Interfor : Sustainability Report

Interfor's company-wide approach to sustainability is based on a broad appreciation for what it takes for our Company, and our society, to deliver on the needs of today without compromising our future.

IAN FILLINGER

President and CEO

2023

SUSTAINABILITY REPORT

Building value through sound environmental, social and governance practices

• INTRODUCTION
  CEO Message
  VP, Woodlands &
  Chief Forester Message Building Value Sustainably
• SAFETY
  Programs & Certification Key Metrics Contractor Safety
• PEOPLE
  Employee Development Diversity, Equity & Inclusion Recruitment & Culture Indigenous Peoples Communities Customers
• C LIMATE & ENVIRONMENT
  Climate Change Forest Values Environmental Management Sustainable Products Infrastructure & Technology
• GOVERNANCE
• REFERENCES & METHODOLOGY
• APPENDICES

Explore the work Interfor is doing to create a safer, more sustainable and equitable future for all.

3	INTRODUCTION	19	PEOPLE
3	CEO Message	21	Employee Development
4	VP, Woodlands &	25	Diversity, Equity & Inclusion
	Chief Forester Message	29	Recruitment & Culture
5	Building Value Sustainably	33	Indigenous Peoples
11	SAFETY	40	Communities
13	Programs & Certification	45	Customers
15	Key Metrics
18	Contractor Safety

1. CLIMATE & ENVIRONMENT
2. Climate Change

1. Forest Values

1. Environmental Management

1. Sustainable Products

1. Infrastructure & Technology

85 GOVERNANCE

89 REFERENCES & METHODOLOGY

97 APPENDICES

INTRODUCTION

2023 SUSTAINABILITYTERFOR REPORT

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• INTRODUCTION
  CEO Message
  VP, Woodlands &
  Chief Forester Message Building Value Sustainably
• SAFETY
  Programs & Certification Key Metrics Contractor Safety
• PEOPLE
  Employee Development Diversity, Equity & Inclusion Recruitment & Culture Indigenous Peoples Communities Customers
• C LIMATE & ENVIRONMENT
  Climate Change Forest Values Environmental Management Sustainable Products Infrastructure & Technology
• GOVERNANCE
• REFERENCES & METHODOLOGY
• APPENDICES

IAN FILLINGER

President and CEO

Message from the President & CEO

As a manufacturing company that relies on a renewable natural resource, Interfor's performance against sustainability criteria is one of the most important signals of the health and success of our Company. Interfor's 2023 Sustainability Report shows a company that is delivering on our commitment to embrace world-leading practices to advance renewable forest products as part of the climate solution.

Our sustainability goals are aligned with Interfor's values, and how we manage our company:

Our highest priority in all we do is safety. This year we achieved our best safety performance ever, with a record low medical incident rate (MIR) across the Company and continued expansion of our safety metrics to our recently acquired operations. While we still have work to do, this year we showed significant progress toward our goal of zero injuries and everyone returning home safely.

Our commitment to our people goes beyond safety,

and includes our goal to develop a workforce that reflects the diversity and strengths of our communities. In 2023, we continued to build, grow and offer high-quality learning and development opportunities throughout our workforce, with our employees completing more than 30,000 hours of learning.

This year we also completed a company-wide diversity audit of our operations and a voluntary diversity survey to better understand our employees' experiences as they relate to diversity. We will use the results to develop action plans to address the unique challenges in each of our regions.

Progress on climate and environment remains a fundamental priority for Interfor. As a company we are taking action to reduce our footprint, through efficiency improvements and targets to reduce our emissions, waste and water consumption. This past year clearly demonstrated the importance of action in this area, and its relevance to our business and our communities. Wildfire activity was particularly intense in 2023, threatening not only the forests we rely on, but also our mills and the places we call home. I am exceptionally proud of our employees, our contractors, and the government firefighters who worked tirelessly to save the Adams Lake sawmill in BC.

Ultimately, the work we are doing to enhance our sustainability is all about strengthening the future of our Company and the resilience of our communities. In the actions we are taking across the Company, both small and large, our team is continuing to demonstrate a responsible approach to manufacturing a sustainable product in a way that aligns with broad societal objectives. We look forward to building on our momentum as we go forward.

Thank you for reading.

Ian Fillinger

President and CEO

March 21, 2024

INTRODUCTION

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Message from Vice President, Woodlands & Chief Forester

• INTRODUCTION
  CEO Message
  VP, Woodlands & Chief Forester Message
  Building Value Sustainably
• SAFETY
  Programs & Certification Key Metrics Contractor Safety
• PEOPLE
  Employee Development Diversity, Equity & Inclusion Recruitment & Culture Indigenous Peoples Communities Customers
• C LIMATE & ENVIRONMENT
  Climate Change Forest Values Environmental Management Sustainable Products Infrastructure & Technology
• GOVERNANCE
• REFERENCES & METHODOLOGY
• APPENDICES

STUART CARD

Vice President, Woodlands & Chief Forester

At Interfor sustainability is something we work toward every day. "Building Value Sustainably" anchors our business strategy, and sustainability principles have always been part of our core Interfor values of safety, operational excellence, and continuous improvement. Our people contribute to our sustainability performance by living the Interfor culture every day.

After releasing our Sustainability Strategy last year, our focus turned to developing and executing on action plans that will make sustainability a more intentional part of every area of our business. This Sustainability Report marks notable progress toward our goals and targets.

Highlights of this year's report include:

• Expanding of our safety culture and programs to our newly acquired operations.
• Enhancing safety data collection and reporting.
• Completing a company-wide diversity audit and voluntary employee diversity survey.

• Advancing our Board of Directors diversity target by a year.
• Implementing pilot projects to reduce waste and water use at several of our mills, resulting in the establishment of nine individual targets.
• Investing in a host of process and technology innovations across the Company that contribute to emissions reduction and more efficient use of our resources.

We know that sustainability requires continual effort towards achieving our sustainability goals. In 2023, we continued to engage with employees and stakeholders to raise awareness and gather feedback that we will incorporate into our approach to sustainability.

I am excited to share our 2023 report with you and hope you enjoy reading it.

Stuart Card

Vice President, Woodlands & Chief Forester

March 21, 2024

INTRODUCTION

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>	INTRODUCTION
	CEO Message
	VP, Woodlands &
	Chief Forester Message
	Building Value Sustainably
>	SAFETY
	Programs & Certification
	Key Metrics
	Contractor Safety
>	PEOPLE
	Employee Development
	Diversity, Equity & Inclusion
	Recruitment & Culture
	Indigenous Peoples

Interfor Operations and Production Capacity - 2023

BC INTERIOR	EASTERN CANADA
3 SAWMILLS /750 MMBF	7 SAWMILLS /985 MMBF
1 REMANUFACTURING FACILITY (SUMAS, WA)	1 I-JOIST PLANT
	1 REMANUFACTURING FACILITY
	ATLANTIC CANADA
	2 SAWMILLS/350 MMBF
US NORTHWEST
4 SAWMILLS /770 MMBF	US SOUTH
	13 SAWMILLS /2,335 MMBF

INTRODUCTION

	Communities
	Customers
>	C LIMATE &
	ENVIRONMENT
	Climate Change
	Forest Values
	Environmental Management
	Sustainable Products
	Infrastructure & Technology
>	GOVERNANCE
>	REFERENCES &
	METHODOLOGY
>	APPENDICES

Interfor is one of the world's largest lumber producers, with well-positioned facilities across all major timber-producing regions of North America.

We have solidified our reputation as a supplier of high-quality lumber, offering a diverse line of products in markets around the world. We have a history of investing in our people and operations-between 2010 and 2023, we invested more than $3 billion

to upgrade our facilities and grow our annual production capacity. Our success is driven by our vision to be the most profitable, valuable and respected forest products company in the world. We know that to achieve this, we must provide our customers with quality products and service. We must invest in people and provide safe, stable and good-paying jobs that support local economies.

Finally, we must conduct ourselves and our business with honesty and

integrity and be committed

to continuous improvement from the forests to our mills.

Building value sustainably is an ongoing effort that requires day-to-day decisions and actions that enhance the value of the products we produce, strengthen the relationships we build, and protect the environments in which we operate.

Decades of Success

In 2023, Interfor proudly marked not just one, but two significant milestones that are symbolic of our commitment to growth, sustainability, and the pursuit of excellence. As we reflect

on our remarkable journey, we celebrated 60 years of Interfor's dedication to innovation and quality in the lumber industry, and a decade since we expanded into the US South.

2023 SUSTAINABILITYTERFOR REPORT

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• INTRODUCTION
  CEO Message
  VP, Woodlands &
  Chief Forester Message Building Value Sustainably
• SAFETY
  Programs & Certification Key Metrics Contractor Safety
• PEOPLE
  Employee Development Diversity, Equity & Inclusion Recruitment & Culture Indigenous Peoples Communities Customers
• C LIMATE & ENVIRONMENT
  Climate Change Forest Values Environmental Management Sustainable Products Infrastructure & Technology
• GOVERNANCE
• REFERENCES & METHODOLOGY
• APPENDICES

Respecting Nature. Building Sustainably.

A Sustainability Strategy to Match our Growth Ambition

As we continue to execute on a long-standing strategy of purposeful growth and geographic lumber diversification, we are committed

to growing in a way that makes the world a better place. Our company-wide Sustainability Strategy defines a path that includes both aspirational goals and near-term targets to support this commitment. Our vision is to elevate a culture of sustainability excellence throughout our Company by continuing

to embrace world-leading standards and relevant targets.

Our Purpose

Embracing world-leading sustainability practices to advance renewable wood products as part of the climate solution.

OUR GOALS

SAFETY	Our goal is that everyone
	returns home safely.
PEOPLE	Our goal is to develop a
	workforce that reflects the
	diversity and strengths
	of our communities.
CLIMATE &	Our goal is to have a
ENVIRONMENT	positive influence on the
	climate and environment.

INTRODUCTION

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• INTRODUCTION
  CEO Message
  VP, Woodlands &
  Chief Forester Message Building Value Sustainably
• SAFETY
  Programs & Certification Key Metrics Contractor Safety
• PEOPLE
  Employee Development Diversity, Equity & Inclusion Recruitment & Culture Indigenous Peoples Communities Customers
• C LIMATE & ENVIRONMENT
  Climate Change Forest Values Environmental Management Sustainable Products Infrastructure & Technology
• GOVERNANCE
• REFERENCES & METHODOLOGY
• APPENDICES

OUR TARGETS

SAFETY

Reduce our medical incident rate (MIR) by 3% every year, leading to an MIR of <1.5 by the end of 2030.

Zero serious injuries.

For progress updates on our safety targets see Key Metrics.

Target

Review

We have established a regular sustainability strategy review process. Under this process we review our targets every three years, and set new targets as needed. Our next sustainability strategy review is scheduled for 2025.

PEOPLE

30% of our Board of Directors will be women by our 2024 AGM.

By the end of 2025:

40% of employees in leadership and development programs will be from an under-represented group;*

15% of our supervisors and superintendents will be women;

30% of our hourly trades/ skilled workforce will be from an under-represented group; and

15% of our hourly workforce will be women.

We completed an audit of our diversity practices in 2023.

• Under-representedgroups include women, ethnic and racial minorities, and Indigenous Peoples.

For progress updates on our diversity targets see Diversity, Equity & Inclusion.

CLIMATE &

ENVIRONMENT

Reduce our Scope 1 and 2 greenhouse gas (GHG) emissions by 40% by the end of 2030, using 2021 as our baseline year.

Continue to refine our Scope 3 emissions inventory and complete external verification of our GHG inventories for our 2023 reporting.

Achieve water and waste reduction targets set for 2024 (see page 73 for details).

Implement Biodiversity Interface Management Plans at 100% of our sawmill facilities by the end of 2024.

Maintain third-party internationally recognized sustainable forest management certification and chain-of- custody certification for 100% of our woodlands and sawmills, respectively.

For progress updates on our climate and environment targets see Climate Change, Forest Values and Environmental Management.

Sustainability Pillars

In addition to our sustainability goals and targets, the following foundational pillars are part of the Interfor Way and integral to our approach to sustainability:

Supporting local communities We work both locally and through a partnership

with Habitat for Humanity International to elevate our impact in communities.

See Communities for more information.

Investing in our operations We continue to deliver on a multi-yearstrategic capital investment program, with the completion of several major projects in 2023. See Infrastructure & Technology for more information.

Leading with strong governance practices

We continue to lead with strong governance practices, promoting the long-term interests of our stakeholders, ensuring that we operate sustainably, and building public trust in our Company. See Governance for more information.

INTRODUCTION

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• INTRODUCTION
  CEO Message
  VP, Woodlands &
  Chief Forester Message Building Value Sustainably
• SAFETY
  Programs & Certification Key Metrics Contractor Safety
• PEOPLE
  Employee Development Diversity, Equity & Inclusion Recruitment & Culture Indigenous Peoples Communities Customers
• C LIMATE & ENVIRONMENT
  Climate Change Forest Values Environmental Management Sustainable Products Infrastructure & Technology
• GOVERNANCE
• REFERENCES & METHODOLOGY
• APPENDICES

We use strategic employee and stakeholder engagement to guide our sustainability initiatives and drive their success.

Meaningful and Authentic Engagement

Authenticity is the touchstone of our sustainability strategy-we believe it is a critical factor for success.

This is why we seek to inform our strategy with honest answers from our executives, our employees, and our stakeholders about what they care about and what matters most to them. In 2023, we conducted a number of engagement initiatives and will continue to incorporate the feedback we received into our sustainability approach.

Employee Feedback

In 2023, as part of our focus on raising employee awareness about sustainability and aligning our initiatives with the matters most important to our employees, we conducted the following engagement and outreach:

• Live sustainability information sessions hosted by our VP of Woodlands & Chief Forester;
• A "Sustainability Is..." campaign to foster engagement and solicit ideas, especially from our hourly employees;
• A Sustainability Intranet site to share updates, resources and collect ideas from employees; and
• A voluntary and anonymous Diversity Survey across our entire workforce (See Recruitment & Culture for more details).

Stakeholder Feedback

In addition to the engagement and feedback we solicited from employees in 2023, we also engaged with external stakeholders seeking to understand their perspectives and priorities on sustainability topics. We maintain a sustainability communications plan and will continue to enhance our dialogue with investors, analysts, customers, and communities as part of our Sustainability Strategy. Ongoing dialogue and feedback will continue to be part of a continuous review and improvement process for our strategy. Our external communications include broad corporate engagement and local-level conversations. Examples from 2023 include:

• An in-depth investor perception survey, which included questions specific to sustainability;
• Mill tours hosted for leaders
  and local government officials; and
• Operational teams participation in local forums and working tables (See Communities for more details).

INTRODUCTION

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>	INTRODUCTION
	CEO Message
	VP, Woodlands &
	Chief Forester Message
	Building Value Sustainably
>	SAFETY
	Programs & Certification
	Key Metrics
	Contractor Safety
>	PEOPLE
	Employee Development
	Diversity, Equity & Inclusion
	Recruitment & Culture
	Indigenous Peoples
	Communities
	Customers
>	C LIMATE &
	ENVIRONMENT

Supporting the United		As one of the world's largest forest products companies with operations across North
Nations Sustainable		America and customers around the globe, we can make a significant contribution to
Development Goals		sustainable development. Our holistic approach to sustainable development, including
(SDGs)		how we support and contribute to each of the 17 SDGs, can be found in Appendix I.

Sustainable Development Goals Most Relevant to our Business

	Promote sustained, inclusive and sustainable	We employed approximately 5,300 people in 2023 and have demonstrated our ability to grow and
	economic growth, full and productive	build value sustainably for our employees, our shareholders and our communities. Our partnerships and
	employment and decent work for all	agreements with Indigenous nations support economic growth and employment in their communities.
	Build resilient infrastructure, promote	Over the last decade, we have spent, on average, more than $148 million each year upgrading facilities
	inclusive and sustainable industrialization	and systems to employ the latest technology, improving our operational efficiency, lumber recovery,
	and foster innovation	and environmental and safety performance. We also invest in and deploy new technology
		in our woodlands operations, leading to improved forest management and logging practices.
	Ensure sustainable consumption	We are committed to responsible log sourcing and sustainable harvest levels to ensure environmental,
	and production patterns	economic and social opportunities for current and future generations. We optimize material use in our
		manufacturing process by using or selling wood residuals for renewable energy or upcycling into other
		products. We continue to increase the level of disclosure provided in our annual sustainability reporting,
		including metrics and targets.

INTRODUCTION

2023 SUSTAI

Climate Change

Forest Values

Environmental Management

Sustainable Products

Infrastructure & Technology

> GOVERNANCE

Take urgent action to combat climate change and its impacts

We have set a target to reduce our Scope 1 and 2 greenhouse gas emissions by 40% by the end of 2030, using 2021 as our baseline year. Our sustainable forest management practices can increase and extend the carbon storage capacity of forests. Carbon is stored in the long-lived wood products that we produce, and we supply climate-friendly building products to our customers. We have replaced fossil fuels with renewable biomass energy in many of our kilns, and we have participated in wildfire fuel reduction projects to reduce climate-related wildfire risks and improve forest resiliency.

NTERFORABILITY REPORT

>	REFERENCES &
	METHODOLOGY
>	APPENDICES

Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss

100% of the forested land managed by Interfor is certified to the internationally recognized third- party Sustainable Forestry Initiative® (SFI) standard. We conduct prompt reforestation with a mix of tree species that are native and ecologically suited to each site. We contribute to the conservation of biodiversity through the identification and establishment of ecological reserves, and we support management and recovery initiatives for species at risk.

9

• INTRODUCTION
  CEO Message
  VP, Woodlands &
  Chief Forester Message Building Value Sustainably
• SAFETY
  Programs & Certification Key Metrics Contractor Safety
• PEOPLE
  Employee Development Diversity, Equity & Inclusion Recruitment & Culture Indigenous Peoples Communities Customers
• C LIMATE & ENVIRONMENT
  Climate Change Forest Values Environmental Management Sustainable Products Infrastructure & Technology
• GOVERNANCE
• REFERENCES & METHODOLOGY

As a growth-oriented company, we

> APPENDICESare committed to growing in a way that makes the world a better place and we have a vision to elevate a culture of sustainability excellence throughout our Company.

Sustainable Growth

The story of our Company's transformation over the past decade includes the significant growth through acquisitions as well as the investments we've made to increase efficiency and capacity in our existing facilities. Responsible growth includes embracing world-leading safety and environmental standards, and establishing a consistent culture and approach across our operations.

Lumber Production Volumes (MMBF)
4,500
4,000					4,134
3,500					3,792
3,000
2,500					2,891
2,497	2,490	2,595	2,635	2,646
2,000			2,377
2,222
1,500
1,000
500
0

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Capital Investments in Existing Facilities ($MM)

$350

$300								$305
$200									$199
$150					$181		$177
				$139
$100	$121					$110
			$95
$78		$77
$50
$0
2014	2015	2016	2017	2018	2019	2020	2021	2022	2023

INTRODUCTION

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