To all our stakeholders

I am pleased to confirm that FREYR Battery reaffirms its support of the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment and Anti-Corruption.

In this annual Communication on Progress, we describe our actions to continually improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. We also commit to share this information with our stakeholders using our primary channels of communication.

Sincerely yours,

Tom Jensen
CEO of FREYR Battery

FREYR Battery has in the period for this COP started the building of a battery manufacturing pilot plant. There has been no battery production nor delivery to customers in the period. It is therefore early phase work to establish the governance within human rights for FREYR.

In the period we have developed, through stakeholder consultation in Norway, approved by the Board of Directors and published on our websites a Code of Business Conduct and Ethics which states; "FREYR works to conduct its business activities and operations in a manner that promotes protection of people and the environment. We will conduct our business consistently with the fundamental human and labour rights as defined in the United Nations (“UN”) Guiding Principles on Business and Human Rights, the 10 Principles of the UN Global Compact and the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work. FREYR condemns all forms of human rights violations, and expects Employees, business partners and others associated with our business operations to be equally committed to respect human rights. When considering new business partners or when procuring goods and services, we will review any associated human rights issues and consider how to ensure that our operations do not conflict with fundamental human rights principles."

Human Rights are also anchored in our ESG Policy published on our website: Freyr shall at all times respect and protect fundamental human and labour rights as defined in the Universal Declaration of Human Rights and the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work within all business operations. Freyr condemns all forms of human rights violations, and expects its employees, business partners and others associated with our business operations to be equally committed to respect human rights. We can all contribute to eliminating human rights abuses such as child labour, human trafficking and
forced labour. When considering new business partners or when procuring goods and services, Freyr shall review any associated human rights issues and consider how to ensure that its operations do not come into conflict with any of these fundamental human rights principles. Freyr shall continuously monitor and assess any human rights risks related to its business operations. This includes assessments of whether any indigenous or tribal settlements may be adversely impacted
by its operations. Freyr shall use best efforts to bring awareness and training on human and labour rights to its employees, and as appropriate to its business partners.

We have furthermore published on our websites our Supplier Code of Conduct which states: "Suppliers must respect and comply with human and labour rights. Suppliers are expected to implement and maintain a system for identifying, assessing and avoiding or mitigating human and labour rights risks in their own operations and in their supply chain, or have in place specific plans to do so. Suppliers shall respect, and, where appropriate, develop processes to effectively engage in dialogue with stakeholders affected by their operations such as indigenous and tribal people and settlements. Suppliers shall observe strict requirements for the selection of security contractors to avoid human rights risks in countries where security firms are not properly regulated."

As FREYR operations currently is in a low-risk country (Norway) our human rights risk assessment in the period has been focused on our Supply Chain for building of our pilot factory. All of the suppliers to the pilot factory have been assessed to be in low-risk countries for potential human right breaches.

As we move into the building of our Giga factories for battery production (investment decision pending later this year) and we develop a supply chain for producing commercial batteries we will conduct new Human Rights risk assessments of these suppliers.

FREYR Battery is implementing our approved human rights relevant policies by:
- publishing them externally on our web pages
- publishing them in the Management System which is being developed
- all suppliers have to sign our SCoC
- conducting training (mandatory) for all employees on the Code of Business Conduct and Ethics

Freyr Battery has established a grievance mechanism for all employees through an internal anonymous whistle blower channel on our intranet as well as third parties externally through an anonymous whistle blower channel on our webpages. Procedures to handle grievances is established with the Compliance Officer as responsible receiver and the Board of Directors. A policy for protecting whistle blowers is also established and made publicly available.

We are in the process of developing our management system and the requirements in our human rights policies will be implemented in the various relevant working processes in the company such as our Procurement process and Enterprise Risk Process. We are also preparing awareness training for employees on human rights starting with those working in the highest risks areas which will be mainly procurement and raw material sourcing.

As Freyr in the period for this COP have assessed our human rights risks to be low and we have had no grievances nor other findings of human rights breaches, we have not had any activities in following up breaches. We have included in all our supplier contracts so far, the right to information about human rights governance as well as the right to do audits of the supplier on this issue. We are in the process of implementing reporting overviews, software and processes in order for us to be able to capture any issues and be transparent about this as we start developing new supply chains.

FREYR Battery has in the period for this COP started the building of a battery manufacturing pilot plant. There has been no battery production nor delivery to customers in the period. It is therefore early phase work to establish the governance within labour rights for FREYR.

In the period we have developed through stakeholder consultation in Norway, approved by the Board of Directors and published on our websites a Code of Business Conduct and Ethics which states on labour rights; "FREYR works to conduct its business activities and operations in a manner that promotes protection of people and the environment. We will conduct our business consistently with the fundamental human and labour rights as defined in the United Nations (“UN”) Guiding Principles on Business and Human Rights, the 10 Principles of the UN Global Compact and the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work."

Labour Rights are also anchored in our ESG Policy published on our website: Freyr shall at all times respect and protect fundamental human and labour rights as defined in the Universal Declaration of Human Rights and the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work within all business operations. Freyr condemns all forms of human rights violations, and expects its employees, business partners and others associated with our business operations to be equally committed to respect human rights. We can all contribute to eliminating human rights abuses such as child labour, human trafficking and
forced labour. When considering new business partners or when procuring goods and services, Freyr shall review any associated human rights issues and consider how to ensure that its operations do not come into conflict with any of these fundamental human rights principles. ... Freyr shall use best efforts to bring awareness and training on human and labour rights to its employees, and as appropriate to its business partners.

We have developed and implemented our Health and Safety Policy as well as our Employee Compensation and Benefit Policy.

We have furthermore published on our websites our Supplier Code of Conduct which states: "Suppliers must respect and comply with human and labour rights. Suppliers are expected to implement and maintain a system for identifying, assessing and avoiding or mitigating human and labour rights risks in their own operations and in their supply chain, or have in place specific plans to do so."

We are in the process of developing for approval by the Board of Directors a Harassment and Bullying Policy, a Diversity, Equity and Inclusion Policy as well as an Employee Development Policy.

As FREYR operations currently is in a low-risk country (Norway) our labour rights risk assessment in the period has been focused on our Supply Chain for building of our pilot factory. All of the suppliers to the pilot factory have been assessed to be in low-risk countries for potential labour right breaches.

As we move into the building of our Giga factories for battery production (investment decision pending later this year) and we develop a supply chain for producing commercial batteries, we will conduct new Labour Rights risk assessments of these suppliers.

Freyr Battery has established a grievance mechanism for all employees through an internal anonymous whistle blower channel on our intranet as well as third parties externally through an anonymous whistle blower channel on our webpages. Procedures to handle grievances is established with the Compliance Officer as responsible received and the Board of Directors and a policy for protecting whistle blowers is also established and made publicly available.

FREYR Battery is implementing our approved labour rights relevant policies by:
- publishing them externally on our web pages
- publishing them in the Management System which is being developed
- all suppliers have to sign our SCoC
- conducting training (mandatory) for all employees on the Code of Business Conduct and Ethics
- established consultation committee with employee representatives on health and safety issues in accordance with Norwegian law
- implemented agreements and conducted negotiations with established unions amongst Freyr Employees on annual compensation increases
- conduced awareness sessions with management and employees on discrimination and harassment
- implementing monitoring of comparable pay for comparable work in the companies HR software systems
- Employees sign our policies while they are onboarded in our HR software system (Code of Business Conduct and Ethics, Global Anti-Bribery and Anti-Corruption, Insider Trading, Bullying and Harassment)

We are in the process of developing our management system and the requirements in our labour rights policies will be implemented in the various relevant working processes in the company such as our operational health and safety processes, procurement process and Enterprise Risk Process. We are also preparing awareness training for employees on labour rights starting with those working in the highest risks areas which will be mainly operations, projects, procurement and raw material sourcing.

As Freyr in the period for this COP have assessed our labour rights risks to be low and we have had no grievances nor other findings of labour rights breaches, we have not had any activities in following up or investigating breaches. We have included in all our supplier contracts so far, the need for adequate policies in place and our right to information about labour rights governance as well as the right to do audits of the supplier on this issue.

We are in the process of implementing reporting overviews, software and processes in order for us to be able to capture any issues and be transparent about this as we start growing as a company (204 fte per October 2022) and developing new supply chains.

We have the following status of demography factors per October 2022:
Nationalities, 28 different nationalities with Norwegians constituting 62% and all others between 0,1 % - 5 %
Gender, 74 % male, 26 % female and 0 non-binary
Age, average age 41,9 years and falling over the last 12 months

FREYR Battery's mission is to enable the decarbonisation of the global transportation and power sector. We see our existence as driven by the worlds maybe largest environmental challenge: global warming due to human induced climate change. Our goal is to produce green batteries with eventually net zero carbon footprint of our batteries. We are providing the world with clean technology in our batteries themselves, but we are also licenced to use next-generation battery manufacturing technology (24M) which uses 50% less energy in the process than conventional technology. The 24M technology also allows FREYR to use less space for the factories as well as no toxic binding chemicals. This also allows for FREYR batteries to be easier to recycle due to the lack of binders in the battery cell chemistry.

FREYR Battery has in the period for this COP started the building of a battery manufacturing pilot plant. There has been no battery production nor delivery to customers in the period. It is therefore early phase work to establish the governance within environmental issues related to battery value chain and more focused on the environmental issues surrounding the building of factories in Norway.

In this period, we have developed, through stakeholder consultation in Norway, approved by the Board of Directors and published on our websites a Code of Business Conduct and Ethics which states; "FREYR is committed to sustainability in our business activities, seeking to minimise our environmental impact. We will conduct our business with the continuous objective of reducing energy consumption, chemical and waste generation, and pollution and emissions to air, soil and water. We will select technology and design of facilities and products that facilitates effective recycling and re-use of products and materials"

FREYR's environmental commitments are also described in more details in our ESG Policy published on our website. We have furthermore published on our websites our Supplier Code of Conduct which states: "FREYR’s vision is accelerating the decarbonisation of all transportation and energy systems. FREYR’s mission is to deliver the world’s most cost effective, efficient and environmentally friendly batteries. Accordingly, FREYR will only work with Suppliers who commit to being a part of a decarbonised battery value chain. FREYR requires that all Suppliers have set and committed to science-based reduction targets1 for scope 1,2 and 3 climate gas emissions2 towards 2030 and beyond with realistic plans for reaching these targets, as well as systems to monitor and document such emissions. We expect Suppliers to share these targets, plans and emission data with FREYR. In addition to complying with all applicable laws and regulations, Suppliers are expected to promote environmental business practices in a manner that is appropriate to their business operations. Suppliers are expected to adopt the precautionary principle in addressing potential environmental impacts from their operations."

As FREYR operations currently is in a highly regulated country (Norway) our environmental risk assessment in the period has been focused on the establishment of our Supply Chain contracts in compliance with our ambitions and requirements. All of the suppliers to the pilot factory have been assessed to be in low-risk countries for potential environmental breaches.

We have furthermore started the implementation of ISO 14001 Environmental Management and will be seeking certification for this for the pilot factory before starting production in Q1 2023.

As we move into the building of our Giga factories for battery production (final investment decision pending), and we develop a supply chain for producing commercial batteries we will conduct new environmental risk assessments of these suppliers as well as communicating the high expectations from FREYR on low/carbon materials and high degree of transparency and data availability.

FREYR Battery is implementing our approved environmental relevant policies by:
- publishing them externally on our web pages
- publishing them in the Management System which is being developed
- implementing the standards and requirements into our various processes in the company (procurement, product design, factory design, factory construction, etc)
- implementation of Waste Management System as part of our production process
- implementation of highly focused Operational Excellence and resource efficiency program
- all suppliers have to sign our SCoC

We are in the process of developing our management system and the requirements in our environmental policies will be implemented in the various relevant working processes in the company. We are also preparing awareness training for employees on environmental management with those working in the highest risks areas.

During the period for this COP FREYR has established an Enterprise Risk Management process regulating the risk assessments, information gathering, handling of red flag issues, documentation and archiving. We are in the process of ISO 14001 certification of our Environmental management System.

We have also conducted Life cycle Analysis of the Co2-footprint of the battery that is now being planned for production in the pilot factory and used the analysis to create a roadmap for lowering the emissions by 80% and beyond.

We have had no environmental incidents in the period as would be reported in accordance with the companies HSE incident reporting policy and program. These reports are reviewed by the management every week. There are ongoing external audits of environmental performance being conducted as part of project financing considerations. Results from this audit will be followed up by FREYR but the report will be owned by the financial institution
.
The main responsible for environmental work in the company is the Sustainability Officer and the COO. The Audit and Risk Committee of the BoD is supervising and have oversight on the environmental work within the company.

FREYR Battery has in the period for this COP started the building of a battery manufacturing pilot plant, and preparation for construction of a Giga Factory in Mo, Norway. Our activities are thus mainly comprising construction and installation work at site in Norway, and manufacturing of key machinery to the plant by our suppliers in other jurisdictions. As there is yet no production, there have been no raw material supply from our suppliers. There has been no battery production nor delivery to customers in the period.

FREYR has a zero-tolerance for corruption and bribery. This is explicitly stated in the FREYR Code of Conduct and Business Ethics, which also states that “FREYR will conduct our business consistently with the fundamental human and labour rights as defined in the United Nations (“UN”) Guiding Principles on Business and Human Rights, the 10 Principles of the UN Global Compact and the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work”. Our zero-tolerance policy on corruption and bribery is also stated in the FREYR Global Anti-bribery and Anti-corruption Policy (“ABC Policy”).

Principles of conduct, process and guidance for the company and our staff are further detailed in our ABC Policy, which also includes practical examples and how to act, red flags, procedures for notifying concerns, etc.

FREYR has clearly stated expectations to our suppliers through our Supplier Code of Conduct – including conforming to our strict requirements related to Corruption and bribery - stating that:
“FREYR has a zero tolerance for any form of bribery, corruption, money laundering and fraud. Suppliers are expected not to be involved in offering or accepting bribes, neither directly nor through a third party, or be involved in fraud, money laundering or such prohibited practices. FREYR does not tolerate offers or demands of bribes to or from any FREYR representatives. FREYR expects Suppliers to implement adequate procedures, controls and monitoring to ensure compliance with applicable anti-corruption laws and regulations and compliance with this Code. FREYR has a no-gift policy. Suppliers are expected not to offer gifts, directly or indirectly, to any employees of FREYR or any person closely associated with employees of FREYR.”

FREYR considers the risk of corruption and bribery in Norway as low. However, as several of our suppliers are located in other jurisdictions, we have conducted a risk assessments and integrity due diligence (IDD) on such relevant suppliers.

FREYR has the following goals for the upcoming year:
- Continue having zero ABC incidents/findings.
- Implement further employee training.
- Building a holistic ABC compliance program

During the period for this COP FREYR has established an Internal IDD Procedure regulating the process of risk assessments, information gathering, handling of red flag issues, documentation and archiving.

FREYR has focus on transparency and building a culture of trust and openness, and protection of whistle-blowers. This is based in the principles laid down in the FREYR Code of Conduct and Business Ethics and in the FREYR Whistle-blower Policy. A third party administrated Whistle-blower Channel (with the possibility of fully anonymous reporting) was established in 2021, and information and links to the channel was placed on the company website and employees informed. The policies requirements are followed up with development of the Whistle-blower Complaints Guidelines for internal handling of reports of e.g. incidents or suspicion of corruption or bribery.

ABC issues are part of our regular Compliance training of new employees and is part of our compliance training. All employees are obliged to read and sign the Code of Conduct and Business Ethics and the ABC Policy.

The main responsible for anti-corruption and anti-bribery work in the company is the Compliance Officer. The Audit and Risk Committee of the BoD is supervising and have oversight on the ABC work within the company.

Incidents of corruption or bribery, or suspicion of the same, shall under the ABC Policy be immediately reported to the Compliance Officer at the designated email, through the Whistle-blower Channel/hotline or directly to the Audit and Risk Committee of the BoD. Protection from retaliation on the reporting person is highlighted in the ABC Policy.

The Compliance Officer or a designee will conduct an annual review to confirm the adequacy and effective implementation of the ABC Policy. To the extent any material irregularities are noted during such reviews, the Compliance Officer or a designee shall promptly take any actions deemed necessary or appropriate.

FREYR has in the reporting period had no incidents of bribery or corruption, and no investigations, legal cases, rulings or fines or events.

As a fairly new company, the progress made during the reporting period in the area of anti-bribery and anti-corruption is in the building of sound and robust policies, processes and guidelines, and training and raising of awareness of our employees.

Audit of anti-corruption programme and procedures will be part of the company’s Internal Audit Plan for 2023-2024