Bengt Brunberg Manager Sustainability, BillerudKorsnäs Gävle, Sweden

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1 SUSTAINABILITY AND ENERGY SAVINGS Sustainable Supply of Wood Raw Material for Pulp Bengt Brunberg Manager Sustainability, BillerudKorsnäs Gävle, Sweden Bengt Brunberg experience is based on 15 years in the forestry research area and 15 years in the former company Korsnäs AB where he held the position as Environmental Manager in forestry and wood supply. He is now holding the position as Sustainability Manager for the company BillerudKorsnäs AB, deeply involved in strategic as well as operational activities in order to develop the sustainability performance. Bengt believes credible and transparent communication is fundamental and hope to contribute to that by meeting and reporting to different stakeholder groups, primarily by collaborating with his organization in meetings with their customers.

2 SUSTAINABLE SUPPLY OF WOOD RAW MATERIAL FOR PULP l Bengt Brunberg, Sustainability Manager 1

3 WHY SUSTAINABILITY IS IMPORTANT FOR BILLERUDKORSNÄS! The Earth is facing real environmental and social problems! Important for our business today and tomorrow! Performance development essential! A relevant framework for communicating what we are actually doing! Our stakeholders expect us to act and evaluate our performance! Make today s staff to feel proud over our efforts! Be an attractive choice for future employees Flood in Malmö, August

4 BILLERUDKORSNÄS STRATEGY PLATFORM 3

5 COMMITMENTS FOR A SUSTAINABLE FUTURE Economy Responsible business for products that add values in many ways Environment Renewable and sustainably produced materials in a good environment Social Safe, attractive workplaces and social wellbeing Drive development for responsible value chains Manage forestry and wood supply sustainably Promote commitment, safety and social standards for attractive workplaces Develop innovative and safe packaging solutions Environmentally adapt and develop resource-efficient production Support development initiatives for young people and society Deliver profitability that creates added value Environmentally adapt transport Work for ethical responsibility and human rights

6 SUSTAINABILITY CREDENTIALS TRANSPARENCY REPORTING, RECOGNITIONS AND LABELS "BillerudKorsnäs AB is recognized by WWF for leadership in transparency for disclosing their ecological footprint in the WWF Environmental Paper Company Index 2013." SUSTAINABILITY Report 2013 GRI G4 - Verified by EY ADVANCED LEVEL CDP INVESTORS CDP SUPPLY CHAIN CDP FORESTS GÄVLE, KARLSBORG CARTONBOARD SACK - QUICKFILL PIETARSAARI, TERVASAARI PULP PULP 5

7 WOOD SUPPLY AND MILLS Wood supply! Totally 10 mn m 3 solid! Import 1.4 mn m 3 solid Wood suppliers! Private forest owners! Forest companies! Sawmills 75% Wood fiber consumed (SE)! Karlsborg 1,5 mn m 3! Skärblacka 1,6! Gruvön 2,5! Rockhammar 0,2! Frövi 1,1! Gävle 2,9 Pietarsaari and Tervasaari (FI), and Beetham (UK) purchase 6 external pulp

8 WHAT IS EXPECTED FROM US AS A PULP SUPPLIER? HIGH AMBITIONS AND CREDIBLE ACTIONS! High quality - material for tissue based on thin-walled and slender fiber! Development in production! Development in the supply chain and deliveries! Transparency in performance reporting and labelling! High environmental performance! Externally assessed and ensured for pulp 2014! Energy, emissions, fiber, chemicals, waste 7

9 WHAT DOES A SUPPLY CHAIN LOOK LIKE? WOOD IMPORTS! Contracts with suppliers! Forest owners sell cutting rights! Contractors conduct logging! Companies transport by trucks to port! Companies transport by sea vessels to Sweden! Monitoring and register for certified volumes! Bank-book system for certification credits 8

10 IS CERTIFICATION THE ANSWER? STRUCTURE FOR PERFORMANCE AND IMPROVEMENT! Operations audited externally and internally! Risk analyses in order to avoid controversial sources! Illegal cuttings! High Conservation Value Forests! Areas with serious social conflicts! Forests with genetically modified trees (GMO)! Forests transformed to other use! Certified wood ensuring responsibility and sustainable growth 9

11 FOREST CERTIFICATION: THREE CORE VALUES ECONOMIC VALUES! Ensured regeneration! Quality selection! Optimized production! Sustainable growth ENVIRONMENTAL VALUES! High conservation values! Biodiversity! Water status SOCIAL VALUES! Workers rights! Multiple-use forestry! Recreation! Indigenous people 10

12 THE FORESTRY CYCLE Regeneration harvest at years of age Extraction of sawlogs, pulpwood and forest fuel Soil preparation and planting of seedlings ALTERNATIVELY Use of seed trees or sowing where appropriate Pre-commercial thinning 1-3 times Second thinning at years age Extraction of sawlogs and pulpwood First thinning at years of age Extraction of pulpwood 11

13 ANNUAL FOREST GROWTH AND LOGGING IN SWEDEN Million m Growth Harvesting Source: Swedish National Forest Inventory & Swedish Forest Agency L1

14 A SWEDISH CERTIFIED FOREST LANDSCAPE 5% forest land reserved 3 tall stumps per hectare Special consideration to threatened species 5-10% broad-leaf tree volume & dominated area 351 Non-productive land 5% burned areas on holdings larger than 5,000 hectares Conservation value trees, at least 10 trees/hectare Buffer zones around streams, key habitats & shorelines Sweden 45 Consideration to historical UK cultural sites Dead wood saved Charcoal kiln Seed tree stand High shelterwood on moist land

15 14 GROWING DEMAND FOR FSC PRODUCTS FORECAST % ! Product labelling an option to certified customers! Added value to the product! Market communication

16 RISKS AND CHALLENGES! GLOBALLY! Megatrends! Climate change! Shortage of resources! Global operations! LOCALLY! Environmental impact! Purchases in the supply chain! APPROACH FOR LOW RISK! Certification and external audits! 99.8% suppliers from Europe! Supplier evaluation procedures! Code of Conduct adapted to suppliers 15

17 CERTIFICATION AND SUPPLIER ASSESSMENTS THE ANSWER IS A BROAD APPROACH! Eight perspectives! Risk analyses! Self-audits! Improvement meetings (audits)! 40% of the value spent assessed during 2014! Wood supply! FSC Chain of Custody/Controlled Wood! EU Timber Regulation! Risk analyses and audits! The eight perspectives implemented

18 W e are convinced that the key to a bright future lies in renewable and sustainably produced raw materials. By challenging material that is a drain on the Earth s resources, we at BillerudKorsnäs want to make our contribution to a sustainable future. Economy Responsible business for products that add value in many ways Environment Renewable and sustainably produced materials in a good environment Social Safe, attractive workplaces and social wellbeing

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Forest Stewardship Council

FSC-certified forest in Wisconsin Courtesy of Potlatch Corporation Forest Stewardship Council FSC Certification as a Market-Based Tool to Improve Forest Management Forest Stewardship Council The FSC s