit function and discussed with the external auditors to enhance the efficiency and quality of regular audit work.