Message FNV: TSX | NYSE from our CEO Approach to Climate Change ESG Ratings Climate Opportunities Franco-Nevada As a royalty and streaming company, we are well positioned to participate in climate-related opportunities arising in connection with the transition to a low-carbon economy. The following describes climate-related opportunities that we have already embraced in our portfolio and that we expect will continue to be available to our company in the short, medium and long-term. Making Responsible Products and Services Investments Our investments in commodities used for low emission products and services may increase revenues and bring competitive advantage due to the increased demand for such products and services from shifting consumer preferences. Guiding Principles Copper: Natural Gas: With superior electrical and thermal The use of natural gas for energy results conductivity, copper will play a in fewer emissions of nearly all types significant role in enhancing energy of air pollutants and carbon dioxide than Operators efficiency and decarbonizing the planet. burning coal or petroleum products. For A 2017 World Bank Report* counted this reason, while there are undeniably dozens of metals which could see more emissions produced than clean Approach to a growing market with the increasing energy sources, natural gas is viewed Climate Change reliance on renewable and sustainable by some as a “bridge” fuel as renewable energy sources. Copper ranked first energy sources become increasingly (tied with aluminum and nickel) among more cost-effective and prevalent. In all metals for its prevalence in low- developing regions, natural gas is Contributions carbon technologies, including in wind, solar photovoltaic, carbon capture and replacing wood and coal used for heating and cooking, which will improve health storage, nuclear power, light emitting diodes, electric vehicles and electric motors. conditions. In developed countries, efficient distributed natural gas-fired combined heat and power systems will reduce emissions. Our company’s principal sources of revenue are from copper mines, including Employees our four core assets (Cobre Panama, Antapaccay, Antamina and Candelaria) where Our company’s recent additions to our energy portfolio has seen a shift from we receive precious metal by-products from copper concentrates and, in 2021, U.S. oil to natural gas plays, including our 2019 royalty acquisition on Range we acquired another precious metal stream from the Condestable copper mine Resources liquids-rich natural gas properties in the Marcellus shale in Pennsylvania Governance in Peru. Strong demand for copper increases the prospects of greater production and our 2020 royalty portfolio acquisition in the Haynesville shale, Texas, one of from these operations. We also have royalties on a number of prospective copper the most active gas plays in North America. Natural gas accounted for approximately development projects, including Rosemont and Copper World (Hudbay), Alpala 38% of our energy revenues in 2021, a significant increase from prior years. (SolGold), Taca-Taca (First Quantum) and NuevaUnión (Teck and Newmont) About this projects. We expect that in the future there will be further opportunities for our ESG Report company to finance copper operations given the metal’s utility in the transition to a low-carbon economy. * “The Growing Role of Minerals and Metals for a Low-carbon Future”, World Bank Group, June 2017. Appendices 36