ArborGen Climate Statements FY 2024

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CLIMATE
STATEMENTS
FY 2024

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Table of Contents

Introduction 2
Governance 3
Strategy 4
Risk Management 13
Metrics and Targets 14
Appendix: Methods, assumptions and limitations 21






IMPORTANT NOTICE
ArborGen makes no representations as to this report’s accuracy, completeness or reliability, in particular in
relation to assumptions regarding future events. It expressly disclaims responsibility for, and makes no
representation, and gives no warranty, assurance or guarantee, as to the accuracy, completeness, or reliability of
any contents of this report. To the greatest extent possible under New Zealand law, it also expressly disclaims all
liability for any loss (direct, indirect, consequential, or otherwise) or damage arising from the use of this report.

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Welcome to our Climate Statements for FY24

As a horticultural business, ArborGen Holdings Limited’s (ArborGen, "we" or "our") operations are inherently
linked with climate. Climate change presents both risks and opportunities for our business. Identifying,
monitoring, mitigating and responding to climate-related events forms an integral part of ArborGen’s strategy
and operations. ArborGen uses climate related opportunities to understand how we serve people, customers
and shareholders, govern the company and protect the natural environment.
This report contains our first climate statements under the Aotearoa New Zealand Climate Standards and
covers ArborGen's financial year from 1 April 2023 to 31 March 2024.
We have provided our current assessment of the climate-related impacts, risks, and opportunities material and
relevant to ArborGen's business. This report is a point-in-time assessment based on assumptions regarding the
future which are inherently uncertain, often outside our control and likely to change. Where relevant, these
limitations are set out in this report.
We will continue to monitor the potential impacts of climate change on our business.
For this year, ArborGen has elected to use the following adoption provisions:
Adoption provision Commentary
Adoption provisions 1 and 2:
Current and anticipated
financial impacts
A qualitative description of the current and anticipated financial impacts
has been provided. A quantitative assessment of financial impacts will be
disclosed in our second reporting period.
Adoption provision 3:
Transition planning

As part of its annual strategy review, ArborGen will progress towards
developing its transition plan. Climate-related risks and opportunities
will be an ongoing part of ArborGen's strategic planning process.
Adoption provision 4: Scope
3 GHG emissions
Scope 3 emissions will be reported in our second reporting period.
Adoption provision 6 and 7:
Comparatives and trends
ArborGen is at the early stage of its emissions measurement journey and
FY24 is the first year of reported data.

ArborGen confirms these climate statements comply with the Aotearoa New Zealand Climate Standards.



David Knott Paul Smart
Chairman of the Board Chair Audit and Risk Committee

30 July 2024

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Governance
Board of Directors
The ArborGen Board is responsible for the oversight of climate-related impacts, risks and opportunities. Due to
the size and nature of the business, the whole Board takes overall responsibility for sustainability and climate-
related risks and opportunities. The Board also reviews ArborGen's ESG and sustainability policies regularly.
The ArborGen Directors possess competencies in this area and all Directors are responsible for continuous
training and keeping themselves informed on relevant climate issues. ArborGen's Board competency
framework includes skills and experience relating to climate risk as a relevant consideration. The Board will
continue to have information from relevant climate experts as part of the Board schedule to monitor new
developments.
To assist the Board, the Audit and Risk Committee (ARC) identifies and considers all relevant climate matters at
least annually and as significant risks and opportunities arise. ArborGen has also engaged external experts to
provide additional knowledge and assist with disclosures and reporting.
The Board generally meets at least four times per year and receives recommendations and insights from
management and the ARC, including on climate-related issues. The Board reviews these reports and ensures
proper implementation of internal controls and risk management processes. As part of its annual strategy
review, the Board considers the influence of climate change and devises strategies for the short, medium and
long term.
ArborGen is at the early stage of its carbon measurement journey. With the data now available, ArborGen will
consider appropriate targets and initiatives to achieve them. The Board will approve these metrics and on an
annual basis monitor progress against these targets through regular reporting from management.
Management’s role

Day-to-day responsibility for identifying and
implementing strategic initiatives related to climate
risk and carbon emissions sits with the executive
team.

ArborGen appointed a new VP Operations, starting
in March 2024, with delegated responsibility from
the CEO to identify, manage and report climate-
related issues.

Management report to the ARC, and the Board, on
climate related risks and opportunities on a
quarterly basis. Management is responsible for
assessing the impact of climate on the business
and ensuring mitigation plans are in place.




Board
• Oversight and governance
Audit and Risk Committee
• Additional risk assessment of climate related activities
• Review appropriate countermeasures to mitigate risks
Management
• Vice President of Operations – ensures overall climate
risks are continuously assessed and reviewed. Ensures
controls are in place to mitigate risks
• Chief Financial Officer – ensure compliance to policies,
ensure risks are appropriately assessed and scenario
analysis is financially assessed and reported.

Each business unit is also tasked with identifying climate-related risks and opportunities relevant to their
function. ArborGen's risk register is updated with any new material information.

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Strategy
ArborGen is the leading provider of advanced genetics seedlings for the forest industry. We use our technology
platform, production capabilities and sales and marketing to transform forest productivity.
ArborGen is committed to conducting business in the right way, ethically and in line with legal and regulatory
obligations, to ensure we add long term value to staff, contractors, shareholders and other stakeholders. Our
ESG principles provide meaning beyond just commercial gain, and look to how we serve our stakeholders,
govern the company and protect the natural environment for now and the future.
Current climate-related impacts
As a horticultural business, climate risks are inherent to the sector. Managing these risks is a critical part of
business management and a specific item in our risk register. In addition, the increasing emphasis on the role
trees can play in offsetting carbon emissions through sequestration is creating new climate-related
opportunities for ArborGen.
Currently ArborGen has sites across the southern part of the United States (Alabama, Arkansas, Georgia,
Florida, Texas, and South Carolina) and multiple locations in Brazil (mainly in the southern regions).
As our business operates mostly outdoors, we face risks from excessive rains, hail, freezing, hurricanes, drought
and excessive heat. In the past, we have had entire crops destroyed at individual locations due to extreme
weather events, so ArborGen knows what extreme weather can do to our business.
Climate and weather and the impacts it can have on our business are, and have been, ingrained into our
business practices for more than 30 years. We feel confident that we have already taken many steps to protect
our assets from extreme weather, in particular excessive rains.
Table 1 – Current climate-related impacts
Business area ArborGen’s current physical and transition climate-related impacts for
FY24
Business model (including
operations) and value chain
A series of extreme weather events across ArborGen’s Southern US
operations caused varying degrees of damage to nurseries and orchards.
Significant events included a severe hail event in the US that impacted
ArborGen’s Jasper nursery with an estimated crop loss of 8 million seedlings.
In May 2024; Jasper, TX, Bullard TX, Livingston TX and Bluff City AR
experienced approximately 30% of its average annual rainfall in this one
month. This impacted ArborGen’s planting and production practices that are
both critical for timely growth of seedlings and fulfilling customers' orders.
Operating costs
The impact of extreme weather events on ArborGen has resulted in
increased insurance claims and operational costs due to damaged
nurseries, orchards and other infrastructure. In 2023, ArborGen filed a
significant insurance claim for damage to its nursery in Bluff City AR,
following an intense weather period.
While it isn’t a material impact in this current reporting year, ArborGen will
continue to monitor insurance claims related to climate-related events.
ArborGen has acknowledged that the costs incurring from damage to our key
infrastructure and product, could be material in the future.

Based on this history, and our current strategy, we consider that we are well positioned to mitigate risks and
respond to opportunities arising from the transition to a low-emissions, climate resilient future.

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Climate scenario analysis
To prepare our first climate statements under the Aotearoa New Zealand Climate Standards, we conducted a
standalone climate scenario
1
analysis process to identify material climate-related impacts, risks and
opportunities across three different futures and test our business. Scenario analysis is a strategic tool for
understanding and exploring how the future may develop under conditions of uncertainty. The outcome of this
process will be used to inform ArborGen's strategy.
This process involved:
• Engaging external consultants (WSP New Zealand Ltd) to support our climate scenario analysis, our
identification and assessment of climate-related risks and opportunities, and the development of some
metrics for vulnerability to climate-related physical and transition risks.

• Running a series of workshops with its staff and executive management (Chief Executive, Chief Financial
Officer, Vice President of Operations, and General Manager of Operations (Brazil)), which involved:

− starting with publicly available information for the agricultural sector;
− defining scenario parameters for ArborGen's climate scenarios;
− aligning ArborGen’s climate scenarios with the Aotearoa New Zealand Climate Standards and
accompanying guidance from the External Reporting Board (XRB) and Financial Markets Authority;
− refining ArborGen's scenario narratives and climate-related risks and opportunities; and
− identifying metrics for physical and transition risks, and climate-related opportunities.

• Board review, consideration, and approval of the scenario analysis process and outcomes.
We have not conducted any modelling, nor quantitative financial impact assessments.
We consider that the scenarios below are the most relevant and appropriate to assessing ArborGen's resilience
and strategy because they are built on widely-used, international baselines adapted to ArborGen's primary
production areas.

Time horizons
We selected three time horizons for our climate scenarios and climate-related risks and opportunities aligned
with our production lifecycles for our seedlings and forecasted adoption of advanced genetics.
Table 2 – Time horizons
Time horizon Year Rationale
Short term 2024-2030 1-7 years, aligned with seedling production cycle
Medium term 2031-2040 7-15 years, reflecting seedling maturation and the increasing
uptake of advanced genetics in the market across the US and
Brazil forestry sector
Long term 2041-2050 >15 years, through to 2050


1
Climate scenarios are plausible and challenging descriptions of how the future might look; they are not predictive or
probabilistic. Scenario pathways are developed based on a coherent and internally consistent set of assumptions about key
driving forces and relationships covering both physical and transition risks in an integrated manner.

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Data sources
To develop climate scenarios relevant to ArborGen’s operational geographies in South America and the
Southern US (the states of Alabama, Arkansas, Georgia, Florida, Texas, and South Carolina), we selected the
Intergovernmental Panel on Climate Changes (IPCC’s) SSP-RCP
2
global scenarios and pathways.
ArborGen uses weather and climate data from the United States federal agency the National Oceanic and
Atmospheric Administration (NOAA) for its Southern US operations and Probable Futures for operations in
Brazil.
3
Through these data sources, ArborGen can assess exposure to climate hazards across its sites. This can
be used for the long term planning and as a tool within ArborGen’s risk management framework for its physical
climate-related risks and opportunities.
Table 3: Scenario archetypes used to construct ArborGen's scenarios
Scenario archetypes Orderly Too little, too late Hot house world
Shared Socio-
economic Pathways
(SSP-RCP)
SSP1-1.9: Sustainability,
very low GHG emissions
SSP2-4.5:
Middle of the road,
low GHG emissions
SSP3-7.0:
Regional Rivalry, high GHG
emissions
Representative
Concentration
Pathways (RCP)
RCP2.6 RCP4.5 RCP8.5

Temperature outcomes and emissions reduction pathways
ArborGen’s climate scenarios focus on three temperature outcomes and emissions pathways aligned with the
requirements of the XRB. These support us in exploring the diverging risks and opportunities of each scenario
pathway.


2
Shared Socio-economic Pathways (SSPs) are baseline narrative scenarios that identify socio-economic assumptions,
geopolitical assumptions and economic and technological trends. These form the basis for modelling the IPCC’s SSP-RCP
scenarios, which combine the baseline SSP scenarios with radiative forcing levels from the Representative Concentration
Pathways (RCPs) to impose global warming targets.
3
With limited climate science and data publicly available for Brazil, ArborGen has referenced the Probable Futures data on
climate projections for Brazil. Probable Futures is a not-for-profit climate literacy initiative that uses a simulation framework:
CORDEX-CORE(8). The scale of data provided through this source creates a notable degree of confidence.

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Table 4: Temperature outcomes and emissions pathways for each scenario
Scenario archetypes Orderly Too little, too late Hot house world
Temperature outcome
(2100)
1.5°C 2.7°C >3.0°C
Temperature outcome
at endpoint (2050)
1.6°C 2.0°C 2.1°C
Emissions pathway SSP1–1.9: “The world
shifts gradually, but
pervasively, toward a
more sustainable path,
emphasising more
inclusive development
that respects perceived
environmental
boundaries.”
SSP2–4.5: “The world
follows a path in which
social, economic, and
technological trends do
not shift markedly from
historical patterns.
Development and
income growth proceeds
unevenly, with some
countries making
relatively good progress
while others fall short of
expectations.”
SSP3–7.0: “A resurgent
nationalism, concerns
about competitiveness
and security, and regional
conflicts push countries to
increasingly focus on
domestic or, at most,
regional issues. Policies
shift over time to become
increasingly oriented
toward national and
regional security issues.”

Underlying assumptions
ArborGen’s scenarios draw on the underlying assumptions of the IPCC SSP-RCP scenarios and emission
reduction pathways. These scenarios cover the assumptions required to be disclosed by the XRB, including:
policy and socioeconomic assumptions; macroeconomic trends; energy pathways; carbon sequestration from
afforestation and nature-based solutions and technology assumptions including negative emissions
technology. ArborGen’s intention is to ground its selected scenarios in credible and commonly adopted
assumptions to create logical climate scenarios for primary users to compare against others in the same sector.
The IPCC’s scenarios qualify.

ArborGen’s scenario narratives
Development of ArborGen’s scenario narratives was informed by an understanding of driving forces that have
the greatest influence in shaping future outcomes for ArborGen.
These tables provide narrative descriptions of ArborGen’s three climate scenarios.
Table 5: Orderly scenario
End of century global
temperature outcome
Relative level of
physical impacts
Relative level of
transition impacts
SSP-RCP scenario
1.5°C
Moderate (in the short-
medium term)
High (in the short term) SSP1-1.9

The world moves deliberately toward prioritising the health of the planet. Governments work together to achieve
the Paris Agreement’s Net Zero 2050 pledge and the commitments of the Kunming-Montreal Global Biodiversity
Framework. Biodiversity and the wellbeing of people significantly improves. ArborGen encounters generally
stable economic and environmental conditions and continues to work in an orderly manner to adapt to climate
change.

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Consumer behaviour shifts, prioritising both sustainability and re-use of materials as well as an increased focus
on carbon sequestration. ArborGen experiences increased sales to supply stock for reforestation and
afforestation projects. Forestry remains an attractive sector to work in. ArborGen benefits from this and
promotes itself as an employer of choice in an environmentally conscious society.
The increasingly challenging climate grows demand for trees with increased resistance to climate and
pathogens. ArborGen invests in research and development to diversify its seedling varieties. Technology
advancement eases the pressure of labour shortages as the adoption of automated methods makes ArborGen’s
operations more efficient and resilient.
The physical impacts of climate change still present challenges to ArborGen in an Orderly scenario, including
periods of drought and flooding events. Climate events occur periodically but due to active investment in
resilient materials for the infrastructure of its orchards and nurseries, ArborGen is prepared and anticipated
impacts are manageable.
Banks and other lenders prioritise sustainability. This creates significant opportunities for ArborGen to utilise
green bonds and sustainability linked loans (SLLs). Many of ArborGen’s customers also have increased access
to capital associated with sustainability linked lending.
Strong land-use change regulation is enforced to protect ecosystems. Deforestation is eliminated completely in
some regions and vastly restricted in others. ArborGen’s customers are incentivised to scale up reforestation
and afforestation projects with the prioritisation of sustainable materials (timber) and new policy for carbon
sequestration and reforestation. This demand generates more sales for ArborGen.
Table 6: Too little, too late scenario
End of century global
temperature outcome
Relative level of
physical impacts
Relative level of
transition impacts
SSP-RCP scenario
>2.0°C
Moderate (in the short-
medium term) - High (in
the long term)
Moderate (in the short
term) – Severe (in the
medium term)
SSP2-4.5

Uncoordinated policy ambition and unsuccessful transition planning globally sees worsening physical climate
change impacts and geopolitical tensions. Abrupt policy changes in the medium to long term exacerbate
inequalities in society, sectors, and regions. Political parties globally eventually coordinate priorities and efforts
to deal with climate change, but displacement and impact has been realised for and on communities,
ecosystems, and industries.
Under this scenario, ArborGen’s business faces increased extreme weather events and related challenges.
Some growing seasons shift, impacting ArborGen’s distribution cycles while changing regional climates require
ArborGen to relocate some orchards and nurseries. Adaptation methods are implemented for both ArborGen’s
infrastructure and processes, including modified growing methods and continued research into advanced
genetics to create seedlings better suited to the evolving climate. ArborGen invests in resilient materials for the
infrastructure of its orchards and nurseries to reduce the impact of extreme weather events. After 2050 physical
climate change impacts worsen.
Unlike farming and other industries in the primary industries sector, forestry incentivises jobs and the
desirability to work through its known contribution to the bioeconomy and carbon sequestration. This creates
greater opportunity for ArborGen to become an employer of choice and increases the supply of available labour
and labour flexibility to ArborGen.
Consumer behaviour shifts towards prioritising carbon sequestration as a positive mitigation for the transition
towards a low carbon world in the late 2030s. This increases demand from ArborGen’s customers for seedling
stock.

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The role of carbon sequestration and reforestation becomes prominent in attempts to stabilise carbon
emissions. To match this demand, ArborGen invests in technologies for developing genetically advanced
seedlings that maximise carbon sequestration. ArborGen experiences a significant uptake in sales to boost
forestry. The increasing necessity for resilience in trees sees ArborGen invest in technologies to strengthen the
adaptability of its seedlings.
Table 7: Hot house world scenario
End of century global
temperature outcome
Relative level of
physical impacts
Relative level of
transition impacts
SSP-RCP scenario
>3.0°C Moderate - High (by the
medium term) – High (in
the long term)
Low (with a slow but
steady increase over
time)
SSP3-7.0

The world continues with business as usual for the coming decades. Globally, an economic and social
development focus built on fossil-fuel intensive growth yields little climate regulation.
ArborGen is frequently impacted by extreme weather events including flooding, hurricanes, and drought, leading
to possible supply chain disruptions and changes in customer buying behavior. To cope with the severity of
events ArborGen invests in resilient materials for the infrastructure of its orchards and nurseries to reduce the
impact of extreme weather events. After 2050 physical climate change impacts worsen significantly.
Severe flooding events erode soil and ArborGen’s bare root seedlings are exposed, leading to damage.
Hurricanes and flooding drive ArborGen to diversify its locations across the US and Brazil to increase the
security of its stocks. Drought sees increasing restrictions on water and changes to soil composition which are
vital components for successful seedling growth. The conditions become increasingly favorable for pests and
pathogens.
The need for adaptation and resilient infrastructure re-builds sees an increase demand for building materials
including timber. ArborGen is a key player in this increase. Distribution times may be impacted by seedling
production and supply chain disruptions through climate-related events. Input costs associated with carbon are
likely to increase.
In the long term, access to labour is impacted as migrant workers are disrupted by extreme weather events and
the inability to travel. ArborGen’s Brazil operations rely on migrant workers, and productivity is negatively
impacted.
The frequency and severity of extreme weather events spotlights the advantage of genetics technology to
increase the adaptability of seedlings and trees to unfavorable conditions. The US government reconsiders its
stance on biotechnology in the forestry sector and creates incentives to financially sustain the sector.
ArborGen invests into technologies to both strengthen the resilience of its seedlings and increase the carbon
capture capacity, gaining a competitive advantage.
Impact assessment of climate-related risks and opportunities
The key climate issues and related physical and transition impacts for ArborGen are in table 8.
We will continue to monitor and consider these risks and opportunities as part of our internal capital
deployment and funding decisions. Climate related risks and risk mitigation is one of the criteria for capital
deployment and funding decisions as it is a key for risk mitigation. For example, we are currently reviewing
investments in key locations both in South America and the Southern US to ensure production is diversified
across the region. Additionally, ensuring production is split across a diverse area will mitigate not only weather-
related events, but also ensure supply chain risks are mitigated. All funding decisions are made by the ArborGen
leadership team, which includes the CEO, CFO, Vice President of Operations, and the Sales Director. All
investments are also taken to the Board for approval.

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Table 8: Impact assessment for ArborGen's climate-related transition, physical risks and
opportunities for FY24
Risk / opportunity Type Potential business impacts Risk rating
Weather related events
including excessive
sudden rain, freeze
events, drought
conditions, hurricanes
Physical risk
Climate-related risks and weather events
are material risks within ArborGen’s
existing Risk Management Framework.
The nature of ArborGen’s operations
make climate and weather an integral
part of its business operations across all
geographies. ArborGen's seedling
production cycle is highly dependent on
consistent weather, with extreme
weather events already causing
significant damage. Sudden heavy rainfall
within the first 4-6 weeks post-planting
can wash out seeds and damage
seedlings, while pre-lifting heavy rain
creates anaerobic conditions that harm
seedling roots. Freeze events before and
during lifting can cause root damage and
freeze events that occur during
pollination reduce annual seed volumes
and harvests.
Increased hurricane frequency leads to
large-scale damage to orchards and
nurseries, potentially necessitating
relocation. Higher temperatures cause
early seedling development, shortening
seasons and can affect the timing of
flower bagging - while hot, dry conditions
negatively impact seed germination.
Additionally, weather impacts also affect
ArborGen's critical infrastructure causing
delay and disruption to business
activities.
Short term Medium
Medium term High
Long term Very High
Climate change disrupts
supply chain including
labour
Physical and
transition risk
Climate change can significantly impact
ArborGen’s supply chain and labour
forces, primarily through extreme
weather events. Disruptions such as
flooding, and droughts can damage
infrastructure, delay transportation, and
interrupt production schedules, leading
to increased costs and inventory
shortages. There are periods of
production where ArborGen requires
increased labour levels, and there is a
likelihood of climate weather events
disrupting the flow of labour and
resources to orchards and nurseries
throughout the US and Brazil. For the
geographically isolated nurseries and
orchards, particularly those in Northern
Brazil, accessibility may be limited in the
case of extreme weather events
restricting supply. In Brazil, the already
limited window of planting could be
disrupted if the supply chain is
implicated, resulting in late deliveries to
key customers.
Short term Low
Medium term Low – Medium
Long term Medium

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Risk / opportunity Type Potential business impacts Risk rating

Failure to meet customer
and stakeholder
expectations regarding
climate risks and their
management
Transition risk
ArborGen has a responsibility to its
stakeholders and customers to uphold
their expectations when it comes to
climate risk and management. Failure to
meet these expectations could lead to
reduced investor confidence and
potentially lower stock valuations.
Inaction or ineffective action to take
steps to improve ArborGen’s climate
responsibility may also impact customer
perception of the brand and the
confidence they have in the ArborGen
product. Failure to comply with new and
developing climate regulations set in the
USA and Brazil, is likely to diminish
stakeholder confidence.
Short term Low
Medium term Low
Long term Medium
Introduction of industry-
related regulations and
other market complexities
influencing consumer and
customer demand
Transition risk
The demand for ArborGen’s seedlings
can change due to various factors,
including shifts in consumer preferences,
larger economic trends and regulatory
changes. The market for ArborGen
products may also face turbulent periods
in times of regulatory change in areas
aimed at biodiversity protections,
reducing deforestation and other
sustainability practices. ArborGen has
invested in the production of a core range
of seedlings, therefore, if regulations and
other factors were to cause shifts in
demand for those seedlings this would
require a significant change to
ArborGen’s business model. Increased
costs may also flow from a shift in
customer preference towards FSC
certified products. Increased costs will
be incurred in obtaining this certification
and maintaining it. Acute weather events
and chronic climatic changes, potentially
reducing supply, will have an impact on
general market demand and prices for
seedlings. Where the demand fluctuates,
there is a risk that ArborGen may not have
the required inventory levels.
Short term Low
Medium term Low
Long term Low

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Risk / opportunity Type Potential business impacts Risk rating

Increased demand for
advanced genetics
seedlings which have
greater resistance to
disease, weather and
pests
Opportunity There is an opportunity for ArborGen to
continue increasing investment into
research and development in its pursuit of
breeding seedling varieties with greater
resistance and adaptability to disease,
weather and pests. Product diversification
will help to protect ArborGen from any
potential changes in the market for its core
product offerings. There is potential to
partner with other projects and companies
to strategically increase investment into
R&D. Partnerships can also provide an
opportunity whereby partners can produce
ArborGen’s own genetic material – without
requiring a need for expanding ArborGen’s
own nurseries and orchards. As customer
demand and preferences for sustainable
products increases over time, there is an
opportunity to increase investment and
production of genetic material in seedlings
with enhanced carbon sequestration.
Short term Medium
Medium term Medium
Long term Medium - High
Increased customer
demand for seedlings
for afforestation and
reforestation
Opportunity As the market increasingly shifts towards
reforestation and afforestation projects
and sustainable materials, ArborGen could
obtain a greater market share and
enhanced competitive advantage for its
product. ArborGen can respond to
changing customer and consumer behavior
and preferences through its R&D
investment. There is an opportunity for
ArborGen to continue to actively engage
with carbon project developers who are
pursuing large scale afforestation and
reforestation projects in the Southern US
and Brazil. Currently, ArborGen has one
long term supply arrangement to provide
both advanced genetics pine seedlings and
hardwood seedlings. ArborGen should aim
to continue seeking out similar long-term
supply contracts.
Short term Low
Medium term Medium
Long term High
Financial incentives for
reforestation and
promoting sustainable
forest management
practices eg, carbon
credits
Opportunity
ArborGen will consider integrating
sustainability into its operations to access
a broader range of financing options,
including green bonds, sustainability-
linked loans, and impact investments.
These financial instruments often attract
investors who prioritise ESG
considerations, thereby diversifying
funding sources and potentially reducing
borrowing costs. In the US forestry
industry, financial incentive arrangements
geared towards sustainability measures
are currently allocated and targeted to not
for profits, but this could change over time.
There is an opportunity for private sector
companies like ArborGen to potentially
access more.
Short term Low
Medium term Low – Medium
Long term High

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Risk Management
To identify and assess risks, ArborGen draws on our internal forestry specialists, external consultants, and
current published scientific literature from various universities, USDA, EPA, NOAA, PNA and other National
Forestry related entities. Assessment of these risks is conducted on a quarterly basis.
We assess our risks across all aspects of our value chain using the following time-horizons:
Table 9 – Risk management time horizons
Time horizon Year Rationale
Short term 2024-2030 1-7 years, aligned with seedling production cycle
Medium term 2031-2040 7-15 years, reflecting seedling maturation and the
increasing uptake of advanced genetics in the market
across the US and Brazil forestry sector
Long term 2041-2050 >15 years

Our risk assessment process considers the likelihood of the risk occurring and the likely severity of its
consequences. Given the evolving impacts of climate change, ArborGen also assesses the vulnerability of the
business to gradual and progressive impacts. We consider the hazard, exposure to the hazard, and the
vulnerability of the system or process to the hazard.
Climate related risks are integrated into ArborGen’s Risk Management Framework. This means that climate
change risks are tested and prioritised using the same methodology as all other risks.
Management reports on these risks to the ARC and the Board on at least a quarterly basis, including for
incorporation into ArborGen's Risk Management Framework if necessary.
Key operational risks, including climate risks, form part of the annual risk management plan approved by the
Board.
Our Risk Management Framework implements risk mitigation procedures for climate risks including:
• the geographical spread of production,
• tiling and field topography improvements,
• SOPs for soil moisture and other types of controls,
• irrigation systems; and
• the use of nets and other equipment to combat weather issues.

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Metrics and Targets
ArborGen's greenhouse gas (GHG) inventory
ArborGen’s primary source of Scope 1 and 2 emissions is electricity use and transport fuel emissions
associated with orchard equipment and business travel. Because ArborGen is working on improving the
availability of quality data on its scope 3 emissions, we have chosen to rely on adoption relief provision 4 for our
first climate statement. We will include scope 3 emissions in our next reporting period.
Table 10: ArborGen's GHG emissions inventory
Scope Category FY23/24 tCO
2
-e
Scope 1: Direct emissions Gasoline 690.8
Diesel 990.2
Other 94.7
Subtotal 1,775.7
Scope 2: Indirect emissions
(location-based)
Electricity consumption
(purchased from the grid)
2,071.2
Subtotal 2,071.2
TOTAL Scope 1 and 2 emissions 3,846.9

GHG Emissions intensity metric
US$67,700,000/3,846.9 = US$17,416.62 of total sales revenue (from ArborGen's FY24 Annual Report and
Financial Statements) per tCO
2
-e (Scope 1 and Scope 2 as per the inventory above)
US$24,000,000/3,846.9 = US$6,238.78 of gross profit (from ArborGen's FY24 Annual Report and Financial
Statements) per tCO
2
-e (Scope 1 and Scope 2 as per the inventory above)
This inventory has been prepared in accordance with the Greenhouse Gas Protocol: A Corporate Accounting and
Reporting Standard 2004 (GHG Protocol), with guidance provided by Greenhouse Gas Protocol: Technical
Guidance for Calculating Scope 3 Emissions (version 1.0) (Technical Guidance) and reference to the emissions
and global warming potential factors in the Ministry for the Environment's 2023 Detailed Guide for Measuring
Emissions for Organisations (MfE Guide) and US EPA's GHG Emission Factors Hub (EPA).
ArborGen has applied the operational control consolidation approach to its GHG inventory. All emissions that
ArborGen has direct control over in its own head office in Ridgeville, South Carolina; nurseries, seed orchards,
distribution and research facilities located throughout Unites States, and Brazil are covered in this inventory.
Direct control is determined by ArborGen’s capacity to enact operational decisions for an emissions source. No
facilities or operations have been excluded from the report.
Assurance
The inventory has not been externally assured but will be from our second reporting period. ArborGen is not
required to have an GHG inventory undergoing external assurance for its first reporting period. However, with the
phasing in of Aotearoa New Zealand Climate Standards, external assurance will be required for reporting
periods ending after October 2024 .

15


Climate-related risks and opportunities metrics
Climate reporting within the forestry sector is still developing. We are not aware of industry-based metrics for
measuring and managing climate-related risks and opportunities beyond our GHG emissions. However, we are
monitoring developments in this space and will consider new metrics in future reporting years.
ArborGen has not yet set specific KPIs to measure and manage climate-related risks and opportunities. Our
current strategic pillars have many aspects of our business strategy which could be said to align with climate-
related risks, including relating to ArborGen's expansion in Brazil, optimising productivity, and a focus on
market-driven genetics in the future.
Climate related metrics are not currently incorporated into ArborGen's remuneration policies. The
Remuneration Committee will consider incorporating climate-related performance metrics for relevant roles, if
appropriate.
ArborGen has not yet developed an internal emissions price.
Assets vulnerable to transition risks
We consider that all of our facilities are vulnerable to the transition risks including supply chain disruptions to
varying degrees. In the absence of past and projected data relating to supply chain disruptions, ArborGen has
assessed the financial impact of reduced labour following the impacts of COVID-19. The estimation can be used
as a rough proxy to represent supply chain disruptions that may occur in the future due to climate-related
impacts. Our Riba di Rio Pardo nursery experienced a significant reduction in labour levels during COVID-19,
reducing production volumes by 10 million seedlings and increasing total cost of production. Therefore,
ArborGen's total lost sales equated to over US$613,000 (R$3.1 million) per year.
Assets aligned with climate-related opportunities
ArborGen's assessment of assets aligned with climate-related risks and opportunities reveals that
approximately 75% of our assets are aligned with climate-related risks. 50% of our intangible assets are aligned
with 50% of our opportunities. This is based upon the direct correlation of where are assets are located and the
exposure of risk they have related to climate events.
Capital expenditure deployed towards climate-related risks and opportunities
In light of this, ArborGen has devoted US$300,000 in 2024 for climate related capital expenditure. ArborGen is
continuously evaluating other assets for investment (within the US$1-4 million range) which will diversify risk by
moving production to multiple site locations. Further, in recognition of maintaining a competitive advantage by
developing superior proprietary genetics, ArborGen has invested approximately US$3.7 million in research and
development of which approximately 48% is associated with advanced genetic seedlings which have greater
resistance to disease, weather and pests. These dollars are associated with our R&D spend in the product
families with these specific trait characteristics.
ArborGen's metrics for managing its climate-related risks and opportunities
ArborGen is developing appropriate metrics for its climate-related risks and opportunities. We will continue that
development in FY25 and aim to have additional metrics for our second reporting period.

16


Physical risk exposure assessment
WSP New Zealand Ltd supported ArborGen with an exposure assessment
4
of ArborGen's sites impacted by the
physical risks of drought and flooding due to climate change. This work was not a physical risk assessment – the
vulnerability of ArborGen's sites was not assessed at this stage. Detail on the methods, assumptions and
limitations of the exposure assessment is set out in the Appendix to this report.
To identify ArborGen’s exposure to drought and flooding, a desktop assessment was conducted using climate
change adjusted data projections for flooding and drought risk. These data projections were analysed to assess
the number of ArborGen’s key assets (nurseries, partner nurseries) exposed across Southern United States (US)
and Brazil (31 sites total).
Four simplified maps have been prepared to visualise the areas exposed to drought and flooding. These maps
aim to identify where ArborGen’s most exposed sites are for two climate scenarios aligned with ArborGen’s
climate scenario analysis: ‘Too little, too late’ and ‘Hot house’. Each metric includes a brief description of the
methodology followed, key assumptions and limitations of the assessment for ArborGen to disclose.
ArborGen acknowledges that further maturity of this assessment is required to assess the vulnerability of assets
and business activities to climate hazards. We will look to complete a detailed physical climate risk assessment
for each of our sites, including considerations for our value chain such as key export lines.
Drought
The exposure assessment of ArborGen’s nurseries located in the US and Brazil to drought in 2050 utilised data
from the World Bank Group Climate Change Knowledge Portal. Exposure to drought is presented in ranges using
the Standardised Precipitation - Evapotranspiration Index (SPEI). The assessment has been conducted for two of
ArborGen’s scenarios: ’Too little, too late’ and ‘Hot house’. Data based on the IPCC’s Sixth Assessment
scenarios SSP2-4.5 and SSP3-7.0 was used for the ‘Too little, too late’ scenario and ‘Hot house’ scenarios
respectively.
The SPEI is a multiscalar drought index based on climatic data. It is used to determine the onset, duration and
severity of drought conditions compared to normal conditions. A higher SPEI index means decreased drought
conditions and a lower SPEI index means increased drought conditions.
The results provided here help ArborGen to better understand the projected future exposure of its nurseries to
drought in the geographies in which it operates.


4
Exposure is defined as: “The presence of people; livelihoods; species or ecosystems; environmental functions, services,
and resources; infrastructure; or economic, social, or cultural assets in places and settings that could be adversely
affected” (XRB Climate-related Disclosures Staff Guidance, pg. 25 in reference to IPCC, 2022 Full Report, p.43). Exposure is
one component of assessing physical climate risk. A physical climate risk assessment typically assesses both exposure and
vulnerability.

17



Table 11: Percentage of ArborGen's US sites exposed to SPEI drought index ranges
SPEI index
range
Too little, too late scenario*, 2050 Hot house scenario*, 2050
Number of US ArborGen
nurseries located in
range
Percentage (%) US
ArborGen nurseries
located in range
†

Number of US
ArborGen nurseries
located in range
Percentage (%)
US ArborGen
nurseries
located in
range
†

1 to 2 0 0% 0 0%
0 to 1 4 57% 4 57%
-1 to 0 3 43% 3 43%
-2 to -1 0 0% 0 0%
*Data based on SSP2-4.5 and SSP3-7.0 was used for the ‘Too little, too late’ and ‘Hot house’ scenarios respectively.
†Percentage (%) figures have been rounded to the nearest whole number.


Table 12: Percentage of ArborGen's Brazil sites exposed to SPEI drought index ranges
SPEI index
range
Too little, too late scenario*, 2050 Hot house scenario*, 2050

Number of Brazil
ArborGen nurseries
located in range
Percentage (%) Brazil
ArborGen nurseries
located in range
†

Number of Brazil
ArborGen nurseries
located in range
Percentage (%)
Brazil ArborGen
nurseries
located in
range
†

1 to 2 0 0% 0 0%
0 to 1 6 25% 6 25%
-1 to 0 18 75% 18 75%
-2 to -1 0 0% 0 0%
*Data based on SSP2-4.5 and SSP3-7.0 was used for the ‘Too little, too late’ and ‘Hot house’ scenarios respectively.
†Percentage (%) figures have been rounded to the nearest whole number.

18


Fluvial Flood
ArborGen’s exposure to fluvial (riverine) flood in 2050 was assessed using data from Aqueduct Floods. The
following tables indicate where ArborGen’s sites are potentially exposed. These are sites identified within the
flood plain of a 100-year return flooding event for either an RCP4.5 or RCP8.5 scenario.

Table 13: Percentage of ArborGen's US sites exposed to 1 in 100 year return period fluvial
flood event
Scenario Too little, too late scenario
†
, 2050 Hot house scenario
†
, 2050
Number of ArborGen nurseries
exposed to flood hazard*
1 of 7 1 of 7
Percentage (%) of ArborGen
nurseries exposed to flood
hazard*
14% 14%
*Calculated based on exposure to a 1 in 100 year return period fluvial (river) flood event.
†Data based on RCP4.5 and RCP8.5 was used for the ‘Too little, too late’ and ‘Hot house’ scenarios respectively.


Table 14: Percentage of ArborGen's Brazil sites exposed to 1 in 100 year return period
fluvial flood event
Scenario Too little, too late scenario
†
, 2050 Hot house scenario
†
, 2050
Number of ArborGen nurseries
exposed to flood hazard*
1 of 24 2 of 24
Percentage (%)‡ of ArborGen
nurseries exposed to flood
hazard*
4% 8%
*Calculated based on exposure to a 1 in 100 year return period fluvial (river) flood event.
†Data based on RCP4.5 and RCP8.5 was used for the ‘Too little, too late’ and ‘Hot house’ scenarios respectively.
‡Percentage (%) figures have been rounded to the nearest whole number.

19

20




Targets
ArborGen has not yet set climate-related targets in our first year of climate reporting.
We intend to set climate-related targets from FY25 and are considering the scope and basis of those targets,
including regarding energy use (electricity and gas), GHG emissions, waste reduction / recycling and reducing
water consumption at our sites.

21


Appendix:
Methods, assumptions and limitations
General
The exposure assessment was conducted out to 2050, as this is the endpoint for ArborGen’s climate scenarios.
ArborGen acknowledges that the most significant divergence in physical climate hazard exposure is projected to
occur towards the end of the century (post 2050). This explains why the difference in physical hazard exposure
between the ‘Too little, too late” scenario and the “Hot house” scenario for 2050 does not appear significant. An
assessment beyond 2050 would show a significant divergence in exposure between scenarios.
Within the limited timeframe to conduct the exposure study, the best available fluvial flood and drought data
was identified. ArborGen acknowledges that higher resolution data could exist at a subregional level and that it
intends to investigate the availability of such datasets for use in future assessments.
The assessment only covers ArborGen’s nurseries and partner nurseries. It does not cover any other aspects of
ArborGen’s value chain, such as export lines or customer locations.
Drought
Results of the drought exposure assessment have been presented using ranges (eg 0 to 1). The World Bank data
used for the assessment is of a higher resolution. The results have been simplified so they are easier to present
visually but still provide a useful output. This simplification means the maps do not show small differences (<1.0
SPEI index change) between the scenarios.
Fluvial flood
The assessment of flood exposure is limited to fluvial (riverine) flooding. It does not cover coastal flooding or
pluvial (rain) flooding. Coastal flooding was not covered since none of ArborGen’s nurseries or partner nurseries
are located near the coast. Pluvial flooding was not covered due to a lack of readily available, suitable data to
assess this hazard for the US or Brazil.
The assessment of fluvial flood exposure was conducted via a desktop assessment using visual inspection of
the Aqueduct Floods datasets to determine the exposure. No modelling or GIS spatial analysis was conducted.
ArborGen sites were deemed to be exposed to fluvial flooding if the site location overlapped with a flood depth
of any amount >0 decimetres.
Fluvial flood exposure has only been quantified for the 1 in 100-year flood frequency. The exposure results do
not show ArborGen’s maximum fluvial flood exposure. Some locations could be exposed to fluvial flood hazard
for return periods greater than 1 in 100 years under each climate scenario.
ArborGen acknowledges that the data used to assess fluvial flood exposure is based on the IPCC’s Fifth
Assessment scenarios: RCP4.5 and RCP8.5. Although these are not the latest IPCC scenarios, this was the best
flood data available given time constraints. Data based on the RCP scenarios is still appropriate for a high-level
exposure assessment.

22


Climate change disrupts to supply chain (including labour)
The method used to develop this metric began with analogising past events causing disruptions to ArborGen's
supply chain to infer the potential impact on business activities of a significant event in the economy. By
referring to COVID-19, ArborGen has selected an illustrative example of non-directly-climate-related supply
chain impact on its business. Analogising the impacts of COVID-19 on ArborGen’s supply chain to climate-
related impacts provides some information, but ArborGen recognises the uniqueness of the potential
disruptions of climate-weather related events which will not be transferrable from COVID-19. Understanding the
full extent of the financial impact of a supply chain disruption is complex as it is multifaceted issue, requiring
extensive data and financial reporting, as well as a deepened understanding of ArborGen’s supply chain and
how it operates. ArborGen acknowledges that more data and information may exist in relation to its supply
chain. We intend to mature our assessment in future reporting years for future assessments (ie for FY25
reporting) to include other aspects of the supply chain, such as logistics and distribution lines.
Opportunity metric (R&D)
R&D spend for genetic materials associated with traits in disease, weather and pests were pulled by product
families currently being developed with these genetic characteristics. These traits, regardless of climate change
issues, are the big three traits that are consistently sought after in the industry and by ArborGen’s customers.
Product families are developed that are more resistant to these traits over many generations of breeding and
advanced selection processes. Because these traits are largely sought after, the competitive advantages, the
associated spending for the trait selections and breeding and other key information associated with these traits
can be discerned from ArborGen’s annual R&D investments. It should be noted that specific trait
characteristics costs cannot be segregated easily if it is combined with other traits within one product family.
GHG emissions data collection, quantification and uncertainties
All GHG emissions data provided is captured by ArborGen’s finance and accounting team, in separate files for
US sites and for sites in Brazil. All emissions calculations were carried out in Microsoft Excel. The supplied
source data was multiplied using the relevant emissions factor. Unless otherwise stated, all emissions factors
were sourced from the EPA Emissions Hub 2024.
All measurements and data are based on supplier invoices and records housed in ArborGen’s finance and
administration system and are largely complete and reliable. Overall accuracy of the emissions profile depends
on:
a) how well the accounting codes reflect the nature of the activities they are designed to cover;
b) how consistently ArborGen’s finance and accounting team apply the accounting codes; and
c) how accurately and consistently the operational boundaries have been applied to the various accounting
codes.
Scope 3 data is more difficult to collect as it includes emission reporting for third parties, for transactions where
the emission source is not directly purchased by ArborGen or where the requirement is to capture emissions
associated with the use of a natural resource. Scope 3 emissions include business travel, third party freight
carriers, refrigerated vans leased by ArborGen and rented to our customers, water usage from wells, lakes, etc,
and waste generation. Most of the items in scope 3 will require that the emissions be extrapolated from a
measurement that can be used to estimate emissions. For business travel, we will use SAP Concur, which is our
travel and entertainment reporting software, to capture additional data related to expense reporting such as
mileage for transportation and number of nights purchased for accommodations. For logistics, we invoice van
rentals at a daily rate so we can capture days used. We will also track freight mileage through a combination of
spreadsheet documentation and/or requesting that freight vendors include mileage on their invoices. We also
currently track water usage at some of our sites and will need to investigate our options for putting meters on
other water sources where usage is not currently tracked. We are still trying to determine the best
measurements for waste which includes everything from office waste to MCP bags. Again, measurements will
vary with accounts payable transactions providing the most readily available data. Beyond that, we will look at
using the number of employees to extrapolate waste generation, bag counts to extrapolate MCP bag waste, etc.

23



Registered office
Suite 107, 100 Parnell Road,
Auckland 1052, New Zealand
PO Box 68 249, Victoria Street West,
Auckland 1141, New Zealand
Telephone: +64 9 356 9800

Email: info@arborgenholdings.com


Website
www.arborgenholdings.com