Everyone Wins When You Recycle Annual and Sustainability Report

ANNUAL AND SUSTAINABILITY REPORT

EVERYONE WINS WHEN YOU RECYCLE INTRODUCTION

THIS IS FTI

THE SWEDISH Packaging and Newspa- funds from the paper industry and rev- individual companies. In this report, you per Collection Service (FTI AB) has been enue from sales of collected and sorted can read more about how we have ex- collecting newspapers and packaging material. No dividends are paid to the tended the concept of producer responsi- for recycling on behalf of the business organization’s owners. bility and created an effective value chain sector for over 25 years. The nation- FTI is owned by five materials compa- together with our owners and stakehold- wide collection scheme is carried out nies – RK Returkartong AB, Svensk Plas- ers, based on our collection scheme. We via some 5,000 recycling stations and a tåtervinning i Motala AB, Svensk Glaså- are working together to further strength- large number of properties, totaling tervinning AB, Svenska Metallkretsen AB en the value chain with the goal that even 2 million households. The operations and Pressretur AB. In turn, the materi- more packaging waste will become new are financed by packaging fees paid by als companies are owned by retail and material, and to achieve our ambitious companies with producer responsibility, industry trade associations, as well as recycling targets.

2 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 MESSAGE FROM THE CEO

LARS PÅHLSON CHAIRMAN AND 901 INTERIM CEO, FTI AB SEK M IN SALES A different year

2020 WILL GO down in history as a very different year. A year when the COVID-19 pandemic swept in and brought challenges that few of us had ever expe- rienced before. In order to handle the increased load on our collection scheme, 64 5‚000 FTI was forced to make rapid adjust- KG PER PERSON NO. OF ments. Never before has so much pack- AND YEAR RECYCLING aging been collected, which required even greater flexibility in terms of emp- COLLECTED* STATIONS tying and cleaning. A requirement that we essentially managed to meet, despite the fact that the pandemic also affected our working lives, and that most of FTI’s employees were working from home. In accordance with two new ordinances adopted in 2018, we lodged an appli- 9‚000 cation to become a licensed collection AFFILIATED scheme with the Swedish Environmen- tal Protection Agency (EPA) in March. PRODUCERS In June, the EPA announced that all ap- (approx. 9,000) plications had been rejected, including ours. In October, the government announced that implementation of some *Applies to five types of material. parts of the new ordinances would be delayed. At the same time, the Swedish Ministry of the Environment launched an internal inquiry, which we welcome. As of 2021, newspapers will be exempt PRODUCER RESPONSIBILITY from producer responsibility and the responsibility for collecting newspapers Producer responsibility for newspapers and packaging was intro- will be transferred to municipalities. duced by the Swedish government in 1994, and means that anyone We have offered to cooperate around who produces, fills or places packaging on the market is also the existing collection scheme. These obligated to recover and recycle the packaging waste. changes had a major impact on our Since the introduction, producer responsibility has been subject to operations. However, together with our many public inquiries. In 2018, the Swedish government approved owners, the materials companies, we two new ordinances that would be implemented in stages from continued to offer high-quality collec- January 2019. In October 2020, the government decided to delay tion and recycling in 2020 with the aim some parts of the new Ordinance on Producer Responsibility for of meeting the new and tougher recy- Packaging. The Swedish Ministry of the Environment launched an cling targets. The Sustainability Report internal inquiry, which is expected to conclude in autumn 2021. is presented on pages 39-47, and is an important tool on the path toward greater circularity.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 3 CONTENTS 2020 IN BRIEF

THIS IS FTI 02 Our operations and our assignment. COLLECTION RECORD  In 2020, more packaging was collected than ever before. Changed behaviors in the wake of the pan- CEO STATEMENT 03 demic probably contributed to the record-high vol- A very different year. umes of packaging collected – 520,000 kg, or 50 kg per person. Read more on page 20. THE PAST YEAR 04 A look back on events in 2020. MORE EFFICIENT COLLECTION MARKET AND TRENDS PLANNING WITH AI 05 Trends – the new normal.  About 1,300 bins at recycling stations across Skåne and Halland have been equipped with sensors for data collection and analysis, with the aim of improving emp- STRATEGY 06 tying frequencies. Using sensor data, FTI is hoping to Key strategic steps for meeting the become even more accurate and to optimize its empty- recycling targets. ing schedule faster. Over time, digital technologies will make collection even more sustainable and efficient. FTI’S VALUE CHAIN 08 Producer responsibility holds the key to circularity. FLORA OF MANUALS COMPLETE  The plastic manual was launched in 2017, the paper manual shortly thereafter. There are now manuals for INFORMED DECISIONS 10 all four types of material – important tools that make Manuals are improving recycling. it easier for producers to develop more recyclable packaging. The manuals are produced on behalf of WHY WE CHOSE FTI each materials company. Read more on page 10. 16 Ice cream committed to sustainability. WASTE PAPER EXEMPTED FROM 18 PACKAGING IS ESSENTIAL PRODUCER RESPONSIBILITY Not a necessary evil.  In December 2020, the Swedish government decided that waste paper would be exempted from produc- 20 RECORD-HIGH VOLUMES er responsibility obligations. This means that respon- Major increase in collection volumes. sibility for newspaper collections will be transferred to municipalities, where FTI has offered to collaborate SAY YES TO RECYCLING via the existing collection scheme. 21 Young people believe in recycling. THE MATERIALITES’ WORLD IS 26 HIGHEST QUALITY GROWING High-quality materials for circularity.  The Material World was launched in autumn 2018 and FTI’s recycling kit for preschools was an immedi- CORPORATE GOVERNANCE ate success. The World was expanded in autumn 2020 29 and the Materialites moved into the homes of many SUSTAINABILITY REPORT families with activities for children who had to stay at 30 home, and to help take care of packaging piles. 31 DIRECTORS’ REPORT Read more on page 22. FINANCIAL INFORMATION NEW LABELS 32  A new joint Nordic label has now been launched SIGNATURES for all waste fractions. There is one system for the 36 entire customer journey – from purchasing to recy- AUDIT REPORT cling. A pictogram for each type of material is used 37 for packaging, and the pictograms are also used on bins at the recycling stations, in brochures and other SUSTAINABILITY REPORTING 39 information material. Labeling of the bins will com- mence in April 2021. 47 GRI CONTENT INDEX

4 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 BUSINESS ENVIRONMENT AND TRENDS

WHAT FTI DOES: One of FTI’s owners, Svensk Plas- tåtervinning (SPÅ) owns and operates the most advanced sorting facility in Northern Europe. Here in Motala, all of the plastic packaging collected by FTI is sorted 24 hours a day. The plastic manual issued by SPÅ and FTI provides guidance and information for producers about design that makes recycling easier. The packaging fees are differentiated. Plastic 2020the year when trends packaging that is easy to recycle costs less to place on the became the new normal market than packaging that is more complex. CLIMATE FOCUS Never before have such mas- FTI’s operations are grounded in reality and we sive monetary measures been introduced to stimulate the global must always stay tuned to signals from our economy than during the pandemic, alongside of a clear ambition business environment. That became even more for a sustainable restart. During this unique year, more Swedes apparent in 2020 when several of the trends that than ever before also felt hopeful and engaged in the future of the climate, and three of four want to live a more sustainable lifestyle have affected us over the years were strength- than they do today.² ened by the COVID-19 pandemic. Among other things, the pandemic led to a surge in e-com- WHAT FTI DOES: FTI’s assignment has been refined in line with merce and an even stronger interest in climate changing views on climate change and the environment. Our core, change and the environment. collection and recycling, has not changed, but together with our owners, we are more like the engine of a circular system – from collection via sorting and processing, to sales, placing materials on EXTREME E-COMMERCE GROWTH the market and waste separation. We have intensified our commu- In the wake of the pandemic, 2020 shut down the physical world and nication with consumers and use our Recycling Barometer to follow accelerated the pace of digital transformation. E-commerce grew changes in attitudes to recycling and gradual changes in behavior. from SEK 87 billion to SEK 122 billion, up 40 percent.¹ The industry has thereby become an established retail channel. The strongest PRODUCER RESPONSIBILITY retail goods were groceries, pharmaceutical products and home FOR THE FUTURE furnishings. E-commerce growth is increasing demand for packag- In June 2018, the Swedish government adopted two new producer ing materials and a considerably higher volume is being collected. responsibility ordinances for packaging and waste paper, which included the requirement for a license from the Swedish Envi- WHAT FTI DOES: In 2020, the volume of packaging collected ronmental Protection Agency (EPA) to run a collection scheme. reached an all-time high. The ability to offer clean, attractive and Following a government decision in September 2020, this require- accessible recycling stations has required a great deal of flexi- ment was delayed and in early 2021, the Swedish Ministry of the bility. The more packaging collected, the heavier the load on the Environment launched an internal inquiry to present a proposal for stations, which increases the need for more frequent cleaning and new packaging recycling provisions. Newspapers will be exempt emptying. FTI’s preparedness for handling peaks due to the in- from producer responsibility as of 2022 and transitional arrange- crease in e-commerce became more or less permanent through- ments will apply for packaging until December 31, 2022. out the entire year. Read more on page 20. WHAT FTI DOES: In March 2020, FTI applied to the EPA for a SEEING PLASTIC AS A VALUABLE RESOURCE license to run a packaging collection scheme. The application was While plastic is still controversial, it is increasingly being seen rejected in May and the EPA called for a review of the provisions of as a valuable resource. That is the starting point for the EU’s the new ordinance. FTI welcomes the public inquiry and during the Single-use Plastics Directive (SUP Directive), which is being im- transition period, our collection services will remain unchanged. plemented in stages during 2021, and where some products will Our hard work with the application provided invaluable insights, disappear and others will be redesigned or labeled. At the same which are strengthening our aim to achieve the greatest possible time, more and more fossil-based plastics are being replaced by environmental benefits by offering a flexible and sustainable renewable and recycled plastics and in 2020, the volume of plastic collection scheme. packaging collected rose from 7.9 to 8.7 kg per capita. ¹E-barometern, ²Swedes and Sustainability, Insight Intelligence

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 5 STRATEGY

Strategy to increase recycling FTI has developed producer responsibility and designed an increasingly efficient value chain based on a nationwide collection scheme. A flexible collection scheme, easier recycling due to more recyclable packaging, the steadfast pursuit of a circular economy and higher quality materials for circular flows. Four key steps for increasing environmental benefits, and for attaining and exceeding ambitious recycling targets.

1 2 Flexible and More recyclable accessible collection packaging

OVER THE PAST 25 YEARS, FTI has laid a solid TOGETHER WITH OUR owners, the materials com- foundation for the continued development of a flexi- panies, FTI would like to continue refining and devel- ble collection scheme. With 5,000 recycling stations With 5,000 oping the practical tools that are offered to produc- and curbside collection services for 2 million house- ers in their efforts to develop recyclable packaging. holds, we want to lead the design of tomorrow’s col- recycling Tougher requirements are not only the result of lection and recycling solutions. We would therefore stations and legislation. Higher consumer awareness and the like to contribute our experience and insights to the ambitious sustainability targets of producers are revision of the provisions for the Licensed Collection curbside driving the trend toward more packaging that is Scheme (LCS) in the 2018 ordinance. To be success- both possible and easy to recycle. And this is where ful in the long term, we believe that the ordinance collection FTI and our owners, the materials companies, have should be clearly formulated to ensure that the services for played an increasingly important role. Producers are recycling targets are achievable, that collection and increasingly contacting FTI for advice and support in recycling can be carried out cost-efficiently and sus- 2 million their design processes, and we can provide informa- tainably, that it does not hinder innovation, that cost households, tion about the changes that are required to im- control can be assured over time, that the collection prove recyclability and how they should think when scheme ensures high-quality materials and that we want to choosing materials and what is technically feasible. the costs and conditions for producer responsibility On behalf of the materials companies, we have pro- are competition-neutral between the companies in- lead the design duced four recycling manuals – one for each type of volved. At the end of 2020, the Swedish government of tomorrow’s material. The manuals are regularly updated to keep made a decision regarding producer responsibility pace with constantly changing technology. In addi- for newspapers. As of January 1, 2022, municipal- collection tion to the manuals, FTI keeps its more than 9,000 ities will be responsible for collecting newspapers and recycling affiliated producers informed via newsletters, virtual but FTI is willing to cooperate with the current and face-to-face visits, regular training sessions well-functioning system of recycling stations. solutions. and so forth.

6 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 3 4 Driving the transition to Higher quality a circular economy material for circular flows FTI WANTS TO BE INVOLVED in shaping the circular economy. We have therefore participated and actively ON BEHALF OF OUR OWNERS, the materials contributed to several research projects over the past The quality of companies, we are working for circular flows by few years, and been represented in the government’s the recycled ensuring high quality material. To raise recycling advisory body, the Swedish Circular Economy Delega- rates, more packaging must be collected. tion, since June 2020 via the CEO of Svensk Plaståter- material must But the quality of the recycled material must also vinning, Mattias Philipsson. The aim of the delegation be sufficiently be sufficiently high to compete with virgin is to help society transform to a resource-efficient, material. Otherwise, there is a major risk that it circular and bio-based economy, both nationally and high to com- will be used for energy recovery instead of regionally. The delegation is led by Axfood’s Sustain- becoming new products. The plastic sorting ability Manager, Åsa Domeij, and handed over its first pete with vir- facility in Motala is a pioneering step, along with report to the Swedish Minister for the Environment, gin material. the glass recycling facility in Hammar. But more Per Bolund, in mid-April. With the aim that all plastic is needed to achieve full circularity. Ensuring packaging should be recycled, Mattias Philipsson high-quality materials is therefore a priority for can contribute with experience to lay the foundation FTI and our owners, the materials companies. for policy instruments that can help to accelerate the Read more about the quality of materials transition to a circular economy. on page 26.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 7 FTI’S VALUE CHAIN

01 02

PRODUCER PACKAGING PACKAGING DESIGN USE RESPONSI- AND FTI supports producers MANUFACTURE in their efforts to BILITY better understand how It must be possible to the design of packaging affects FOR CIRCU- recycle the packaging that is consumer behaviour, and LARITY placed on the Swedish how the packaging is market. To make that easier used and recycled. for producers, FTI offers We analyze trends and Reduced CO2 training, manuals and advice conduct behavior emissions, more about design for recycling. surveys and similar. Customer meetings climate-smart and seminars are arranged packaging or on a regular basis. improved recyclability. Whatever sustainability targets you are aiming for, 01 we can guide you 01 all the way to 05 02 circularity – from design and manu- 05 02 facture, to 04 recycling. 03

04 03 Read more about use on pages 18-19. Read more about design and manufacture on pages 10-17.

8 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 03 04 05

PACKAGING QUALITY NEW PRODUCTS COLLECTION AND CONTROL FROM SEPARATION OF COLLECTED RECYCLED Households and companies MATERIALS MATERIALS are obligated to separate their Through our owners, When FTI has collected packaging waste. FTI trains he materials companies, the material, we ensure and inspires consumers in FTI can offer producers – together with our waste separation and recycling traceability all the way from owners – that the highest via information campaigns collection and baling to sorting proportion possible is and by running programs for and recycling. We perform recycled. Our owners are also schools and preschools. FTI’s regular pick analyses and responsible for monitoring and emptying and cleaning continuously check the driving the development contractors are an integral part quality of materials to ensure of technologies and of the operations. We offer the highest recycling processes, and stimulating training in safety procedures, rates possible. higher demand for recycled and keep track of our fuel con- material. By participating sumption and carbon in research projects, emissions. for example, FTI is helping to shape tomorrow’s circular economy.

01 05 02

05 02

05 02 04 03

04 03 Read more about quality control on pages 26-27. 04 03 Read more about collection on pages 20-25. Read more about recycling on page 28.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 9 PACKAGING 01 DESIGN AND MANUFACTURE

Recycling manuals enable informed decisions PLASTIC, METAL, PAPER AND GLASS. After three years of hard work, there are now four manuals with clear advice on how to make more packaging recyclable. “This is just the beginning,” says Anette - Löhnn, Marketing Manager at FTI.

Where did you get the idea to produce a manual PRACTICAL for each type of material? ASSISTANCE “We were getting lots of questions from producers Anette Löhnn, Marketing Manager – what can we do to make our packaging recyclable? at FTI, sees At the same time, one of our owners, Svensk Plas- the manuals as tåtervinning (formerly Plastkretsen), was wondering effective tools what they should be doing to help producers. I guess for working you could say that coincided with the need for com- together with producers. prehensive information.” How did you start? “We started by spreading 10 clear tips, and demand just grew. Because of the plastic debate and the fact that the new plastic sorting facility was opened in Motala in 2018, the plastic manual was launched first.” What was the response to the manuals? Did it meet your expectations? “We didn’t know whether our advice would be considered a lecture, or support for producers. The first seminar where the manuals were presented was a mixture of horror and delight. But it soon became clear that we could help producers in their sustainability efforts.” What is the most important message? “The most important question is why materials aren’t being reused. Recycling is more than just collection, it also requires sorting and processing.” What’s the best thing about the manuals? “Our manuals can help producers make informed

10 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 MAGNUS ANDERSSON, INGRID CEO SVENSK NÄSSTRÖM, decisions about the design of their packaging. Per- GLASÅTERVINNING CEO RETURKARTONG form a life-cycle assessment of your packaging. And 1 Our biggest problem is the 1 I put all my eggs in one keep asking FTI for advice. The more we learn from band from seals, such as the basket – smart design. The each other, the more accurate our advice will be.” ring left around the neck of a recyclability of packaging Is there any way to measure the effects bottle when you take off the is determined when the of the manuals? closure, and that is difficult to packaging is designed. If “We don’t have access to detailed information at remove. You shouldn’t need a plastic is needed to protect toolbox to remove the whole the product, put a plastic bag present, such as how many black trays have been re- closure. There are alternatives in the cardboard box. Then placed by non-colored trays and are now recyclable, for – procure a new solution. both materials can be sorted example. But in addition to phasing out black trays, the 2 Avoid adhesive-backed correctly. manuals have initiated quite a few other changes such stickers, the glue is not wa- 2 Sometimes multi-material as less printing ink on bread bags, a gradual reduction ter-soluble and cannot be dis- packaging is required to keep of the proportion of mixed materials, and so on.” solved. That makes the bottle food safe and sustainable. How are the manuals used? difficult to recycle. Choose multilayer laminates 3 Do not give the bottle a col- so the materials can be “Mainly when producers are choosing new packag- or, by spraying them with paint recycled. ing solutions and they need to specify their require- for example. It is not possible 3 Only packaging that is sent ments for packaging contractors. They are also a tool to recycle a painted bottle. Our for recycling can have a new when working together with us at FTI – in workshops, camera-based separators will life. Increase the odds by for example. They help to raise the awareness of both identify it as stone or porcelain making it easy to empty and producers and FTI.” and remove it. flatten the packaging. How much practical assistance can FTI offer producers, in addition to the manuals? What three tips from the “As a customer of FTI, you can take part in workshops, and you can contact our materials specialists recycling manual for your type of for advice about your specific type of packaging and how it could be made more recyclable. We can also material are most important? support your efforts to promote recyclability among packaging suppliers.”

“Since technology is continuously evolving, the change process PETER TRIMMEL, MATTIAS PHILIPSSON, CEO SVENSKA CEO, SVENSK must never stand still. METALLKRETSEN PLASTÅTERVINNING 1 Our biggest challenge in 1 First of all, I would replace It must be reflected in the collection is the excessive my black plastic packaging amount of contaminants, with transparent packaging. the manuals which, in 15 percent is not metal. To That would reduce CO2 emis- avoid waste, I would recom- sions from packaging by up to turn, will drive the mend designing packaging 50 percent. Since transparent with materials that are easy packaging development process.” to sort. is recyclable, I would 2 Also make it easier to also be lowering my packag- How will the manuals be developed? separate materials in the ing fee. recycling process. Separate 2 I would also use recycled “Since technology is continuously evolving, the the unwanted material from plastic in my packaging to change process must never stand still. It must be re- aluminum or steel packaging. reduce my environmental flected in the manuals which, in turn, will drive the A glass jar with a metal lid, impact. development process. That is why they are updated for example, is very easy to 3 Finally, I would avoid mix- every year.” separate. ing different types of packag- Is there anything equivalent to FTI’s manuals in 3 Use steel or aluminum, but ing materials and plastics in other countries? avoid combinations of both. the same packaging. “I think we were first to go the whole way, but more countries have begun to follow suit over the past two years.”

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 11 PACKAGING 01 DESIGN AND MANUFACTURE

CLIMATE-SMART “FTI helped us rethink,” says Sofia Abadi, Sustainability Manager at IDUN Minerals, a company with a strong commitment to recycling.

SUSTAINABLE BATHROOMS We are much better at sorting our waste in the kitchen to compromise – lipstick tubes, for example. “The amount of material must be pro- than in the bathroom. Powder compact cases, face portionate to the contents, it should be ‘just cream jars and mascara containers, half of it is just enough’ packaging material. We hope we can explain to customers why lipstick tubes thrown in the bin. It’s time for a change, according to made from recyclable and light materials IDUN Minerals. 75 percent of the company’s are better for the environment.” IDUN Minerals has used light colors on packaging is now recyclable. its new packaging, which feels fresh and modern. And makes it easier to recycle. It’s CONSUMERS HAVE an old habit of just “FTI helped us rethink. I also visited the also in line with the brand’s keywords: sim- throwing bottles and jars away. Multi-ma- plastic packaging sorting facility in Motala ple, clean and sustainable. terial packaging and black or dark plastic. to see how the process works. I’ve learnt so But regardless of how recyclable packag- “There was quite a bit of work to be done much during this period.” ing is, it still has to be sorted. IDUN Miner- to improve waste sorting in the bathroom,” It’s not always right, and it’s also difficult, als is therefore working to raise consum- said Sofia Abadi, new Sustainability Man- to avoid plastic. Many products are made er awareness and change people’s habits. ager at IDUN Minerals, a Swedish-owned from liquids, plastic is often the only mate- Partly by informing how cosmetic packing company that sells hypoallergenic cosmet- rial that works. should be sorted, but also by rewarding ics in pharmacies. “However, we can move towards mono- those consumers who sort their bathroom “Sweden is good at recycling compared to materials, and using more recycled and products for recycling. many others countries, but we can be better. bio-based plastics.” Through the collaboration with Bower, The cosmetics industry needs to wake up and The limited range of recyclable packag- IDUN Minerals’ packaging is traceable. All make it possible to recycle the packaging.” ing was another challenge. Cosmetic pack- consumers need to do is download an app, 75 percent of IDUN Minerals’ packaging aging is designed to catch the eye, to attract and then collect points by scanning their is now recyclable. The next target is 85 per- consumers looking for luxury and glamor. empty products at the closest recycling sta- cent. Packaging after packaging is being re- “Cosmetic packaging often comprises a tion. 25 deposit points gives a 25 percent designed. metalized part and other decorations that discount on a purchase. Sofia Abadi began by contacting Einar Ahl- make it difficult to recycle. It’s difficult to “Our packaging has only been traceable ström, materials specialist at FTI. A contin- get hold of simple, lighter mono-material for three months, but customers are al- uous dialog and FTI’s plastic manual laid the packaging.” ready loving it. We hope we can continue to foundation. For some packaging, IDUN has been forced reward them for sorting their recyclables.”

12 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 FTI SPECIALIST

“WE SEE OURSELVES BJÖRN ANDERSSON, AS A LINK BETWEEN ACCOUNT MANAGER PRODUCERS AND FTI BJÖRN ANDERSSON now spends USERS” most of his time answering questions from customers, but he had a very different role when he started Founded in 1959, Tingstad is and higher customer demand. working at FTI just over six years ago. “In 2020, we took a further step and “At that time, we spent most of our now a market leader in sev- launched Klimatkompassen®,” says Jo- time following up how much each eral niches, including pack- hanna Ossiansson (the Climate Compass). producer reported and most of my “Together with the Research Institutes discussions were with controllers and aging. But this family-owned of Sweden (RISE), we have calculated the nearly always initiated by us. Now my company is more than that. carbon footprint of our single-use foodser- colleagues and I are contacted by the vice products and assigned each product a companies’ sustainability managers “Sustainability is a basic unique compass value using algorithms with requests for support and advice principle for us,” says Head of based on large amounts of data, where re- on the best way to meet their produc- cyclability is one of the metrics.” Klimat- er responsibility obligations.” Environmental Sustainability kompassen® helps customers make sustainable choices that don’t require their What questions do they ask? Johanna Ossiansson. own research or any particular knowledge. “Well, there are still a lot of ques- In addition to Klimatkompassen®, Ting- tions about fees, about reported WE OBTAINED ISO certification 25 years stad has also introduced a new feature – volumes and how to calculate them ago. This laid the foundation for proac- Make your shopping cart more sustainable correctly, but all of these questions tive sustainability efforts, even though – on their website. are usually related to an overall de- ‘sustainability’ was a lesser known con- “You place your order on our webstore sire to do the right thing, and the best cept than it is today. Tingstad’s efforts to and in your shopping cart, you’ll see sug- way to approach packaging in terms achieve ISO certification included environ- gestions for an equivalent but more sus- of recycling. It’s all connected.” mental and quality management cours- tainable alternative to the product you’ve es for all employees. But the company’s ordered.” How can you and FTI help when it engagement with climate change and the comes to design and similar issues? environment stretched far beyond its own Since packaging accounts for a large “In this area, I work with my col- organization. proportion of your range, how do you leagues and most of all with FTI’s “We engage both suppliers and custom- work together with FTI? materials specialist, Einar Ahlström. ers in our advocacy,” says Johanna Os- “We maintain a close dialog with FTI, es- In a normal year, I would probably siansson. “Our activities are part of a larg- pecially when it comes to legal issues such meet about 70 companies, either in er value chain, where we see ourselves as as the EU’s Single Use Plastic Directive. groups, individually in workshops or a link between producers and users.” But we often contact FTI for assistance with in separate reviews, to discuss every- Tingstad’s range includes about 70,000 specialized knowledge and advice about thing from what producer responsi- items with a focus on consumables, work choice of materials and recyclability – when bility involves to how you should think clothes and workplace equipment where we are bringing in new products, for exam- about materials. Over the past year, cleaning products, hygiene paper and of- ple. We take part in seminars and work- most of these activities have taken fice supplies are some of the products, as shops and have visited both SPÅ in Motala place remotely. It’s not unusual for well as packing materials and packaging. and Fiskeby Bruk outside Norrköping.” us to engage in continuous dialog A demanding range of products when it throughout a design process. Our comes to compliance with the company’s Do you use the design manuals? recycling manuals are particularly own sustainability policy, which requires “Absolutely! We distribute them through- useful here.” offering a wide range of eco-friendly al- out the organization, especially to our FTI currently has four account ternatives. Tingstad has therefore been sales organization so they have access to managers who support our affiliat- gathering climate-smart and sustainable the latest information about packaging ed producers, and both actively and products in a separate department, A More materials and design, and can then pro- reactively inform potential customers Sustainable Choice, since 2014. This range vide credible answers to questions from about their producer responsibility has grown in line with increased supply our customers.” obligations.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 13 PACKAGING 01 DESIGN AND MANUFACTURE TOMORROW’S PACKAGING The future of packaging and recycling will not be what we think it will be. Milk packaging might go back a few years in time, while plastic will continue to evolve. FTI’s materials specialist Einar Ahlström presents his view of what the future could hold for each type of material.

Where do we stand today in terms of Is there any future for PET plastic? plastic packaging? “PET plastic is perfect for bottles because it is infinite- PLASTIC “The focus has shifted from rely recyclable. But it’s not that great for trays because ducing sizes and amounts to talking black PET can’t be recycled and even non-colored trays about recycling and recyclability, are problematic. They are currently burnt at energy re- which is very encouraging.” covery plants. We may have to switch to other materials What is the most important factor for increasing that are easier to produce and recycle.” recycling? “The choice of design. There’s a lot more to do here. What kind of packaging will be used You just have to walk into a supermarket to see the poten- for milk in 20 years’ time? tial for improvement, like avoiding dark colors and dyed PAPER “Very similar to what we use today, plastics that are difficult to recycle and reduce the value When we’ve but maybe go back a few years instead. of materials. The same for printing – too much ink and reached the 20 years ago, we lifted up a folded color printing also makes plastic difficult to recycle.” pouring spout or tore off a corner. Where will we be in 20 years’ time? point where Then plastic screw caps were introduced. We’ve started “By then, we may have developed chemical recycling all packag- to use more plastic, but we have to wind back the clock. to complement the mechanical methods we use today. ing can be Mixed materials always make recycling more difficult.” The chemical process will break down plastics to their recycled, What can be done to increase plastic and simplest components, and convert them into a raw ma- paper recycling? terial for new packaging or objects.” then we “Recycling processes don’t have enough capacity for Are there any research projects that are testing chem- can raise both plastic and paper packaging. They will have to be ical recycling? the bar for expanded if we want to continue using liquid packaging.” “Yes, the Collaborative Chemistry Cluster in the materi- Will it be possible to make bottles from Stenungsund is running a chemical recycling project. al.” 100% recycled paper? The aim is to turn recycled plastic into a material similar “I don’t think so. The first generation of paper bottles EINAR AHLSTRÖM, to fossil oil. The benefits will be huge if it works. Unfor- MATERIALS are actually plastic bottles covered with paper. There are tunately, the process is cost and energy-intensive.” SPECIALIST, FTI several examples of packaging where an outer layer of Will plastic still be used as a packaging material? paper has been placed over the plastic and marketed “Absolutely. Despite the debate on the bad points of with the claim that the percentage of renewable mate- plastic, we’re using more and more. Plastic is a wonder- rials is higher. Consumers are led to believe they are ful material. It’s more energy-efficient to produce than making a climate-smart choice, but it’s not actually the other materials and reduces food waste. Not all plastic best solution for recycling.” can be replaced by other materials.” Will fossil-based plastic be phased out? What does the future hold for “It’s not necessarily true that bio-based material re- glass and metal? duces GHG emissions. You have to see the bigger picture. METAL “I think we’ll continue using glass What are the growing conditions, how much fertilizer is & GLASS and metal in much the same way as needed, what source of energy is used in the manufactur- today. There is no reason to choose ing process? If it’s coal power, there’s no guarantee that any other materials from a recycling bioplastics are better for the environment.” point of view.”

14 FTI ÅRS- OCH HÅLLBARHETSREDOVISNING 2020 What’s next when we meet our “We need a more intelligent discussion on how we can current recycling targets? use the recycled materials. Can we use them in the con- WHAT’S “When we’ve reached the point struction or automotive industries, or to make house- NEXT? where all packaging can be recy- hold products like cleaning materials and furniture?” cled, then we can raise the bar for the material and start sorting plastic PACKAGING by color, and using filtration to remove residues from 2 WILL BE A CLIMATE HERO labels and other contaminants. But higher quality also assumes even higher demands on the design of the IN THE FUTURE, packaging will no longer be seen as a packaging we collect.” necessary evil. What new laws can we expect moving forward? “Packaging guilt will disappear,” says Per-Stefan “If we don’t meet our current targets, there is a major Gersbro, who foresees an environmental debate based risk that legislators will start making demands on how There won’t on facts rather than feelings. packaging is designed. That’s why producers need to un- be any When consumers no longer feel packaging guilt, derstand that they have to continue changing the design packaging producers won’t have to waste any more time on gre- of their packaging so that more and more packaging can guilt in the enwashing. In the future, it will go without saying that be recycled. Otherwise it will be mandated.” packaging protects food and is crucial if we want to future. reduce food waste, secure our food supply chains and, in PER-STEFAN the long term, combat climate change. GERSBRO, CEO “Packaging will be a climate hero, especially for de- THREE RECYCLING TRENDS PACCEDO veloping countries,” says Erik Lindroth. Packaging that knows whether the drink is hot or cold? Edible plastic? Self-counting and SMARTER LOGISTICS AND 3 RECYCLING self-driving packaging? We asked two sustainability experts to predict the future. They EDIBLE PACKAGING. Milk cartons that communicate with the fridge. That’s usually a popular prediction about see three clear trends. the future. Intelligent packaging will lead to a revolution. But not the way you think, say our futurists. 1 FEWER MATERIALS MAKE “75 percent of all packaging is used for food, where RECYLING EASIER prices are under pressure. There’s not much scope for ONE PARTICULAR ISSUE is more important than any- raising them,” says Per-Stefan Gersbro. thing else,” says Erik Lindroth, Sustainability Director at Traceable packaging that verifies the product’s origin Duni Group. Materials claims is about to arrive on a broad front. Also pack- “Materials are so important that all other issues pale are so aging that shows how safely the food has been stored in significance.” during transport to the supermarket. In a couple of decades, we won’t be using virgin fossil-oil important “But edible packaging is really just a gimmick, the based raw materials for packaging anymore. We will have that all primary function of packaging is to protect the food. And partially replaced them with plant-based materials. other is- that can’t be compromised,” says Erik Lindroth. “By then we will also have far fewer base materials, sues pale Intelligent packaging technologies will revolutionize which will make it easier to recycle them in their own in signifi- collection, sorting, separation and recycling. cycle,” says Per-Stefan Gersbro, who has been working “Intelligent systems will increasingly be used for sort- in the packaging industry for 30 years and is now CEO cance. ing, analyzing and separating materials,” says Per-Ste- of Paccedo. ERIK LINDROTH, fan Gersbro. SUSTAINABILITY “Packaging will be seen as a resource, a raw material DIRECTOR “Transport will also be revolutionized, to deliver prod- that’s also used to make other products. But to reach AT DUNI GROUP ucts to the right address without burning too much fossil that point, we have to focus more on how we can redirect fuel. We can’t keep sending packages one at a time like material flows,” says Erik Lindroth. we do today.”

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 15 PACKAGING 01 DESIGN AND MANUFACTURE

Ice cream you can trust Slöinge in Halland is home to one of Sweden’s best-known brands. SIA Glass is produced here, just a stone’s throw from sister companies dating back to the 16th century. At least 14 generations have farmed the land around Berte Quarn and Berte Gård, and sustainability is firmly embedded in the company culture. “You reap what you sow,” says Sustainability Manager Helena Stenström.

16 FTI ÅRS- OCH HÅLLBARHETSREDOVISNING 2020 FOR MORE THAN 450 YEARS, Helena Sten- Ice cream you ström’s family has been farming the land around Slöinge. They have taken care of animals, milled grain and made ice cream. can trust “When the Farmers’ Cooperative closed down an abattoir in the early 1960s, my grandfather took over the premises and started making ice cream to keep jobs in Slöinge. We also made gummy candies and rusks during the winter for a few years, but we don’t do that anymore,” says Helena Stenström. We continued making ice cream – under contract at first, but soon under our own management.” SIA Glass is now part of the Berte Group, which employs a total of 170 people, many “Sustainable enterprise is based on the of whom have relationships with the company spanning many generations. ability to develop, and to identify new and “Working with such loyal and dedicated employees has many advantages,” says smarter ways to run a business.” Helena Stenström. “You become agile, dare to try new things and are less afraid of the tubs that were made from a blend of in light colors, which is good for recycling. making mistakes.” plastic and paper, despite introducing them In 2021, we have therefore decided to fo- A culture where soft values are em- fairly recently,” says Helena Stenström. cus on information campaigns about how bedded in everything the company does, “They’re difficult to handle in production the empty container can be used and why combined with curiosity and a willingness and aren’t optimized for recycling.” it should be sent for recycling. But that to change, has laid the foundation for sus- Does that mean you have reverted to doesn’t mean that our development activ- tainability efforts. plastic packaging for a large part of the ities to find an alternative to plastic have range? stopped. On the contrary.” “Yes, several analyses showed that You haven’t been affiliated with FTI plastic is the best solution right now. The for very long. Why did you choose FTI? Helena main purpose of packaging is to protect the “It was basically access to a nationwide and Stenström, ice cream and minimize waste, but recy- well-functioning collection scheme, but we Sustain- clability is also important from a life-cycle are also looking forward to fruitful collabo- ability Man- ager at SIA perspective. We also know that our plastic ration around packaging development, and Glass. tubs are often re-used to store food or being able to benefit from FTI’s expertise. other items. In addition, the tubs, lids and We have already attended remote semi- labels are all made from monomaterials nars, which has been very rewarding.”

“Sustainable enterprise is based on the ability to develop, and to identify new and smarter ways to run a business,” says Hel- ❚ On behalf of FTI’s owners, the materials companies, we offer a range of services ena Stenström. 01 One of the long-term sustainability within the framework of design and manu- targets is to halve CO2 emissions by 2030, facture. We want to make it easier for you to increase the recyclability of your packaging compared with 2018. SIA Glass is helping to 05 02 by offering: achieve this target by using raw materials ADVICE: We can guide you through all from Sweden wherever possible. stages of the design process. Contact us “These are usually produced with higher for advice and tips, download the recy- environmental and ethical considerations cling manuals from our website, and stay and we also prioritize deliveries of milk and informed with our newsletter. cream from suppliers who are striving to 04 03 TRAINING: FTI arranges regular seminars and training courses together with the become fossil-free diversity farms. That’s materials companies, the EPA and other good for the climate as well as biodiversi- ABOUT PACKAGING stakeholders. ty,” says Helena Stenström. ADVOCACY: We promote your interests by Packaging is also at the top of the agen- DESIGN AND taking part in delegations and research da and in 2020, the focus was on plastic. MANUFACTURE projects, and by analyzing trends. “As well as phasing out all black plastic packaging, we also decided to stop using

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 17 02 PACKAGING USE

HELÉN WILLIAMS HAS BEEN RESEARCHINGpack- aging and food waste for many years. With some THE KEY ROLE OF hesitancy, she would like to defend not only packaging, but also plastic packaging. “We need to focus more on how packaging plays a PACKAGING key role in preventing food waste. The carbon footprint of packaging is relatively low compared with Packaging is not a necessary evil food waste.” The role of packaging is to protect the product – it plays a key role in reducing our during transport, to extend the life of the product and to make it easier for consumers to do the right carbon footprint. thing when it comes to sorting their recyclables. “We have to look at the entire “Packaging should be optimized, not minimized,” says Helén Williams. “In order to design smarter packaging and how it affects our packaging, we need to know more about how the properties of packaging affect consumer behavior behavior,” says packaging researcher all the way from the supermarket to the recycling Helén Williams. station.” Helén Williams has been involved in several inter- disciplinary projects and studied method and analysis together with researchers in the fields of both business administration and psychology. “How consumers behave has a major impact on the system, so you can’t ignore that factor.” Helén Williams’ two consumer studies on food waste show clearly that we throw a lot of food away unnecessarily because of the design of the packaging. The packaging is too big, we buy more than we need. “As long as it costs less to buy two-for-one or family-size packs, it will be difficult to persuade consumers to think more about the environment.” We need more variation. Not all packaging has to be designed for big families or parties. “It’s usually better that households buy several

18 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 small packs than one large pack that doesn’t get finished.” The packaging should be easy to empty, especially viscous products like yogurt. Too much of these products is being wasted. But the most important thing is probably to know about the product’s total CO2 emissions. “For onions and potatoes, for example, the pack- We need to focus more on how aging can have a negative effect on the product’s total carbon footprint, compared with cheese and meat packaging plays a key role in where the environmental impact of the packaging is relatively low in relation to the actual product.” preventing food waste. The According to Helén Williams, consumers would carbon footprint of packaging is rather not have any packaging at all, and especially not plastic. relatively low compared “This has urged producers to spend a lot of time coming up with new materials and reducing the with food waste. amount of plastic, which is an important step. But when you are standing in the store and deciding what to buy, there aren’t many people who think “It shouldn’t take more than a few seconds to about whether the packaging is recyclable or not.” know what to do, but the more fractions, the more We usually only look at the actual product or complex it gets. Crème fraîche is one example what we are going to use it for. We don’t think about where the container is sent to recycling, while the lid how the packaging should be sorted for recycling and seal ends up as household waste.” until it’s empty. The absolute biggest obstacle to further development is a general resistance to packaging. People don’t understand that packaging is needed to protect food. SIZE “The industry has an important role to play here MATTERS Food in large packs is more by communicating that packaging can be good for likely to be thrown away the environment and that plastic can also be a good because we buy more than we choice if it’s collected and recycled. Why not use the need or can eat. actual packaging to communicate the message?” With new tough recycling and environmental objectives, we can no longer lean back and think we know what consumers want. “We have to study and understand behavioral patterns, and then take all of the consequences into account,” says Helén Williams.

❚ Together with our owners – the 01 materials companies – we can make it easier for producers to better understand how packaging design can affect both consumer 05 02 behaviour and how the packaging is used, quite simply. We can help you by providing: INFORMATION: We can support your efforts to explain and promote the important role that 04 03 packaging plays in reducing environmental impacts. LABELS: FTI can help you label ABOUT your packaging to make it easier PACKAGING USE for consumers to sort it correctly.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 19 COLLECTION 03 AND SEPARATION OF PACKAGING

600,000 COLLECTION VOLUMES

500,000 520,006 400,000 423,824 RECORD-HIGH 300,000 COLLECTION 200,000

100,000 VOLUMES 0 2020 was a record year for collection 2016 2020 volumes. Many of us were working 2,500,000 EMPTYING* from home, we ate more meals at 2,000,000 2,159,704 our own kitchen table and purchased more goods online.Changed behaviors 1,500,000 1,645,204 during the COVID-19 pandemic were 1,000,000 probably the reason for record-high

500,000 levels of emptying, cleaning and, most

0 of all, collected volumes.

2016 2020 THE TREND IS CLEAR. In recent years, the volumes of collected packaging *Applies to paper, plastic and metal packaging. have gradually increased, which has led to more frequent cleaning and emptying, and required more preparation ahead of holidays and summer vacations.

600,000 The pandemic put even more pressure on Sweden’s approximately 5,000 re- CLEANING OPERATIONS cycling stations. On average, every person in Sweden sent 50 kg of packaging 500,000 to recycling in 2020 and the volume collected was almost 520,000 metric tons. 470,918 517,772 “We broke all records,” says Veronica Foberg Gustafsson, Director of Com- 400,000 munications. “During the pandemic, a fundamental shift in consumer behaviors has become even clearer and online shopping is now a way of life. And it 300,000 is gratifying that recycling habits seem to be following these changes.”

200,000 IN 2020, the volume of collected packaging corresponded to a few million recycling bins and they were emptied nearly 2.2 million times, which is 200,000 100,000 times more than in 2019, and a 30 percent increase compared with 2016. The logistics around emptying, cleaning and snow clearing are the lifeblood 0 of FTI’s operations. Together with our contractors, we are laying the founda- 2016 2020 tion for an effective collection and recycling scheme. Emptying and cleaning is a machine that just has to work, 365 days per year. Clean, safe and or- CONSUMER CONTACTS derly stations are essential for well-functioning collection and recycling. This makes demands on the contractors who are working on FTI’s behalf. And that

60,000 makes demands on FTI. “We work continuously and intensively to adapt our operations to new be- 56,211 haviors and habits,” says Fredrik Gemfors, Head of Collections at FTI. “De- spite the fact that the increase coincided with the outbreak of the pandemic, 40,000 45,690 we managed to adjust without any serious disruptions.” But the growing volumes also increase the risk of dumping. And to work more systematically with the serious littering and the stations that are par- 20,000 ticularly affected, we are now developing a new tool and new procedure have been created. The tool is based on a range of metrics, including litter levels obtained from cleaning reports and contact with the general public. In 2020, 0 the number of cleaning operations was 517,772, which also shows a steady 2016 2020 increase in recent years.

20 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 YOUNG PEOPLE AND RECYCLING “CLIMATE ACTION IS

NAME: Vincent IMPORTANT Bjurberg. AGE: 21. OCCUPATION: Musician and TO US” parish instructor.

Many young people are passionate about climate change and the environment, NAME: Freja but what do they think Hammar. AGE: 19. about recycling? OCCUPATION: FTI interviewed two young Student. Stockholmers to hear their views on sorting packaging.

THE SUN WAS SHINING in a clear blue “I still live at home and leave most of Vincent thinks for a while before he sky when Freja Hammar (19) and Vincent that responsibility to my parents, but I answers. Bjurberg (21) met outside Vincent’s music know I’ll be more actively involved when I “I don’t want to sound arrogant, but I studio to speak about recycling. Both con- move out. It’s still something that I think is feel like a know a lot. I do agree with Freja sider themselves fairly typical of the people important.” though, I didn’t learn anything about recy- they know and that recycling is generally cling in school.” important for their generation. So you are interested. Do you think you “Recycling has always been an issue for have proper knowledge about recycling? Many young people are passionate about us, unlike our parents and grandparents,” “Yes, I think so,” says Vincent, and adds: climate action, do you think recycling says Vincent. “I know that black plastic can’t be re- plays a role here? cycled, that you shouldn’t sort envelopes “Climate action is really, really im- So you think you are good at sorting your together with newspapers, and that chip portant,” they reply in unison, and then packaging for recycling? bags are plastic and not metal.” Vincent says, “Yes, I’m pretty good actually. My girl- “Mm, I didn’t know that about black “I think that recycling definitely helps the friend and I have a good system for sorting plastic! I thought I knew a lot, but probably climate. At the same time, recycling a milk and we live close to a recycling station, have lots to learn,” says Freja and laughs. carton can feel like a drop in the ocean which makes it easier,” says Vincent. He compared with the huge emissions from explains how he used to live in student Would you like to learn more industry.” housing with no space for sorting and a about recycling? Freja nods in agreement and adds: long way from the closest recycling station. Freja answers quickly with a big smile: “And when you see how bad other coun- He thinks the practical aspects have really “I would definitely like to learn more! It’s tries are at recycling.” helped to made recycling a habit. one of those things we didn’t learn much She pauses for a moment, and then adds: Freja laughs a little sheepishly when it’s about in school, which is a bit strange, “But hopefully we can be role models for her turn to answer. really.” the rest of the world.”

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 21 PACKAGING 03 COLLECTION AND SEPARATION

music and the game,” says That also resonates with Sophia, while she and the chil- Veronica Foberg Gustafsson’s ‘Snorkul’ dren log into view. The Material World on their “What we saw in preschools recycling mobile phone to show us. is how involved the children “Let me, let me!” cry Lykke become and how much fun What can you do when the children and Emilia together when the they have. Our aim is that their are at home sick and the pile of pack- game starts up and its time to enthusiasm will spread like feed the hungry Materialites ripples on water and get the aging is growing higher and higher? with packaging. whole family involved.” Get the children to play recycling! They obviously love the game, despite the difference in AND THAT SEEMS TO be their ages. It keeps them occu- exactly what’s happening for pied for quite some time, while the Wikbro family. While her also teaching how glass, plas- big sisters are playing, Wilma tic, metal, paper and cardboard picks up an empty egg carton THE BRICK HOUSE in Vendelsö Foberg Gustafsson, Director of go into different places. from the table. She puts it on is a hive of activity. Emilia, 7, is Communications at FTI. The idea is that they can use her head first, but then de- sitting very concentrated, while The new kit contains a story, this knowledge to sort their cides to put it in the recycling Lykke, 4, plays Hot Lava with a game, a song and a music waste at home. And they do, bin with the other cardboard cushions on the living room video, created to entertain, according to Sophia. boxes. Then she looks around floor and Wilma, 2, laughs as while also teaching how we can “We were probably pretty to see whether her mother, she climbs in and out of her contribute to a more sustain- good at sending our packaging Sophia, was watching. She was highchair. Their mother, So- able environment. to recycling before, but The watching and gives a thumbs- phia, is a children’s nurse, but “The most popular parts Material World has made it up. A proud smile spreads she takes parental leave every for our family have been the much more fun!” across Wilma’s face. second Friday to look after her youngest daughters. “We call it ‘parental service’,” she says with a laugh, “because that’s a better de- scription.” Over the past year, the family has been at home with sick children as well as on their days off, like many others. “The difference now thought is that we’ve had to stay at home for even the slightest sign of a cold, so we’ve often been at home when the kids are fairly active,” says Sophia. And the ‘Snorkul in the Ma- terial World’ campaign is for those very occasions – a saving grace when children and their parents have had to stay at EDUCATIONAL home. GAME “The Material World began The Wikbro family as an educational initiative in Vendelsö has been using The Material for preschools, but when the World to learn more COVID-19 pandemic broke about recycling. out, we decided to develop the material to help parents keep their not-so-sick children oc- cupied at home,” says Veronica

22 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 FTI SPECIALIST

MIA STEINBACH REGIONAL MANAGER FTI

WHEN JOURNALISTS in Örebro or Värmland need information about collection statistics or the cleaning of recycling stations, Mia Steinbach is the person they call. But the role of Regional Manager at FTI involves much more than communicating with the media. HOW CAN WE HELP YOU TO “In a nutshell, my colleagues and I are responsible for all contact with RECYCLE MORE? municipalities and landowners. We make decisions about all matters Everyone needs a little reminder, and to learn more about the related to the design of the collection right bins for our used packaging. That is the scheme in the actual municipality.” outcome of FTI’s annual surveys on collection and recycling. What kind of matters arise? “We have a major responsibility to spread knowledge “Anything from supervisory issues and help promote behavioral changes,” says Veronica Foberg and the location of recycling stations to building permit processes. The Gustafsson, FTI’s Director of Communications. ultimate goal is to maintain the highest quality possible – that recycling DOING THE RIGHT THING should be easy. “More and more people are finding it stations are kept in good condition, Of course, you might say, but how easy is relatively easy to sort their packaging for and are clean and safe. Information it to sort your recycling? It might become recycling, even though there’s a big is important. As a municipal resident, clearer if we turn it around Doing the difference between the various types of you need to know when a station has wrong thing should be difficult. The material and there is still much to be been relocated or removed, or when closer recycling moves to individuals, the desired,” says Veronica Foberg Gustafsson. a new station has been added. Which more responsibility can be demanded According to FTI’s annual survey (the is why a Regional Manager needs to from consumers. Recycling Barometer), a lack of space at have good contact with the media.” home sometimes prevents us from sorting more. At the same time, collection How does FTI work with A SELECTION OF volumes have reached an all-time high municipalities? COMMUNICATION this year because most people have spent “Engaging in close dialog with the ACTIVITIES more time at home. municipalities is essential for running IN 2020: an efficient collection scheme. We ❚ Continuation of the consumer IN OTHER WORDS, we are pretty good at collaborate under the framework of campaign ‘Everyone wins when sorting our recyclables in Sweden. 97 partnership agreements or usu- you recycle’ with exposure on percent sort their recycling, and eight of ten fruct agreements. We hold annual public transport. are satisfied with their recycling solution. consultation and maintain regular ❚ New videos about the recycling “That is a fantastic result and confirma- contact about all kinds of issues. The process for all types of material. tion that our efforts have been effective, municipalities are the regulators ❚ Sorting guides that are continuously updated. but that doesn’t mean we can rest on our and responsible for allocating land ❚ Recycling brochure. laurels, we still need to increase the and issuing building permits – or the ❚ Expanded version of ‘The amount of packaging we collect and development – while FTI handles the Material World’ teaching kit for recycle. That’s why it’s so important that establishment and operation.” preschool children. we keep inspiring, communicating and FTI now has eight Regional Man- ❚ A new labeling system building trust,” says Veronica Foberg agers who are responsible for the was created. Gustafsson. “In addition, the Recycling same number of regions throughout ❚ Broad media presence. Barometer has revealed a desire to learn Sweden, and represent 290 munici- more about the benefits of recycling.” palities.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 23 PACKAGING 03 COLLECTION AND SEPARATION THE RECYCLING JOURNEY A milk carton becomes a pizza box, your jam jar comes back as an olive oil bottle, and the shampoo bottle is now a flowerpot. And used bottle caps are converted into raw material for car bodies. Follow the recycling journey of packaging.

IN SWEDEN: 1 5,000 RECYCLING STATIONS STORE 2 MILLION 2 3 HOUSEHOLDS HAVE ACCESS TO CURBSIDE 2 COLLECTION 5 4 RECYCLING FACILITY

17%

45% COLLECTED KG PER PERSON COLLECTION RATE The recycling 2020 journey GLASS 22.6 KG continues on 94% 79% page 26. 34% PAPER 16.9 KG PLASTIC 8.7 KG 47% 80% TOTAL 50 KG METAL 1.8 KG

1. Products are bought and on a daily basis, but sometimes packaging is sent to SPÅ in Hammar and either driven to used. The empty packaging is several times a day. Motala, where it is sorted and glassworks, or used to make left over. 4. At the waste transfer sta- rebaled for transportation, glass wool or foam glass aggre- 2. The packaging is dropped in tions, balers pre-sort the waste. and then washed, ground into gate. Aluminum and steel are the respective bins in the recy- Each type of material, except pellets and sold as raw mate- separated with a huge magnet cling room or recycling station. metal, is compressed into sepa- rial. Paper packaging is used and driven to ironworks and 3. The material is picked up by rate large bales. to make new cardboard at a aluminum smelters, where they collection trucks and driven to 5. The bales are transported paper mill outside Norrköping. are smelted and cast into steel waste transfer stations. Usually to a recycling facility. Plastic Glass packaging is crushed in bars and aluminum ingots.

24 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 FTI SPECIALIST

MORE HOMES ARE SEPARATING THEIR WASTE 2 million Swedish households can now drop off their used packaging close to where they live. NIKLAS GYLLENSTIERNA, LOGISTICS OPERATIONS And that number will rise. “Expanded Curbside MANAGER FTI Collection (CC) services are essential if we want to reach our recycling targets,” says Ulrika NIKLAS GYLLENSTIERNA became Eliason, Product Manager for CC at FTI. Operations Manager at FTI just over a year ago, and nothing has been the CURBSIDE COLLECTION SERVICES are vices, like collection via recycling stations, same since. Planning and respon- continuously being rolled out and since are provided on behalf of our owners, the sibility for emptying the bins is now early 2021, have reached more than two materials companies, who in turn take a whole new ballgame. The pan- million households. That means that care of the packaging in their facilities, demic has changed nearly every- about 40 percent of the Swedish popula- which guarantees environmentally sound thing. Niklas and his colleagues now tion can now leave their packaging in a recycling. perform competitive intelligence and multi-compartment recycling bin at the In June 2018, the Swedish government contemporary analysis on an every- curbside, or in a residential recycling adopted a new ordinance for producer re- day basis. ACCESS TO CURBSIDE room in the building where they live. For sponsibility with an obligation to increase “FTI has long experience in pack- many people, CC services have increased accessibility, with an objective to signifi- aging collection. We have established accessibility which, in turn, is lowering cantly expand curbside collection ser- routines, functioning processes and the threshold for regular recycling. vices. The framework was a Licensed Col- a large amount of data to rely on. “According to a survey we conducted lection Scheme, which should have been We know how people usually behave jointly with SIFO, 86 percent of the re- introduced in January 2021. That has now during vacations and weekends, spondents who live in multi-family homes been put on hold and in February 2021, and how that affects the collection say that CC services have made it easier the Swedish Ministry of the Environment frequency. But now I also have to for them to sort their recyclables,” says announced it would be launching a new keep track of the changing pandemic Ulrika Eliason. inquiry into producer responsibility which restrictions and how they can affect In multi-family homes, the property is expected to conclude in autumn 2021. recycling.” owner or tenant-owner association is re- A decision is expected in spring 2022. But sponsible for hiring a contractor to collect that does not mean that the expansion of What does that mean in practice? the packaging waste. For single fami- CC has stalled. “It means you have to change your ly homes, the municipality collects the “The CC services are essential for plans quickly and maintain even waste or outsources the collection meeting our recycling targets,” says closer dialog with our contractors. to a contractor. Curbside collection ser- Ulrika Eliason. You have to know the exact capacity of each one, and where you can find extra resources, often at very short notice. It’s also a challenge to meet ❚ Packaging and newspaper collections an expanded need while also staying have been FTI’s core business for more 01 within the number of collections per- than 25 years and we can now offer: mitted, in regard to noise levels, for A FLEXIBLE COLLECTION SCHEME: example.” We deliver a flexible, nationwide and 05 02 sustainable collection scheme via our 5,000 recycling stations and curbside In 2020, collection volumes hit an collection services that reach two million all-time high. Have you seen any households. signs of a slowdown now in 2021? CONSUMER INFORMATION: We provide “No, the trend has continued. information about waste separation and There’s more and more to collect, 04 03 recycling to inform and inspire consum- especially e-commerce packaging, ers via information campaigns and other which seems to have exploded now initiatives for schools and preschools. that so many people are working from ABOUT PACKAGING TRAINING: We provide training for our emptying and cleaning contractors in home, and don’t live near, or want to COLLECTION AND safety procedures, fuel consumption and go shopping in, physical stores.” SEPARATION carbon emissions. FTI now has four operations managers who are responsible for logistics in a specific geographic area.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 25 QUALITY CONTROL 04 OF COLLECTED MATERIALS

CONSUMERS CAN ALSO HELP: OF HIGHEST QUALITY ◗ Don’t throw anything in the packaging recycling bins except packaging. ◗ TOGETHER WITH its owners, FTI is working continuously to ensure the Separate packaging with several quality of the recycled material. These measures range from pick different types of material. ◗ analyses and visits to baling and sorting facilities to making demands Sort materials correctly on collection contractors, and most of all, to providing information – refer to FTI’s sortingguide at and advice to consumers and producers. The aim is to create incentives www.ftiab.se for assistance. for continuous quality improvement. The higher the quality of the recycled material, the greater the potential for circularity and that the material will be used to make new products. That is why the packaging fee is lower for packaging that is recyclable, and where the material can be sold and become new products. PLASTIC PACKAGING

HOW PRODUCERS CAN RAISE THE QUALITY OF COLLECTED MATERIALS:

◗ Do not use black plastic. METAL ◗ Use plastic that is recyclable. PACKAGING ◗Reconsider the material used for the label. ◗ Reduce the amount of print.

◗ Use steel or aluminum, What does the collected What actually happens avoid combinations. metal packaging contain? ◗ Avoid copper and zinc. to plastic packaging? ◗ Minimize the use Steel packaging of tin. 44% ◗ Limit the use of 55% recycled Aluminum packaging various alloys. ◗ Make it easy to separate 25% 15% is recycled under certain the various types of material. Other metal products circumstances ◗ Limit the use of anything that is not steel or 15% aluminum. Waste 31% becomes energy ◗ Design packaging with materials that are easy to 15% identify.

26 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 PAPER PACKAGING

GLASS PACKAGING

◗ Design packaging with materials ◗ Use water-soluble adhesives that are easy to identify. for labels. What actually happens to ◗ Use paper (mono material) ◗ Avoid wrapping bottles in jute, glass packaging? wherever possible, i.e. without metal mesh or similar. a window or cork. ◗ Avoid seals where a ring remains

◗ 60% Avoid mixed materials. around the neck of the packaging becomes new ◗ Design the packaging so that it’s after opening. glass packaging easy to empty and compress. ◗ Avoid porcelain corks and ◗ Avoid chemicals to metal clips (German beer bottles). 25% increase wet strength. ◗ Avoid glued medallions becomes glass wool ◗ Avoid greaseproof paper. made from porcelain or any ◗ Reduce the amount of glue and other ceramic material. 15% adhesives. Use a watersoluble ◗ Avoid opaque layers of color. becomes foam glass aggregate adhesive. If you need a hot-melt adhesive, use heatresistant varieties. ◗ Ink and printing inks must be free from mineral oil You can read more about our recycling manuals on page 6, and download more comprehensive information from our website www.ftiab.se hydrocarbons (MOH).

❚ 01 On behalf of our owners, the materials companies, we ensure that the collected material maintains the highest-possible What does the collected quality. FTI’s quality checks include paper packaging contain? 05 02 the following: PICK ANALYSES: FTI conducts pick anal- Corrugated fiberboard yses of the collected material to obtain an adequate assessment of how well the 48% collection scheme is working. We visit Liquid packaging board baling and sorting facilities to inspect the 04 03 quality of deliveries and materials. 10% TRAINING: We arrange field trips to Other paper packaging the facilities for producers, municipalities ABOUT QUALITY and others. 22% INFORMATION: We support consumers Other than paper packaging CONTROL OF by providing sorting guides and other 20% COLLECTED MATERIALS information.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 27 NEW PRODUCTS 05 FROM RECYCLED MATERIALS COLLECTION RATES IN SWEDEN 2016-2020 0 20 40 60 80 100

PAPER 80%

PLASTIC 42%

2016 METAL 78%

GLASS 93%

PAPER 80%

PLASTIC 40%

2017 METAL 81%

GLASS 93%

Everyone PAPER 75% wins PLASTIC 42% 2018 when you METAL 82% recycle GLASS 93% WASTE SEPARATION and recycling PAPER 73% are now firmly established in Sweden. More packaging than ever was col- PLASTIC 44% lected in 2020, and collection vol- 2019 METAL 96% umes hit an all-time high during the COVID-19 pandemic. The collection GLASS 93% rate is rising, especially for plastic packaging which has risen five percentage points since 2016. PAPER 79% The collection rate (formerly known PLASTIC 47% as the material recovery rate) shows the proportion of packaging 2020 METAL 80% placed on the Swedish market that has been collected. The collected GLASS 94% material has then become new raw material or been used for heating and energy. While Sweden is generally one of the top recyclers in Europe, the ❚ Together with our owners – the materials comparisons have faltered, and the 01 companies – we are responsible for ensur- EU’s guidance for measuring recycling ing that the collected material is used to rates has to date been open to inter- make new products. This means that we: pretation. The EU therefore introduced DRIVE PROGRESS: FTI and each of the 05 materials companies are leading and driv- stricter requirements in the 2018 02 ing the development of technologies and waste directives, and energy recovery processes to increase recycling rates. will no longer be included in the re- ENABLE TARGET ACHIEVEMENT: FTI cycling statistics. Only materials that works across a broad front to achieve can be converted into new products new and tough recycling targets through and replace virgin raw material will 04 03 expanded collection services, better quality be counted. On pages 39, 41 and 46 materials, information for consumers, advice for producers, and so forth. of our Sustainability Report, you can ABOUT NEW PRODUCTS FACILITATE: We help producers meet their read more about the new method for producer responsibility obligations, via calculating the recycling rate, and how FROM RECYCLED collection and recycling but also by report- Sweden is one of the first countries in MATERIALS ing to the EPA on their behalf. Europe to adopt this ‘new’ method of measurement.

28 CORPORATE GOVERNANCE

FTI’S BOARD OF DIRECTORS

LARS PÅHLSON MAGNUS ANDERSSON, INGRID NÄSSTRÖM Chairman and CEO, Svensk CEO RK Interim CEO, FTI AB Glasåtervinning AB Returkartong AB

MATTIAS PHILIPSSON PETER TRIMMEL DANIEL JACOBSSON CEO Svensk CEO Svenska Employee representative, Plaståtervinning i Motala AB Metallkretsen AB Akademikerna at FTI

Employee representative, deputy Carolina Landerdahl, Akademikerna at FTI

OWNERSHIP STRUCTURE AT DEC 31, 2020 Owners who hold more than 10 percent of the company’s shares: 20% 20% 20% 20% 20%

RK Retur- Svensk Plaståter- Svensk Glasåter- Svenska Metall- Pressretur kartong AB vinning AB vinning AB kretsen AB AB

THE MATERIALS COMPANIES’ OWNERS:

DLF (Dagligvaruleverantörers Förbund), Svensk Handel AB, Svensk Dagligvaruhandel, DS Smith Packaging AB, Elopak AB, Fiskeby Board AB, Holmen AB, Korsnäs AB, SCA Obbola AB, Smurfit Kappa Kraftliner AB, Smurfit Holdings AB, Stora Enso Packaging AB, Stora Enso Skoghall AB, Svenska Kartongförpackningsföreningen, Tetra Pak Sverige AB, PIR (Plast- branschens InformationsRåd), Holmen Paper AB, SCA Forest Products AB, Stora Enso Hylte AB, Ardagh Glass Limmared AB, Sprit & Vinleverantörsföreningen, Sveriges Bryggerier

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 29

SUSTAINABILITY REPORT

FTI is required to prepare a sustainability report pursuant to the Swedish Annual Accounts Act. Sustainability data based on the disclosure requirements contained in the Swedish Annual Accounts Act are presented on the following pages:

BUSINESS MODEL AND VALUE CHAIN 2, 8-9

RISKS AND RISK MANAGEMENT 31, 40, 41

ENVIRONMENT 45, 46

SOCIAL CONDITIONS AND EMPLOYEES 44, 46

HUMAN RIGHTS 43

ANTI-CORRUPTION 42-43

RECYCLING 28, 41, 46

THE AUDITOR’S REPORT ON THE STATUTORY SUSTAINABILITY REPORT To the general meeting of Svenska Förpacknings- och Tidnings- insamlingen AB, corporate, identity number 556665-4090.

ENGAGEMENT AND RESPONSIBILITY The Board of Directors is responsible for that the statutory sustainability report as above has been prepared in accordance with the Annual Accounts Act.

THE SCOPE OF THE AUDIT Our examination of the statutory sustainability report has been conducted in accordance with FAR´s auditing standard RevR 12 The auditor´s report on the statutory sustainability report. This means that our examination of the statutory sustainability report is different and substantially less in scope than an audit conducted in accordance with International Standards on Auditing and generally accepted auditing standards in Sweden. We believe that the examination has provided me us with sufficient basis for our opinions.

OPINION A statutory sustainability report has been prepared. Stockholm, May 27, 2021

Andreas Nyberg Authorised Public Acoountant

30 FTI ANNUAL AND SUSTAINABILITY REPORT 2020

DIRECTORS’ REPORT

THE BOARD OF DIRECTORS and CEO of Svenska Förpacknings och Tidnings- insamlingen AB (FTI), with its head office in Solna, Sweden, hereby present the Annual Report for the 2020 fiscal year. The Annual Report has been prepared in Swedish kronor (SEK).

INFORMATION ABOUT THE OPERATIONS Svenska Förpacknings- och Tidningsinsamlingen AB (FTI) develops and provides coordi- nated schemes for the collection and recycling of newspapers and packaging on behalf of companies with producer responsibility. The operations are conducted on behalf of the materials companies – Svensk Plaståtervinning i Motala AB, RK Returkartong AB, Svenska Metallkretsen AB, Pressretur AB and Svensk Glasåtervinning AB – and are carried out under own management or via contractors. FTI supports the materials companies by offering various modules that they can opt to engage FTI for, as an alternative to performing the work under own management. On behalf of Svensk Plaståtervinning i Motala AB, RK Returkartong AB and Svenska Metallkretsen AB, FTI sells producer responsibility services to companies with producer responsibility for packaging. This assignment also includes informing producers about producer responsibility for packaging, assisting with registration and reporting data to the EPA, and providing information and advice about more recyclable packaging.

SIGNIFICANT EVENTS DURING THE FISCAL YEAR The year was characterized by the effects of the COVID-19 pandemic. FTI noted a sharp increase in the volume of packaging collected. Our collection scheme was seriously challenged by the 15 percent increase. Despite the sharp increase in volumes, however, FTI succeeded in delivering in line with its performance metrics for both quality and costs. Despite a highly competitive environment, FTI acquired several new customers during the year due to the wide geographic reach of our collection scheme. CEO, Håkan Ohlsson, stepped down in 2020. The recruitment of a new CEO is under way. Chairman of the Board, Lars Påhlson, is the Interim CEO. It was confirmed during the year that only FTI-affiliated producers are entitled to capacity at FTI’s recycling stations. As a result, the supervisory authority (the EPA) is currently determining whether certain producers, who are not FTI-affiliated, are providing the most appropriate collection scheme in accordance with the currently applicable ordinance.

EXPECTED FUTURE DEVELOPMENT AND SIGNIFICANT RISKS AND UNCERTAINTIES The long-term effects of the pandemic are difficult to predict. The scheme’s high volumes have continued and we see no indication of a decline. At the time of writing, Förpacknings- och Tidningsinsamlingen AB’s operations are running smoothly. In early 2021, Pressretur sold its shares in FTI. However, the company is still one of FTI’s customers.

SUSTAINABILITY REPORTING FTI also publishes a non-financial report compiled in accordance with Swedish legislation on sustainability reporting. The report has been published and is available on FTI’s website (www.ftiab.se).

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 31 FINANCIAL INFORMATION

MULTI-YEAR SUMMARY (SEK 000S) BALANCE SHEET 2020 2019 2018 2017 ASSETS NOTE DEC 31, 2020 DEC 31, 2019

Net sales 901,532 874,851 851,560 725,282 Non-current assets

Operating profit 65 113 123 82 Intangible assets

Total assets 316,696 235,584 255,877 187,305 Licenses 4 2,220,232 2,798,904

Profit after financial items 60 106 118 114 Ongoing development activities 7 386,652 0 and advance payments on intangible assets Equity/assets ratio (%) 0.2 0.3 0.2 0.3 2,606,884 2,798,904 No. of employees 56 64 60 51 Tangible assets

Equipment 5 3,664,128 5,823,350 CHANGE IN EQUITY Financial assets SHARE ACCUMULATED PROFIT TOTAL CAPITAL PROFIT OR LOSS FOR THE YEAR Other non-current 8 56,835 56,835 securities Opening amount 100,000 539,000 5,640 644,640 Total non-current assets 6,327,847 8,679,089 Appropriation as per 5,640 -5,640 0 the year’s Annual General Meeting Current assets Profit for the year 21,951 21,951 Current receivables Closing amount 100,000 544,640 21,951 666,591 Trade receivables 160,412,303 113,685,351

Tax assets 2,901,281 2,675,099

PROPOSED APPROPRIATION OF PROFIT Other receivables 3,026,448 6,981,864 THE BOARD PROPOSES THAT TO THE FOLLOWING UNAPPROPRIATED FUNDS (SEK): Prepaid expenses and accrued 9 14,250,890 51,135,708 Profit brought forward 544,640 income

Profit for the year 21,951 180,590,922 174,478,022

566,591 Funds 10, 11 8,693,289 453,791

Be carried forward 566,591 Cash and bank balances 12 121,083,742 51,973,253

Total current assets 310,367,953 226,905,066 The company’s earnings and otherwise financial position are presented in the following in come statement, balance sheet and cash-flow statement with additional disclosures. TOTAL ASSETS 316,695,800 235,584,155

INCOME STATEMENT BALANCE SHEET NOTE JAN 1, 2020 JAN 1, 2019 EQUITY AND LIABILITIES NOTE DEC 31, 2020 DEC 31, 2019 -DEC 31, 2020 -DEC 31, 2019 Equity 13.14 Net sales 901,532,308 874,850,843 Restricted equity Other operating income 855 19,803 Share capital 100,000 100,000 901,533,163 874,870,646

Operating expenses Unrestricted equity Other external costs 1, 2 -836,178,061 -817,198,426 Profit brought forward 544,640 539,000 Personnel expenses 3 -62,139,678 -54,642,726 Profit for the year 21,951 5,640 Amortization of intangible 4 -578,672 -2,822,195 assets 566,591 544,640

Depreciation of tangible assets 5 -2,572,055 -2,532,757 Total equity 666,591 644,640

-901,468,466 -874,757,806 Current liabilities

Operating profit 64,697 112,840 Trade payables 110,059,028 87,054,470

Other liabilities 1,131,384 1,000,849

Profit from financial items Offset liabilities 11 116,943,305 79,298,710

Other interest income and -4,697 -6,914 Accrued expenses and 15 87,895,492 67,585,486 similar profit items deferred income

Profit after financial items 60,000 105,926 Total current liabilities 316,029,209 234,939,515

TOTAL EQUITY AND LIABILITIES 316,695,800 235,584,155 Profit before tax 60,000 105,926

Tax on profit for the year 6 -38,049 -100,286

Profit for the year 21,951 5,640

32 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 CASH-FLOW STATEMENT REVENUE RECOGNITION NOTE JAN 1, 2020 JAN 1, 2019 Revenue is measured at the fair value of the consideration re- -DEC 31, 2020 -DEC 31, 2019 ceived or receivable. This means that the company recognizes revenue at nominal value (billed amount) if the company receives Operating activities consideration in cash equivalents immediately upon delivery. Profit after financial items 64,697 112,840 Deduction are made for discounts. Adjustment for non-cash 16 3150 727 2,916,654 items NON-CURRENT ASSETS Interest paid -4,697 -6,914 Intangible, tangible assets and financial assets are measured at Tax paid -264,231 -1,787,920 cost less accumulated amortisation or depreciation and

Cash flow from operating activities 2,946,496 1,234,660 impairment losses. before change in working capital Intangible and tangible assets are depreciated/amortized according to plan over the asset’s useful life less any residual value. The following depreciation periods are applied: Cash flow from change in working capital icenses: 5 years. Equipment: 5 years.

Change in current receivables -14,126,216 24,078,889 LEASES Change in current liabilities 81,089,694 -20,298,262 The company recognizes all leases as operating leases. Lease Cash flow from operating activities 69,909,974 5,015,287 payments under an operating lease are recognized as an expense over the lease term on a straight-line basis.

Investing activities INCOME TAXES

Investments in intangible assets -386,652 0 Current tax Current tax refers to income tax for the current fiscal year and the

Investments in tangible assets -412,833 -4,768,944 portion of the previous fiscal year’s income tax not yet recognized. Current tax is calculated using the applicable tax rate at the

Cash flow from operating activities -799,485 -4,768,944 balance-sheet date.

Cash flow for the year 69,110,489 246,343 Deferred tax Deferred tax is income tax payable in future fiscal periods due to past events. Deferred tax is recognized using the balance-sheet Cash and cash equivalents, Jan 1 method. According to this method, deferred tax liabilities and as- Cash and cash equivalents, Jan 1 51,973,253 51,726,910 sets are recognized as the temporary differences arising between

Cash and cash equivalents, Dec 31 121,083,742 51,973,253 the carrying amount and tax base of assets and liabilities, and carried forward tax losses and credits.

EMPLOYEE BENEFITS Employee benefits refer to all types of compensation that the Notes company pays its employees. ACCOUNTING AND MEASUREMENT POLICIES Benefits include salaries, paid vacation, paid leave of absence, bonuses and post-employment benefits (retirement). Benefits are GENERAL INFORMATION recognized as they are earned. The Annual Report has been prepared in accordance with the Swedish Annual Accounts Act and BFNAR 2012:1 POST-EMPLOYMENT BENEFITS Annual Report and Consolidated Statements (K3). The company only has defined-contribution retirement plans. Receivables are recognized at the amounts that are Defined-contribution plans are classified as plans in which a fixed expected to flow to the company. fee is paid and there is no obligation to pay further contributions Other assets and liabilities are recognized at cost, unless other- besides these fees. Fees for defined-contribution plans are recog- wise specified. nized as an expense in the period in which the benefit is earned by Receivables and liabilities denominated in foreign currencies the employee. are recognized at the closing-day rate. Currency exchange gains and losses on operating receivables and liabilities are recognized in operating profit, while currency exchange gains and losses on financial receivables and losses are recognized as financial items. The accounting policies are unchanged compared with the preceding year.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 33 FINANCIAL INFORMATION

CASH-FLOW STATEMENT NOTE 3 EMPLOYEES AND PERSONNEL EXPENSES The cash-flow statement is prepared using the indirect method. 2020 2019 The recognized cash flow only includes transactions resulting in Average no. of employees inflows and outflows of cash and cash equivalents. In addition to cash, the company classifies cash and cash equiv- Women 27 30 alents as deposits with banks and other credit institutions, as well Men 29 34 as short-term liquid investments that are listed on a trading venue 56 64 and have a maturity of less than three months from the date of Salaries and other remuneration acquisition. Changes in blocked funds are recognized as investing Board and CEO 2,024,250 3,134,032 activities. Other employees 36,824,235 32,212,498

DEFINITIONS OF KEY PERFORMANCE MEASURES 38,848,485 35,346,530

Net sales: Operating income, invoiced costs, incidental income Social security expenses and revenue restatements. Pension costs for Board and CEO 467,827 618,096 Operating profit: Profit after amortization/depreciation and items affecting comparability, but before financial income and expense. Pension costs for other employees 6,125,760 5,562,797 Total assets: The company’s combined assets. Other statutory and contractual social security contributions 11,786,905 11,437,935

Equity/assets ratio (%): Adjusted equity (equity and untaxed re- 18,380,492 17,618,828 serves less deferred tax) as a percentage of total assets. Total salaries, remuneration, social security expenses 57,228,977 52,965,358 No. of employees: Average number of employees during the fiscal and pension costs year. Gender distribution among senior executives

Women on the Board 15% 17% NOTE 1 LEASES Lease payments for the year amounted to SEK 4,622,416 Share of men on the Board 85% 83% (4,312,266). Share of women among other senior executives 44% 50%

Future lease payments, for non-cancelable leases, are due for Share of men among other senior executives 56% 50% payment as follows: NOTE 4 LICENSES 2020 2019 DEC 31, 2020 DEC 31, 2019

Within 1 year 4,243,050 3,741,169 Opening cost 2,893,363 0

Between 1 and 5 years 5,020,121 7,471,164 Purchases 0 2,893,363

9,263,171 11,212,333 Closing accumulated cost 2,893,363 2,893,363

The company has entered into the following material leases, Opening amortization -94,459 0 which are recognized as operating leases: Amortization for the year -578,672 -94,459 ALD Automotive AB – cars Fastighets AB Lysios – office premises Closing accumulated amortization -673,131 -94,459 Closing carrying amount 2,220,232 2,798,904 NOTE 2 AUDITORS’ FEES Audit assignment refers to audits of the annual report and NOTE 5 EQUIPMENT accounts, as well as the administration of the Board of Directors DEC 31, 2020 DEC 31, 2019 and CEO, other duties incumbent upon the company’s auditor to Opening cost 29,085,901 27,210,320 perform, and advice or other assistance arising from observations during such audits or the completion of such other duties. Purchases 412,833 1,875,581 Sales/disposals -9,850,462 0

ERNST & YOUNG AB 2020 2019 Closing accumulated cost 19,648,272 29,085,901

Audit assignment 177,498 250,497

Other services 369,996 484,600 Opening depreciation -23,262,551 -20,440,356

547,494 735,097 Sales/disposals 9,850,462 0

Depreciation for the year -2,572,055 -2,822,195

Closing accumulated depreciation -15,984,144 -23,262,551

Closing carrying amount 3,664,128 5,823,350

34 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 NOTE 6 CURRENT AND DEFERRED TAX NOTE 11 OFFSET LIABILITIES TAX ON PROFIT FOR 2020 2019 DEC 31, 2020 DEC 31, 2019 THE YEAR Liability to the materials companies offset 108,250,016 78,844,919 PERCENT AMOUNT PERCENT AMOUNT by packaging fees in December. Not paid.

Current tax 38,049 100,286 Liability to the materials companies offset by 8,693,289 453,791 packaging fees in December. Not transferred. Total recognized tax 38,049 100,286 116,943,305 79,298,710 RECONCILIATION OF EFFECTIVE TAX NOTE 12 PLEDGED ASSETS Recognized profit before tax 60,000 105,926 NAME DEC 31, 2020 DEC 31, 2019 Tax at applicable tax rate 21.40 -12,840 21.40 -22,668 Rental guarantee 810,000 810,000

810,000 810,000 Non-deductible expenses -25,209 -77,562

Non-taxable income -56

Recognized effective tax rate 63.42 -38,049 94.68 -100,286 NOTE 13 NUMBER OF SHARES AND QUOTIENT VALUE NAME NO. OF SHARES QUOTIENT VALUE

NOTE 7 ADVANCE PAYMENTS ON No. of Class A Shares 100 1,000

INTANGIBLE ASSETS 100 DEC 31, 2020 DEC 31, 2019 Ongoing projects related to digital contract 386,652 0 NOTE 14 APPROPRIATION OF PROFIT OR LOSS management PROPOSED APPROPRIATION OF PROFIT 386,652 0 THE BOARD PROPOSES THAT THE FOLLOWING UNAPPROPRIATED FUNDS (SEK):

Profit brought forward 544,640 NOTE 8 OTHER NON-CURRENT SECURITIES Profit for the year 21,951 DEC 31, 2020 DEC 31, 2019 566,591 Opening cost 56,835 56,835 Be carried forward 566,591 Closing accumulated cost 56,835 56,835

Closing carrying amount 56,835 56,835

NOTE 9 PREPAID EXPENSES AND ACCRUED INCOME NOTE 15 ACCRUED EXPENSES AND DEC 31, 2020 DEC 31, 2019 DEFERRED INCOME

Prepaid expenses 1,936,291 1,635,087 DEC 31, 2020 DEC 31, 2019

Accrued income, collection 8,772,705 46,607,664 Accrued expenses, collection 76,125,295 58,618,403

Accrued annual fees 3,330,000 2,801,500 Accrued vacation pay 5,521,728 5,837,708

Other accrued income 211,894 91,457 Accrued social security contributions 1,035,203 883,713

14,250,890 51,135,708 Accrued social security contributions on pensions 3,102,551 1,499,485 Other accrued expenses 2,110,715 746,177 NOTE 10 FUNDS 87,895,492 67,585,486 DEC 31, 2020 DEC 31, 2019 NOTE 16 ADJUSTMENT FOR NON-CASH ITEMS Packaging fees paid, not transferred to 8,693,289 453,791 the materials companies DEC 31, 2020 DEC 31, 2019

8,693,289 453,791 Amortization/depreciation 3,150,727 2,916,654

3,150,727 2,916,654

NOTE 17 SIGNIFICANT EVENTS AFTER THE END OF THE FISCAL YEAR At the beginning of 2021, Pressretur sold its shareholding in Svenska Förpacknings- och tidningsinsamlingen. The shares were purchased by the remaining owners. No other significant events occurred after the balance-sheet date.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 35 SIGNATURES

SIGNING OF THE FINANCIAL STATEMENTS

The Board of Directors and the CEO attest that the annual accounts have been prepared in accordance the Swedish Annual Accounts Act (1995:1554) and General Recommendation BFNAR 2012:1 Annual Accounts and Consolidated Financial Statements (“K3”) of the Swedish Accounting Standards Board. The annual accounts give a true and fair view of the financial status and financial results of the Company. The Management Report for the Company provides a true and fair view of the development of the Company’s business operations, financial position and financial results, as well as the significant risks and uncertainties faced by the Company. The Annual Report also contains the Company’s sustainability reporting in accordance with the Swedish Annual Accounts Act, Chapter 6, Section 11, see page 30, and the Sustainability Report in accordance with the Global Reporting Initiative, GRI, see the GRI index on page 47.

STOCKHOLM, MAY 26, 2021

Lars Påhlson Chairman, Chief Executive Officer

Magnus Andersson Ingrid Näsström

Mattias Philipsson Peter Trimmel

Daniel Jacobsson

Our Audit Report was submitted on May 27, 2021. Ernst & Young AB

Andreas Nyberg Authorized public accountant

36 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 AUDITOR’S REPORT

REPORT ON THE ANNUAL ACCOUNTS

To the general meeting of the shareholders not express any form of assurance conclu- counts as a whole are free from material of Svenska Förpacknings- och Tidningsins- sion regarding this other information. misstatement, whether due to fraud or amlingen AB, corporate identity number In connection with our audit of the error, and to issue an auditor’s report that 556665-4090. annual accounts, our responsibility is includes our opinions. Reasonable assur- to read the information identified above ance is a high level of assurance, but is not OPINIONS and consider whether the information is a guarantee that an audit conducted in ac- We have audited the annual accounts of materially inconsistent with the annual cordance with ISAs and generally accepted Svenska Förpacknings- och Tidningsins- accounts. In this procedure we also take auditing standards in Sweden will always amlingen AB for the year 2020. into account our knowledge otherwise detect a material misstatement when it In our opinion, the annual accounts have obtained in the audit and assess whether exists. Misstatements can arise from fraud been prepared in accordance with the An- the information otherwise appears to be or error and are considered material if, nual Accounts Act and present fairly, in all materially misstated. individually or in the aggregate, they could material respects, the financial position of If we, based on the work performed reasonably be expected to influence the the Svenska Förpacknings- och Tidning- concerning this information, conclude economic decisions of users taken on the sinsamlingen AB as of 31 December 2020 that there is a material misstatement of basis of these annual accounts. and its financial performance and cash this other information, we are required to As part of an audit in accordance with flow for the year then ended in accordance report that fact. We have nothing to report ISAs, we exercise professional judgment with the Annual Accounts Act. The statuto- in this regard. and maintain professional skepticism ry administration report is consistent with throughout the audit. We also: the other parts of the annual accounts. RESPONSIBILITIES OF THE Identify and assess the risks of materi- We therefore recommend that the gen- BOARD OF DIRECTORS AND al misstatement of the annual accounts , eral meeting of shareholders adopts the THE MANAGING DIRECTOR whether due to fraud or error, design and income statement and balance sheet. The Board of Directors and the Managing perform audit procedures responsive to Director are responsible for the prepara- those risks, and obtain audit evidence that BASIS FOR OPINIONS tion of the annual accounts and that they is sufficient and appropriate to provide a ba- We conducted our audit in accordance with give a fair presentation in accordance with sis for our opinions. The risk of not detect- International Standards on Auditing (ISA) the Annual Accounts Act. The Board of ing a material misstatement resulting from and generally accepted auditing standards Directors and the Managing Director are fraud is higher than for one resulting from in Sweden. Our responsibilities under also responsible for such internal control error, as fraud may involve collusion, forg- those standards are further described as they determine is necessary to enable ery, intentional omissions, misrepresenta- in the Auditor’s Responsibilities section. the preparation of annual accounts that are tions, or the override of internal control. We are independent of the Svenska För- free from material misstatement, whether Obtain an understanding of the compa- packnings- och Tidningsinsamlingen AB due to fraud or error. ny’s internal control relevant to our audit in accordance with professional ethics for In preparing the annual accounts, the in order to design audit procedures that accountants in Sweden and have otherwise Board of Directors and the Managing Di- are appropriate in the circumstances, but fulfilled our ethical responsibilities in ac- rector are responsible for the assessment not for the purpose of expressing an opin- cordance with these requirements. of the company’s ability to continue as a ion on the effectiveness of the company’s We believe that the audit evidence we going concern. They disclose, as applica- internal control. have obtained is sufficient and appropriate ble, matters related to going concern and Evaluate the appropriateness of ac- to provide a basis for our opinions. using the going concern basis of account- counting policies used and the reasonable- ing. The going concern basis of account- ness of accounting estimates and related OTHER INFORMATION THAN ing is however not applied if the Board disclosures made by the Board of Directors THE ANNUAL ACCOUNTS of Directors and the Managing Director and the Managing Director. This document also contains other in- intend to liquidate the company, to cease Conclude on the appropriateness of formation than the annual accounts and operations, or has no realistic alternative the Board of Directors’ and the Managing is found on pages [A-B]. The Board of but to do so. Director’s use of the going concern basis Directors and the Managing Director are of accounting in preparing the annual responsible for this other information. AUDITOR’S RESPONSIBILITY accounts. We also draw a conclusion, Our opinion on the annual accounts does Our objectives are to obtain reasonable based on the audit evidence obtained, as not cover this other information and we do assurance about whether the annual ac- to whether any material uncertainty exists

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 37 AUDITOR’S REPORT

related to events or conditions that may Our conclusions are based on the audit transactions and events in a manner that cast significant doubt on the company’s evidence obtained up to the date of our achieves fair presentation. ability to continue as a going concern. If auditor’s report. However, future events or We must inform the Board of Directors we conclude that a material uncertainty conditions may cause a company to cease of, among other matters, the planned exists, we are required to draw attention to continue as a going concern. scope and timing of the audit. We must in our auditor’s report to the related dis- Evaluate the overall presentation, struc- also inform of significant audit findings closures in the annual accounts or, if such ture and content of the annual accounts, during our audit, including any significant disclosures are inadequate, to modify including the disclosures, and whether the deficiencies in internal control that we our opinion about the annual accounts. annual accounts represent the underlying identified.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

OPINIONS on the size of the company’s equity, consol- Reasonable assurance is a high level of In addition to our audit of the annu- idation requirements, liquidity and position assurance, but is not a guarantee that an al accounts, we have also audited the in general. audit conducted in accordance with gener- administration of the Board of Directors The Board of Directors is responsible ally accepted auditing standards in Sweden and the Managing Director of Svenska För- for the company’s organization and the will always detect actions or omissions packnings- och Tidningsinsamlingen AB administration of the company’s affairs. that can give rise to liability to the com- for the year 2020 and the proposed appro- This includes among other things continu- pany, or that the proposed appropriations priations of the company’s profit or loss. ous assessment of the company’s financial of the company’s profit or loss are not in We recommend to the general meeting situation and ensuring that the compa- accordance with the Companies Act. of shareholders that the profit be appropri- ny’s organization is designed so that the As part of an audit in accordance with ated in accordance with the proposal in the accounting, management of assets and generally accepted auditing standards in statutory administration report and that the company’s financial affairs otherwise Sweden, we exercise professional judg- the members of the Board of Directors and are controlled in a reassuring manner. The ment and maintain professional skepticism the Managing Director be discharged from Managing Director shall manage the ongo- throughout the audit. The examination liability for the financial year. ing administration according to the Board of the administration and the proposed of Directors’ guidelines and instructions appropriations of the company’s profit BASIS FOR OPINIONS and among other matters take measures or loss is based primarily on the audit of We conducted the audit in accordance with that are necessary to fulfill the company’s the accounts. Additional audit procedures generally accepted auditing standards in accounting in accordance with law and performed are based on our professional Sweden. Our responsibilities under those handle the management of assets in a re- judgment with starting point in risk and standards are further described in the assuring manner. materiality. This means that we focus the Auditor’s Responsibilities section. We are examination on such actions, areas and independent of the Svenska Förpacknings- AUDITOR’S RESPONSIBILITY relationships that are material for the och Tidningsinsamlingen AB in accordance Our objective concerning the audit of the operations and where deviations and vio- with professional ethics for accountants in administration, and thereby our opinion lations would have particular importance Sweden and have otherwise fulfilled our about discharge from liability, is to obtain for the company’s situation. We examine ethical responsibilities in accordance with audit evidence to assess with a reasonable and test decisions undertaken, support these requirements. degree of assurance whether any member for decisions, actions taken and other We believe that the audit evidence we of the Board of Directors or the Managing circumstances that are relevant to our have obtained is sufficient and appropriate Director in any material respect: opinion concerning discharge from liability. to provide a basis for our opinions. has undertaken any action or been guilty As a basis for our opinion on the Board of any omission which can give rise to lia- of Directors’ proposed appropriations of RESPONSIBILITIES OF THE bility to the company, or the company’s profit or loss we examined BOARD OF DIRECTORS AND in any other way has acted in contra- whether the proposal is in accordance with THE MANAGING DIRECTOR vention of the Companies Act, the Annual the Companies Act. The Board of Directors is responsible for Accounts Act or the Articles of Association. the proposal for appropriations of the Our objective concerning the audit of the Stockholm May 27 2021 company’s profit or loss. At the proposal of proposed appropriations of the compa- a dividend, this includes an assessment of ny’s profit or loss, and thereby our opinion Ernst & Young AB whether the dividend is justifiable consid- about this, is to assess with reasonable ering the requirements which the compa- degree of assurance whether the proposal Andreas Nyberg ny’s type of operations, size and risks place is in accordance with the Companies Act. Authorized Public Accountant

38 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 FTI has been assigned to collect newspapers and packaging for recycling on behalf of the business sector. Sustainability and circularity are fundamentals of our operations. In 2018, we laid the foundation for working in a structured manner with sustainability. These efforts were formalized under 2019 and this year’s report SUS is therefore FTI’s second formal Sustainability Report.

THE CONTENTS OF FTI’S Sustainability Report are based on the materiality assessment conducted in 2018 which, in turn, is based on a structured dialog with our key stakeholders. Seven material topics were identified and categorized into four main areas – circularity and TAIN recyclability, business ethics and environmental compliance, occupational health and safety, and greenhouse gases. Through these four areas, FTI is contributing to the achievement of several Sustainable Development Goals. The connection with the goals is shown in the table on the next page. This year’s report covers the 2020 operational year, unless otherwise stated. The report has been prepared in accordance with the Core option of the ABI GRI Standards issued by the Global Reporting Initiative, and FTI’s CEO is ultimately responsible for FTI’s sustainability efforts. FTI intends to gradually set and report more measur- able sustainability targets for the company’s material topics. The recycling targets for packaging were raised from 2020 and onwards, and the method for calculating recycling rates has changed. The new measurement points will improve opportunities moving forward for cal- LITY culating the actual environmental and climate benefits of recycling. In 2020, a project aimed at enabling this measurement commenced. The project is expected to conclude in 2021.

FTI’S VALUE CHAIN is defined by producer responsibility obligations, for which the Swedish government adopted two new ordinances in 2018 that will be implemented in REP stages from 2020 onwards. In September 2020, the government decided to delay some parts of the new Ordi- nance on Producer Responsibility for Packaging. This means that transitional arrangements will apply until December 31, 2022, and that the existing collection scheme will continue to operate during that period, with 5,000 recycling stations and curbside collection services for 2 million households. In December 2020, the govern- ORT ment decided that waste paper would be exempt from producer responsibility obligations and that the responsibility for collecting newspapers would be transferred to municipalities on January 1, 2022. Some of the government decisions in recent years could have a major impact on FTI’s operations and also, therefore, serve as guidance for sustainability efforts moving forward.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 39 01 FTI SUSTAINABILITY REPORT

❚ ENVIRONMENTAL COMPLIANCE Very important Very ❚ CIRCULARITY ❚ ANTI-CORRUPTION ❚ RECYCLABILITY ❚ CARTELIZATION ❚ OCCUPATIONAL HEALTH ❚ DIVERSITY AND GENDER EQUALITY AND SAFETY ❚ SUPPLIERS – ENVIRONMENT ❚ GREENHOUSE GASES

❚ SUPPLIERS – SOCIAL Relevance for stakeholders for Relevance ❚ ENERGY EFFICIENCY MATERIALITY ❚ CONTINUOUS DEVELOPMENT ❚ JOB CREATION ❚ DIVERSITY AND GENDER ASSESSMENT EQUALITY Based on structured stakeholder dialog, a materiality assessment was conducted in 2018 that resulted in seven material topics

which were categorized into four Important main areas. Important Relevance for FTI Very important

SUSTAINABLE DEVELOPMENT GOALS – FTI’S CONTRIBUTION AND IMPACT FTI’s sustainability efforts are based on the 2030 Agenda for Sustainable Development. The SDGs that FTI is best able to contribute to, based on the material topics identified, are Goals 8, 12, 13 and 16.

FTI’S MATERIAL TOPICS

CIRCULARITY AND BUSINESS ETHICS AND ENVI- OCCUPATIONAL GREENHOUSE RECYCLABILITY RONMENTAL COMPLIANCE HEALTH AND SAFETY GASES + + + + Our nationwide collection FTI expects its suppliers to We impose requirements on We continued our efforts to cal- scheme makes it possible for maintain high standards in decent working conditions in our culate our total GHG emissions all Swedish residents to recycle terms of human rights and own operations, as well as those in order to set targets for how their packaging so it is included corruption. We engage in close of our partners and suppliers, we can reduce FTI’s direct and in the process of each materials dialogue with the EPA, Swedish through our Code of Conduct, for indirect emissions. company. municipalities, trade organiza- example. tions and the business sector. - - - The coming changes to producer Risk that collection volumes, - Major changes in external responsibility in the new ordi- material quality and recyclability As laws change and new situa- factors are placing new and nances will make it more diffi- are not high enough to increase tions arise, the knowledge of what tougher demands on FTI as an cult to forecast and set targets circularity. constitutes corruption needs to be organization, and on our em- for FTI’s emissions. raised within the organization. ployees and partners.

40 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 FTI SUSTAINABILITY REPORT 02

CIRCULARITY AND RECYCLABILITY

Circularity and recyclability are obvious and prioritized issues for us, and are the mainstay of our value chain via our nationwide collection scheme for newspapers and packaging.

More ambitious recycling targets Circularity and recyclability are the cornerstones of our operations. Our mission is to make newspapers and packaging easier to collect and recycle.

FTI’S ASSIGNMENTis to provide a nationwide sustainable consumers are requesting packaging that is easy to recycle. collection scheme for newspapers and packaging, so that In addition to our manuals, producers can request advice these materials can be part of a closed loop and used to and support from FTI throughout the entire design process. make new products. Circularity and recyclability are the We hold seminars and training together with the materials cornerstones of our operations. Concerns about climate companies, the EPA and other stakeholders. We apply a fee change and the environment have grown sharply in recent structure where the fee for packaging that is easy to recycle years, among the general public as well as the business is lower than the fee for more complex packaging. sector. And in line with these growing concerns, the demands and expectations on our operations have also in- FTI WORKS CONTINUOUSLY to make waste separation and creased. We now offer collection via 5,000 recycling stations recycling easier for households. Our consumer survey, the and curbside services for two million households. Recycling Barometer, has been part of this process for over 2020 was a record year for collection volumes. Changed ten years. In 2020, we ran a number of consumer awareness behaviors in the wake of the pandemic probably contributed campaigns, such as an upgrade of ‘The Material World’ pre- to the dramatic increase. In total, we collected more than school teaching kit, continuous updates of our sorting guide 660,000 metric tons of newspapers and packaging, corre- and a continuation of our ‘Everyone wins when you recycle’ sponding to 64 kg per person. Paper packaging accounted campaign. for the greatest increase (16 percent), followed closely by The aim is to recycle the highest proportion of packag- plastic and metal packaging (both 11 percent). Glass packing placed on the Swedish market as possible. The Swedish aging increased marginally, while newspapers continue to government’s recycling targets were raised significantly for fall due to changed media consumption habits. 2020 and onwards, while the EU has introduced new report- While a high proportion of collected packaging is fun- ing requirements that will bring changes to how recycling damental to circularity, much more is needed to meet the rates are calculated. Only the amount of material that is ambitious recycling targets. Some of the challenges we face actually recycled is reported – the proportion that becomes are sorting quality, the amount of material in the recycling new material and is used to replace virgin raw material. FTI bins that is not packaging, and that some materials are not welcomes this new method for measuring the recycling rate, environmentally efficient to sort into recycling streams. since this has always been the starting point for our training courses for producers via the recycling manuals, for exam- DESIGN AND CHOICE OF PACKAGING MATERIALS are ple. The new measurement points will also make it easier as key factors for recyclability. That is why we have recycling we move forward to calculate the actual environmental and manuals for each of the four materials: plastic, paper, climate benefits of recycling. In 2020, the total recycling rate metal and glass. The manuals have been produced on be- was 77 percent for paper packaging, 28 percent for plastic half of each materials company, our owners, and guide and packaging, 87 percent for metal packaging made from steel, inform our affiliated producers about the materials they and 56 percent for metal packaging made from aluminum. should choose, and the designs that make sorting and re- The recycling rate, which is the EU’s new definition, mea- cycling easier. For many producers, the choice of recycla- sures the proportion of packaging placed on the market that ble packaging material is an integral part of their product has been collected and converted into recycled raw material development process, especially when more and more and is used to replace virgin raw material.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 41 03 FTI SUSTAINABILITY REPORT

BUSINESS ETHICS AND ENVIRONMENTAL COMPLIANCE

Sound business ethics and environmental compliance are fundamental to FTI. Our operations are based on producer responsibility for newspapers and packaging. Our success as an organization is largely determined by whether we are perceived as accountable, credible and professional.

requirements of the ordinance. The EPA, The core of FTI’s which incidentally did not approve any of the applications, also announced that the provisions of the actual ordinance needed operations to be revised. The EPA submitted its views to the government in a letter dated June Environmental compliance is crucial for 15, 2020, and requested that the Ordinance on Producer Responsibility for Packaging FTI, as is being perceived as credible be revised in those sections pertaining to the collection scheme. On September 24, and accountable by both our customers 2020, the government stipulated that the and the community at large. implementation of the provisions pertaining to a licensed collection scheme be delayed until January 1, 2023. In February 2021, the Swedish Ministry of the Environ- FTI’S OPERATIONS ARE BASED ON pro- ment announced that it would be conduct- ducer responsibility obligations for news- ing an internal inquiry to review producer papers and packaging. It is paramount that In 2020, FTI was responsibility for packaging. The inquiry not subject to any we are environmentally compliant, that our will propose new provisions for packaging significant penalties, business ethics are sound and that we are injunctions or fines collection and recycling. The proposal will perceived as credible and accountable by for breaching be circulated for review in autumn 2021. both our customers and the community at environmental In 2020, FTI was not subject to any sig- large. FTI’s CEO is ultimately responsible regulations. nificant penalties, injunctions or fines for for our efforts to maintain sound business breaching environmental regulations. ethics and environmental compliance. Our operations are funded by packaging fees, BUSINESS ETHICS, CORRUPTION which should be completely material-inde- CODE OF AND COMPETITION pendent and based on the costs incurred CONDUCT FTI PROMOTES COMPETITION, is a by the scheme. FTI’s Code of Conduct non-profit organization, and no dividends for suppliers is based are paid to our owners. The costs of collec- on the Universal ENVIRONMENTAL COMPLIANCE Declaration of Human tion and recycling should affect the price of WHEN IT COMES to environmental com- Rights and is an the packaged goods as little as possible. pliance, we engage in close dialog and col- important governing Through our ownership structure, in laboration with the Swedish Environmental document that sets which several of our owners and their re- Protection Agency (EPA), municipalities, out the guidelines spective owners are competitors in some trade organizations and the business sec- for business ethics, instances, we are committed to working as including anti-corrup- tor. That applies to collection and recycling, transparently and objectively as possi- tion, health and safety as well as production and development. and the environment. ble. We have competition law guidelines By doing so, we can stay up to date and The Code of Conduct for the Board, describing how the Board involved, and help to shape future trends. sets a minimum level and its members should act to ensure Our operations are governed by Chapter for the sustainabil- compliance with competition law. Pricing, 15 of the Swedish Environmental Code, the ity performance of market share, strategies, profit margins Ordinance on Producer Responsibility for suppliers, but also and commercial terms for companies allows cooperation Packaging, the Waste Management Ordi- associated with our Board are some of the and dialog to achieve nance and the regulations issued by the improvements. FTI’s issues that must not be discussed. Any EPA. On March 31, 2020, we submitted an values apply to all discussions or exchanges of information application to conduct a licensed collection employees, and between members of the Board shall only scheme (LCS) pursuant to the Ordinance are based on facts, concern matters that are necessary for the on Producer Responsibility for Packaging simplicity, efficiency, operation and management of FTI. FTI’s responsiveness and to the EPA. The EPA rejected our appli- Code of Conduct for suppliers states clear- collegiality. cation on May 20, 2020, on the grounds ly that no form of corruption, including that the application did not meet the blackmail and bribery, will be tolerated. We

42 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 FTI SUSTAINABILITY REPORT 04

In 2020, no known cases of corruption linked to FTI or its immediate employees were reported or detected.

have previously identified that awareness of what may constitute corruption needs to be raised within the organization. We will therefore continue to arrange internal training for those employees who are considered most exposed to various types of corruption risk due to the nature their work. We updated our anti-corruption policy in 2021, and intend to arrange training for all employees in this area. In 2020, no known cases of corruption linked to FTI or its employees were reported or detected.

BUSINESS ETHICS AND HUMAN RIGHTS IN THE SUPPLY CHAIN FTI HAD THE RIGHT TO TERMINATE A MAJOR SHARE OFour activities are carried out by partners, contractors and THE AGREEMENT WITH TMR REGARDING suppliers and we expect these operators ACCESS TO FTI’S COLLECTION SCHEME to act fairly and in an ethical manner. FTI On February 28, 2020, the Swedish Patent and has a responsibility to the people who Market Court of Appeal handed down its decision in favor of FTI in perform services or produce products the case against the Swedish Competition Authority. The Court ruled that FTI had not breached the Competition Act. The Court’s decision, on our behalf. We must ensure that the which cannot be appealed, means that FTI was entitled to terminate people whose efforts contribute to our the agreement with TMResponsibility (TMR) regarding access to success are not deprived of their human FTI’s collection scheme. From February 28, 2020, TMR has not there- rights, or suffer physical or mental harm. fore been authorized to offer FTI’s recycling stations to its custom- That is why our Code of Conduct includes ers, and only FTI-affiliated producers are entitled to capacity at FTI’s a requirement that our suppliers and recycling stations. their subcontractors support and respect The background to the above is that in 2012, following pressure from the Swedish Competition Authority, FTI entered into an agree- international human rights, including safe ment with TMR whereby TMR gained access to FTI’s recycling sta- and healthy working conditions, and that tions. FTI terminated the agreement in 2016 for business reasons. they do not participate in human rights Following a complaint from TMR, the Swedish Competition Authority violations. We aim to perform follow-ups of decided to order FTI, under penalty of fine, to revoke the termination our contracting parties at least every third of the agreement. FTI appealed the Competition Authority’s deci- year. This was not possible in 2020 due to sion. On February 28, 2020, the Patent and Market Court of Appeal overturned the Competition Authority’s decision on the grounds that the COVID-19 pandemic, but we are hoping there was no lawful basis for the Competition Authority’s order. to work more actively to ensure compliance with our Code of Conduct in 2021.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 43 05 FTI SUSTAINABILITY REPORT

OCCUPATIONAL HEALTH AND SAFETY

We want to offer a company culture where all employees are able to grow and develop. Therefore, in 2020, we laid the foundation for working actively to create the clear leadership and employeeship that is required to build a company culture that is sustainable over the long term.

A sustainable work/life balance Here at FTI, employees are our most valuable asset. In order to meet our goals and expectations, as well as those of our owners, customers and society at large, we need to create the conditions for staying motivated and engaged, for job satisfaction and the ability to use and develop our expertise, while also helping to make a difference.

IN 2020, the COVID-19 pandemic had a each other at the office with the high de- major impact on our working lives. Most gree of flexibility enabled by working from of us worked mainly from home through- In 2020, sick leave home via digital technology. out most of the year, in accordance with fell from 4.15 percent We offer a fitness subsidy to facilitate the guidance issued by the Public Health to 1.85 percent and and promote good health, and arranged Agency of Sweden. We set up a Coronavi- short-term sick-leave virtual meetings with a focus on physical was as low as rus Crisis Team as early as March 2020, activity, but also to spread knowledge, 0.9 percent. which held weekly meetings and followed inspiration and energy via various focus the situation carefully so that we could areas. For some time, we have been set- respond quickly and immediately reach out ting aside time for wellness walks during with information should conditions change. “Most of working hours and will now continue to We focused on ensuring the best physical promote walking meetings to ensure and psychosocial conditions for remote us worked outdoor physical activity during the day work as possible, and tried to find the most mainly and, especially during the winter months, flexible working arrangements possible to get some fresh air and daylight. All for those employees who needed to work from home employees are covered by collective bar- from the office. In addition to close contact throughout gaining agreements and represented on between managers and employees, we the Board. also conducted a number of follow-up most of the surveys. The pandemic has sped up the year.” IN 2020, FTI’s figures for both sick leave digital transformation and we have now and employee turnover declined. In 2020, learnt that a digital workplace can be more total staff turnover rate was 12 percent, productive than we realized. This new way which is a relatively sharp decline year- of working has also been positive in terms on-year, while sick leave fell 4.15 percent of greater flexibility, eliminating commuter to 1.85 percent. Short-term sick leave was travel and so forth, which has also helped as low as 0.9 percent. Like many other to create a better work/life balance. We companies, we believe that this low figure have commenced a dialog on post-pan- is somewhat related to the coronavirus demic ways of working, where we want to pandemic and that most of us worked from combine the positive aspects of meeting home throughout most of 2020.

44 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 FTI SUSTAINABILITY REPORT 06

GREENHOUSE GASES

A key step in FTI’s sustainability activities is to measure our GHG emissions. In 2018, this process commenced by calculating our Scope 1 and Scope 2 emissions. Some Scope 3 categories and emission factors were included for 2019. We have included more Scope 3 categories for 2020.

A climate focus One of the biggest challenges of our time is GHG emissions. As a company in the recycling industry, this is a high priority issue that we are working actively to address.

FTI’S EFFORTSin this area are strengthening legitimacy in mestic transport by 2025. our relationships with stakeholders – from FTI’s employees In 2020, a project commenced with the aim of measuring to customers, authorities, contractors and suppliers. 2018 the environmental and climate benefits of recycling, which is was the first year we reported our GHG emissions (Scope 1 expected to conclude in 2021. In FTI’s Sustainability Report and Scope 2). We reported some Scope 3 emissions in 2019, for 2019, our intention was to review how the collection and and more Scope 3 emissions were included in our calcu- recycling of newspapers and packaging compared with aims lations for 2020. This affected our total emissions, which of the Intergovernmental Science-Policy Platform on Biodi- amounted to 60,500 metric tons of CO2e (10,447) in 2020 – versity and Ecosystem Services (IPBES, 2019). This process using the market-based method, which includes biogenic has commenced and will continue for 2021 but with a focus emissions. The absolute highest share of FTI’s CO2 emis- on the indirect effects, since FTI is not a producer. sions are Scope 3 emissions, which include indirect emissions from the collection of paper, plastic and metal packag- ACCOUNTING AND REPORTING STANDARDS ing at FTI’s recycling stations, and from curbside collection FTI CALCULATES and reports its GHG emissions in accor- services. These also include emissions from the cleaning of dance with the GHG Protocol Corporate Accounting and stations, purchasing and replacing bins, non-collection-re- Reporting Standard. Scope 2 emissions are calculated using lated transportation of materials, handling the materials at the GHG Protocol Scope 2 Guidance for market and loca- facilities, business travel (including hotel accommodation), tion-based methods. Scope 3 emissions are calculated using commuting, the extra energy consumed by employees the GHG Protocol Guidance for Calculating Scope 3 Emis- working from home and IT product purchasing, as well as sions. Activity data is obtained from utility bills, and informa- indirect Scope 1 and Scope 2 emissions. tion reported by landlords and suppliers. Energy conversion Scope 2 emissions are derived from the energy con- is based on publicly available conversion factors, and emis- sumed by FTI’s head office. The low emissions using the sion factors are obtained from open databases, such as the market-based method compared with the location-based International Energy Agency (2018), DEFRA (2020), the EPA’s method are attributable to green electricity, district heating calculation tool in collaboration with IVL (2018), certified and district cooling. Due to the increase in remote working environmental declarations as well as purchased databases during the pandemic combined with some improvements by such as EcoInvent V3.6 and GaBi TS professional. The green- suppliers, Scope 2 emissions decreased to 50 kg CO2e (107) house gases reported are carbon dioxide (CO2), methane in 2020, and the energy used by employees is included in the (CH4) and nitrous oxide (N2O). Biogenic emissions of CO2 calculations for Scope 3. from burning biofuel and biomass are reported separately FTI is aware that Scope 3 emissions, meaning indirect from other GHG emissions as Outside Scope. The glob- emissions in our supply chain, represent the absolute al warming potentials (GWPs) used to calculate CO2e are largest source of our emissions. We included a significant based on the Fifth Assessment Report (AR5) of the Intergov- proportion of these emissions in 2020, and will report even ernmental Panel on Climate Change (IPCC) over a 100-year more emission sources and improve the quality of our data period. FTI applies the operational control approach for in 2021. Alongside of mapping our total emissions, we are consolidating its GHG emissions. Emissions data has some also creating an action plan. We joined Fossil Free Sweden inherent uncertainty due to both scientific and estimation in 2019 and committed to their transport challenge with uncertainty, with subsequent effects on measurements and the target of only purchasing and providing fossil-free do- estimates.

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 45 07 FTI SUSTAINABILITY REPORT

SOCIAL DATA NO. OF EMPLOYEES NEW EMPLOYMENTS NEW EMPLOYMENTS PER GENDER AND AGE 2018 2018 MEN 31 WOMEN 29 60 <30 YEARS 30-50 YEARS > 50 YEARS TOTAL 2019 MEN 34 WOMEN 30 64 WOMEN 2 4 2 8 MEN 1 3 4 8 MEN 31 WOMEN 27 2020 58 TOTAL: 3 7 6 16

TOTAL EMPLOYEE TURNOVER NEW EMPLOYMENTS PER GENDER AND AGE 2019

2020 2019 2018* <30 YEARS 30-50 YEARS > 50 YEARS TOTAL 12% 14.3% 22.8% WOMEN 0 4 0 4 *The figure includes retirements and fixed-term contracts of less than six months. MEN 6 3 3 12

TOTAL: 6 7 3 16 AGE DISTRIBUTION  21-30 years  31-40 years  41-50 years  51-60 years  60+ years NEW EMPLOYMENTS PER GENDER AND AGE 2020 5% 9% 13% 12% 8% 18% <30 YEARS 30-50 YEARS > 50 YEARS TOTAL 18% 24% 18% 33% WOMEN 0 5 1 6 2020 27% 2019 2018 MEN 1 2 2 5 33% 22% 29% 30% TOTAL: 1 7 3 11

GENDER EQUALITY SICK LEAVE 2020 2019 2018 2020 2019 2018

Women on the Board 17% 17% 12% LONG-TERM 0.95% 2.59% 0.33%

Women in the MT 38% 50% 46% SHORT-TERM 0.90% 1.56% 2.58%

Share of women of total employees 49% 47% 48% TOTAL: 1.85% 4.15% 2.91%

GREENHOUSE GASES GHG EMISSIONS 2020 2019 2018

SCOPE 1 20,644 KG CO2E 30,300 KG CO2E 82,523 KG CO2E

SCOPE 2 (MARKET-BASED) 50 KG CO2E 107 KG CO2E 292 KG CO2E

SCOPE 2 (LOCATION-BASED) 3,155 KG CO2E 4,589 KG CO2E 4,877 KG CO2E

SCOPE 3 53,592,342 KG CO2E 6,360,863 KG CO2E -

BIOGENIC EMISSIONS 6,941,507 KG CO2E 4,056,292 KG CO2E 1,834 KG CO2E

TOTAL (MARKET-BASED) 60,557,718 KG CO2E 10,447,572 KG CO2E 84,650 KG CO2E

RECYCLING RATES 2020 MATERIAL RECYCLING RATE RECYCLING RATE RECYCLING RATE GOVERNMENT’S TARGET HOUSEHOLDS COMPANIES* TOTAL FROM 2020 ONWARDS

PAPER 66% 84% 77% 85%

PLASTIC 15% 46% 28% 50%

METAL (STEEL) 93% 81% 87% 70%

METAL (ALUMINUM) 53% 84% 56% 50%

*The materials companies only handle packaging from Swedish households. The packaging consumed by companies is handled by commercial recycling operators. However, FTI and the materials companies have undertaken to gather statistics and report collection and recycling rates to the EPA for this packaging as well.

46 FTI ANNUAL AND SUSTAINABILITY REPORT 2020 GRI CONTENT INDEX

NEW EMPLOYMENTS PER GENDER AND AGE 2018

<30 YEARS 30-50 YEARS > 50 YEARS TOTAL

WOMEN 2 4 2 8 GRI CONTENT INDEX 2020 THIS IS THE SUSTAINABILITY REPORT for the limited liability company Förpacknings- och Tidnings- MEN 1 3 4 8 insamlingen (FTI) and its operations for the period of January 1-December 31, 2020. All information TOTAL: 3 7 6 16 and performance measures reported refer to the fiscal year of 2020, unless otherwise stated. The GRI content index below shows where the various disclosures can be found. For questions about FTI’s Sustainability Report, please contact the Director of Communications Veronica Foberg Gustafsson. NEW EMPLOYMENTS PER GENDER AND AGE 2019 Phone: +46 (0)70-212 16 44, e-mail: [email protected] <30 YEARS 30-50 YEARS > 50 YEARS TOTAL

WOMEN 0 4 0 4

MEN 6 3 3 12 GRI GENERAL DISCLOSURES PAGE MATERIAL TOPICS 102-1 Name of the organization 2, 30, 31 BUSINESS ETHICS & ENVIRONMENTAL COMPLIANCE TOTAL: 6 7 3 16 102-2 Activities, brands, products, and services 2, 8-9 205: Anti-corrupton

102-3 Location of headquarters 31, 48 GRI 103: 103-1 Explanation of the material topic and its Boundaries 42-43 MANAGEMENT NEW EMPLOYMENTS PER GENDER AND AGE 2020 102-4 Location of operations 2 APPROACH 2016 103-2 The management approach and its components 42 102-5 Ownership and legal form 2, 29, 31 103-3 Evaluation of the management approach 42-43 <30 YEARS 30-50 YEARS > 50 YEARS TOTAL 102-6 Markets served 2 GRI 205: 205-3 Confirmed incidents of corruption and actions taken 43 102-7 Scale of the organization 3, 34,46 ANTI-CORRUPTION WOMEN 0 5 1 6 2016 102-8 Information on employees and other workers 34, 46 206: Anti-competitive behavior

MEN 1 2 2 5 102-9 Supply chain 8-9 GRI 103: 103-1 Explanation of the material topic and its Boundaries 42-43 MANAGEMENT 102-10 Significant changes to the organization and its supply chain 32-35 APPROACH 103-2 The management approach and its components 42 TOTAL: 1 7 3 11 2016 102-11 Precautionary Principle or approach 47 103-3 Evaluation of the management approach 42-43 102-12 External initiatives 6-7, 10-27 GRI 206: 206-1 Legal actions for anti-competitive ANTI-COMPETITIVE behavior, anti-trust and monopoly practices 43 102-13 Membership of associations 45 BEHAVIOR 2016 307: Environmental compliance 2020 2019 2018 102-14 Statement from senior decision-maker 3 102-16 Values, principles, standards, and norms of behavior 40, 47 GRI 103: 103-1 Explanation of the material topic and its Boundaries 42 MANAGEMENT LONG-TERM 0.95% 2.59% 0.33% 102-18 Governance structure 29 APPROACH 103-2 The management approach and its components 42 2016 102-40 List of stakeholder groups 8-9, 40 103-3 Evaluation of the management approach 42 SHORT-TERM 0.90% 1.56% 2.58% 102-41 Collective bargaining agreements 44 GRI 307: 307-1 Non-compliance with ENVIRONMENTAL environmental laws and regulations 42 TOTAL: 1.85% 4.15% 2.91% 102-42 Identifying and selecting stakeholders 40 COMPLIANCE 102-43 Approach to stakeholder engagement 40 CIRCULARITY & RECYCLABILITY 102-44 Key topics and concerns raised 30, 40 Circularity & Recyclability 102-45 Entities included in the consolidated financial statements 30, 40 GRI 103: 103-1 Explanation of the material topic and its Boundaries 41 MANAGEMENT 102-46 Defining report content and topic Boundaries 40 APPROACH 103-2 The management approach and its components 41 2016 102-47 List of material topics 40 103-3 Evaluation of the management approach 41 102-48 Restatements of information * CIRCULARITY & EI-1 Recycling rates RECYCLABILITY & Material recovery 46 102-49 Changes in reporting 30 102-50 Reporting period 30 GREENHOUSE GASES 102-51 Date of most recent report 30 305: Emissions GRI 103: 103-1 Explanation of the material topic and its Boundaries 45 102-52 Reporting cycle 30 MANAGEMENT 102-53 Contact point for questions regarding the report 47 APPROACH 103-2 The management approach and its components 45 2016 102-54 Claims of reporting in accordance with the GRI Standards 47 103-3 Evaluation of the management approach 45 102-55 GRI content index 47 305-1 Direct (Scope 1) GHG emissions 46 GRI 305: 305-2 Indirect (Scope 2) GHG emissions 46 102-56 External assurance * EMISSIONS 2016 305-3 Indirect (Scope 3) GHG emissions 46 OCCUPATIONAL HEALTH AND SAFETY 401: Employment

GRI 103: 103-1 Explanation of the material topic and its Boundaries 44 MANAGEMENT APPROACH 103-2 The management approach and its components 44 2016 103-3 Evaluation of the management approach 44

GRI 401: 401-1 New employee hires EMPLOYMENT 2016 and employee turnover 46 Sick leave GRI 103: 103-1 Explanation of the material topic and its Boundaries 44 MANAGEMENT APPROACH 103-2 The management approach and its components 44 2016 103-3 Evaluation of the management approach 44 SICK LEAVE El-2 Sick leave 46

2020 FTI ANNUAL AND SUSTAINABILITY REPORT 47 BOX 1176, SE-171 23 SOLNA, SWEDEN | STREET ADDRESS: SVETSARVÄGEN 10, 3RD FLOOR +46 (0)8 566 144 00 | [email protected] | FTIAB.SE FOLLOW US ON FACEBOOK: @FTIAB

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