Sociedad Quimica y Minera S.A.
Annual Report 2022

Plain-text annual report

TABLE OF CONTENT 1. MESSAGE FROM THE CEO OF THE COMPANY 2. COMPANY PROFILE 2.1 MISSION, VISION, PURPOSE AND VALUES 2.2 HISTORICAL INFORMATION 2.3 OWNERSHIP AND SHARES 3. OUR CORPORATE GOVERNANCE 3.1 CORPORATE GOVERNANCE FRAMEWORK 3.2 BOARD OF DIRECTORS 3.3 BOARD COMMITTEES 3.4 MAIN EXECUTIVES 3.5 ADHERENCE TO NATIONAL AND INTERNATIONAL CODES 3.6 RISK MANAGEMENT 3.7 RELATIONSHIP WITH STAKEHOLDERS AND THE GENERAL PUBLIC 4. STRATEGY 4.1 TIME HORIZONS 4.2 STRATEGIC OBJECTIVES 4.3 CAPITAL EXPENDITURE PLANS 5. OUR PEOPLE 5.1 LABOR ENDOWMENT 5.2 TYPES OF EMPLOYMENT CONTRACTS 5.3 WORKING HOURS 5.4 WAGE EQUITY 5.5 WORKPLACE AND SEXUAL HARASSMENT 5.6 OCCUPATIONAL SAFETY 5.7 POSTNATAL LEAVE 5.8 TRAINING AND BENEFITS 5.9 SUBCONTRACTING POLICY 6. OUR BUSINESS 6.1 INDUSTRIAL SECTOR 6.2 BUSINESS LINES 6.3 STAKEHOLDER GROUPS 6.4 PROPERTY, RESERVES AND FACILITIES 4 7 7 9 11 19 19 23 33 36 38 38 43 46 47 47 53 55 56 60 62 63 64 64 66 68 71 74 74 81 92 95 6.5 SUBSIDIARIES AND ASSOCIATES 7. SUPPLIERS MANAGEMENT 7.1 PAYMENT TO SUPPLIERS 7.2 EVALUATION OF SUPPLIERS 8. INDICATORS 8.1 LEGAL AND REGULATORY COMPLIANCE 8.2 SUSTAINABILITY INDICATORS BY INDUSTRY 9. ESSENTIAL OR RELEVANT FACTS 126 127 127 128 132 132 136 171 10. COMMENTS FROM SHAREHOLDERS AND THE DIRECTORS' COMMITTEE 173 11. FINANCIAL REPORTS ANNEX ANNEX 1. RISK FACTORS ANNEX 2. SUBSIDIARIES AND ASSOCIATES 173 174 174 195 1. MESSAGE FROM THE CEO OF THE COMPANY Dear employees, shareholders, customers, communities, collaborators, and stakeholders in general, I would like to present SQM's 2022 Annual Report. This has been a record year in the Company's history, due to several aspects mentioned below. In 2022, we achieved the highest revenues in SQM's history, reaching US$10.711 billion, and we were the largest contributor to the country's tax coffers, contributing over US$5 billion. All of this is the result of our long-term vision, the new capacity investments we have made, our operational success, and the responsible and sustainable use of our resources. As for our business lines, for lithium, in 2022 we worked at maximum capacity with 180,000 tons of lithium carbonate and 30,000 tons of lithium hydroxide to meet the needs of the market, which is making great strides towards the energy transition. Lithium is an essential part of this transformation, contributing to the development of electromobility, the decarbonization of the planet, and a more sustainable future. During the year, we also announced expansion plans that will increase our capacity to 210,000 tons of lithium carbonate by 2023 and 100,000 tons of lithium hydroxide by 2025. At the same time, we are making smooth progress at our Mt. Holland project in Australia, together with our partner Wesfarmers, to start producing spodumene concentrate by the end of 2023 and lithium hydroxide by the first semester of 2025. Another important milestone is that we acquired our first refining plant outside of Chile to produce lithium hydroxide in China from lithium sulfate sourced from our Salar de Atacama operation. Our Iodine and Derivatives business line reached record highs in terms of production volumes and sales prices, driven by a healthy demand mainly due to the use of iodine in contrast media for the X-ray industry, and we announced a US$1.2 billion investment for the 2023-2025 period to increase iodine and nitrate production capacity. As a result of fertilizer shortages and supply chain disruptions, our Specialty Plant Nutrition and Potassium business lines experienced significantly higher average sales prices than in 2021. We also saw the total market demand for these products contract, resulting in a decrease in our sales volumes. We expect a recovery in demand by 2023, and we are convinced that the need for agricultural solutions that increase yields and reduce the need for water will increase, favoring the consumption of our specialty fertilizers. Sustainability is an essential part of our business strategy and is embedded in all of SQM's activities and projects. We measure and mitigate our carbon, water, and environmental footprints. Today, we maintain an open-door policy and direct communication channels with the communities surrounding our operations in the Tarapacá and Antofagasta regions, as well as sustained and joint work to contribute to the development of their life plans. Our Salar de Atacama operation has one of the lowest carbon footprints on the planet and our Sustainable Development Plan, presented in 2020, challenges us to further meet the targets we set for 2025, 2030, and 2040, which can be seen in detail in this Annual Report, our website, Sustainability Report, and social media. In 2022, we announced the Salar Futuro project, which deepens our commitment to developing a sustainable, high value-added lithium industry in Chile. This project involves important technological MESSAGE FROM THE CEO OF THE COMPANY 4 challenges and direct investments of more than US$1.5 billion that will allow us to have the most sustainable mining operation in the world and reduce our emissions and footprint beyond our previous goals through innovation, research, and the application of new technologies such as Advanced Evaporation Technologies (AET), Direct Lithium Extraction (DLE), increased yields, and seawater use. As part of our sustainability initiatives, in 2022 we continued with the IRMA (Initiative for Responsible Mining Assurance) certification process and completed phase 2 of the certification audit at the Salar de Atacama operation, for which we expect to receive the final report in the coming months. In 2022, we participated in the evaluation of the Dow Jones Sustainability Index (DJSI); we were accepted in the MILA and Chile indices for the third consecutive year, and we were included in the Sustainability Yearbook 2023. We were also evaluated in the Carbon Disclosure Project (CDP), where we obtained a B category, i.e. in the management band above the average of the South American region (C) and above the average of the Chemicals sector (-B). We also completed phase 2 of the ISO 14001 and 45001 certification process at the Salar de Atacama and Carmen lithium chemical plants and continued with the process of implementing ISO 50001 at Salar de Atacama and Nueva Victoria to support the decarbonization targets for energy management systems. Finally, and in line with the Company's social commitment to the people living in the territories where we operate, we participated, among other things, in 34 working groups to increase our interaction with the communities and we also created the Atacameña Women's Alliance (Alianza Mujer Atacameña, AMA) to carry out a series of actions aimed at strengthening the role of women. We are also continuing to implement different programs that we have been working on for years, such as "Health and Healthy Life", which offers preventive exams to detect breast cancer, medical specialties, and free dental care through our mobile dental clinics in San Pedro de Atacama, Toconao, Peine, Socaire, and Talabre; "Agriculture, Water Conservation, and Land", which seeks the diligent use and care of natural resources; "Productive Development and Trade", to explore new ways to add value to our products, empower entrepreneurs and businesswomen, and coordinate strategies with other public or private organizations; and "Cultural Heritage and the Environment", which promotes the maintenance, care, and enhancement of the Lickanantay culture and the historical inhabitants of Tarapacá. In terms of gender equity, at SQM we are committed to encouraging the incorporation of women into chemical and mining activities by strengthening the Company's links with technical-vocational high schools, technical training centers, and universities, to encourage women to pursue STEM careers so that they can become professionals in the specialties required by the mining industry. We are also proud that in 2022, 20% of SQM's employees were women, recognized as the highest in the industry by the Impulsa award, and that we obtained the Standard 3262 Certification for Gender Equality and Work-Life Balance in the Metropolitan Region. We are already working to achieve this seal in Antofagasta and Tarapacá as well. Finally, I would like to thank our employees and stakeholders for their support, since each of them, in their own capacity, contributes towards SQM's efforts to improve people's quality of life by providing solutions for human progress. With my warmest regards, Ricardo Ramos Rodríguez CEO MESSAGE FROM THE CEO OF THE COMPANY 5 SQM IN NUMBERS SQM is a global chemical company that is listed on the New York Stock Exchange and the Santiago Stock Exchange (NYSE: SQM; Santiago Stock Exchange: SQM-B, SQM-A). SQM develops and produces diverse products for several industries essential for human progress, such as health, nutrition, renewable energy and technology through innovation and technological development. We aim to maintain our leading world position in the lithium, potassium nitrate, iodine and thermo-solar salts markets. Through the specialized international commercial network, SQM reaches more than 110 countries with its products with 98% of its total sales during 2022 coming from export. TOTAL REVENUE NET INCOME US$10,710.6 million US$3,906.3 million CONTIRNUTION TO CHILEAN TREASURY US$5,000 million 6,997 employees IN CHILE AND GLOBALLY 20% of employees ARE WOMEN US$885 million SPENT ON TRAINING PROGRAMS MENSAJE DEL GERENTE GENERAL DE LA COMPAÑÍA 6 2. COMPANY PROFILE 2.1 MISSION, VISION, PURPOSE AND VALUES The following corporate principles guide SQM's actions and are continuously indorsed in the interactions with all of our stakeholders. Mission We are a global company with a team of people committed to excellence. Our activities focus on the extraction of minerals that can be selectively integrated into the processing and sale of products for industries essential for human development. Vision We are a global company that is recognized for its competitiveness, excellence and innovation in its lines of business. We focus on the development of products essential for human development in accordance with the highest standards of integrity. Purpose We aspire to make a distinctive contribution to the world's sustainable development, delivering solutions for industries essential to human progress, in harmony with our environment and our people. Values Excellence ▪ We are an organization that challenges itself permanently to achieve better results every time, with the purpose of creating shared value for shareholders, collaborators, clients, suppliers and communities. ▪ In our daily work and challenges we face, we strive to be creative, agile and innovative. ▪ We operate within a framework of sustainability and respect for the environment. ▪ We aim at creating an organization culture of excellence based on the ten principles of the Lean methodology (M1). ▪ We encourage and value internal meritocracy as the main way of professional growth, favoring equal opportunities, inclusion and diversity. We seek to generate professional growth opportunities for people to reach their maximum potential. Security ▪ Caring for people is an organizational priority commitment that mobilizes us daily, working towards safe and accident-free operations. ▪ We are responsible for creating the conditions for the safe development of each job; as well as promoting behaviors focusing on the physical and psychological safety of all people who work at SQM. ▪ Each person in the organization is responsible for taking care of themselves and looking out for the other members of the team, as well as maintaining a mandatory safe behavior commitment. We promote open and permanent feedback to make safety improvement opportunities visible. 2 COMPANY PROFILE 7 Integrity ▪ We seek to carry out our daily work with high standards of integrity described in the internal Code of Ethics. At the same time, we are open and interested in identifying and implementing better ways of working that ensure and facilitate compliance with these standards. ▪ We encourage respect for and compliance with each of the commitments assumed with shareholders, clients, collaborators, regulators, communities, suppliers and authorities. Sustainability ▪ A voluntary commitment that envisions a future where SQM becomes a relevant actor in a cultural change, contributing to the sustainability of the planet that we all want and dream of, and doing it not only through the contribution that its products make to health, food, green energies and technology, but also through the sustainability of its supply chain. ▪ Sustainability leads us to rethink our processes, activities and operation to materialize concrete actions. SQM, as a company with a global reach, understands the responsibility that its work entails and aims at the continuity of its business in the long term. For this reason, since its inception the Company has been committed to sustainable development in harmony with its environment, business ethics and respect for and promotion of human rights, in accordance with current national and international standards. With the goal of consolidating these commitments from the highest corporate level and throughout the entire operational chain, in 2021, the Company published its Sustainability, Ethics and Human Rights Policy, based on the United Nations Sustainable Development Goals (SDGs); the Principles of the International Council on Mining and Metals; the International Standard ISO 14001 (Environmental Management Systems); the applicable standards of the International Finance Corporation (IFC) and the framework of "Protection, Respect and Remediation" of the Guiding Principles on Business and Human Rights of the United Nations, inspired by the Universal Declaration of Human Rights, Convention 169 on Indigenous and Tribal Peoples of the International Labor Organization, among other guidelines. SQM's Sustainability, Ethics and Human Rights policy is available at: https://www.sqm.com/en/politica- de-sostenibilidad-etica-y-derechos-humanos/ and considers all areas of the company and business, such as: Ethics and Corporate Governance; Employees; Value chain; Environment and Sustainable Development and Communities. 2 COMPANY PROFILE 8 2.2 HISTORICAL INFORMATION Below are the milestones in the company's history: 1968: SQM was formed through a joint venture between Compañía Salitrera Anglo Lautaro S.A. (“Anglo Lautaro”) and the Production Development Corporation (Corporación de Fomento de la Producción or “Corfo”), a Chilean government entity. 1971: Anglo Lautaro sold all its shares to Corfo and SQM was wholly owned by the Chile Government. 1983: Corfo began a process of privatization by selling our shares to the public and subsequently listing such shares on the Santiago Stock Exchange. 1985: SQM began to use heap leaching processes to extract nitrates and iodine. 1986: The potassium nitrate production commenced at the Coya Sur facility. 1988: The company's privatization process concluded with all the shares publicly owned. 1993: SQM´s ADSs started to trade on the NYSE under the ticker symbol “SQM”. Each ADS represents one Series B common share. 1994: Investments into the development of the Salar de Atacama project in northern Chile began, which enabled us to produce potassium chloride, lithium carbonate, potassium sulfate and boric acid. 1996: Production of lithium carbonate began at the Carmen Lithium Chemical Plant, near the city of Antofagasta. 2005: Lithium hydroxide production began at the Carmen Lithium Chemical Plant. 2011: The expansions of lithium carbonate capacity were completed, achieving 48,000 metric tons of capacity per year. During this year, the construction of a new potassium nitrate facility in Coya Sur was completed, increasing the overall production capacity of potassium nitrate by 300,000 metric tons per year. 2013: The expansions in the production capacity of iodine plants in Nueva Victoria were completed. 2015: Focusing on increasing the efficiency of our operations, the Company announced a plan to restructure the iodine and nitrate operations. 2017: The iodine production capacity at Nueva Victoria was increased to approximately 10,000 metric tons per year. Including Pedro de Valdivia and Nueva Victoria, the total effective iodine capacity reached approximately 14,000 metric tons per year. This year, SQM entered a 50/50 joint venture with Wesfarmers Limited to develop a Mt. Holland lithium hydroxide project in Western Australia. The project includes design, construction and operation of a mine, concentrator and refinery for the production of lithium hydroxide with total capacity of 50,000 metric tons. 2 COMPANY PROFILE 9 2020: SQM announced the Sustainable Development Plan, which included voluntarily expanding monitoring systems, promoting better and more meaningful conversations with neighboring communities, becoming carbon neutral and reducing water by 65% and brine extraction by 50%. As part of this plan, the company also set a goal to obtain international certifications and participate in international sustainability indices, and for the first time entering the Dow Jones Sustainability Chile and the Dow Jones Sustainability MILA Pacific Alliance Indices. 2021: The Board approved the investment of approximately US$700 million for the 50% share of the development costs of the Mt. Holland lithium hydroxide project in Western Australia. The Company completed the US$1.1 billion capital increase. 2022: SQM was included in the Dow Jones Sustainability Chile and the Dow Jones Sustainability MILA Pacific Alliance Indices for the third year in a row. SQM es incluida en los índices Dow Jones Sustainability Chile y Dow Jones Sustainability Mila Pacific Alliance, por tercer año consecutivo. In addition, during this period the external audit was completed in IRMA's rigorous responsible mining certification process. This year, the production of lithium carbonate in SQM's local operation reached an effective capacity of 180,000 metric tons. During 2023, the Company expects to increase it to reach 210,000 metric tons and 40,000 metric tons of lithium carbonate and lithium hydroxide capacity, respectively, with latter reaching 100,000 metric tons by 2025. In addition, the purchase and development of a new plant in China is announced, which will allow the company to produce up to 30,000 metric tons of lithium hydroxide per year from lithium sulfate coming from Chile. In the third quarter of this year, SQM announced plans related to the Salar Futuro project, deepening its commitment to the development of a sustainable lithium industry in Chile. This project entails important technological challenges and investments of more than US$1.5 billion, which will make it possible to have the most sustainable mining operation in the world and reduce the footprint beyond the previously established objectives, based on innovation, new technologies, such as Advanced Evaporation Technologies (AET), Direct Lithium Extraction (DLE), yield improvements and use of seawater. 2 COMPANY PROFILE 10 2.3 OWNERSHIP AND SHARES 2.3.1 Ownership control situation As of December 31, 2022, SQM does not have a “controlling group” as such term is defined in Title XV of Chilean Law No. 18,045. 2.3.2 Significant changes in share ownership During 2022, there have been no significant changes in the ownership or control of the Company. 2.3.3 Identification of major shareholders The following chart represents the ownership and major shareholder groups as of December 31, 2022. STOCK BROKERS, 2.79% OTHERS, 2.40% BANKS FOR FOREIGN ACCOUNTS, 11.51% PAMPA GROUP, 25.76% CHILEAN PENSION FUNDS, 10.58% THE BANK OF NEW YORK MELLON (ADRS), 22.60% KOWA GROUP, 2.20% INVERSIONES TLC SPA (TIANQI LITHIUM), 22.16% 2 COMPANY PROFILE 11 As of December 31, 2022, the following shareholders own more than 1% of the Company's shares, and/or can appoint at least one member to the Company's Board of Directors. SOCIEDAD DE INVERSIONES PAMPA CALICHERA S.A. Company Name Chilean Tax ID 96.511.530-7 N° of Series A shares 44,989,231 N° of Series B shares 1,611,227 N° of Series A + Series B shares 46.600.458 POTASIOS DE CHILE S.A. 76.165.311-3 18,179,147 INVERSIONES GLOBAL MINING CHILE LTDA 96.863.960-9 8,798,539 - - Subtotal PAMPA GROUP THE BANK OF NEW YORK MELLON ADRS1 INVERSIONES TLC SPA2 71,966,917 1,611,227 59.030.820-K - 64,555,045 76.902.021-7 62,556,568 INVERSIONES LA ESPERANZA CHILE LIMITADA 79.798.650-K 4,246,226 KOCHI S.A. KOWA CO. LTD KOWA HOLDINGS AMERICA INC. Subtotal KOWA GROUP BANCO DE CHILE POR CUENTA DE STATE STREET AFP HABITAT 96.518.570-4 1,014,860 59.046.730-8 59.023.690-K 97.004.000-5 98.000.100-8 781,429 227,550 6,270,065 79,265 - BANCO SANTANDER POR CUENTA DE INV EXTRANJEROS 97.036.000-K 545,729 AFP CUPRUM BANCO DE CHILE POR CUENTA DE TERCEROS NO RESIDENTES AFP CAPITAL AFP PROVIDA BANCO DE CHILE POR CUENTA DE CITI NA NEW YORK CLIENT 76.240.079-0 97.004.000-5 98.000.000-1 76.265.736-8 97.004.000-5 - 62,829 - - 67,463 Subtotal Major Sahreholders Total Shares 141.548.836 123,391,110 264,939,946 92,75% 142.819.552 142,818,904 285,638,456 100,00% 1 The Bank of New York Mellon is the depositary bank for the Company’s ADSs traded on the New York Stock Exchange. Information about ADS holders is provided at the end of this section. 2 The number of shares does not include 748,490 ADRs of Tianqi Lithium Corporation. 2 COMPANY PROFILE 12 18.179.147 8.798.539 73.578.144 64.555.045 62.556.568 4.246.226 1.014.860 781.429 227.550 6.270.065 - - - - - - 10,979,388 11.058.653 9,504,885 8,181,775 6,535,039 6,181,476 5,652,982 5,263,361 4,925,932 9.504.885 8.727.504 6.535.039 6.244.305 5.652.982 5.263.361 4.993.395 % Ownership 16.31% 6.36% 3.08% 25.76% 22.60% 21.90% 1.49% 0.36% 0.27% 0.08% 2.20% 3.87% 3.33% 3.06% 2.29% 2.19% 1.98% 1.84% 1.75% 2.3.4 Shares and their characteristics and rights Description of series of shares The Company's capital is US$1,577,385,979 and divided in 142,819,552 Series A shares and 142,819,552 Series B shares. All these shares are registered, have no par value, and are issued, subscribed and paid. Article 5 of the Company's By-laws establishes that Series B shares have a restricted right to vote as they can only elect one Director of the Company, regardless of their capital stock’s share, and have the right to : (a) 5% of the Series B shares request so; and call for an Ordinary or Extraordinary Shareholders’ Meeting when the shareholders of at least (b) when it is requested by the Director elected by the shareholders of the Series B shares. call for an Extraordinary Board of Directors Meeting without the Chairman’s authorization The limitation and preferences of the Series B shares have a duration of 50 consecutive and continuous years starting as of June 3, 1993. Series A shares have the option to exclude the Director elected by Series B shareholders from the voting process in which the Chairman of the Board is to be elected, if there is a tie in the first voting process. The limitation and preferences of the Series A shares have a duration of 50 consecutive and continuous years starting as of June 3, 1993. The second transitory article and articles 31 and 31 bis of the Company’s By-laws establish that in General Shareholders’ Meetings each shareholder will have a right to one vote for each share he owns or represents and (a) that no shareholder will have the right to vote for himself or on behalf of other shareholders of the same Series A or Series B shares representing more than 37.5% of the total outstanding shares with right to vote of each Series and (b) that no shareholder will have the right to vote for himself or on behalf of other shareholders representing more than 32% of the total outstanding shares with a right to vote. In calculating a single shareholder’s ownership of Series A or B shares, the shareholder’s stock and those pertaining to third parties related to them are to be added. The second transitory article provides as follows: “Throughout the period running from the date of the extraordinary shareholders’ meeting at which this transitory article is incorporated, and December 31, 2030, the restriction against voting on behalf of more than 37.5% of any series of shares in the Company, established in Article 31 hereof, shall be subject to the following exception, applicable only to the election of board members by means of Series A shares in the Company: If two or more persons, regardless of whether or not they are related parties to each other (the incoming shareholders), act prior to December 31, 2030 such as to acquire a sufficient number of Series A shares to allow them to hold voting powers for the selection of directors of the Company amounting to more than 37.5% of that series, then any registered shareholder or group of shareholders holding more than 37.5% of all Series A shares in the Company shall be entitled to vote for the selection of directors of the Company amounting to whichever is less, between a number of the Series A shares that are held (i) by existing shareholders as of that date, and (ii) by the incoming shareholders with voting rights. 2 COMPANY PROFILE 13 Similarly, if for any reason a registered shareholder in the Company as of the date hereof who holds more than 37.5% of Series A shares in the company between the date hereof and December 31, 2030, comes to hold more voting shares for the selection of directors of the Company than the votes allocated for holding 37.5% of said Series A shares, either through a joint action agreement with other shareholders, including existing shareholders, or by any other means, then any other shareholder or group of shareholders in the Company that is not a related party to the same and holds more than 37.5% of all voting Series A shares in the Company, including both existing and incoming shareholders, shall be entitled to vote for the selection of directors of the Company in accordance with whichever number of Series A shares in the Company is the lesser, between (i) the number held by this shareholder or group of shareholders, and (ii) the existing shareholder may have the capacity to vote in excess of the restriction amounting to 37.5% of said shares.” Article 5 bis of the Company's By-laws establishes that no person can directly or through third parties, state owned companies, decentralized, autonomous, municipal or other institutions, hold more than 32% of the Company’s total shares with right to vote. Each Series A share and Series B share is entitled to share equally in the Company’s profits, i.e., they have the same rights on any dividends declared on the outstanding shares of SQM. The Company By-laws do not contain any provision relating to (a) redemption provisions (b) sinking funds or (c) liability to capital calls by the Company. As established in article 103 of Law No. 18,046, a company subject to the supervision of the SVS may be liquidated in the following cases: • Expiration of the duration term, if any, as established in its By-laws; • All the shares end up in the possession of one individual for more than ten continuous days; • By agreement of an Extraordinary Shareholders Meeting; • By abolition, pursuant to applicable laws, of the decree that authorized its existence; • Any other reason contemplated in its By-laws. Article 40 of the Company’s By-laws states that in the event of liquidation, the Shareholders’ Meeting will appoint a three-member receiver committee that will have the authority to carry out the liquidation process. Any surplus will be distributed equally among the shareholders. The only way to change the rights of the holders of the SQM shares, including holders of our ADSs, is by modifying its By-laws, which can only be carried out by an Extraordinary Shareholders’ Meeting, as established in article 28 of the Company By-laws. 2 COMPANY PROFILE 14 Dividend Policy Dividends are annually distributed to the Series A and Series B shareholders of record on the fifth business day prior to the date for payment of the dividends. The By-laws do not specify a time limit after which dividend entitlement elapses but Chilean regulations establish that after 5 years, unclaimed dividends are to be donated to the Chilean Fire Department. SQM’s dividend policy for 2022, reported at the Annual General Shareholders’ Meeting held on April 26, 2022, included the following: distribute and pay, as a final dividend (dividendo definitivo) to the corresponding shareholders, a percentage of the net income that shall be determined per the following financial parameters: Dividend Payment (% of the 2022 Net Income) 100% 80% 60% “Total Current Assets” / “Total Financial Liabilities” ≥ 2.5 "Total current and non/current liabilities −Cash and cash equivalents −Other current financial assets"/ “Total equity” ≤ 0.8 2.0 0.9 1.5 1.0 If none of the foregoing financial parameters are met, the Company shall distribute and pay, as a final dividend, and in favor of the respective shareholders, 50% of the 2022 net income. b) Distribute and pay, if possible and during 2022, interim dividends (dividendos provisorios) that will be charged against the aforementioned final dividend. (c) The amount of the interim dividends may vary up or down, pursuant to the information available to the Board of Directors on the date on which it agrees to the distribution of said dividends given that the dividend will not materially or negatively affect SQM’s ability to make its investments, fulfill its liabilities, or in general, comply with the investment and finance policy approved at the ordinary general shareholders’ meeting. (d) At the ordinary general shareholders’ meeting that will be held in 2023, the Board of Directors shall propose a final dividend pursuant to the financial parameters expressed in letter a) above, discounting the total amount of the interim dividends previously distributed during 2022. (e) If there is an excess of net income in 2022, this may be retained and assigned or allocated for financing its own operations, to one or more investment projects of the Company, notwithstanding a possible distribution of special dividends (dividendos eventuales) charged to the retained earnings and approved at the shareholders’ meeting, or the possible and future capitalization of all or part of the latter. (f) The payment of additional dividends (dividendos adicionales) is not considered. 2 COMPANY PROFILE 15 Statistical information: dividends All series A and series B shares carry equal rights to share in any dividend declared on SQM’s shareholder capital in circulation. During the past three years, the Company has paid out the following dividends: Payout Year Earnings for the Year US$ Total (in millions) US$/Share 2020 (Final) 2020 (Interim) 2020 (Special) 2021 (Final) 2021 (Interim) 2021 (Interim) 2021 (Special) 2022 (Final) 2022 (Interim) 2022 (Interim) 2022 (Interim) 2019 2020 retained 2020 2021 2021 retained 2021 2022 2022 2022 66.9 45.0 100.0 4.4 68.0 89.8 400.0 27.7 796.1 528.2 879.9 0.25414 0.17092 0.37994 0.01530 0.23797 0.31439 1.40037 0.09691 2.78716 1.84914 3.08057 2 COMPANY PROFILE 16 Statistical information: share transactions SQM’s Series A and Series B shares are traded on the Santiago Stock Exchange and the Santiago Electronic Stock Exchange. The Company’s Series B shares have been traded as ADSs on the New York Stock Exchange since September 20, 1993. Information on SQM’s shares on Chilean stock exchanges: Average Price (Ch$/Share) SQM-A 67,393 54,517 68,884 74,524 71,645 SQM-B 73,851 51,323 73,834 87,359 82,888 Number of Shares Traded SQM-A 14,974,322 14,444,872 168,590 246,535 114,325 SQM-B 118,189,858 29,672,770 35,630,778 25,140,711 27,745,599 2022 I Quarter II Quarter III Quarter IV Quarter Fuente: Bloomberg, Composite Exchange Amount Traded (Millions of Ch$) SQM-A 825,668 787,491 11,613 18,373 8,191 2022 I Quarter II Quarter III Quarter IV Quarter Average Price (US$/ADS) SQM-B 83.83 63.67 87.81 94.55 89.31 Number of Shares Traded SQM-B 433,388,816 99,534,992 125,790,310 102,195,839 105,867,675 Fuente: Bloomberg, Composite Exchange Statistical information: number of shareholders The following table details the total number of SQM shareholders as of December 31, 2022: Número Total de Accionistas Series A y B Número Total de Accionistas Serie A Número Total de Accionistas Serie B 1.158 360 1.068 135 - 135 Registro de Accionistas Registro de Tenedores de ADSs 2 COMPANY PROFILE SQM-B 8,649,703 1,522,896 2,630,763 2,196,267 2,299,777 Amount Traded (Millions of Ch$) SQM-B 36,501 6,337 11,046 9,663 9,455 Total 1.293 360 1.203 17 2.3.5 Other Securities The Company has issued securities other than shares that correspond to different types of bonds placed in national and international markets to finance its activities and businesses. The following table sets forth key information about other securities issued by the Company as of December 31, 2022. Security (1) 3.63% Notes due 2023 — US$300 million 4.38% Notes due 2025 — US$250 million 4.25% Notes due 2029 — US$450 million 4.25% Notes due 2050 — US$400 million 3.50% Notes due 2051 — US$700 million (Green Bond) Series H Bond — UF 4 million Series O Bond — UF 1.5 million Series P Bond — UF 3 million Series Q Bond — UF 3 million Short-term amount (in million US$) 302.5 4.2 2.2 7.3 7.0 Long-term amount (in million US$) - 249.5 446.3 393.9 684.6 Interest rate Date of Issuance 3.63% 4.38% 4.25% 4.25% 3.50% 03/04/2013 23/10/2014 07/05/2019 22/01/2020 10/09/2021 Date of Maturity Ammortization 03/04/2023 28/01/2025 07/05/2029 22/01/2050 10/09/2051 Bullet Bullet Bullet Bullet Bullet 17.4 0.9 1.8 0.3 95.9 4.90% 13/01/2009 05/01/2030 60.8 123.0 122.8 3.80% 3.25% 3.45% 04/04/2012 05/04/2018 08/11/2018 01/02/2033 15/01/2028 01/06/2038 Semi-annual, starting in 2019 Bullet Bullet Bullet (1) UF-denominated bonds are fully hedged to US dollars with currency swaps. The bond issuance contracts in the local market require the Company to maintain a total debt level ratio of no more than one times for Series H, Series O and Series Q bonds, calculated for the period of the last 12 months. 2 COMPANY PROFILE 18 3. OUR CORPORATE GOVERNANCE 3.1 CORPORATE GOVERNANCE FRAMEWORK SQM has a Corporate Governance Model based on its Corporate Governance Policy, which is the reference framework for directors and was last updated in October 2022. This policy establishes the Board's duty to exercise its best judgment based on what it reasonably believes to be in the best interests of the Company and its shareholders. Thus, it serves as a guide to steer the responsible exercise of the directors' duties without creating legal obligations, since they are assumed to be known. Moreover—in line with best practices worldwide—SQM's Sustainability, Ethics, and Human Rights Policy, and the commitments arising from it, embodies the Company's comprehensive approach to sustainability. Progress in relation to these good governance, environmental, and social commitments is led and supervised by the Board of Directors and involves workers, contractors, shareholders, the supplier and supply chain, customers, as well as the communities and territories where we operate. (Data regarding 2022 management in the areas of sustainability are reported in item 8.2 of this Report). Acting ethically begins with each member of SQM and their fundamental commitment to the law and the Company's values: Excellence, Integrity, Safety, and Sustainability. In this context, the Code of Ethics and the Code of Conduct for Business Partners are essential documents for managing these matters and are supported by related policies, procedures, and financial controls, which together are a relevant component of the Company's Ethics and Compliance Program. These policy instruments and the program apply to all members of the organization in all operations, whether local or international: senior executives, board members, managers, full-time and part-time employees, etc. The regulatory instruments that comprise SQM's ethical framework also include the Conflicts of Interest Policy, which aims to protect the integrity of the Company's decision-making process; the Antitrust Policy, which establishes rules regarding conduct that should never be engaged in in the market context in order to avoid anti-competitive practices; and the Crime Prevention Model (CPM), which complies with the provisions of Law 20,393 on the Criminal Liability of Legal Entities and its amendments. This procedure also applies to SQM's operations globally and to all of its affiliates, subsidiaries, and companies in which it has more than a 50% stake, at the discretion of the Risk Management and Compliance Manager. The CPM has the organizational structure established for this purpose, with a Crime Prevention Officer whose duties include: • Ensuring the proper development, implementation, operation, and update of the CPM. • Reporting semiannually, or as circumstances warrant, to the Board of Directors on his/her management and the operation of the CPM. • Performing specific reviews to verify compliance with the main controls that prevent the crimes referred to in Law 20,393. Implementing a training program on the CPM aimed at SQM members. • • Ensuring the correct operation of the whistleblower channels and their respective procedures. • Conducting or requesting that investigations be conducted when an unusual or suspicious situation arises. • Leading the control and analysis process of the risks and controls related to offenses under Law 20,393. 3 OUR CORPORATE GOVERNANCE 19 It should be noted that the Crime Prevention Officer has the autonomy and independence to access and report directly to the Board of Directors, in order to report on his or her work. The CPM includes prevention, detection, and response activities, including training and communication to strengthen the company's ethics culture. All other policies related to matters that represent potential risks, which have been duly disseminated throughout the organization, are part of this crime control and prevention environment: • Anti-Bribery and Corruption Compliance Policy • Corporate Reimbursement and Expense Claim Policy • Sponsorship and Membership Procedures • Donation and Contribution Procedures • Global Procedure for Internal Investigations and Sanctions. • Global Whistleblower Procedure SQM's formal Whistleblower Channels include the web form (www.SQM.ethicspoint.com), which is also available on the company's website and intranet, as well as telephone numbers according to the geographic location of the SQM unit or operation. It is worth noting that the use of these channels is protected by confidentiality mechanisms, guaranteeing the anonymity of the whistleblower, both employees and third parties, as required by local legislation. Reported allegations are reviewed by the Crime Prevention Officer in conjunction with Audit Management to assess whether they merit an investigation, as described in the Global Procedure for Internal Investigations and Sanctions. International anti-corruption laws which SQM is subject to include the Foreign Corrupt Practice Act (FCPA), the regulations established by the Security and Exchange Commission (SEC) of the United States, as well as similar laws applicable in the countries where the Company operates. The aforementioned policies and codes (publicly available at www.sqm.com, Sustainability tab, Corporate Governance section) also constitute the framework that sets out the criteria for a constructive relationship with SQM's stakeholders. As stated in the Sustainability, Ethics, and Human Rights Policy, along with promoting a culture of integrity and ethics, the Company encourages respect for and compliance with the commitments made to customers, employees, regulators, communities, authorities, shareholders, and suppliers. In order to regulate relations with the latter stakeholder, Chile has a Responsible Sourcing Policy, which expresses specific commitments regarding fair treatment, environmental protection, and unrestricted respect for human rights, as per its adherence to the UN Universal Declaration of Human Rights, the Guiding Principles on Human Rights and Business, and the International Labor Organization (ILO) Conventions, to which Chile is a signatory. Aware of the need to address, among other relevant issues, the common challenges of the climate crisis, inequalities, and emerging diseases, SQM aspires to a long-term and collaborative relationship with its stakeholders, based on a responsible business strategy that includes action points and their respective metrics. This model integrates technological developments and innovation to offer effective solutions that contribute to the progress and well-being of people, co-constructing an economic, social, and environmental value proposition together with the communities, workers, innovation centers, and academia, as well as the Company's suppliers and customers. Precisely in the area of innovation, in 2021 the Company incorporated an Innovation Governance System that guides decision-making at the executive level with respect to definitions and priorities. Thus, an Innovation Management area was created, reporting to the Vice-Presidency of People and Performance. In both 2021 and 2022, efforts were made to centralize information on innovation challenges to share best practices within the Company and connect it with the innovation ecosystem. 3 OUR CORPORATE GOVERNANCE 20 The year this area was created, we made progress in defining the innovation strategy, its focal points, and a survey of the different projects under development by SQM that could be considered an innovation. Likewise, the purpose of innovation at SQM was defined as creating unique and highly valued solutions in the global markets of the chemical and non-metallic mining industries, which will allow us to sustainably double the Company's value every five years. For SQM, innovation should focus on business models, products, and processes that are unique in their respective industries and markets, that deliver high-value solutions to customers, whose impact on results exceeds US$5 million EBITDA on a regular basis, and that ensure competitiveness and sustainability in the industry. With regard to identifying possible organizational, social, or cultural barriers and determining the range of skills, knowledge, conditions, and experiences in the performance of different functions, the Equality, Diversity, and Inclusion approach of SQM's Sustainability, Ethics, and Human Rights Policy defines three areas to guarantee equal opportunities for the development of all members of the Company, in an environment of cordiality, equality, respect, and openness: • Ensuring no salary discrimination by hiring, promoting, and making employment decisions based on objective criteria related to the person's aptitude for the position. • Blind recruitment, evaluating applicants according to their competencies and requirements for the position, with no discrimination of any kind. • Development of activities or programs aimed at target audiences that require improvement or preparation. Likewise, the Opportunities, Development and Worker Satisfaction Approach, included in the same policy, establishes the duty to generate the conditions for each SQM worker to reach his or her maximum potential, systematically managing the following goals or lines of work in hiring and development policies: • Creation of offers and opportunities for internal mobility. • Training for workers to improve their competencies for a position. • Ongoing evaluation of employee performance through the implementation of plans that allow for continuous improvement in their work. Implementation of a rewards system to promote SQM's values in work teams. • • Monitoring work teams through surveys to determine strengths and opportunities for improvement, establishing an action plan for this purpose. 3 OUR CORPORATE GOVERNANCE 21 Below is SQM's organizational chart, which shows the Company's main units/areas, as well as their reporting lines and leadership: Board of Directors Committee Corporate Governance Committee Safety, Health and Environment Committee Board of Directors CEO Ricardo Ramos Audit & Risk Management Officer Carolina Salinas Ethics & Compliance Officer Alberto Llona Executive VP Nitrates & Iodine Pablo Altimiras Executive VP Lithium Carlos Díaz Senior VP Corporate Services José Miguel Berguño CFO Gerardo Illanes Sustainability Manager Javier Silva Investor Relations Kelly O’Brien Public Affairs Manager Ignacia López 3 OUR CORPORATE GOVERNANCE 22 3.2 BOARD OF DIRECTORS Board Member Identification SQM's Board of Directors consists of eight regular members. There are no alternate members. The entire Board of Directors is regularly elected every three years at our Ordinary Shareholders’ Meeting. The Board of Directors may appoint replacements to fill any vacancies that occur during periods between elections. If a vacancy occurs, the entire Board must be elected or re-elected at the next regularly scheduled Ordinary Shareholders’ Meeting. The last election of directors was at the Ordinary Shareholders' Meeting on April 26, 2022. Name, Chilean ID, Nationality Position Gonzalo Guerrero Yamamoto Chilean ID 10.581.580-8 Chilean Election date: April 2022 Chairman and Member of the Safety, Health and Environment Committee. Patricio Contesse Fica Chilean ID 15.315.085-0 Chilean Nationality Election date: April 2022 Hernán Büchi Buc Chilean ID 5.718.666-6 Swiss Election date: April 2022 Vice Chairman and Member of the Corporate Governance Committee and the Safety, Health and Environment Committee. Director and Member of the Corporate Governance Committee Dang Qi Chilean ID 48.220.394-9 Chinese Election date: April 2022 Director and Member of the Safety, Health and Environment Committee. Experience and Expertise Mr. Guerrero earned a law degree from the Universidad de Chile and a Master of Business Law from the Universidad Adolfo Ibáñez. He was General Counsel and substitute Board member of Integramédica S.A. for more than seven years and was a Director of Inversiones Oro Blanco S.A., Asfaltos Chilenos S.A., VNT S.A. (Vantrust Capital Asset Management) and SMA Clinica Internacional S.A. (Perú), among others. Currently, he is an Executive Board member of Guerrero and Associates, Chairman of the Board of Sanasalud S.A., director of SQM Salar S.A. and Chairman of the Fundación para el Desarrollo Social y Patrimonial de Maria Elena and Director of ICARE. Legal, regulatory, Corporate Governance, sustainable development and community relations aspects are among his areas of experience. His areas of knowledge include regulatory and Corporate Governance matters. Mr. Contesse is a lawyer with a degree from the Pontificia Universidad Católica de Chile. Previously, he was a Board member of SQM from 2013 until 2015. Since 2011, he has held senior executive positions in Pampa Group through 2021, where he is currently Vice Chairman of the Boards of Directors of the Pampa Group entities. Mr. Büchi earned a degree in Civil Engineering from the Universidad de Chile. He served on the SQM Board of Directors for several years until April 2016, before rejoining in 2017. During his career, he advised different governments in Latin America, Eastern Europe and Asia on the design and implementation of economic policies. He served the Government of Chile in different capacities, including the positions of Undersecretary of Economy (1979 -1980) and Minister of Finance (1985-1989). He is currently a Board member of Quiñenco S.A., among others. He is also Chairman of the Board of Directors of the Universidad del Desarrollo. In addition to his experience in various industries, his areas of expertise include Finance, Corporate Governance, Regulations and Public Policies. Ms. Dang Qi earned a degree in Spanish Literature and Spanish-speaking Cultures from the Beijing Foreign Studies University and has 17 years of experience at Xinhua News Agency as a director and correspondent in four Latin American countries and a chief reporter in China. Between May 2017 and March 2019, she was director of the Xinhua News Agency office in Chile. She held that same position in Costa Rica and Panama, in addition to being a Xinhua correspondent in Mexico. In China, she served as a writer, editor and reporter for Xinhua. Other areas of expertise are Corporate Governance, Regulations and Public Policies. 3 OUR CORPORATE GOVERNANCE 23 Name, Chilean ID, Nationality Position Antonio Gil Nievas Chilean ID 23.605.789-5 Spanish Election date: April 2022 Director and Member of the Directors' Committee. Independent. Gina Ocqueteau Tacchini Chilean ID 8.431.507-9 Chilean Election date: April 2022 Director and Member of the Directors' Committee. Independent. Ashley Ozols Chilean ID 48.218.888-5 Australian Election date: April 2022 Director and Member of the Directors' Committee. Antonio Schneider Chaigneau Chilean ID 6.027.199-2 Chilean Election date: April 2022 Director and Member of the Corporate Governance Committee Experience and Expertise Mr. Gil earned a degree in Industrial Engineering from ICAI (Universidad Pontificia Comillas, Spain), MBA from Harvard University, Stanford Executive Program. He has more than 25 years of experience in strategic leadership, risk management financial and investment roles at a global, European and Latin American level. Currently, he is director of Latam Airlines Group and strategic and financial advisor to various national and international companies. Previously, he was CEO of Moneda Asset Management, Vice President of ACAFI, Managing Director, global CFO and member of the global executive committees of various businesses at JPMorgan and was a strategic consultant for BCG in Spain. In addition, he has knowledge in regulatory matters and Corporate Governance. Ms. Ocqueteau graduated as a nurse from the Universidad de Chile, holds an MBA from ESADE Business School and have more than 30 years of career in different areas of ACHS. She is currently the director of the Asia Pacific Chamber of Commerce and Fundación Marca Chile, counselor of Chile Mujeres, teacher of BOW Mujeres Empresarias, co-founder of Unión Emprendedora, founding partner of Crosscheck and CEO of Waygroup Chile. Throughout her professional career, she has accumulated extensive experience in risk management, security, and cybersecurity. Previously, she was also the director of ASECH and was a member of the Advisory Council of the Ministry of Women and Gender Equality in 2021. Aspects of Corporate Governance, sustainable development and relations with communities are among his areas of experience. Mr. Ozols earned a Bachelor of Commerce degree from the University of New South Wales, Sydney and is also a CFA charterholder. He has over 20 years of international business experience providing strategic, financial and advisory services to American, Australian and Asian based clients. Between 2003 and 2017, he worked at several investment banks, including Macquarie Group, Grant Samuel, and CLSA. Between 2017 and beginning his role as a board member at SQM in 2021, he worked at Tianqi Lithium as an executive focused on corporate development. In addition, he has knowledge in regulatory matters and Corporate Governance. Mr. Schneider has a doctorate from The New School, New York and has a degree in Economics from Universidad de Chile. He has worked in Chile in the cosmetics, forest products, salmon and food crops, fruit export, and food products industries. He is associated with financial and banking representations, mainly in Larrain Vial S.A., in international business, mining and its development as a national investment bank. He has been a director at InvertecFoods, Pesquera Yadran, ChileFoods, Indura Peru, Salmonfood, and Banco Estado, among others. 3 OUR CORPORATE GOVERNANCE 24 Board of Directors Diversity Diversity Women (25%) Men (75%) Chilean Directors (50%) Foreign Directors (50%) Independence Under the Chilean Law (25%) Under the NYSE regulations (88%) Age 30 to 40 years old (25%): 41 to 50 years old (25%): 51 to 60 years old (25%): Over 70 years old (25%): Board Tenure Less than 3 years (63%): Between 3 and 6 years (13%): Between 6 and 9 years (25%): Board Attendence > 90% of ordinary sessions None of our directors has a disability. Gonzalo Guerrero Yamamoto Patricio Contesse Fica Hernán Büchi Buc Dang Qi Antonio Gil Nievas ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● Gina Ocqueteau Tacchini ● Ashley Ozols Antonio Schneider Chaigneau ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● We have been informed that only one of the directors indirectly owns 1,730 of SQM’s outstanding shares as of December 31, 2022. 3 OUR CORPORATE GOVERNANCE 25 Board of Directors Compensation At the Ordinary Shareholders’ Meeting held on April 26, 2022, shareholders approved the compensation for the Board of Directors and members of the Audit and Financial Risk Committee, Corporate Governance Committee and the Safety, Health and Environmental Committee for the 2022 business year, as follows: Board Position Chairman Vice Chairman Director Member of the Directors’ Committee Member of the Safety, Health and Environment Committee Member of the Corporate Governance Committee Fixed compensation, gross monthly payment, regardless of attendance and number of sessions 800 UF2 700 UF 600 UF 200 UF 100 UF Variable compensation1, as a percentage of the Company's net income obtained during the business year of 2022 0.12% 0.12% 0.06% 0.02% - 100 UF - 1For the calculation of the variable compensation that the directors will be entitled to receive, the 2022 net income will be considered with a maximum limit of 110% of the 2021 net income. The variable compensation will not be paid together with the amounts of the fixed compensation, and will be paid after the approval of the Company's financial statements as of December 31, 2022 by the ordinary shareholders' meeting, in proportion to the time served by the director, considering the period from May 2022 to April 2023, based on the Company's 2022 financial results. 2 Unidades de Fomento. The UF is an inflation-indexed, peso-denominated unit that is linked to, and adjusted daily to reflect changes in, the previous month’s Chilean consumer price index Shareholders also approved a budget for board operating expenses equal to the sum of the directors' annual remunerations. The Board compensation is equal for all board members, regardless of their gender, and only differs for the position held within the Board and participation in committees as presented in the table above. The following tables show the remuneration paid to each of our directors who served on the Board of Directors during 2022 and 2021 (amounts in thousands of Chilean pesos): 3 OUR CORPORATE GOVERNANCE 26 Summary of Board Compensation January - December 2022 (thousands of Chilean pesos) Directors ALBERTO SALAS MUÑOZ ANTONIO GIL NIEVAS ANTONIO SCHNEIDER ASHLEY OZOLS DANG QI FRANCISCO UGARTE LARRAIN GEORGES DE BOURGUIGNON ARNDT GINA OCQUETEAU GONZALO GUERRERO YAMAMOTO HERNAN BÜCHI BUC Board of Directors SQM S.A. Directors’ Committee SQM S.A. Fixed 101,325 163,081 163,081 Variable 597,760 Fixed 25,331 54,360 Variable 99,627 224,006 107,597 47,338 142,014 75,994 298,881 75,994 298,881 25,331 99,627 163,081 54,360 293,435 298,881 239,075 298,881 LAURENCE GOLBORNE RIVEROS 75,994 298,881 25,331 99,627 Corporate Governance Committee SQM S.A. Safety, Health and Environment SQM S.A. Fixed Fixed Consulting Contract Representation & Travel Expenses Total 27,180 12,666 39,846 13,665 20,555 39,846 20,000 315 315 91,399 86,611 53,214 16,877 46,729 824,043 217,756 190,576 484,005 249,180 387,541 499,833 270,655 669,039 624,531 499,833 PATRICIO CONTESSE FICA 278,920 597,760 39,846 39,846 48,866 1,005,238 ROBERT ZATTA TOTAL 14,696 191,284 205,980 2,010,696 2,988,806 232,051 298,881 119,538 113,912 20,000 344,326 6,128,210 3 OUR CORPORATE GOVERNANCE 27 Summary of Board Compensation January - December 2021 (thousands of Chilean pesos) Board of Directors SQM S.A. Directors’ Committee SQM S.A. Corporate Governance Committee SQM S.A. Safety, Health and Environment SQM S.A. Consulting Contract Representation & Travel Expenses Total Directores Fixed Variable Fixed Variable Fixed Fixed ALBERTO SALAS MUÑOZ FRANCISCO UGARTE LARRAÍN GEORGES DE BOURGUIGNON ARNDT GONZALO GUERRERO YAMAMOTO HERNÁN BÜCHI BUC LAURENCE GOLBORNE RIVEROS PATRICIO CONTESSE FICA ROBERT J. ZATTA TOTAL 286,831 104,447 71,708 17,408 215,124 52,224 35,854 215,124 52,224 71,708 17,408 215,124 52,224 215,124 52,224 215,124 52,224 71,708 17,408 250,977 213,971 104,447 52,224 35,854 35,854 1,827,399 522,238 215,124 52,224 107,562 480,394 303,202 356,464 363,681 323,075 356,464 431,959 301,857 479 19,873 4,827 35,854 60,000 35,854 35,662 107,370 60,000 25,179 2,917,096 3 OUR CORPORATE GOVERNANCE 28 Policy for Hiring Advisors by the Board of Directors The Company has no policy in place for the Board of Directors to hire experts to advise it on accounting, tax, financial, legal, or other matters. Under the Corporations Act, companies are subject to "pre-approval" requirements, whereby all audit and non-audit services provided by the independent auditor must be pre-approved by the Directors' Committee. SQM's Board of Directors approves all audit, tax, and other services provided by the auditors. Any services provided by the auditors that are not specifically included within the scope of the audit must be previously approved by the Directors' Committee prior to their execution. In 2022, the Board of Directors hired the following consultants: Entity PriceWaterhouseCoopers Others TOTAL Type of Service Amount (US$) Audit of Financial Statements Legal and other advisory servcies US$1.31 million US$0.04 million US$1.35 million Onboarding of New Board Members All new directors receive orientation on the Company, its business, risks, policies, procedures, principal accounting criteria, sustainability, and the legal framework applicable to the Company and its directors. No later than 60 days after the election of a new Board of Directors, the Board will be provided with the pertinent information on the Company, including, among others, the Company's Bylaws, Code of Ethics, Market Interest Information Management Manual, Antitrust Policy, Sustainability Report, Annual Report in Form 20-F, and the Company's most recent annual report. General Management will coordinate meetings between directors and relevant management units to review business issues and risks, including those related to sustainability, site visits, and other briefings, as appropriate. Through the Sustainability Report, the Board of Directors is informed about relevant stakeholders, and a meeting is coordinated with the Sustainability and Community Relations Manager to explain to Board members the relevance of these groups and their expectations, in an effort to maintain a stable, long-term relationship with them. Likewise, at least one annual training course on corruption risks, the Company's Ethics and Compliance Program, and antitrust risks are coordinated with the Compliance Manager. This training can be conducted alongside the training for new directors or as a stand-alone activity. Meetings with the Compliance, Risk Management, Internal and External Audit Departments The Board of Directors meets as needed through the Directors' Committee, but it meets at least twice a year with the Audit and Risk Management Manager to review: (i) the annual audit program or plan; (ii) the recommendations and improvements that, in the opinion of the Audit and Risk Management Manager, should be made to prevent the occurrence of irregularities or fraud; (iii) the effectiveness of the crime prevention models implemented by the Company; and (iv) that the entire organization actually complies with the Company's internal controls, procedures, and policies, and to be informed of the opinion of the Audit and Risk Management Manager regarding the effectiveness and adequacy of such policies, procedures, and controls, and any possible improvements thereto. 3 OUR CORPORATE GOVERNANCE 29 The Board of Directors also meets as necessary, but no less than twice a year, with the Audit and Risk Management Manager and the Ethics and Compliance Manager to (i) analyze the proper functioning of the risk management process, which is developed following international principles, guidelines, and recommendations of the Committee of Sponsoring Organizations (COSO) 2013; (ii) review the risk matrix used by the unit, as well as the main sources of risk and methodologies for detecting new risks, and the probability of those new risks occurring and their possible impact; (iii) review the recommendations and improvements that in the opinion of the Audit and Risk Management Manager make the Company's risk management more efficient; and (iv) review the contingency plans designed to react to the occurrence of critical events, including the continuity of the Board of Directors in crisis situations. In addition, the Board of Directors meets as necessary, but no less than twice a year, with the external audit firm in charge of auditing the Financial Statements to review: (i) the audit program or annual program; (ii) any differences detected in the audit with respect to accounting practices, administrative systems, and internal auditing; (iii) any serious deficiencies that may have been detected and those irregular situations that by their nature must be reported to the corresponding auditing bodies; (iv) the results of the annual audit program; and (v) possible conflicts of interest that may exist in the relationship with the auditing firm or its personnel, both for the provision of other services to the Company or to the companies of its corporate group, as well as for other situations. Periodicity of reporting on environmental and social matters The Board of Directors considers the social and community, safety, health, environmental and sustainability impact of its decisions. For this reason, the Safety, Health, and Environment Committee (the "SHEC") was established to assist the Board in its review of the Company's policies, and any changes or improvements to them related to these matters that may affect the Company. Each year, the SHEC reviews the framework of the Company's sustainability policies and strategies including, in addition to the aforementioned issues, human rights aspects, monitoring the Company's performance with respect to these challenges, and reviewing their adequate disclosure in the Company's Sustainability Report. The SHEC meets as needed, but not less than four times a year. Site visits The Board of Directors makes reasonable efforts to hold at least one Board meeting per year at or near the Company's operating facilities. The Board of Directors visits at least one facility to get a better idea of the unit’s condition and operation, the main responsibilities and concerns of those who work in those offices and facilities, and the recommendations and improvements that, in the opinion of those responsible for those units and facilities, should be made to optimize their operation. In October 2022, the Board of Directors held its ordinary meeting at the Company's facilities located in the Salar de Atacama. In addition, as part of the induction process for new Board members in June 2022, directors Antonio Gil Nievas and Antonio Schneider visited the Company's facilities in Nueva Victoria, Coya Sur, Tocopilla, Salar de Atacama, and the Carmen Lithium Chemical Plant. Evaluation and Training of the Board of Directors Every year, the Board of Directors analyzes its own processes and performance through an evaluation designed to promote efficiency and continuous improvement. This evaluation could be performed by a third party. At the end of this evaluation, the Board of Directors defines the specific training measures 3 OUR CORPORATE GOVERNANCE 30 that it believes should be implemented, considering the advice of a third-party expert to identify and implement any improvements. Organizational, social, or cultural barriers In order to detect and reduce organizational, social, or cultural barriers that may be inhibiting the natural diversity of capabilities, visions, characteristics, and conditions that would have been present in the absence of such barriers, this matter is analyzed on an ongoing basis to ensure that the Board of Directors represents a multiplicity of approaches and the greatest expertise to examine and address the matters within its purview. Ensuring compliance with this goal is part of the responsibilities assigned to the Company's Safety, Health, and Environment Committee, which operates at the Board level. Director Assistance Pursuant to Article 15 of the Company's Bylaws, the Board of Directors shall meet at least once a month. Directors may attend the sessions in person or by conference call or videoconference, for which appropriate means are available. Members of the Board of Directors and of the various committees on which they serve are expected to attend meetings fully prepared and to remain for the duration of the meeting. Attendance at Board meetings is disclosed annually in the Board of Directors' report card, which is published on the Web Site. Pursuant to Article 13 of the Bylaws, a director who fails to attend three consecutive meetings without a cause qualified as sufficient by the Board of Directors, shall cease to hold office ipso jure and shall be replaced without further proceedings. In such case, and in the event of incompatibility, resignation, removal, death, bankruptcy, or any other incapacity of a director that disqualifies him/her from holding office, the Board of Directors shall appoint the corresponding replacement or replacements in conformity with the provisions of the Corporations Law and they shall remain in office until the next ordinary meeting of shareholders to be held by the Company, at which time, moreover, all of the directors shall be elected. Board members are expected to have at least 75% attendance at meetings each year. During 2022, the Company's Board of Directors met 19 times, holding 13 ordinary meetings and 6 extraordinary meetings. No director attended less than 90% of the total number of regular Board meetings. The Board's average attendance was 99%. Operational continuity plan SQM has an Operational Continuity Policy intended to ensure that all the Company's activities and those of its subsidiaries can remain stable in the event of an incident with the potential to interrupt or affect critical business processes or assets. People's health and safety is the first priority in the event of incidents or catastrophic events, for which SQM has Emergency Plans in addition to this policy (see Section 5.6). Thus, the Business Continuity Policy sets the foundations for each of the procedures aimed at minimizing the impact that events of this nature could have on the normal development of the Company's operations. 3 OUR CORPORATE GOVERNANCE 31 The Operational Continuity Policy has Operational Continuity Plans (OCP) for each of the following areas: • Mining area • Process and production areas • Camp and passenger transportation areas • Logistics, warehousing, and product transportation areas • IT and information security areas In addition, each site has its own OCP covering the aforementioned areas. Each vice-presidency is responsible for assessing the critical processes and assets required to meet its objectives and commitments, and for planning to mitigate potential impacts of possible incidents. Information system SQM has business information systems that technologically support the company's BackOffice processes in areas such as Finance, Accounting, Human Resources, and Logistics. It also has information systems that support operational processes for maintenance, production management, product inventory, and quality, among others. SQM has a corporate ERP system for its base in Chile, as well as an ERP system for its commercial offices, which then consolidate the information in the head office’s platforms. SQM seeks to optimize the management and deployment of its technological services through leading cloud service platforms, achieving cost efficiencies and response times that allow rapid adaptation to business flows and market conditions. With regard to information security and cybersecurity, we have an awareness program aligned with the strategic goals of the business and risk committee, in order to safeguard our most important information assets and ensure high standards of information security, with world-class tools to mitigate potential attacks on our infrastructure. 3 OUR CORPORATE GOVERNANCE 32 3.3 BOARD COMMITTEES Directors' Committee/ Audit & Financial Risk As of December 31, 2022, the Company has a Directors' Committee to perform the functions provided for in Article 50 bis of Law No. 18,046. The Directors' Committee was elected on April 26, 2022, and consists of Directors Antonio Gil Nievas, Gina Ocqueteau Tacchini, and Ashley Ozols. Under the provisions applicable as of December 31, 2022, Antonio Gil Nievas and Gina Ocqueteau Tacchini held and still hold the status of Independent Director. Ashley Ozols was and still is the Chair of the Company's Directors' Committee. On April 26, 2022, SQM's General Ordinary Shareholders' Meeting agreed to pay each director member of the Directors' Committee a monthly remuneration equivalent to UF 200 and an annual remuneration equivalent to 0.02% of the Company's net income for the 2022 fiscal year. For details of the compensation received by each member of the Committee during fiscal years 2022 and 2021, see section 3.2, specifically the Board of Directors' Summary Per Diem tables. During 2022, the Directors' Committee met 11 times. The Chair of the Committee reports on its activities no later than at the next Company Board of Directors meeting. In 2022, the Committee analyzed or reviewed, as the case may be, the following matters: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (xi) the Company's Unaudited Financial Statements and Reports; the Company's Audited Financial Statements and Reports; the Reports and proposals of the Company's External Auditors, Account Inspectors, and Independent Risk Rating Agencies; the proposal to the Board of Directors regarding the External Auditors and the Independent Risk Classifiers that said Board of Directors may recommend to the respective Shareholders' Meeting for their subsequent appointment; tax and other services, other than auditing services, rendered by the Company's external auditors on behalf of the Company and its subsidiaries in Chile and abroad; the remuneration systems and compensation plans for the Company's employees, managers, and senior executives; proposals to the Board of Directors on corporate policies that the Company must have, as required by law; the Company's risk matrix; activity related to the Company's compliance program; the Company's Internal Control Report; and the different matters referred to in the chapter "Directors' Committee", which is included in the Company's Financial Statements as of December 31, 2022. In this context and in relation to the above, the Committee: (a) Examined the background information on the Company's Financial Statements for the 2022 fiscal year and the Report issued by the Company's External Auditors. Likewise, it also examined the Company's Interim Consolidated Financial Statements for the 2022 business year. 3 OUR CORPORATE GOVERNANCE 33 (b) Proposed to the Board of Directors the names of the Company's external auditors and independent risk classifiers that the Board of Directors of the Company, in turn, could suggest for appointment to the respective Ordinary General Shareholders' Meeting of the Company. The Board of Directors approved these suggestions and the Board, for its part, also accepted them. (c) Reviewed and approved the compensation systems and compensation plans for the Company's employees and Senior Executives. The Committee also (i) authorized the Company's engagement of various non-audit related consulting services with PwC, (ii) reviewed the expenses of the Company's general manager, (iii) reviewed the reports of the Company's internal audit and risk and compliance areas, and (iv) reviewed the information presented by the external auditors. The Committee issued the Annual Management Report referred to in Law No. 18,046. During 2022, the Company had no related party transactions that must be executed under the requirements and procedures established in Title XVI of the Corporations Law. During 2022, the Committee incurred internal audit consulting expenses of approximately US$832.8 thousand. Corporate Governance Committee The purpose of the Corporate Governance Committee ("CGC") is to assist the Board of Directors in fulfilling its responsibilities of reviewing and recommending policies related to corporate governance matters affecting the Company. The CGC consists of three directors and meets as needed, but not less than twice a year. Two members of the CGC shall constitute a quorum. The responsibilities of the CGC include, but are not limited to: (a) Annually, the CGC reviews the corporate governance policy and, if appropriate, recommends changes to the document; (b) Annually, the CGC reviews compliance with the corporate governance policy and ensures compliance with applicable regulatory requirements. As part of the process, the Board of Directors reviews the best corporate governance practices adopted by other entities, both locally and internationally; (c) The CGC ensures that a proper succession plan is in place for the General Manager and management. This includes a list of possible candidates available to replace the General Manager in the event that the Board of Directors determines such a change or in the event that an emergency replacement is necessary, taking into consideration the skills, experience, independence, and expertise required for the position. (d) The CGC ensures that there is a proper succession plan for the Chair of the Board of Directors, taking into consideration his/her skills, experience, independence, and the expertise required for the position. The CGC will make its best effort to identify suitable potential candidates to propose to the Board of Directors; (e) The CGC receives and reviews, upon request from management, an update on communication with the Company's shareholders, including institutional shareholders, analysts, and potential shareholders; 3 OUR CORPORATE GOVERNANCE 34 (f) The CGC receives and reviews any Directors' and Officers' Liability Policy before it is implemented by the Company. Health, Safety, and Environment Committee The purpose of the Safety, Health, and Environment Committee ("SHEC") is to assist the Board of Directors in fulfilling its responsibilities in the review and recommendation of policies related to social, safety, health, environmental, and sustainability issues affecting the Company. The SHEC meets as needed, but not less than four times a year. Two members of the SHEC shall constitute a quorum. The SHEC will report its key findings to the Board on a regular basis. Review the Company's safety, health, environmental, and Its main responsibilities include: (a) sustainability policies periodically and recommend changes to such policies to the Board of Directors or management. In relation to defining policies, indicators, and reports, the Board will ensure that international standards such as the guidelines of the Sustainability Accounting Standards Board (SASB), Global Reporting Initiative, or equivalent are followed; (b) Receive and review, at least once a year, written reports from management on the compliance status of safety, health, environmental, and sustainability policies and on compliance with applicable regulations; (b) Receiving and reviewing, at least once a year, written reports from management on the compliance status of safety, health, environmental, and sustainability policies and on compliance with applicable regulations; (d) Review monthly management reports received by the Board of Directors that mention any occurrence of a safety, health, or environmental incident that is required to be reported to the relevant regulatory authorities. If a member of the SHEC deems it necessary, he/she may call a meeting of the relevant personnel to receive further information detailing the nature of the incident and describing the action taken to remedy it; (e) Review the management of the Company's safety, health, and environmental emergency response planning procedures; and (f) Receive and review, at least once a year, the organizational, social, or cultural barriers detected that could be inhibiting the natural diversity that would have occurred in the absence of those barriers. 3 OUR CORPORATE GOVERNANCE 35 3.4 MAIN EXECUTIVES Identification of the main executives As of December 31, 2022, the main executives of SQM are the following: Name Position Profession Chilena ID Appointment Date Ricardo Ramos R. CEO Civil Industrial Engineer Gonzalo Aguirre T. General Counsel Lawyer Pablo Altimiras C. José Miguel Berguño C. Carlos Díaz O. Executive Vice President Nitrates and Iodine Senior Vice President of Corporate Services Executive Vice President Lithium Gerardo Illanes G. CFO Ignacia López B. Natalia Pizarro G. Rodrigo Vera D. Public Affairs Manager Vice President of Human Recourses and Performance Vice President of Mining Operations Remuneration of main executives 8.037.690-1 January 2019 13.441.419-7 September 2016 13.657.862-6 December 2021 10.903.992-6 December 2021 10.476.287-5 December 2021 13.904.120-8 October 2018 10.777.962-0 October 2019 Civil Industrial Engineer Civil Industrial Engineer Civil Industrial Engineer Civil Industrial Engineer Journalist Civil Engineer 14.167.897-3 March 2019 Civil Industrial Engineer 9.120.446-0 March 2020 For the years 2022 and 2021, the total remunerations received by the main executives are the following: Number of Executives Fixed Remuneration (in millions of CLP) Variable Remuneration (in millions of CLP) Total Remuneration (in millions of CLP 9 10 3,365 2,866 3,575 3,921 6,940 6,787 Year 2022 2021 Compensation plans The Company has compensation plans to motivate a group of Company executives and encourage them to remain with the Company. There are 2 compensation plans in effect as of December 31, 2022: Equity-based compensation plan Plan established for the period 2017 to 2022 by granting payments based on changes in the Company's share price. There is a partial payment of the stock benefit program in the event of termination for reasons other than resignation and application of article 160 of the Labor Code. This compensation plan is linked to the Company's performance through the price of the Company's Series B shares (Santiago Stock 2 OUR CORPORATE GOVERNANCE 36 Exchange). The compensation plan considers 29 Company executives who are entitled to this benefit, provided that they remain in the Company until a certain date, recognizing on an accrual basis: i) a 2021 bonus that will be paid by paying 146,708 shares distributed over the four quarters of 2021 and ii) a 2022 bonus for 42,032 shares that will be paid in the first quarter of 2023. Each executive's compensation is the value of multiplying: • • • the average price of the series B shares on the Santiago Stock Exchange during the fourth quarter of 2020, in its equivalent in U.S. dollars (with a value of US$41.93 per share). the average price of SQM's Series B shares for the last quarter of 2022 with a maximum cap of US$54.00 per share. a number of equivalent shares that were individually assigned to each executive who is part of the plan. The current plan was approved by the Board of Directors and considers 188,740 shares. The effects on the income statement correspond to a charge of US$2.251 bn and US$5.978 bn for the periods ended December 31, 2022 and 2021, respectively. Shares exercised through December 31, 2022 were 188,740. Compensation plan based on financial goals This compensation plan is linked to the Company's achievement of specific financial goals. There is a partial payment of the stock benefit program in the event of termination for reasons other than resignation and application of article 160 of the Labor Code. This compensation plan includes 40 Company executives, who are entitled to this benefit, provided that they remain with the Company until the end of 2025. Payment dates, if applicable, will be during the first quarter of 2026. This compensation plan was approved by the Board of Directors and became effective as of January 1, 2022. The charge to income for the period corresponds to US$8.495 bn as of December 31, 2022. We have been informed that the following senior executives hold SQM shares as of December 31, 2022: Name Position Gerardo Illanes G. CFO José Miguel Berguño C. Senior Vice President of Corporate Services Percentage of SQM’s outstanding shares <1% <1% 3 OUR CORPORATE GOVERNANCE 37 3.5 ADHERENCE TO NATIONAL AND INTERNATIONAL CODES The company does not adhere to any Code issued by public or private organizations. Nevertheless, it has a corporate Code of Ethics and a Sustainability, Ethics, and Human Rights Policy, based on the United Nations Sustainable Development Goals (SDGs); the Principles of the International Council on Mining and Metals; the International Standard ISO 14001 (Environmental Management Systems); the applicable standards of the International Finance Corporation (IFC) and the "Protect, Respect, and Remedy" framework of the United Nations Guiding Principles on Business and Human Rights, inspired—in turn— by the Universal Declaration of Human Rights, Convention 169 on Indigenous and Tribal Peoples of the International Labor Organization, to mention some guidelines on the subject. 3.6 RISK MANAGEMENT The risk management area is responsible for promoting the company's risk culture, managing the Business Risk Management Model, and providing methodological support to the different areas involved in the process. Its main responsibilities are: • To evaluate and monitor the activities developed by the business areas: identifying, evaluating, treating, monitoring, and communicating business risks and their associated controls. • To define an annual risk management work plan. This plan should consider the information and evaluation provided by the different areas involved in risk management, monitoring of the activities carried out by these areas, updating of the risk identification and evaluation, and training or dissemination activities. • To facilitate risk management training, mainly for areas that manage critical processes. • To ensure the efficient application of the risk management methodology, adhering to the organization's policies, standards, manuals, and procedures. • To facilitate and coordinate the identification, evaluation, treatment, and follow-up of critical risks with the business areas. • To provide methodological support to the different areas involved in risk management, regarding the implementation of the risk management policy and procedure. • To monitor that the corresponding responsible parties adequately implement the action plans for critical risks. • To periodically report to the Directors/Audit and Financial Risk Committee. This report shall contain, at a minimum, the management activities performed (including identification, evaluation, and action plans) with regard to the risks and critical processes. There is also an Internal Audit area, where the scope of activities includes, but is not limited to, objective examinations of evidence for the purpose of providing independent assessments to the Directors/Audit and Financial Risk Committee and senior management on the adequacy and effectiveness of the Company's processes, risk management, and controls. 3 OUR CORPORATE GOVERNANCE 38 The audits performed by the Internal Audit area include verifying whether: • The actions of the Company's directors, officers, employees, and contractors comply with the Company's policies, procedures, and applicable laws and regulations. • The processes and systems in place enable control and compliance with policies, procedures, laws, and regulations that could significantly affect the Company. • The information and the means used to identify, measure, analyze, classify, and report such information are reliable and of high integrity. • Resources and assets are acquired cost-effectively, used efficiently, and adequately protected. Internal Audit also provides the following services: • Risk management and control consulting, as required by senior management and not affecting the objectivity and independence of the function. • To evaluate the design and effectiveness of internal controls for issuing financial statements, reporting the results to the Chief Executive Officer and the Vice President of Finance, in order to comply with Section 302 of the Sarbanes-Oxley Act. The Audit and Risk Manager will report periodically to senior management and the Directors/Audit and Financial Risk Committee, regarding: • The purpose, authority, and responsibilities of the Audit and Risk Manager. • The Audit Plan and its development. • Internal Audit's compliance with the Standards, and action plans to address any significant breaches. • Significant risk exposures and control issues, including fraud risks, FCPA, governance issues, and other matters requiring the Committee's attention. • Results of audit work or other activities. • Resource requirements. • Any risk that may be assumed by senior management that is unacceptable to the Company. The Audit and Risk Manager also coordinates activities, where possible, and may rely on the work of other internal and external assurance and consulting service providers as needed. The audits may identify opportunities to improve the efficiency of risk management processes and controls. These opportunities are communicated to the appropriate level of senior management, the Chief Executive Officer and the Directors/Audit and Financial Risk Committee. Risk Management Model 3 OUR CORPORATE GOVERNANCE 39 Based on the Corporate Risk Management Policy, the company's Risk Management Model consists of a methodology that establishes a process under the principles and guidelines of ISO 31000 and COSO ERM (Committee of Sponsoring Organizations of the Treadway), which determine a set of coordinated activities to reasonably direct and control the achievement of its goals. The risk management process considers the following stages: a) b) c) d) e) Identification Evaluation Treatment Monitoring Communication Risk assessment consists of determining two dimensions for each risk: the probability of occurrence and the impact on the Company if the risk materializes. Risk assessment is carried out on the basis of inherent risk, to document what the impact and probability would be if controls were not mediated, or if they did not operate satisfactorily, and then on residual risk, i.e., considering the mitigation measures identified by the areas. Probability and impact are quantified from 1 to 5, with 1 being the lowest level. Impact can be: Negligible, Minor, Moderate, High, or Very High, while Probability can be: Improbable, Unlikely, Possible, Probable, or Almost Certain. If an undesired event could have more than one type of consequence, impact is determined by the greatest consequence. On the other hand, the level of risk is determined by weighting impact and probability. Being a 5x5 matrix, there are 25 risk levels, which for simplicity are divided into 4 main categories: Extreme (red), Significant (orange), Medium (yellow), and Low (green). The Risk Owner(s) is/are defined in order to adequately manage each risk. In addition to the risk assessment, the area identifies which Control Activities it has implemented for each risk. This allows the risk management area, together with the Control Owner, to identify the specific controls for each risk. Once the assessment has been completed and the controls identified, the risk management area sends the risk matrix, including the controls identified, to each area for its management and control. Each person responsible presents the main results to the Risk Committee for its knowledge and validation. With this process, the cycle is closed. Regardless of this update, each area is responsible for keeping its matrix up to date and managing the correct application of the controls. In addition, it must inform the risk management area in the event that an identified risk materializes or if there is a significant change in the matrix. Human Rights Risk Management In order to comply with the Human Rights Due Diligence commitments undertaken by the company and reflected in its Sustainability, Ethics, and Human Rights Policy, SQM commissioned a Human Rights Impact Assessment (HRIA) from a specialized law firm. This first HRIA followed the methodological 3 OUR CORPORATE GOVERNANCE 40 standard developed by the Danish Institute for Human Rights, coupled with the reporting criteria of the Global Reporting Initiative (GRI) and based on the UN Principles on Business and Human Rights. The purpose of this survey was to identify, understand, evaluate, and take charge of any potential adverse effects of SQM's activities on the enjoyment of its main stakeholders' human rights (workers, communities surrounding the project, suppliers, etc.). This survey's baseline and findings were subsequently subject to an on-site participatory review process with the principal stakeholders, carried out by a consultant, in order to corroborate and/or modify the initial findings and generate the controls, policies, and action and monitoring plans suitable for responding to these challenges. Based on the aforementioned inputs, SQM's Risk Management area proceeded to consolidate and unify the information to generate the Participatory Matrix, which should be completed during the second quarter of 2023. Role of the Board of Directors and Senior Management in Risk Management The Board of Directors oversees the supervision and development of the business risk management model through the Directors/Audit and Financial Risk Committee. The Vice-Presidencies are responsible for identifying, evaluating, quantifying, and communicating the risks associated with their activity and the defined goals, as well as for defining controls and risk treatment, each with defined responsibilities and deadlines, and for monitoring control and its principal risks. These processes are conducted following the risk management procedure for the Business. The Business Risk Committee supervises, analyzes, and evaluates the development of the Risk Management Model. This committee, together with the vice presidencies, defines the company's strategic risks. In addition, the Sustainability Committee monitors the main commitments and risks related to: Water Management, Emissions, Waste Management, Electric Power, and Communities. This committee is formed by the General Manager, the senior vice presidents and those responsible for the areas according to the topics discussed. Succession Plans The Company does not have a Succession Plan as such, but the Corporate Governance Policy defines that it is the Board's responsibility to annually identify potential replacements for the Chief Executive Officer and other senior executives of the Company, who possess the skills, knowledge, conditions, experiences, and vision necessary for each position and to ensure that there is a plan to replace the Chief Executive Officer and other senior executives in a timely manner, in the event of their unforeseen absence, minimizing any possible impacts on the Company. Salary Structure Review Salary structures and compensation and indemnification policies for the CEO and other senior executives are not subject to shareholder approval or review by outside parties. It should be noted, however, that the Board of Directors and its respective committees act in accordance with what is reasonably in the best interest of the Company and its shareholders. 3 OUR CORPORATE GOVERNANCE 41 The Corporate Governance Policy establishes that the Directors/Audit and Financial Risk Committee's responsibilities include reviewing the compensation and remuneration plans of the chief executives, the Chief Executive Officer and the company's employees, as well as reviewing in detail the quarterly expenses incurred by the Chief Executive Officer. Code of Conduct and Whistleblower Channel As mentioned above, the company's Code of Ethics establishes the standards to be followed by all employees in the performance of their duties. By complying with the Code, SQM ensures that work is being done in the right way with the right people and in a way that everyone can be proud of, creating value for all stakeholders. The Code is supported by policies, procedures, and related financial controls, which together are an important part of the Ethics and Compliance Program, based on a corporate culture of integrity and adherence to best practices. Violations of the Code of Ethics are reported through the formal support and reporting channels that are available to all SQM employees worldwide and also to third parties (shareholders, customers, suppliers, and business partners, among others). The corporate website and intranet have direct access to the whistleblower channel for people to access and make their respective reports. The formal channels are: • Website: http://www.SQM.ethicspoint.com • Helpline / Hotline by location: Location Free dial-in Chile Belgium USA Mexico Spain ENTEL: 800-360-312 Movistar: 800-800-288 Claro: 800-225-288 0-800-100-10 844-330-7095 001-800-658-5454 900-99-0011 South Africa 0-800-99-0123 Ecuador 1-999-119 China (Shanghai) 10-811 China (Beijing) 108-888 In addition to encouraging employees to access the corporate Whistleblower Channel, there is also the possibility for them to consult directly with the Ethics and Compliance Management on different matters related to the program. All reports of concerns are kept confidential in accordance with SQM policies and procedures. Reports may also be made anonymously, where permitted by local law. Whistleblowers can know the status of their submission, if required. 3 OUR CORPORATE GOVERNANCE 42 Anyone expressing concerns in good faith will be protected from retaliation. Retaliation can occur in many forms, including harassment, intimidation, demotion, or the assignment of unwanted tasks as a result of making a report in good faith. Retaliation against workers who report is, in itself, a violation of this Code. This will be investigated and, if proven, sanctioned. A good faith report is one in which the whistleblower believes that what they are reporting is true or that there is a strong possibility that misconduct has occurred or is occurring, and the report was not made maliciously. A report does not necessarily have to be substantiated to be made in good faith, but the whistleblower must believe that it is a genuine concern of possible misconduct. Regarding the use of the Whistleblower Channel, during 2022 a communication campaign was conducted to promote it by sending periodic emails to employees and placing posters in different parts of the facilities, among others. As a complement to the above, it should be noted that the Code of Ethics is delivered to 100% of employees; new employees joining the company must complete the Compliance e-learning course; and for other employees, as appropriate, they can access the "Reinforcement of Ethics and Compliance Program" course each year for executive, supervisory, and general roles. Crime Prevention Model As explained in item 3.1, SQM has a Crime Prevention Model, which includes a set of policies, procedures, standards, and controls that constitute a preventive and monitoring process through different control activities on the processes that are exposed to the risks of committing the crimes indicated in Law 20,393. The Model establishes the Prevention, Detection, and Response activities and the roles of each of the stakeholders involved in the CPM. This document sets out the activities that involve the company's Crime Prevention Officer, as well as the different support areas. The Crime Prevention Model is certified by certifying firm Feller-Rate from September 2021 to September 2023. 3.7 RELATIONSHIP WITH STAKEHOLDERS AND THE GENERAL PUBLIC As regards the stakeholder relations units and channels identified in item 6.3 of this Report, SQM has an Investor Relations area for Shareholders and Investors, which can be contacted at the following e-mail ir@sqm.com. Through this email, stakeholders can clarify doubts on various business matters. In addition to strictly complying with the legal obligations related to market disclosures, SQM has a series of additional mechanisms that allow it to disseminate these relevant facts, as well as the Company's performance, to a wider public through press releases issued by the Communications unit. (See summary table on following page) At the same time, these units, together with SQM's Sustainability area, prepare the Annual Report and Sustainability Report and disseminate them to all stakeholders, along with other communication media, allowing stakeholders to evaluate the information reported on the Company's economic, social, and environmental performance. This feedback is given through surveys and consultations that are managed both via e-mail (sustentabilidad@sqm.com; ir@sqm.com) and social media platforms, as well as in person, in the case of the Sustainability Report, when it is presented to the communities in the area of influence of the Company's operations in various on-site meetings. 3 OUR CORPORATE GOVERNANCE 43 These mechanisms as a whole provide valuable input and information for continuous improvement in the process of developing and disseminating topics of interest. Below are the main channels and forums for relations with SQM's stakeholders, as well as the frequency with which they are carried out: 3 OUR CORPORATE GOVERNANCE 44 Main Relationship Channels with Stakeholders Stakeholders How We Engage and Communicate Employees Daily interactions in the workplace/ Direct communication between supervisors and area managers and the workers reporting to them/ Regular union meetings, meetings between workers, management, senior vice-presidents and managers. Internal communication channels, such as data screens in common areas, newsletters, bulletin boards, intranet and mailings/ Key information is delivered on digital platforms such as: the website, email, Facebook, Instagram, LinkedIn, YouTube channel and the app “Mi SQM” (My SQM). Shareholders / Investors Board meetings, regularly issued information, direct contact with Investor Relations, financial reports, web page, site visits, shareholder meetings, meetings like SQM Day, provision of key information about the company through digital platforms such as: the website, e-mail, Facebook, Instagram, LinkedIn and our YouTube channel. Contractors and Suppliers Meetings with personnel from the supply and contracting departments, as well as operational managers and supervisors where services are provided/ Visits by the Supply Department to supplier facilities or offices/ Orientation courses, safety training/ Follow-up and ongoing contacts with service providers selling our products in order to guarantee deliveries/ Special programs for supplier training attended by SQM in the regions/ Meetings with trade associations attended by SQM/ Delivery of important information on digital platforms such as: the website, e-mail, Facebook, Instagram, LinkedIn and our YouTube channel. Customers Periodic, direct communication and visits with customers/ Site visits and surveys on products and operating standards/ Delivery of important information about the company through digital platforms such as: the website, e-mail, Facebook, Instagram, LinkedIn and our YouTube channel. Community Communication and regular meetings with SQM representatives, community leaders and members/ Site visits/ Involvement in local working groups and operational inspections alongside public agencies/ Community activities and festivities/ Daily interaction with programs developed in conjunction with the community or organizations/ Delivery of important information about the company through digital platforms such as: the website, e-mail, Facebook, Instagram, LinkedIn and our YouTube channel. Organizations and Institutions Meetings with participation by our representatives/ Meetings to support initiatives/ Technical meetings/ Visits to sites or areas of interest/ Participation in seminars, training, etc./ Delivery of key information for the company through digital platforms such as: the website, e-mail, Facebook, Instagram, LinkedIn and our YouTube channel. Innovation, Academic and Research and Development Centers Meetings with participation by our representatives/ Meetings to support initiatives/ Technical meetings/ Visits to sites or areas of interest/ Participation in seminars, training, etc./ Delivery of key information for the company through studies, publications promoted or supported by SQM and digital platforms such as: the website, e-mail, Facebook, Instagram, LinkedIn and our YouTube channel. Authorities Official or formal meetings/ Technical meetings/ Work meetings related to public and private initiatives/ Inspections / Delivery of information using official platforms, documents or e-mail. Media Contact with media through communications area/ Press releases, interviews or meetings/ Delivery of important information about the company through digital platforms such as: the website, e-mail, Facebook, Instagram, LinkedIn and our YouTube channel. 3 OUR CORPORATE GOVERNANCE 45 4. STRATEGY SQM is a global company that develops and produces diverse products for various industries essential to human progress such as health, nutrition, clean energy, and technology, through innovation and technological advancement. Our goal is to sustain our world leadership position in the lithium, potassium nitrate, iodine, and salts markets. • Securing access to the best assets related to our current businesses, expanding our global presence • Actively pursuing attractive minerals, allowing us opportunities for diversification to replicate and expand our current mining capabilities • Strengthening our operational, logistical, and commercial excellence, from end to end, while seeking to be cost leaders; and • Maintaining a conservative financial policy that allows us to successfully face economic cycles that could affect the markets where we sell. We are a dynamic company. In pursuit of our goals, we expect to acquire and develop projects and interests that are consistent with our existing and new businesses, either alone or with joint venture partners. We may also divest or sell interests we have acquired to deploy funds for other investments or other purposes in pursuit of our goals or to adjust risk or diversify our asset base. We are a company built and managed by a culture based on excellence, safety, sustainability, and integrity. We work every day to expand this culture by fostering talent attraction, retention, and development, as well as an inclusive work environment to ensure distinctive knowledge and innovation to sustain our business. We strive for safe and accident-free operations by promoting behaviors that promote the physical safety and psychological well-being of all those who work directly and indirectly with the Company. We position ourselves as leaders in sustainability and are committed to a sustainable future where we work consistently to responsibly manage natural resources, protect human rights, care for the environment, build close and trusting relationships with our neighboring communities, and create value. Within these communities, we support projects and activities with a focus on education, business development, and protection of the environment and historical heritage. We create value for our customers through established business models and the production and development of distinguishing products that respond to the specific needs of the industry and the market, constantly creating and providing a sustainable improvement in quality of life. We will continue to create value for all of our stakeholders through responsible natural resource management, sustainable expansion projects, and enhancement of our existing operations, with a focus on minimizing our environmental impacts by reducing our carbon, energy, and water footprints and working together with our shareholders, employees, customers, suppliers, and communities. 4 STRATEGY 46 4.1 TIME HORIZONS Items of property, plant and equipment are depreciated by distributing their cost over their estimated technical useful life on a straight-line basis, which is the period the Company expects to use them. When separate components of an item of property, plant and equipment have different useful lives, they are recorded as separate items and depreciated over their own useful lives. Useful lives are reviewed annually. The useful lives of items of property, plant, and equipment located in the Salar de Atacama are the lesser of their technical useful life and the remaining years to 2030. Specific items of mobile equipment are depreciated on the basis of operational hours. The principal useful lives used to depreciate property, plant and equipment are as follows in years: Property Classes Plants and Equipment Life or minimum rate in years (short term) Life or maximum rate in years (long term) Life or average rate in years (medium term) Mining assets Power generating assets Buildings Household goods and accessories Office equipment Transportation equipment Network equipment and communications Computer equipment Machinery, plants and equipment Other fixed assets 3 5 3 4 5 8 4 5 3 3 4.2 STRATEGIC OBJECTIVES Our Strategy, how do we understand our approach? 10 16 25 10 10 9 12 10 25 15 8 10 13 8 9 9 8 8 10 9 The approach of a responsible business strategy includes, by definition, sustainability in its design and operation. When we evaluate and analyze, we make the decision to commit to sustainability in the business, which is set out in our Sustainability, Ethics, and Human Rights Policy. Then, we define our strategic axes that respond to the materialization of our purpose. From this approach we organize business development proposals based on establishing targets and goals and linking them to the SDG targets that are integrated into these definitions. At the same time, we work to reduce our ecological footprint throughout our value chain, from our suppliers to our production and responsible consumption practices. We have set targets related to decarbonization, biodiversity conservation, and environmental impact reduction. Responsible action is part of our culture. This also includes respecting the interests of our employees, customers, investors, and the community. 4 STRATEGY 47 In addition, our business has been marked by constant innovation challenges, which have become opportunities to strengthen the internal management of our business. Given the above, there are constant changes and adaptations. Our innovative, high-quality products help us contribute to solving global challenges and, at the same time, ensure our financial performance. Safety and ethics are fundamental drivers for a sustainable approach to our business, both for labor relations and for our stakeholders. We mitigate ethical, economic, social, and environmental risks by applying strong control measures. We strive to minimize our impact on the environment by applying safe and innovative production techniques, generating high environmental standards and strict quality management, which are key processes for our organization. Moreover, we aim to strengthen our company by recruiting, developing, and motivating talented employees. We closely follow new global trends and challenges. To understand the nature and complexity of the expected changes, we make use of the so-called scenario technique, which allows us to identify and incorporate aspects that are of strategic relevance. We also participate in dialogues and initiatives, share lessons learned and best practices with other organizations in our industry, and assess developments of cross-cutting concern to humanity. This allows us to minimize risks while taking advantage of new business opportunities. Our Sustainability Plan Our Sustainability Plan commits us to meeting new environmental, social, and governance requirements and expectations. We have developed a plan based on the United Nations Sustainable Development Goals, which is complemented by a series of initiatives to ensure that we live in harmony with the environment, the communities surrounding our operations, and our own employees. The plan has 3 work pillars, based on which we have set medium- and long-term goals in the areas of: water, carbon neutrality, waste management, ecosystem protection, contributing to sustainable industries, as well as the co-creation of value with communities and workers. Contributions to Sustainable Industries • To continue being a relevant player in the sustainable development of the world, with a high participation in key industries for human development (health, food, renewable energies, and sustainable mobility) that improve the quality of life of people around the world. • To build trust and credibility for years to come, enhancing a brand that is publicly associated with the world's other green industries. Our People • Establish a strong local presence and be a good neighbor. • Participate in sustainable value co-creation with communities over time. • Enhance local economies and the development of neighboring communities, contributing to the creation of shared social value. • All SQM employees are responsible community agents. • Continue to ensure safe and inclusive working conditions. • Through its operations, SQM ensures safe and inclusive working conditions while participating in local economies and the sustainable development of neighboring communities. 4 STRATEGY 48 Our Environment • Improve the ecosystem monitoring systems surrounding our operations so that we can provide an even more timely response. • Reduce brine abstraction by 50% by the year 2030. This process began with a 20% reduction in abstraction in November 2020. • Reduce inland water consumption by 65% by 2040, starting with a 40% reduction by 2030, as projected in 2020. • To be carbon neutral in all our products from cradle to customer by 2040 and in the case of lithium, potassium chloride, and iodine by 2030. • Creation of a corporate waste management system to promote a cultural change towards sustainability. The first step is to measure, and then find out how to reduce, including that of its suppliers, workers, collaborators, and offices in Chile and the rest of the world. • SQM is committed to responsibly managing the natural resources used, minimizing its direct impact on flora and fauna, and working together with the communities to support the care and protection of these ecosystems. SDG and Business Strategy Goals 4 STRATEGY 49 At the Center SDG Integration into the Business Strategy SDG 12 y SDG 13 (12) Responsible consumption and production and (13) Climate action: We work towards responsible consumption and production as part of our purpose. We develop products to contribute to meeting society’s needs, and we do so based on challenging ecological footprint reduction goals. • 12.2 By 2030, achieve the sustainable management and efficient use of natural resources. Some of the SDG targets that we support: • Some of our actions / examples of our progress: Outcome SDG SDG 3, SDG 7 y SDG 15 Some of the SDG targets that we support: 12.4 By 2020, achieve the environmentally sound management of chemicals and all wastes throughout their life cycle, in accordance with agreed international frameworks, and significantly reduce their release to air, water and soil in order to minimize their adverse impacts on human health and the environment.. 12.5 By 2030, substantially reduce waste generation through prevention, reduction, recycling, and reuse. 13.2 Integrate climate change measures into national policies, strategies and planning. 13.3 Improve education, awareness-raising and human and institutional capacity on climate change mitigation, adaptation, impact reduction and early warning. Responsible Care Certification. Certification from the International Fertilizer Association. Solar power use at our operations. Waste management system at the corporate level. Recycling plans at operations and in offices. Air Decontamination Plan in communities production sites. Development and implementation of the Sustainability, Ethics and Human Rights Policy. Carbon footprint measurement (GHG). Establishment of greenhouse gas reduction targets based on science (SBTi). Sustainability talks. IRMA Certification in process. Integration into the Business Strategy The results that we are seeking to produce through responsible business activities are related to our purpose: (3) Good health and wellbeing: One of our goals is contributing to the development of innovative solutions in order to improve access to and the quality of healthcare and thus move towards wellbeing for all people. (15) Life on land: We protect our ecosystems, improving our production processes and developing products that contribute to the preservation of biodiversity. (7) Affordable and clean energy: We understand the opportunity that we have to contribute key solutions for generating and storing NCREs with affordable and effective solutions. We also contribute to the production of foods, providing solutions for the efficient use of soil and water resources. 3.9 By 2030 substantially reduce the number of deaths and illnesses from hazardous chemicals and air, water, and soil pollution and contamination. 7.2 Increase substantially the share of renewable energy in the global energy mix by 2030. 15.1 By 2020, ensure the conservation, restoration and sustainable use of terrestrial and inland freshwater ecosystems and their services, in particular forests, wetlands, mountains and drylands, in line with obligations under international agreements. 4 STRATEGY 50 Some of our actions / examples of our progress: Compliance with Operational Risk Management System. Training on Occupational Health and Safety. Implementation of photovoltaic plants. Solar power use at our operations. Implementation of Environmental Monitoring Plan in the Salar de Llamara. Implementation of Environmental Monitoring Plan in the Salar de Atacama. Articulators and Facilitators SDG Integration into the Business Strategy: These are levers for establishing good, responsible and viable business. They sustain our ethical practices and teamwork, which promote and catalyze the development and innovation proposals that yield our products and technologies. (9) Industry, innovation and infrastructure: R+D+I is one of the axes of our strategy. It is a cross- cutting practice related to how and what we do. We maintain practices of innovation, development and research as one of the critical processes in our business. We are responsible for uncovering and integrating our customers’ new needs and global challenges. We are continually changing and improving our processes and proposals in order to respond to these needs. SDG 9, SDG 16 y SDG 17 (16) Peace, justice and strong institutions: This is a cross-cutting process that is part of the strategic operational decisions that we make on a daily basis. It builds the context in which we engage with all of our stakeholders. We are constantly improving and strengthening our business integrity practices. We establish ethics and transparency as the foundations of having a viable business. (17) Partnerships for achieving our goals: We could not develop our business without the support and strengthening that we achieve through our partnerships. An active connection to the community helps us to understand our customers’ needs and challenges and to promote effective solutions. This is also how we perform our role as an entity that contributes to the following areas: Social and economic: We make local development investments through partnerships with public- and private sector organizations based on our social investment focus areas. Science-based development: We support research programs through academic and public production development organizations, strengthening acceleration programs for innovative enterprises. We also contribute to the public good through scientific publications and patents. 9.2 Promote inclusive and sustainable industrialization and, by 2030, significantly raise industry’s share of employment and gross domestic product, in line with national circumstances, and double its share in least developed countries. 9.4 By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities. 16.5 Substantially reduce corruption and bribery in all their forms. 16.b Promote and enforce non-discriminatory laws and policies for sustainable development. 17.16 Enhance the Global Partnership for Sustainable Development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology and financial resources, to support the achievement of the Sustainable Development Goals in all countries, in particular developing countries. 17.17 Encourage and promote effective public, public- private, and civil society partnerships, building on the experience and resourcing strategies of partnerships. Some of the SDG targets that we support: Some of our actions / examples Work with local suppliers. Development of and compliance with the Code of Conduct for Business Partners. We are in the process of developing a Responsible Sourcing Policy. Participation in the Más Proveedores program in Tarapacá. 4 STRATEGY 51 of our progress: Solar power use at our operations. Compliance with the Code of Ethics. Implementation of and compliance with the Ethics and Compliance Program. Implementation of and compliance with the Crime Prevention Model. Development of and compliance with the Sustainability, Ethics and Human Rights Policy. Compliance with the Diversity and Inclusion Policy. Development of Inclusive Labor Practices. Development of the Apprentices Program. Development of the Internal Mobility Program. Alliances with: Global Battery Alliance, the Global Compact, Acción Empresas and other entities. Participation in HuellaChile. Development of working groups with communities. Development and implementation of social programs with communities. Our main policy to generate a positive impact on different objectives of social interest is the Sustainability, Ethics and Human Rights Policy, which is based on the United Nations Sustainable Development Goals (SDGs), the Principles of the International Council on Mining and Metals, International Standard ISO 14001 Environmental Management Systems, the applicable standards of the International Finance Corporation (IFC) and the “protect, respect and remedy” framework of the United Nations Guiding Principles on Business and Human Rights, and inspired by in the Universal Declaration of Human Rights, Convention 169 on Indigenous and Tribal Peoples of the International Labor Organization, among others. Our policy includes the following areas of the company and the business: ethics and corporate governance; employees; value chain; environment and sustainable development; and communities. 4 STRATEGY 52 4.3 CAPITAL EXPENDITURE PLANS SQM regularly reviews different opportunities to improve its production methods, reduce costs, increase production capacity of existing products and develop new products and markets. Additionally, significant capital expenditures are required every year in order to sustain the Company’s production capacity. The Company is focused on developing new products in response to identified customer demand, as well as new products that can be derived as part of its existing production or other products that could fit its long-term development strategy. SQM’s capital expenditures in Chile have been mainly related to the organic growth and sustainability of its business, including the construction of new facilities and the renovation of plants and equipment. In 2022, the Company also worked on the expansion of its lithium carbonate and lithium hydroxide capacity in Chile, which reached 180,000 metric tons and 30,000 metric tons respectively, by the end of 2022. We also began expansions related to the mining and production facilities of nitrates and iodine in Chile and lithium hydroxide in Western Australia. The capital expenditures for the years ended December 31, 2022, 2021 and 2020 were as follows: (In million US$) Capex………………. 2022 905.8 2021 471.5 2020 322.2 2022 During 2022, we had total capital expenditures of US$905.8 million. Our 2022 capital expenditure was primarily related to: • Capacity expansion projects related to the completion of our increase of our lithium carbonate production in Chile from 120,000 metric tons per year to 180,000 metric tons per year by the end of 2022; • Completion of capacity expansion of lithium hydroxide production in Chile from 21,500 metric tons per year to 30,000 metric tons per year; • Investment in our new 50,000 metric ton Mt. Holland lithium hydroxide mine and refining plant in Western Australia; • Acquisition of the 20,000 metric ton lithium hydroxide refining plant in China; and • Investment in the development of new caliche projects to optimize the iodine and nitrate production plants and carry out general maintenance of all production facilities, among others. 2021 During 2021, we had total capital expenditures of US$471.5 million. Our 2021 capital expenditure was primarily related to: • Capacity expansion projects related to the completion of our increase of our lithium carbonate production in Chile from 70,000 metric tons per year to 120,000 metric tons per year by the end of 2021 and investment in further lithium carbonate production capacity expansion from 120,000 to 180,000 metric tons per year in 2022; 4 STRATEGY 53 • Completion of capacity expansion of lithium hydroxide production in Chile from 13,500 metric tons per year to 21,500 metric tons per year and commencement of a further expansion of lithium hydroxide production capacity in Chile from 21,500 metric tons per year to 30,000 metric tons per year in 2022; • Investment in our new 50,000 metric ton Mt. Holland lithium hydroxide facility in Western Australia; • Optimization projects related to iodine production plants in Nueva Victoria; and • General maintenance of all production units in order to ensure the fulfillment of production and sales targets. 2020 During 2020, we had total capital expenditures of US$322.2 million, a decrease compared to the US$450 million that was originally expected as a result in the delay of the purchasing of equipment. Our 2020 capital expenditure was primarily related to: • Capacity expansion projects related to the increase of our lithium carbonate production in Chile from 70,000 metric tons per year to 120,000 metric tons per year; • Capacity expansion of lithium hydroxide production in Chile from 13,500 metric tons per year to 21,500 metric tons per year; • Optimization projects related to potassium nitrate production plants in Coya Sur; and • General maintenance of all production units in order to ensure the fulfillment of production and sales targets. The Company believes that its capital expenditures for 2023 could reach approximately US$1.2 billion focused on the increase of its production capacity, primarily related to lithium carbonate and lithium hydroxide capacity expansions and nitrates and iodine capacity in Chile, and development of the Mt. Holland lithium hydroxide project in Australia, as well as the maintenance of the production facilities in order to strengthen its ability to meet its production goals. SQM’s installed capacity of lithium carbonate and lithium hydroxide in Chile is expected to reach approximately 210,000 and 40,000 metric tons, respectively, during 2024. The Company will also continue to invest in the construction of the Mt. Holland lithium project in Western Australia and with the adjustments necessary to produce lithium hydroxide from lithium sulfate in China. 4 STRATEGY 54 5. OUR PEOPLE People are the center and the basis of our activities. This is why we foster respectful labor relations, creating the necessary conditions for each person to develop his or her capabilities. At SQM we value meritocracy, and we favor equal opportunities, inclusion and diversity, non-discrimination, and respect for human rights and individual and collective labor rights recognized by the main instruments of the International Labor Organization, as well as by the applicable legislation in each of the countries where we operate. To build our human team, we have done important work to adapt our selection and recruitment systems to include diverse groups of people, ensuring the inclusion of women in the mining industry. We have people from different professions and trades, operators, technicians, men and women of different ages and nationalities who contribute with their qualities, experience, and capabilities. Our Diversity and Inclusion Policy commits us as a company to: • Promote an internal culture of diversity, non-discrimination, and respectful treatment. • Promote equal opportunities, valuing and evaluating people based on their merits, performance, and efforts to generate value. • Adopt conditions and jobs, when required, to facilitate the gradual incorporation of people with disabilities. • Continuously challenge selection and evaluation processes to facilitate meritocracy and attract, develop, and retain talented people. • Build heterogeneous work teams, with people who share a common purpose in SQM and who permanently seek excellence. • Expand female participation at all levels and in all areas of the organization, and increase local employment around our operations. As of December 31, 2022, SQM's workforce in Chile and worldwide consists of 6,997 people. Eighty- three percent of our employees work in the company's operations in the north of Chile, mainly in the Tarapacá and Antofagasta Regions. For us, human capital—its technical and intellectual capabilities—are the foundation of our business approach to achieve our development, innovation, and product quality goals. Experience and competence is of high value for us to implement our business plan. Some important figures to highlight regarding our staff: 20% of Company employees are women Of the total number of people in Leadership positions (Senior Management, Management and Head of Division), 17.7% are women 65% of the workforce works in the Antofagasta Region and 18% in the Tarapacá Region 94% of the workforce has an indefinite-term contract 5 OUR PEOPLE 5.1 LABOR ENDOWMENT 5.1.1 Number of People by Gender We have a staff of 6,997 SQM workers, 19.58% of whom are women. Much of our workforce is found in the positions "operators", "other professionals" and "other technicians". Direct Employees by Position Category and Gender in 2022 Position Category Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Total Male 16 104 565 2,615 34 40 6 1,174 1,072 5,626 Female 2 18 127 230 39 81 1 748 125 1,371 Total 18 122 692 2,845 73 121 7 1,922 1,197 6,997 5.1.2 Number of People by Nationality We have a workforce made up of 90.2% Chilean nationality, followed by Mexican nationality with 2.22%. We have a diverse staff, where we have people of 24 different nationalities. Direct Employees by Position Category, Gender and Nationality in 2022, table 1 Position Category Gender Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Chilean 15 2 78 17 534 100 2,430 201 5 6 33 70 4 0 1,053 621 Mexican 0 0 9 1 8 10 60 12 0 0 3 1 1 1 22 15 Nationality Venezuelan 0 0 0 0 8 4 10 1 0 0 0 1 0 0 21 19 Belgian 1 0 7 0 2 2 2 0 8 11 0 3 0 0 10 20 5 OUR PEOPLE Bolivian 0 0 0 0 0 0 35 4 0 0 1 0 0 0 4 12 Colombian 0 0 2 0 3 0 20 4 0 0 1 2 0 0 11 3 56 Other Technicians Subtotal Total Male Female Male Female 1,026 116 5,178 1,133 6.311 12 0 115 40 155 3 4 42 29 71 1 0 31 36 67 4 0 44 16 60 7 2 44 11 55 Direct Employees by Position Category, Gender and Nationality in 2022, table 2 Position Category Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total Gender Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Spanish 0 0 2 0 3 3 15 0 0 6 0 0 0 0 12 9 1 0 33 18 Chinese 0 0 2 0 1 3 0 0 7 10 0 1 0 0 8 15 3 0 21 29 Nationality Peruvian 0 0 0 0 0 1 12 4 0 0 0 0 0 0 7 0 8 3 27 8 South African 0 0 1 0 3 0 20 3 3 1 0 1 0 0 3 3 2 0 32 8 51 50 40 35 USA 0 0 1 0 1 2 0 0 9 0 1 0 0 0 8 11 0 0 20 13 33 Direct Employees by Position Category, Gender and Nationality in 2022, table 3 Position Category Nationality Gender Dutch 0 0 0 0 1 0 4 Australian 0 0 0 0 0 0 0 Brazilian 0 0 0 0 0 1 1 Korean 0 0 0 0 0 0 0 Italian 0 0 1 0 0 0 0 Senior Management Managers Division Head Operators Male Female Male Female Male Female Male 5 OUR PEOPLE Ecuadorian 0 0 1 0 1 1 3 0 0 0 0 0 1 0 3 6 2 0 11 7 18 Japanese 0 0 0 0 0 0 0 57 Female Male Female Male Female Male Female Male Female Male Female Male Female Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total 0 0 0 0 1 0 0 2 1 1 0 8 2 10 0 0 0 0 0 0 0 6 1 0 0 6 1 7 1 0 0 1 0 0 0 1 2 0 0 3 4 7 0 0 2 0 0 0 0 1 2 1 0 2 4 6 0 1 0 0 1 0 0 0 2 0 0 2 3 5 Direct Employees by Position Category, Gender and Nationality in 2022, table 4 0 0 3 0 0 0 0 0 2 0 0 0 5 5 Position Category Gender Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female German 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 2 0 0 1 2 Argentine 0 0 0 0 0 0 2 0 0 0 0 0 0 0 0 0 0 0 2 0 3 2 Nationality Indian 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 0 0 0 2 0 2 Cuban 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 0 0 0 2 2 5.1.3 Number of People by Age Range We have a young workforce, with 82.5% of employees between 18 and 50 years old. Paraguayan Moroccan 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 1 0 1 5 OUR PEOPLE 58 Direct Employees by Position Category, Gender and Age Range in 2022 Position Category Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total Gender Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female 5.1.4 Years of Service Age Range <30 years old 0 0 1 0 30 8 483 78 3 5 12 13 0 0 256 221 207 39 992 364 30-40 years old 0 0 35 3 211 62 931 98 15 19 10 23 2 1 509 368 445 47 2,158 621 41-50 years old 9 1 36 9 183 41 625 37 7 8 7 24 2 0 260 117 252 21 1,381 258 51-60 years old 7 1 27 3 111 14 454 16 8 6 5 18 0 0 115 35 140 15 867 108 61-70 years old 0 0 5 3 29 2 117 1 1 1 5 3 2 0 32 7 28 3 219 20 1.356 2,779 1,639 975 239 >70 years old 0 0 0 0 1 0 5 0 0 0 1 0 0 0 2 0 0 0 9 0 9 Total 16 2 104 18 565 127 2.615 230 34 39 40 81 6 1 1.174 748 1.072 125 5.626 1.371 6,997 Direct Employees by Position Category, Gender and Years of Service in 2022 Years of Service Position Category Gender <3 years 3-6 years 6-9 years 9-12 years >12 years Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Male Female Male Female Male Female Male Female Male Female Male Female Male Female 1 0 23 4 167 41 947 158 10 13 15 26 0 0 3 0 25 5 140 27 747 51 10 12 11 25 1 1 0 0 10 0 53 6 287 13 1 1 3 6 0 0 3 0 9 1 77 20 330 4 6 3 2 10 3 0 9 2 37 8 128 33 304 4 7 10 9 14 2 0 Total 16 2 104 18 565 127 2.615 230 34 39 40 81 6 1 5 OUR PEOPLE 59 Other Professionals Other Technicians Subtotal Total Male Female Male Female Male Female 602 448 360 50 2.125 740 2.865 300 168 327 34 1.564 323 1.887 82 35 119 11 555 72 627 98 50 144 16 672 104 776 92 47 122 14 710 132 842 1.174 748 1.072 125 5.626 1.371 6.997 5.1.5 Number of People with Disabilities Direct Employees with Disabilities by Position Category and Gender in 2022 Position Category Senior Management Gerencia Managers Operarios Division Head Administrativo Operators Otros Profesionales Sales Force Total Men Women Total N° 0 0 6 12 0 3 0 8 10 39 N° 0 0 0 1 0 0 0 2 0 3 N° 0 0 6 13 0 3 0 10 10 42 5.2 TYPES OF EMPLOYMENT CONTRACTS Out of our workforce, 94.48% has an indefinite-term contract and the remaining 5.52% has a fixed-term contract. We do not have any employment regimes per specific task, per mining site or per hour payment. 5 OUR PEOPLE 60 Direct Employees by Position Category, Gender and Contract Type in 2022 Position Category Gender Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Employment Contract Indefinite-Term 16 2 104 18 554 126 2,477 193 34 38 38 74 6 1 1,122 692 1,002 113 5,353 1,257 6,610 Fixed-term 0 0 0 0 11 1 138 37 0 1 2 7 0 0 52 56 70 12 273 114 387 Total 16 2 104 18 565 127 2,615 230 34 39 40 81 6 1 1,174 748 1,072 125 5,626 1,371 6,997 % of Direct Employees by Position Category, Gender and Contract Type in 2022 Position Category Gender Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Employment Contract Indefinite-Term 0.23% 0.03% 1.49% 0.26% 7.92% 1.80% 35.40% 2.76% 0.49% 0.54% 0.54% 1.06% 0.09% 0.01% 16.04% 9.89% 14.32% 1.61% 76.52% 17.96% 94.48% Fixed-term 0.00% 0.00% 0.00% 0.00% 0.16% 0.01% 1.97% 0.53% 0.00% 0.01% 0.03% 0.10% 0.00% 0.00% 0.74% 0.80% 1.00% 0.17% 3.90% 1.62% 5.52% Total 0.23% 0.03% 1.49% 0.26% 8.08% 1.81% 37.37% 3.29% 0.49% 0.55% 0.57% 1.16% 0.09% 0.01% 16.78% 10.69% 15.32% 1.78% 80.42% 19.58% 100.00% 5 OUR PEOPLE 61 5.3 WORKING HOURS Approximately 27.66% of our employees work the standard hours and 72.30% of our employees work various shift schedules (4x3, 7x7, or 14x14, among others). We do not have formal employment contracts with adaptable and/or remote working hours. Direct Employees by Position Category, Gender and Working Hours in 2022 Position Category Gender Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Standard 16 2 104 18 283 91 140 19 34 39 28 64 6 1 551 433 71 36 1.233 703 1.936 Working Hours Shifts 0 0 0 0 282 36 2.475 211 0 0 12 17 0 0 621 315 1.001 88 4.391 667 5.058 Part-time 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 0 0 1 2 1 3 Total 16 2 104 18 565 127 2.615 230 34 39 40 81 6 1 1.174 748 1.072 125 5.626 1.371 6.997 % of Direct Employees by Position Category, Gender and Working Hours in 2022 Working Hours Shifts Position Category Gender Standard Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal 5 OUR PEOPLE Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female 0,23% 0,03% 1,49% 0,26% 4,04% 1,30% 2,00% 0,27% 0,49% 0,55% 0,40% 0,92% 0,09% 0,01% 7,87% 6,19% 1,01% 0,51% 17,62% 10,04% 0,00% 0,00% 0,00% 0,00% 4,04% 0,51% 35,37% 3,02% 0,00% 0,00% 0,17% 0,24% 0,00% 0,00% 8,88% 4,50% 14,31% 1,26% 62,77% 9,53% Part-time 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,03% 0,00% 0,00% 0,01% 0,03% 0,01% Total 0,23% 0,03% 1,49% 0,26% 8,08% 1,81% 37,37% 3,29% 0,49% 0,55% 0,57% 1,16% 0,09% 0,01% 16,78% 10,69% 15,32% 1,78% 80,42% 19,58% 62 Total 27,66% 72,30% 0,04% 100,00% 5.4 WAGE EQUITY 5.4.1 Equity Policy Our company is made up of talented people with the capabilities to contribute to the development of our activities. We do not have plans or targets to reduce wage inequalities; however, our goal is to provide our employees with the opportunities and conditions necessary for each of them to develop and contribute in an environment of cordiality, equality, respect, and openness. To this end, in our Sustainability, Ethics, and Human Rights Policy, in our Equality, Diversity, and Inclusion Approach, we have defined the following development axes: • Ensuring no salary discrimination, hiring, promoting, and making employment decisions based on objective criteria related to the person's aptitude for the position. • Development of activities or programs aimed at target audiences that require improvement or preparation. • Blind recruitment, evaluating applicants according to their competencies and requirements for the position, with no discrimination of any kind. 5.4.2 Wage Gap The wage gap presented was calculated using the gross hourly wage of each labor category considering workers active as of December 31, 2022. The gaps reported are mainly due to the fact that the data represent Group companies with very different lines of business, and therefore, the roles of their employees and their job evaluations differ. In the case of operators, their salaries are established in the collective bargaining agreements and are the same for each position for both men and women. Each position has a different remuneration according to its evaluation. It should be noted that there is no gender discrimination, but grouping them into a single category shows a gap since women account for 8% of the total operator workforce. Moreover, we meet the gender gap measured in the NCH3262 certification process. 5 OUR PEOPLE 63 Salary Gap by Position Category, Mean and Median Position Category Average Salary Gap Median Salary Gap Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals 57% 94% 97% 85% 70% 101% N/A 84% Other Technicians Note: does not include the employees of our subsidiaries abroad or Ajay. 78% 5.5 WORKPLACE AND SEXUAL HARASSMENT 70% 113% 103% 85% 63% 96% N/A 85% 79% The company has a procedure for investigating sexual harassment, which is contained in the RIOHS (Internal Regulations for Order, Hygiene and Safety), as well as a procedure for investigating and sanctioning workplace harassment contained in the same regulation. As part of the above procedures, the company has set up a website for reporting complaints related to the ethics hotline, including complaints regarding workplace and sexual harassment (website: www.SQM.ethicspoint.com), as well as a toll-free helpline in several countries: Chile, Belgium, USA, Mexico, Spain, South Africa, Ecuador, China (Shanghai), China (Beijing). In case of complaints, these can be received through the specified channels or directly by the human resources teams deployed in all locations in the country, which are analyzed and investigated within a period not exceeding 30 days. In 2022, one report for Sexual Harassment was filed with the organization itself, as well as four reports for Workplace Harassment, three of which were filed with the organization and one with the Labor Authority. It is also worth mentioning that during 2022 there were no trainings on Workplace and Sexual Harassment. 5.6 OCCUPATIONAL SAFETY Workplace health and safety are material aspects of managing mining operations. For this reason, SQM has a permanent, systematic process to keep workers protected and safe in each of the tasks they perform in its operations. In addition to the role played by the Company in this important matter, the Chilean State has a regulatory function, enacting and enforcing regulations to protect and ensure worker health and safety. The Chilean Government, acting through the Ministry of Labor and Social Security, the Ministry of Health, and Sernageomin, oversees occupational health and safety standards at mining sites; in particular, Sernageomin supervises mining projects, among other tasks, and has exclusive powers to 5 OUR PEOPLE 64 enforce standards related to environmental conditions and the health and safety of persons engaged in mining-related activities. As mentioned above, SQM has a Sustainability, Ethics, and Human Rights Policy that sets out its commitment to the sustainable development of its business, as well as to guaranteeing Occupational Health and Safety and respect for the people who work at its facilities, the community, and its customers. To this end, it has a Risk Prevention and Occupational Health Management System capable of identifying, developing, and sustaining behaviors and conditions that guarantee the care of all those who work at the Company's sites, projects, and offices. This policy applies to all SQM operations. As part of the operationalization of its Occupational Health and Safety (OHS) commitments, SQM has developed an Integrated Occupational Health and Safety System, the purposes of which are as follows: • To establish obligations and responsibilities in order to adopt all necessary measures to effectively protect and safeguard the life and health of all employees working at SQM, including contractors and subcontractors. • To define and establish standards to control all risks inherent to the processes, in order to define and set the minimum specifications for Occupational Health and Safety Management. • To safeguard the facilities, equipment, machinery, and all critical materials related to SQM's operations and processes. As part of the implementation of the Occupational Health and Safety management system, SQM has developed an Operational Risk Management System (SISGRO), which contains a series of activities grouped into 13 elements: 1.- Leadership 2.- Behavior- Based Prevention 3.- Health and Safety Joint Committee 4.- Incident reporting and investigation 5.- Field Activities 6.- Legality 7.- Control of Contractors 8.- Personal Protection Elements 9.- Occupational hygiene and health 10.- Emergency Plans 11.- Training 12.- Order and cleanliness 13.- Management System Audit 5 OUR PEOPLE 65 All these SISGRO activities are integrated into the Operational Excellence Program, called M1, which allows us to homologate the tools of the M1 Lean system to risk management, thus obtaining better results. The following are the main indicators of SQM's Occupational Health and Safety management, which correspond only to management in Chile. We are updating our internal processes so that this information is available soon. Regarding the Occupational Safety goals for the "Accident Rate per 100 workers", "Occupational Illness Rate per 100 workers" and "Average Days Lost due to accidents", the information is not available, since the targets have yet to be defined as requested by NCG 461. We expect to define these targets in the medium term. It should be noted that additional OHS indicators corresponding to Sustainability Accounting Standards Board (SASB) metrics are reported in item 8.2 of this Report. Occupational Safety Goals by Type of Indicators Type of Indicators Accident rate per hundred workers Fatality rate per hundred thousand workers Rate of Occupational Diseases per hundred workers Average days lost due to accidents Occupational Safety Indicators by Type of Indicators Type of Indicators Accident rate per hundred workers Fatality rate per hundred thousand workers Rate of Occupational Diseases per hundred workers Average days lost due to accidents Fatality rate (or mortality) Type of Employees Direct Employees Contrators SQM Total Note: Calculation factor for 200 thousand hours. 5.7 POSTNATAL LEAVE 2022 0 0 0 2022 N/D 0 N/D N/D 2022 0.31 0 0.13 41.74 We do not have a policy on this matter; however, we comply with the current legal regulations in Chile, granting pre- and postnatal leave as appropriate. The data reported correspond only to Chile. Data for the countries where we operate is not available; we are working internally on our internal systems so that this information is available in the medium term. It should be noted that the difference in women eligible for and those who availed themselves of the normal and/or parental postnatal period is mainly due to the fact that there are two women who will take their postnatal leave in 2023. They were counted as eligible since they made use of their prenatal leave, which continued into 2023. 5 OUR PEOPLE 66 Direct Employees eligible to make use of the Postnatal by Position Category, Gender and Country in 2022 Postion Category Gender Chile Senior Management Managers Division Head Operators Sales Force Administrator Auxiliary Other Professionals Other Technicians Subtotal Total Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female Male Female 0 0 0 0 12 1 90 8 0 0 0 2 0 0 44 29 50 3 196 43 239 Number and Percentage of Employees who used the Postnatal (normal and parental) by Position Category and Country in 2022 Women Men Position Category N° 0 0 12 90 0 0 0 44 50 196 Note: in the case of men, the 5-day postnatal period is reported. Senior Management Managers Division Head Operators Sales Force Administrators Auxiliary Other Professionals Other Technicians Total % 0.0% 0.0% 0.4% 3.3% 0.0% 0.8% 0.0% 11.3% 1.3% 17.2% N° 0 0 1 8 0 2 0 27 3 41 % 0.0% 0.0% 5.0% 37.7% 0.0% 0.0% 0.0% 18.4% 20.9% 82.0% Average Days Used by the Own Staff for making use of the Postnatal by Position Category, Gender and Country in 2022 Postion Category Gender Chile Senior Management Managers Division Head Operators 5 OUR PEOPLE Male Female Male Female Male Female Male 0 0 0 0 5 84 5 67 Sales Force Administrator Auxiliary Other Professionals Other Technicians Average Days Female Male Female Male Female Male Female Male Female Male Female Male Female 84 0 0 0 84 0 0 5 86 5 84 5 84 5.8 TRAINING AND BENEFITS SQM employees receive ongoing training on relevant topics, in line with their functions, to support their professional development and performance excellence. During the 2022 period, training totaled 140,185 hours. At the company level, the average number of training hours per employee reached 20 hours. Women in our company completed 21,735 hours of training, representing 15.5% of total training hours. Training was predominantly received by Operators, who completed 58,913 hours of training, followed by Other Professionals, with 34,973 hours of training. In terms of average hours of training per employee, however, 25.5 hours of training per employee were recorded for the Management category. A total of 6,232 employees were trained, representing 89.1% of the Company's workforce as of December 31, 2022. US$885 thousand were invested in training, which includes Company and SENCE costs. Training represents 0.01% of the company's annual revenues. Average Training Hours Total Company in 2022 Position Category Training Hours Average Hours of Training per Employee Senior Management Managers Division Head Operator Sales Force Administrator Auxiliary Other Professionals Other Technicians Total 146 1,383 17,677 58,913 48 783 32 34,973 26,230 140,185 8.1 11.3 25.5 20.7 0.7 6.5 4.6 18.2 21.9 20.0 Note: average training hours are calculated based on the number of employees as of December 31, 2022. 5 OUR PEOPLE 68 Average Training Hours Women in 2022 Position Category Training Hours Average Hours of Training per Employee Senior Management Managers Division Head Operator Sales Force Administrator Auxiliary Other Professionals Other Technicians Total 77 490 2,930 4,319 37 495 0 11,799 1,588 21,735 38.5 27.2 23.1 18.8 0.9 6.1 0.0 15.8 12.7 15.9 Note: average training hours calculated based on the number of employees as of December 31, 2022. Average Training Hours Men 2022 Position Category Training Hours Average Hours of Training per Employee Senior Management Managers Division Head Operator Sales Force Administrator Auxiliary Other Professionals Other Technicians Total 69 893 14,747 54,594 11 288 32 23,174 24,642 118,450 4.3 8.6 26.1 20.9 0.3 7.2 5.3 19.7 23.0 21.1 Note: average training hours calculated based on the number of employees as of December 31, 2022. Main Training Program Name of the Programs Description of the Programs No. of Participants Emergency Response Team Strengthen knowledge and techniques for the Emergency Response Teams from all localities Legal Certification Accredit for 4 years the personnel that handles mobile equipment in all the company's tasks. Management Specialty Deliver the necessary knowledge to the workers and workers so that they can fulfill their tasks. Development Skills Training programs in adaptive skills, strategic alignment or team strengthening. Languages Strengthen the English language for those people whose position requires it. Risk Prevention Topics associated with everything related to caring for people. 1,546 1,579 2,490 942 70 17,004 5 OUR PEOPLE 69 SQM Learning Internal learning platform with both internal and external training resources available to all SQM personnel. 9,026 Main Training Lectures Name of the Lecture Descripción de los Programas N° de Participantes Influence and Leadership Introduction to Ed Successfactors Platform Onboarding SQM (DO, RRHH, Inclusion & Diversity, Compliance, Sustainability, Safety) Increase your Leadership 2022 SQM Women Leadership Strategic Alignment workshop Advanced Analytics Aspirations workshop 2023 Aspirations and Common Objective workshop Mantenance division Alignment workshop Leadership Leaders community Benefits Lectures for all the company's supervisors, as a way of accompanying their professional and personal development. Generate a group learning space in relation to the role of M1 leadership, its behaviors and abilities. 112 660 172 27 24 7 14 19 147 83 401 We care about our workers, their welfare, and that of their families, so we have an area in the company exclusively dedicated to overseeing the benefits we provide to our workers. The area is responsible for their monitoring and coordination, so that they are available to every member of the organization in a timely and effective manner. The benefits provided are for those who have a permanent contract; some of them are provided for in the legislation in force, while others are company-specific or optional for employees. There are also benefits that are contained in each collective bargaining agreement, depending on the interests of the unions and their composition. Our benefits are: • Life insurance for the employee in case of natural death, accidental death, or disability; supplemental health insurance; catastrophic health insurance, and dental insurance. • Agreements with clinics to provide care for workers or their dependents covered by comfort letters; agreements with gymnasiums and telephone companies for preferential plans. • Scholarships for higher education studies for children of employees with outstanding performance and scholarships for undergraduate and graduate studies for employees with outstanding performance. • Celebration of commemorative dates in offices and workplaces: Father's Day, Mother's Day, Women's Day, Secretary's Day, Mining Day, and Labor Day. • Christmas box for the employee and their family. • Gift upon the birth of a child for employees with a permanent contract. 5 OUR PEOPLE 70 • Christmas gifts for children and/or dependents from 0 to 12 years old. • Birthday gift for all employees with fixed-term or permanent contracts • Annual salary review in October, based on a comparative study of salaries established by other companies in the comparable industry, which allows us to define an equitable and transparent remuneration for all employees who are not subject to collective bargaining agreements or contracts. • Group Voluntary Pension Savings Agreement (APVG): a monthly contribution is made by the company in the form of an Agreed Deposit to encourage pension savings by employees. Indemnity for all events with different characteristics according to role. • • Christmas and Independence Day bonuses. • Special bonuses for schooling, mortuary assistance, marriage, and birth. • Leaves of absence for death, marriage, for exams such as mammograms or prostate exams, and for moving house. 5.9 SUBCONTRACTING POLICY We do not have a Subcontracting Policy as such; however, we do have internal documents such as the Code of Ethics, the Code of Conduct for Business Partners, the Sustainability, Ethics, and Human Rights Policy, the Responsible Sourcing Policy, the Procurement Procedure, the Service Contracting Procedure, among others, which allow us to define the guidelines that we consider when selecting contractors and subcontractors and/or any other business partner such as: suppliers, distributors, agents, consultants, representatives, intermediaries, joint business partners, and any other third party. In addition, we are committed to complying with all laws, rules, and regulations of the countries where we operate, acting with the highest standards of integrity. Our goal is to build honest, clear, fair, and lasting relationships with all our business partners associated with the Company or any of SQM's subsidiaries around the world. We also seek to extend our commitments to sustainability, good labor practices, and human rights to our supply chain, with a view to promoting responsible and sustainable sourcing. We therefore commercially and contractually urge our suppliers to protect their employees' health and safety, to respect their labor and human rights, and to protect the environment. To this end, we have progressively incorporated the criteria of sustainability and compliance with suitable working conditions in our evaluations, in the continuous monitoring and risk assessment of our suppliers, and we have also incorporated criteria associated with our regulatory documents in our purchasing decisions for inputs and services. On the other hand, we have an Operational Risk Management System (SISGRO) that allows us to verify that service providers (contractors and subcontractors) comply with all the legal provisions in force in our country for their good performance. The Contract Bases establish the accident rates that must be met by any company wishing to provide services to SQM, which must always be "at or below" the ranges established for the economic activity, and also establish that all companies are required to implement a Risk Prevention Program aligned with SQM's Integral Occupational Health and Safety Management System. Along the same lines, we regularly monitor labor variables to measure all contractors' compliance with labor and social security obligations. External companies are monitored for employee health and safety, basic sanitary and environmental conditions in the workplace, health and safety management systems, the establishment and operation of joint committees, and compliance with labor legislation. During 2022, 5 OUR PEOPLE 71 the emphasis was on ensuring compliance with Covid-19 protocols, in order to protect workers and reduce the risk of contagion. In addition, coordination meetings are held between the principal's professional manager, its prevention department ,and a representative of each contractor and subcontractor, the first of which is held at the beginning of each contract. SQM's Controls for Contractors and Subcontractors • That they be advised by an Expert in Occupational Risk Prevention, according to the number of workers they have. • That they constitute their own Joint Committee. • That the Joint Committees operate as provided for by law. • That the Joint Committees send their committee meeting minutes to the Technical Administrator of the contract. • That worker's representatives be invited to participate in training activities and meetings of the Site Joint Committee. • That they have drawn up and delivered their internal regulations to their workers. • That they inform their workers of their occupational hazards. • That their employees have and effectively use Personal Protective Equipment. Responsible Sourcing Policy This Policy establishes criteria for responsible sourcing, which our suppliers shall progressively incorporate in their organizations in order to ensure a human rights-compliant supply chain. The Policy is structured based on the 5 pillars of the Sustainability, Ethics, and Human Rights Policy: (i) Ethics and Corporate Governance; (ii) Employees; (iii) Value Chain; (iv) Environment and Sustainable Development; and (v) Communities. The criteria to be met by SQM's suppliers to ensure responsible sourcing throughout its supply chain are established for each pillar. Responsible Sourcing Policy Compliance Criteria Ethics and Corporate Governance • Expressly commit to the fundamental human rights and business pillars of "protect, respect, and remedy". • Fully comply with anti-corruption laws when working on behalf of SQM. • Ensure that processes and supply chains are free of minerals from conflict zones. • Ensure that no direct or indirect funding or benefits are provided to armed groups in countries at to in https://www.oecd.org/daf/inv/mne/OECD-Due-Diligence-Guidance-Minerals. guidelines, according published conflict OECD zones • Combat money laundering, terrorist financing, and non-state armed groups. The requirements of our SQM Code of Ethics must also be considered. Workers • Reject outright all forms of child labor. • Expressly commit to the eradication of forced labor or any other type of modern slavery. • Avoid wage discrimination by hiring, promoting, and making employment decisions based on objective criteria. 5 OUR PEOPLE 72 • Conduct a blind recruitment process, evaluating applicants according to their competencies and requirements for the position, with no discrimination of any kind. • Have a retrenchment plan or policy in place. • Guarantee and promote the freedom and fundamental rights of workers. • Respect workers' right to privacy and personal information. • Have an anonymous, confidential, and non-retaliatory whistleblower channel, available to all workers and managed by an independent company specializing in this area. • Train managers and executives on the prevention of workplace harassment and harassment • culture. Implement an operational risk prevention and occupational health management system based on international standards, with a view to eliminating work-related deaths and injuries. • Continuously train personnel to ensure a safe working environment and safe working conditions. • Promote and exercise control in operations and facilities to ensure that they are alcohol- and drug-free workplaces. Value Chain • Disseminate this Policy to company managers. • Undergo evaluation by SQM. • Ensure the quality of processes and products/services through adequate risk management and analysis. • Maintain permanently updated information on the products used and/or produced and their potential effects on health and safety. Environment and Sustainable Development • Comply with environmental regulations. • Have an impact management system in place to minimize and mitigate potential environmental impacts in a timely manner. • Ensure the responsible and efficient use of natural resources. Communities • Unrestricted respect for human dignity and the fundamental rights of individuals. • Identify social impacts and risks on communities that may be affected by the Company's operations. • Promote, as required by the regulations in force, citizen participation and provide transparent and timely information regarding our projects, as well as periodically reporting on environmental issues. • Promote citizen participation with indigenous relevance and prior, free, informed, and good faith consultation with the communities potentially affected by projects, as required by the legislation in force and when pertinent. • Comply with all such obligations it has undertaken with the communities. We encourage our suppliers to progressively comply with the responsible sourcing criteria set out in this Policy within their company and to implement it throughout their supply chains. 5 OUR PEOPLE 73 6. OUR BUSINESS 6.1 INDUSTRIAL SECTOR SQM is an integrated producer and distributor of specialty plant nutrients, iodine and derivatives, lithium and derivatives, potassium fertilizers, and industrial chemicals. The Company's products are derived from high-quality natural resources that allow SQM to be a cost leader, supported by a specialized international distribution network with sales in more than 110 countries. According to the Sustainable Industry Classification System (SICS), SQM belongs to the Chemical Substances industry. The Company is registered in the Securities Registry of the CMF, under No. 184 of March 18, 1983, and, therefore, is subject to the supervision of this entity. By having its shares traded on the New York Stock Exchange through an ADR (American Depository Receipts) program, the Company is also subject to the regulations established by the United States Security and Exchange Commission (SEC) applied to foreign issuers. such as SQM. We believe that we are the world’s largest producer of lithium, iodine and potassium nitrate. We also produce specialty plant nutrients, lithium and iodine derivatives, potassium chloride, potassium sulfate and certain industrial chemicals (including industrial nitrates and solar salts). Our products are sold in more than 110 countries through our worldwide distribution network, with 98% of our sales in 2022 derived from countries outside Chile. Our products are currently derived primarily from mineral deposits found in northern Chile. We mine and process caliche ore and brine deposits. The caliche ore in northern Chile contains the only known nitrate and iodine deposits in the world and is the world’s largest commercially exploited source of natural nitrates. The brine deposits of the Salar de Atacama, a salt-encrusted depression in the Atacama Desert in northern Chile, contain high concentrations of lithium and potassium as well as significant concentrations of sulfate and boron. From our caliche ore deposits, we produce a wide range of nitrate-based products used for specialty plant nutrients and industrial applications, as well as iodine and iodine derivatives. At the Salar de Atacama, we extract brines rich in potassium, lithium, sulfate and boron in order to produce potassium chloride, potassium sulfate, lithium solutions and bischofite (magnesium chloride). We produce lithium carbonate and lithium hydroxide at our plant near the city of Antofagasta, Chile, from the solutions brought from the Salar de Atacama. Information about the Company's results is disclosed based on six operating segments, in accordance with IFRS requirements: specialty plant nutrients, iodine and derivatives, lithium and derivatives, industrial chemicals, potassium, and other products and services. Specialty plant nutrients are premium fertilizers that enable farmers to improve yields and the quality of certain crops. Iodine and its derivatives are mainly used in the X-ray contrast media and biocides industries and in the production of polarizing film, which is an important component in LCD screens. Lithium and its derivatives are mainly used in batteries, greases and frits for production of ceramics. Potassium chloride is a commodity fertilizer that is produced and sold by us worldwide. Industrial chemicals have a wide range of applications in certain chemical processes such as the manufacturing of glass, explosives and ceramics, solar thermal use and metal treatment. In addition, SQM complements 6 OUR BUSINESS 74 its portfolio of plant nutrients through the purchase and sale of other commodity fertilizers, mainly for use in Chile. The following table shows the percentage breakdown of our revenues for 2022, 2021 and 2020 according to our product lines: Specialty Plant Nutrition Iodine and Derivatives Lithium and Derivatives Potassium Industrial Chemicals Other Total Total (in US$ millions) 2022 11% 7% 76% 4% 2% 0% 100% 2021 32% 15% 33% 15% 5% 1% 100% 2020 39% 18% 21% 12% 9% 2% 100% 10,710.6 2,862.3 1,817.2 For the year ended December 31, 2022, we had revenues of US$10,720.6 million, gross profit of US$5,736.6 million and profit attributable to controlling interests of US$3,906.3 million. Our worldwide market capitalization as of December 31, 2022 was approximately US$21.5 billion. Within its industrial sector, the Company faces competition from other manufacturers of chemical products similar to those produced and distributed by SQM. Details of the Company's main competitors are presented by their respective markets in section 6.2 Business Segments. The main SQM’s stakeholders are presented in section 6.3 Stakeholders. 6 OUR BUSINESS 75 LEGAL OR REGULATORY FRAMEWORK Regulations in Chile Generally We are subject to the full range of government regulations and supervision generally applicable to companies engaged in business in Chile, including labor laws, social security laws, public health laws, consumer protection laws, tax laws, environmental laws, fair competition laws, and securities laws. These include regulations to ensure sanitary and safety conditions in manufacturing plants. We conduct our mining operations pursuant to judicial exploration concessions and exploitation concessions granted pursuant to applicable Chilean law. Exploitation concessions essentially grant a perpetual right (with the exception of the Salar de Atacama rights, which have been leased to us until 2030) to conduct mining operations in the areas covered by such concessions, provided that annual concession fees are paid. Exploration concessions permit us to explore for mineral resources on the land covered thereby for a specified period, and to subsequently request a corresponding exploitation concession. Under Law No. 16,319 that created the Chilean Nuclear Energy Commission (Comisión Chilena de Energía Nuclear), or “CCHEN”, we have an obligation to the CCHEN regarding the exploitation and sale of lithium from the Salar de Atacama, which prohibits the use of lithium for nuclear fusion. In addition, CCHEN has imposed quotas that limit the total tonnage of lithium authorized to be sold, along with other conditions. We also hold water use rights granted by the respective administrative authorities and which enable us to have a supply of water from rivers or wells near our production facilities sufficient to meet our current operating requirements. See section 3.6 Risk Factors. We operate port facilities at Tocopilla, Chile for the shipment of products and the delivery of raw materials in conformity with maritime concessions, which have been granted by the respective administrative authorities. These concessions are normally renewable on application, provided that such facilities are used as authorized and annual concession fees are paid. In 2005, Law No. 20,026, known as the “Law to Establish a Specific Tax on Mining Activity” (Ley que Establece un Impuesto Específico a la Actividad Minera) or the “Royalty Law”, established a tax to be applied to mining activities developed in Chile. In 2010, modifications were made to the Royalty Law and taxes were increased. On February 24, 2020, Law No.21,210 the “Law to Modernize the Tax Legislation” was published. As a result of these reforms, open stock corporations, such as SQM, are subject to the general corporate tax rules. The corporate tax rate that applies to us increased to 27% in 2018. We are also subject to the Chilean Labor Code and the Subcontracting Law, which are overseen by the Labor Authority (Dirección del Trabajo), the National Geology and Mining Service (Servicio Nacional de Geología y Minería) or “Sernageomin”, and the National Health Service. In addition, we are subject to Law No. 20,393, which establishes criminal liability for legal entities, for crimes such as, (a) asset laundering, (b) financing terrorism, (c) bribery and (d) obliging employees to breach sanitary restrictions ordered by the local authorities. Potential sanctions for violations under this law could include (i) fines, (ii) loss of certain governmental benefits during a given period, (iii) a temporary or permanent bar against the corporation executing contracts with governmental entities, and (iv) dissolution of the corporation. 6 OUR BUSINESS 76 We are subject to the Securities Market Law and Law No. 18,046 on Corporations (Ley de Sociedades Anónimas) or the “Chilean Corporations Act”, which regulates corporate governance of public companies. Specifically, the Chilean Corporations Act regulates, among other things, independent director requirements, disclosure obligations to the general public and to the CMF, as well as regulations relating to the use of inside information, the independence of external auditors, and procedures for the analysis of transactions with related parties. Law No. 21,455, which was published in the Official Gazette on June 21, 2022, establishes a legal framework for facing the challenges derived from climate change and complying with the Chilean State’s international commitments regarding such issue. Law No. 21,455, amends the Chilean Corporations Act to recquire open stock corporations registered in the Securities Register to periodically provide information to CMF in connection with the impact of their activities on the environment and climate change. Law No. 21,521, which was published in the Official Gazette on January 4, 2023, seeks to promote competition and financial inclusion in financial services through innovation and technology. Law No. 21,521 regulates the following financial services: (i) crowdfunding platforms; (ii) alternative systems for the transaction of financial instruments or securities; (iii) credit advice; (iv) investment advice (v) custody of financial instruments; (vi) order routing, and (vii) intermediation of financial instruments. In addition, Law No. 21,521 amends the Chilean Corporations Act to increase by 2,000 (or the higher number determined by the CMF) the number of shareholders that a closed corporation must have to be required to register its shares in the Securities Registry and become an open stock corporation. Law No. 21,521 also amends the Securities Market Law to establish a simplified regime for debt securities, which will be detailed by the CMF. There are currently no material legal or administrative proceedings pending against the Company except as discussed in section 8.1 of this report. Safety, Health and Environmental Regulations in Chile Our operations in Chile are subject to both national and local regulations related to safety, health and environmental protection. In Chile, the main regulations on these matters that are applicable to us are the Mine Health and Safety Act of 1989 (Reglamento de Seguridad Minera or the “Mine Health and Safety Act”), the Health Code (Código Sanitario), the Health and Basic Conditions Act of 1999 (Reglamento sobre Condiciones Sanitarias y Ambientales Básicas en los Lugares de Trabajo or the “Health and Basic Conditions Act”), the Subcontracting Law, the Environmental Law of 1994, amended in 2010 (Ley sobre Bases Generales del Medio Ambiente or the “Environmental Law”) and Law No.16,744 of the Labor Code relating to workplace accidents and occupational diseases (“Law No. 16,744”). Health and safety at work are fundamental aspects in the management of mining operations, which is why we have made constant efforts to maintain good health and safety conditions for the people working at our mining sites and facilities. In addition to the role played by us in this important matter, the Chilean government has a regulatory role, enacting and enforcing regulations in order to protect and ensure the health and safety of workers. In November 2011, the Ministry of Mining enacted Law No. 20,551 that regulates the closure of mining sites and facilities (Ley que Regula el Cierre de Faenas e Instalaciones Mineras). This statute entered became effective in November 2012 and required all mining sites to present or update their closure plans as of November 2014. SQM has fulfilled this requirement for all of its mining sites and facilities. The main requirements of the law are related to disclosures to the Sernageomin regarding decommissioning plans for each mining site and its facilities, along with the estimated cost to implement such plans. The 6 OUR BUSINESS 77 mining site closure plans are approved by Sernageomin and the corresponding financial assurances are subject to approval by the CMF. In both cases, SQM has received the requisite approvals. During 2020, any required closure plans were updated and presented to Sernageomin in accordance with required deadlines. In 2022, updates of the Pedro de Valdivia and Tocopilla sites were approved and the process continued according to the comments received. During 2022, Sernageomin approved the updates to the closure plans of the Salar de Atacama, Carmen lithium chemical plant, Coya Sur, Nueva Victoria and Orcoma. The approval updates for the closure plans of the Pampa Blanca and Maria Elena sites are still pending. Also, over time, new environmental standards and regulations have been enacted, which have required minor adjustments or modifications of our operations. There can be no assurance that future legislative or regulatory developments will not impose new restrictions on our operations. We are committed to continuously improving our environmental performance through our Environmental Management System (“EMS”). Since our sustainable development plan was announced, we have participated in voluntary qualifications such as Ecovadis, international certifications such as Responsible Conduct from the Association of Chemical Industries of Chile, Protect&Sustain from the International Fertilizer Association, ISO 14001, ISO 45001 and ISO 50001, and the Standard IRMA Certification Audit, to promote responsible mining. In 2021, the Port of Tocopilla was certified for Responsible Conduct, obtaining level 2 certification. Likewise, during 2022, the Nueva Victoria Site was recertified, obtaining level 1 certification. On the other hand, the Protect&Sustain certification applies to the operations of Coya Sur, Salar de Atacama, Antofagasta, Santiago and the Port of Tocopilla. During 2022, the external IRMA certification audit (phase 2) began in the Salar de Atacama operation, and we expect to receive the final results during 2023. Regarding the ISO management systems, the Port of Tocopilla was certified in January 2022 in ISO 14001. We completed the phase 2 of ISO 14001 and 45001 certification process in the Salar de Atacama and the Carmen chemical plant, and continued with the implementation process of ISO 50001 in the Salar de Atacama and Nueva Victoria to support decarbonization goals associated with energy management systems. During 2022, we participated in the Dow Jones Sustainability Indices (DJSI) assessment and were accepted into the MILA and Chile indices for the third consecutive year and were included in the Sustainability Yearbook 2023. We evaluated ourselves in Carbon Disclosure Project (CDP) where we received a category B rating, which is in the management band, higher than the South American region average (category C) and higher than the Chemicals sector average (category B-). We have submitted and will continue to submit environmental impact assessment studies related to our projects to the governmental authorities. We require the authorization of these submissions in order to maintain and to increase our production capacity. International Regulations We are subject to complex regulatory requirements in the various jurisdictions in which we operate, including the following implemented during 2022: 6 OUR BUSINESS 78 In 2019, Regulation (EU) 2019/1009 was published, which establishes provisions regarding the marketing of fertilizing products and repeals Regulation (EC) No. 2003/2003. Regulation (EU) 2019/1009 entered into force in July 2022 and changed the way fertilizers are placed in the EU market. All products manufactured by SQM in Chile meet the requirements of Regulation (EU) 2019/1009 and the applicable type of conformity assessment has been carried out. We have also evaluated and continue to evaluate if raw materials from third parties for the manufacturing of water soluble NPK formulas produced in The Netherlands and Spain meet the new requirements of Regulation (EU) 2019/1009. We continue our active participation as a member of the Standing Committee on Precursors of the European Commission, which monitors and assists in the implementation of Regulation (EU) 2019/1148 on the marketing and use of explosive precursors. The invoices and safety data sheets of our products covered by Regulation (EU) 2019/1148 inform of such a condition so that our European users are informed and can take the pertinent measures. Regulation (EC) 1907/2006 (REACH) is the main framework for chemical’s control in the EU. SQM has acted as lead registrant for four substances: iodine, sodium nitrate, potassium nitrate and urea phosphate. During 2022, the EU REACH iodine dossier was successfully updated, and we continue the process for the other three substances with the aim of updating their dossiers during 2023. At the end of 2022, Commission Regulation (EU) 2020/878 replaced Annex II to REACH introducing changes to safety data sheets, a key hazard communication tool. SQM adjusted its documents to the new format accordingly. Commission Delegated Regulation (EU) 2021/849 amended Part 3 of Annex VI to Regulation (EC) No 1272/2008 which introduced new concentration limits for boric acid, a micronutrient used in water soluble NPK formulas. This amendment is effective beginning December 2022 and the hazard classification of all formulas containing boric acid were reviewed and updated when needed. Downstream users were all notified accordingly. In other jurisdictions, in 2022 we continued our work for the registrations of products under other similar chemicals control regulations, including UK REACH, Turkey REACH and Korea REACH. In the field of international transport, SQM actively participated through the Chilean Chemical Industry Association in the 36th and 37th meetings of the Editorial and Technical Group and the 8th meeting of the Sub-Committee on Carriage of Cargoes and Containers of the International Maritime Organization (IMO) proposing new entries for potassium nitrate and sodium nitrate in the IMSBC Code and modifications to SP 964 in the IMDG Code. Research and Development, Patents and Licenses One of the main objectives of our research and development team is to develop new processes and products in order to maximize the returns obtained from the resources that we exploit. Our research is performed by three different units, whose research topics cover all of the processes involved in the production of our products, including chemical process design, phase chemistry, chemical analysis methodologies and physical properties of finished products. Our research and development policy emphasizes the following: (i) optimizing current processes in order to decrease costs and improve product quality through the implementation of new technology, (ii) developing higher-margin products from current products through vertical integration or different product specifications, (iii) adding value to inventories and (iv) using renewable energy in our processes. 6 OUR BUSINESS 79 Our research and development activities have been instrumental in improving our production processes and developing new value-added products. As a result, new methods of extraction, crystallization and finishing products have been developed. Technological advances in recent years have enabled us to improve process efficiency for the nitrate, potassium and lithium operations, improve the physical quality of our prilled products and reduce dust emissions and caking by applying specially designed additives to our products handled in bulk. Our research and development efforts have also resulted in new, value- added markets for our products. One example is the use of sodium nitrate and potassium nitrate as thermal storage in solar power plants. The Company has patented various production processes for nitrate, iodine and lithium products. These patents have been registered mainly in the United States of America, Chile and other countries, when necessary. The patents used in SQM's production processes are Chilean patent No. 47,080 for iodine (production of spherical-shaped granules for products that sublime) and Japan patent No. 4,889,848 for nitrates (granular fertilizers). 6 OUR BUSINESS 80 6.2 BUSINESS LINES Lithium and Derivatives SQM is one of the world's leading producers of lithium carbonate, which is used in a wide variety of applications, including electrochemical materials for batteries (electric vehicles, laptops, tablets, cell phones, electronic devices), frits for ceramic and metal surfaces, heat resistant glasses (ceramic glass), air conditioning chemicals, casting powder for steel extrusion, pharmaceuticals and lithium derivatives. In addition, the Company is a leading supplier of lithium hydroxide, which is used primarily as a raw material in the cathode industry for high-energy capacity batteries and lubricating greases. In 2022, our revenues from lithium sales amounted to US$8,152.9 million, representing 76.1% of our total revenues. We believe we are one of the world’s largest producers of lithium carbonate and lithium hydroxide, and we estimate that our sales volumes accounted for approximately 20% of the global lithium chemicals sales volumes. The following table shows our total production and sales volumes, and revenues from lithium and its derivatives for 2022, 2021 and 2020: Lithium and Derivatives Production volumes (Th. metric tons) Sales Volumes (Th. metric tons) Revenues (in US$millions) 2022 168.4 156.8 8,152.9 2021 119.8 101.1 936.1 2020 81.3 64.6 383.4 Our revenues in 2022 were US$8,152.9 million, a 771% increase from US$936.1 million in 2021, due to higher average prices and higher sales volumes during the year. The average price for 2022 was approximately 462% higher than the average price in 2021. Our sales volumes increased approximately 55% in 2022. The lithium and lithium derivatives segment contributed approximately 79% to the Company's consolidated gross margin in 2022. Lithium: Market The lithium market can be divided into (i) lithium minerals for direct use (a market in which SQM does not participate directly), (ii) basic lithium chemicals, which include lithium carbonate and lithium hydroxide (as well as lithium chloride, from which lithium carbonate may be made), and (iii) inorganic and organic lithium derivatives, which include numerous compounds produced from basic lithium chemicals (a market in which SQM does not participate directly). Lithium carbonate and lithium hydroxide are principally used to produce the cathodes for rechargeable batteries, taking advantage of lithium’s extreme electrochemical potential and low density. Batteries are the leading application for lithium, accounting for approximately 90% of total lithium demand, including batteries for electric vehicles, which accounted for approximately 70% of total lithium demand in 2022. During 2022, lithium chemicals demand increased by approximately 43%, reaching approximately 760,000 metric tons. We expect applications related to energy storage to continue driving demand in the coming years. 6 OUR BUSINESS 81 Lithium: Marketing and Customers In 2022, we sold our lithium products in approximately 41 countries to approximately 198 customers, and most of our sales were to customers outside of Chile. One customer accounted for approximately 19% of our lithium revenue in 2022. Our ten largest customers accounted in the aggregate for approximately 60% of revenues. One supplier accounted for approximately 80% of the cost of sales of this business line. We make lease payments to Corfo which are associated with the sale of different products produced in the Salar de Atacama, including lithium carbonate, lithium hydroxide and potassium chloride. See Note 23.2 to our consolidated financial statements for the disclosure of lease payments made to Corfo for all periods presented. The following table shows the geographical breakdown of our revenues in 2022, 2021 and 2020: Revenues breakdown North America Europe Chile Central and South America (excluding Chile) Asia and Others 2022 2% 5% 0% 0% 93% 2021 5% 8% 0% 1% 86% 2020 7% 13% 0% 0% 80% We sell lithium carbonate and lithium hydroxide through our own worldwide network of representative offices and through our sales, support and distribution affiliates. We maintain inventories of these products at our facilities throughout the world to facilitate prompt delivery to customers. Sales of lithium carbonate and lithium hydroxide are made based on spot purchase orders or through different supply contracts. The contracts generally specify minimum and maximum annual sales volumes commitments while prices are adjusted periodically based on different price indices established in the market. Lithium: Competition Lithium is produced mainly from two sources: (i) concentrated brines and (ii) minerals. During 2022, the main lithium brines producers were Chile, Argentina and China, while the main lithium mineral producers were Australia and China. With total sales of approximately 156,800 metric tons of lithium carbonate and hydroxide, SQM’s market share of lithium chemicals was approximately 20% in 2022. The main competitors in the lithium market with their estimated market share are: Albemarle (16%), Tianqi Lithium Corp. (7%), Jiangxi Ganfeng Lithium Co (6%), Allkem (4%) and Livent Corporation (3%). Tianqi is also a major shareholder of ours, holding approximately 22.16% of our shares as of December 31, 2022. 6 OUR BUSINESS 82 Iodine and Derivatives believes that it is the world's leading producer of iodine and its derivatives, which are used in a wide range of medical, pharmaceutical, agricultural and industrial applications. In 2022, our revenues from iodine and iodine derivatives amounted to US$754.3 million, representing 7.0% of our total revenues in that year. We estimate that our sales accounted for approximately 33% of global iodine sales by volume in 2022. The following table shows our total sales volumes and revenues from iodine and iodine derivatives for 2022, 2021 and 2020: Iodine and its Derivatives Production volumes (Th. metric tons) Sales Volumes (Th. metric tons) Revenues (in US$millions) 2022 2021 2020 12.4 12.7 754.3 10.3 12.3 437.9 12.1 9.7 334.7 In 2022, our revenues from iodine and iodine derivatives amounted to US$754.3 million, an increase from US$437.9 million in 2021. This increase was primarily attributable to slightly higher sales volumes and significantly higher average prices during 2022. Average iodine prices were more than approximately 67% higher in 2022 than in 2021. Our sales volumes increased approximately 4% in 2022. The iodine and its derivatives segment contributed approximately 8% to the Company's consolidated gross margin in 2022. Iodine: Market Iodine and iodine derivatives are used in a wide range of medical, agricultural and industrial applications as well as in human and animal nutrition products. X-ray contrast media is the leading application of iodine- Iodine’s high atomic number and density make it ideally suited for this application, as its presence in the body can help to increase contrast between tissues, organs, and blood vessels with similar X-ray densities. Iodine and iodine derivatives are used as raw materials or catalysts in the formulation of products such as X-ray contrast media, biocides, antiseptics and disinfectants, pharmaceutical intermediates, polarizing films for LCD and LED screens, chemicals, organic compounds and pigments. Iodine is also added in the form of potassium iodate or potassium iodide to edible salt to prevent iodine deficiency disorders. The demand for iodine varies depending on the general levels of economic activity and the level of demand in the medical, pharmaceutical, industrial and other sectors that are the main users of iodine and its derivatives. Iodine substitutes are available for certain applications, such as antiseptics and disinfectants, which may represent a cost-effective alternative. The following chart shows the distribution of iodine demand for various applications in 2022: 6 OUR BUSINESS 83 Distribution of Iodine Demand in 2022 Others, 10% X-Ray Contrast Media, 31% Nylon, 3% Human Nutrition, 3% Biocides, 5% Fluroderivatives, 7% Animal Nutrition, 7% Iodophors and Povidone Iodine, 8% Pharmaceutical, 13% Polarizing Films (LCD and LED), 13% During 2022, the demand for iodine increased approximately 2% compared to 2021. Main drivers of this increase were in the X-ray contrast media market, in which demand grew by approximately 6% compared to 2021, mainly due to worldwide growth in the healthcare industry spending during the year and increased accessibility to these types of treatments in emerging economies, mainly China. Demand for other uses grew at historical growth rate. Growth in demand over supply led prices to increase during 2022. We manufacture our iodine and iodine derivatives in accordance with international quality standards and have qualified our iodine facilities and production processes under the ISO 9001:2015 program, providing third party certification of the quality management system and international quality control standards that we have implemented. Iodine: Marketing and Customers In 2022, we sold our iodine products in approximately 50 countries to approximately 258 customers, and most of our sales were exports. Two customers each accounted for more than 10% of our iodine revenues in 2022. These two customers accounted for approximately 41% of revenues, and our ten largest customers accounted in the aggregate for approximately 75% of revenues. No supplier accounted for more than 10% of the cost of sales of this business line. The following table shows the geographical breakdown of our revenues: Revenues breakdown North America Europe Chile Central and South America (excluding Chile) Asia and Others 2022 19% 38% 0% 2% 2021 23% 40% 0% 2% 2020 27% 42% 0% 3% 41% 34% 27% We sell iodine through our own worldwide network of representative offices and through our sales, support and distribution affiliates. We maintain inventories of iodine at our facilities throughout the world to facilitate prompt delivery to customers. Iodine sales are made pursuant to spot purchase orders or within the framework of supply agreements. Supply agreements generally specify annual minimum and maximum purchase commitments, and prices are adjusted periodically, according to prevailing market prices. 6 OUR BUSINESS 84 Iodine: Competition The world’s main iodine producers are based in Chile, Japan and the United States. Iodine is also produced in Russia, Turkmenistan, Azerbaijan, Indonesia and China. Iodine is produced in Chile from a unique mineral known as caliche ore, whereas in Japan, the United States, Russia, Turkmenistan, Azerbaijan, and Indonesia, producers extract iodine from underground brines that are mainly obtained together with the extraction of natural gas and petroleum. In China, iodine is extracted from seaweed. The following chart shows the distribution of iodine supply by country of origin in 2022: Iodine Supply Distribution in 2022 Others, 11% USA, 5% SQM, 33% Japan, 26% Chile (Others), 25% Five Chilean companies accounted for approximately 58% of total global sales of iodine in 2022, including SQM, with approximately 33%, and four other producers accounting for the remaining 25%. The other Chilean producers are Cosayach, ACF Minera S.A., Algorta Norte S.A. and Atacama Minerals. We estimate that eight Japanese iodine producers accounted for approximately 26% of global iodine sales in 2022, including recycled iodine. Iodine recycling is a growing trend worldwide. Several producers have recycling facilities where they recover iodine and iodine derivatives from iodine waste streams. We estimate the 17% of the iodine supply comes from iodine recycling. Through ASG or alone, we are also actively participating in the iodine recycling business using iodinated side-streams from a variety of chemical processes in Europe and the United States. The main factors of competition in the sale of iodine and iodine derivative products are reliability, price, quality, customer service and the price and availability of substitutes. We believe we have competitive advantages compared to other producers due to the size and quality of our mining reserves and the available production capacity. We believe our iodine is competitive with that produced by other manufacturers in certain advanced industrial processes. We also believe we benefit competitively from the long-term relationships we have established with our largest customers. Specialty Plant Nutrition We produce and distribute specialty plant nutrients which offer nutritional solutions primarily for fertigation applications on high value crops such as fruit, flowers and some vegetables. These fertilizers must be highly soluble and free of impurities in order to be used by means of modern technical irrigation techniques (drip irrigation, microaspiration). The latter are increasingly used in high-value fruit plantations as well as in protected crops: greenhouses, tunnels for berries and shade houses for tomatoes. In addition, 6 OUR BUSINESS 85 SQM participates in the specialty nutrient market for foliar and granular soil applications, in certain high- value niches such as potato production. Among the specialty plant nutrients for use in fertigation, potassium nitrate is one of the most important fertilizers. Its advantage lies in being chlorine free, high solubility, adequate PH and free of impurities. These advantages allow for a premium price compared to substitute commodity fertilizers such as potassium chloride and sulfate. We believe that we are the world’s largest producer of potassium nitrate. In 2022, specialty plant nutrients revenues increased to US$1,172.3 million, representing 10.9% of our total revenues for that year. We estimate that our sales accounted for approximately 45% of global potassium nitrate sales for all agricultural uses by volume in 2022. The following table shows the total production and sales volumes, and revenue of specialty plant nutrients for 2022, 2021 and 2020: Specialty Plant Nutrition Production volumes (Th. metric tons) Sodium nitrate Potassium nitrate and sodium potassium nitrate Specialty blends (1) Other specialty plant nutrients (2) Sales Volumes (Th. metric tons) Sodium nitrate Potassium nitrate and sodium potassium nitrate Specialty blends (1) Other specialty plant nutrients (2) Revenues (in US$millions) (1) Includes Yara’s products sold pursuant to our commercial agreement (2) Includes trading of other specialty fertilizers. 2022 2021 2020 18.4 550.9 217.9 138.1 14.4 477.4 217.9 138.1 50.2 76.6 679.1 635.8 304.0 271.3 174.9 164.4 25.6 32.1 643.6 575.2 304.0 271.3 174.9 164.4 1,172.3 908.8 701.7 In 2022, our revenues in specialty plant nutrients business line increased by 29% compared to the US$908.8 million for the previous year, as a result of the higher average prices during the year. Average prices during 2022 increased approximately 76%. The specialty plant nutrition segment contributed approximately 8% to the Company's consolidated gross margin in 2022. Specialty Plant Nutrition: Market The target market for specialty plant nutrients is farmers who produce high-quality crops such as vegetables, fruits, cash crops, flowers, cotton, and other high-value crops. In addition, SQM sells specialty plant nutrients to growers who maintain crops sensitive to chlorine. Since 1990, the international market for specialty plant nutrients has grown at a faster rate than the international market for commodity fertilizers. This is mainly due to: (i) the application of new agricultural technologies such as fertigation, hydroponics and greenhouses; (ii) the increase in the cost of land and the scarcity of water, which has forced farmers to improve their yields and reduce water use; and (iii) the increase in demand for higher quality crops. As an exception, during the year 2022 and due to the strong increase in price, the agricultural soluble potassium nitrate market had a consumption reduction of between 12% and 16%. These estimates do not consider potassium nitrate produced and sold locally in China, and only include net imports and exports. 6 OUR BUSINESS 86 Specialty Plant Nutrition: Marketing and Customers In 2022, we sold our specialty plant nutrients in approximately 103 countries and to more than 1,000 customers. None of our customers represented more than 10% of our specialty plant nutrition revenues during 2022, and our ten largest customers accounted in the aggregate for approximately 34% of revenues during that period. No supplier accounted for more than 10% of the costs of sales for this business line. The table below shows the geographical breakdown of our revenues: Revenues breakdown North America Europe Chile Central and South America (excluding Chile) Asia and Others 2022 42% 16% 11% 11% 20% 2021 35% 20% 15% 10% 21% 2020 35% 21% 14% 10% 20% We sell our specialty plant nutrition products globally mainly through our own worldwide network of commercial offices and distributors. We have developed marketing channels, brands (Ultrasol, Champion, Sangral, Qrop, Speedfol), supply chain, and mixing and packaging plants to be able to reach practically the entire world with our products and have a direct presence in the main markets of America, Europe, South Africa, and China. We maintain inventory of our specialty plant nutrients in our commercial offices in our main markets in order to facilitate prompt deliveries to customers. As part of our marketing strategy, we provide technical and agronomical assistance to our clients. We have specific knowledge resulting from extensive research and numerous studies conducted by our agronomical teams in close contact with producers throughout the world. The solid agronomical knowledge is key for the development of specific formulas and hydroponic and fertigation nutritional plans, which allows us to provide expert advice. During 2022 we continued with the growth in sales of differentiated fertilizers such as Ultrasoline (NPK+ME+Iodine), ProP for greater efficiency in phosphorus absorption and Prohydric which allows for fertilization and more efficient water use. Specialty Plant Nutrition: Competition The principal means of competition in the sale of specialty nutrients are product quality, logistics, agronomic service expertise and price. SQM is the world’s largest producer of potassium nitrate for agricultural use. Our sales accounted for approximately 45% of global agricultural potassium nitrate sales by volume during 2022. Potassium nitrate products compete indirectly with specialty substitutes and other commodities, which may be used by some customers in place of potassium nitrate, depending on the type of soil and crop to which the product will be applied. In the potassium nitrate market, the main competitors with their estimated market share are: Haifa Chemicals Ltd. (22%) and Kemapco (12%). In addition, there are several producers of potassium nitrate in China. Most of the Chinese production is used in the domestic market. Potassium We produce potassium chloride and potassium sulfate by extracting brines from the Salar de Atacama. Potassium chloride is a basic fertilizer, of which more than 60 million tons are produced worldwide and is 6 OUR BUSINESS 87 used to fertilize a wide variety of crops, including corn, rice, wheat, sugar, soybeans, and palm oil. At SQM it is mainly used as a raw material to produce the specialty fertilizer potassium nitrate. In 2022, our potassium chloride and potassium sulfate revenues amounted to US$437.2 million, representing 4.1% of our total revenues and a 5% increase compared to 2021, as a result of increased average prices offset by lower sales volumes. We estimate that we accounted for less than 1% of global sales of potassium chloride in 2022. The following table shows the total production and sales volumes and revenues for potassium chloride and potassium sulfate for 2022, 2021 and 2020: Potassium chloride and Potassium sulfate Production volumes (Th. metric tons) Sales Volumes (Th. metric tons) Revenues (in US$millions) 2022 984.0 480.5 437.2 2021 1,407.5 893.2 416.6 2020 1,475.6 726.7 209.3 In 2022, our revenues increased 5% from US$416.6 million in 2021, due to higher sales prices that were offset by a noticeable drop in sales volumes. The average price for 2022 was approximately 95.1% higher than the average price in 2021. Our sales volumes in 2022 were approximately 46% lower than our reported sales volumes in 2021. The Potassium segment contributed approximately 4% to the Company's consolidated gross margin in 2022. Potassium: Market During the last decade, growth in demand for potassium chloride, and for fertilizers in general, has been mainly due to a permanent growth in food supply. All of these factors contribute to fertilizer demand growth as a result of efforts to maximize crop yields and use resources more efficiently. We estimate that demand in 2022 reached approximately 61 million metric tons, a 14% decrease from approximately 70 million tons during 2021, mostly as a result of sanctions imposed on Belarus and Russia that limited supply, raised prices and affected demand. The following graph represents the distribution of potassium demand by type of crop in 2022: Potassium Demand Distribution in 2022 Wheat, 16% Other crops, 47% Corn, 14% Soybeans, 9% Sugar; 2% Rice, 12% 6 OUR BUSINESS 88 Potassium: Marketing and Customers In 2022, we sold potassium chloride and potassium sulfate to approximately 467 customers in approximately 32 countries. One individual customer accounted for more than 10% of our revenues of potassium chloride and potassium sulfate in 2022, representing approximately 11% of our revenues in the business line. We estimate that our ten largest customers accounted in the aggregate for approximately 49% of such revenues. No supplier accounted for more than 10% of the cost of sales of this business line. We make lease payments to Corfo which are associated with the sale of different products produced in the Salar de Atacama, including lithium carbonate, lithium hydroxide and potassium chloride. See Note 23.2 to our consolidated financial statements for the disclosure of lease payments made to Corfo for all periods presented. The following table shows the geographical breakdown of our revenues for 2022, 2021 y 2020: Revenues breakdown North America Europe Chile Central and South America (excluding Chile) Asia and Others 2022 16% 6% 15% 41% 22% 2021 14% 8% 12% 51% 14% 2020 19% 14% 11% 35% 21% Potassium: Competition SQM estimates that it contributed approximately 1% of global sales of potassium chloride in 2022. The biggest competitors, with their market share in 2022, are: Nutrien (21%), Uralkali (15%), Mosaic (13%) and Belaruskali (10%). Industrial Chemicals The Company produces and sells three industrial chemicals: sodium nitrate, potassium nitrate and potassium chloride. Sodium nitrate is used primarily in the production of glass, explosives, and metal treatment, metal recycling and the production of insulation materials, among other uses. Potassium nitrate is used in the manufacturing of specialty glass, and it is also an important raw material for the production of frits for the ceramics, enamel industries, metal treatment and pyrotechnics. Solar salts, a combination of potassium nitrate and sodium nitrate, are used as a thermal storage medium in concentrated solar power plants. Potassium chloride is a basic chemical used to produce potassium hydroxide, and it is also used as an additive in oil drilling as well as in food processing, among other uses. We have operational flexibility in producing industrial grade nitrates, because they are produced from the same process as their equivalent agricultural grades, needing only an additional step of purification. We may, with certain constraints, shift production from one grade to the other in response to market conditions. This flexibility allows us to maximize yields and to reduce commercial risk. In addition to producing industrial nitrates, we produce, market and sell industrial-grade potassium chloride. In 2022, our revenues from industrial chemicals were US$165.2 million, representing approximately 1.5% of our total revenues for that year. We believe that we are one of the world’s largest producers of industrial sodium nitrate and potassium nitrate. The following table presents the total production and sales volumes, and total revenues in 2022, 2021 and 2020: 6 OUR BUSINESS 89 Industrial Chemicals Production volumes (Th. metric tons) Sales Volumes (Th. metric tons) Revenues (in US$millions) Note: The level of activity of intermediate products is reported as production. 2022 156.0 147.0 165.2 2021 97.9 174.5 132.0 2020 213.8 225.1 160.6 Revenues for industrial chemicals increased to US$165.2 million in 2022 from US$132.0 million in 2021, as a result of higher sales volumes in this business line, which offset lower sales volumes. Sales volumes in 2022 decreased 16% compared to sales volumes reported last year, while average prices in the business line increased 47% during 2022 compared to average prices reported during 2021. The Industrial Chemicals segment contributed approximately 1% to the Company's consolidated gross margin in 2022. Industrial Chemicals: Market As already mentioned above, industrial sodium and potassium nitrates are used in a wide range of industrial applications, including the production of glass, ceramics and explosives, metal recycling, insulation materials, metal treatments together with other various chemical processes. In addition, this product line has also experienced growth from the use of industrial nitrates as thermal storage in concentrated solar power plants (commonly known as “CSP”). Solar salts for this specific application are a blend of 60% sodium nitrate and 40% potassium nitrate by weight ratio and are used as a storage and heat transfer medium in those power plants. Unlike traditional photovoltaic plants, these plants use a “thermal battery” that contains molten sodium nitrate and potassium nitrate, which store the heat collected during the day. The salts are heated up during the day, while the plants are operating under direct sunlight, and at night they release the solar energy that they have captured, allowing the plants to operate even during hours of darkness. Depending on the power plant technology, solar salts are also used as a heat transfer fluid in the plant system and thereby make CSP plants even more efficient, increasing their output and reducing the Levelized Cost of Electricity (LCOE). Thermal storage units based on Solar Salts (also known as Carnot batteries) are being developed decoupled from CSP plants. These units are specifically developed for large capacity and long duration energy storage. We expect a considerable growth of these storage units thanks to the efforts carried out worldwide to reduce the GHG emissions together with the dependence from fossil fuels. 6 OUR BUSINESS 90 Industrial Chemicals: Marketing and Customers In 2022, we sold our industrial nitrate products in approximately 58 countries, to approximately 261 customers. One customer accounted for more than 10% of our revenues of industrial chemicals in 2022, accounting for approximately 27.3%, and our ten largest customers accounted in the aggregate for approximately 54.6% of such revenues. No supplier accounted for more than 10% of the cost of sales of this business line. We make lease payments to Corfo which are associated with the sale of different products produced in the Salar de Atacama, including lithium carbonate, lithium hydroxide and potassium chloride. See Note 23.2 to our consolidated financial statements for the disclosure of lease payments made to Corfo for all periods presented. The following table shows the geographical breakdown of our revenues for 2022, 2021 and 2020: Revenues breakdown North America Europe Chile Central and South America (excluding Chile) Asia and Others 2022 36% 17% 1% 7% 39% 2021 23% 14% 3% 6% 55% 2020 15% 7% 3% 3% 72% Our industrial chemical products are marketed mainly through our own network of offices, logistic platforms, representatives and distributors. We maintain updated inventories of our stocks of sodium nitrate and potassium nitrate, classified according to graduation, to facilitate prompt dispatch from our warehouses. We provide support to our customers and continuously work with them to improve our service and quality together with developing new products and applications for our products. Industrial Chemicals: Competition The main competitors on refined grade sodium nitrate market are BASF AG, a German company, and various producers in China and Eastern Europe. All of them are highly competitive and produce synthetic sodium nitrate as a by-product of other chemical production processes. SQM's industrial sodium nitrate products also compete indirectly with substitute chemicals, including sodium carbonate, sodium sulfate, calcium nitrate and ammonium nitrate, which may be used in certain applications instead of sodium nitrate and sold by a large number of producers from around the world. The estimated market share of industrial sodium nitrate and potassium nitrate is reported in the following table: Industrial Sodium Nitrate Producer SQM BASF ............................. Asia and Others ............. Europe ........................... Chile (otros) .................. 2022 39% 28% 18% 10% 5% Industrial Potassium Nitrate 2022 60% 16% 9% 7% 5% 3% Producer SQM Asia and Others Haifa Chemicals Europe Kemapco Chile The main competitors in the industrial potassium nitrate business are Haifa Chemicals, Kemapco and some Chinese producers. Producers of industrial sodium nitrate and industrial potassium nitrate compete in the marketplace based on attributes such as product quality, delivery reliability, price, and customer service. Our operation offers both products at high quality and with low cost. 6 OUR BUSINESS 91 Other Products SQM also derives revenue from the commercialization of third-party fertilizers (specialty and commodity). These fertilizers are traded in large volumes worldwide and are used as raw material for our specialty mixes or to complement our product portfolio. We have developed commercial management, supply, flexibility and inventory management capabilities that allow us to adapt to the changing fertilizer market in which we operate and obtain profits from these transactions. Revenue from sales of other commodity fertilizers and other income reached US$28.6 million for the twelve months ended December 31, 2022, less than the US$30.8 million registered during the same period of 2021. New Business Ventures We constantly evaluate opportunities that are consistent with our existing and new businesses. We seek to acquire interests in projects both inside and outside of Chile where we believe we have sustainable competitive advantages, and we hope to continue doing so in the future. In addition, we are actively conducting exploration for metallic minerals in the mining properties we own. If such minerals are found, we may decide to exploit, sell or enter into an association to extract these resources. Our exploration efforts are currently focused on the layer of bedrock that lies beneath the caliche ore that we use as the primary raw material in the production of iodine and nitrates. This bedrock has significant potential for metallic mineralization, particularly copper, gold and silver. A significant portion of our mining properties are located in the Antofagasta region of Chile, where many large copper producers operate. We have an in-house geological exploration team that explores the area directly, identifying drilling targets and assessing new prospects. In 2021, the team has confirmed the existence of high-grade copper and gold mineralization at the Bufalo project, located 120 kilometers east of the city of Antofagasta. The Bufalo project corresponds to a district that hosts several mineralized bodies of copper, copper-gold and copper- gold-silver in which SQM has already drilled nearly 124,000 meters of drilling, using our own diamond and RC drilling machines. We also have a metal business development team that works to engage partners interested in investing in metal exploration within our mining properties. 6.3 STAKEHOLDER GROUPS The Company has identified its stakeholders based on four factors that affect the relationship with them: needs, impacts, interests and expectations. This process is validated by the Board of Directors, which considers the expectations of the stakeholders through permanent supervision of the commitments established with them, within the framework of the Corporate Governance Policy and the Sustainability, Ethics and Human Rights Policy. The central objective of this work is to create and strengthen long-term bonds of trust, since they are fundamental actors in the Company's work. The stakeholders that SQM has identified and the reasons for their importance are as follows: Employees: strategic allies of the Mission and the Purpose of the Company and, therefore, contribute directly to the fulfillment of the priority focuses of the business, through their talent, good performance and sense of belonging to the organization.. 6 OUR BUSINESS 92 Shareholders / Investors: make it possible to materialize SQM's business strategy with the contribution of capital and their permanent supervision of the progress of the business. They are the ones who place their trust in the Company, supporting the creation of long-term value. Collaborators and Suppliers: contribute to maintaining high standards in the processes, goods and products produced by SQM, delivering quality inputs and services, in line with the company's requirements and business sustainability criteria. Customers: SQM's raison d'être, to whom it is indebted in fulfilling its corporate purpose, providing them with innovative solutions and a broad portfolio of essential products with various industrial applications. Community: The Company aspires to a constructive and transparent relationship with all the people and groups of people that are part of its areas of influence, and of society in general, because this makes it possible to prevent risks and detect opportunities for mutual benefit in the development of the SQM’s business activity. Institutions and Organizations: correspond to different entities with which initiatives for collaboration, support and strengthening of relevant technical skills for the business and for the institutions themselves are managed. Innovation Centers, Academic Entities and Research and Development Centers: facilitate the development of key projects for the Company, through joint innovation and R&D work, studies and training that respond to current and future challenges, with the aim of permanently adding value to SQM products. Authorities: establish the regulatory frameworks required in the development of the Company's activity and, in addition, they are a fundamental interest group to explore and shape public-private initiatives that contribute to development at the local, regional and national level. Media: the bridge that makes SQM's work known to society in general: its scope and impact on the development of the country, the generation of employment, the capture of growth and innovation opportunities, and the efforts made by the Company to reconcile its economic, social and environmental performance. Within the framework of this identification of stakeholders, SQM has also detected those issues that are a priority in the daily relationship with each one of them, being aligned with the sustainable business strategy. These topics (some of which were mentioned in the Corporate Governance chapter) are the following: • Fair Labor Practices • Relationships with the community • Transformation and Labor Challenges • Global Health and Food Challenges • Human Rights and Business • Responsible Water Management • Energy management • Air Emissions • Biodiversity • Climate change • Environmental Compliance • Responsible Business Management • Product Responsibility and Innovation SQM is a member of the following associations: • Acción Empresas 6 OUR BUSINESS 93 Instituto Chileno de Administración Racional de Empresas (ICARE) Instituto de Ingenieros de Chile • Asociación de Concentración Solar de Potencia • Asociación de Industriales de Antofagasta (AIA) • Asociación de Industriales de Iquique (AII) • Asociación Gremial de Industriales Químicos de Chile (ASIQUIM) • Cámara Chilena Australiana de Comercio (AUSCHAM) • Cámara Chileno Belgo Luxemburguesa de Comercio A.G. • Cámara Chilena Norteamericana de Comercio (AMCHAM) • Cámara de Comercio de Santiago • Cámara Chileno China de Comercio, Industria y Turismo A.G. • Consejo Regional de Seguridad Minera (CORESEMIN) Antofagasta • Consejo Regional de Seguridad Minera (CORESEMIN) Tarapacá • Fundación Chile del Pacífico • Fundación Generación Empresarial – FGE • • • Pacto Global Chile • Sociedad de Fomento Fabril (SOFOFA) • Sociedad Nacional de Minería (SONAMI) • Asociación Comercial Española de Fertilizantes (ACEFER) • Asociación Española para la Valorización de Envases (AEVAE) • Asociación Internacional de Fertilizantes (IFA) • Asociación Mundial de Yodo (WIA) • Asociación Nacional de Comercializadores y Productores de Fertilizantes A.C.(ANACOFER) • Belgian Electrotechnical Committee npo (BEC) • Drug, Chemical & Associated Technologies Association, Inc. (DCAT) • European Association for Storage of Energy (EASE) • European Solar Thermal Electricity Association (ESTELA) • Far West Agribusiness Association (FWAA) • Georgia Citrus Association • • Nacional de Mastitis Council • Protermosolar • The Fertilizer Institute (TFI) Independent Lubricant Manufacturers Association (ILMA) It is worth mentioning that SQM is a member of the board of directors in five of the associations above. 6 OUR BUSINESS 94 6.4 PROPERTY, RESERVES AND FACILITIES Information concerning our mining properties in this Annual Report on Form 20 F has been prepared in accordance with the requirements of subpart 1300 of Regulation S-K, which first applied to us for the fiscal year ended December 31, 2021. These requirements differ significantly from the previously applicable SEC Industry Guide 7 disclosure requirements. Among other things, subpart 1300 of Regulation S-K requires disclosure of mineral resources, in addition to mineral reserves, as of December 31, 2022, both in the aggregate and for each of our individually material mining properties. Our mineral reserves and resources are estimated by individuals deemed Qualified Persons (QP) according to the standards set forth in subpart 1300 of Regulation S-K. SQM believes it is a production stage company based on the classification of its material properties. SQM reports mineral resource and reserve estimates for development and production stage projects, following the classification done by SQM of its material properties. See the individual property disclosures below for further details regarding the mineral rights, titles, property size, permits and other information for our significant mineral extraction properties. Mineral resources and reserves are defined in subpart 1300 of Regulation S-K as follows: Mineral resource. A concentration or occurrence of material of economic interest in or on the earth’s crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction. A mineral resource is a reasonable estimate of mineralization, taking into account relevant factors such as cut-off grade, likely mining dimensions, location or continuity, that, with the assumed and justifiable technical and economic conditions, is likely to, in whole or in part, become economically extractable. It is not merely an inventory of all mineralization drilled or sampled. Mineral reserve. An estimate of tonnage and grade or quality of indicated and measured mineral resources that, in the opinion of a QP, can be the basis of an economically viable project. More specifically, it is the economically mineable part of a measured or indicated mineral resource, which includes diluting materials and allowances for losses that may occur when the material is mined or extracted. Under subpart 1300 of Regulation S-K, mineral resources may not be classified as mineral reserves unless the determination has been made by a QP that such mineral resources can be the basis of an economically viable project. The conversion of reported mineral resources to mineral reserves should not be assumed. Mineral resource classifications are differentiated under subpart 1300 of Regulation S-K, in part, as follows: Measured resource. That part of a mineral resource with the highest level of geological confidence; quantity and grade or quality are estimated on the basis of conclusive geological evidence and sampling. The level of geological certainty associated with a measured mineral resource is sufficient to allow a QP to apply modifying factors in sufficient detail to support detailed mine planning and final evaluation of the economic viability of the deposit. Indicated resource. That part of a mineral resource with a level of geological confidence between that of measured and inferred resources; quantity and grade or quality are estimated on the basis of adequate geological evidence and sampling. The level of geological certainty associated with an indicated mineral resource is sufficient to allow a QP to apply modifying factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Inferred resource. That part of a mineral resource with the lowest level of geological confidence; quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. The level of geological uncertainty associated with an inferred mineral resource is too high to apply relevant technical 6 OUR BUSINESS 95 and economic factors likely to influence the prospects of economic extraction in a manner useful for evaluation of economic viability. Caliche Geologists and mining engineers who are QPs prepare our estimates of caliche ore resources and reserves. The resource and reserve figures presented below are estimates and may be subject to modifications due to natural factors that affect the distribution of mineral grades, which would, in turn, modify the recovery of nitrate and iodine. Therefore, no assurance can be given that the indicated levels of recovery of nitrates and iodine will be realized. We estimate ore resources and reserves based on evaluations, performed by engineers and geologists, of assay values derived from sampling of drillholes and other openings. Drillholes have been made at different space intervals in order to recognize mining resources. Normally, we start with 400x400 meters and then we reduce spacing to 200x200 meters, 100x100 meters and 50x50 meters. The geological occurrence of caliche ore is unique and different from other metallic and non-metallic minerals. Caliche ore is found in large horizontal layers at depths ranging from one to four meters and has an overburden between zero and two meters. This horizontal layering is a natural geological condition and allows us to estimate the continuity of the caliche bed based on surface geological reconnaissance and analysis of samples and trenches. Salar de Atacama Hydrogeologists and geologists who are QPs prepare our estimates of the resource and reserve base of potassium, sulfate, lithium and boron dissolved in brines at the Salar de Atacama. We have exploitation concessions through Corfo covering an area of 81,920 hectares, in which we have carried out geological exploitation, brine sampling and geostatistical analysis. Mt. Holland Geologists and mining engineers who are QPs prepared the mineral resource and reserve estimation for lithium hydroxide contained in pegmatites at Mt. Holland. The mineral reserve has been calculated from the mine plan created from the mineral resource estimation. Wireframes for the geological domains are defined by mineralization style and based on a cut-off grade of 0.5% lithium oxide. Derechos Mineros The discussion of our mining rights is organized below according to the geographic location of our mining operations. Our caliche ore mining interests are located throughout the valley of the Tarapacá and Antofagasta regions of northern Chile (in a part of the country known as “El Norte Grande”). From caliche ore, we produce products based on nitrates and iodine, and caliche also contains concentrations of potassium. Our mining interests in the brine deposits of the Salar de Atacama are found within the Atacama Desert, in the eastern region of El Norte Grande. From these brines we primarily produce products based on potassium, sulfate, and lithium. Our spodumene mining interests are located in Mt. Holland in Western Australia. From spodumene, we produce lithium hydroxide. The map below shows the location of our principal mining operations in Chile and the exploitation and exploration mining concessions that have been granted to us, as well as the mining properties that we lease from Corfo: 6 OUR BUSINESS 96 Figure 1. Location of SQM mining operations in Chile and the exploitation and exploration mining concessions. 6 OUR BUSINESS 97 The map below shows the location of our principal mining operations in Australia and the exploitation and the Mt. Holland Joint Venture. exploration mining concessions that have been granted to Figure 2. Location of Mt. Holland JV mining operations in Australia and the exploitation and exploration mining concessions. 6 OUR BUSINESS 98 Mining Concessions in Chile We hold our mining rights in Chile pursuant to mining concessions for exploration and exploitation of mining resources granted pursuant to applicable law in Chile. For a discussion of the mining concessions, see “Material Individual Properties — El Norte Grande — Mining Concessions for the Exploration and Exploitation of Caliche Ore” and “—Salar de Atacama Mining Concessions for Exploitation of Brines.” As of December 31, 2022, approximately 56% of SQM’s mining interests in Chile were held pursuant to Mining Exploitation Concessions and 0.44% pursuant to Mining Exploration Concessions. Of the Mining Exploitation Concessions, approximately 98% already have been granted pursuant to applicable Chilean law, and approximately 2% are in the process of being granted. Of the Mining Exploration Concessions, approximately 100% already have been granted pursuant to applicable Chilean law. In 2022, we made payments of US$7.3 million to the Chilean government for Mining Exploration and Exploitation Concessions, including the concessions we lease from Corfo. These payments do not include the payments we made directly to Corfo pursuant to the Corfo Agreements, according to the percentages of the sales price of products produced using brines from the Salar de Atacama. The following table shows the Mining Exploitation and Exploration Concessions held by SQM, including the mining properties we lease from Corfo, as of December 31, 2022: Exploitation Concessions Exploration Concessions Total Region of Chile Total Number Hectares Total Number Hectares Total Number Hectares Region I Region II 2,743 514,519 8,921 2,345,120 Region III and others 456 104,921 Total 12,120 2,964,560 2 17 3 22 1,000 2,745 515,519 10,900 8,938 2,356,020 500 459 105,421 12,400 12,142 2,976,960 The majority of the Mining Exploitation Concessions held by SQM were requested primarily for non- metallic mining purposes. However, a small percentage of our Mining Exploration Concessions were requested for metallic mining purposes. The annual payment to the Chilean government for this group of concessions is higher. Geological studies over mining properties that were requested primarily for non-metallic mining purposes may show that the concession area is of interest for metallic mining purposes, in which case we must inform the Chilean National Geology and Mining Survey (Sernageomin), indicating that the type of substance contained by such Mining Concessions has changed, for purposes of the annual payment for these rights. 6 OUR BUSINESS 99 Mt. Holland Mining Rights The Mt. Holland Lithium project development envelope for the Mine and Concentrator is spread across three core mining tenements (M77/1065, M77/1066 & M77/1080), as well as exploration licenses, general purpose licenses and miscellaneous licenses (Project Tenements), covering an approximate area of 4,606 hectares. A summary map showing the main tenements is provided in Figure 2. The majority of the project properties are currently registered in equal parts to MH Gold, an affiliate of Wesfarmers Limited, and SQM Australia, an affiliate of SQM. Other exploration rights in the Mt. Holland project are registered to MH Gold Pty Ltd or Montague Resources Australia Pty Ltd, both ultimately controlled by Wesfarmers Chemicals, Energy and Fertilizers (WesCEF). The project is a joint venture, in which SQM owns 50% and Wesfarmers Limited owns the remaining 50% (the “Mt. Holland JV”), and is managed by Covalent Lithium Pty Ltd (“Covalent”), an entity owned 50% by SQM and 50% by Wesfarmers. Covalent is not the registered holder or applicant of the project properties under the Mining Act of 1978 (WA) (Mining Act). Covalent and the joint venturers have entered into an access agreement with Montague and MH Gold that authorizes the Mt. Holland Joint venture to access those properties as required for the purpose of the project. Costs Caliche ore is the key raw material used in the production of iodine, specialty plant nutrients and industrial chemicals. The following gross margins for the specified business lines were calculated on the same basis as cut-off grades used to estimate our reserves. We expect costs to remain relatively stable in the near future. 2022 2021 2020 Gross margin Price Gross margin Price Gross margin Price Iodine and Derivatives 63% US$59/kg 45% US$36/kg 50% US$35/kg Specialty Plant Nutrition Industrial Chemicals 38% US$1,383/ton 29% US$787/ton 23% US$677/ton 32% US$1,124/ton 17% US$757/ton 26% US$713/ton Brines from the Salar de Atacama are the key raw material used in the production of potassium chloride and potassium sulfate, and lithium and its derivatives. The following gross margins for the specified business lines were calculated on the same basis as cut-off grades used to estimate our reserves. We expect costs to remain relatively stable in the near future 2022 2021 2020 Gross margin Price Gross margin Price Gross margin Price Potassium Chloride Potassium Sulfate and 56% US$910/ton 39% US$466/ton 11% US$288/ton Lithium and Derivatives 55% US$52,000/ton 47% US$9,300/ton 23% US$5,931/ton 6 OUR BUSINESS 100 Summary of Mineral Reserves and Resources The following tables summarize our estimated mineral reserves and resources as of December 31, 2022. The quantity of the mineral resources is estimated on an in situ basis as attributable to us. Mineral resources are reported exclusive of mineral reserves. The quantity of the mineral reserves is estimated on a saleable product basis as attributable to us. The relevant technical information supporting mineral reserves and resources for each material property is included in the “Material Individual Properties” section below, as well as in the technical report summaries (“TRS”) filed as to this Annual Report on Form 20 F. 6 OUR BUSINESS 101 Summary Mineral Reserves at End of the Fiscal Year Ended December 31, 2022 (1): Proven Mineral Reserves Probable Mineral Reserves Total Mineral Reserves Salar de Atacama, Chile Volume (Vol Mm3) Grade (% Li by weight) Volume (Vol Mm3) Grade (% Li by weight) Volume (Vol Mm3) Grade (% Li by weight)) Lithium—Brines: (2), (3), (4), (5) 143 0.20 107 0.20 250 0.20 Mt. Holland, Australia Volume (MT) Grade (Li2O%) Volume (MT) Grade (Li2O%) Volume (MT) Grade (Li2O%) Lithium—Pegmatite: (6) 10.8 1.48 31.2 1.6 42.0 1.57 Salar de Atacama, Chile Volume (Vol Mm3) Grade (% K by weight) Volume (Vol Mm3) Grade (% K by weight) Volume (Vol Mm3) Grade (% K by weight) Potassium: (2), (3), (4), (5) 143 2.33 107 2.16 250 2.26 El Norte Grande Caliche, Chile Nitrate: (7), (8), (9) Volume (MT) Grade (%NO3 by weight) Volume (MT) Grade (%NO3 by weight) Volume (MT) Grade (%NO3 by weight) Pedro de Valdivia Maria Elena Pampa Blanca 99 94 35 Nueva Victoria 220 Pampa Orcoma 0 Total 448 9.1 8.1 6.3 5.9 --- 7.1 112 10 498 553 309 1,482 5.8 6.9 4.7 5.1 6.9 5.4 211 104 533 773 309 1,930 7.3 8.0 4.8 5.3 6.9 5.8 El Norte Grande Caliche, Chile Iodine: (7), (8), (9) Volume (MT) Grade (I2 parts by million) Volume (MT) Grade (I2 parts by million) Volume (MT) Grade (I2 parts by million) Pedro del Valdivia Maria Elena 99 94 522 491 112 10 366 374 211 104 439 480 6 OUR BUSINESS 102 Pampa Blanca 35 Nueva Victoria 220 Pampa Orcoma 0 Total 448 ________________ 552 441 --- 478 498 553 309 1,482 480 415 413 432 533 773 309 1,930 485 422 413 443 (1) Comparisons of values may not add due to rounding of numbers and the differences caused by averaging (2) Salar de Atacama, Chile. The process efficiency is based on the type of extracted brine at each well over the course of the simulation, the average process efficiency over the entire life of mine (LoM) is approximately 52% for lithium and approximately 74% for potassium. (3) Salar de Atacama, Chile. The average lithium and potassium concentration is weighted by the simulated extraction rates in each well. (4) (4) Salar de Atacama, Chile. The mineral resource and reserve estimate considers a 0.05% w/w cut-off grade for lithium based on the cost of generating lithium product, lithium carbonate sales, and the respective cost margin. Based on historical lithium prices from 2010 and the forecast to 2040, a projected lithium carbonate price of US$15,000 per metric ton with the corresponding cost and profit margin is considered with a small increase to accommodate the evaporation area and use of additives. A similar analysis was undertaken for potassium where the cut-off grade of 1% w/w has been set by SQM based on respective costs, sales, and margin. (5) Salar de Atacama, Chile. This reserve estimate differs from the in-situ base reserve previously reported (SQM, 2020) and considers the modifying factors of converting mineral resources to mineral reserves, including the production wellfield design and efficiency, as well as environmental and process recovery factors. The reserve estimate also considers the expiry of the Lease Agreement in 2030 (end of LoM). The Qualified Persons for the Mineral Reserves are Rodrigo Riquelme and Gino Slanzi. (6) Mt. Holland, Australia. Mineral reserve tonnage and grade have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding. Metallurgical processes are designed for nominal 2Mpta ore feed. Process recovery to concentrate is estimated at 75% for lithium oxide for predominantly spodumene mineralization and 0% for other mineralization types. Refinery process recovery is estimated at 85%. Tantalum recovery is estimated at 0%. A total operating cost of US$4,979 per metric ton for Lithium hydroxide production was considered in the reserve evaluation. The price, cost, and mass yield parameters, along with the internal constraints of the current operations, result in a mineral reserves cut-off grade of 0.5% lithium oxide based on a selling lithium hydroxide price of US$11,000 per ton FOB. The Qualified Person for the Mineral Reserves is David Billington with an effective date: December 15, 2021. No material changes have been reported since that date. (7) El Norte Grande Caliche, Chile. The cutoff grades of the proven and probable Reserves vary according to the required targets at the different mines. The values assigned correspond to the averages of the different sectors. The cut-off grade is for nitrate content, while also considering the iodine content. (8) El Norte Grande Caliche, Chile. The average overall metallurgical recovery of the nitrate and iodine processes contained in the recovered material varies between 50% and 70%. (9) The mineral resource and reserve estimate considers a cut-off grade of 300 ppm for iodine (I2) based on the production costs of iodine and derivate products. Based on historical iodine prices from 2010 and the forecast to 2040, a projected Iodine price of US$47,500 per metric ton is determined, taking in account the corresponding operational, financial and planned investment costs, depreciation, profit margin and taxes. A similar analysis was undertaken for nitrates where the cut-off grade of 3.0% sodium nitrate has been set by SQM based on respective costs for potassium-sodium nitrates (fertilizers) production. A projected price of US$820 per metric ton for potassium-sodium nitrates is considered by SQM in the economic analysis executed from 2010 and the forecast to 2040. In addition, a projected solar salts price of US$680 per metric ton has been considered by SQM. Modifying factors of historical operational use in various of SQM’s mining facilities, are applied to iodine and nitrate grades reported as probable resource estimates. The factors applied to iodine and nitrate grades are 0.9 and 0.85 respectively. (10) Reserve estimates are shown for the area with environmental permits in force or currently pending for mining operations. The Qualified Person for Nueva Victoria, Pampa Orcoma, Pedro de Valdivia and Pampa Blanca mining reserves are Marco Lema and Marta Aguilera. Summary Mineral Resources Exclusive of Reserves at End of the Fiscal Year Ended December 31, 2022 (1), (2): 6 OUR BUSINESS 103 Measured Mineral Resources Indicated Mineral Resources Measured & Indicated Mineral Resources Inferred Mineral Resources Salar de Atacama, Chile Volume (Vol Mm3) Grade (% Li by weight) Volume (Vol Mm3) Grade (% Li by weight) Volume (Vol Mm3) Concentration (% Li by weight) Volume (Vol Mm3) Grade (% Li by weight) Lithium— Brines: (4) (3), Lithium— Pegamite: (5) Potassium: (3), (4) 2.254 0.20 1.435 0.160 3.689 0.180 1.614 0.133 Mt. Holland, Australia Volume (MT) Grade (Li2O%) Volume (MT) Grade (Li2O%) Volume (MT) Grade (Li2O%) Volume (MT) Grade (Li2O%) 13.5 1.58 30.5 1.45 44.0 1.49 3.5 1.38 Salar de Atacama, Chile Volume (Vol Mm3) Grade (% K by weight) Volume (Vol Mm3) Grade (% K by weight) Volume (Vol Mm3) Grade (% K by weight) Volume (Vol Mm3) Grade (% K by weight) 2.254 1.80 1.435 1.70 3.689 1.77 1.614 1.77 El Norte Grande Caliche, Chile Nitrate: (6), (7) Volume (MT) Grade (% NO3 by weight) Volume (MT) Grade (% NO3 by weight) Volume (MT) Grade (% NO3 by weight) Volume (MT) Pedro de Valdivia --- --- 138 Maria Elena 21 11.1 119 Pampa Blanca Nueva Victoria Pampa Orcoma Total 17 --- --- 38 5.3 --- --- 48 20 18 8.5 343 7.6 10 8.9 4.7 7.4 8.4 138 140 65 20 18 381 7.6 10.2 8.0 4.7 7.4 8.5 El Norte Grande Caliche, Chile 52 117 223 31 --- 423 Grade (% NO3 by weight) 6.1 7.2 5.4 6.5 --- 6.1 6 OUR BUSINESS 104 Iodine: (6), (7) Volume (MT) Grade (I2 parts per million) Volume (MT) Grade (I2 parts per million) Volume (MT) Grade (I2 parts per million) Volume (MT) Grade (I2 parts per million) Pedro de Valdivia --- --- 138 564 138 Maria Elena 21 489 119 465 140 Pampa Blanca Nueva Victoria Pampa Orcoma Total 17 --- --- 38 ________________ 563 --- --- 48 20 18 383 415 457 65 20 18 522 343 490 381 564 469 430 415 457 493 52 117 223 31 --- 423 409 362 511 343 --- 445 (1) Comparison of values may not add due to the rounding of numbers and differences caused by averaging. (2) Mineral resources are not mineral reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the mineral resource will be converted into mineral reserves upon the application of modifying factors. (3) Salar de Atacama, Chile. Mineral resources are reported as in-situ and exclusive of mineral reserves, where the estimated mineral reserve without processing losses during the reported LoM and real declared extraction from 2022 were subtracted from the mineral resource inclusive of mineral reserves. A direct correlation between proven reserves and measured resources, as well as probable reserves and indicated resources was assumed.The Qualified Person for the Mineral Resources is Andrés Fock. (4) Salar de Atacama, Chile. The mineral resource and reserve estimate consider a 0.05% w/w cut-off grade for lithium based on the cost of generating lithium product, lithium carbonate sales, and the respective cost margin. Based on historical lithium prices from 2010 and the forecast to 2040, a projected lithium carbonate price of US$15,000 per metric ton with the corresponding cost and profit margin is considered with a small increase to accommodate the evaporation area and use of additives. A similar analysis was undertaken for potassium where the cut-off grade of 1% w/w has been set by SQM based on respective costs, sales, and margin. (5) Mt. Holland, Australia. Mineral resource tonnage and measured content have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding. Mineral resources are reported as exclusive of mineral reserves. Resource disclosed corresponds to the resources attributable to SQM. Mineral resources are not mineral reserves and do not have demonstrated economic viability. Resources have been reported as in situ (hard rock within optimized pit shell). Pit optimization and economics for derivation of cut off grade include mine gate pricing of US$800 FOB per ton of 6% Li2O concentrate, AUS$19 per bcm mining cost (LoM average cost-variable by depth), AU$65 processing cost per ton. Mining dilution set at 5% and recovery at 95%. Royalty fees 5%. The optimization considered for the concentrator is 75%. Costs estimated in Australian Dollars were converted to US Dollars based on an exchange rate of AU$0.75:US$1.00. These economics define a cut-off grade of 0.50% Li2O. Kerry Griffin is the QP responsible for the mineral resource estimate with an effective date: October 6, 2021. No material changes have been reported since that date. (6) El Norte Grande, Caliche, Chile. To calculate measured resources, SQM uses the RGM100T and RGM50 data results combined in a 3D block model built using Kriging and applying some criteria: caliche thickness ≥ 2.0 m; overload thickness ≤1.0 m; waste / Mineral Ratio ≤ 1.0; and cut-off grades of NaNO3 (3%) and Iodine (300 ppm). To calculate indicated resources, SQM uses the RGM100 and RGM200 data results combined using the inverse distance weighting (IDW). To evaluate Probable Reserves a reduction on grades mut be consider as consequence of the deposit geological variability which determines a contrasting decrease in grades by going from 200x200m research grids to lower 100T (~100x50m) or 50x50m grids. The mineral resource estimates were prepared by Marta Aguilera (who is the independent Qualified Person for these mineral resource estimates), reported using the S-K 1300 Definition Standards adopted December 2018. The Qualified Persons for the Pedro de Valdivia, María Elena and Pampa Blanca Mineral Resources are Marco Lema and Marta Aguilera. 6 OUR BUSINESS 105 (7) El Norte Grande, Caliche, Chile. The estimate was completed using a SG of 2.1 ton/m³. Cut-off grade for iodine is 300 ppm. The cutoff grades of the mineral resources vary according to the required targets at the different mines. The values assigned correspond to the averages of the different sectors. In our mining sites, the cut-off grade is for nitrate content considers iodine. The mineral reserve estimate considers a cut-off grade of 300ppm for iodine (I2) based on the production costs of Iodine and derivate products. Based on historical iodine prices from 2010 and the forecast to 2040, a projected iodine price of US$47,500 is determined, taking in account the corresponding operational, financial and planned investment costs, depreciation, profit margin and taxes. A similar analysis was undertaken for nitrates where the cut-off grade of 3.0% NaNO3 has been set by SQM based on respective costs for potassium-sodium nitrates (fertilizers) production. A projected price of US$820 per ton for potassium-sodium nitrates is considered by SQM in the economic analysis executed from 2010 and the forecast to 2040. In addition, a projected solar salts price of US$680 per ton has been considered by SQM. Material Individual Properties To determine our individually material mining operations in accordance with subpart 1300 of Regulation S-K, management considered both quantitative and qualitative factors, assessed in the context of our overall business and financial condition. Such assessment included our aggregate mining operations on all of our mining properties, regardless of the stage of production or the type of mineral produced. Quantitative factors included, among others, mining operations’ relative contributions to our aggregate historical and estimated revenues, cash flows, and EBITDA. Qualitative factors may include, as applicable, capital expansion plans, long-term pricing outlook, the regulatory environment and various strategic priorities. We concluded that, as of December 31, 2022, our individually material mines are the caliche ore mines at Nueva Victoria and Pampa Orcoma in El Norte Grande region of Chile, the brines in the Salar de Atacama in Chile and the Mt. Holland lithium project in Western Australia. We will update our assessment of individually material mines on an annual basis. The information that follows relating to such individually material properties is derived, for the most part, from, and in some instances is an extract from, from the TRS relating to such properties prepared in compliance with Item 601(b)(96) and subpart 1300 of Regulation S-K. Portions of the following information are based on assumptions, qualifications and procedures that are not fully described herein. Reference should be made to the full text of the TRS, incorporated herein by reference and made a part of this Annual Report on Form 20 F. The relevant TRS for the Salar de Atacama property, the Nueva Victoria property, the Pampa Orcoma property, and the Mt. Holland lithium project properties are included as Exhibits 96.1, 96.2, 96.3 and 96.4, respectively, to this Annual Report on Form 20 F. Properties and Facilities el Norte Grande Caliche, Chile Our mining operations are concentrated in the First Region of Chile, where we mainly work in the mining areas of Tente en el Aire,Nueva Victoria Norte/West and Torcaza. The El Norte Grande Caliche, found in Regions I and II of northern Chile, corresponds to flat areas or “pampas”, that have been thoroughly explored. Results indicate that these prospects hold mineralization of nitrate and iodine. The area is accessible from Santiago through Route 5. The mineralization is stratiform in style, with a wide areal distribution, forming "spots" of several kilometers in extension, where mineralization thicknesses are variable. As a result of geological activity over time (volcanism, weathering, faulting) the deposits can be found as continuous mantles. Environmental permits for mining operations, and the corresponding Environmental Qualification Resolution, grant access to the required water and electricity supply, as well as the infrastructure required for the mining operation.. 6 OUR BUSINESS 106 Facilities Nueva Victoria The Nueva Victoria mine and facilities are located 140 kilometers southeast of Iquique and are accessible by highway. Since 2007, the Nueva Victoria mine includes the mining properties Soronal, Mapocho and Iris. At this site, we use caliche ore to produce salts rich in nitrates and iodine, through heap leaching and the use of solar evaporation ponds. The main production facilities at this site include the operation centers for the heap leaching process, the iodide and iodine plants at Nueva Victoria and Iris and the evaporation ponds at the Sur Viejo sector of the site. The areas currently being mined are located approximately 25 kilometers northeast of Nueva Victoria. Solar energy and electricity are the primary sources of power for this operation. The nitrate-rich salts are sent to Coya Sur, which is a process plant located approximately 15 kilometers south of María Elena, and production activities undertaken there are associated with the production of potassium nitrate and finished products. The main production plants at this site include four potassium nitrate plants with a total capacity of 1,300,000 metric tons per year. There are also four production lines for crystallized nitrates, with a total capacity of 1,200,000 metric tons per year, and a prilling plant with a capacity of 360,000 metric tons per year. The potassium nitrate produced at Coya Sur is an intermediate product that is used as a raw material for the production of finished products (crystallized nitrates and prilled nitrates). Therefore, the production capacities listed above are not independent of one another and cannot be added together to obtain an overall total capacity. Natural gas is the main source of energy for our Coya Sur operation. Pampa Orcoma The Pampa Orcoma Project is located in the Tarapacá Region of northern Chile. It is situated 99 kilometers to the northeast of the city of Iquique, in the community of Huara. The property covers an area of 10,296 hectares and is composed of 45 mining concessions. The Pampa Orcoma Project aims to produce iodide, iodine and nitrate-rich salts from the processing of caliche that will be extracted from deposits rich in this mineral. The Pampa Orcoma Mining Plan considers an initial extraction of caliche at a rate of 8.4 Mt/year between 2024 2027, followed by an extraction rate of 20 Mt/year from 2028 onwards. For the period 2024 2040 a total extraction of 287.4 Mt of caliche is projected with an average grade of 408 ppm iodine and 6.7% nitrates. The production process to obtain iodine as the main product, along with salts rich in sodium nitrate and potassium nitrate as by-products, involves leaching with seawater or with recirculated solutions to obtain a solution rich in iodate, which will then be treated in chemical plants to transform it into elemental iodine in prill format. The Pampa Orcoma Project contemplates the construction of the following facilities: iodide and iodine production plants, with a capacity of 2,500 t/year (of equivalent iodine), evaporation ponds to produce salts rich in nitrate at a rate of 320,325 t/year and a seawater adduction pipe to meet the water needs. Solar energy and electricity are the primary sources of power for this future operation. The following table provides a summary of our El Norte Grande production facilities as of December 31, 2022: Facility Type of Facility Approximate Size (hectares) (1) Nominal Production Capacity (thousand of metric tons/year) Weighted Average Age (years) (2) Gross Book Value (millions of US$) (2) 6 OUR BUSINESS 107 Coya Sur (3), (4) Nitrates production 1,518 Potassium nitrate: 1.300 Crystallized nitrates: 1.200 Prilled nitrates: 360 10.25 756.4 Nueva Victoria (5), (7) Pampa Orcoma Concentrated nitrate salts and iodine production Concentrated nitrate salts and iodine production ________________ 47,492 Iodine: 13.0 6.92 625.8 7,387 2.5 - - (1) Approximate size considers both the production facilities and the mine for Nueva Victoria Mining areas are those authorized for exploitation by the environmental authority and/or Sernageomin. (2) Weighted average age and gross book value correspond to production facilities, excluding the mine, for Nueva Victoria. (3) Includes production facilities and solar evaporation ponds. (4) The potassium nitrate produced at Coya Sur is an intermediate product that is used as a raw material for the production of finished products (crystallized nitrates and prilled nitrates). Therefore, the production capacities listed above are not independent of one another and cannot be added together to obtain an overall total capacity. (5) Includes production facilities, solar evaporation ponds and leaching heaps. (6) The nominal production capacity for iodine considers the capacity of our plants. The effective capacity is 14,800 metric tons per year. We directly or indirectly through subsidiaries own, lease or hold concessions over the facilities at which we carry out our operations. Such facilities are free of any material liens, pledges or encumbrances, and we believe they are suitable and adequate for the business we conduct in them. 6 OUR BUSINESS 108 Extraction Yields The following table shows certain operating data relating to each of our El Norte Grande mines for 2022, 2021 and 2020: (in thousands, unless otherwise stated) 2022 2021 2020 Coya Sur (1) Metric tons of crystallized nitrate produced 725 820 935 Nueva Victoria Metric tons of ore mined Iodine (ppm) Metric tons of iodine produced ________________ 44.324 41.428 43.420 430 10,8 441 8,7 452 10,6 (1) Includes production at Coya Sur from treatment of nitrates solutions from María Elena and Pedro de Valdivia, nitrate salts from pile treatment at Nueva Victoria, and net production from NPT, or technical grade potassium nitrates. Reserves and Resources According to our experience in caliche ore, the grid pattern drillholes with spacings between 50 and100 meters produce data on the caliche resources that is sufficiently defined to consider them measured resources and then, adjusting for technical, economic and legal aspects, as proven reserves. These reserves are obtained using the Kriging Method and the application of operating parameters to obtain economically profitable reserves. Similarly, the information obtained from detailed geologic work and samples taken from grid pattern drillholes with spacings between 100 and 200 meters can be used to determine indicated resources. By adjusting such indicated resources to account for technical, economic and legal factors, it is possible to calculate probable reserves. Probable reserves are calculated by using a Inverse Distance Weighting (IDW), and have an uncertainty or margin of error greater than that of proven reserves. However, the degree of certainty of probable reserves is high enough to assume continuity between points of observation. The conversion of resources into reserves requires consideration of modifying factors, the most relevant of which is the existence of a valid environmental license (RCA or Sectorial Authorization). The criteria for converting resources into reserves, based on the environmental license modifying factor criterion, adopted for caliche mines are as follows: 1. Unit tonnage conversion criteria in both measured resources and indicated resources. 2. Grade conversion criteria: unit factor in measured resources and lower than unit and variable according to the mine, in the Iodine and Nitrate grades, for the indicated resources, due to the variability of the deposit. 6 OUR BUSINESS 109 Application of the factor associated with related environmental permit, not qualifying as reserves 3. the resources defined in sectors without an environmental permit and qualifying as proven/probable reserves the measured/indicated resources associated with sectors with an effective environmental permit or Sectorial Authorization in force. Nueva Victoria—Summary of Mineral Reserves at the End of the Fiscal Year Ended December 31, 20221,2,3,4,5,6,7,8,9 Amount Nitrate grade (MT) (% by weight) Iodine grade (Parts per million(ppm)) Cut-off grade1 Metallurgical Recovery2 Proven mineral reserves 220 Probable mineral reserves 553 Total mineral reserves 773 5.9 5.1 5.3 441 415 422 ______________ Nitrate 3.0%, Iodine 300 ppm 50%-70% 1. Mineral Reserves are based on Measured and Indicated Mineral Resources at an operating cutoff of 3% for nitrates and 300 ppm iodine. Operating constraints of caliche thickness ≥ 2.0 m; overburden thickness ≤1.0 m; and waste / caliche ratio ≤01.0 are applied. 2. Proven Mineral Reserves are based on Measured Mineral Resources at the criteria described in (1) above. The average overall metallurgical recovery of the nitrate and iodine processes contained in the recovered material varies between 50% and 70%. Based on SQM’s operational experience and the laboratory and full-scale tests carried out, a progressive increase, over time, in heap leaching yield is expected, as irrigation application rates increase. 3. Probable Mineral Reserves are based on Indicated Mineral Resources at the criteria described in (1) above with a grade call factor of 0.9 for iodine and 0.85 for nitrates confirmed by operating experience. 4. Mineral Reserves are stated as in-situ ore (caliche) as the point of reference. 5. The units “Mt”, “kt”, “ppm” and % refer to million tonnes, kilotonnes, parts per million, and weight percent, respectively. 6. Mineral Reserves are based on an iodine price of US$47.5 per kilogram and a nitrate price of US$295 per ton. Mineral Reserves are also based on economic viability as demonstrated in an after-tax discounted cashflow. 7. Marta Aguilera is the QP responsible for the Mineral Reserves. 8. The QP is not aware of any environmental, permitting, legal, title, taxation, socioeconomic, marketing, political or other relevant factors that could materially affect the Mineral Reserve estimate that are not discussed in this TRS. 9. Comparisons of values may not total due to rounding of numbers and the differences caused by use of averaging methods. Nueva Victoria—Summary of Mineral Resources Exclusive of Mineral Reserves at the End of the Fiscal Year Ended December 31, 20221,2,3,4,5,6 Resources Nitrate grade Iodine grade Amount (Mt) (% by weight) --- 20 --- 4.7 (Parts per million(ppm)) Cut-off Grade5 --- 415 Nitrate 3.0%, Iodine 300 ppm Measured mineral resources Indicated mineral resources 6 OUR BUSINESS 110 Measured + Indicated mineral resources Inferred mineral resources ________________ 20 31 4.7 6.5 415 343 1. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the Mineral Resource will be converted into Mineral Reserves upon the application of modifying factors. 2. Mineral Resources are reported as in-situ and exclusive of Mineral Reserves, where the estimated Mineral Reserve without processing losses during the reported LoM was subtracted from the Mineral Resource inclusive of Mineral Reserves. All Measured and Indicated Mineral Resources have been converted into Mineral Reserves; as a result, only Inferred Mineral Resources are reported in this TRS. 3. Comparisons of values may not add due to rounding of numbers and the differences caused by use of averaging methods 4. The units “Mt”, “ppm” and % refer to million tonnes, parts per million, and weight percent respectively. 5. The Mineral Resource estimate considers a cut-off grade of 3% for nitrates and 300 ppm for iodine, based on accumulated cut-off iodine grades and operational average grades, as well as caliche thickness ≥ 2.0 m and overburden thickness ≤ 1.0 m. The iodine cut-off grade considers the cost and medium- and long-term price forecasts of generating iodine as discussed in Sections 11, 16 and 19 of the TRS. 6. Marta Aguilera is the QP responsible for the Mineral Resources. Pampa Orcoma—Summary of Mineral Reserves at the End of the Fiscal Year Ended December 31, 202211,2,3,4,5,6,7,8 Amount Nitrate grade (MT) (% by weight) Iodine grade (Parts per million(ppm)) Cut-off grade1 Metallurgical Recovery2 Proven mineral reserves -- -- Probable mineral reserves 309 Total mineral reserves 309 6.9 6.9 _____________ --- 413 413 Nitrate 3.0%, Iodine 300 ppm 50%-70% 1. Comparisons of values may not add due to rounding of numbers and the differences caused by use of averaging methods. 2. The units “Mt” and “ppm” refer to million tonnes and parts per million, respectively. The average overall metallurgical recovery of the nitrate and iodine processes contained in the recovered material varies between 50% and 70%. Based on SQM’s operational experience and the laboratory and full-scale tests carried out, a progressive increase, over time, in heap leaching yield is expected, as irrigation application rates increase. 3. The Mineral Reserve estimate considers a cut-off grade of 300 ppm for iodine and 3.0% for nitrates, based on accumulated cut-off iodine grades and operational average grades, as well as the cost and medium- and long-term prices forecast of generating iodine. 4. Modifying factors of historical operational use in various of SQM’s mining facilities, are applied to iodine and nitrate grades, the factors applied to iodine and nitrate grades are 0.9 and 0.85, respectively. 5. Mineral Resources in the area without an environmental permit are estimated at 18 Mt. 6. Mineral Reserves are reported as in-situ ore. 7. Marta Aguilera is the QP responsible for the Mineral Reserves. 8. The QP is not aware of any environmental, permitting, legal, title, taxation, socioeconomic, marketing, political or other relevant factors that could materially affect the Mineral Reserve estimate that are not discussed in this TRS. 6 OUR BUSINESS 111 Pampa Orcoma—Summary of Mineral Resources Exclusive of Mineral Reserves at the End of The Fiscal Year Ended December 31, 20221,2,3,4,5,6 Resources Nitrate grade Iodine grade Amount (Mt) (% by weight) (Parts per million(ppm)) --- 18 18 --- --- 7.4 7.4 --- --- 457 457 --- Cut-off grade1,2 Nitrate 3.0%, Iodine 300 ppm Measured mineral resources Indicated mineral resources Measured + Indicated mineral resources Inferred mineral resources ________________ 1. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the Mineral Resource will be converted into Mineral Reserves upon the application of modifying factors. 2. Mineral Resources are reported as in-situ and exclusive of Mineral Reserves, where the estimated Mineral Reserve without processing losses during the reported LOM was subtracted from the Mineral Resource inclusive of Mineral Reserves. 3. Comparisons of values may not add due to rounding of numbers and the differences caused by use of averaging methods. 4. The units “Mt” and “ppm” refers to million tonnes and parts per million, respectively. 5. The Mineral Resource estimate considers a cut-off grade of 300 ppm for iodine and 3.0% for nitrates, based on accumulated cut-off iodine grades and operational average grades, as well as the cost and medium- and long-term prices forecast for prilled iodine production. 6. Marta Aguilera is the QP responsible for the Mineral Resources. The proven and probable reserves shown above are the result of the evaluation of approximately 19.0% of the total caliche-related mining property of our Company. However, we have explored more intensely the areas in which we believe there is a higher potential of finding high-grade caliche ore minerals. The remaining 81.4% of this area has not been explored or has had limited reconnaissance, which is not sufficient to determine the potential and hypothetical resources. In 2022, we did not carry out basic reconnaissance of new mining properties. With respect to detailed explorations, in 2022, a campaign was carried out to recategorize indicated resources equivalent to 5,250 hectares in the TEA Sur, Franja Oeste, Hermosa, and Sector IV sectors of Pampa Blanca. An advanced exploration program is already designed for 2023, aimed at covering an area of 11,170 hectares in Tente en el Aire, Pampa Orcoma, Franja Oeste and Sector V of Pampa Blanca. The reserves shown in these tables are calculated based on properties that are not involved in any legal disputes between SQM and other parties. We maintain an ongoing program of exploration and resource evaluation on the land surrounding our production mines, and other sites for which we have the appropriate concessions. The information presented in the table with respect to the Nueva Victoria, Coya Sur and Pampa Orcoma mines has been validated by Qualified Persons: Ms. Marta Aguilera is a Geologist with more than 38 years of experience in the mining industry, including technical and general management, short- and long-term operational planning, cost estimation and analysis, resource estimation, geostatistics, surveys of feasibility and reserve audits. Project experience includes involvement with industrial minerals in design, analysis, planning and operational 6 OUR BUSINESS 112 control. Ms. Aguilera is a Qualified Person as defined in subpart 1300 of Regulation S-K and is registered under No. 441 in the Public Registry of Qualified Persons in Mining Resources and Reserves, in accordance with Law No. 20,235 that regulates the role of Qualified Persons and creates the Qualifying Commission of Competences in Mining Resources and Reserves ("Law for Qualified Persons") and its current regulation in Chile. Mr. Lema is a Civil Mining Engineer with more than 30 years of experience in the field. Currently, he works for SQM as Superintendent of Mining Resources and Planning. He has worked as a Mining Engineer in Metallic and Non-Metallic deposits, with vast experience in the latter. Mr. Lema is a Qualified Person, as defined in subpart 1300 of Regulation S-K and is registered under No. 375 in the Qualified Persons in Mining Resources and Reserves in accordance with the Law for Qualified Persons and its current regulation in Chile. Mr. Gino Slanzi is a Civil Engineer. He is currently the General Manager for Inprotec SPA and Senior Consultant for Pares & Alvarez. He has worked for more than 35 years in the development of metallurgical mining projects, the optimization of production plants and on management models. He visited the site in 2022. Mr. Slanzi is a Qualified Personas defined in subpart 1300 of Regulation S-K and is registered under No.441 in the Public Registry of Qualified Persons in Mining Resources and Reserves, in accordance with the Law for Qualified Persons in Chile. Concesiones mineras para la exploración y explotación del mineral Caliche We hold our mining rights for caliche ore pursuant to mining concessions for exploration and exploitation of mining resources that have been granted pursuant to applicable law in Chile: “Mining Exploitation Concessions”: entitle us to use the land in order to exploit the mineral resources contained therein on a perpetual basis, subject to annual payments to the Chilean government; and “Mining Exploration Concessions”: entitle us to use the land in order to explore for and verify the existence of mineral resources for a period of two years, at the expiration of which the concession may be extended one time only for two additional years, if the area covered by the concession is reduced by half. We may alternatively request an exploitation concession in respect of the area covered by the original exploration concession, which must be made within the timeframe established by the original exploration concession. A Mining Exploration Concession is generally obtained for purposes of evaluating the mineral resources in a defined area. If the holder of the Mining Exploration Concession determines that the area does not contain commercially exploitable mineral resources, the Mining Exploration Concession is usually allowed to lapse. An application also can be made for a Mining Exploitation Concession without first having obtained a Mining Exploration Concession for the area involved. As of December 31, 2022, the surface area covered by Mining Exploitation Concessions that have been granted in relation to the caliche resources of our mining sites is approximately 558,500 hectares. In addition, as of December 31, 2022, the surface area covered by Mining Exploration Concessions in relation to the caliche resources of our mining sites is approximately 400 hectares. We have not requested additional mining rights. 6 OUR BUSINESS 113 Properties and Facilities in the Salar de Atacama, Chile The operations of SQM in the Salar de Atacama are located in the Antofagasta Region of Chile, which covers the El Loa Province and the San Pedro de Atacama commune. The Salar de Atacama Project is currently in operation for the treatment of brines to obtain lithium and potassium salts, and as such it is in a production stage. The Salar de Atacama deposits are owned by the Corporación de Fomento de la Producción (CORFO) of Chile, which grants special operating contracts or administrative leases to private companies for the extraction of brine. SQM and Albemarle have a lease agreement with Corfo to extract and produce lithium from brines stored in the Salar de Atacama deposit. Consequently, SQM must follow the terms of the agreement and also the conditions established in numerous RCA’s in order to retain operations in the Salar de Atacama. Exploration is routinely carried out within the established areas. SQM leases an area of about 1,400 square kilometers with permission to extract brines from an area of 820 square km with two core operations. It currently produces lithium at its southwest operation. The lease was signed in 1993 and expires on December 31, 2030. The closest cities are Calama and Antofagasta, located 160 and 230 kilometers west of the site, respectively. From Calama, the road to the site is through Route R 23, and from Antofagasta, it is via Route B 385. SQM’s mineral resource in the Salar de Atacama is constituted by in-situ brine within a porous media, and the resource estimate depends on the brine concentration, aquifer geometry, and drainable interconnected pore volume. Within SQM’s concessions, the lithium and potassium resources were estimated based on extensive exploration and many depth-specific samples from each unit. The geology in the Salar de Atacama is characterized by Paleozoic to Holocene igneous and sedimentary rocks, as well as recent unconsolidated clastic deposits and evaporitic sequences. The salt flat itself resides in a tectonic basin of recent compressive-transpressive behavior and is bounded by high angle reverse and strike-slip faults. The Salar de Atacama surface is constituted by recent evaporitic deposits, where over time the process of evaporation has precipitated salts, and surficial clastic sediments are found mainly along the salt flat margins. The salt crust is mainly composed of halite, sulfates, and occasional organic matter, with alluvial facies in the peripheral zones. Evaporitic and clastic deposits within the salt flat host brine with depth and are delimitated and cut by local fault systems; several structural blocks have been identified due to recent fault displacement. The salar system of the Salar de Atacama basin is typical of a mature salar, with a nucleus constituted by a thick section of halite (>90%) with sulfate and a minor percentage of clastic sediments, as well as some interbedded clay sediments and sulfates over a surface area of 1,100 square kilometers and down to a depth of 900 meters. Within SQM’s concessions, mineralization includes lithium and potassium- rich brine in porous media of distinct zones and depths of the Salar de Atacama nucleus. Facilities Our facilities at the Salar de Atacama are located 210 kilometers to the east of the city of Antofagasta and 190 kilometers to the southeast of the city of María Elena. At this site we use brines extracted from the salar to produce potassium chloride, potassium sulfate, and lithium chloride solutions, which are subsequently sent to our lithium carbonate plant at the Carmen Lithium facility for processing. The main production plants at this site include the solar evaporations ponds systems, the potassium chloride flotation plants (MOP-H I and II), the potassium carnallite plants (PC I and PC I extension), the 6 OUR BUSINESS 114 potassium sulfate flotation plant (SOP-H), the potassium chloride drying plant (Dual Plant or MOP-S), the potassium chloride compacting plant (MOP-G3), the potassium sulfate drying plant (SOP-S) and the potassium sulfate compacting plant (SOP-G). The energy used consists primarily of solar energy, as well as electricity, fuel and gas sources. The Carmen Lithium facility site is located approximately 20 kilometers east of Antofagasta. The production plants at this facility include the lithium carbonate plant, with a production capacity of 180,000 tons per year, and the lithium hydroxide plant, with a production capacity of 30,000 tons per year. Lithium chloride (LiCl) solution is concentrated and purified in the lithium chemical plants through stages of contaminant removal (specifically boron, magnesium and calcium content) and conversion reaction to produce: technical grade lithium carbonate; battery grade lithium carbonate; technical grade lithium hydroxide; and battery grade lithium hydroxide. Electricity and natural gas are the main sources of energy for the operations of our Carmen Lithium facility. The following table provides a summary of our Salar de Atacama production facilities as of December 31, 2022: Facility Type of Facility (hectares) (1) Approximate size Nominal Production Capacity (thousands of metric tons/year) Weighted Average Age (years) (2) Gross Book Value (millions of US$) (2) Salar de Atacama (3) Potassium chloride, potassium sulfate, lithium chloride, and boric acid production Carmen Lithium facility, Antofagasta (3) Lithium carbonate and lithium hydroxide production ________________ 35,911 Potassium chloride: 2,680 Potassium sulfate: 245 Boric acid: 15 13.00 1,652.2 126 Lithium carbonate: 180 Lithium hydroxide: 30 5.59 661.2 (1) Approximate size considers both the production facilities and the mine for the Salar de Atacama. Mining areas are those authorized for exploitation by the environmental authority and/or Sernageomin. (2) Weighted average age and gross book value correspond to production facilities, excluding the mine, for the Salar de Atacama. (3) Includes production facilities and solar evaporation ponds. During 2019, we began to work on the expansion of discard deposit area of the new lithium hydroxide plant and accumulation ponds. We directly or indirectly through subsidiaries own, lease or hold concessions over the facilities at which we carry out our operations. Such facilities are free of any material liens, pledges or encumbrances, and we believe they are suitable and adequate for the business we conduct in them. Extraction Yields The following table shows certain operating data relating to each of our Salar de Atacama operations for 2022, 2021 and 2020: (in thousands, unless otherwise stated) 2022 2021 2020 Salar de Atacama (1) Metric tons of lithium carbonate produced 152.5 108.4 72.2 6 OUR BUSINESS 115 Metric tons of potassium chloride and potassium sulfate and potassium salts produced 984 1,407 1,476 ________________ (1) Lithium carbonate is extracted at the Salar de Atacama and processed at our facilities at the Carmen Lithium facility near Antofagasta. Potassium salts include synthetic sylvinite produced in the plant and other harvested potassium salts (natural sylvinite, carnallites and harvests from plant ponds) that are sent to Coya Sur for the production of crystallized nitrates. Reserves and Resources The mineral reserve was estimated for potassium and lithium dissolved in brines of the Salar de Atacama considering modifying factors for converting mineral resources to mineral reserves, including the production wellfield design and efficiency, pumping scheme, and recovery factors for lithium and potassium. The projected future brine extraction was simulated using a groundwater flow and solute transport model. Numerical modeling was supported by a detailed calibration process and hydrogeological, geological, and hydrochemical data within the exploitation concessions. Based on the current SQM production wellfield, as of December 31, 2022, which corresponds to the effective date of mineral resource and reserve declaration that is most representative of 2022, we estimate that our proven and probable reserves of lithium and potassium are as follows: Salar de Atacama—Summary of Mineral Reserves, Considering Process Recoveries (Effective December 31, 2022)1,2,3,4,5,6 Brine Volume (Million cubic meters) Amount (Million metric tons) Grades/Qualities (wt.%) Cut-off Grades (wt.%) Metallurgical Recovery (%) Lithium Proven mineral reserves (Years 1-4) Probable mineral reserves (Years 5-8) Total mineral reserves Potassium Proven mineral reserves (Years 1-4) Probable mineral reserves (Years 5-8) Total mineral reserves ________________ 143 107 250 143 107 250 0.18 0.14 0.32 3.03 2.12 5.15 0.20 0.05 0.20 0.05 0.20 0.05 2.33 2.16 2.26 1.0 1.0 1.0 52 52 52 74 74 74 (1) The process efficiency is based on the type of extracted brine at each well over the course of the simulation, the average process efficiency over the entire LoM is approximately 52% for lithium and approximately 74% for potassium. 6 OUR BUSINESS 116 (2) The values in the “Amount” column correspond to contained metallic lithium (LME) and potassium. (3) The average lithium and potassium concentration is weighted by the simulated extraction rates in each well (4) Comparisons of values may not add due to rounding of numbers and the differences caused by averaging (5) The mineral resource and reserve estimate considers a 0.05% w/w cut-off grade for lithium based on the cost of generating lithium product, lithium carbonate sales, and the respective cost margin. Based on historical lithium prices from 2010 and the forecast to 2040, a projected lithium carbonate price of US$15,000 per metric ton with the corresponding cost and profit margin is considered with a small increase to accommodate the evaporation area and use of additives. A similar analysis was undertaken for potassium where the cut-off grade of 1% w/w has been set by SQM based on respective costs, sales, and margin. (6) This reserve estimate considers the modifying factors of converting mineral resources to mineral reserves, including the production wellfield design and efficiency, as well as environmental and process recovery factors. The reserve estimate also considers the expiry of the Corfo Agreements in 2030 (end of LoM). The Qualified Persons for the Mineral Reserves are Rodrigo Riquelme and Gino Slanzi. Production well locations are based on the Measured and Indicated Resource zones. Due to the mixing of brines over time, hydrogeological processes, and pumping effects, the mineral reserve was classified based on time: • Proven Reserves were specified for the first four years of the simulation given that the model is adequately calibrated to the 2015 2020 period, and the initial portion of the projected simulation has higher confidence due to less expected short-term changes in pumping, conceptual hydraulic parameters, and the water balance, among other factors. • Probable Reserves were conservatively assigned for the last four years of the simulation considering that the numerical model will be continually improved and recalibrated in the future due to potential medium to long term changes in neighboring pumping, conceptual hydraulic parameters, and the water balance, among other factors. Probable reserves and inferred resources are being continually explored in order to be able to reclassify them as proven reserves and indicated or measured resources, respectively. This exploration includes systematic packer testing, chemical brine sampling, and long-term pilot production pumping tests. Complementing the reserve information, SQM has an environmental impact assessment (RCA 226/06) which defines a maximum brine extraction until the end of the Corfo Agreements (December 31, 2030). Considering the authorized maximum net brine production rates under RCA 226/06 and voluntary reduction plan announced by SQM, which is characterized by a reduction in future pumping from 1,280 L/s to 822 L/s during the 8 year LoM, a total of approximately 250 million cubic meters of brine will be extracted from the producing wells, corresponding to 0.32 million metric tons of lithium (considering processing efficiencies). The lithium and potassium resource were classified into three categories (Measured, Indicated, Inferred) according to the amount of information from the hydrogeological units, as well as geostatistical criteria. Hydrogeological knowledge was prioritized as the first classification criterion based on exploration, monitoring, and historical production data, while geostatistical variables were used as a secondary criterion. We estimate that our lithium and potassium resources as of December 31, 2020, which we also consider as an adequate representation of December 31, 2022, are as follows: Salar de Atacama—Summary of Mineral Resources, Exclusive of Mineral Reserves (Effective December 31, 2022)1,2,3,4,5,6,7 6 OUR BUSINESS 117 Brin Volume Amount (Million cubic meters) (Million metric tons) Grades/Qualities (wt.%) Cut-off Grades (wt.%) Lithium Measured mineral resources 2,254 Indicated mineral resources 1,435 Measured + Indicated mineral resources 3,689 Inferred mineral resources 1,614 Potassium Measured mineral resources 2,254 Indicated mineral resources 1,435 Measured + Indicated mineral resources 3,689 Inferred mineral resources 1,614 ________________ 5.4 2.8 8.2 2.6 49.8 30.0 79.8 34.9 0.20 0.16 0.18 0.13 1.80 1.70 1.77 1.77 0.05 0.05 0.05 0.05 1.0 1.0 1.0 1.0 (1) Mineral resources are not mineral reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the mineral resource will be converted into mineral reserves upon the application of modifying factors. (2) Mineral resources are reported as in-situ and exclusive of mineral reserves, where the estimated mineral reserve without processing losses during the reported LoM (A direct correlation between proven reserves and measured resources, as well as probable reserves and indicated resources was assumed. (3) Effective porosity was utilized to estimate the drainable brine volume based on the measurement techniques of the SQM porosity laboratory (Gas Displacement Pycnometer). The QP considers that the high frequency sampling of effective porosity, its large dataset, and general lack of material where specific retention can be dominant permits effective porosity to be a reasonable parameter for the resource estimate. (4) The values in the “Amount” column correspond to contained metallic lithium (LME) and potassium. (5) Comparison of values may not add due to the rounding of numbers and differences caused by averaging. (6) The mineral resource and reserve estimate considers a 0.05% w/w cut-off grade for lithium based on the cost of generating lithium product, lithium carbonate sales, and the respective cost margin. Based on historical lithium prices from 2010 and the forecast to 2040, a projected lithium carbonate price of US$15,000 per metric ton with the corresponding cost and profit margin is considered with a small increase to accommodate the evaporation area and use of additives. A similar analysis was undertaken for potassium where the cut-off grade of 1% w/w has been set by SQM based on respective costs, sales, and margin. (7) Andrés Fock is the QP responsible for the Mineral Resources. In regard to the amount of Measured and Indicated resources extracted during the 8 year LoM, the total extracted reserve without processing losses represents only 8.9% of the total Measured + Indicated Resource, and for potassium, the total extracted reserve without processing losses represents only 10.5% of the total Measured + Indicated Resource; this is more than sufficient to satisfy the requirements of RCA 226/06 and the Voluntary Extraction Reduction Plan for the project until the end of the current LoM. 6 OUR BUSINESS 118 The information presented in the tables above for Salar de Atacama were validated by: Mr. Andrés Fock is a Geologist with a masters in geology and more than 18 years of experience in the field of project evaluation, resource estimation, exploration and geostatsticas for different commodities such as lithium, potassium, nitrates, copper and rare earth elements. Since 2019, Mr. Fock is a Qualified Personas defined in subpart 1300 of Regulation S-K and is registered under No. 0388 in the Public Registry of Qualified Persons in Mining Resources and Reserves, in accordance with the Law for Qualified Persons and its current regulation in Chile. As a Geologist, he has evaluated multiple lithium brine and lithium-bearing pegmatite projects. Mr. Fock acted as project manager during the preparation of the TRS for the Mt. Holland Project. Mr. Fock is an employee of SQM. Mr. Rodrigo Riquelme Tapia is a Mining Engineer. He is currently partner and General Manager of GeoInnova, located at Antonio Bellet 444, Of. 1301, Providencia, Metropolitan Region, Chile. He has worked as a mining engineer for more than 23 years after graduation, of which 17 have been focused on resource and reserve estimation topics. Mr. Riquelme has been an external consultant for SQM since 2018, and visited the site in 2019. Mr. Riquelme is a Qualified Person as defined in subpart 1300 of Regulation S-K and is registered under No. 50 in the Public Registry of Qualified Persons in Mining Resources and Reserves, in accordance with the Law for Qualified Persons and its current regulation in Chile. Mr. Gino Slanzi is a Civil Engineer. He is currently the General Manager for Inprotec SPA and Senior Consultant for Pares & Alvarez. Mr. Slanzi is a Qualified Person as defined in subpart 1300 of Regulation S-K and is registered under No. 441 in the Public Registry of Qualified Persons in Mining Resources and Reserves, in accordance with the Law for Qualified Persons and its current regulation in Chile. He has worked for more than 35 years in the development of metallurgical mining projects, the optimization of production plants, and on management models. He visited the site in 2021. Mining Concessions for the Exploitation of Brines at the Salar de Atacama As of December 31, 2022, our subsidiary SQM Salar held exclusive rights to exploit the mineral resources in an area covering approximately 140,000 hectares of land in the Salar de Atacama in northern Chile, of which SQM Salar is only entitled to exploit the mineral resources in 81,920 hectares. These rights are owned by Corfo and leased to SQM Salar pursuant to the Corfo Agreements. Corfo cannot unilaterally amend the Corfo Agreements, and the rights to exploit the resources cannot be transferred. The Corfo Agreements provides for SQM Salar to (i) make quarterly lease payments to Corfo based on product sales from leased mining properties and annual contributions to research and development, to local communities, to the Antofagasta Regional Government and to the municipalities of San Pedro de Atacama, María Elena and Antofagasta, (ii) maintain Corfo’s rights over the Mining Exploitation Concessions and (iii) make annual payments to the Chilean government for such concession rights. The Corfo Agreements were entered into in 1993 and expire on December 31, 2030. Under the terms of the Corfo Agreements, Corfo has agreed that it will not permit any other person to explore, exploit or mine any mineral resources in the approximately 140,000 hectares area of the Salar de Atacama mentioned above. SQM Salar holds an additional 241,867 hectares of constituted Mining Exploitation Concessions in areas near the Salar de Atacama, which correspond to mining reserves that have not been exploited. SQM Salar also holds Mining Exploitation Concessions that are in the process of being granted covering 3,001 hectares in areas near the Salar de Atacama. 6 OUR BUSINESS 119 In addition, as of December 31, 2022, SQM Salar held Mining Exploration Concessions covering approximately 9,100 hectares and has not applied for additional Mining Exploration Concessions. Exploration rights are valid for a period of two years, after which we can (i) request a Mining Exploitation Concession for the land, (ii) request an extension of the Mining Exploration Concession for an additional two years (the extension only applies to a reduced surface area equal to 50% of the initial area) or (iii) allow the concession to expire. According to the terms of the Corfo Agreements, with respect to lithium production, the Chilean Comission on Nuclear Energy (CCHEN) established a total accumulated extraction limit set as amended by the Corfo Arbitration Agreement in January 2018, up to 349,553 metric tons of lithium metallic equivalent (1,860,670 tons of lithium carbonate equivalent), which is in addition to the approximately 64,816 metric tons of lithium metallic equivalent (345,015 tons of lithium carbonate equivalent) remaining from the originally authorized amount in the aggregate for all periods while the Corfo Agreements are in force. As of December 31, 2022, only 8 years remain on the term of the Corfo Agreements. The environmental permit Resolución de Calificación Ambiental (RCA No. 226/2006, issued on October 19th, 2006, by COREMA (Comisión Regional del Medio Ambiente or Regional Environmental Commission) authorizes SQM to extract brines via pumping wells from two areas in the western and southwestern portions of the areas defined in the Corfo Agreements. SQM refers to these brine extraction areas as AAE zones (Áreas Autorizadas para la Extracción or Authorized Areas of Extraction), and they are further divided based on the products historically generated in each sector: (i) The northern portion is denominated the AAE-SOP, where “SOP” signifies sulfato de potasio (potassium sulfate product), and it covers a surface area of 10,512 hectares which is equivalent to 29.27% of the total AAE area; (ii) the southern portion is referred to as AAE-MOP, where “MOP” indicates muriato de potasio (potassium chloride product), covering a surface area of 25,399 hectares that is equivalent to 70.73% of the total AAE area. SQM routinely carries out exploration activities within the areas involved in the Corfo Agreements and authorized by the Environmental Permits. These are aimed at maintaining the number of wells needed for production. The water that SQM uses for its mineral production in the Salar de Atacama is obtained from wells located in the alluvial aquifer on the eastern edge of the Salar de Atacama, for which the company has rights to use groundwater as well as the corresponding environmental authorization (RCA No. 226/2006). As part of the voluntary sustainability commitment assumed by SQM in 2020, the company will reduce its water consumption by up to 50% in 2030. SQM’s operations are subject to certain risk factors that may affect the business, financial conditions, cash flow, or SQM’s operational results, such as: the potential inability to extend or renew mineral exploitation rights in the Salar de Atacama beyond the defined expiration date (December 31, 2030) in the Corfo Agreements; risks related to being a company based in Chile; potential political risks as well as changes to the Chilean Constitution and legislation may affect development plans, production levels, and costs; and risks related to financial markets. 6 OUR BUSINESS 120 Mt. Holland Lithium Project, Australia Facilities The Mount Holland project is an integrated lithium project in Western Australia consisting of (i) an open pit mine and lithium concentrator operation, at Mount Holland, 120 km southeast of Southern Cross, and (ii) a lithium hydroxide (LiOH) refinery located in the Town of Kwinana, 26.5 km from the port of Fremantle, from where the LiOH will be shipped. The project is an unincorporated joint venture in which SQM owns 50% and Wesfarmers Limited, through a wholly owned subsidiary, owns the remaining 50% and is managed by Covalent Lithium Pty Ltd, an entity owned 50% by SQM and 50% by Wesfarmers. The project is accessed by land using the Parker Range Road and Marvel Loch-Forrestania road, which are an all-season gravel road. The Parker Range road is connected to the Great Eastern Highway which is a paved road with connectivity to Southern Cross, Kalgoorlie and Perth. Also, the project has its own access by air using an airstrip and infrastructure in the southern part of the mine. On September 11, 2017, Kidman Resources Limited (Kidman) and SQM entered into an asset sale agreement, pursuant to which SQM acquired its interest in the tenements for a total investment of SQM of US$110 million, consisting of an initial payment of US$25 million and a deferred payment of US$85 million, both payments subject to certain preceding conditions. All payments were completed by December 2018. In the asset sale agreement, the parties also agreed to form an unincorporated joint venture to mine and process spodumene ore into spodumene concentrate or lithium hydroxide. The Mt. Holland JV was established by the unincorporated joint venture agreement dated December 21, 2017, between SQM Australia and MH Gold, a then wholly owned subsidiary of Kidman Resources Limited (Kidman). Wesfarmers acquired Kidman Resources Limited in 2019, which resulted in Wesfarmers taking over Kidman Resources’ interest in the Mt Holland JV on September 23, 2019. SQM and Wesfarmers announced a positive investment decision in February 2021 following the completion of a feasibility study by Covalent. The Mt. Holland project is currently in development stage. Most construction contracts have been awarded and are underway, including the mining contract, the concentrator plant engineering and construction contract and the refinery construction contracts. The Mt. Holland project is focused on the exploitation of the resource in the Earl Grey pegmatite group. The Earl Grey pegmatite group consists of a main tabular pegmatite body, flanked by numerous minor dikes at both its top and bottom. The pegmatite field covers an area of up to 1 x 2 square km and a thickness of up to 100 meters. The pegmatites become progressively narrower and branched to the south and east of the main pegmatite until the main body divides into several narrower dikes. Isolated box rock enclaves are sporadically found within the pegmatite body. The pegmatites have an approximate strike of 210° to 220° and dip of 5° to 15° to the northwest. At their western margin, the pegmatites appear to be affected by gentle folding. The dip of the pegmatites is variable, with the pegmatite steepening from sub-horizontal in the south to 10° to 15° to the northwest north of the Earl Grey gold pit. Extensive exploration supports the characterization of the Earl Grey pegmatite, as the resource and reserve estimation, and it is comprised of surface mapping and extensive subsurface drilling carried out on the property in consideration that the pegmatite is not outcropping in the area. Exploration has predominantly been carried out by Kidman Resources since 2016, for the discovery and resource 6 OUR BUSINESS 121 definition. Since 2020, Covalent has conducted additional diamond drilling for metallurgical sampling, grade control drilling campaigns and improvement definition of the orebody geometry in the proposed starter pit area. Most of the exploration holes present at Earl Grey have been drilled using standard reverse circulation (RC) drilling techniques. Diamond drilling comprises boreholes with diameters of 47.6mm, 50.5mm, 63.5mm and 85mm, which are drilled for geological, metallurgical and geotechnical purposes. Recoveries for RC drilling range from 70-90% in this geological/geomorphological setting. The recoveries for diamond drilling are in the order of 95-100%. Recoveries diminish where shear zones or other structural disturbances have been crossed. The orientation of the boreholes is at relatively sharp angles (less than 90º) and, therefore, the intersected length is not considered as a representation of the true thickness of the pegmatite; its real thickness is determined through geological models. Resource drilling was initially conducted on broad exploration grids to determine the extent of mineralization. This was followed by a drill program on a 50 by 50 meter grid to support the resource estimate. Through the development of the Project in 2020, the first stages of the open pit were defined and the drilling program was designed for grade control based on higher density and geostatistical criteria. This information provides the design of the mine during the initial years of commissioning and supports the current definition of resources and reserves. Reserves and Resources Mt. Holland—Summary of Mineral Reserves at the End of the Fiscal Year Ended December 31, 20221 Amount Grades/Qualities Cut-off Grade Metallurgical Recovery Total MT SQM Attributable MT Li2O% Li2O% % Proven mineral reserves Probable mineral reserves 21.5 10.8 62.4 31.2 Total mineral reserves 83.9 42.0 ________________ 1.48 1.60 1.57 0.5 0.5 0.5 75% Concentrator: 85% Refinery 75% Concentrator: 85% Refinery 75% Concentrator: 85% Refinery 1. Mineral reserve tonnage and grade have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding. Metallurgical processes are designed for a nominal 2Mpta ore feed. Process recovery to concentrate is estimated at 75% for lithium oxide for predominantly spodumene mineralization and 0% for other mineralization types. Refinery process recovery is estimated at 85%. Tantalum recovery is estimated at 0%. A total operating cost of US$4,979 for LiOH production was considered in the reserve evaluation. The price, cost, and mass yield parameters, along with the internal constraints of the current operations, result in mineral reserves cut-off grade of 0.5% lithium oxide based on a selling lithium hydroxide price of US$ 11,000 per ton. David Billington is the QP responsible for the mineral reserves estimate with an effective date: December 15, 2021. No material changes since that date 6 OUR BUSINESS 122 Mt. Holland—Summary of Mineral Resources Exclusive of Mineral Reserves at the End of the Fiscal Year Ended December 31, 20221 Resources Amount Grades/Qualities Cut-off Grade Metallurgical Recovery Total MT SQM Attributable MT Li2O % Li2O % Measured Mineral Resources Indicated Mineral Resources Measured + Indicated Mineral Resources 27.0 61.0 88.0 Inferred Mineral Resources 7.0 ________________ 13.5 30.5 44.0 3.5 1.58 1.45 1.49 1.38 0.5 0.5 0.5 0.5 % 75% 75% 75% 75% 1. Mineral resource tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding. Mineral resources are reported exclusive of mineral reserves. Mineral resources are not mineral reserves and do not have demonstrated economic viability. Resources have been reported as in situ (hard rock within optimized pit shell). Pit optimization and economics for derivation of cut-off grade include mine gate pricing of US$ 800 per ton of 6% Li2O concentrate, AU$19 per bcm mining cost (LoM average cost-variable by depth), AU$65 processing cost per ton. Mining dilution set at 5% and recovery at 95%. Royalty fees 5%. The optimization considered for the concentrator is 75%. Costs estimated in Australian Dollars were converted to US Dollars based on an exchange rate of 0.75AU$:1.00US$. These economics define a cut-off grade of 0.50% lithium oxide. Kerry Griffin is the QP responsible for the mineral resource estimate with an effective date: October 6, 2021. No material changes since that date. Mt. Holland—Summary of Mineral Resources Inclusive of Mineral Reserves at the End of the Fiscal Year Ended December 31, 20221 Resources Amount Grades/Qualities Cut-off Grade Metallurgical Recovery Total MT SQM Attributable MT Li2O% Li2O% Measured Mineral Resources 71.0 Indicated Mineral Resources 107.0 Measured + Indicated Mineral Resources 178.0 Inferred Mineral Resources 8.0 ________________ 35.5 53.5 89.0 4.0 1.57 1.51 1.54 1.44 0.5 0.5 0.5 0.5 % 75% 75% 75% 75% 1. Mineral resource tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding. Mineral resources are reported inclusive of mineral reserves. Mineral resources are not mineral reserves and do not have demonstrated economic viability. Resources have been reported as in situ (hard rock within optimized pit shell). Pit optimization and economics for derivation of cut-off grade include mine gate pricing of 6 OUR BUSINESS 123 US$ 800 per ton of 6% Li2O concentrate, AU$19 per bcm mining cost (LoM average cost-variable by depth), AU$65 processing cost per ton. Mining dilution set at 5% and recovery at 95%. Royalty fees 5%. The optimization considered for the concentrator is 75%. Costs estimated in Australian Dollars were converted to US Dollars based on an exchange rate of 0.75AU$:1.00US$. These economics define a cut-off grade of 0.50% Li2O. Kerry Griffin is the QP responsible for the mineral resource estimate with an effective date: October 6, 2021. No material changes since that date. Mining Rights The Mt. Holland lithium project development envelope for the Mine and Concentrator is spread across three core mining tenements (M77/1065, M77/1066 and M77/1080), as well as exploration licenses, general purpose licenses and miscellaneous licenses (Project Tenements), covering an approximate area of 4,606 hectares. The majority of the project properties are currently registered in equal parts to MH Gold, an affiliate of Wesfarmers Limited, and SQM Australia, an affiliate of SQM. Other exploration rights in the Mt. Holland project are held by MH Gold Pty Ltd or Montague Resources Australia Pty Ltd, both of which are ultimately controlled by Wesfarmers Chemicals, Energy and Fertilizers (WesCEF). The project is a joint venture, in which SQM owns 50% and Wesfarmers Limited owns the remaining 50% (the “Mt. Holland Joint Venture”), and is managed by Covalent Lithium Pty Ltd (“Covalent”), a entity owned 50% by SQM and 50% by Wesfarmers. Covalent is neither the registered owner nor the applicant of the project properties under the Mining Act 1978 (WA) (Mining Act). The information presented in the following table (Mt. Holland project) has been validated by the following Qualified Persons: Mr. David Billington is a mining engineer with a BE in Mining, he has over 35 years of experience in mine planning, mine operations and management and project evaluation and consulting, for different commodities (Li, Ta, Sn, Fe2O3, Au, Cu, REE). As a mining engineer, he has worked at pegmatite projects producing Lithium for 10 years and evaluated multiple lithium pegmatite projects. He is a member of the Australasian Institute of Mining and Metallurgy (AUSIMM), 109676. He meets the experience criteria as competent person for Ore Reserves is style of mineralization as set out by the AUSIMM’s Joint Ore Reserve Committee (JORC). He is a Qualified Person as defined by subpart 1300 of Regulation S-K. Mr. Billington is an employee of Covalent Lithium, a joint venture between SQM and Wesfarmers Ltd. He is responsible for the reserve estimation for the Mt. Holland lithium project. Mr. Kerry Griffin is a qualified Geologist and has over 28 years of extensive hands-on experience in mine geology, mine development and management, designing and managing large scale exploration and resource drilling programs, resource modelling and estimation, the management and training of geological/technical teams in Australia, Africa, South/Central America, Central and SE Asia including more than 22 years in senior or management positions. His experience in lithium pegmatites includes exploration, resource development and mining in Australia, Southern Africa, and South America and as such, Mr. Griffin meets the experience criteria as a competent person for Ore Resources in this style of mineralization as set out by the AUSIMM’s Joint Ore Reserve Committee (JORC). He is a Qualified Person as defined by subpart 1300 of Regulation S-K. He is a current member of the Australian Institute of Geoscientists (3521) and the Society of Economic Geology. Mr. Griffin was employed by Mining Plus Ltd when the resource estimates were calculated. He is currently employed by Global Commodity Solutions. He is responsible for the resource estimation for the Mt. Holland Lithium Project. Mr. Andrés Fock is a Geologist and MSC in Geology, with 18 years of experience in project evaluation, resource estimation, exploration and geostatistics, for different commodities such as lithium, potassium, 6 OUR BUSINESS 124 nitrates, copper and rare earth elements. Since 2019, he is a Qualified Person as defined in subpart 1300 of Regulation S-K and is registered with No. 0388 in the Public Registry of Qualified Persons in Mining Resources and Reserves, in accordance with the Law for Qualified Persons and its current regulation in Chile. As a geologist, he has evaluated multiple lithium brine and lithium bearing pegmatite projects. Mr. Fock acted as project manager during preparation of the Technical Report Summary for the Mt. Holland Project. Mr. Fock is an employee of SQM. Transportation and Storage Facilities in Chile The transportation of our products is carried out by trucks that are operated by dedicated third parties through long-term contracts. Furthermore, we own port and storage facilities for the transportation and management of finished products and consumable materials. Our main centers for the production and storage of raw materials are the Nueva Victoria, Coya Sur and Salar de Atacama facilities. Other facilities include chemical plants for the finished products of lithium carbonate and lithium hydroxide at the Carmen Lithium facility. The Port of Tocopilla terminal, which we own, is the principal facility for the storage and shipment of our bulk products and packaged potassium chloride (MOP), nitrates and lithium carbonate. The Port of Tocopilla terminal facilities cover approximately 22 hectares and are located approximately 186 kilometers north of Antofagasta, approximately 124 kilometers west of María Elena and Coya Sur and 372 kilometers to the west of Salar de Atacama. Our affiliate, Servicios Integrales de Tránsitos y Transferencias S.A. (SIT), operates facilities for the shipment of products and the delivery of certain raw materials based on renewable concessions granted by Chilean regulatory authorities, provided that the facilities are used in accordance with the authorization granted and we pay an annual concession fee. The terminal facilities of the Port of Tocopilla have a weighted average age of 13.8 years and a gross book value of approximately US$148.9 million. The facilities include a truck weighing machine that confirms product entry into the port and transfers the product to distinct storage zones, a piezometer within the shipping system to carry out bulk product loaded onto ships, a crane with a 40 ton capacity for the loading of sealed product onto ships and a nitrate mixing facility. The storage facilities consist of a system of six silos, with a total storage capacity of 55,000 metric tons, and a mixed storage area of open and covered storehouses with a total storage capacity of approximately 250,000 metric tons. In addition, to fulfill future storage needs, we will continue to make investments in accordance with the investment plan outlined by management. The products are also put into bags at the Port of Tocopilla terminal facilities where the bagging capacity is established by two bag packaging machines, one for sacks and polypropylene FIBC big bags and one for FFS polyethylene. The products that are packaged in Tocopilla may be subsequently shipped at the same port or may also be consolidated into trucks or containers for its subsequent dispatch to clients by land or sea through containers from other ports, principally located in Antofagasta, Mejillones and Iquique. For the transportation of bulk product, the transportation belt system extends across the coastline to deliver products directly to the hatches of bulk cargo ships. The nominal load capacity of this shipping system is 1,200 tons per hour. The transportation of packaged product is carried out utilizing the same bulk cargo ships using barges without motors located in the dock and loaded by a crane with a 40 ton capacity from the Port of Tocopilla terminal. Thereafter, they are towed and unloaded using ship cranes to the respective warehouses. 6 OUR BUSINESS 125 We normally contract bulk cargo ships to transfer the product from the Port of Tocopilla terminal to our hubs around the world or to clients directly, who, in certain instances, use their own contracted vessels for delivery. Tocopilla processes related to the reception, handling, storage and shipment of bulk/packaged nitrates produced at Coya Sur are certified by the third-party organization TÜV-Rheinland under the quality standard ISO 9001:2015. 6.5 SUBSIDIARIES AND ASSOCIATES Information on SQM's main subsidiaries and associates is presented in detail in Annex 2. 6 OUR BUSINESS 126 7. SUPPLIERS MANAGEMENT 7.1 PAYMENT TO SUPPLIERS There are corporate procedures in place that address the payment of suppliers; for example, with respect to the payment of purchase orders, they state that payment must be made within 30 days, unless a different period is expressly established. In any case, our policy is to guarantee timely payment to our suppliers of goods and services. On average, payment is made 45 days after the supplier submits its invoice and it is received by SQM. Payment dates are calculated from the date on which the invoice arrives at SQM, duly drawn up and with the requested attachments. In the event of omission or error of any information in the invoice, modifications and the issue of a credit note for the total amount of the invoice to be corrected will be required, and partial credit notes will not be accepted. As a result, time limits are interrupted until the new, correctly prepared invoice is submitted. This is counted from the date of receipt of the invoice or the date of receipt of the goods by SQM, whichever is later. Invoices include the payment conditions stipulated in the respective agreements and purchase orders, as well as any early payment discounts in effect at the date of issuance. Currently, payment dates do not distinguish between critical and non-critical suppliers. Besides, we do not categorize them in this way; however, we have a list of strategic suppliers, based on which we are preparing an action plan to mitigate risks according to their critical variables, where we could review, according to their criticality, whether it makes sense to set special deadlines for any of these suppliers. In view of the above, we are working on an internal definition to segregate critical and non-critical suppliers. For foreign suppliers, a condition is generally used that establishes that payment will be made within the terms agreed with the supplier, which, depending on the particular case, may be more or less than the term specified in the procedure. By process, import purchases are supported by an advance payment and then the outstanding balance is paid against the bill of lading, which takes an average of 15 days. For those national or international suppliers with whom SQM has a stronger commercial relationship, payments are allowed once the goods are received at our warehouses or points of destination. At the company level, we do not have a calendar day target; however, we promote good practices for timely payments, respecting good faith negotiations between both parties based on corporate procedure. For this reason, our operations in northern Chile have set a medium-term target that, in general, all payments should be made no later than 30 days from the submission of the invoice. As a good practice, to encourage the development of local suppliers (Tarapacá Region and Antofagasta Region), we have defined cash payments for them. This same criterion has been applied to those service providers that we have preliminarily categorized as critical, regardless of their place of residence. To achieve these goals and in line with our Sustainability policy, we request and control that our service providers keep updated and certify compliance with their labor obligations through an external certifying company, validated for this purpose. 7 SUPPLIER MANAGEMENT 127 It should be noted that in November 2022 we implemented and informed all our suppliers that the ARTIKOS "Supplier Portal Service" (https://art-p-ptk.artikos.cl/SIAS/web_SQM/HomeProv.asp#) is available at no cost, so that they can check the status of their invoices and consistently monitor the status of each Electronic Tax Document (ETD) online. We have no interest amounts in arrears nor do we have any agreements registered in the Registry of Agreements with Exceptional Payment Periods of the Ministry of Economy. Payment to Suppliers 2022 Type of Supplier N° of Paid Invoices Total amount in MM$ N° of Suppliers Nacional Foreign Total Nacional Foreign Total Nacional Foreign Total 7.2 EVALUATION OF SUPPLIERS Tramo de Días Calendario Hasta 30 días 95,248 31,061 126,309 1,542,595 794,052 2,336,647 2,953 2,372 5,325 Entre 31 y 60 días Más de 60 días 91 243 369 1,933 460 2,176 418 1,165 11,858 38,949 12,276 40,114 27 12 203 452 215 479 At SQM we are aware that, as a multinational company with operations around the world, we have the responsibility to respect human rights and our commitments established in the Company's Sustainability, Ethics, and Human Rights Policy, even beyond what the law requires us to do, which is the minimum standard for our actions. Throughout our history, we have worked to improve (i) the quality of our production, (ii) fair treatment, (iii) environmental protection, and (iv) unrestricted respect for human rights, adhering to the highest international standards. We have formally adhered to the UN Guiding Principles on Business and Human Rights and the "protect, respect, and remedy" framework they enshrine, adopting them as our own. We seek to extend this commitment to human rights throughout our supply chain to ensure responsible sourcing. Therefore, in April 2022 we introduced our Responsible Sourcing Policy, which is based on the Sustainability, Ethics, and Human Rights Policy and provides a framework for application in our supply chain. We expect all suppliers with whom we engage to comply with applicable laws and regulations and to share our sustainability commitments in their own businesses. We urge all suppliers that provide services to SQM, including for inputs, services, consultancies, intermediaries, among others, to: • Respect the human rights of their workers • Care for the environment • Protect health and safety • Prioritize ethics and integrity in their businesses 7 SUPPLIER MANAGEMENT 128 • Promote fair treatment of their own employees To this end, in concrete terms we seek to ensure at least that they: • Enforce compliance with our Code of Ethics. • Know and understand our policies • Conduct a sustainability self-assessment on an annual basis. • Commit to provide further information if requested and/or participate in additional validation. • Apply corrective actions if necessary. In our Responsible Sourcing Policy we have defined that there are certain risks along the supply chain which, if they occur, imply a substantial breach of the Policy, but also of SQM's other corporate policies. A substantial breach is defined as incurring in a serious violation of human rights or engaging in intolerable conduct that represents a threat to the rule of law or human rights. In these situations, SQM may suspend or terminate the commercial relationship with the supplier that has incurred in such conduct. We are aware that, throughout the mining supply chain, as well as in the transportation and trade of minerals, there is a greater susceptibility to certain abuses that constitute serious human rights violations, which companies must avoid and commit to eradicate. In this sense, the following are considered a serious violation of human rights: • Incurring in any form of child labor as defined in Convention No. 182 of the International Labor Organization (ILO), ratified by Chile in 2000. • Adopting or tolerating practices of forced labor or any other type of modern slavery, including work under threat and any work for which the individual has not volunteered. • Any form of torture or cruel, inhuman, or degrading treatment. • Other abusive treatment, such as widespread sexual violence and other serious human rights violations. • Committing or participating in the commission of war crimes or other serious violations of international humanitarian law, crimes against humanity, or genocide. Likewise, understanding that mining activities such as those carried out by SQM present risks of possible involvement of non-state armed groups along the supply chain, which represent a threat to the rule of law and human rights, SQM will not tolerate any kind of direct or indirect support to these non-state armed groups. Direct or indirect support may include, but is not limited to, obtaining minerals, making payments, providing logistical assistance or equipment, performing acts or contracts on their behalf, among others. In this sense, the following are considered intolerable behaviors: • Directly or indirectly supporting non-state armed groups that illegally control work sites and operations, or that in any other way exercise control over transportation routes or mineral commercialization points. 7 SUPPLIER MANAGEMENT 129 • Directly or indirectly supporting non-state armed groups that illegally collect taxes or extort at access points to work sites or operations along transport routes or at points where minerals are commercialized. • Directly or indirectly supporting non-state armed groups that extort money from intermediaries, exporters, or international traders. In turn, in order to verify what is set forth in our policies, we have developed a supplier evaluation mechanism that considers 6 categories: Human Rights Corporate Social Responsability Businness Ethics Quality Management Occupational Safety and Health Environment During the first evaluation, 18 suppliers considered to be strategic for our operations were invited to evaluate the dynamics of the self-evaluation, suppliers' response time and levels, as well as SQM's response dynamics and certificate delivery deadlines, in order to adjust the tool to reality. Supplier Evaluation N° of Prospective Suppliers to Analyze1 N° of Evaluated Suppliers % of Evaluated Suppliers Total Purchases from Suppliers (MM$) Total Purchases from Evaluated Suppliers (MM$) % of Purchases from Evaluated Suppliers 1 N° of suppliers that had been analyzed during the period Tipo de Proveedor National Foreign Total National Foreign Total National Foreign Total National Foreign Total National Foreign Total National Foreign Total 2022 10 8 18 10 8 18 100% 100% 100% 1,544,178 844,859 2.389.037 161.151 74.935 236.086 10% 9% 10% In our evaluation methodology, we classified our suppliers into 5 categories depending on their compliance with the abovementioned criteria. Thus, an "A" rating corresponds to compliance with over 80% of SQM's expectations, "B" between 60–80%, "C" between 40–60%, "D" between 20–40%, and "E" between 0–20%. 7 SUPPLIER MANAGEMENT 130 The results show that the global average corresponds to a score of 83.7%, with the highest category corresponding to business ethics, while the lowest was environment and corporate social responsibility, in which 14 of the 18 suppliers were rated A, while 4 were rated B. This gives us a baseline to continue advancing in sustainability by working directly with our suppliers to further align our criteria as established in the program. 7 SUPPLIER MANAGEMENT 131 8. INDICATORS 8.1 LEGAL AND REGULATORY COMPLIANCE Relating to customers Law 19.496 on the Protection of the Rights of Consumers does not apply to the lines of business of SQM and its subsidiaries in Chile, provided that products are not sold to final consumers. Notwithstanding the above, the Company has procedures to ensure that the products it makes and sells meet all current regulatory provisions in the countries it operates in, and respects each of the aspects described in Chapter 6.1, Legal and Regulatory Framework. In this context, in 2022 the Company received no fines related to customers in any of its lines of business. Relating to employees To prevent and detect regulatory infractions related to employee rights, SQM has the following procedures in place: • Internal Order, Health and Safety Rules • Procedure for the “Identification, merging and verification of the SGIGC regulatory framework” • Procedure for the “Identification of legal requirements applicable to occupational health and safety" • Legal notifications on regulatory changes reported by the Vice President of Legal Affairs to company divisions; • Procedures for the prevention, detection, reporting and follow up on workplace and sexual harassment • Procedure for handling complaints related to inequity and/or discrimination. In 2022, SQM’s companies were subject to six administrative penalties (fines) issued by the Labor Bureau (Dirección del Trabajo), two of which were lodged in 2021 and 2019, but paid in 2022. The total amount of these fines was $23,219,352 Chilean pesos. Also in 2022, SQM companies were named in 40 lawsuits regarding tutela de derechos (seeking protection of basic rights), 19 of which were brought by direct employees of SQM and 21 from subcontracted workers; 25 of the suits were terminated and 15 are still in process. Relating to the environment Environmental protection, respect for human rights and overall impact on sustainability are ongoing concerns of the Company, both in its productive processes and throughout the supply chain. This commitment is backed by the principles the Company has set out in its Policy on Sustainable Development, Ethics and Human Rights. 8 INDICATORS 132 The Company operates under an Environmental Management System (SGA in Spanish), enabling it to continuously improve its environmental performance by effectively applying its Sustainable Development Policy. To do so, different divisions have individuals responsible for environmental management, including managers, assistant managers, superintendents, supervisors and environmental analysts. These individuals are responsible for day-to-day environmental management in the different operations where we are present. SQM also has two programs focused on compliance with current environmental legislation, one for Nueva Victoria and the other for Salar de Atacama, and we also manage our environmental risk matrices, continuously monitoring and managing the risks described in them. In all of its operations, the Company has developed environmental monitoring and follow up plans based on expert scientific studies. Following up on relevant variables defined for each project enables the Company to verify, for example, the status of vegetation, flora, fauna and aquatic life in ecosystems under protection. These follow-up plans are supported by a broad control network that includes monitoring points such as meteorological stations and wells, satellite images, plots for recording the status of vegetation and fauna and others. The activities carried out under these plans are reported regularly to the authorities, in accordance with the Company’s commitments under the resolutions approving SQM’s different projects. For the specific case of the Salar de Atacama operation, the Company has implemented an online platform (www.sqmsenlinea.com) that provides public access to all environmental information compiled by the Company in keeping with its commitments. SQM’s environmental monitoring of the ecosystems where the company has its facilities is supported by numerous studies that encompass a range of scientific findings from prestigious Chilean and international research centers, such as the National Research Council of Spain (CSIC) and the Universidad Católica del Norte. Among the environmental studies conducted by the Company for its new projects, major efforts are being made to register pre-Hispanic and historic cultural heritage and to protect heritage sites, in line with current legislation. These actions have been undertaken especially near the locality of María Elena (ME) and around the Nueva Victoria (NV) operation. This work is accompanied by community outreach activities and the development of sites of interest. Environmentally significant aspects of each project are identified and evaluated for their potential impacts, which requires in-depth knowledge of how ecosystems in the area of influence of our projects function. Knowing this allows us to manage and respond to any potential impact in advance. Each of our projects must be submitted to Chile’s Environmental Impact Assessment System. As of December 2022, we have environmental authorization for a total of 69 projects, 14 of which were approved with an Environmental Impact Study (EIA in Spanish) and 50 with an Environmental Impact Statement (DIA in Spanish). In 2022, the Superintendency of the Environment inspected our Nueva Victoria operation due to an incident involving an iodine leak, and the agency made a legal request for information on roadway permits, our Compliance Program and our Early Warning Plan. At our Orcoma operation, the same Superintendency made a legal request as to the status of the project, the implementation of mitigation and offset measures and the construction stage follow up plan. The authority also requested details about the type of closure used in protected areas (Caleta Buena, Estación Central and Estación del Carmen), and requested information on the preventive/corrective measures carried out and/or being implemented to prevent incidents. 8 INDICATORS 133 In 2022, Salar de Atacama received a visit from regional Health Ministry officials, who inspected the facility’s wastewater treatment plants (PTAS), the Cañón del Diablo non-hazardous industrial waste depots, the hazardous waste storage site, the osmosis plants, the maintenance area and restrooms. Our Coya Sur and María Elena operations were also visited by the officials from the Environment Superintendency, SERNAGEOMIN (National Geological and Mining Service) and the Health Ministry’s Antofagasta regional office. These inspections focused on the Emissions Declaration covered by the SD 138 decree, monitoring stations under SD 61, water and sanitation/PTAS plants, hazardous substance storage, hazardous waste management, the María Elena and Tocopilla decontamination plans and closure plans. In 2022, Puerto Tocopilla was inspected by the Environment Superintendency regarding the facility’s Pollution Control Plan, and information on its compliance with articles 10 and 13 of the SD 70 Pollution Control Plan was also legally requested. The former SQM site of Pampa Blanca was visited by the General Directorate of Water Resources (DGA) in 2022 to verify pond A9. In February 2019, the Superintendency of the Environment approved a compliance program for our Nueva Victoria operations. The plan is currently operational, and the sanction process initiated in 2016 has been suspended. This decision was confirmed by the Antofagasta Environmental Court in October 2020. To fulfill commitments made, in July 2020 we submitted the Environmental Impact Study for the project “Partial Modification of the Puquios de Llamara Reinjection System”, which is currently under evaluation (in 2022 a complementary addendum was submitted). In our Salar de Atacama operations, the compliance program previously approved by the Superintendency of the Environment was rendered null and void by the Environmental Court in December 2019. In November 2020, SQM filed a new version of the compliance program that addressed the observations made by the Superintendency. The Compliance Program was finally approved through Exempt Resolution N°38/F-041-2016 of August 29, 2022, thereby terminating the provisional measures imposed as well as the sanction process. As of December 31, 2022, the Company had completed 15% of the actions indicated in the program and reached 77% completion of the actions in progress. The commitments made under the Salar de Atacama Compliance Program include implementing a participatory monitoring program for the Hydrogeological Environmental Monitoring Plan, designing and implementing a community training program for environmental monitoring, gradually reducing the maximum brine extraction limit to 822 l/s by 2027, just under 50% of the authorized extraction rate; and reducing the total flow of industrial water to 120 l/s, equal to a 50% cut in the authorized flow rate. Lastly, all SQM production facilities have closure plans in place that have been approved by the respective authorities. These plans are based on criteria and measures that meet current regulations. 8 INDICATORS 134 Sanctions, Fines, Programs and Environmental Remediation Plans 2022 Enforceable Sanctions Total Environmental Fines Approved Environmental Compliance Programs Satisfactorily Executed Environmental Compliance Programs1 Submitted Environmental Remediation Plans Satisfactorily Executed Environmental Remediation Plans2 N° 0 0 2 N/A 0 N/A N/A: not applicable 1 The environmental compliance plans are in execution, therefore, it is not possible to know yet if they were satisfactorily executed. 2 The environmental compliance plans are in execution, therefore, it is not possible to know yet if they were satisfactorily executed. Fair Competition The Company has a Fair Competition Policy as well as a Protocol for the provision and use of sensitive information related to the lithium business. The framework set out in SQM’s Code of Ethics establishes the company’s commitment to respecting fair competition, and thus the respective policy sets out guidelines and expected conduct for employees to ensure fair competition laws around the world are respected. In this regard, all SQM board members, executives and workers are expected to understand and respect the laws of fair competition and to always keep in mind that failing to respect them could result in considerable penalties for SQM in the form of lawsuits and, in some countries, fines and criminal sanctions for board members, executives and/or employees involved in said behavior. Infringement of fair competition laws could also result in trade agreements being unenforceable and cause significant damage to personal and corporate reputations. For each case, the Company’s Fair Competition Policy sets out rules for conduct that should always be avoided, and other matters that must first be discussed with SQM’s Ethics and Compliance Division. That policy also contains best compliance practices that, when properly adhered to, will substantially reduce the likelihood that fair competition laws will be violated. This Policy is based on two central golden rules: i) never enter into anti-competitive contracts or agreements, and ii) never abuse a dominant market position. In 2022, the Company incurred no penalties in connection with this issue. Others SQM has a Crime Prevention Model that has been certified up to September 2023 and sets out mechanisms to prevent, detect, and respond to situations in which the Company could be found criminally liable. In terms of prevention, the Company has a Code of Ethics that establishes a standard of expected conduct for all of its collaborators. 8 INDICATORS 135 To foster a control environment, the Company has different corporate policies and procedures that reinforce its adherence to a culture of integrity. Furthermore, the Company has a robust training and communication program that educates its collaborators about the compliance program and raises awareness about the need to follow and implement it to the fullest. To detect infringements, the Company has a Complaints Channel that allows workers and third parties to report possible violations of Company policies and guidelines. (Details of these guidelines can be found in the chapter on Corporate Governance.) In 2022, no sanctions were issued in connection with this concern 8.2 SUSTAINABILITY INDICATORS BY INDUSTRY According to the Sustainable Industry Classification System (SICS), SASB/VRF, which provides a series of metrics to measure company performance in different industries, SQM is classified as a chemical industry. Considering the scope and nature of SQM’s business activities, this section will report on indicators from the “Chemical Industry Standard”. Relevant themes for the chemical industry SASB/VRF classification that will be reported on in this section, are: greenhouse gas emissions; air quality; energy management; water management; hazardous waste management; community relations; workforce health and safety; product design for use-phase efficiency; safety and environmental stewardship of chemicals; genetically modified organisms; management of the legal and regulatory environment; operational safety, emergency preparedness and response and activity parameters. Greenhouse gas emissions Indicators 1.- RT-CH-110a.1. Gross emissions-limiting regulations. 2.- RT-CH-110a.2. Discussion of long-term and short-term strategy or plan to manage Scope 1 emissions, emissions reduction targets, and an analysis of performance against those targets. global Scope covered under percentage emissions, 1 Our products are used in industries that are fundamental for human development and people’s wellbeing. This leads us to set very ambitious goals for GHG emissions reduction (Scopes 1 and 2) and incorporate some Scope 3 emissions categories. These goals are reflected in our Sustainability Plan, where we have set greenhouse gas emissions reduction goals, which include being carbon neutral for lithium, potassium chloride and iodine products by 2030 and for all of our products by 2040, taking 2019 as the base year. This involves a 90% reduction and 10% offset of emissions by 2040. The core work areas related to emissions are: • Mitigation through the quantification of our GHG emissions based on international methodologies that are verified periodically, in order to internally manage emissions at each of our production sites, allowing us to meet the reduction goals committed to in our sustainability strategy. These efforts include identifying, assessing and implementing opportunities to reduce energy consumption and GHG emissions and follow up on these measures. 8 INDICATORS 136 • Adaptation of our operations, production processes and logistics to the needs and specific risks of each project, incorporating climate change as one of their periodic evaluation factors. This is done to identify, assess and successfully manage possible impacts of the growing effects of climate change on these areas. • Management of emissions generated by their quantification, characterization, treatment and reduction, as per current environmental regulations. • Continuously seeking out alternatives to minimize emissions generated. We continuously monitor air emissions at all facilities. These efforts include preparing detailed projections of expected environmental effects, installing and implementing emissions abatement equipment and effectively monitoring emissions. We have meteorological stations that are crucial for monitoring solar evaporation processes at our operations. In addition to these measures, as part of its existing environmental monitoring plans, SQM conducts isokinetic measurements on smokestacks that are linked to the production process, along with dryers and boilers. During this period, we have focused on decreasing our per product emissions. Reducing Scope 1, 2 and 3 emissions (all of our emissions): • General: We decreased our emissions by 70% compared to 2020 sales (tCO2eq+/MUSD). • We decreased our LiOH emissions per ton produced by 7%. SQM estimates its total aggregate carbon footprint for its entire production chain and individual carbon footprints for different products. Emissions are estimated using the standards of the IPCC Guidelines for National Greenhouse Gas Inventories (2006), the GHG Protocol, ISO 14064 on Greenhouse Gases and ISO 14040 on Life Cycle Assessment. The factors used for electricity correspond to those published on the website of the National Energy Commission. These factors are for the power grid from which we contract energy. GHG estimates consider all stages, from mineral extraction processes to the finished product at the port. In regard to Scope 3 emissions, 4 of the 15 categories defined by the GHG Protocol--purchased goods and services, upstream transportation and distribution, business travel, and downstream transportation and distribution--are estimated. The emissions reported are under financial oversight. The gases included are CO2, CH4, N2O. It should be noted that our emissions are not subject to a tax or cap & trade; however, in Chile we do have a tax of US$5/tCO2 and are seeing changes, such as the modification of the tax threshold, which currently affects only facilities with an installed capacity greater than 50 MW thermal. Under this criterion, in 2022, SQM paid approximately US$ 326,000 for emissions released by boilers in Coya Sur. There is, however, a potential risk that all our emissions will be subject to this tax in the future. In calculating emissions, the following gases are not included: hydrofluorocarbons (HFC), perfluorocarbons (PFC), sulfur hexafluoride (SF6) and nitrogen trifluoride (NF3). For 2022, GHG emissions totaled 1,481,487 tons of CO2 eq, which can be broken down into 300,298 tons of CO2 eq (Scope 1), 508,076 tons of CO2 eq (Scope 2), and 673,113 tons of CO2 eq (Scope 3). The current 12.5% rise in emissions is the result of Company expansions to increase capacity. 8 INDICATORS 137 Greenhouse Gas Emissions Scope Metric Gases Included 2022 2021 2020 Direct GHG Emissions (Scope 1) Tons CO2 eq CO2, CH4, N2O 300,298 286,562 271,008 Indirect GHG emissions (Scope 2) Tons CO2 eq CO2, CH4, N2O 508,076 509,108 476,552 Other Indirect GHG Emissions (Scope 3) Tons CO2 eq CO2, CH4, N2O 673,113 521,065 415,291 Total emissions (1, 2 and 3) Tons CO2 eq CO2, CH4, N2O 1,481,487 1,316,735 1,162,851 Note: CO2 – carbon dioxide, CH4 – methane, N2O - nitrogen oxide. How is it used? The internal price of emissions is used as a criterion in assessing different types of projects implemented each calendar year, to encourage and strengthen more sustainable alternatives, meaning those that have less impact in terms of emissions, and those that would ultimately be more costly without the inclusion of this internal “tax”. Price of Carbon How is it set? SQM has established an internal price for carbon dioxide emissions of US$ 15 per ton released. The price was determined by analyzing emission reduction alternatives on a marginal abatement curve, with the cost per unit abated for our operations coming in around US$ 10-15 per ton. The current green tax system (in Spanish, SIV) and future changes its criteria from technology-based (boilers and turbines) to emissions-based (with a threshold of 25 kCO2e). to The pricing also considered the price in other international regulations, such as the European Union’s Carbon Border Adjustment Mechanism (CBAM), which will impose a duty on certain imported goods produced outside of the UE, including fertilizers. Analyzing the projected emissions potentially subject to this tax in each SQM operation, in addition to the company’s sustainability objectives. In 2022, the Company implemented some initiatives to support our greenhouse gas emission reduction goals. These are described below: • SQM’s Ground Transportation Area implemented various pilot programs designed to test new technologies that help improve transport efficiency. The main projects executed to date are the 8 INDICATORS 138 truck aerodynamics improvement pilot; reduced wait times and increased productivity (idle reduction); installation of a telemetry system and the construction of a fuel consumption monitoring platform; and training programs to improve driver performance. Thanks to these initiatives and the certification of our ground transportation partners, we have obtained the Giro Limpio certification, a new achievement that reaffirms the Company’s commitment to sustainability. • We are also incorporating electric forklifts and are using them in both the Carmen lithium carbonate chemical plant and in our shipping area. The advantages of these new forklifts include high availability owing to quick charging time (50% charge in 45 minutes); cost savings, based on a longer useful life; low maintenance compared to lead-acid battery-powered machines; the ability to deactivate hydraulic functions when the seat of the forklift is not occupied; the inclusion of an automatic parking brake to prevent movement on ramps and slopes; the use of “Curve Control” to reduce automatic speed during turns; and the implementation of “Local Safe”, a Radio Frequency Identification (RFID) technology that uses detection tags that can calculate proximity to people and other machines to an accuracy of 0.1 meter. This equipment has a zero-carbon footprint. • The Company also launched 34 entirely electric vehicles that are now being used in our operations. This new fleet included passenger buses, minibuses, mobile workshops, mobile checkpoints, the first mining-standard electric pickup truck and the country’s first high tonnage mining truck. In Tocopilla, we introduced the first 100% electric high tonnage truck in South America, which entered service in the Chilean mining industry after a successful trial in SQM operations. This truck will eliminate 4-5 tons of CO2 eq, equal to 20 medium-sized trees a month over a 50-year lifespan. Six new 100% electric buses were also added to the bus fleet and are now making trips within the Coya Sur, Maria Elena and Pedro de Valdivia sites. The vehicles are equipped with the latest technology available on the market and meet all legal safety standards. They also have a range of 200 km and capacity to transport 42 passengers. These vehicles operate just like conventional buses, with the same comforts and features. They are also quieter and do not vibrate, making the journey more pleasant. They are also safer, with four cameras that give the driver a greater range of vision. Together these initiatives have taken the company’s Sustainability Plan even further, and above all are bringing us closer to fulfilling SQM’s commitment to become carbon neutral in our products by 2040. As yet another facet of our commitment to sustainability, SQM reports to different programs such as CDP, the Dow Jones Sustainability Index, SASB and Huella Chile. We report our emissions inventory, product carbon footprint, corporate carbon footprint and our consumption and energy use, among other indicators. In an exercise in transparency, in 2022 SQM had its 2021 product carbon footprint verified by KPMG Auditores Consultores SpA. Air quality Indicator 1.- RT-CH-120a.1. Air emissions of the following pollutants: (1) NOX (excluding N2O), (2) SOX, (3) volatile organic compounds (VOCs), and (4) hazardous air pollutants (HAPs) 8 INDICATORS 139 We work hard to manage and monitor emissions of PM10 particulate matter and to that end have a vast air quality monitoring network in the town of María Elena and participate in the air quality monitoring network in Tocopilla. In regard to PM10 Air Pollution Control Plans, the Company has implemented a wide range of measures to meet its commitments to control and reduce these atmospheric emissions, including the following: • Since 2007, we have reduced PM10 emissions substantially in María Elena. This reduction can be attributed to operational changes implemented by SQM and has resulted in significantly improved local air quality and compliance with daily and annual PM10 standards. The stations -including the Air Quality Monitoring Network associated with the María Elena Pollution Control Plan- met the Annual Air Quality Standard for PM10 (50µg/m 3N) beginning with the 2010-2012 period at Estación Hospital and with the 2012-2014 period at Estación Iglesia. • In the case of Tocopilla, PM10 emissions generated by SQM's port operations are minor compared to other sources in the city. As part of the Tocopilla Pollution Control Plan, the commitments have been fulfilled and all measures necessary to mitigate emissions have been taken. In 2022, SQM's port operations reported PM10 emissions of 3.77 tons, marking a major reduction since 2007. In comparison to 2021 levels, this reduction remains lower than our commitment in the pollution control plan. Other Atmospheric Emissions Other Emissions Metric 2022 2021 2020 Volatile Organic Compounds (VOCs) Hazardous Air Pollutants (HAPs) PM PM10 PM2.5 NOx Tons Tons Tons Tons Tons Tons 4,913.8 5,753.1 7,370.9 442.3 403.7 412.4 2,334.4 2,122.9 2,582.1 102.1 96.8 88.2 83.5 89.5 84.6 1,273.2 1,072.6 1,086.8 SOx Note: PM – particulate matter, NOx – nitrogen oxides, SOx – sulfur oxides. Tons 1,448.8 1,390.1 1,469.2 The drop in VOCs in 2022 is mainly the result of the 1000 cubic meter reduction in kerosene consumption at Nueva Victoria. Meanwhile, the rise in SOx is primarily due to the 2,400-ton increase in sulfur consumed at Nueva Victoria. Regarding HAPs and total PM (2.5 and 10), the rise in these figures is proportionate to increased consumption of diesel, fuel oil and LNG, as applicable. In 2022, we launched an initiative to control particulate matter in the Port of Tocopilla, beginning with Pier 1, then moving to the south checkpoint and the control tower. The plan is to install a fourth sensor in the area around the mechanical arm. We have three sensors installed, forming a sort of boundary at the port. The internal control of product movements is very important for air quality, which is currently monitored in real time. The sensors are installed in strategic locations close to the community and consider the usual wind currents found in Tocopilla. This enables the internal control of air quality, which provides support for situations in which decisions need to be made quickly. 8 INDICATORS 140 PurpleAir sensors are instruments that measure the real time concentrations of particulate matter (PM) from 2.5 to 10 microns. A wifi connection transmits air quality data, which is then stored and can be viewed from any mobile device. Using a fan, an air sample is drawn across a laser beam, which reflects some of its light onto a detection plate. Just like dust shines in the sunlight, the detection plate measures this reflection as a pulse, and its length determines the size of the particles; meanwhile, the number of pulses determines the particle count, and the mass concentration (PM1.0, PM2.5 and PM10) is calculated using an algorithm. We currently focus on calculating PM10, as per the port’s particulate monitoring plan. This is just one of the sustainability projects that the Tocopilla Port is undertaking to make its operations more community- and environmentally friendly. Energy Management Indicator 1.- RT-CH-130a.1. percentage renewable, (4) total self-generated energy (1) Total energy consumed, (2) percentage grid electricity, (3) In our processes, we use a high percentage of solar energy, which is crucial to the solar evaporation pond productive operations at our facilities in Salar de Atacama, Nueva Victoria and Coya Sur. This method offers an advantage over other processes and is only possible because the Atacama Desert, where our operations are located, has extremely high levels of solar radiation, resulting in high evaporation rates that facilitate the processes used to concentrate salts in ponds year-round. SQM has approximately 3,000 hectares of solar evaporation ponds, allowing us to harness significant amounts of solar energy. Our operations are also powered by electricity obtained under special contract from the National Electric System (SEN) and from fuels, with cleaner alternatives always prioritized. SQM does not have self- generation capacity. Energy Consumption and Intensity Type of Energy Unit 2022 2021 2020 Consumption within the organization Non-renewable fuel consumption Renewable fuel consumption Electricity consumption Energy consumption outside of the organization Diesel Gasoline Total energy consumed external) % energy from the electrical grid % energy from renewable sources (internal and GJ GJ GJ GJ GJ GJ % % 4,503,011 0 2,124,364 4,334,316 0 2,156,219 4,358,865 0 2,082,022 855,491 0.04 7,482,866 28.4% 0% 770,715 0.03 7,261,250 29.7% 0% 722,712 0.04 7,163,599 29.1% 0% The upward trend in the consumption of fuel from non-renewable sources both within and outside of our organization is mainly owing to an increase in diesel fuel consumption. Within our organization, more 8 INDICATORS 141 than 9,600 m3 were consumed, while externally, more than 2,200 m3 was consumed by our subcontractors. In 2022, the Administration and Services Division, in collaboration with the Executive Vice President of Lithium, implemented the “Eco-Sustainable Camps and Checkpoints” initiative to install photovoltaic solar panels on these structures. In the initial stage, solar panel banks were installed on the Phase V sector of the Andino Camp, which represents 15% of all on-site residences. Thanks to these panels, we were able to reduce our carbon footprint and considerably decrease noise emissions in these facilities, as the residential complex had previously been operating 24-7 with diesel powered generators. Ten mini plants with 24x500W panels have been installed to date, generating 12 KW/H of power. That energy is stored in 10 lithium batteries that produce 30 KV of storage per plant, which means that each plant provides enough energy to power 10 rooms. The remaining stages (V to VII) are expected to have solar plants by the end of the first quarter of 2023, which will represent 25% of all rooms at Andino Camp and a 40% overall increase in photovoltaic panels in that sector. Water management Indicators 1.- RT-CH-140a.1. (1) Total water extracted, (2) total water consumed, percentage of each in regions with high or extremely high baseline water stress. 2.- RT-CH-140a.2. Number of incidents of non-compliance associated with water quality permits, standards, and regulations. 3.- RT-CH-140a.3. Description of water management risks and discussion of strategies and practices to mitigate those risks Responsible use of water is an important aspect of SQM’s production processes, as this resource is scarce in some of the locations where our operations are located. We hold duly authorized water usage rights for all operations and meet all related requirements and commitments. We also ensure that we use water efficiently and correctly manage water in the ecosystems of origin, always favoring recirculation and optimization in our processes. Along these same lines, we have implemented environmental monitoring and early warning plans to ensure these ecosystems are cared for. Our Sustainability Plan includes specific commitments to reduce water use and extraction. In an effort to fulfill our water management criteria, we have developed the following work areas: Gestión del agua Indicadores 1.- RT-CH-140a.1. (1) Total de agua extraída, (2) total de agua consumida, porcentaje de cada una en regiones con un estrés hídrico inicial alto o extremadamente alto. 2.- RT-CH-140a.2. Número de incidentes de no conformidad relacionados con permisos, estándares y reglamentos de calidad del agua. 3.- RT-CH-140a.3. Descripción de los riesgos de la gestión del agua y análisis de las estrategias y las prácticas para mitigarlos. Para SQM, el uso responsable del agua es un aspecto relevante de sus procesos productivos, dada la escasez de este recurso en algunos lugares en donde se emplazan sus operaciones. Poseemos derechos de aprovechamiento de agua debidamente autorizados para nuestras operaciones, por lo que cumplimos 8 INDICATORS 142 con todas las exigencias y compromisos asociados. Asimismo, velamos de forma permanente por el manejo eficiente del agua que ocupamos, y la correcta gestión hídrica de los ecosistemas de origen, favoreciendo siempre la recirculación y optimización en los procesos. En la misma línea, implementamos monitoreos ambientales y planes de alerta temprana para asegurar el cuidado de estos ecosistemas, y en nuestro Plan de Sostenibilidad adquirimos compromisos específicos para la reducción del consumo y extracción de agua. Con miras a dar cumplimiento a nuestra gestión hídrica, hemos desarrollado los siguientes ejes de trabajo: Quantification of and reporting on fresh water use by operation and product. Care and optimization of water resource use, including the implementation of industry best practices. Identification of possible impacts on surrounding ecosystems from surface water use. Monitoring and implementation of measures to ensure that water use in our operations does not adversely affect neighboring ecosystems and communities. Important sources of water for our nitrate and iodine facilities at Pedro de Valdivia, María Elena and Coya Sur are the Loa and San Salvador Rivers, which run near our production facilities. Those facilities have environmental permits to extract surface water at the following flow rates: . Maria Elena = 62.1 l/s; Coya Sur = 90.0 l/s and Pedro de Valdivia = 94.4 l/s. The water for our Nueva Victoria and Salar de Atacama facilities is obtained from wells near the production facilities. Salar de Atacama has an environmental permit to extract groundwater at a rate of 240 l/s. Under our Sustainability Plan and other commitments, we have limited that extraction to a maximum of 120 l/s. That reduction to 120 l/s was incorporated into the Environmental Impact Study, "Salar de Atacama Extraction Reduction Plan" which was published in January 2022 and is currently in the approval process. https://seia.sea.gob.cl/expediente/ficha/fichaPrincipal.php?modo=normal&id_expediente=2154490427. The water for our Carmen Lithium Plant comes from third parties, mainly from wastewater from Antofagasta, desalinated water and surface water (FCAB). We have had no significant issues obtaining the water needed for our operations. SQM regularly reports water consumed in production processes to the water authorities. We have had no non-compliance incidents related to water permits or water quality standards and regulations. Studies are also conducted to identify more ways to use water efficiently, and we evaluate each facility’s water management indicators on a yearly basis. Some of our measures to support efficient water use are: 8 INDICATORS 143 • Reincorporation of all water treated in SQM sewage treatment plants into its production processes. This water is reused in our processes at María Elena, Pedro de Valdivia, Coya Sur, Nueva Victoria and Salar de Atacama. • Reuse of process solutions to reduce freshwater consumption. • The industrial water used at the Carmen Chemical Plant comes from wastewater treated by the city of Antofagasta. The company has used this source to supply almost 73% of the industrial water needed for production processes. The rest of the consumption requirements are met with purchased, desalinated seawater. The extraction of fresh water for production purposes is subject to strict environmental assessment, which helps prevent damage to environmental receptors (vegetation, flora and fauna) associated with aquifers and surface water sources for which the Company has water extraction rights. In conjunction with these studies, extensive hydrogeological modeling is designed and validated under the supervision of national and international experts, and these models are used to regularly monitor the expected behavior of the relevant systems. Of the total groundwater resources extracted for Nueva Victoria in 2022, 895,908 m3 were re-injected as part of the mitigation measures for the Pampa Hermosa project in Salar de Llamara, Tarapacá Region. Sustainability and Water Resource Plan • We have committed to reducing our continental water consumption by 40% by 2030 and 65% by 2040. Water consumption at the Salar de Atacama operation has dropped by 50% since 2021 and will remain at half of the environmentally approved volume until 2030. • We have reduced our brine extraction by 23% since November 2020 and are moving towards decreasing brine extraction by 50% by 2028 in accordance with the commitments made in the Environmental Impact Study, “Salar de Atacama Extraction Reduction Plan”, which was submitted in early 2022. • Reduction of 0.1% in direct water consumption per ton of lithium carbonate produced and 20.9% reduction per ton of lithium hydroxide. • Reduction of 2.2% in water consumed for potassium chloride production and 5.6% reduction for potassium sulfate. • Reduction of 10.9% in water consumed in Iodine production. Our web portalhttps://www.sqmsenlinea.com/ the Salar de Atacama Online Monitoring portal, provides environmental information on our Salar de Atacama operation to communities and other interested parties. We have designed and implemented a system that allows us to provide information about water extracted and net brine extracted. This system also serves as a verification system for authorities and stakeholders wishing to verify our compliance with extraction limits, in keeping with current operating regulations. It also provides historical environmental monitoring data to assess and prevent potential impacts that our operation, other entities and natural phenomena such as climate change may have on protected areas. 8 INDICATORS 144 We are expecting to launch a similar process that will allow us to report on these variables for our Nueva Victoria operation soon. Water Extraction and Consumption Average TDS quality (mg/l) >1000 >1000 <1000 Extraction Location Loa River, Salvador River Pampa del Tamarugal / Salar de Atacama Aquifer Produced by third parties Classification Type Metric Surface water Groundwater Third party water Salt water Salt water Fresh water Total water extracted Total water consumed m3 m3 m3 Water extracted from areas with High or Extremely High-Water Stress Water consumed from areas of High or Extremely High-Water Stress m3 m3 % % 2022 2021 2020 6,311,835 6,525,669 6,280,144 21,961,378 23,749,455 23,758,474 2,000,340 1,610,488 1,438,821 30,273,553 31,885,612 31,477,439 29,377,645 31,007,776 30,619,358 100% 100% 100% 97% 99% 98% In order to optimize water consumption, we take all treated wastewater from SQM’s sewage treatment plants and recirculate it in our production processes. Approximately 1,252,021 m3 of water was reused in 2022 (operational estimate). The initiative “Optimization of Industrial Water Consumption” at our Salar de Atacama operation is an example of the actions we are undertaking to develop more sustainable and environmentally friendly operations. The third Fundamental Sustainability Regulation addresses efficient water use. As such, we must ensure that we install processes that allow us to use the resource more efficiently. With this in mind, in 2020 we began to implement a system that seeks to instill more respect for industrial water use and highlight imbalances reflected in the records in order to make our water extraction and consumption more sustainable. As a result, we have significantly reduced the volume extracted and optimized the use of industrial water through actions such as: • Analyzing water consumption in different production areas. • Creating an “Industrial Water Supply Report” for each area of Salar de Atacama in order monitor and control processes and operations that use this resource. • Moving from “Static Supply” to “Daily Industrial Water Supply” for day and night shifts in order to adjust to operational variations. • Creating the “Plant Stoppage Standard”, which involves reporting the stoppage time and release of cubic meters of water so that it can be used, and industrial water can be offered to critical areas such as Ponds and Services. • Implementing the “Daily Industrial Water Consumption Report”. This tool uses an automated dashboard to monitor daily extraction, the levels of industrial water ponds, daily consumption compared to water supply, a daily and weekly outline of consumption by area, and a comparison of water extraction versus actual consumption over the course of a given day. 8 INDICATORS 145 Among the risks associated with our water resources, we have identified the following: Changes in water rights laws and other legal provisions may affect our business, financial position and operational results. We hold water rights that are crucial to our operations. We obtained those rights from the General Water Directorate of Chile (DGA) to ensure a water supply from rivers and wells near our production facilities, and we believe these are sufficient for meeting our current operational needs. In January 2022, Chile’s National Congress approved a legislative bill that will modify the country’s Water Code, introducing several changes. One very pertinent one is the change in the duration of water rights. Under this new legislation, water rights: (i) will be temporary and granted for a maximum of 30 years (the specific duration will depend on the nature of the waterway and the availability of water in it); (ii) will be subject - entirely or partially - to expiration when not used; (iii) must adjust to human consumption and sanitation requirements, which shall take priority in regard to water use; and (iv) will be subject to a minimum ecological flow rate to ensure conservation of nature and the protection of the environment, as determined by the DGA. It is noteworthy that water regulation and distribution is one of the most important aspects addressed by the Constitutional Convention, and so new changes may also be enacted. Our water supply may be affected by geological changes and/or climate change. SQM’s access to water may be affected by geological changes, climate change, and/or other natural factors, such as wells drying up and/or reductions in water available in the wells or rivers we obtain our water from. These factors are beyond our control. The use of seawater for present and future operations could increase our operating costs. Any changes of this kind may have a material adverse effect on our business, financial position and operational results. To mitigate the risks associated with water, we have rigorous environmental monitoring plans that allow us to identify any potential unexpected deviations; these plans include the use of water from pump shafts to ensure our operational continuity. SQM is also constantly reviewing and evaluating risks in order to define strategies to mitigate them. We also have a Sustainability Division whose staff is responsible for defining company goals for reducing our water consumption. 8 INDICATORS 146 Hazardous Waste Management Indicator 1.- RT-CH-150a.1. Amount of hazardous waste generated, percentage recycled At SQM, we understand that one way to mitigate impacts on our environment is through efficient waste management. We manage waste in accordance with Chilean legislation, the environmental commitments we have made, and industry best practices. We focus on proper management, minimizing waste generated, repurposing waste and seeking new uses or the appropriate final disposal solution, thus reducing risk to human health, the environment and communities. The core areas of this work are: Continuously seeking alternatives to minimize waste generated.. Managing waste generated, by using criteria for quantifying, describing, treating and reducing waste and emissions, in line with current environmental regulations. Quantifying, separating, reusing and recycling solid waste in order to minimize its impact and promote a circular economy. We generate different kinds of waste, including: • Domestic and similar waste: from offices, cafeterias, restrooms and other such spaces. • Non-hazardous industrial waste: wood, HDPE, scrap metal, debris and plastics, among other waste. • Hazardous industrial waste: waste from inputs with hazardous properties and waste and other material contaminated by such waste, that have the characteristics described in Art. 11 of Supreme Decree D.S. 148/04. Waste management is one of the Company’s core responsibilities, and as such we take all necessary measures to ensure that it is done safely. The waste declarations we submit to the government’s Single Window reporting platform correspond to: • SINADER, a monthly declaration for non-hazardous waste in which we report to the environmental authorities the volume of waste removed from our industrial properties and validated by the waste disposal entity. • The SIDREP declares hazardous waste and is submitted as necessary, meaning each time a truck leaves a facility with this kind of waste, this document, generated through the Single Window reporting portal, is given to the transport driver. In this case, the driver and the final disposal facility validate the information we have included on the form. All of the companies that transport waste to final disposal sites have the appropriate authorization. SQM has developed plans and procedures to manage both hazardous and non-hazardous waste. We have eight temporary storage sites for hazardous waste authorized by the Regional Health Agency (Seremi de 8 INDICATORS 147 Salud), six authorized temporary storage sites for non-hazardous industrial waste and an area for disposing of domestic waste generated at our operations. Internal control of waste is carried out by both the operational area where the waste is removed from and the environmental compliance area. To verify that the waste reaches its final destination, tickets are requested from the receiving party and the process is then followed up through the Single Window reporting platform until it is closed. Internal audits are also conducted to verify that our projects are in compliance with all applicable environmental regulations. In 2022, 93.6% of hazardous and non-hazardous industrial waste, domestic and similar waste and other waste generated in our operations was sent off-site for final disposal using authorized transport. The remaining 6.4% was recycled or used for energy recovery. Hazardous waste is transported in accordance with regulations currently in force in Chile. SQM manages solid domestic waste at all facilities and camp accommodations and disposes of this waste in authorized landfills. In 2022, SQM did not generate hazardous waste that was disposed of or treated internationally. It should be noted that there was a significant rise in waste generated compared to the previous period, because of a declaration of debris by the Carmen Chemical Plant. We prioritize recycling and reusing inputs, opting to eliminate waste only as a last resort, and when we do, we work with authorized waste management companies. Waste Generation Type of Waste Unit Destination (inside or outside of the facility) 2022 2021 2020 Tons Tons Mining Waste Spent ore Discarded Salts Industrial Waste Hazardous Non-Hazardous Domestic and/or similar Others Note: ‘Others’ corresponds to mixed construction waste and debris declared by the Carmen Lithium Plant. Outside Outside Outside Outside 1,702 3,718 6,560 118 2,565 3,856 5,254 8,502 28,203,001 11,621,008 33,170,650 8,106,420 Tons Tons Tons Tons Inside Inside 38,730,152 7,417,533 3,141 1,682 4,810 190 The drop in spent ore between 2021 and 2022 occurred mainly because 48 heaps were closed in 2021 and only 40 in 2022. The rise in discarded salts in 2022 was mainly owing to the 48%+ increase in Halite/Bischofite harvested at the Salar operation. In hazardous waste, waste oil generated at Nueva Victoria and Salar de Atacama rose by more than 300 tons. There was also an increase of more than 570 tons of other waste generated at Nueva Victoria, Salar de Atacama and the Carmen Lithium Plant. SQM has implemented a range of initiatives focused on improving waste management. In 2022 at our corporate offices in Santiago, we began the first stage of a recycling program that currently accepts paper, tins, Tetra Paks, plastics and glass. A “Sustainable Cafe” was also held in the building’s entry hall to explain the correct way to recycle and how to use the dispensers installed on each floor. In this way, we are incorporating best practices into our daily work that are in line with our sustainability 8 INDICATORS 148 aspirations, seeking to reduce waste generated in both our operations and offices. A second stage is currently under study to add other waste products efficiently to our recycling program. All recyclables at SQM headquarters are taken to the Kyklos comprehensive recycling center, where they undergo a pretreatment process consisting of separating, compacting and preparing different types of recyclables, which are then sent to waste recovery plants, where they will be transformed into new products and materials. In 2022, nine waste removals were conducted at the building’s recycling depot, enabling us to recover 1,099 kg of waste. Cardboard 664 kg Plastics 211 kg Glass 182 kg Metal 6 kg Tetra Paks 36 kg The following savings were achieved through waste recycling: Energy (kWh) 4,020 Trees (#) 11 CO2 eq (kg) 1,017 Water (l) 17,587 Equal to: 23 months of average household consumption in Chile 188 reams of paper 80 days of average car usage (not including trips) 88 average showers At Nueva Victoria, in addition to the domestic waste management and recycling process, which includes six ReciPampa “green points” for collecting this material, awareness has also been raised among employees through informative booklets. The Environmental Projects Subdivision, in collaboration with the recycling firm Recynor, also organized three informative talks with facility staff about the correct use of the recycling facilities and proper waste separation. These efforts sought to raise awareness of the optimal use of the six “punto verde” collection depots, which are located at different points around the facility and at Iris camp and accept PET plastics, cardboard and paper, glass and aluminum tins, which are then transformed into other materials through recycling. SQM’s ReciPampa program recycled the following volumes of waste in 2022: • Cardboard and paper: 3,184 kg • PET: 1,549 kg • Glass: 30 kg • Metal: 46 kg This program had a positive impact on the environment, as the following indicators show: • 30,707 KWh of energy saved • 925,654 l of water saved • 15,358 kg of CO2 emissions prevented • 55 trees saved 8 INDICATORS 149 Community Relations Indicator 1.- RT-CH-210a.1. Discussion opportunities associated with community interests of engagement processes to manage risks and The towns located near SQM operations are small communities whose economies are usually based on agriculture and/or tourism. Tocopilla has a port, while María Elena is a mining town that is home to a nitrate “office” that dates back to 1926. Over the years, the town has grown into a mining service provider and has a future as a tourist attraction. In 2022, SQM continued the pre-construction process for the Orcoma iodine and nitrate-rich salt plant project, located in Huara Municipality in Tarapacá Region. In preparation, the Company began advance work with the communities of Huara, the largest town in the district, the farming communities of Bajo Soga and Colonos Rurales and the fishing village of Pisagua. Work in Huara district increased over the year, and our company believes forming early relations are the ideal way to engage with local communities, as it allows us to communicate with each other and make plans together before SQM starts up its operations in the area. In Tarapacá Region, the areas around our operations are predominantly inhabited by Aymara and Quechua indigenous communities and groups. SQM’s Salar de Atacama operations in the municipality of San Pedro de Atacama cover territory also inhabited by indigenous communities. The five closest are located to the south of San Pedro, namely Peine, Socaire, Talabre, Camar and Toconao, where Atacameña and Lickanantay ethnic groups are prevalent. The local government is led by the municipality of San Pedro de Atacama, which was created in 1980. Ethnic and territorial organization is led by the Council of Atacameña Peoples, which represents 18 of the area's 21 communities. Characterization of the Communities Tarapacá Region Facility Localities Characterization Population Education Nueva Victoria Iquique - Chanavayita - Caramucho - Cáñamo Pozo Almonte - La Tirana - Pintados - Victoria - Huatacondo - Tamentica Regional Capital, Capital of the Province of Iquique, Commune: Population: 191,468 Households: 66,986 Men: 94,897 Women: 96,571 Regional Capital, Capital of the Province of Iquique, Commune: Population: 15,711 Households: 8,926 Men: 8,987 Women: 6,724 Population Density: 83.70 Male Index: 98.3 Average Age: 34.3 Indigenous communities: 18% Population Density: 1.14 Male Index: 133.7 Average Age: 32.2 Indigenous communities: 43% 8 INDICATORS Head of household education (years): 12,3 School attendance: 95% Preschool attendance: 53% High school attendance: 75% University/college entrance: 38% Finished university studies: 74% Indigenous people education (years): 10,3 Head of household education (years): 10,0 School attendance: 86% Preschool attendance: 55% High school attendance: 56% University/college entrance: 20% Finished university studies: 78% 150 Alto Hospicio Commune: Population: 108,375 Households: 33,178 Men: 54,206 Women: 54,169 Population Density:188.86 Male Index: 100.1 Average Age: 28.8 Indigenous communities: 31% Orcoma Project Huara - Bajo Soga - Colonos Rurales - Pisagua Commune: Population: 2,730 Households: 2,871 Men: 1,501 Women: 1,229 Population Density: 0.26 Male Index: 122.1 Average Age: 36.7 Indigenous communities: 63% Indigenous people education (years): 8,6 Head of household education (years): 10,4 School attendance: 95% Preschool attendance: 56% High school attendance: 71% University/college entrance: 16% Finished university studies: 65% Indigenous people’s education (years): 8,6 Head of household education (years): 8,5 School attendance: 94% Preschool attendance: 48% High school attendance: 65% University/college entrance: 13% Finished university studies: 84% Indigenous people’s education (years): 7,5 Note: Demographic data of this table was obtained by the information from the 2017 census done by the Chilean Statistical Institute (Instituto Nacional de Estadística de Chile)- Source: www.censo2017.cl Antofagasta Region Facility Localities Characterization Population Education Tocopilla Port/ María Elena/ Coya Sur/ Salar de Atacama/ Planta Carmen Antofagasta Tocopilla Port Tocopilla: - Urco María Elena/ Coya Sur María Elena: - Quillagua Regional Capital, Capital Province of Antofagasta, Commune: Population: 361,873 Households: 112,451 Men: 181,846 Women: 180,027 Capital Province of Tocopilla, Commune: Population: 25,186 Households: 10,670 Men: 12,481 Women: 12,705 Comunne: Population: 6,457 Households: 1,959 Men: 4,092 Women: 2,365 Population Density: 11.79 Male Index: 101.0 Average Age: 33.3 Indigenous communities: 8% Population Density: 6.25 Male Index: 98.2 Average Age: 34.5 Indigenous communities: 8% Population Density: 0.52 Male Index: 173.0 Average Age: 35.4 Indigenous communities: 13% Head of household education (years): 12,1 School attendance: 96% Preschool attendance: 49% High school attendance: 74% University/college entrance: 36% Finished university studies: 73% Indigenous people’s education (years): 10,6 Head of household education (years): 11,2 School attendance: 95% Preschool attendance: 46% High school attendance: 79% University/college entrance: 27% Finished university studies:81% Indigenous people’s education (years): 10,5 Head of household education (years): 11,2 School attendance: 95% Preschool attendance: 46% High school attendance: 79% University/college entrance: 27% Finished university studies: 81% Indigenous people’s education (years): 10,5 Salar de Atacama San Pedro de Atacama: - Río Grande - Solor - Toconao - Talabre - Camar - Socaire - Peine - Machuca - Catarpe - Quitor - Larache - Yaye - Sequitor Comuna: Población:10,996 Viviendas: 4,144 Hombres: 6,161 Mujeres: 4,835 Population Density: 0,47 Male Index: 127,4 Average Age: 34,3 Indigenous communities: 52% Head of household education (years): 11,1 School attendance: 93% Preschool attendance: 53% High school attendance: 73% University/college entrance: 35% Finished university studies: 82% Indigenous people’s education (years): 9,1 8 INDICATORS 151 - Cucuter - Coyo - Guatin - Tulor - Beter - Rio Vilama - Solcor - Puna de Tocol - Alis - Celeste - Puques Note: Demographic data of this table was obtained by the information from the 2017 census done by the Chilean Statistical Institute (Instituto Nacional de Estadística de Chile)- Source: www.censo2017.cl SQM’s work aligns with our commitments to these communities, to our neighbors and the environment, as set out in the SQM Sustainability, Ethics and Human Rights Policy. This document outlines a commitment to the sustainable development of our business and affirms our desire to maintain close ties with communities located near our production facilities and to actively participate in their development. We engage in an open, ongoing and transparent manner with our neighbors through programs and initiatives developed with their participation, by mutual agreement, in which we share a common goal. Understading that social dynamics and other aspects are constantly changing in today’s world, we are always open to reviewing our policy for relating to and coexisting with indigenous and non-indigenous communities, taking into account key aspects such as: • Including a human rights approach, specifically those rights relevant to the community’s ethnicity. • Ongoing dialog, approachability, transparency, good faith and delivering on promises. • Respecting the decisions and structures of local assemblies and their representatives. • Creating shared value. • Working together to develop projects and formal agreements. • Accepting and keeping in mind that developing community relations is a process that unfolds in stages. • Taking into account the specific cultural, social and territorial characteristics of indigenous communities. • Being willing to look at complex issues that are of interest to the communities, especially because they are part of their world view. An example of this is environmental issues and their impact on indigenous peoples. • Strengthening the community engagement and relations area by employing local professionals and offices and using multiple communication channels. • Establishing formal agreements that incorporate a human rights lens, sustainability as a value, good faith, clear dispute resolution mechanisms and permanent working groups. 8 INDICATORS 152 Community Relations Team To meet the needs of local communities, rather than hiring external consultants, SQM has a team of in- house professionals who work directly with communities, engaging in dialog, establishing working groups, drafting agreements and designing programs with shared social value. The work of engagement is organized through our offices in each territory, to ensure we are in personal contact with our neighbors. We also use other communications channels such as meetings, phone calls, emails, the SQM community portal portaldecomunidades.sqm.com and apps such as WhatsApp. To establish this direct relationship with communities, we have formed a solid community engagement team, which is divided into two divisions: Nitrate and Iodine Communities and Public Affairs North Division, and the Sustainability and Communities Salar Division, both of which report to the Senior Vice President of Corporate Services. Community Engagement Strategy Our projects seek to create shared social value with communities present in the zones where we operate. Using the United Nations Guiding Principles on Business and Human Rights, the United Nations Sustainable Development Goals and the International Labour Organisation’s Convention 169 on Indigenous and Tribal Peoples as a guide, SQM promotes local sustainable development and respect for community autonomy through an ongoing process of participation and dialog that is aimed at forging mutually beneficial agreements and creating plans and programs with community benefits in priority areas such as education, health, social inclusion, entrepreneurship, historic heritage preservation and sustainable development. Furthermore, to generate informed assessments of the potential impacts of our projects, we provide ongoing, transparent information and promote participation and consultation in all circumstances required by current legislation, especially in regard to indigenous communities. We orient our work according to the standards of ILO Convention 169 and the United Nations Declaration on the Rights of Indigenous Peoples. As such, we are committed to: • Promoting citizen participation, providing timely, transparent information about our projects and reporting regularly on environmental matters, in accordance with current legal provisions. • Promoting the participation of indigenous communities and prior, free, informed and good faith consultation with communities that may be impacted by our projects in accordance with current legislation. • Respecting the autonomy and traditional values of the communities where our operation are located. • Promoting and supporting the sustainable economic development of communities and creating projects with shared value between our operations and neighboring communities. • Implementing communications channels that allow for ongoing dialog with the community and developing effective due diligence mechanisms for human rights. 8 INDICATORS 153 SQM has two main focal areas for our community engagement: indigenous communities and local development. Indigenous Communities Some of SQM’s projects operate in areas with a significant presence of indigenous communities. According to the standards of ILO Convention 169, the United Nations Sustainable Development Goals and its Declaration on the Rights of Indigenous Peoples—all of which our policy adheres to—and attending to best practices for mining industry relations with indigenous communities, SQM engages with indigenous communities and groups that are potentially affected by its projects in a spirit of good faith, participation, respect for indigenous cultures and autonomy and the search for shared value. In this regard, at SQM we strive to make our projects not only environmentally and socially sustainable, but also—and especially—conducive to fostering the development of indigenous communities and groups that are present in our areas of influence, with full respect for their rights, culture and territories and in adherence to the definition of indigenous peoples found in Convention 169. In summary, SQM’s approach to indigenous communities is based on the following work areas: - Informed, transparent, culturally appropriate participation. - Supporting the development of indigenous communities. Society and Local Development At SQM, we understand how important our presence can be for the communities situated near our productive operations and facilities, and for this reason a core aspect of how we manage our business is maintaining good relations with those communities, adapted to the specific needs and character of each territory, in order to have a positive, substantial impact on the lives of those living nearby. At SQM, our engagement with local communities includes a robust program of shared social value and best practices in regard to human, environmental and labor rights and in our production chain, among other aspects. We also understand the strategic role we play in providing structural support in some of the territories we operate in, and we accept that as a day-to-day responsibility as we work with the inhabitants of these localities. Community Action Areas: Attendant to the needs of the territories where we operate and based on the experience we have gained in working with communities, we have established four pillars of work for SQM’s Shared Social Value Program. These pillars have evolved over time, taking into account that human relationships and needs in the surrounding communities change and the programs themselves evolve as they achieve the objectives defined in partnership with our stakeholders. Action Areas: Social Development Education and Culture Community Wellbeing, Health and Safety Cultural and Historical Heritage 8 INDICATORS 154 Focusing on these areas has allowed us to build our experience and enhance our work over time. This has resulted in long-term initiatives in which we collaboratively co-construct social development programs that give communities the tools they need to drive their own development. This approach also has met with approval by our communities. Social Development: SQM has done noteworthy work with farmers to develop projects that incorporate technology and innovation into production, as well as others that protect the legacy of more traditional practices, depending on the community. Added to this are projects that support new and existing businesses among more urban populations through training opportunities and access to funding. We have strengthened this last aspect especially in the past two years, with interesting results. Education and Culture: SQM has developed programs focused on themes complementary to the public education system, especially for schools in remote areas with multi-grade classrooms, thereby helping improve the quality of education. In 2021 and 2022, the introduction of programs based on technology, robotics and experiential learning have been pivotal. Community Wellbeing, Health and Safety: This line of work came out of communities’ requests for sports and other programs to meet needs that local residents identified. The Company organized women’s soccer and other initiatives designed to include individuals with disabilities, complementing its efforts with the support of institutions that promote inclusive sports. This pillar also includes health care programs such as the mobile dental clinic, professional support services and the provision of supplies that have been in high demand due to the pandemic. We have kept these programs going because of the evident need for health services in remote areas. Cultural and Historical Heritage: This pillar includes projects aimed at restoring and increasing appreciation of heritage sites of Pampa and indigenous cultural legacies, depending on the locality, with special focus on areas where such initiatives are not supported by other companies or the Government and/or where cultural traditions or sites are at risk. Community engagement, working groups and multi-sector coordination among neighboring towns Over the years, we have learned that the best way to engage in effective dialog is through working groups, which develop their own dynamic in line with the territory and issue being addressed. However, all agree that the makeup of these groups should be approved by the community. In the past, participants have included representatives of different indigenous and ethnic groups, unions, associations and other local groups, all validated by their base. Some groups have expert community advisors who serve as counterparts for company professionals. All these groups meet regularly and have signed memos of understanding, work agreements and/or operational bylaws, depending on their nature. These structures are intended to help guide collective community-company actions. One outstanding example of this way of working is the working groups in the Huara Municipality, in Tarapacá Region, where SQM will soon begin construction of an Iodine and Nitrate Plant. More than a year ago, well before the startup of this new operation, the Company established working groups with communities in each locality and launched shared social value programs, with tangible results. 8 INDICATORS 155 Current Working groups in 2022 Presented by Commune from North to South Mesa/ Instancia/ Tarea Localidad/ Comuna Faena Huara Working group Bajo Soga Working group Pisagua Working group Huara, Huara Bajo Soga, Huara Pisagua, Huara Working group Rurales Colonos Sector Colonos Rurales, Huara Orcoma Orcoma Orcoma Orcoma Working group Agrupación Sindicatos Costeros Caramucho y Cañamo, Iquique Nueva Victoria Working group STI N°1 Chanavayita Chanavayita, Iquique Working group STI N°2 Y N°4 Chanavayita Chanavayita, Iquique Working group STI N°3 Chanavayita Working group STI N°3 Caramucho Working group Youth Chanavayita Chanavayita, Iquique Caramucho, Iquique Chanavayita, Iquique Nueva Victoria Nueva Victoria Nueva Victoria Nueva Victoria Nueva Victoria Working group Jehovah's Land Multicultural Indigenous Association Working group Desert Youth Aymara Indigenous Association Working group Aymara Peasant Indigenous Association of the Pampa del Tamarugal Victoria Working group Huatacondo Working group Tamentica Working group Sector Bellavista Working group Colonia Pintados, Pozo Almonte Nueva Victoria Colonia Pintados, Pozo Amonte Nueva Victoria Pampa del Tamarugal, Pozo Almonte Nueva Victoria Victoria, Pozo Almonte Huatacondo, Pozo Almonte Tamentica, Pozo Almonte Sector Bellavista, Pampa del Tamarugal, Pozo Almonte Nueva Victoria Nueva Victoria Nueva Victoria Nueva Victoria Working group with the fishermen union of Tocopilla Tocopilla Puerto Tocopilla Safety advisory consultancy in ground transportation Tocopilla Advisory board El Puerto Cowork Tocopilla Puerto Tocopilla Puerto Tocopilla Safety advisory consultancy in ground transportation María Elena/María Elena Commune safety advisory Tourism Working group Working group with the indigenous community Quillagua Aymara María Elena/María Elena María Elena/María Elena Quillagua/María Elena Working group Quillagua Rural Drinking Water Quillagua/María Elena Working group Hydroponic Cooperative of Quillagua Quillagua/María Elena Technical Working group with the Atacameña de Camar Indigenous Community Working group con la Comunidad Atacameña de Toconao Camar Toconao Coya Sur Coya Sur Coya Sur Coya Sur Coya Sur Coya Sur Salar de Atacama Salar de Atacama 8 INDICATORS 156 Working group with the Atacameño Indigenous Community of Talabre Working group with the Atacameño Indigenous Community of Socaire Río Grande Working group Viticulture Working group Women and Mining Working group (jointly with the Mining Secretary, Women and Gender Equality Secretary and Mining companies) Talabre Socaire Rio Grande Toconao Salar de Atacama Salar de Atacama SQM Salar SQM Salar Antofagasta Corporate Offices Women and Mining Working group (jointly with the Mining Secretary, Women and Gender Equality Secretary and Mining companies) Santiago Headquarters Evaluating Our Performance As part of the controls and commitments in place at SQM, all of our operations and expansion projects are subject to environmental assessments based on current regulations. This includes measuring the impact of our operations on neighboring communities and conducting public consultations, indigenous consultations and other community outreach. We use our own staff for this purpose and create permanent ties with the community, which sets our Corporate Social Responsibility program apart from others that outsource this work. We continue to use the M-Risk software program to manage our community engagement program, as it enables us to standardize information and record and control the company’s work with its neighbors, thereby creating uniform records of each interaction. Each year, we evaluate our programs and impacts prior to making new commitments. We assess initiatives in progress, including their performance and approval rating, in direct conversations with community members. We also apply perception and assessment studies in the territories, including the SQM Perception and Image Survey in Tarapacá and Antofagasta regions, which was conducted for the second year in a row in June and August 2022, respectively, by the firm Feedback. In 2022, the Compliance area used the Bow Tie methodology to conduct a survey of risks and conflicts in communities, in order to provide advance warning of high-risk scenarios and their causes. The results of this diagnostic tool are being shared with the areas involved and will be published internally in 2023. Shared Social Value Programs The following are some of the programs SQM implemented in 2022. Social Development Programs in this sphere focused on agricultural development and included work with the Atacama Tierra Fértil Program and other social development initiatives and/or programs. 8 INDICATORS 157 The following initiatives were carried out as part of the Atacama Tierra Fértil Program: Program / Initiative Place Huara Pozo Almonte Pozo Almonte Working dialogue with farmers from Bajo Soga Desarrollo Unidad Productiva Ganaderos de la Pampa del Tamarugal Agricultural Research and Development Center Meeting of Innovation and Agricultural Entrepreneurship in the Tarapacá Region Agricultural development in Pintados Water Use Management and Hydroponics Ayllu Wine Production Program Soilless Crop Program Garlic Recovery Crop Program Fodder Enabling Support to the Association of Irrigators and Farmers of Soncor Soncor, en San Pedro de Atacama Catarpe, en San Pedro de Atacama Ayllu Catarpe Demonstration Plots Alto Jama, en San Pedro de Atacama Neighborhood Orchard Club of Alto Jama Pozo Almonte Quillagua San Pedro de Atacama San Pedro de Atacama San Pedro de Atacama San Pedro de Atacama Región de Tarapacá List of main programs with a focus on Social Development: Program / Initiative Place “Activate yourself” Huara “Pisagua Active” program Support to entrepreneurs from Laguna Verde Photovoltaic System – Farmers from Pintados Emprendepalooza (entrepreneurs’ festival) Tamarugal 2022 “Sabores y Saberes” Sustainable María Elena program Recycling program Drinking water plant of Camar Photovoltaic plant for Camar Rural Cooperative / Agricultural training Support of water managament Cowork in the port Nobody stop us! Tournament Crazy for Recycling Alianza Mujer Atacameño: Individual Support Fund Education and Culture Huara Pisagua Iquique Farmers from Pintados, in Pozo Almonte Pozo Almonte Quillagua María Elena Sostenible María Elena y Quillagua Camar, en San Pedro de Atacama Camar, en San Pedro de Atacama San Pedro de Atacama San Pedro de Atacama Quillagua, María Elena, Tocopilla y Pozo Almonte Iquique, Alto Hospicio, Pozo Almonte, Huara, Tocopilla, María Elena, Antofagasta y San Pedro de Atacama Tocopilla, Quillagua y María Elena San Pedro de Atamaca SQM supports programs that provide skills development tools for students and teachers, for the purpose of reducing learning gaps in schools located far from major urban centers. 8 INDICATORS 158 We support educational initiatives that focus on closing the learning gaps that exist in schools near our operational sites. These proposals are intended to complement teachers’ knowledge, providing classroom resources and building a bridge between schools and the company. SQM staff serve as volunteers in some training courses, especially technical and vocational ones. SQM’s projects in this area respond to needs in the regions where we are present, with the understanding that in the future, many students will remain in the region to work, some even joining the company. Some of the programs implemented in 2022 are: Program / Initiative “I learn with you” program “ViLTI SeMANN” program Enhancing Education in the North of Chile Apprentices’ program Technical Training Program for Communities From Pisagua to Huara Environment care with Verdical Support to programs of “Enseña Chile” Foundation Elaboration and edition of Kunza guide to 5th y 6th grade students Study Leveling Program Year 2022 Leadership and School Coexistence Workshop Support to América B-10 school Support to Don Bosco school Innovation carnaval Alternance program Propaedeutic Lecture “A place only for us” Diploma “Learning Processes in Early Childhood” Girls in STEM Camp Community Wellbeing, Health and Safety Place Pozo Almonte, Antofagasta, Tocopilla and María Elena Antofagasta, Tocopilla, María Elena, Quillagua, Colonia de Pintados, La Huayca and La Tirana Pozo Almonte, Alto Hospicio, Antofagasta, María Elena and Tocopilla Huara, Pozo Almonte, Pisagua, Pica, Alto Hospicio, Colonia de Pintados, María Elena, Calama, San Pedro de Atacama, Toconao, Camar, Socaire, Peine and Antofagasta Pozo Almonte, Huara, Tocopilla, María Elena, San Pedro de Atacama, Antofagasta and Santiago Huara Tocopilla San Pedro de Atacama San Pedro de Atacama San Pedro de Atacama San Pedro de Atacama Calama Calama Antofagasta, Tocopilla and Calama Antofagasta and Calama María Elena and Tocopilla María Elena María Elena Antofagasta In 2022, we continued to promote and support sports in the communities near our operations. 8 INDICATORS 159 Every year we receive requests from institutions and associations asking us to donate to and host events to promote and finance sports events in their communities. We understand how valuable sports are to people and how they teach young people valuable lessons about teamwork, consistency, healthy competition, respect and other skills. As for health and wellbeing, health and other high quality care programs have become priorities for communities far removed from urban centers and are important to the Company as well, because of their positive impact. Some of our programs developed in the period are: Program / Initiative Place Smiles’ Route Project Expansion of Colonia Agrícola rural hospital in Pintados Medical program Therapeutic greenhouse Mobile Dental Care Program Community Pharmacy Collaborative work programs with the community of Cucuter AMA: Cancer Preventive Operation Support to Sports Organizations in Tarapacá and Antofagasta Sportswear delivery in Bajo Soga Support to Tocopilla Sports Club Mini worlcup tournament Extracurricular football Academy Celebration of the World Day of Physical Activity Toconao football academy Celebration of the First Alto Jama Family Union Baby Soccer Championship Program of Activities with Older Adults Support to Bodyboard diving Club E-Karts racing circuits Safer routes Safe summer Safety guardians Cultural and Historical Heritage Huara Pintados, Pozo Almonte Tocopilla María Elena San Pedro de Atacama San Pedro de Atacama Cucuter, in San Pedro de Atacama San Pedro de Atacama Tarapacá and Antofagasta regions Huara Tocopilla Tocopilla Tocopilla Tocopilla Toconao, en San Pedro de Atacama Alto Jama, en San Pedro de Atacama San Pedro de Atacama Antofagasta Pozo Almonte, Tocopilla, María Elena and Toconao Pozo Almonte Quillagua Tocopilla and María Elena For many years, we have worked with the Humberstone and Santa Laura Nitrates Museum Foundation, the Chacabuco Nitrates Museum Foundation, the Pedro de Valdivia Nitrates Museum Foundation and the Huanchaca Ruins Foundation, providing resources and lending our experience, as well as having an active presence on their boards. As the natural heirs of the nitrates industry, for over a decade now SQM has participated in initiatives that pay tribute to the history of this industry in Tarapacá and Antofagasta regions. 8 INDICATORS 160 This commitment has taken the form of donations to support the operation of the historic Santiago Humberstone and Santa Laura nitrates “offices”, the Chacabuco Nitrates Museum Foundation and the Huanchaca Ruins Foundation in Antofagasta, as well as complementary work to help maintain these sites and museums. Added to this, SQM also supports new projects undertaken by these same institutions that resonate with us. Some of our initiatives developed in this area are: Program/Initiative Heritage Day Celebration Football Film Festival Celebration of National Holidays in Humberstone Celebration of the 143rd Anniversary of Pisagua Heritage Rescue Wood Workshop Support to María Elena Foundation 2nd Version of the Photographic Contest "María Elena: We are Life Under the Sun" Casa Telar Program Celebration of the Third Meeting of Lakitas "Ckoy Nisaya Ckuri" (Voice of the Wind) Support for the Improvement of the Niño Jesús Sequitor and Checar Chapel, Stage 2 Reconstruction of the Church of Toconao “Ampara Lurata” workshops Percussion workshops Rescue of whool handcrafts from Pampa Place Pozo Almonte, María Elena and Tocopilla Provincia de Tocopilla Pozo Almonte Pisagua Quillagua María Elena María Elena San Pedro de Atacama San Pedro de Atacama San Pedro de Atacama Toconao Pozo Almonte Pozo Almonte Quillagua Iquique, Pisagua, Mamiña, Huara and Pozo Almonte (La Tirana) Florist workshop of Pampa Local workers Percentage of local employees 2022 53.6% 2021 53.0% At SQM, as of December 31, 2022, we have 53.6% of our own workforce working and residing in the Tarapacá and Antofagasta regions, regions that are considered local to us. 8 INDICATORS 161 Occupational Health and Safety Indicator 1.- RT-CH-320a.1. (1) Total recordable injury rate (TRIR) and (2) Fatality rate for a) direct employees and b) contract employees 2.- RT-CH-320a.2. Description of efforts to assess, monitor and reduce exposure of employees and contract workers to long-term (chronic) health risks. Some of our health and safety indicators for 2022 are shown below. Total Recordable Incident (or Accident) Frequency (TRIF) Type of Employee SQM Employees* Contractors SQM Total Note: Calculation factor per 200,000 hours. 2022 0.31 0.05 0.15 The main hazards that have caused injury due to accidents are: operation of equipment and vehicles, operations involving explosives, handling of hazardous substances, high temperature processes, intervention in energized equipment, operation of mobile equipment and machines, working at height, hoisting and lifting operations, working in confined spaces, hot work and intersecting tasks, among others. The most common injuries related to workplace incidents and/or accidents are: contusions, burns, fractures, cuts, sprains, and irritation, among others. The primary measures adopted to minimize workplace risks and hazards, incidents and accidents are: • Eliminating exposure to the line of fire, improving the quality of hazard identification and risk appraisal, having established instructions and standards, and reassessing these when work conditions change. • Installing safety mechanisms on connections for pressurized transfer systems to prevent accidental disconnection. • Strengthening controls to ensure that no safety mechanisms are left inoperable. • Before and during driving, being alert to the presence of pedestrians and obstacles, only driving authorized, inspected vehicles, reviewing and following the Rules for Transit and Transport, and completing the pre-use inspection and checklist for vehicles and equipment. • Following maximum weight limits when operating equipment. • Respecting speed limits and always driving at a speed that is reasonable and prudent for the conditions. • Ensuring that hoisting equipment and accessories are certified and inspected. 8 INDICATORS 162 • Ensuring that all personal protective equipment suitable for working in areas and on tasks at high temperatures is on hand. • Isolating all energies identified at their point of origin, ensuring that the correct equipment or circuit is blocked, testing that energy to the circuit to be handled is at zero and that there is no residual energy. • Learning about the risks and proper conditions for handling and storing hazardous substances. • Isolating sectors for height work from lower levels, using toolbelts to prevent tools from falling, carrying out a pre-use checklist of systems and equipment for working at height, using certified work platforms (scaffolding, ladders, ramps, etc.). • Moving through authorized spaces only. More than 80% of the measures defined and implemented to manage hazards and minimize risks are associated with management, redesign and elimination controls, while the remaining percentage is associated with personal protective equipment, segregation and substitution. Individuals who work in this industry may be exposed to possible contaminants and potential health risks and the Company strives to address these concerns in order to protect all SQM workers. We conduct ongoing risk assessments, which allows us to design measures to ensure that our workers are in good physical and mental health. We have plans for monitoring, controlling and reducing exposure to all of the agents to which our workers may be exposed. Occupational illnesses among contractors are managed through the Risk Prevention Program in our Operations (established by contract), which is aligned with SQM’s Comprehensive Occupational Health and Safety Management Program. Furthermore, we conduct controls to ensure that our contractor companies are notifying their employees of workplace risks and making sure they use personal protective equipment and other safety practices. In regard to SQM worker and contractor exposure to occupational illness and pollutants (the latter under OSHA), at our Salar de Atacama, Carmen Chemical Plant, Nueva Victoria, Coya Sur and Pedro de Valdivia operations we have identified corrosives, hepatotoxins, nephrotoxins, neurotoxins, sensitizing agents, carcinogens, mutagens and reprotoxins. The control measures implemented to prevent occupational illnesses and exposure to different contaminants are carried out jointly with the official agency responsible, the Chilean Safety Association (ACHS) in our case. The agency and SQM coordinate on the environmental assessment of substances to which workers may be exposed, defining groups with similar exposure levels, performing qualitative and quantitative assessments where necessary and implementing surveillance programs where applicable, based on exposure levels found in ACHS reports. We also have prioritized engineering measures such as the introduction of forced extraction hoods in laboratories. At our plants, these substances are handled in open, well-ventilated areas and employees always use the personal protective equipment appropriate to the agent in question. For respiratory protection, we follow the technical guides distributed by the Chilean Public Health Institute and ACHS report recommendations (see above). 8 INDICATORS 163 Product Design for Use-phase Efficiency Indicator 1.- RT-CH-410a.1. Revenue from products designed for use-phase resource efficiency At SQM we have five lines of business and are a global leader in four of them: Specialty Plant Nutrition Iodine and derivatives Lithium and derivatives Potassium Industrial Chemicals We are a key stakeholder in the markets where we sell our products, including lithium and its derivatives, specialty plant nutrients, iodine and its derivatives, potassium and industrial chemicals. For more information, see Chapter 6 section 6.2. Safety & Environmental Stewardship of Chemicals (1) Percentage of products Indicators 1.- RT-CH-410b.1. contain Globally Harmonized System of Classification and Labeling of Chemicals (GHS) Category 1 and 2 Health and Environmental Hazardous Substances, (2) percentage of such products that have undergone a hazard assessment 2.- RT-CH-410b.2. Discussion of strategy to (1) manage chemicals of concern and (2) develop alternatives with less human and/or environmental impact that Given the nature and uses of the products that we sell, we do not have a hazardous substance management procedure for generating alternatives with a lower human and environmental impact. However, we do take steps to maintain up to date information on product risks and hazards and to provide updated communications on hazards through safety data sheets and labeling. The company presents information on hazards in accordance with international standards, usually based on the Globally Harmonized System of Classification and Labeling of Chemicals. All of our products have their own safety data sheet, which includes the ingredients that could impact human health and/or the environment. This document also sets out the conditions for safe product use and disposal. We also monitor regulatory and technical developments to identify substances of great concern based on the criteria of Regulation (EC) 1907/2006. Each raw material used is evaluated in terms of its hazard classification in order to assess the impact on the classification of the final product. The safety data sheet is a hazard assessment communication tool. Our internal customers can request safety data sheets for new products through a web platform created exclusively for this purpose, in order to leave evidence and document the process. Lithium and Iodine The company has a process for updating product artwork and labels that includes labeling information as per the regulatory requirements of destination markets: 8 INDICATORS 164 I. II. III. Product origin, indicated on all labels. Contents are listed voluntarily or as legally required. Safe use instructions are mandatory and based on the regulations applicable to each destination market. IV. Product disposal instructions are included only when legally required. All lithium and iodine products are covered and assessed to ensure compliance with the procedures described above. They are classified as hazardous to human health by the Chilean Superintendency of the Environment (SMA) and have been subject to risk assessment under the REACH regulation (European Union). All of our lithium- and iodine-derived products have their respective safety data sheets, which are regularly updated. In 2022, 12% of our lithium data sheets were updated. In regard to chemical substance analysis, finished iodine and lithium products do not contain Substances of Very High Concern (SVHC) according to REACH. They also do not contain chemical substances classified as extremely or highly hazardous by the WHO, and lithium carbonate is not listed in California Proposal 65, so no specific analysis was conducted under Proposal 65 in 2022. For finished lithium and iodine products, no analysis is conducted of the strategy and methods to develop alternative chemical substances and processes that reduce or avoid the use of substances that may cause concern among consumers, customers, regulatory agencies and others interested in human health or the environment. Some of our iodine products contain the following environmental hazards according to the SMA Chemical Product Classification and Labeling System: acute toxicity category 4, eye irritation category 2, skin irritation category 2, STOT SE category 3, STOT RE 1, aquatic toxicity category 1. Specialty Plant Nutrition, Potassium and Industrial Chemicals SQM’s specialty plant nutrition line is subject to general chemical product oversight and industry regulations applicable to fertilizers. In Europe, fertilizers have been regulated by Regulation 2003/2003 on fertilizers, which was replaced in 2022 by Regulation (EU) 2019/1009. In general, chemical products sold in Europe are subject to Regulation (CE) 1907/2006 governing the registration, evaluation, authorization and restriction of chemical substances and blends and Regulation (CE) 1272/2008 on the classification, labeling and packaging of substances and blends. Furthermore, potassium nitrate and sodium nitrate (as well as other nitrogen compounds) and nitrogen- based fertilizers are governed by Regulation (UE) 2019/1148 on the sale and use of explosive precursors. In the United States, fertilizers are regulated under the laws of each state. At the federal level they are regulated by the OSHA Hazard Communication Standard (HCS) and the Toxic Substances Control Act (TSCA). Potassium nitrate and sodium nitrate are governed by the Chemical Facility Anti-Terrorism Standards (CFATS). Maritime transportation of these products is regulated by the IMDG and IMSBC codes. 8 INDICATORS 165 All of the products are covered and assessed for compliance with the aforementioned procedures and regulations. Some of our products may contain boron (in the form of boric acid) as an impurity or desired element. Boron levels are monitored during production. When levels of impurities or intentional ingredients exceed the limits established in the Globally Harmonized System, the products are classified and labeled as such to communicate the hazard associated with these products. In regard to analyzing the strategy and methods to develop alternative processes and chemical substances that reduce or avoid the use of substances that may be of concern to consumers, customers, regulatory agencies or others interested in human health and the environment, potential contaminants are monitored during production. In addition, annual studies are conducted to evaluate heavy metals. The company has developed prilled products that are less hazardous due to the oxidizing properties of nitrate-based products, which meet the principles of green chemistry and designing safer chemicals. Some of our products contain the following environmental hazards, according to the SMA Chemical Product Classification and Labeling System: reproductive toxicity and eye irritation 2. It is also worth mentioning that the products cataloged as hazardous undergo chemical safety assessments and, in some cases, depending on the product, the assessment is conducted on their components. Products cataloged as non-hazardous are not subject to chemical safety assessments. 8 INDICATORS 166 Genetically modified organisms Indicator 1.- RT-CH-410c.1. Percentage modified organisms (GMOs) of products by revenue that contain genetically The above indicator does not apply to SQM, as we do not make products that contain GMOs. Management of the Legal & Regulatory Environment Indicator 1.- RT-CH-530a.1. Discussion of corporate positions related to government regulations and/or policy proposals that address environmental and social factors affecting the industry This section outlines some of the risks and opportunities present in current legislation, regulations and/or legal processes (hereafter collectively called the “legal and regulatory environment”) related to environmental and/or social factors that could have a considerable financial impact on the Company, as follows (see Appendix 1 for more information): - Environmental laws and regulations could expose us to increased costs, liabilities, complaints and failure to meet current and future production targets. - Current and future labor laws and regulations in Chile could expose us to potential liabilities and costs due to non-compliance. - Outbreaks of infectious diseases or other public health pandemics, such as the recent outbreak of COVID-19 (“coronavirus”), which is still present around the world, have impacted and may further impact markets in which SQM, our customers and our suppliers operate or market and sell products, and this may have a material adverse effect on our business operations, financial position and operational results. - If our interest groups and other stakeholders believe that we are not adequately addressing sustainability and other environmental, social and governance (ESG) concerns, this could have a negative effect on our business. - Changes in laws and other legal provisions regarding water rights may affect our business, financial position and operational results. - Our water supply may be affected by geological changes and/or climate change. - Ratification of the International Labour Organisation’s Convention 169 on Indigenous and Tribal Peoples may impact our development plans. - Quality standards in the markets where we sell our products may also become stricter over time. Operational Safety, Emergency Preparedness & Response Indicator 8 INDICATORS 167 1.- RT-CH-540a.1. Process Safety Incidents Count (PSIC), Process Safety Total Incident Rate (PSTIR), and Process Safety Incident Severity Rate (PSISR) 2.- RT-CH-540a.2. Number of transport incidents. At SQM, we conduct investigations and establish control measures for incidents that occur at our facilities. We also inform the respective authorities in accordance with their specific regulations. To do this, we use an accident investigation procedure to record: Internal reporting of accidents and external reports to authorities. • Responsibility for the investigation process. • • Description of the process, steps of the investigation. • Establishment of corrective measures using the control hierarchy. • Creation of investigative teams depending on the potential of the accident. Every incident—including accidents with or without lost time, material damages and/or operational failures—is recorded and investigated according to the respective procedure. These are presented and discussed at Board meetings and Executive Operations Committee meetings in order to identify lessons learned and improve processes. We have a tool called Zyght to record all types of incidents, findings, dangerous situations and other issues related to occupational health and safety. Process Safety Incidents in 2022 No. of Incidents Total severity score Process Safety Total Incident Rate (PSTIR) Process Safety Incident Severity Rate (PSISR) Note: Calculation factor per 200,000 hours. Transport Incidents 4 4 0.03 0.03 In 2022, 11 transport incidents were registered, mainly related to ground transportation of our products between operations and from our operations to the port of Mejillones. These incidents are outlined below: Description Causes Results / consequences Corrective action taken Driver for a subcontractor, bringing a load to the Port of Mejillones, overturned on Route B-262 Km 5 (port access curve). Material damage to 1.- Reckless driving by an external the truck structure. bus driver. 1.- Dissemination and awareness-raising among drivers about the incident, reinforcing defensive driving techniques, being aware of adverse conditions that can occur along their route. Subcontractor’s bus hit the rear of another company’s truck. 1.- Driver drove across the centerline. 2.- Distracted driving, not paying attention to the road while driving. Material damage to the truck structure. 1.- Dissemination and awareness-raising among drivers about the incident, reinforcing defensive driving techniques, raising awareness of adverse conditions that can occur along their routes, and maintaining self-awareness about distracted driving. 2.- Driver was fired for failing to perform his duties. 8 INDICATORS 168 Subcontractor’s driver, while driving along Route 5 Norte km 1,675, struck a pedestrian on the road. The pedestrian died at the scene as a result of being struck. Driver for a subcontractor, while driving along Roue 5 Norte, was hit on the left side by a bus that had swerved across the centerline. A subcontractor’s driver, while driving down Route B- 385 at Cuesta Domeyko, drove across the centerline and ended up jackknifed beside the shoulder. Subcontractor’s driver, driving along Route B-24 at Cuesta Barriles, was hit in the lower front cabin by the rear bumper of an acid cargo truck, which had veered over the centerline on a curve. 1.- Pedestrian was walking on the roadway. 2.- Lighting was limited. Pedestrian struck (died at the scene). 1.- The entire fleet of drivers was engaged in a reflection and analysis regarding the incident. 2.- Driver involved underwent a psychological assessment before returning to work. 3.- The safety campaign, "Nadie está libre, a todos nos puede pasar” (No one is immune, it can happen to anyone) was implemented. 1.- Bus driver showed reckless driving while driving around the curve, driving into the oncoming traffic lane. 2.- The curve’s geometric configuration: on the western side of the road there is a slope that limits visibility of oncoming traffic. 1.- Overconfident and with a low perception of risk, the driver lost control of the rig’s stability, causing it to go off the pavement and end up jackknifed. 2.- Driver was fatigued, leading to distracted driving. 1.- Unsafe action by third party caused high risk when it veered into oncoming traffic. 2.- The factors involving the other driver that caused the accident are unknown. Minor injury to both drivers/ material damage to the structure of the truck and the bus. 1.- The entire fleet was engaged in a reflection, awareness raising and analysis of the incident. 2.- Defensive driving campaign implemented. 3.-Controls were increased at the Quillagua customs post. Material damage /driver was not injured. 1.- All staff were told about the incident and underwent a review of defensive driving, respecting posted speed limits and other road signs, and the correct use of new–way. 2.- Driver received training in defensive driving and preventing fatigue at the wheel. 3.- Driver received a letter of reprimand. Material damage to the truck structure. 1.- Reflection and safety analysis was carried out in relation to the event. 2.- The safety campaign "En un segundo” (In a second) was implemented. Subcontractor’s driver, while driving on the internal road at Nueva Victoria km 14.8, lost control of his vehicle on a curve, veering off onto the right side of the road. 1.- Loss of control of the rig. 2.- Distracted driving by taking his eyes off the road. 3.- Insufficient promotion of the concept of self-care and defensive driving. Material damage to the rig. Subcontractor’s driver, while driving on Route B-24 towards Coya Sur, lost control of his Batea rig, driving off the road onto the right-hand shoulder and ending up in a jackknife position. After the driver of a subcontractor parked and exited from his rig at Baquedano, the truck moved, crashing into the perimeter fence. 1.- Loss of control of the rig. 2.- Use of a cell phone while driving (video call). Material damage to the rig. 1.- Driver was not aware of the risk of parking the rig without ensuring the brake was on. 2.- Worker’s performance was unreliable, as he had done the same thing every day when stopping the rig. 3.- Unsatisfactory identification and assessment of exposure to loss upon entering the town of Baquedano (an area full of high tonnage trucks). 4.- The driver lacked control and awareness of defensive driving and failed to verify the parking position. No material damage to the rig/ no injury to persons. Subcontractor’s driver, when driving to pick up the second load of his shift inside the Nueva Victoria site, drove around a curve and tilted his 1.- Distraction (not paying attention to the task of driving). 2.- Overconfidence. 3.- Rigs with problems are not monitored comprehensively and DSS No material damage to the rig/ no injury to persons. 1.- Implementation and monitoring of camera alerts for misalignment. 2.- Driver was trained in defensive driving by Xplork, and underwent risk management onboarding through SQM Aprende. 3.- BSR training and evaluation and reinforcement of safety standards implemented. 4.- 21-day sanction for non-compliance given, as per the non-compliance matrix. 5.- The entire fleet was engaged in awareness raising, analysis and reflection on the incident. 1.- Dissemination and analysis of the incident. 2.- Driver detained during the investigation. 3.- Safety campaign "No Utilizar Celular al Conducir” (Don’t use your cell phone while driving). 4.- Driver involved in the incident was fired. 5.- Daily control of all individuals who deviate from the Guardian platform (cell phone use). 1.- Dissemination and analysis of the incident. 2.- Planning and designation of places for parking trucks in Baquedano locality. 3.- Training talk on identifying risks and hazards in the workplace (shift change). 4.- Inclusion within the risk inventory of entry into communities, including risks present and control measures. 5.- Repair of damage in the community and improvements to the surroundings. 6.- Administrative action taken with the driver involved. 7.- An informative letter with an apology and corresponding commitment to the community of Baquedano was sent to the mayor. 1.- Dissemination and awareness-raising among the entire fleet of drivers regarding the incident. 2.- Reinforcement and reassessment of procedures for the interior road at Nueva Victoria. 3.- Dissemination and evaluation of EPR-02 external control standard for distraction, focused on 8 INDICATORS 169 rig to the right-hand side, veering off the road. (Guardian) repairs not followed up on. Subcontractor’s driver, while driving a tanker loaded with lithium brine, lost control of the vehicle at km 25 of Route B385 and overturned. 1.- Incorrect decision making. 2.- Did not keep his eyes on the road. 3.- Failed attempt to save time. 4.- Employee felt in a hurry. Material damage to the rig / driver injury consisted of broken left humerus and a cut on the head. the risks of applying these standards. 4.- Driver signed up for the auto club defensive driving program. 5.- Maintenance and repair of DSS equipment in poor condition. 1.- The entire fleet of drivers was engaged in a reflection and analysis regarding the incident. 2.- Driver underwent psychological assessment in relation to the event. 3.- Awareness raised about the consequences of distracted driving. 4.- Methodology developed to ensure drivers leave the base with documentation reviewed by a supervisor; personalized document control by supervisors will be introduced. 5.- Ongoing Nazar-SQM review of alert management platforms. 6.- Implementation of driver monitors at the Uribe base (accompaniment in cab/observation of behavior). 7.- Dissemination and evaluation of fatigue and sleepiness procedure. By implementing and certifying in ISO 39001:2012, the international standard for Road Traffic Safety Management, we are striving to ensure that ground transportation of our products is safe, and that we have minimized the risk of injury and death due to traffic accidents, for both our workers and the community. Production By Reportable Segment Indicator 1.- RT-CH-000.A Details of our production during 2022 can be found in section 6.2. 8 INDICATORS 170 9. ESSENTIAL OR RELEVANT FACTS Below is a summary of the essential or relevant facts reported by the Company to the regulatory entities, the respective stock exchanges, and corporate website, during 2022: On March 23, 2022, the Company reported the agreement to recommend to the ordinary shareholders' meeting of the Company - to be held on April 26, 2022 - the distribution and payment of dividends, in accordance with the Dividend Policy reported as an essential event on November 17, 2021 (the “Policy”), for an amount of US$0.09691 per share to complete the amount of US$2.04964 for the final dividend. Said definitive dividend already considers the first interim dividend of US$0.23797 per share, the second interim dividend of US$0.31439 per share and the eventual dividend of US$1.40037 per share, which were paid during the year 2021. Likewise, it was reported that the final dividend balance for the 2021 business year will be paid in its equivalent in pesos, the national currency in accordance with the observed dollar value published in the Official Gazette on April 26, 2022, in favor of those shareholders of the Company who are registered in the respective Registry on the fifth business day prior to the one on which the same will be paid. On April 25, 2022, the Company announced the filing with the Securities and Exchange Commission (“SEC”) of the 20F Annual Report for the fiscal year ended December 31, 2021. On the same date, the Company issued the summaries of technical reports for the following properties: Salar de Atacama, the Mt. Holland Lithium Project, Pampa Orcoma and Nueva Victoria (the “Reports”). These reports were accompanied by the respective consents from the qualified persons responsible for their validations. On April 26, 2022, the Company reported the holding of the 47th ordinary general meeting of shareholders of the Company, in which the following matters were agreed upon, among others: (a) Approval of the Company's balance sheet, memory, financial statements and external auditors' report for the business year ended December 31, 2021; (b) Appointment of PricewaterhouseCoopers Consultores - Auditores SpA, as external auditors of the Company for the business year between January 1 and December 31, 2022; (c) Distribution of a final dividend under the terms recommended by the Company's board of directors (the “Board of Directors”), which were communicated as an essential fact on March 23, 2022; (d) Election of the Board of Directors, which was made up of Mrs. Dang Qi and Gina Ocqueteau Tacchini and Mr. Antonio Gil Nievas, Gonzalo Guerrero Yamamoto, Patricio Comtesse Fica, Ashely Luke Ozols, Hernán Büchi Buc and Antonio Schneider Chaigneau, with Mrs. Ocqueteau and Mr. Gil the quality of independent; and (e) Approval of the remuneration structure of the directors of the Company, members of its different committees, and their expenses. Likewise, in an extraordinary session on the same date, the Board of Directors agreed on the appointment of Mr. Gonzalo Guerrero Yamamoto as Chairman of the Board and Mr. Patricio Comtesse Fica as Vice President of the Board. In addition, it was reported that the committees of the Board of Directors were integrated as follows: (a) Committee of Directors: Gina Ocqueteau Tacchini, Antonio Gil Nievas and Ashely Luke Ozols; (b) Corporate Governance Committee: Patricio Comtesse Fica, Hernán Büchi Buc and Antonio Schneider Chaigneau; 9 ESSENTIAL OR RELEVANT FACTS 171 (c) Safety, Health, and Environment Committee: Dang Qi, Patricio Comtesse Fica and Gonzalo Guerrero Yamamoto. On May 18, 2022, the Company reported that the Board of Directors agreed to pay an interim dividend equivalent to US$2.78716 per share, charged to the profits for the year 2022. Said amount will be paid in its equivalent in pesos, the national currency, according to the value of the Observed Dollar published in the Official Gazette on June 6, 2022. On August 17, 2022, the Company reported that the Board of Directors agreed to pay an interim dividend equivalent to US$1.84914 per share, charged to the Company's 2022 profits. Said amount will be paid in its equivalent in pesos, the national currency, according to the value of the Observed Dollar that appears published in the Official Gazette on October 3, 2022. On September 13, 2022, and after 25 years of lithium production in Chile, the Company reported on the announcement of the Salar Futuro project that seeks, through advanced and disruptive technologies, to increase performance and use of seawater, make extraordinary contributions, both to the hydrological environment of the Salar de Atacama basin, and to the communities and native peoples of the area, in order to continue offering high-quality lithium products in a responsible manner, with low production costs and, according to our estimation, the smallest environmental footprint in the world. During the first half of this annual cycle, SQM contributed approximately US$2,314 million to the Treasury, including payments to Corfo for rental income, contributions to communities and regional development, and taxes on profits. This positive trend at SQM is the result of a fully integrated commercial activity from Chile to the end customer, which allows it to deliver the best high-quality, value-added product directly to customers, keeping most of the products in the country. Chilean lithium benefits. Working together and constructively will significantly enhance the economic and social value of the lithium operation in the Salar de Atacama, at a local, regional and national level. The Salar Futuro Project will become Chile's main public-private cooperation project, generating an example of long-term sustainable development. On October 13, 2022, the Company announced a long-term agreement with GE Healthcare's Pharmaceutical Diagnostics Business to secure the supply of iodine, a key ingredient for contrast media products used in X-ray procedures. and computed tomography (CT), worldwide. The agreement will see SQM increase the supply of iodine raw material year on year and is part of GE Healthcare's commitment and investment plan to enable the annual production of an additional 30 million doses for patients requiring iodinated contrast media per year 2025. On November 21, 2022, the Company reported that the Board of Directors agreed to pay an interim dividend equivalent to US$3.08056 per share, charged to the Company's 2022 profits. Said amount will be paid in its equivalent in pesos, national currency, according to the value of the Observed Dollar that appears published in the Official Gazette on December 12, 2022. SQM did not identify material effects that the Essential Facts detailed above could have on the business, the value or offer of its shares. 9 ESSENTIAL OR RELEVANT FACTS 172 10. COMMENTS FROM SHAREHOLDERS AND THE DIRECTORS' COMMITTEE Pursuant to the provisions of article 74, paragraph 3, of Law No. 18,046, there have been no comments or proposals related to the progress of the Company's business made by shareholders or by the SQM Directors' Committee. 11. FINANCIAL REPORTS The Company's consolidated financial statements as of December 31, 2022 are available on the website of the Chilean Financial Market Commission (Comisión para el Mercado Financiero or CMF) at the following link: https://www.cmfchile.cl/institucional/inc/inf_financiera/ifrs/safec_ifrs_verarchivo.php?auth=&send=& rut=93007000&mm=12&aa=2022&archivo=pdf_93007000_202212_c_20230302010504.pdf&desc_ar chivo=Estados%20financieros%20(PDF)&tipo_archivo=PDF and on the Company’s website: https://s25.q4cdn.com/757756353/files/doc_financials/2022/q4/Financial- Statements_4Q2022_English.pdf 11 FINANCIAL STATEMENTS 173 ANNEX ANNEX 1. RISK FACTORS Risk Factors Our operations are subject to certain risk factors that may affect SQM’s business, financial condition, cash flows, or results of operations. In addition to other information contained in this Annual Report, you should carefully consider the risks described below. These risks are not the only ones we face. Additional risks not currently known to us or that are known but that we currently believe are not significant may also affect our business operations. Our business, financial condition, cash flows or results of operations could be materially affected by any of these risks. Risks Related to our Business Our inability to extend or renew the mineral exploitation rights relating to the Salar de Atacama concession, upon which our business is substantially dependent, beyond their current expiration date in December 2030 could have a material adverse effect on our business, financial condition and results of operations. Our subsidiary SQM Salar S.A. (“SQM Salar”), as leaseholder, holds exclusive and temporary rights to exploit mineral resources in the Salar de Atacama in northern Chile. These rights are owned by Corfo, a Chilean government entity, and leased to SQM Salar pursuant to (i) a 1993 lease agreement over mining exploitation concessions between SQM Salar and Corfo, as amended from time to time, and (ii) the Salar de Atacama project agreement between Corfo and SQM Salar, as amended from time to time (collectively, the “Corfo Agreements”). The Corfo Agreements provide for SQM Salar to (i) make quarterly lease payments to Corfo based on product sales from the leased mining properties and annual contributions to research and development, to local communities, to the Antofagasta Regional Government and to the municipalities of San Pedro de Atacama, María Elena and Antofagasta, (ii) maintain Corfo’s rights over the mining exploitation concessions and (iii) make annual payments to the Chilean government for such concession rights. The Corfo Agreements expire on December 31, 2030. Our business is substantially dependent on the exploitation rights under the Corfo Agreements, since all of our products originating from the Salar de Atacama are derived from our extraction operations under the Corfo Agreements. For the year ended December 31, 2022, revenues related to products originating from the Salar de Atacama represented 80% of our consolidated revenues, consisting of revenues from our potassium business line and our lithium and derivatives business line for the period. As of December 31, 2022, only 8 years remain on the term of the Corfo Agreements and we had extracted approximately 38% of the total permitted accumulated extraction and sales limit of lithium under the lithium extraction and sales limits. Although we expect to begin the process of discussing the extension or renewal of the mineral exploitation rights in the Salar de Atacama under the Corfo Agreements with Corfo well in advance of the December 2030 expiration date, we cannot assure you that we will successfully reach an agreement with Corfo to extend or renew our mineral exploitation rights beyond 2030. Any negotiation with Corfo for an extension or renewal could involve renegotiation of any or all of the terms and conditions of the Corfo Agreements, including, among other things, the lithium and potassium extraction and sales limits, the lease payment rates and calculations, or other payments to Corfo. In the event that we are not able to extend or renew the Corfo Agreements beyond the current expiration date in 2030, we would be unable to continue extraction of lithium and potassium under the Corfo ANNEX 174 Agreements, which could have a material adverse effect on our business, financial condition and results of operations. Volatility of world lithium, fertilizer and other chemical prices and changes in production capacities could affect our business, financial condition and results of operations. The prices of our products are determined principally by world prices, which, in some cases, have been subject to substantial volatility in recent years. World lithium, fertilizer and other chemical prices constantly vary depending upon the relationship between supply and demand at any given time. Supply and demand dynamics for our products are tied to a certain extent to global economic cycles and have been impacted by circumstances related to such cycles. Furthermore, the supply of lithium, certain fertilizers, or other chemical products, including certain products that we provide, varies principally depending on the production of the major producers, (including us) and their respective business strategies. We expect that prices for the products we manufacture will continue to be influenced, among other things, by worldwide supply and demand and the business strategies of major producers. Some of the major producers (including us) have increased or decreased production and have the ability to increase or decrease production. As a result of the above, the prices of our products may be subject to substantial volatility. For example, average lithium prices increased from US$9,300 per metric ton in 2021 to an average of $52,000 per metric ton in 2022. High volatility or a substantial decline in the prices or sales volumes of one or more of our products could have a material adverse effect on our business, financial condition and results of operations. Our sales could be impacted by global shipping constraints. We sell our products in more than 110 countries in the world. Our products are shipped in containers or break bulk format from the port terminals in Antofagasta, Tocopilla, Mejillones and Iquique in Chile. Current challenges in the global shipping industry have led to congestion in ports, a shortage in containers, and a lack of space on ships. Because of this situation, we face a risk of potential supply chain disruptions that may adversely affect our operations and ability to deliver our products to our customers. Depending on the terms of shipments to customers, the risk of loss related to these shipping issues could fall on us. Additionally, our revenues and collections may also be adversely affected by significant increases in the cost of transportation, as a result of increases in fuel or labor costs, higher demand for logistics services, or otherwise, and transportation delays that could have a negative impact on our sales agreements and customer relationships. Our sales to emerging markets and expansion strategy expose us to risks related to economic conditions and trends in those countries. We sell our products in more than 110 countries around the world. In 2022, approximately 67% of our sales were made in emerging market countries: 58% in Asia and Oceania (excluding Australia, Japan, New Zealand, South Korea and Singapore), 3% in Latin America (excluding Chile); 3% in Africa and the Middle East (excluding Israel); and 3% in Chile. In Note 23.1 to our consolidated financial statements, we reported revenues from Chile, Latin America and the Caribbean and Asia and others of US$8.9 billion. We expect to expand our sales in these and other emerging markets in the future. In addition, we may carry out acquisitions or joint ventures in jurisdictions in which we currently do not operate, relating to any of our businesses or to new businesses in which we believe we may have sustainable competitive advantages. The results of our operations and our prospects in other countries in which we establish operations will depend, in part, on the general level of political stability, economic activity and policies in those countries as well as the duration of the COVID-19 or other pandemics. Future developments in the political systems or economies of these countries or the implementation of ANNEX 175 future governmental policies in those countries, including the imposition of withholding and other taxes, restrictions on the payment of dividends or repatriation of capital, the imposition of import duties or other restrictions, the imposition of new environmental regulations or price controls or changes in relevant laws or regulations, could have a material adverse effect on our business, financial condition and results of operations in those countries. Our inventory levels may vary for economic or operational reasons. In general, economic conditions or operational factors can affect our inventory levels. Higher inventories carry a financial risk due to increased need for cash to fund working capital and could imply an increased risk of loss of product. At the same time, lower levels of inventory can hinder the distribution network and process, thus impacting sales volumes. There can be no assurance that inventory levels will remain stable. These factors could have a material adverse effect on our business, financial condition and results of operations. New production of iodine, potassium nitrate or lithium from current or new competitors in the markets in which we operate could adversely affect prices. In recent years, new and existing competitors have increased the supply of iodine, potassium nitrate and lithium, which has affected prices for those products. Further production increases could negatively impact prices. There is limited information on the status of new iodine, potassium nitrate or lithium production capacity expansion projects being developed by current and potential competitors and, as such, we cannot make accurate projections regarding the capacities of possible new entrants into the market and the dates on which they could become operational. If these potential projects are completed in the short term, they could adversely affect market prices and our market share, which, in turn, could have a material adverse effect on our business, financial condition and results of operations. We have a capital expenditure program that is subject to significant risks and uncertainties. Our business is capital intensive. Specifically, the exploration and exploitation of reserves, mining and processing costs, the maintenance of machinery and equipment and compliance with applicable laws and regulations require substantial capital expenditures. We must continue to invest capital to maintain or to increase our exploitation levels and the amount of finished products we produce. For example, we have a US$3.4 billion investment plan for the years 2023-2025. The plan will allow us to expand our operations of lithium, iodine and nitrate by accessing natural resources both in the Salar de Atacama and caliche ore deposits in Chile, through the 50,0000 metric ton Mt. Holland lithium hydroxide project in Western Australia (a joint venture that we are developing with our partner Wesfarmers) and the development of a 20,000 metric ton lithium hydroxide plant in China which will be fed with lithium sulfate sourced from the Salar de Atacama. The plan also aims to increase our mining capacity while protecting the environment, reduce operational costs and increase our annual production capacity of nitrates and iodine to meet expected growth in those markets. Mining industry development projects typically require a number of years and significant expenditures before production can begin. Such projects could experience unexpected problems and delays during development, construction and start-up. Our decision to develop a project typically is based on the results of feasibility studies, which estimate the anticipated economic returns of a project. The actual project profitability or economic feasibility may differ from such estimates as a result of any of the following factors, among others: • changes in tonnage, grades and metallurgical characteristics of ore or other raw materials to be mined and processed; • estimated future prices of the relevant products; ANNEX 176 • • changes in customer demand; higher construction and infrastructure costs; the quality of the data on which engineering assumptions were made; • higher production costs; adverse geotechnical conditions; • • • • availability of adequate labor force; availability and cost of water and energy; availability and cost of transportation; fluctuations in inflation and currency exchange rates; availability and terms of financing; and potential delays relating to social and community issues. In addition, we require environmental permits for our new projects. Obtaining permits in certain cases may cause significant delays in the execution and implementation of new projects and, consequently, may require us to reassess the related risks and economic incentives. This may require modifying our operations to incorporate the use of seawater and updating our mining equipment and operational centers. We cannot assure you that we will be able to maintain our production levels or generate sufficient cash flow or that we will have access to sufficient investments, loans or other financing alternatives, to continue our activities at or above present levels, or that we will be able to implement our projects or receive the necessary permits required for them in time. Any or all of these factors may have a material adverse effect on our business, financial condition and results of operations. High raw materials and energy prices could increase our production costs and cost of sales, and energy may become unavailable at any price. We rely on certain raw materials and various energy sources (diesel, electricity, liquefied natural gas, fuel oil and others) to manufacture our products. Purchases of energy and raw materials we do not produce constitute an important part of our cost of sales (excluding the payments to Corfo) was approximately 22% in 2022. In addition, we may not be able to obtain energy at any price if supplies are curtailed or otherwise become unavailable. To the extent we are unable to pass on increases in the prices of energy and raw materials to our customers or we are unable to obtain energy, our business, financial condition and results of operations could be materially adversely affected. Our reserve estimates could be subject to significant changes, which may have a material adverse effect on our business, financial condition and results of operations. Our caliche ore mining reserve estimates and our Salar de Atacama brine mining reserve estimates are prepared by qualified persons and this information is presented in our technical report summaries prepared and filed as required by subpart 1300 of Regulation S-K. Estimation methods involve numerous uncertainties as to the quantity and quality of the reserves, and reserve estimates could change upwards or downwards. A downward change in our estimates and/or quality of our reserves could affect future volumes and costs of production and therefore have a material adverse effect on our business, financial condition and results of operations. Chemical and physical properties of our products could adversely affect their commercialization. Since our products are derived from natural resources, they contain inorganic impurities that may not meet certain customer or government standards. As a result, we may not be able to sell our products if we cannot meet such requirements. In addition, our cost of production may increase in order to meet such standards. Failure to meet such standards could materially adversely affect our business, financial condition and results of operations if we are unable to sell our products in one or more markets or to important customers in such markets. ANNEX 177 Changes in technology or other developments could result in preferences for substitute products. Our products, particularly iodine, lithium and their derivatives, are preferred raw materials for certain industrial applications, such as rechargeable batteries and liquid-crystal displays (LCDs). Changes in technology, the development of substitute products or other developments could adversely affect demand for these and other products which we produce. In addition, other alternatives to our products may become more economically attractive as global commodity prices shift. Any of these events could have a material adverse effect on our business, financial condition and results of operations. We are exposed to labor strikes and labor liabilities that could impact our production levels and costs. We are exposed to labor strikes and labor liabilities that could impact our production levels and costs. Over 93% of our employees are employed in Chile, of which approximately 77% were represented by 22 labor unions as of December 31, 2022. As of December 31, 2022, fifteen collective bargaining agreements had been renegotiated in advance and the remaining seven should be negotiated during 2023. We are exposed to labor strikes and illegal work stoppages by both our own employees and our independent contractors’ employees that could impact our production levels in both our own plants and our independent contractors’ plants. If a strike or illegal work stoppage occurs and continues for a sustained period of time, we could be faced with increased costs and even disruption in our product flow that could have a material adverse effect on our business, financial condition and results of operations. We are and might be subject to new and upcoming labor laws and regulations in Chile and may be exposed to liabilities and potential costs for non-compliance. We are subject to recently enacted and might be subject to new local labor laws and regulations that govern, among other things, the relationship between us and our employees and will be subject to new labor bills currently under discussion in the Chilean Congress, mainly as a result of the impact of the global COVID-19 pandemic as well as to the economic and political volatility and civil unrest in Chile beginning in October and November 2019. There have been changes and proposed changes to various labor laws which include, but are not limited to, modifications related to teleworking, inclusion of workers with disabilities, minimum wage, unemployment insurance benefits, employee and employer relationships, pensions, profit sharing, regular work hours and other matters related to COVID-19. Additionally, the Chilean Congress is currently discussing a bill, Bulletin No. 11179-13, which proposed a reduction of the weekly working schedule from 45 to 40 hours. The bill was approved by the Chamber of Representatives (Camara de Diputados) and is currently being discussed by the Senate. Reducing the working schedule may imply an increase in the labor cost of both direct employees and outsourced personnel. Any changes to regulations to which we are subject could have a material adverse effect on our business, financial condition and results of operations. Lawsuits and arbitrations could adversely impact us. We are party to a range of lawsuits and arbitrations involving different matters as described in Note 21.1 to our Consolidated Financial Statements. Although we intend to defend our positions vigorously, our defense of these actions may not be successful and responding to such lawsuits and arbitrations diverts our management’s attention from day-to-day operations. Adverse judgments or settlements in these lawsuits may have a material adverse effect on our business, financial condition and results of operations. In addition, our strategy of being a world leader includes entering into commercial and production alliances, joint ventures and acquisitions to improve our global competitive position. As these operations increase in complexity and are carried out in different jurisdictions, we may be subject to legal proceedings that, if settled against us, could have a material adverse effect on our business, financial condition and results of operations. ANNEX 178 We have operations in multiple jurisdictions with differing regulatory, tax and other regimes. We operate in multiple jurisdictions with complex regulatory environments that are subject to different interpretations by companies and respective governmental authorities. These jurisdictions may have different tax codes, environmental regulations, labor codes and legal framework, which adds complexity to our compliance with these regulations. Any failure to comply with such regulations could have a material adverse effect on our business, financial condition and results of operations. Environmental laws and regulations could expose us to higher costs, liabilities, claims and failure to meet current and future production targets. Our operations in Chile are subject to national and local regulations relating to environmental protection. In accordance with such regulations, we are required to conduct environmental impact studies or statements before we conduct any new projects or activities or significant modifications of existing projects that could impact the environment or the health of people in the surrounding areas. We are also required to obtain an environmental license for those projects and activities. The Chilean Environmental Assessment Service (Servicio de Evaluación Ambiental) or “SEA” evaluates environmental impact studies and statements submitted for its approval. The public, government agencies or local authorities may review and challenge projects that may adversely affect the environment, either before these projects are executed or once they are operating, if they fail to comply with applicable regulations. In order to ensure compliance with environmental regulations, Chilean authorities may impose fines up to approximately US$9 million per infraction, revoke environmental permits or temporarily or permanently close facilities, among other enforcement measures. Chilean environmental regulations have become increasingly stringent in recent years, both with respect to the approval of new projects and in connection with the implementation and development of projects already approved, and we believe that this trend is likely to continue. Given public interest in environmental enforcement matters, these regulations or their application may also be subject to political considerations that are beyond our control. We regularly monitor the impact of our operations on the environment and on the health of people in the surrounding areas and have, from time to time, made modifications to our facilities to minimize any adverse impact. Future developments in the creation or implementation of environmental requirements or their interpretation could result in substantially increased capital, operation or compliance costs or otherwise adversely affect our business, financial condition and results of operations. The success of our current investments at the Salar de Atacama and Nueva Victoria is dependent on the behavior of the ecosystem variables being monitored over time. If the behavior of these variables in future years does not meet environmental requirements, our operation may be subject to important restrictions by the authorities on the maximum allowable amounts of brine and/or water extraction. For example, on December 13, 2017, the Environmental Court of Antofagasta ordered a temporary and partial closure of certain water extraction wells located in the Salar de Llamara. In October 2018, the Environmental Court of Antofagasta accepted our claim, and dismissed the restrictions without prejudice. It is possible that third parties could seek to reinstate these restrictions in the future. On December 26, 2019, the same Court ruled that the environmental compliance plan presented by SQM Salar S.A. with respect to the Salar de Atacama and approved by the Chilean Environmental Enforcement Authority (Superintendencia del Medio Ambiente) or “SMA” in January 2019, did not comply with certain completeness and efficiency requirements of the Chilean environmental legislation. In September 2021, SQM Salar S.A. proposed to the SMA a new environmental compliance plan, which was approved by the SMA and it’s currently subject to review by the Environmental Court of Antofagasta after a claim was file by an indigenous association. We believe that the new proposed environmental ANNEX 179 compliance plan, safeguards the protection of the environment and is evaluating all courses of action available under applicable law with respect to this ruling. Our future development depends on our ability to sustain future production levels, which requires additional investments and the submission of the corresponding environmental impact studies or statements. If we fail to obtain approval or required environmental licenses, our ability to maintain production at specified levels will be seriously impaired, thus having a material adverse effect on our business, financial condition and results of operations. In addition, our worldwide operations are subject to international and local environmental regulations. Since environmental laws and regulations in the different jurisdictions in which we operate may change, we cannot guarantee that future environmental laws, or changes to existing environmental laws, will not materially adversely impact our business, financial condition and results of operations. A significant percentage of our shares are held by two principal shareholder groups who may have interests that are different from that of other shareholders and of each other. Any change in such principal shareholder groups may result in a change of control of the Company or of its Board of Directors or its management, which may have a material adverse effect on our business, financial condition and results of operations. As of December 31, 2022, two principal shareholder groups held in the aggregate 47.92% of our total outstanding shares, including 94.19% of our Series A common shares, and have the power to elect six of our eight directors. The interests of the two principal shareholder groups may in some cases differ from those of other shareholders and of each other. As of December 31, 2022, one principal shareholder group is Sociedad de Inversiones Pampa Calichera S.A. and its related companies, Inversiones Global Mining Chile Limitada and Potasios de Chile S.A. (together, the “Pampa Group”), which owned approximately 25.76% of the total outstanding shares of SQM, and another principal shareholder is Tianqi Lithium Corporation (“Tianqi”), which directly and indirectly owned approximately 22.16% of the total outstanding shares of SQM. The divestiture by the Pampa Group or Tianqi, or potential changes in the circumstances that have led to the determination of the CMF that there is currently no controlling shareholder of the Company, or a combination thereof, may have a material adverse effect on our business, financial condition and results of operations. Tianqi is a significant shareholder and a competitor of the Company, which could result in risks to free competition. Tianqi is a competitor in the lithium business, and as a result of the number of SQM shares that it owns, it has the right to choose up to three Board members. Under Chilean law, we are restricted in our ability to decline to provide information about us, which may include competitively sensitive information, to a director of our company. On August 27, 2018, Tianqi and the Chilean antitrust regulator, the Chilean National Economic Prosecutor’s Office (Fiscalía Nacional Económica), or FNE, entered into an extrajudicial agreement, under which certain restrictive measures were implemented in order to (i) maintain the competitive conditions of the lithium market, (ii) mitigate the risks described in the agreement and (iii) limit Tianqi’s access to certain information of the Company and its subsidiaries, which is defined as “sensitive information” under the agreement. During the approval process of the extrajudicial agreement before the FNE, we expressed our concerns regarding the measures contained in the extrajudicial agreement since, in the Company’s opinion, the measures (i) could not effectively resolve the risks that Tianqi and the FNE have sought to mitigate, (ii) are not sufficient to avoid access to our “sensitive information” that, in the possession of a competitor, ANNEX 180 could harm us and the proper functioning of the market and (iii) could contradict the Chilean Corporations Act. The presence of a shareholder which is at the same time a competitor of ours and the right of this competitor to choose Board members could generate risks to free competition and/or increase the risks of an investigation of free competition against us, whether in Chile or in other countries, all of which could have a material adverse effect on our business, financial condition and results of operations. Our information technology systems may be vulnerable to disruption which could place our systems at risk from data loss, operational failure, or compromise of confidential information. We rely on various computer and information technology systems, and on third party developers and contractors, in connection with our operations, including two networks that link our principal subsidiaries to our operating and administrative facilities in Chile and other parts of the world and ERP software systems, which are used mainly for accounting, monitoring of supplies and inventories, billing, quality control, research activities, and production process and maintenance control. In addition, we use cloud technologies, which allows us to support new business processes and respond quickly and at low cost to changing conditions in our business and of the markets. Our information technology systems are susceptible to disruption, damage or failure from a variety of sources, including errors by employees or contractors, computer viruses, cyber-attacks, misappropriation of data by outside parties, and various other threats. We have taken measures to identify and mitigate these risks with the object of reducing operational risk and improving security and operational efficiency, which also includes modernization of existing information technology infrastructure and communications systems. However, we cannot guarantee that due to the increasing sophistication of cyber-attacks our systems will not be compromised and because we do not maintain specialized cybersecurity insurance, our insurance coverage for protection against cybersecurity risk may not be sufficient. Cybersecurity breaches could result in losses of assets or production, operational delays, equipment failure, inaccurate recordkeeping, or disclosure of confidential information, any of which could result in business interruption, reputational damage, lost revenue, litigation, penalties or additional expenses and could have a material adverse effect on our business, financial condition and results of operations. International trade tensions could have a negative effect on our financial performance. Economic conditions in China, an important market for the Company, are sensitive to global economic conditions. The global financial markets have experienced significant disruptions in the past, including the recent international trade disputes and tariff actions announced by the United States, China and certain other countries. The U.S. government has imposed significant tariffs on Chinese goods, and Chinese government has, in turn, imposed tariffs on certain goods manufactured in the United States. There is no assurance that the list of goods impacted by additional tariffs will not be expanded or the tariffs will not be increased materially. We are unable to predict how China or U.S. government policy, in particular, the outbreak of a trade war between China and the United States and additional tariffs on bilateral imports, may continue to impact global economic conditions. If the list of goods is further expanded or the tariff is further increased, global economic conditions of both countries could be impacted, and growth in demand for lithium or other commodities could decrease, which may have a material adverse effect on our business, financial condition and results of operations. Heightened tensions in international relations with China could result in political and economic measures against Chinese-owned companies, which may adversely impact our business, financial condition, and results of operations. As of December 31, 2022, one of our largest shareholders is Tianqi, a Chinese company with a 22.16% ownership interest and board representation. Recently there have been heightened tensions in international relations between the United States and Europe, on the one hand, and China. International ANNEX 181 trade disputes and tariff actions announced by the United States, China and certain other countries and other trade restrictions] have affected both diplomatic and economic ties among countries. This environment could result in political and economic measures against Chinese-owned companies. Any further deterioration in the relationship between China, the United States and certain other countries may limit our ability to invest and develop projects in certain countries and adversely impact our business, financial condition, and results of operations. Outbreaks of communicable infections or diseases, or other public health pandemics, such as the outbreak of COVID-19 impacted and may further impact the markets in which we, our customers and our suppliers operate or market and sell products and could have a material adverse effect on our operations business, financial condition and results of operations. Disease outbreaks and other public health conditions, such as the global outbreak of COVID-19, could have a significant negative impact on our revenues, profitability and business. During 2020 and 2021, the Chilean government imposed several measures that affected our operations, including mandatory quarantines for people who have been in contact with infected people, restrictions on the number of people that could be together, and lockdowns on specific communities that suffered higher rates of infection or death, among others. As a precaution, our management voluntarily implemented several additional measures to help reduce the speed at which COVID-19 spread in our company, including measures to mitigate the spread in the workplace, significant reductions in employee travel and a mandatory quarantine for people who have arrived from high-risk destinations. These measures were made in consultation with governmental and international health organization guidelines. It is difficult to predict the potential impact of another disease outbreak or public health condition on international financial markets and the potential impact if businesses, workers, customers and others. If our stakeholders and other constituencies believe we fail to appropriately address sustainability and other environmental, social and governance (ESG) concerns it may adversely affect our business. In October 2020, we announced our sustainable development plan, which includes voluntarily expanding our monitoring systems, promoting better and more profound conversations with neighboring communities and becoming carbon neutral and reducing water by 65% and brine extraction by 50% of our authorized limits. We also announced a goal of obtaining international certifications and participating in international sustainability indices which we consider essential for a sustainable future. Since our sustainable development plan was announced, we have participated in voluntary qualifications, such as Ecovadis, international certifications, such as Responsible Conduct from the Association of Chemical Industries of Chile, Protect&Sustain from the International Fertilizer Association, ISO 14001, ISO 45001 and ISO 50001, and the Standard IRMA Certification Audit, to promote responsible mining. In 2021, the Port of Tocopilla was certified for Responsible Conduct, obtaining level 2 certification. Likewise, during 2022, the Nueva Victoria site was recertified, obtaining level 1 certification. The Protect&Sustain certification applies to the operations of Coya Sur, Salar de Atacama, Antofagasta, Santiago and the Port of Tocopilla. During 2022, the external IRMA on-site certification audit (phase 2) began in the Salar de Atacama operation, and we expect to receive the final results during 2023. Regarding the ISO management systems, the Port of Tocopilla was certified in January 2022 in ISO 14001. We completed phase 2 of ISO 14001 and 45001 certification process in the Salar de Atacama and the Carmen chemical plant, and continued with the implementation process of ISO 50001 in the Salar de Atacama and Nueva Victoria to support decarbonization goals associated with energy management systems. ANNEX 182 During 2022, we participated in the Dow Jones Sustainability Indices (DJSI) assessment and were accepted into the MILA and Chile indices for the third consecutive year and were included in the Sustainability Yearbook 2023. We evaluated ourselves in Carbon Disclosure Project (CDP) where we received a category B rating, which is in the management band, higher than the South American region average (category C) and higher than the Chemicals sector average (category B-). While we are dedicated to our efforts related to sustainability, if we fail to address appropriately all relevant stakeholders’ concerns in connection with ESG criteria, we may face opposition, which could negatively affect our reputation, delay operations, or lead to litigation threats or actions. If we do not maintain our reputation with key stakeholders and constituencies and effectively manage these sensitive issues, they could adversely affect our business, results of operations, and financial condition. Climate change and a global transition to a low carbon economy can create physical risks and other risks that could adversely affect our business and operations and adverse weather conditions or significant changes in weather patterns could have a material adverse impact on our results of operations. The impact of climate change and climate change-driven responses, such as a global transition to a low carbon economy on our operations and our customers’ operations, remains uncertain, but the regulatory, market-risks associated with climate change as well as the physical effects of climate change could have an adverse effect on us and our customers as experts believe that climate change may be associated with more extreme weather conditions These effects could include, but may not be limited to, changes in regional weather patterns, including drought and rainfall levels, water availability, sea levels, storm patterns and intensities and temperature levels, including increased volatility in seasonal temperatures via excessively hot or cold temperatures. These extreme weather conditions could vary by geographic location. Climate-derived threats include, among others, changes in regional weather patterns, including changes in precipitation and evaporation parameters that, on the one hand, intensify drought phenomena, affecting the availability of water and, on the other hand, bring intense rains in short periods of time that generate other unwanted events that affect our operation and also our surrounding communities, such as road closures, infrastructure, landslides, among others. Additionally, rising sea levels and storm surges, increasing the days of port closures could impact the supply chain affecting our customers and suppliers. Other events such as storm patterns and intensities, increased wind speed, heat waves, cold waves, among other events considered as acute physical risks of climate change. Other effects are related to temperature levels, including increased volatility in seasonal temperatures through excessively high or low temperatures. These extreme weather conditions may vary by geography and location. Weather conditions have historically caused volatility in the agricultural industry (and indirectly in our results of operations) by causing crop failures or significantly reduced harvests, which can adversely affect application rates, demand for our plant nutrition products and our customers’ creditworthiness. Weather conditions can also lead to a reduction in farmable acres, flooding, drought or wildfires, which could also adversely impact growers’ crop yields and the uptake of plant nutrients, reducing the need for application of plant nutrition products for the next planting season which could result in lower demand for our plant nutrition products and negatively impact the prices of our products. Any prolonged change in weather patterns in our markets, as a result of climate change or otherwise, could have a material adverse impact on the results of our operations. Risks Relating to Financial Markets ANNEX 183 Currency fluctuations may have a negative effect on our financial performance. We transact a significant portion of our business in U.S. dollars, and the U.S. dollar is the currency of the primary economic environment in which we operate. In addition, the U.S. dollar is our functional currency for financial statement reporting purposes. A significant portion of our costs, however, is related to the Chilean peso. Therefore, an increase or decrease in the exchange rate between the Chilean peso and the U.S. dollar would affect our costs of production. The Chilean peso has been subject to large devaluations and revaluations in the past and may be subject to significant fluctuations in the future. As of December 31, 2022, the Chilean peso exchange rate was Ch$855.86 per U.S. dollar, while as of December 31, 2021 the Chilean peso exchange rate was Ch$844.69 per U.S. dollar. The Chilean peso therefore depreciated against the U.S. dollar by 1.3% in 2022. As of March 1, 2023, the Observed Exchange Rate was Ch$829.97 per U.S. dollar. As an international company operating in several other countries, we also transact business and have assets and liabilities in other non-U.S. dollar currencies, such as, among others, the Euro, the South African rand, the Mexican peso, the Chinese yuan, the Thai baht and the Brazilian real. As a result, fluctuations in the exchange rates of such foreign currencies to the U.S. dollar may have a material adverse effect on our business, financial condition and results of operations. We may be subject to risks associated with the discontinuation, reform or replacement of benchmark indices. Interest rate, foreign exchange rate and other types of indices which are deemed to be “benchmarks” are the subject of increased regulatory scrutiny and may be discontinued, reformed or replaced. For example, in 2017, the U.K. Financial Conduct Authority announced that it will no longer persuade or compel banks to submit rates for the calculation of the London interbank offered rate (“LIBOR”) benchmark after 2021. This reform will, and other future reforms may, cause benchmarks to be different than they have been in the past, or to disappear entirely, or have other consequences which cannot be fully anticipated which introduces a number of risks for our business. These risks include (i) legal risks arising from potential changes required to document new and existing transactions; (ii) financial risks arising from any changes in the valuation of financial instruments linked to benchmark rates; (iii) pricing risks arising from how changes to benchmark indices could impact pricing mechanisms on some instruments; (iv) operational risks arising from the potential requirement to adapt IT systems, trade reporting infrastructure and operational processes; and (v) conduct risks arising from the potential impact of communication with customers and engagement during the transition period. Various replacement benchmarks, and the timing of and mechanisms for implementation are being considered. The transition away from LIBOR to risk- free reference rates (RFRs) requires financial firms to make a variety of internal changes, for example updating front-and back-office systems, retraining staff and redesigning processes, as well as potentially modifying or renegotiating potentially thousands of LIBOR-linked contracts. All banks and other financial market participants must eliminate their dependence on LIBOR by the end of June 2023 if they are to avoid disruption when the publication of LIBOR ceases. Although as of December 31, 2022 we had approximately US$70 million short- and long-term debt that use a LIBOR benchmark, it is not currently possible to determine whether, or to what extent, any such changes would affect us. However, the discontinuation or reformation of existing benchmark rates or the implementation of alternative benchmark rates may have a material adverse effect on our business, financial condition and results of operations. In addition to the financial benchmarks, there are also market benchmarks used for the pricing of our long-term supply contracts, which may also be subject to regulatory scrutiny, or which may be discontinued, reformed or replaced. For example, for some of our long-term supply contracts, prices reference to indices prepared by commodity reporting agencies such as the Shanghai Metals Market (SMM) and Fastmarkets. ANNEX 184 Risks Relating to Chile As we are a company based in Chile, we are exposed to political risks and civil unrest in Chile. Our business, financial conditions and results of operations could be affected by changes in policies of the Chilean government, other political developments in or affecting Chile, legal changes in the standards or administrative practices of Chilean authorities or the interpretation of such standards and practices, over which we have no control. The Chilean government has modified, and has the ability to modify, monetary, fiscal, tax, social and other policies in order to influence the Chilean economy or social conditions. We have no control over government policies and cannot predict how those policies or government intervention will affect the Chilean economy or social conditions, or, directly and indirectly, our business, financial conditions and results of operations. Changes in policies involving exploitation of natural resources, taxation and other matters related to our industry may adversely affect our business, financial conditions and results of operations. We are exposed to economic and political volatility and civil unrest in Chile. Changes in social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in Chile, as well as crises and political uncertainties in Chile, could adversely affect economic growth in Chile. In October and November 2019, Chile experienced riots and widespread mass demonstrations in Santiago and other major cities in Chile, triggered by an increase in public transportation fares in the city of Santiago, which involved violence and significant property damage and caused commercial disruptions throughout the country. As a result, on October 18, 2019 the Chilean government declared a 15-day period state of emergency and imposed a nighttime curfew in the greater Santiago region and other cities. The state of emergency has since been lifted and the Chilean government has introduced several social reforms. In December 2021, Chile elected Gabriel Boric as the new president. President Boric took office on March 11, 2022 and his agenda is mainly focused on the elimination of private pension funds, social security programs, increases in the minimum wage and pensions, and increases in corporate taxes. President Boric is also a strong supporter of constitutional reforms and the drafting of a new Constitution. While it is still very early in President Boric’s term and there is uncertainty regarding how President Boric’s reforms may affect the political and business climate in Chile in the future, it is possible that these reforms could lead to higher-than-expected inflation levels, unemployment, higher corporate taxes and financial constraints on small and medium-sized companies, any of which could have an adverse effect on our business, results of operations, and financial condition. Future adverse developments in Chile, including political events, financial or other crises, changes to policies regarding foreign exchange controls, regulations, and taxation, may impair our ability to execute our business plan and could adversely affect our growth, results of operations, and financial condition. Inflation, devaluation, social instability, and other political, economic, or diplomatic developments could also reduce our profitability. Economic and market conditions in Chilean financial and capital markets may be affected by international events, which could unfavorably affect the value of our securities. Changes to the Chilean Constitution could impact a wide range of rights, including mining rights and water rights, and could affect our business, financial conditions and results of operations. On July 4, 2021, a Constitutional Convention was installed with the purpose of drafting a proposal of new Constitution within one year. The proposal drafted by the Constitutional Convention was submitted to a national compulsory plebiscite on September 4, 2022. This plebiscite resulted into the rejection of such proposal with 61.86% of voters rejecting the proposal drafted by the Constitutional Convention, and 37.14% of them approving it. Consequently, the 1980 Constitution remains in force. ANNEX 185 However, on December 12, 2022, almost all political parties represented at the National Congress agreed upon the basis for the drafting and the approval of a new Constitution. This agreement led to the approval of Law No. 21,533, which was published in the Official Gazette on January 17, 2023. Law No. 21,533 creates the following institutions: (i) a Commission of Experts; (ii) a Constitutional Council; and (iii) an Admissibility Technical Committee. The Commission of Experts will be responsible for writing a preliminary draft, which will be used by the Constitutional Council as basis for the discussion and composition of a proposal of new Constitution. Both, the Commission of Experts and the Constitutional Council, must respect certain minimal contents, called “essential institutional principles”. For example, (i) Chile is a democratic republic; (ii) the Chilean State is unitary and decentralized; (iii) the Chilean national is only one and indivisible; (iv) Chile is a social and democratic State governed by the rule of law, that promotes the progressive development of social rights in accordance with the principle of fiscal responsibility, and through State and private institutions; (v) the Chilean State is divided into three separate and independent branches, i.e. the Executive, Legislative and Judicial Powers; (vi) the head of the Government will have exclusive initiative of the bills of law that involve public expenditure; (vii) the Legislative Power will be composed of a Chamber of Representatives and a Senate; and (viii) the recognition of the right to property and its different manifestations, amongst other rights. In order to ensure that the essential institutional principles are respected and included in the new constitutional proposal, the Admissibility Technical Committee will be in charge of: (i) determining, upon request of the members of the Constitutional Council or Commission of Experts, whether an approved provision should be declared inadmissible on the ground that it contradicts the essential institutional principles; or (ii) instructing the Commission of Experts to draft a proposal of provision in case one or more of the referred principles have been omitted. The final proposal of a new Constitution must be approved by 3/5 of the seats in the Constitutional Council. This proposal will then be submitted to a national plebiscite with mandatory vote in which citizens will decide whether to approve or reject the proposal. Please note that the constitutional process has not yet started. The installation of the Commission of Experts and the Admissibility Technical Committee is expected to take place on March 6, 2023, and the investiture of the Constitutional Council is scheduled for June 7, 2023. As a result of the new constituent process, a wide range of rights could potentially be under consideration for reform, including mining rights and water rights. There can be no assurance that the Constitutional Council will agree on a proposal of new Constitution that will be approved by the Chilean citizens on December 17, 2023. It can be neither affirmed that the Chilean citizens will approve any kind of proposal of new Constitution to replace the current one. Any changes to rights under a new Chilean Constitution could change the political situation of Chile and affect the Chilean economy and the business outlook for the country generally and our business, results of operations, and financial conditions. If the proposal of new Constitution is rejected, the existing Chilean Constitution, which has been in place since 1980, will remain in effect. Changes in regulations regarding, or any revocation or suspension of mining, port or other concessions could affect our business, financial condition and results of operations. We conduct our mining operations, including brine extraction, under exploitation and exploration concessions granted in accordance with provisions of the Chilean Constitution and related laws and statutes. Our exploitation concessions essentially grant a perpetual right (with the exception of the rights granted to SQM Salar with respect to the Salar de Atacama concessions under the Corfo Agreements described above, which expires in 2030) to conduct mining operations in the areas covered by the concessions, provided that we pay annual concession fees. Our exploration concessions permit us to explore for mineral resources on the land covered thereby for a specified period of time and to subsequently request a corresponding exploitation concession. Any changes to the Chilean Constitution ANNEX 186 with respect to the exploitation and exploration of natural resources and concessions granted as a result of the constitutional convention could materially adversely affect our existing exploitation and exploration concessions or our ability to obtain future concessions and could have a material adverse effect on our business, financial condition and results of operations. We also operate port facilities at Tocopilla, Chile, for the shipment of products and the delivery of raw materials pursuant to maritime concessions, which have been granted under applicable Chilean laws and are normally renewable on application, provided that such facilities are used as authorized and annual concession fees are paid. Any significant adverse changes to any of these concessions, any changes to regulations to which we are subject or adverse changes to our other concession rights, or a revocation or suspension of any of our concessions, could have a material adverse effect on our business, financial condition and results of operations. Changes in water rights laws and other regulations could affect our business, financial condition and results of operations. We hold water use rights that are key to our operations. These rights were obtained from the Chilean Water Authority (Dirección General de Aguas) for supply of water from rivers and wells near our production facilities, which we believe are sufficient to meet current operating requirements. In January 2022, the Chilean Congress approved a bill that amends the Chilean Water Code (Código de Agua), which was published on April, 6, 2022, becoming an applicable Chilean law. This modification introduces several changes to the Water Code. A significant amendment is the change in the time periods for which the water rights were granted. According to this new legislation, water rights: (1) will have a temporary nature being granted for a maximum of 30 years (the specific period will depend on the characteristic of the riverbed and its water availability); (2) will be subject, in whole or in part, to expiration for its non-use; (3) will have to give human consumption and sanitation priority in the use of water (establishing priority orders and possible limitations in the granting and use of water depending on its destination); (4) will be subject to a minimum ecological flow to ensure nature conservation and environmental protection, as determined by the Chilean Water Authority; and (5) will be subject to the obligation of registration in the respective Real Estate Registry and in the Public Water Cadaster of the Chilean Water Authority, and to sanctions of expiration and fines in case of non-compliance. It shall be noted that the water regulation and its distribution will probably be one of the most important focuses of the new constitutional process, and therefore, new changes may come into effect. The Chilean Congress is considering a draft bill that declares lithium mining to be in the national interest, which if passed in its current form, could enable the expropriation of our lithium assets. The Chilean Congress is currently discussing a bill, Bulletin No. 10,638-08, which “Declares the exploitation and commercialization of lithium and Sociedad Química y Minera de Chile S.A. to be of national interest.” The purpose of this bill is to enable the potential expropriation of our assets, or our lithium operations in general. The bill is subject to further discussion in the Chilean Congress, which includes several possible changes to its current wording. We cannot guarantee that the bill will not eventually be approved by the Chilean Congress, or that its final wording will not refer to us or our lithium operations. If the bill is approved as currently drafted, it could have a material adverse effect on our business, financial condition and results of operations. The Chilean government could levy additional taxes on mining companies, which may include lithium exploitation companies, operating in Chile. The Chilean Internal Revenue Service (“SII” in its Spanish acronym) has sought to broaden the application of the specific tax on mining activities in Chile to the extraction of lithium, a substance that ANNEX 187 is not concessionable by law, and has levied taxes in the amount of US$ 127.1 million on SQM Salar for the tax years 2012 to 2018 (business years 2011 to 2017) on that basis. SQM Salar paid the tax assessments and filed three tax claims against the SII challenging these taxes and in two of the cases, covering the 2012-2014 and 2015-2016 tax years, the Santiago Court of Appeal ruled invalid the first instance ruling handed down by the Tax and Customs Court, in each ruling, ordering the case reopened with the competent judge hearing evidence in the case. In the third case covering the 2017-2018 tax years, the Tax and Customs Court upheld SQM Salar’s claim and ordered that these tax assessments be annulled. In 2022, the SII assessed SQM Salar US$ 36.8 million for the 2019 tax year with respect to the specific mining tax and other adjustments, which SQM Salar intends to appeal within the one-year appeal period. While the SII has not issued an assessment for the specific mining tax for the 2020 and later tax years, if the SII uses criteria similar to that used in previous years, it may issue an assessment in the future for these tax periods, which we estimate could result in a potential assessment by the SII of approximately US$ 745.3 million (after deduction of the corporate income tax), exclusive of interests and fines. To date, we have not recorded any effect corresponding to the 2019 tax assessment or any potential assessments for later tax periods in our profit and loss statements. If the SII ultimately prevails in the pending legal proceedings or continues to assess additional taxes based on its interpretation of the application of the specific mining tax to lithium extraction, it could have a material adverse effect on our business, financial condition and results of operations. Since 2006, a specific mining tax has applied to copper mining activities in Chile. The Chilean Congress is currently discussing a bill (Bulletin No. 12,093 08), which proposes to institute a royalty tax to replace the mining tax. In the bill currently under consideration, the royalty tax would have an ad valorem component based on a fixed percentage of annual sales of copper applicable to mining operators with sales above a specified threshold level and a variable component based on a variable rate applied to the mining operator’s adjusted taxable mining operating income. While the bill in its current form would not apply to the lithium mining industry, the bill is subject to further discussion and amendment by the Chilean Congress. We cannot assure you whether the bill will be approved by the Chilean Congress in its current form or if additional changes may be incorporated, including to extend its application to the lithium industry in Chile. If the final bill adopted imposes a new tax on the lithium exploitation, it could have a material adverse effect on our business, financial condition and results of operations.] New legislation affecting mining licenses could materially adversely affect our mining licenses and mining concessions. Law No. 21,420, published in the Official Gazette on February 4, 2022, reduces or eliminates certain tax exemptions in order to finance a new social security program called “Universal Guaranteed Pension”. Among other changes, this law contemplates amendments to the Chilean Mining Code, such as: (i) the increase in the value of the mining licenses related to the mining concessions (an increase of at least 4 times the previous value); (ii) the modification of the term on which the mining exploration concessions are granted and the prohibition on the holder to obtain a new mining exploration concession in the same area once the previous concession has expired; and (iii) amendments to the mining concessions award process. Law 21,536, published in the Official Gazette on January 26, 2023, established that the amendments to the Chilean Mining Code will become effective on January 1, 2024. Ratification of the International Labor Organization’s Convention 169 concerning indigenous and tribal peoples might affect our development plans. Chile, a member of the International Labor Organization (“ILO”), has ratified the ILO’s Convention 169 (the “Indigenous Rights Convention”) concerning indigenous and tribal people. The Indigenous Rights Convention established several rights for indigenous people and communities. Among other rights, the Indigenous Rights Convention states that (i) indigenous groups should be notified and consulted prior to ANNEX 188 the development of any project on land deemed indigenous, although veto rights are not mentioned, and (ii) indigenous groups have, to the extent possible, a stake in benefits resulting from the exploitation of natural resources in indigenous land. The extent of these benefits has not been defined by the Chilean government. The Chilean government has addressed item (i) above through Supreme Decree No. 66, issued by the Social Development Ministry. This decree requires government entities to consult indigenous groups that may be directly affected by the adoption of legislative or administrative measures, and it also defines criteria for the projects or activities that must be reviewed through the environmental evaluation system that also require such consultation. To the extent that the new rights outlined in the Indigenous Rights Convention become laws or regulations in Chile, judicial interpretations of the convention of those laws or regulations could affect the development of our investment projects in lands that have been defined as indigenous, which could have a material adverse effect on our business, financial condition and results of operations. The Chilean Supreme Court has consistently held that consultation processes must be carried out in the manner prescribed by the Indigenous Rights Convention. The consultation process may cause delays in obtaining regulatory approvals, including environmental permits, as well as public opposition by local and/or international political, environmental and ethnic groups, particularly in environmentally sensitive areas or in areas inhabited by indigenous populations. Furthermore, the omission of the consultation process when required by law may result in the revocation or annulment of regulatory approvals, including environmental permits already granted. Consequently, operating projects may be affected since the omission of the consultation process, when required by law, could lead to public law annulment actions pursuing the annulment of the environmental permits granted. However, this risk frequently arises during the environmental assessment phase when the environmental permits are to be obtained. In such scenario, affected parties may take several legal actions to declare null or void the environmental permits that omitted the consultation process, and in some cases, courts have overturned environmental approvals in which consultation was not made as prescribed in the Indigenous Rights Convention. If the Indigenous Rights Convention affects our development plans, it could have a material adverse effect on our business, financial condition and results of operations. Chile has different corporate disclosure and accounting standards than those you may be familiar with in the United States. Accounting, financial reporting and securities disclosure requirements in Chile differ in certain significant respects from those required in the United States. Accordingly, the information about us available to you will not be the same as the information available to holders of securities issued by a U.S. company. In addition, although Chilean law imposes restrictions on insider trading and price manipulation, applicable Chilean laws are different from those in the United States, and the Chilean securities markets are not as highly regulated and supervised as the U.S. securities markets. Chile is located in a seismically active region. Chile is prone to earthquakes because it is located along major fault lines. During 2017-2022, Chile has experienced several earthquakes which had a magnitude of over 6.0 on the Richter scale. There were also earthquakes in the past decade that caused substantial damage to some areas of the country. Chile has also experienced volcanic activity. A major earthquake or a volcanic eruption could have significant negative consequences for our operations and for the general infrastructure, such as roads, rail, and access to goods, in Chile. Although we maintain industry standard insurance policies that include earthquake coverage, we cannot assure you that a future seismic or volcanic event will not have a material adverse effect on our business, financial condition and results of operations. ANNEX 189 Risks Relating to our Shares and to our ADSs The price of our ADSs and the U.S. dollar value of any dividends will be affected by fluctuations in the U.S. dollar/Chilean peso exchange rate. Chilean trading in the shares underlying our ADSs is conducted in Chilean pesos. The depositary for our ADSs will receive cash distributions that we make with respect to the shares in Chilean pesos. The depositary will convert such Chilean pesos to U.S. dollars at the then prevailing exchange rate to make dividend and other distribution payments in respect of ADSs. If the value of the Chilean peso falls relative to the U.S. dollar, the value of the ADSs and any distributions to be received from the depositary will decrease. Developments in other emerging markets could materially affect the value of our ADSs and our shares. The Chilean financial and securities markets are, to varying degrees, influenced by economic and market conditions in other emerging market countries or regions of the world. Although economic conditions are different in each country or region, investor reaction to developments in one country or region can have significant effects on the securities of issuers in other countries and regions, including Chile and Latin America. Events in other parts of the world may have a material effect on Chilean financial and securities markets and on the value of our ADSs and our shares. The prices of securities issued by Chilean companies, including banks, are influenced to varying degrees by economic and market considerations in other countries. We cannot assure you that future developments in or affecting the Chilean economy, including consequences of economic difficulties in other markets, will not materially and adversely affect our business, financial condition or results of operations. We are exposed to risks related to the weakness and volatility of the economic and political situation in Asia, the United States, Europe, other parts of Latin America and other nations. Although economic conditions in Europe and the United States may differ significantly from economic conditions in Chile, investors’ reactions to developments in these other countries may have an adverse effect on the market value of securities of Chilean issuers. If these, or other nations’ economic conditions deteriorate, the economy in Chile, as both a neighboring country and a trading partner, could also be affected and could experience slower growth than in recent years, with possible adverse impact on our borrowers and counterparties. The volatility and low liquidity of the Chilean securities markets could affect the ability of our shareholders to sell our ADSs. The Chilean securities markets are substantially smaller, less liquid and more volatile than the major securities markets in the United States. The volatility and low liquidity of the Chilean markets could increase the price volatility of our ADSs and may impair the ability of a holder to sell our ADSs or to sell the shares underlying our ADSs into the Chilean market in the amount and at the price and time the holder wishes to do so. ANNEX 190 Our share or ADS price may react negatively to future acquisitions, divestitures, capital increases and investments. As world leaders in our core businesses, part of our strategy is to look for opportunities that will allow us to consolidate and strengthen our competitive position in jurisdictions in which we currently do not operate. Pursuant to this strategy, we may carry out acquisitions or joint ventures relating to any of our businesses or to new businesses in which we believe we may have sustainable competitive advantages. We may also seek to strengthen our leadership position in our core businesses through divestitures of certain assets or stakes in subsidiaries that we believe will allow us to concentrate our efforts on our core businesses. Depending on our capital structure at the time of any acquisitions or joint ventures, we may need to raise significant debt and/or equity which will affect our financial condition and future cash flows. We may also carry out capital increases, such as the one undertaken in 2021, in order to raise capital for our capital plan. In addition, any divestitures we effect may not result in strengthening our position in our core businesses as anticipated. Any change in our financial condition could affect our results of operations and negatively impact our share or ADS price. ADS holders may be unable to enforce rights under U.S. securities laws. Because we are a Chilean company subject to Chilean law, the rights of our shareholders may differ from the rights of shareholders in companies incorporated in the United States, and ADS holders may not be able to enforce or may have difficulty enforcing rights currently in effect under U.S. federal or state securities laws. Our company is an open stock corporation incorporated under the laws of the Republic of Chile. Most of our directors and officers reside outside the United States, principally in Chile. All or a substantial portion of the assets of these persons are located outside the United States. As a result, if any of our shareholders, including holders of our ADSs, were to bring a lawsuit against our officers or directors in the United States, it may be difficult for them to effect service of legal process within the United States upon these persons. Likewise, it may be difficult for them to enforce judgments obtained in United States courts based upon the civil liability provisions of the federal securities laws in the United States against them in the United States. In addition, there is no treaty between the United States and Chile providing for the reciprocal enforcement of foreign judgments. However, Chilean courts have enforced judgments rendered in the United States, provided that the Chilean court finds that the United States court respected basic principles of due process and public policy. Nevertheless, there is doubt as to whether an action could be brought successfully in Chile in the first instance on the basis of liability based solely upon the civil liability provisions of the United States federal securities laws. As preemptive rights may be unavailable for our ADS holders, they have the risk of their holdings being diluted if we issue new stock. Chilean laws require companies to offer their shareholders preemptive rights whenever issuing new shares of capital stock so shareholders can maintain their existing ownership percentage in a company. If we increase our capital by issuing new shares, a holder may subscribe for up to the number of shares that would prevent dilution of the holder’s ownership interest. If we issue preemptive rights, United States holders of ADSs would not be able to exercise their rights unless a registration statement under the Securities Act were effective with respect to such rights and the shares issuable upon exercise of such rights or an exemption from registration were available. We cannot assure holders of ADSs that we will file a registration statement or that an exemption from registration will be available. Although in connection with the 2021 capital increase, we filed a registration statement ANNEX 191 that permitted holders of ADSs to exercise preemptive rights, we may, in our absolute discretion, decide not to prepare and file such a registration statement in a future capital increase. If our ADS holders were unable to exercise their preemptive rights in a future capital increase because we do not file a registration statement, the ADS depositary would attempt to sell their rights and distribute the net proceeds from the sale to them, after deducting the depositary’s fees and expenses. If the ADS depositary is not able sell the rights, the rights would expire and have no further value and holders of ADSs would not realize any value from them. In either case, ADS holders’ equity interests in us would be diluted in proportion to the increase in our capital stock. If we were classified as a Passive Foreign Investment Company by the U.S. Internal Revenue Service, there could be adverse consequences for U.S. investors. We believe that we were not classified as a Passive Foreign Investment Company (“PFIC”) for 2022. Characterization as a PFIC could result in adverse U.S. tax consequences to a U.S. investor in our shares or ADSs. For example, if we (or any of our subsidiaries) are a PFIC, our U.S. investors may become subject to increased tax liabilities under U.S. tax laws and regulations and will become subject to burdensome reporting requirements. The determination of whether or not we (or any of our subsidiaries or portfolio companies) are a PFIC is made on an annual basis and will depend on the composition of our (or their) income and assets from time to time. See “Item 10.E. Taxation—Material United States Tax Considerations.” Receipt of dividends and distributions by ADS holders may be limited by practical considerations and legal limitations, which may delay the payment and receipt of dividends and distributions by ADS holders. Holders of ADSs generally have the right to receive dividends and other distributions we make on Series B common shares held by the ADS custodian under the terms of the deposit agreement in proportion to the number of ADSs held as of the specified record date, after deduction of the applicable fees, taxes and expenses. Receipt of these dividends and distributions may be limited by practical considerations and legal limitations, which may delay the payment and receipt of dividends and distributions by ADS holders. Changes in Chilean tax regulations could have adverse consequences for U.S. investors. Cash dividends paid by the Company with respect to the shares, including the shares represented by ADSs, will be subject to a Chilean withholding tax at a rate of 35%, less the credit available for corporate tax, which must be withheld and paid by the Company (the “Withholding Tax”). The effective rate of Withholding Tax imposed on dividends attributed to earnings in 2022 of the Company and distributed during the same period was 23.90411%. Changes in Chilean tax regulations could have adverse consequences for U.S. investors. For example, the changes introduced by Law No. 21,420 published in the Official Gazette on February 4, 2022 and effective on September 1, 2022, by which the highest value or gain obtained in the sale on the stock exchange or in a public offering process of shares of corporations with a high stock market presence will be affected by a single tax with a rate of 10%, except for certain institutional investors, could have adverse tax consequences for investors resident in the United States. General Risk Factors ANNEX 192 Our measures to minimize our exposure to bad debt may not be effective and a significant increase in our accounts receivable coupled with the financial condition of customers may result in losses that could have a material adverse effect on our business, financial condition and results of operations. Potentially negative effects of global economic conditions on the financial condition of our customers may include the extension of the payment terms of our accounts receivable and may increase our exposure to bad debt. While we have implemented certain safeguards, such as using credit insurance, letters of credit and prepayment for a portion of sales, to minimize the risk, we cannot assure you that such safeguards will be effective and a significant increase in our accounts receivable coupled with the financial condition of customers may result in losses that could have a material adverse effect on our business, financial condition and results of operations. Quality standards in markets in which we sell our products could become stricter over time. In the markets in which we do business, customers may impose quality standards on our products and/or governments may enact stricter regulations for the distribution and/or use of our products. As a result, if we cannot meet such new standards or regulations, we may not be able to sell our products. In addition, our cost of production may increase in order to meet any such newly imposed or enacted standards or regulations. Failure to sell our products in one or more markets or to important customers could materially adversely affect our business, financial condition and results of operations. Our business is subject to many operating and other risks for which we may not be fully covered under our insurance policies. Our facilities and business operations in Chile and abroad are insured against losses, damage or other risks by insurance policies that are standard for the industry and that would reasonably be expected to be sufficient by prudent and experienced persons engaged in businesses similar to ours. We may be subject to certain events that may not be covered under our insurance policies, which could have a material adverse effect on our business, financial condition and results of operations. Additionally, as a result of major earthquakes and unexpected rains and flooding in Chile, as well as other natural disasters worldwide, conditions in the insurance market have changed and may continue to change in the future, and as a result, we may face higher premiums and reduced coverage, which could have a material adverse effect on our business, financial condition and results of operations. Our water supply could be affected by geological changes or climate change. Our access to water may be impacted by changes in geology, climate change or other natural factors, such as wells drying up or reductions in the amount of water available in the wells or rivers from which we obtain water, that we cannot control. The use of seawater for future or current operations could increase our operating costs. In addition, seawater projects could face timing issues and permits uncertainty which make them difficult to develop and construct. Any such change may have a material adverse effect on our business, financial condition and results of operations. Any loss of key personnel may materially and adversely affect our business. Our success depends in large part on the skills, experience and efforts of our senior management team and other key personnel. The loss of the services of key members of our senior management or employees with critical skills could have a negative effect on our business, financial condition and results of operations. If we are not able to attract or retain highly skilled, talented and qualified senior managers or other key personnel, our ability to fully implement our business objectives may be materially and adversely affected. ANNEX 193 We are subject to Chilean and international anti-corruption, anti-bribery, anti-money laundering and international trade laws. Failure to comply with these laws could adversely impact our business, financial condition and results of operations. We are required to be in compliance with all applicable laws and regulations in Chile and internationally with respect to anti-corruption, anti-money laundering and other regulatory matters, including the FCPA. Although we and our subsidiaries maintain policies and processes intended to comply with these laws, we cannot ensure that these compliance policies and processes will prevent intentional, reckless or negligent acts committed by our officers or employees. If we or our subsidiaries fail to comply with any applicable anti-corruption, anti-bribery, anti-money laundering or other similar laws, we and our officers and employees may be subject to criminal, administrative or civil penalties and other remedial measures, which could have material adverse effects on our and our subsidiaries’ business, financial condition and results of operations. Any investigation of potential violations of anti-corruption, anti-bribery or anti-money laundering laws by governmental authorities in Chile or other jurisdictions could result in an inability to prepare our consolidated financial statements in a timely manner. This could adversely impact our reputation, ability to access the financial markets and ability to obtain contracts, assignments, permits and other government authorizations necessary to participate in our and our subsidiaries’ industry, which, in turn, could have adverse effects on our and our subsidiaries’ business, financial condition and results of operations. We are subject to risks related to the ongoing military conflict between Ukraine and Russia and it may have a material adverse effect on our business, financial condition and results of operations On February 24, 2022, Russia launched a military invasion of Ukraine. The ongoing military conflict between Russia and Ukraine has provoked strong reactions from the United States, the UK, the European Union and various other countries around the world, including the imposition of broad financial and economic sanctions against Russia. While the precise effects of the ongoing military conflict and these sanctions on the Russian and global economies remain uncertain, they have already resulted in significant volatility in financial markets as well as in an increase in energy and commodity prices globally. Should the conflict continue or escalate, markets may face various economic and security consequences including, but not limited to, supply shortages of different kinds, further increases in prices of commodities, including natural gas, oil, fertilizers and agricultural goods, significant disruptions in logistics infrastructure, telecommunications services, the risk of unavailability of information technology systems and infrastructure, among others, given that Russia and Ukraine are significant exporters of commodities. The resulting impacts on financial markets, inflation, interest rates, unemployment and other matters could disrupt the global economy. Other potential consequences include, but are not limited to, growth in the number of popular uprisings in the region, increased political discontent, especially in the regions most affected by the conflict or economic sanctions, increase in cyberterrorism activities and attacks, displacement of persons to regions close to the areas of conflict and an increase in the number of refugees fleeing across Europe, among other unforeseen social and humanitarian effects. ANNEX 194 ANNEX 2. SUBSIDIARIES AND ASSOCIATES Subsidiaries in Chile Name of Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets AGRORAMA S.A. Corporation US$118,400 99.999% SQMC S.A. 0.001% SQM Industrial S.A. -0.07754% Corporate Purpose Board of Directors Sales and distribution of fertilizers, pesticides and agricultural inputs Rodrigo Millán Riffo Rodrigo Real Ibaceta Enrique Olivares Carlini CEO / Legal Representative Relation / Contracts with parent company Rodrigo Real Ibaceta Distribution AJAY-SQM CHILE S.A. Corporation US$5,313,794 ALMACENES Y DEPOSITOS LTDA. Limited liability corporation US$919,796 COMERCIAL AGRORAMA LTDA Limited liability corporation US$947,200 51% SQM S.A. 49% Otros no relacionados 99% SQM Potasio S.A. 1% SQM S.A. 70% SQMC S.A. 30% Others non related 0.14567% Iodine derivatives production, sales and marketing Alec Poitevint Matt Webb Trinidad Reyes Daniel Pizarro Carlos Grez Production and distribution / Commercial agreement 0.00440% General deposit activities No tiene Ricardo Ramos R.* Support -0.02322% Sales and distribution of fertilizers, pesticides and agricultural inputs No tiene Rodrigo Real Ibaceta Distribution COMERCIAL HYDRO S.A. Corporation US$4,818,186 99.9999% SQMC S.A. 0.0001% Agrorama S.A. 0.08053% Import and marketing of fertilizers Carlos Ríos M. Roberto Campusano B. Rodrigo Real Ibaceta Rodrigo Real Ibaceta Support * Director, CEO, or Principal Executive of SQM S.A. ANNEX 195 Name of Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative Relation / Contracts with parent company EXPLORACIONES MINERAS S.A. Corporation US$30,100,000 0.269103% SQM S.A. 99.730897% SQM Potasio S.A. 0.50615% Explotation of other mines and quarries José Miguel Berguño C.* Ricardo Ramos R.* Gerardo Illanes G. * Ricardo Ramos R.* Support INSTITUCION DE SALUD PREVISIONAL NORTE GRANDE LTDA. Limited Liability Corporation US$59,200 99% SQM Industrial S.A. 1% SQM S.A. 0.01154% Administration of health matters for SQM S.A. Not applicable Humberto Riquelme Support ORCOMA ESTUDIOS SPA Joint stock company US$4,631,507 100% SQM S.A. 0.07687% ORCOMA SPA Joint stock company US$2,357,731 100% SQM S.A. 0.03858% Open Stock Corporation US$9,873,573 99.99966% SQM Industrial S.A. 0.00034% SQM S.A. 0.23737% SERVICIOS INTEGRALES DE TRANSITOS Y TRANSFERENCIAS S.A. ANNEX Exploration, measurement, prospection and research of mineral deposits for extraction, production and mineral processing Exploration, measurement, prospection, research, development and operation of mineral deposits for extraction, production and processing Transport and storage of merchandise None Rodrigo Vera D. Not applicable / None as of date None Rodrigo Vera D. Not applicable / None as of date José Miguel Berguño B.* Ricardo Ramos R.* Pablo Altimiras C.* Gerardo Illanes G.* Carlos Diaz O. * Ricardo Ramos R.* Distribution 196 Name of Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative Relation / Contracts with parent company SOCIEDAD PRESTADORA DE SERVICIOS DE SALUD CRUZ DEL NORTE S.A. Corporation US$59,200 99% SQM Industrial S.A. 1% SQM Potasio S.A. 0.00229% Provision of health- related services Mauricio Guerra Oliveros Sergio Figueroa Rodriguez Raquel Ahumada Cabrera Sergio Figueroa Rodríguez Support SOQUIMICH COMERCIAL S.A. Open Stock Corporation US$61,745,898 60.6383212% SQM Industrial S.A. 0.0000004% SQM S.A. 39.3616784% Otros no relacionados 0.68593% SQM INDUSTRIAL S.A. Corporation US$715,066,287 99.047043% SQM S.A. 0.952957% SQM Potasio S.A. 18.11220% Production and marketing of fertilizers Bogdan Borkowski S. Pablo Altimiras C.* Macarena Briseño Francisco Javier Fontaine S. Gerardo Illanes G.* Christian Lüders M. Eugenio Ponce L. Operation of extraction plants, holdings and transfer of mineral substances and raw materials José Miguel Berguño C.* Carlos Diaz O.* Ricardo Ramos R.* Mining exploration and exploitation Rodrigo Real Ibaceta Distribution/Supply Ricardo Ramos R.* Production SQM MAG SPA Joint stock company US$10,000 100% SQM Potasio S.A. 0.01864% No tiene Claudia Diaz A. Production SQM NITRATOS S.A. Corporation US$30,349,981 99.99999782% SQM S.A. 0.00000218% SQM Potasio S.A. 2.00401% Production and sale of fertilizers Pablo Altimiras C.* José Miguel Berguño C.* Carlos Diaz O.* Gerardo Illanes G.* Ricardo Ramos R.* Ricardo Ramos R.* Production ANNEX 197 Name of Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets SQM POTASIO S.A. Corporation US$257,010,492 99.999999% SQM S.A. 0.000001% Otros no relacionados 31.43612% SQM SALAR S.A. Corporation US$38,000,000 81.82% SQM Potasio S.A. 18.18% SQM S.A. 27.46872% Corporate Purpose Board of Directors Extraction of minerals for fertilizer and chemical production Pablo Altimiras C.* José Miguel Berguño C.* Carlos Diaz O.* Gerardo Illanes G.* Ricardo Ramos R.* Exploitation and marketing of potassium, lithium and other products Gina Ocqueteau Tacchini* Constanza Valbuena F. Patricio Contesse F.* Gonzalo Guerrero Y.* Ricardo Ramos R.* CEO / Legal Representative Relation / Contracts with parent company Ricardo Ramos R.* Production Alberto Salas M. Production SOCIEDAD CONTRACTUAL MINERA BÚFALO Sociedad Contractual Minera US$22,949 99.9% SQM S.A. 0.1% SQM Potasio S.A. 0.00041% Export recognize prosper investigate and explore deposits None Ricardo Ramos R.* Production Variable capital corporation US$6,612 99.998% SQM Industrial S.A. 0.002% SQM North America Corporation -0.00285% Services Mario Berrios U. Ignacio Fernández G. Ricardo Ramos R.* Gonzalo Aguirre T.* Gerardo Illanes G.* Christian Lüders M. Pablo Altimiras C.* Ignacio Majluf C. Mario Berrios U. Ignacio Fernández G. Support Corporation US$1,000 100% SQM Investment Corporation N.V. -0.01033% Marketing, importing and exporting Christian Lüders M. Matías Murillo G. Andrés Yaksic B. Christian Lüders M. Support ADMINISTRACION Y SERVICIOS SANTIAGO S.A. DE C.V. COMERCIAL CAIMÁN INTERNACIONAL S.A. ANNEX 198 International Subsidiaries Name of the company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative Relation / Contracts with parent company NITRATOS NATURAIS DO CHILE SERVICIOS LTDA. Limited liability corporation US$774,294 29.18% SQM Industrial S.A. 70,82% SQM Brasil Ltda. -0.03796% Marketing advisory services, representation of other foreign and local companies, administrative support in general None Martim de Almeida Sampaio Support Corporation Investment company NORTH AMERICAN TRADING COMPANY US$338,124 100% SQM North American Corporation 0.00355% Pablo Altimiras C.* Gerardo Illanes G.* Matías Prieto Support Limited liability corporation Limited liability corporation ROYAL SEED TRADING A.V.V. RS AGRO CHEMICAL TRADING CORP. A.V.V. US$6,000 1.67% SQM S.A. 98.33% SQM Potasio S.A. -0.22412% Investment and marketing of moveable property and real estate IMC International Management & Trust Company N.V. IMC International Management & Trust Company N.V. Support US$6,000 98.3333% SQM S.A. 1.6667% SQM Potasio S.A. 0.05965% Investment and marketing of moveable property and real estate IMC International Management & Trust Company N.V. IMC International Management & Trust Company N.V. Support ANEXOS 199 Name of the Company Type of Company Capital SOQUIMICH EUROPEAN HOLDINGS B.V. US$49,265,296 Limited liability corporation Limited liability corporation SQM AFRICA PTY LTD US$70,699 Investment as % of SQM S.A.’s individual assets 5.12562% Ownership 25.23% SQM Corporation N.V. 74.77% SQM Investment Corporation N.V. Corporate Purpose Board of Directors CEO / Legal Representative Investment company Relation / Contracts with parent company Investment Kris Van den Bruel Patrick Vanbeneden Paul van Duuren Paul Zwagerman No tiene 100% Soquimich European Holdings B.V. 0.18520% Marketing of specialty plant nutrients and industrial products Christian Luders M. Patrick Vanbeneden Emmanuel de Marez Ettienne Strydom SQM AUSTRALIA PTY LTD Limited liability corporation US$344,866,483 100% SQM Potasio S.A. 4.93225% Mining – Specifically lithium Jay Leary, Carlos Diaz O.* Gonzalo Aguirre T.* Gerardo Illanes G.* Jay Leary SQM (BEIJING) COMMERCIAL CO. LTDA. SQM BRASIL SERVIÇOS LTDA. Limited liability corporation Limited liability corporation US$1,600,000 100% SQM Industrial S.A. 0.02515% US$3,040,000 99.42% SQM Industrial S.A 0.58% SQM S.A -0.02713% Commission agent and marketing of chemical products Marketing advisory services, representation of other foreign and domestic companies, administrative support in general Patricio de Solminihac T. Frank Biot Ricardo Ramos R.* Victor Larrondo G. No tiene Martim de Almeida Sampaio Support Distribution Investment and exploration activities Not applicable ANEXOS 200 Name of the Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative Relation / Contracts with parent company SQM COLOMBIA LTDA. Join stock company US$1,291,915 100% SQM Industrial S.A. 0.01412% Variable capital corporation Variable capital corporation Import, export and marketing of fertilizers SQM COMERCIAL DE MEXICO S.A. de C.V. US$22,044,533 99.94% SQM Industrial S.A. 0.05% SQM Potasio S.A. 0.01% SQM S.A. 0.99729% Diego Monteros Arregui Ignacio Fernández G. Ignacio Majluf Ricardo Ramos R.* Gerardo Illanes G.* Christian Lüders M. Milton René Galan Rodolfo Hernandez G. Gonzalo Aguirre T.* Mario Berrios U. Ignacio Fernández G. Ricardo Ramos R.* Gonzalo Aguirre T.* Gerardo Illanes G.* Christian Lüders M. Pablo Altimiras C.* Ignacio Majluf C. Diego Monteros Arregui Ignacio Fernández G. Support Mario Berrios U. Ignacio Fernandez G Distribution SQM CORPORATION N.V. Corporation Corporation US$12,939,718 99.9998% SQM Industrial S.A. 0.0002% SQM S.A. 0.62927% Investment in moveable goods and real estate TMF Group TMF Group Support SQM ECUADOR S.A. US$416,900 99.996% SQM Industrial S.A. 0.004% SQM S.A. 0.10101% Wholesale fertilizer sales No tiene Diego Monteros Arregui Distribution ANEXOS 201 Name of the Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets SQM EUROPE N.V. Corporation US$18,656,745 99.42% Soquimich European Holdings B.V. 0.58% SQM S.A. 3.52786% Corporate Purpose Board of Directors Distribution and marketing of specialty plant nutrients and industrial products in Europe, Northern Africa and the Middle and Far East Ricardo Ramos R.* Gonzalo Aguirre T.* Pablo Altimiras C.* Gerardo Illanes G.* Erik Borghijs Kris Van den Bruel CEO / Legal Representative Relation / Contracts with parent company Not applicable Support and distribution Corporation Distribution SQM FRANCE S.A. US$204,061 100% Soquimich European Holdings NV 0.00281% None Oliver Lecaplain Support Corporation SQM HOLLAND B.V. US$19,550,205 100% Soquimich European Holdings NV 0.01303% Plant for the production and distribution of specialty plant nutrients soluble in water Erik Borghijs Patrick Vanbeneden Kris Van den Bruel Marc Goetschalckx None Production and distribution Corporation SQM IBERIAN S.A. US$9,933,128 100% Soquimich European Holdings NV 0.35024% Distribution and marketing of specialty plant nutrients and technical products in Spain Gerardo Illanes G.* Erik Borghys Christian Lüders M. José Andrés Cayuela Enrique Torras Erik Lütken R. Distribution Corporation SQM INDONESIA S.A. US$31,448 80% Soquimich European Holding B.V. 20% Interés Minoritario 0.00003% Import trading and distribution services Frank Biot Patrick Vanbeneden Rudy Ismanto Not applicable Not applicable ANEXOS 202 Name of the Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets SQM INTERNATIONAL N.V. Corporation US$3,079,827 99.42% Soquimich European Holdings B.V. 0.58% SQM S.A. 0.24401% Corporate Purpose Board of Directors Distribution and sales of specialty plant nutrients and industrial products in Europe, North Africa and the Middle and Far East Ricardo Ramos R.* Gonzalo Aguirre T.* Pablo Altimiras C.* Gerardo Illanes G.* Erik Borghijs Kris Van den Bruel CEO / Legal Representative Relation / Contracts with parent company Not applicable Support and distribution SQM INVESTMENT CORPORATION N.V. Corporation US$50,000 99.00% SQM Potasio S.A. 1.00% SQM S.A. 3.91710% Investment and marketing of moveable goods and real estate TMF Group TMF Group Support SQM JAPAN CO. LTD. Limited Liability Corporation US$87,413 15.8147% SQM Potasio S.A. 84.0256% Soquimich European Holdings B.V. 0.1597% SQM S.A. Marketing of products in Asia/Oceania and marketing assistance 0.03584% Pablo Altimiras C.* Gerardo Illanes G.* Andrés Stocker Andrés Stocker Distribution and marketing / Commercial agency agreement SQM KOREA LLC US$700,000 100% SQM Industrial S.A. 0.25788% Limited Liability Corporation Sales, import and export of chemical products Pablo Altimiras C.* Gerardo Illanes G.* Pablo Altimiras C.* Distribution SQM LITHIUM SPECIALTIES LIMITED PARTNERSHIP, L.L.P Limited Liability Corporation US$33,712,430 99% SQM Virginia LLC 1% North American Trading Co. 0.17181% Production and marketing of lithium derivatives No tiene Matías Prieto Support ANEXOS 203 Name of the Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative Relation / Contracts with parent company SQM NITRATOS MEXICO S.A. de C.V. Variable Capital Corporation US$5,636 99.998% SQM Industrial S.A. 0.002% SQM North America Corporation 0.00108% Services SQM NORTH AMERICA CORPORATION Corporate US$79,576,550 51% SQM Industrial S.A. 40% SQM S.A. 9% Soquimich European Holdings B.V. 0.51493% Marketing of nitrates, fertilizers, iodine and lithium in North America US$1 100% SQM Soquimich European Holdings B.V. 0.02831% Import, export and distribution of fertilizers and industrial products US$3,364,341 99.998% SQM European Holdings NV 0.002% Interés Minoritario 0.03558% Marketing of fertilizers and industrial chemicals Mario Berrios U. Ignacio Fernández G. Ricardo Ramos R.* Gonzalo Aguirre T.* Gerardo Illanes G.* Christian Lüders M. Pablo Altimiras C.* Ignacio Majluf C. Gonzalo Aguirre T.* Pablo Altimiras C. * Beatriz Oelckers Gerardo Illanes G.* Ricardo Ramos R.* Gerardo Illanes G.* Andrés Stocker Pablo Altimiras C.* Felipe Smith David Masters Patrick Vanbeneden Andrés Stocker Pattamakan Suparp Christian Lüders M. No aplica Matias Prieto Distribución No tiene Distribución No tiene No aplica US$2,499,995 100% SQM Industrial S.A. 4.63593% Sales, import and export, marketing of chemical products Gonzalo Aguirre T.* Gerardo Illanes G.* Pablo Altimiras C.* Felipe Smith Distribución 204 Corporate Corporate Corporate SQM OCEANIA PTY LIMITED SQM (THAILAND) LIMITED SQM (SHANGHAI) CHEMICALS CORPORATION ANEXOS Name of the Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative Relation / Contracts with parent company SQM VIRGINIA L.L.C. Corporation US$33,375,305 100% SQM North America Corporation 0.17008% Investment company Pablo Altimiras C.* Gerardo Illanes G.* Matias Prieto Soporte SQMC HOLDING CORPORATION Corporation US$3,000,000 99.9% SQM Potasio S.A. 0.1% SQM S.A. 0.62927% Investment company Carlos Diaz O.* Felipe Smith de A. Matias Prieto Soporte Internacional Associates Name of the Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative Relation / Contracts with parent company AJAY EUROPE SARL Corporation US$4,065,738 AJAY NORTH AMERICA L.L.C. Corporation US$10,383,786 50% Soquimich European Holdings B.V. 50% Otros no relacionados Production and distribution of iodine derivatives 0.2046% 49% SQMC Holding Corporation L.L.P. 51% Otros no relacionados 0.4274% Production, sales and marketing of iodine derivatives Daniel Pizarro Trinidad Reyes Alec Poitevint Matt Webb Daniel Pizarro Trinidad Reyes Alec Poitevint Matt Webb Michel Pichon Producción y distribución / Acuerdo comercial Matt Webb Producción y distribución / Acuerdo comercial ANEXOS 205 Joint Ventures or Joint Control Name of the Company Type of Company Capital Ownership Investment as % of SQM S.A.’s individual assets Corporate Purpose Board of Directors CEO / Legal Representative COVALENT LITHIUM PTY LTD Limited liability corporation US$7 50% SQM Australia Pty Ltd 50% Otros no relacionados -0.0291% Administration, design, execution, construction and operation of projects Limited liability corporation PAVONI & C. SPA US$1,478,946 50% Soquimich European Holdings B.V. 50% Otros no relacionados 0.0487% Production, distribution, sales and marketing of specialty fertilizers Ian Hansen Aaron Hood Carlos Díaz O.* Eugenio Ponce L. Patrick Vanbeneden Marc Goetschalckx Giuseppe Casubolo Aldo Bonaccorsi Riccardo Carbone Sara Pavoni Ryan Hair Sara Pavoni Limited liability corporation SQM VITAS BRASIL US$2,556,211 99.99% SQM Vitas FZCO 0.01% Otros no relacionados 0.1972% Production, distribution, sales and marketing of specialty fertilizers Patrick Vanbeneden Karina Kuzmak-Bourdet Christian Luders Leandro Ries SQM VITAS FZCO Sociedad de zona franca US$1,413,043 48.0769231% SQM Industrial S.A. 1.92307692% SQM S.A. 0.0568% Production, distribution, sales and marketing of specialty fertilizers Patrick Vanbeneden Karina Kuzmak-Bourdet Patrick Vanbeneden SQM VITAS PERÚ S.A.C. Sociedad anónima cerrada US$5,162,956 99.99999% SQM Vitas FZCO 0.00001% SQM Industrial S.A. 0.0994% Production, distribution, sales and marketing of specialty fertilizers Patrick Vanbeneden Karina Kuzmak-Bourdet Christian Luders Mauricio Abarca ANEXOS Relation / Contracts with parent company Servicios de administración, diseño, ejecución, construcción y operación de proyectos Producción y distribución / Acuerdo comercial Producción y distribución / Acuerdo comercial Producción y distribución / Acuerdo comercial Producción y distribución / Acuerdo comercial 206 ANEXOS 207 

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