Managing impacts, risks and opportunities [S1-1]

As an employer, we focus on employment stability, as evidenced, among other things, by a low employee turnover rate of 10.52% and an average length of service of 15 years for individuals employed under employment contracts, excluding individuals employed at 0.1 FTE (as at 31.12.2025). Long-term cooperation reflects a high level of employee satisfaction and is underpinned by lasting relationships built on secure employment conditions through appropriate internal regulations applied at the Bank.

The primary document governing work organisation and workplace rules at the Bank is the Work Regulations (hereinafter: the Regulations). This constitutes an internal source of labour law; it sets out the rights and obligations of the employer and of employees employed under an employment contract, regardless of the nature of their duties or the position held. Every newly hired employee is required to confirm that they have read the document. We subject the Regulations to periodic reviews and, where necessary, update their provisions in agreement with trade union organisations and in line with generally applicable law.

For termination of employment, we apply notice periods resulting from the Labour Code or directly from employment contracts, which ensure at least the same benefits as those provided for under labour law. In 2025, we predominantly applied one- or three-month notice periods. In addition, we conduct consultations regarding termination of employment contracts in accordance with applicable national regulations.

For termination of employment, we apply notice periods resulting from the Labour Code or directly from employment contracts, which ensure at least the same benefits as those provided for under labour law. In 2025, we predominantly applied one- or three-month notice periods. In addition, we conduct consultations regarding termination of employment contracts in accordance with applicable national regulations.

We enable our employees to work outside the employer’s premises on the terms set out in detail in the Agreement on the rules for performing remote work, concluded between the Bank and the Trade Unions on the basis of the amended provisions of the Labour Code. This Agreement sets out, in detail, both the organisation of remote work and the corresponding rights and obligations of the employer and the employee. In addition, taking account of employees’ expectations, we consider on a case-by-case basis requests relating to non-standard working hours or changes to the location from which remote work is performed, demonstrating a flexible approach to their needs. Employees raising children under the age of 8 are also able to work remotely to a greater extent.

We treat our employees fairly and ensure adequate pay through a consistent remuneration system, including non-pay benefits. The remuneration strategy embedded in the applicable internal regulations, which supports the protection and strengthening of the Bank’s reputation is the key element of this system.

The principal regulation is the Remuneration Policy of Bank Polska Kasa Opieki Spółka Akcyjna (hereinafter: the Remuneration Policy), available on the intranet. This Policy reflects the Bank’s mission and values in its approach to remuneration systems, and in particular:

• The principal regulation is the Remuneration Policy of Bank Polska Kasa Opieki Spółka Akcyjna (hereinafter: the Remuneration Policy), available on the intranet. This Policy reflects the Bank’s mission and values in its approach to remuneration systems, and in particular:
• defines the pillars of remuneration and the management of the structure, corporate processes and organisational processes;
• confirms the requirement that adopted remuneration systems comply with generally applicable law.

The remuneration structure provides a direct link between remuneration and performance by safeguarding financial stability and setting variable remuneration levels appropriate to the Bank’s financial capacity; establishing performance-based remuneration caps; and designing incentive schemes that specify minimum performance levels for the Bank below which no bonus is paid. Variable remuneration covers all remuneration components whose award is conditional on performance, and its payment depends directly on individual achievements, a compliance assessment, and the results achieved by the Bank and adjusted for risk.

A permanent element of remuneration is base salary, which we pay for the position held and the scope of duties and responsibilities. This remuneration reflects both the experience, skills and competences required for a given position and the level of commitment to achieving the Bank’s results. Since fixed remuneration represents a substantial part of total remuneration, we are able to pursue a flexible remuneration policy.

The Bank monitors market trends regarding forms of remuneration and pay levels offered in the market to ensure the competitiveness of remuneration structures, as well as their transparency and an effective and fair remuneration system. Decisions concerning the remuneration system are taken based on information on market trends in fixed remuneration as well as incentive schemes. We obtain these data from advisory firms analysing the financial sector. We also prepare an annual report on the operation of the remuneration policy, which consists of two internal regulations: the Remuneration Policy of Bank Polska Kasa Opieki Spółka Akcyjna and the Remuneration Policy of the Members of the Supervisory Board and the Management Board of Bank Polska Kasa Opieki Spółka Akcyjna.

The annual report assessing the operation of the remuneration policy is prepared by the Nomination and Remuneration Committee based on the report on the operation of the remuneration policy for a given year submitted by the Bank’s Management Board. Subsequently, following approval of the report assessing the operation of the remuneration policy for a given year by the Bank’s Supervisory Board, it is presented to the General Meeting of Shareholders (GMS) in order to assess whether the Bank’s remuneration policy supports the Bank’s development and the security of its operations.

We maintain ongoing communication with our employees and respect their right to establish and join trade unions, conducting open and transparent dialogue with all trade union organisations operating at the Bank, as well as with the Employee Council. In relations with trade unions, we are guided by the principle of good faith and by the pursuit of optimal solutions in the field of collective labour law, taking into account the interests of both employees and the Bank.

The principles of the Bank’s HR and pay policy, including employees’ remuneration conditions, are governed by the Company Collective Labour Agreement (Zakładowy Układ Zbiorowy Pracy – ZUZP; hereinafter: the ZUZP). The document contains a detailed description of all remuneration components and work-related benefits, such as base salary, quarterly bonuses, a motivational award and a holiday bonus. It also sets out the rules for remuneration for overtime work and governs other benefits, including retirement, disability and death severance payments, as well as compensation for accidents at work.

Amendments to the ZUZP are introduced through negotiations with the trade union organisations that are its Parties, and each change is documented in an additional protocol, which is registered by the Regional Labour Inspector. The ZUZP is available to all Bank employees on the intranet website, while newly hired individuals receive information about the ZUZP in their employment contract.

In 2025, the percentage of the Bank’s employees covered by a collective agreement amounted to 78.9% (versus 77% in 2024). No collective agreements were concluded in the Pekao Group’s subsidiaries.

The Bank has in place a Gender Equality and Diversity Policy applicable to the Bank’s employees, including members of the Supervisory Board, members of the Management Board and key functions holders at Bank Polska Kasa Opieki Spółka Akcyjna (hereinafter: the Gender Equality and Diversity Policy), through which we promote equal treatment and prevent discrimination in the workplace.

In line with this policy, we ensure that Bank employees can manage their careers effectively, achieve success and have their work assessed based on individual performance, regardless of gender. In addition, as part of our integration commitments and actions supporting employee groups particularly exposed to risk, Chapter III of the Gender Equality and Diversity Policy includes provisions on supporting people returning to work after a prolonged absence, for example after parental leave.

The Policy incorporates the Bank’s diversity strategy, which emphasises the delivery of tasks by our employees to the highest standards, the application of objective, merit-based criteria, and the inclusion of diversity considerations when assessing competencies and selecting persons to serve on the Supervisory Board, the Management Board and in key functions at the Bank. Furthermore, we apply the guidelines on gender equality in all HR processes. In practice, this means that we:

• strive to ensure representation of both genders in internal and external recruitment processes by preparing shortlists for a given role that include at least one candidate of each gender;
• strive to ensure representation of both genders in internal and external recruitment processes by preparing shortlists for a given role that include at least one candidate of each gender;
• inform our external partners in training and recruitment (including employment agencies, temporary work agencies, job placement/intermediation agencies, head-hunters and labour offices) about the scope of the Gender Equality and Diversity Policy implemented at the Bank and our application of its guidelines;
• inform our external partners in training and recruitment (including employment agencies, temporary work agencies, job placement/intermediation agencies, head-hunters and labour offices) about the scope of the Gender Equality and Diversity Policy implemented at the Bank and our application of its guidelines;
• ensure equal treatment in pay and fringe benefits regardless of gender, in accordance with the Remuneration Policy of Bank Polska Kasa Opieki Spółka Akcyjna and generally applicable law;
• promote employees’ work–life balance by making available procedurally regulated solutions such as:
  • flexible working arrangements (part-time employment, etc.) in compliance with applicable laws, in particular labour and social security regulations, as well as internal rules, while taking account of business and organisational requirements and needs;
  • support for employees during and after long-term absence (e.g. parental leave, unpaid leave, illness or other extended breaks from work) through the possibility of maintaining ongoing contact with the Bank during absence and facilitating a return to work in line with applicable laws (in particular labour and social security regulations) and the Bank’s internal rules;
  • educational programmes on gender equality delivered, among other things, as part of onboarding programmes and other forms of training, also addressed to managers – for example the e-learning module Equal treatment in employment, aimed at all managers.

Applying the guidelines set out in the Gender Equality and Diversity Policy also includes monitoring the remuneration structure. In 2025, the unadjusted gender pay gap at the Bank amounted to 28.50%, which represents a decrease compared to 30.99% in 2024. The adjusted gap, calculated as a weighted average for employee sub-groups taking into account grade levels, job families and the division in which a given employee is employed, amounted to 0.95% in the same reporting period (vs. 2.18% in 2024). The results of this monitoring support decisions on verifying pay levels for work of equal value, in order to maintain balance and fairness in this area as well.

We seek to maintain gender balance among managers covered by succession plans, where senior management includes members of the Bank’s Management Board and Directors of Divisions, Centres and Departments reporting directly to the Management Board. We provide equal opportunities for promotion and professional development regardless of gender, which supports the creation of a balanced and inclusive working environment.

We also run a range of development initiatives, support diversity and encourage employees to put forward their own ideas and actively engage with the projects we have launched – so that they have the conditions to develop their potential and feel recognised. For managers in particular, we deliver training based on the Insight Discovery methodology to raise awareness of diversity management. These workshops focus on recognising employees’ diverse needs and identifying effective motivation methods depending on age, experience, skills and competencies.

Education and competence-building for Bank employees are important to us. We recognise that professional development opportunities have a positive impact – on the one hand – on employees’ sense of belonging to the organisation and – on the other – on the delivery of tasks necessary to achieve the organisation’s goals. This is why we offer a diverse range of educational programmes for Bank employees, including:

• local training and general development webinars;
• international training and programmes;
• mentoring and group/team coaching;
• individual internal and external coaching;
• certification training, e.g. CFA/ACCA/CIA.

The processes relating to employees’ participation in specific forms of professional upskilling are set out in the Training, Professional Qualifications and Development Activities Policy for employees of Bank Pekao S.A., which addresses in detail:

• procedures for classroom-based group training, remote training and e-learning;
• procedures for individual domestic training, certification courses, language courses, postgraduate studies and MBA programmes;
• training needs assessment.

Another fundamental and equally important issue for us is occupational health and safety (OHS). It underpins employees’ comfort and the quality of their work. Accordingly, using available technologies appropriately and in line with regulations, we educate employees in this area and inform them about all aspects of the working environment.

OHS activities are governed by the Regulation of the Council of Ministers of 2 September 1997 on the occupational health and safety service, which specifies in detail the qualifications required for employees of the OHS Office and the scope of their duties. We implement the provisions of this Regulation, among other things, through systematic inspections of working conditions, taking into account how processes are organised and how they affect working conditions, the technical condition of premises, and submitted requests relating to OHS requirements.

We have two key internal OHS regulations: the Occupational Health and Safety and Fire Protection Rules and the Bank Pekao S.A. Group OHS Policy. These documents are developed and implemented by the OHS Office within the Logistics and Cash Operations Department. Substantive oversight of the Office’s activities is exercised by the Vice-President of the Bank’s Management Board responsible for the Branch Distribution, Private Banking and Operations Division. Certain issues in this area are also governed by the Work Regulations. These documents serve as a baseline when developing internal instructions and procedures addressed to employees.

In workforce matters, including those relating to violence and harassment in the workplace, we apply the Procedure for preventing mobbing, discrimination, harassment or other undesirable behaviour at Bank Polska Kasa Opieki Spółka Akcyjna. The provisions of this document express our zero tolerance for any manifestations of discrimination and our commitment to counteracting them; they also describe mechanisms for handling employee complaints about unethical practices, including violence and harassment.More information about this procedure and the mechanisms themselves is provided in chapter [ESRS G1].