LHV Group AS

The responsibility for considering principal adverse impacts is allocated internally as follows: The Supervisory Board of LHV Group AS approves the overall ESG policy of the Group. The Management Board of LHV Pank AS approves the "Responsible Investment Policy". The Head of Private Banking at LHV approves the "LHV Pank AS Engagement Policy in Securities Portfolio Management", and the LHV Portfolio Manager exercises voting rights. LHV portfolio managers are responsible for selecting the additional indicators of principal adverse impacts and ensuring that impacts are identified. These documents undergo annual review and assessment for potential amendments. [...] Regarding the exercise of voting rights in investments, sustainability issues are considered in line with the [LHV Pank AS Engagement Policy in Securities](http://www.lhv.ee/assets/files/AS_LHV_Pank_kaasamispoliitika_vaartpaberiportfelli_valitsemisel-EN.pdf) [Portfolio Management. By exercising voting rights, LHV promotes better corporate governance and corporate responsibility and influences companies to](http://www.lhv.ee/assets/files/AS_LHV_Pank_kaasamispoliitika_vaartpaberiportfelli_valitsemisel-EN.pdf) increase transparency and disclosure of information. Using voting rights is one of the ways to promote the principles of sustainability outlined in the engagement policy (ESG principles in exercising voting rights in typical situations).

During 2022, the AML screening and monitoring software developed and supported by OÜ Salv Technology was fully implemented, lastly, taking over Estonian customer base transaction monitoring and risk scoring. [...] In addition to the investments in IT systems, the number of employees directly and indirectly involved in AML has significantly increased. New positions were created in both the AML Compliance Department and the business units' AML functions, respectively.

The internal responsibility regarding consideration of principal adverse impacts of investment decisions is allocated as follows. The Supervisory Board of AS LHV Group approves the group's ESG Policy. The Management Board of AS LHV Pank approves the Responsible Investment Policy. LHV Pank AS Engagement Policy in Securities Portfolio Management is approved by the Head of Private Banking at LHV and voting rights are exercised by LHV portfolio manager. LHV portfolio managers are responsible for the selection of the additional principal adverse indicators and for ensuring that the impacts are identified. These documents undergo annual review and assessment for potential amendments.