MTS implements some initiatives aimed at reducing the environmental impact and is actively involved in environmental enlightenment among the stakeholders. Transition to a cyclic economy, and introduction of up-to-date digital solutions help to reduce the carbon footprint for not only the entire MTS Group, but for its employees, customers, partners and local communities.

Environmental concern is an important part of the MTS Group’s ESG strategy, being one of its priority areas, and includes three focus subjects: “Responsible Resource Management”, “E-Waste Management” and “Carbon Management”. These strategic approaches are aimed at reducing the environmental impact and helping to create a more sustainable future both for the Company and society as a whole.

Focus subjects of ESG-strategy:

• Responsible resource use
• E-waste management
• Carbon management

MTS activities in environmental protection are based on Russian Federation legislation and are governed by the internal Environmental Policy of the Company. Designing MTS network facilities includes a “List of Actions for Environmental Protection” that is developed in accordance with GOST R 21.1101-2013 requirements.

In 2024, the “Production and Consumption Waste Management” Standard was introduced and finalized to set the requirements for the management of waste generated as a result of the Company’s business and other activities at the facilities causing a negative impact on the environment.

The standard goals are the following:

• compliance with Russian Federation legislative requirements in the field of production and consumption waste management;
• desire to reduce environmental risks and ensure environmental safety at facilities causing a negative impact on human health and the environment when handling production and consumption waste;
• desire to introduce and maintain closed cycle economy approaches when managing production and consumption waste when conducting the Company’s business and other activities.

The Policy “Environmental Safety and Environmental Protection at Administrative Facilities” covers MTS Group activities as well. Company subsidiaries, as they join this Policy, adapt their internal documents in a consolidated manner, taking into account the environmental principles.

The Company has built a unified environmental management system that guarantees compliance with and fulfillment of the environmental legislation codes. Issues of efficient management of environmental risks, as well as related activities and initiatives are governed by the “Ecology” compliance program that emphasizes our commitment to environmental protection and sustainable development.

Energy efficiency management

As the MTS business grows, both energy consumption and greenhouse gases (hereinafter “GG”) emissions increase.

The MTS Group of Companies actively implements various programs and initiatives in the field of energy conservation, including introducing energy-efficient solutions in their networks, use of artificial intelligence and big data logics, and also events to improve the awareness of employees on the importance of efficient energy use.

The Company develops and implements projects that help to improve energy efficiency in the offices, and also designs digital products aimed at solving problems in this area. Every year, we reduce the level of energy capacity of the business processes, upgrade the equipment and launch regional energy-saving programs in MTS branches.

To reduce energy consumption by base stations, MTS uses modern energy-saving equipment. Moreover, this segment is a driver for technological innovations and has significant potential for reducing greenhouse gas emissions.

The Company pursues the provisions of the Strategy fir Energy Saving and Energy Efficiency in its business, which is an internal document aimed at restricting growth and reducing electricity specific consumption. We follow Russian and international standards strictly, such as, for example, GOST R ISO 50001-2023.

Every year, the MTS branches develop, approve and introduce regional energy-saving and energy- efficiency improvement programs. Implementation of the approved measures becomes one of the main efficiency parameters for the branch directors. To assess the performance of the program initiatives, internal audits are conducted on a regular basis. Additionally, MTS uses renewable energy sources to support reliable operation of base stations in remote and hard-to-access areas.

We pay special attention in our business to the improved efficacy of resource use. In 2024, the volume of power consumed by MTS was 1,948.98 million kW·h that is 0.8%. higher compared to the previous period.

Volume of energy resources used by MTS PJSC in 2024

Resource type	Natural expression		MTS Group of Companies
	Quantity	Measurement unit	MTS, MTS Bank, MGTS, RTC, MTT, MTS Digital, MTS Belarus, DPC GreenBush
Electricity (from the grids)	1,948,977,447.69	kW·h	2,160,583,156.9
Heat energy	46,945.59	Gcal	102,173.7
Water supply	195.4	thous. cbm	325.33
Gas supply	1,281,137.63	cbm	1,833,540.7
Gasoline	2,046.08	thousand liters	2,847.1
Diesel fuel	3,293.0	thousand liters	3,987.5
Liquefied oil gas – propane	8.07	thousand liters	8.1

Carbon management

MTS assesses and regularly monitors greenhouse gases emissions. The methodology of estimating and analyzing GG emissions is based on methodological principles compliant with the international norms and cutting-edge practices. Understanding the relevance and importance of the carbon agenda for society, the company regularly discloses a wide range of environmentally significant data about its activities, including resource consumption, as well as volumes of direct and indirect greenhouse gas emissions.

An important 2024 event in the “Environmental Concern” area was the approval of the Greenhouse Gas Emissions Management Strategy (carbon strategy). Under the Road Map of this strategy, the Company takes a number of measures to reduce the environmental impact of the MTS Group and monitors their completion carefully.

Within the “Carbon Management” area, MTS actively supports decarbonization and contributes to the global fight against climate change, taking into account the climate risks and taking specific steps to reduce its carbon footprint. In 2024, the company started working on a qualitative and quantitative assessment of climate risks.

These risks may be divided into two main categories:

1) Physical risks – related to physical consequences of climate changes (extreme weather conditions, temperature extremes, etc.) For the Company, these phenomena may bear the risk of infrastructural damages, complete shutdowns and temporary failures in the operation of DPCs, offices and base stations.

2) Transition risks – related to potential stiffening of carbon regulation, changes in the international and national regulatory framework, standards and initiatives, requirements of financial organizations and other stakeholders, changes in consumer preferences. For the Company, these phenomena may bear the risk of adverse financial, reputation and legal consequences.

Closed cycle economic development

Every year, MTS implements initiatives to introduce the principles of a closed cycle economy in the business processes of the Company, maintaining responsible consumption and sustainable resource management.

Since 2020, the company has been implementing the complex ecosystem project “Life Cycle Laboratory”, which promotes environmentally significant changes in different business areas of MTS, including introduction of a system for separate waste collection (hereinafter “SWC”).

The SWC project scaling in 2024 increased considerably the volumes of secondary materials sent for recycling. This was possible due to expansion of the list of separately collected recyclable materials and active involvement of the regions, where MTS does business. Introduction of the separate collection system, and then transfer of waste for responsible recycling were successfully implemented in 22 offices and encompass 11 regions of Russia.

The company pays special attention to e-waste and outdated electronic equipment, since these are industry-specific waste and contain substances that are hazardous for the environment. Electronics handling is regulated strictly in MTS in terms of the contractors having valid licenses for waste collection and recycling.

Refurbishment program

A refurbishment program is active in MTS that makes it possible to manage the life cycle of the unpopular equipment responsibly. The company tries to minimize the environmental impact and promote a more sustainable future by extending the service life, reusing, recycling and reselling.

In 2024, the MTS Group facilities assembled and transferred to responsible contractors around 1,550 tons of recyclable materials for reprocessing and environmentally-friendly recycling. Technologies that increase the IT equipment service life were actively introduced. In partnership with SuperWave company, in 2024, under the program of customer equipment refurbishment, 333.4 thousand electronic devices were refurbished, which made it possible to prevent the appearance of 55 tons of plastic and 30 tons of electronic waste. Under the program of customer equipment refurbishment, in 2024, 46,843 kg of plastic and 26,505 kg of electronic components were transferred for responsible recycling.

The MTS Group of Companies works on the comprehensive transition to electronic document flow (hereinafter erred to as EDF), scaling best practices to subsidiaries.

Successful introduction of the EDF system to MTS makes it possible to consistently improve the efficiency of business processes, ease the employees of multiple routine operations and reduce the volume of used materials.

Environmental awareness programs

One of the key components in the MTS ESG-strategy is implementing the digital environmental awareness and volunteer projects aimed both at the Company’s employees and partners and the public in the regions of presence.

MTS actively emphasizes the importance of responsible consumption, environmental concern and support for environmental activities and ecotourism. Every year, the Company expands its audience of educational content users, making it available for various categories of the public. We use state-of-the-art digital technology to make environmental awareness available and transparent for everyone, inspiring society to protect nature actively.

The environmental awareness projects of MTS combine the experience and expertise of the Company in developing innovative and technology-savvy products, large social potential of the employees, who act as minds behind and drivers of this area, and also the request from the regions of MTS presence for technology-savvy and interesting digital products, making it possible to easily master environmental patterns in nature and daily life of people. The total coverage of online and offline projects on the topic of environment is more than 2 million users from all over the country.

Additionally, the Company initiates large-scale environmental enlightenment programs annually, encompassing all MTS Group employees. In 2024, the Company started developing the internal corporate environmental enlightenment project “Inspire (Be Inspired)” that will be dedicated to environmental friendliness and preservation of resources using state-of-the-art digital technology. This project is aimed at inspiring employees to active steps, promoting sustainable development and nature protection, and to improve awareness of the importance of responsible consumption in daily life.