Working Together Sustainably

WORKING TOGETHER SUSTAINABLY

Disclaimer Environmental This report has been compiled Sustainability Report by Carter Holt Harvey Pulp & Paper Limited (‘CHH PP’) from for the 2014 calendar year › make no representation or internal records and publicly warranty, nor provide any available information for general undertaking, expressed or information purposes and not as implied, as to the timeliness, specifi c advice to any particular accuracy, adequacy, › are under no duty of recipient or person. reliability, reasonableness disclosure or fi duciary Contact Due care has been exercised in or completeness of the duty or any obligation to compiling the report and CHH information or any opinion update any information For more information PP believes the information or statement contained in contained in this report or or feedback: contained herein to be correct this report any other written or oral but has not subjected it to [email protected] › shall have no liability communication transmitted independent review or audit. (including for negligence) for or made available to a Carter Holt Harvey To the maximum extent any statements, opinions, recipient, or to notify any Pulp & Paper Limited permitted by law, CHH PP, information or matters person should any such Private Bag 92004 its related companies and (express or implied) arising information cease to be Victoria Street West affi liates and/or any of their out of, contained in or derived correct after it is provided Placeholder, not for Printing Logo use must be Auckland 1142 respective directors, offi cers, from (directly or indirectly), and each recipient, by approved by Blue Star Group NZ Ltd New Zealand employees, agents, offi cials, nor for any errors or omissions accepting delivery of this Min Size 17mm Height www.chhpulpandpaper.com advisors or representatives, as from, or failure to correct, any report, waives all rights in Cxxxxxx www.chhpackaging.com the case may be: information in this report such regard. 8 | PERFORMANCE Contents Data & trends from 2014 | Packaging manufacturing operations 37

Selected key indicators (indexed to output) for 2014 relative to 2007 (base year).

Packaging Australia

40 Total energy consumption

30 1 2 3 Scope 1 and 2 emissions (CO2-e) CHIEF EXECUTIVE’S 2014 PURPOSE 20 Water take

MESSAGE HIGHLIGHTS OUR BUSINESS & APPROACH 10 Waste to landfill (estimated) P1 P2 P3 2007 BASE 0 Recovered fibre in feedstock

–10

–20 % Change

–30 2008 2009 2010 2011 2012 2013 2014 4 5 6 Packaging New Zealand

PRODUCTS PLANET PROCESS 30 Total energy consumption UNLOCKING THE VALUE RESPONSIBLE SOURCING STRIVING FOR OPERATIONAL 20 OF FIBRE OF FIBRE EXCELLENCE 10 Scope 1 and 2 emissions (CO2-e) P8 P13 P19 2007 BASE 0 Water take –10 –20 Waste to landfill (estimated) –30 Recovered fibre in feedstock –40

% Change –50 –60

–70 –80 7 8 2008 2009 2010 2011 2012 2013 2014 PARTNERSHIP PERFORMANCE COLLABORATION WITH DATA & TRENDS OUR STAKEHOLDERS FROM 2014 P26 P33

About this Report Scope Reporting Standards

This Environmental This report covers the calendar year 2014 and includes The contents of this report have been prepared with due Sustainability Report is the environmental performance data for the manufacturing reference to international reporting standards, including latest in a series of documents operations of Carter Holt Harvey Pulp & Paper Group. the Global Reporting Initiative Sustainability Reporting presenting Carter Holt Manufacturing operations are defi ned as Kinleith Mill, Guidelines Version 3.1 (G3.1) (‘the GRI’) and the Greenhouse Harvey Pulp & Paper Group’s Tasman Mill, Penrose Mill, Packaging Australia and Packaging Gas Protocol Corporate Reporting Standard (‘the GHG New Zealand. Environmental performance data are not Protocol’), for guidance. environmental performance presented for the service-focused sectors, i.e. Corporate Data are collected and presented in accordance with the since 2007. Offi ces, Fullcircle Recycling and Lodestar. following GRI Core Environmental Performance Indicators: Due to shared wastewater treatment infrastructure, certain EN1 Materials used by weight or volume effl uent data presented for the Tasman Mill include those EN3 Direct energy consumption by primary energy source from the neighbouring newsprint operation owned and EN4 Indirect energy consumption by primary source operated by Norske Skog Tasman. These are identifi ed in the notes to the data tables. EN8 Total water withdrawal by source EN16 Total direct and indirect greenhouse gas emissions by weight (Scope 1 and Scope 2) Data Trends EN21 Total water discharge by quality and destination No adjustments to the bases were required in 2014. EN22 Total weight of waste by type and disposal method 1 | CHIEF EXECUTIVE’S MESSAGE 1

Welcome to Carter Holt Harvey Pulp The 2014 purchase of Carter Holt Harvey Pulp & Paper Group by joint venture partners & Paper Group’s Environmental Oji Holdings Corporation (Oji) and Innovation Network Corporation of Japan (INCJ) Sustainability Report for the is a milestone for our business. The new owners are long-term investors with proud histories. Oji is a large and respected company with extensive experience in pulp, 2014 calendar year. paper and packaging, including with existing New Zealand assets. INCJ is a corporation sponsored by the Japanese government and Japanese private enterprise, aimed at promoting innovation and enhancing Japanese businesses. Both owners bring expanded horizons to our business. Oji, in particular, will bring considerable expertise to boost our ability to develop even better products and services for our customers. Oji and INCJ both hold innovation as a core value. We look forward to ‘growing together’ on new and improved ways of doing business. Oji and INCJ also bring a strong commitment to sustainability. We are proud to be part of a group aspiring to ‘zero environmental burden’. We also continue to take seriously our responsibility to maintain and build relationships with our local communities, reflecting Carter Holt Harvey Pulp & Paper Group’s strong presence within regional New Zealand. So, welcome to Carter Holt Harvey Pulp & Paper Group’s 2014 environmental sustainability report. This is a demonstration of our ongoing commitment to being a responsible business and the importance of sharing information with all our stakeholders.

Dr Jon Ryder chief executive carter holt harvey pulp & paper limited 2 | HIGHLIGHTS 2014 Highlights 2

Manufacturing Operations: Energy Sources, 2014

73.8% ENERGY FROM BIOMASS 80.2% RENEWABLE ENERGY (BIOMASS, GEOTHERMAL STEAM) Contribution from purchased electricity is not included.

6.4% ENERGY FROM GEOTHERMAL STEAM 42.1% OF WASTE DIVERTED FROM LANDFILL

298,000 TONNES RECOVERED FIBRE COLLECTED BY FOREST STEWARDSHIP FULLCIRCLE RECYCLING IN 2014 COUNCIL (FSC®) CHAIN OF CUSTODY (CoC) CERTIFICATION FOR PULP AT BOTH THE KINLEITH AND THE TASMAN MILLS 213,754 TONNES AND FOR PAPER RECOVERED FIBRE UTILISED BY AT KINLEITH MILL KINLEITH AND PENROSE MILLS IN 2014

2014 Kinleith and Internal electricity generation

Tasman Mills 2014 Purchased generate electricity from grid close to half of KINLEITH TASMAN their electricity MILL MILL requirements internally. 47.1% 48.4% 3

PURPOSE OUR BUSINESS & APPROACH 3 | PURPOSE Our business & approach | Who we are 4

Carter Holt Harvey Pulp & Paper Group is one of Australasia’s leading producers of market pulp, paper and fibre-based packaging.

The majority of our operations Market kraft pulps are produced at our are based in New Zealand, where Kinleith and Tasman Mills and used in the manufacture of various papers, we are the sole manufacturer of containerboards and specialty products. kraft pulps, packaging papers and We produce paper products at Kinleith corrugating paperboards for local and Penrose Mills and a range of packaging and global markets. products at our sites throughout New Zealand and Australia. Two service businesses support our manufacturing operations: Lodestar and Fullcircle Recycling.

Leading Carter Holt Harvey Pulp & Paper Group brands include the HI WHITE™ and K25™ market pulps, while containerboards are sold under the FUSION™ banner. The company’s packaging products are used across a range of industries, from produce to manufactured goods. 3 | PURPOSE Our business & approach | Where we are 5

BRISBANE Foodservice – Food packaging, paper cups

SYDNEY Lansvale – AUCKLAND Corrugated packaging Penrose Mill – Recycled fibre corrugating medium Case Northern – Corrugated packaging Paper Bag – Multiwall bags Lodestar Head Office – Shipping, logistics Fullcircle Recycling Head Office – Waste paper collection, MELBOURNE recycling Noble Park – Corrugated packaging HAMILTON Specialty Boards – Pasted board, bulk bins TOKOROA Kinleith Mill – Kraft pulps, packaging papers LEVIN Case Central – Corrugated packaging KAWERAU Tasman Mill – Kraft pulps

CHRISTCHURCH Case South Island – Corrugated packaging

FULLCIRCLE RECYCLING BALING SITE Waste paper collection, recycling 3 | PURPOSE Our business & approach | Environmental sustainability 6

Environmental Our pulp and paper mills source wood sustainability is from plantation-grown forests which core to our activities. are managed to strict environmental Our products are made standards. The majority of this virgin from renewable natural fibre comes from sawmilling and resources: plantation logging residues. These mills source forest-based wood and much of their wood from Forest recovered fibre. Stewardship Council® (FSC®)-certified forests with the balance meeting the eligibility input requirements for ‘controlled wood’ under FSC® criteria.

Recycling and the use of recovered fibre are We continue to focus on the environmental important to our business. Through Fullcircle performance of our operations by powering Recycling’s purpose-built collection facilities them from renewable energy sources, and the use of recovered fibre in our paper responsible management of water resources mills, waste paper from other businesses and diverting waste from landfill. and communities throughout New Zealand Environmental sustainability principles apply is a resource that is recovered and reused. not only to operational performance but also A benefit of having vertically integrated to product design. Our packaging operations manufacturing operations is that residues from work under a continual-improvement one area of the business are used in another – philosophy. We seek opportunities to work with for example, paper trim and cuttings from the customers to minimise waste and facilitate packaging operations are used by our paper- recycling through innovative design and the recycling plants at Kinleith and Penrose Mills. utilisation of high-performance papers.

Environmental Warrant Process Our Certifications and Standards Carter Holt Harvey Pulp & Paper Group In particular: is committed to ensuring responsible 1. Each Business and/or Site Manager is environmental governance and required to list all known environmental management through a framework that risks for relevant operation(s) and to enhances the company’s effectiveness and endorse a Warrant confirming that the ensures a high degree of accountability in list is comprehensive. •• ISO 14001:2004-certified its people. 2. An action plan and timetable including Environmental Management System We hold each one of our people accountable individual responsibilities is prepared to at Tasman Mill for their actions, whatever their role or level address each listed risk or liability. •• ISO 9001:2008-certified Quality of responsibility. 3. A structured risk assessment must be Management Systems at all Carter The business culture is based on honesty completed prior to Warrant renewal. Holt Harvey Pulp & Paper Group and integrity, and cross-company business 4. Independent Warrant audits are carried manufacturing sites ethics training is conducted to help embed out, from time to time, under the •• Forest Stewardship Council® (FSC®) these principles. direction of an appropriately accredited Chain of Custody (CoC) certification environmental auditor. for pulp at both the Kinleith and the Tasman Mills and for paper at Kinleith Mill •• ISO 22000:2005-certified Food Safety Management System at Case Northern, Case Central and Case South Island •• Hazard Analysis and Critical Control Point (HACCP) certification at Paper Bag and Foodservice. 3 | PURPOSE Our business & approach | An integrated business 7

MILL

RECOVERED PAPER PAPER

PULP

WOOD RESIDUES (WOODCHIPS, LOGS)

SAWMILLS

PACKAGING

SUSTAINABLY MANAGED FORESTS

PULP, PAPER AND PACKAGING LOGISTICS CONSUMERS 4

PRODUCTS UNLOCKING THE VALUE OF FIBRE 4 | PRODUCTS Unlocking the value of fibre | Pulp 9

We produce a range of market kraft pulps, each of which has particular attributes for our customers’ specialist end-uses.

HI WHITE™ is a bleached radiata pine kraft pulp valued by customers for its consistency, strength properties, bulk and brightness. Produced at both the Kinleith and the Tasman Mills, HI WHITE™ has a strong reputation with Asia-Pacific paper- makers for suitability in applications such as coated and uncoated printing and writing papers, bleached paperboard, filter papers and tissue products.

HI WHITE LCP™ brand of bleached radiata pine kraft pulp is produced from specially selected woodchips. It is produced at the Tasman Mill and is designed for tissue products where both softness and strength are important qualities for end consumers.

K25™ is a wood pulp used in the production of high-quality cement-based building boards. Developed and manufactured over many years, K25™ is produced at Tasman Mill from specially selected fibre, within a dedicated pulp line and to tightly controlled quality targets. Customers value the special fibre properties and the consistent quality and service levels. 4 | PRODUCTS Unlocking the value of fibre | Paper 10

We produce a range of kraft and recycled fibre-based containerboards for conversion into packaging such as corrugated cases.

HI GOLD™ is a premium light shade, high- strength liner for performance packaging with superior visual appeal.

GRAPHIX™ is a high-strength white liner ECOKRAFT™ is a kraft and recycled liner that delivers quality graphics. for performance in standard packaging conditions.

Kinleith Mill containerboard products meet the requirements of US 21CFR176.170c for contact with dry, moist and fatty foodstuffs in applications requiring filling CLIMATE™ is a high-performance medium ECOFLEX™ is a fully recycled medium for or pasteurising at temperatures below for use in high-humidity, cool-store use in standard packaging environments. 212˚F (100˚C). Testing for heavy metals and environments a range of other substances such as those covered by EU Directive 2011/65/EU on the restriction of the use of certain hazardous substances in electrical and electronic equipment (RoHS) and the European Parliament and Council Directive 94/62/EC on packaging and packaging waste also reconfirms the safety of our products. 4 | PRODUCTS Unlocking the value of fibre | Packaging 11

Our packaging operations in Australia and New Zealand pride themselves on their innovative products and on their ability to provide smart packaging solutions.

Corrugated Packaging

We supply an extensive range of cardboard products to the Australasian market. Our facilities produce a comprehensive selection of cardboard products for numerous industries including: horticulture, dairy, meat, beverage, seafood, reseller and industrial manufacturing.

Multiwall Bags

We specialise in complex multiwall bags where product integrity and efficient distribution are critical, supported by high- quality graphics. Our product range includes bags for the dairy, cement, flour and sugar industries from 5kg sizes through to 50kg industrial bags.

Specialty Boards Paper Cups

Our specialty boards are used in the We manufacture paper cups for a wide manufacture of heavy-duty packaging, variety of uses including cold drinks, hot packaging for frozen and chilled beverages, hot chips, ice cream, popcorn products, point-of-sale displays, ring and many other products which benefit binders and game boards as well as in from being presented in well-designed countless industrial applications. We also packaging. The major market segments we manufacture a range of other specialty service include: quick-service restaurants, products including solid fibre slipsheets food-court franchisees, coffee roasters, and bulk bins. ice-cream chains, cinemas and theme parks, convenience stores and service stations throughout New Zealand and Australia. 4 | PRODUCTS Unlocking the value of fibre | Our service functions 12

Two service businesses support our manufacturing operations: Lodestar and Fullcircle Recycling.

Lodestar services include: • Domestic distribution via road, rail and coastal shipping • Inter-modal port services including Lodestar is a logistics business operating product handling, storage and packing and managing shipping services for Carter Holt Harvey Pulp & Paper Group and other • International shipping utilising containers New Zealand companies to and from a and break-bulk services number of markets, particularly Australia • Comprehensive export documentation and Asia. Lodestar specialises in shipping and international trade finance advisory project cargoes, forest products and bulk/ services break-bulk cargoes on a flexible and cost- • International onshore logistics services at effective basis. selected destinations.

Fullcircle Recycling provides a range of collection and recovery services for businesses, households and councils throughout New Zealand. Fullcircle Recycling collects nearly 300,000 tonnes of recovered paper each year, of which, in 2014, 213,754 tonnes were used in Carter Holt Harvey Pulp & Paper Group’s own paper mills for conversion into FUSION™ products. The balance either is sold domestically for reuse by other businesses or is exported. Fullcircle Recycling has paper collection and baling operations throughout New Zealand. It has long-term strategic relationships with many regional recyclers across the country. 13

PLANET RESPONSIBLE SOURCING OF FIBRE 5 | PLANET Responsible sourcing of fibre | How we source our virgin fibre 14

Our pulp and paper Carter Holt Harvey Pulp & Paper mills source wood from Group expects all suppliers to be plantation-grown forests in compliance with environmental in New Zealand. regulations and the company’s wood-sourcing policy. We provide further surety of the environmental integrity of our products by maximising independently certified fibre within our wood supply

Sustainable Forestry in New Zealand Plantation forestry in New Zealand is controlled by national legislation, which protects a range of societal and TOPLOG 2 environmental values. Of particular Used for pulp significance are New Zealand’s Resource Management Act (1991), the Conservation Act (1987) and the Forests Act (1949). Collectively, these laws protect indigenous forests and require plantation foresters to manage TOPLOG 1 biosecurity, health and safety, historical and Used for pulp, cultural values, and environmental risk. timber products

The New Zealand Forest Accord All New Zealand-sourced virgin pulp and paper- making fibre comes from introduced species, notably radiata pine and eucalyptus, almost SLABWOOD all of which is plantation grown specifically Used for pulp for harvest. In 1991, the New Zealand forest industry and local environmental groups, such as the Royal Forest and Bird Protection Society of New Zealand Inc., entered into an SAWLOG 2 Accord. The New Zealand Forest Accord is an Used for timber agreement prohibiting the clearance of natural products, building indigenous vegetation to establish production- furniture based forests. We continue to adhere to the principles of the Accord today.

How we Source our Virgin Fibre Wood supply comes from externally SLABWOOD owned plantation forests, primarily Used for pulp located within the Central North Island region of New Zealand and supplemented from elsewhere in the North Island. Much of this wood consists of residues from other SAWLOG 1 sectors in the forest industry including top Used for timber logs (unsuitable for timber production) products, building and sawmill ‘slab wood’ chips which come furniture from offcuts and squaring up logs in the production of timber. 5 | PLANET Responsible sourcing of fibre | How we source our virgin fibre 15

Our certifications: Kinleith and Tasman Mills source as International Illegal Logging Laws FSC® Chain of Custody much of their wood as is practicable A number of countries now prohibit the certification. from FSC®-certified forests with the importation of illegal wood products and impose a responsibility on importers to balance meeting the eligibility input demonstrate the legality of wood products requirements for ‘controlled wood’ including paper and paper packaging under FSC® criteria. products. New Zealand is recognised by independent authorities as a low-risk country in relation to illegal logging. The vast majority of New Zealand’s forest products are derived from sustainably managed exotic plantations consisting of low-risk species. A much larger estate of indigenous forests (30% of the Kinleith and Tasman Mills both have With FSC® Chain of Custody (CoC) country’s land area) is managed separately for FSC® Chain of Custody certifications. certification, an organisation may certify a conservation by the New Zealand government. This ensures wood can be tracked from the product as ‘FSC® 100%’, provided all fibre point of harvest through to the finished is sourced exclusively from FSC®-certified New Zealand has a comprehensive regulatory product delivered to our customers. forest. Products can be certified as ‘FSC® framework for forestry, a professional Mix’ where ‘controlled wood’ sources are enforcement regime and very low levels of The FSC® systems employed at the Kinleith blended with FSC®-certified wood input. non-compliance. and Tasman Mills mean the mills are able to supply significant tonnages of kraft pulp Controlled wood is sourced from forests For more information on the New Zealand ® and paper with an ‘FSC® Mix’ sources claim. which are not FSC -certified but meet government position on the risks of illegal specific criteria. logging practices occurring in New Zealand, go to: http://archive.mpi.govt.nz/Portals/0/ Documents/forestry/forestry-nz/illegal-log/ the-legality-of-new-zealands-forestry- products.pdf

Wood Sourcing Policy

It is the policy of Carter Holt Harvey Pulp & Paper Group that all virgin wood fibre procured for the manufacture of pulp and paper has been verified in accordance with the company’s best efforts, to not come from any of the following category sources: • Illegally harvested wood • Wood harvested in violation of traditional and civil rights • Wood harvested in forests in which high conservation values are threatened by management activities • Wood harvested in forests being converted from natural and semi-natural forest plantations or non-forest use • Wood from forests in which genetically modified trees are planted. 5 | PLANET Responsible sourcing of fibre | Common questions 16

What is FSC® certification? What is Chain of Custody? Does the use of virgin fibre deplete The Forest Stewardship Council® (FSC®) Chain of Custody is a formal stewardship native forests? is a global not-for-profit organisation programme that ensures the traceability No; not in New Zealand, where Carter Holt established to promote responsible of wood fibre from certified forest through Harvey Pulp & Paper Group sources wood management of the world’s forests. all stages of processing, manufacturing from plantation-grown forests. Plantations The FSC® has developed a set of principles and distribution to the point of sale of displace the felling of natural forests both in and criteria which describe the rules of the certifiable finished product. Third- New Zealand and overseas. forest management in regards to being party assessment and certification at ‘environmentally appropriate’, ‘socially each successive change in ownership beneficial’ and ‘economically viable’. Forests give consumers and other stakeholders that meet the criteria are certified following assurance that wood, paper and building independent audit. The products from these products have originated from forests that forests are, therefore, eligible to carry the are responsibly and sustainably managed FSC® label, subject to Chain of Custody as claimed. requirements, giving consumers confidence Chain of Custody certification is a that they originate from responsibly mandatory component of every stage of managed forests. the supply chain for FSC® and some other certification schemes.

What other certifications are there? Can paper and board be made entirely Do tree plantations mean an end Chain of Custody audit and certification from recycled fibre? to biodiversity? systems are offered by a number of Yes; some papers and boards are No; Carter Holt Harvey Pulp & Paper Group’s organisations globally; two of the most manufactured using only recycled fibre. forestry suppliers have voluntary industrial widely recognised are the FSC® and One example is the corrugating medium agreements in addition to statutory the Europe-based Programme for the made at the Penrose Mill. Many papers obligations to protect wildlife populations Endorsement of Forest Certification contain both virgin and recycled fibres in within their forest estates. (PEFC™). varying proportions, managed according Others include the Sustainable Forestry to end-use requirements. There are good Initiative® in the USA and the Australian reasons to use at least a proportion of virgin Forest Certification Scheme (AFCS), which fibre in some papers. For example, selective certifies forests according to the Australian use of stronger virgin fibres is managed to Forestry Standard endorsed by PEFC™. achieve desired strength-to-weight ratios of paperboard packaging. The differences between alternative certification schemes are, mostly, matters of Even if fibres were never to ‘wear out’, Is 100% recycled paperboard packaging detail and customer/consumer preference. there will always be a need for virgin fibre suitable for direct food contact? Certification systems build upon, rather for some end-uses and to allow for supply- 100% recycled paperboard can be than replace, the ‘sustainable management chain losses such as with consumable suitable for direct food contact, subject of the environment’ obligations implicit in paper products. to appropriate controls and testing, and Australian and New Zealand legislation. is currently used in a number of direct- contact applications by consumer product companies. 5 | PLANET Responsible sourcing of fibre | Sourcing high-quality recovered fibre 17

The collection We operate New Zealand’s largest Fullcircle Recycling offers a range of and recovery of paper recycling business – recycling services for businesses and Fullcircle Recycling. households throughout New Zealand; reusable paper the Kinleith and Penrose Mills used are valuable approximately 213,754 tonnes of cardboard phases of our and paper collected by Fullcircle Recycling operations. in 2014. Recycled fibre is used in our ECOFLEX™ and ECOKRAFT™ product ranges and in a range of our packaging products.

298,000 TONNES RECOVERED FIBRE COLLECTED BY FULLCIRCLE RECYCLING IN 2014

Complementary Fibres: Virgin fibres play a unique role in certain depend on the full life cycle of the products. Virgin and Recovered Fibre applications, particularly where high There are good reasons to use at least a humidity is present, where high strength proportion of virgin fibre in many papers, Most fibre-based packaging is needed or where appearance and print especially where the end product needs contains both virgin and recycled quality are important. Recovered fibres can to perform in demanding conditions. If fibres in different proportions. be a better economic choice: for example, packaging fails, then any environmental Producing an effective and durable in conditions with lower performance gains achieved through increasing the requirements. Our ECOKRAFT™ range of recycled fibre content can be quickly lost product is not about choosing one kraft-top liners made at Kinleith Mill is through damage or spoilage of the packaged or the other. Instead, it is about an example of a hybrid combination of product. There will always be a need for deciding how much of each to use virgin fibre on the surface for colour and virgin fibre from responsible sources because to ensure the product will do the consistency and recovered fibre as the recycled fibre degrades after use and not job required of it. balance of material. The environmental all fibre can be recovered, regardless of the benefits of virgin versus recovered fibre efficiency of the recovery process.

i i

Did you know? Did you know? New (virgin) fibres need Paper and cardboard can to be introduced into the be recycled many times paper-making process to (typically estimated at make up for permanent between five and eight removals and maintain the cycles), after which the supply and performance of fibres making up paper the finished products. ‘wear out’. 5 | PLANET Responsible sourcing of fibre | Common question 18

What is the The carbon cycle is a complex natural Once trees are harvested, they release process through which carbon is exchanged emissions as wood products degrade or relationship between between the atmosphere, the ground, where they are burned as a fuel. Sustainably forest products and plants, animals and the oceans. managed forests protect the overall cycle the carbon cycle? Most of the important exchanges involve as they are replanted, continually ensuring carbon dioxide (CO2) forming a cycle as overall CO2 absorption is maintained. depicted in the diagram. The net effect is to reduce greenhouse concentrations and mitigate climate change. Human activities over the last few centuries have led to increased CO2 emissions, for example through the burning of fossil fuels. Forestry and wood processing have important roles to play in reversing the trend. Trees absorb CO2 as they grow.

The Relationship between Forest Products and the Carbon Cycle

FLOW OF CO2

ATMOSPHERE

PAPER BUILDING PRODUCTS & PRODUCTS PACKAGING Long-term PULP & Carbon stored carbon storage PAPER and recycled MILLS in paper and paperboard Significant products biofuel usage WOOD SAWMILLS RESIDUES, Significant FEEDSTOCK biofuel usage & BIOFUEL

LOGGING RESIDUES SAWLOGS

HARVEST

HUMAN NATURAL LOGGING SUSTAINABLY OCEANS ACTIVITY FORESTS MANAGED Transportation, Stored carbon is FORESTS manufacturing and released through Forests absorb thermal electricity decay in proportion CO2 in their growth generation emit to growth. processes and release CO from fossil fuels. 2 O2 (photosynthesis). 19

PROCESS STRIVING FOR OPERATIONAL EXCELLENCE 6 | PROCESS Striving for operational excellence | Our pulp and paper manufacturing operations 20

All of our pulp and paper manufacturing operations at Kinleith, Tasman and Penrose Mills are located strategically in New Zealand.

Our fibre processing operations at Kinleith Mill the Kinleith and Tasman Mills are Kinleith Mill is the company’s largest site, with located in New Zealand’s largest a production capacity of more than 600,000 forest region. The Penrose Mill, tonnes per annum of packaging papers and which utilises only recovered bleached softwood kraft market pulp. It uses fibre, is located close to Fullcircle plantation softwood radiata pine, plantation- grown eucalyptus and recovered fibre as its fibre Recycling’s Auckland operation. sources. Most of the market pulp is exported Auckland is the largest municipal globally for use in the manufacture of printing source of recycled paper. and writing papers, boards and tissue. Kinleith The Kinleith and Tasman Mills operate Mill is well known for its range of high-strength, chemical plants to support their pulp- visually appealing kraft linerboards and medium, bleaching operations. Some of the plant used in the manufacture of corrugated cases. capacity is utilised to produce chemicals for the market: specifically, liquid chlorine Tasman Mill for municipal water treatment, sodium The Tasman Mill has a capacity of hypochlorite (concentrated household approximately 300,000 tonnes per annum bleach) and hydrochloric acid. of bleached and unbleached kraft market Two wood-based byproducts from the pulps, used by manufacturers of high- kraft pulping operations are sold for other quality paper, tissue and building products. industrial uses: crude tall oil (a precursor Tasman’s fibre is sourced predominantly for a range of industrial chemicals and from radiata pine. Tasman’s fibre cement resins) and crude sulphate turpentine, to be pulp is acknowledged in the fibre-cement refined and used in the production of a wide building products industry as a premium range of chemicals from perfume bases to cellulose-reinforcing fibre. disinfectants. Pulp bleaching at both mills is accomplished using oxygen delignification followed by an elemental chlorine-free (ECF) process that Penrose Mill avoids the risk of forming traces of dioxin. The Penrose Mill manufactures approximately 85,000 tonnes per annum of corrugating medium from recovered fibre, sourced through Fullcircle Recycling. The recovered fibre consists of post-consumer waste paper from around New Zealand. As with our Kinleith Mill containerboard, Penrose Mill products are used in the manufacture of corrugated cases. 6 | PROCESS Striving for operational excellence | Our packaging manufacturing operations 21

Our Australian and New Zealand Packaging operations are committed to using sound, sustainable principles in their business operations: from using papers made from well-managed plantation and recycled fibre through to the production processes employed, the efficient use of resources and the minimisation and recycling of waste.

Corrugated Packaging

We have more than 50 years’ experience in the cardboard packaging industry. Our cardboard packaging manufacturing plants are located in Auckland (Case Northern), Levin (Case Central), Christchurch (Case South Island), Melbourne (Noble Park) and Sydney (Lansvale).

Multiwall Bags

We have been manufacturing multiwall bags at our Paper Bag facility in Auckland since 1948. We currently manufacture in excess of 100 million bags annually, of which more than 30 million go to customers in export markets.

Specialty Boards Paper Cups

Our quality pasted board products have We have been manufacturing paper cups been manufactured for more than 50 years at at our plant in Brisbane for 30 years. our Specialty Boards plant in Hamilton, We produce more than 120 million cups New Zealand. Our solid fibreboard products per year. are manufactured by laminating layers of paper together to form a solid fibreboard sheet. 6 | PROCESS Striving for operational excellence | Energy 22

Powering our In 2014, Carter Holt Harvey Pulp Energy sources across Carter Holt Harvey Pulp operations from & Paper Group’s manufacturing & Paper Group’s manufacturing businesses in operations sourced 73.8% of the direct Australia and New Zealand in 2014 are illustrated sustainable on page 23. energy required by its manufacturing energy sources. Electricity greenhouse gas emissions in operations from biomass (wood New Zealand are small compared with world residues and kraft black liquor), whilst averages because generation is largely from 80.2% in total came from renewable renewable sources – hydro, geothermal and sources (biomass and geothermal wind. The proportion varies with weather steam). Renewable sources reduce patterns but, as shown on page 23, both dependence on fossil fuels and New Zealand’s grid electricity was 79.9% renewable in 2014. In Australia in 2012/2013, greenhouse gas emissions. approximately 13.0% was renewable.

73.8% CARTER HOLT HARVEY PULP & PAPER GROUP’S ENERGY FROM BIOMASS

373,355,833 kWh TOTAL INTERNAL ELECTRICITY GENERATION

2014 Internal electricity Kinleith and generation

2014 Tasman Mills Purchased generate electricity from grid KINLEITH TASMAN close to half of MILL MILL their electricity requirements internally. 47.1% 48.4% 6 | PROCESS Striving for operational excellence | Energy 23

Manufacturing Operations: Energy Sources, 2014

73.8% Biomass

6.4% Purchased geothermal steam 80.2% 0.3% Coal RENEWABLE ENERGY 1.6% Oil-based fuels (BIOMASS, 10.7% Natural gas GEOTHERMAL STEAM) 1.3% Purchased steam Contribution from purchased electricity is not included. 5.9% Purchased electricity

Electricity Generation by Energy Source and Country

NEW ZEALAND AUSTRALIA WORLD (2014)1 (2012/2013)2 (2012)3 Total renewable sources: Total renewable sources: Total renewable sources: 79.9% 13.0% 21.2%

1.3% BIOMASS GEOTHERMAL/WIND/ 5.0% 4.4% WIND/SOLAR SOLAR/BIOMASS/WASTE 7.3% HYDRO 16.2% GEOTHERMAL STEAM 16.2% HYDRO

5.2% WIND/SOLAR 20.5% NATURAL GAS 1.4% BIOMASS

1.8% OIL 0.8% OTHER NON-RENEWABLE 22.5% NATURAL GAS

5.0% OIL 57.1% HYDRO

63.9% COAL Sources: 40.4% COAL 1 New Zealand Energy Quarterly; December Quarter 2014 (MBIE: www.med.govt.nz) 2 2014 Australian Energy Update, Other Non-renewable July 2014 (Bureau of Resources and Energy Economics: www.bree.gov.au) 15.6% NATURAL GAS

3 Key World Energy Statistics 10.9% NUCLEAR 2014 (International Energy 0.1% OTHER NON-RENEWABLE Agency: www.iea.org) 4.4% COAL 6 | PROCESS Striving for operational excellence | Water 24

Responsible management of water resources.

Carter Holt Harvey Pulp & Paper Water is used and reused in all major process municipal supplies. Although our pulp and Group has always strived to use stages: e.g. for woodchip washing, for pulp paper mills (and indeed, the pulp and paper and manage water in a responsible washing and screening, and in the paper industry as a whole) are large users of fresh machines. Water is used also for process water, they consume only a small amount of manner. In New Zealand, our mills cooling, equipment cleaning and general the water that they use; the majority is treated have a responsibility to use, treat facilities operations, and to generate steam and discharged. and monitor water in accordance for use in processes and on-site power with their environmental consents generation. under the Resource Management Our pulp and paper mills withdraw water from Act (RMA). surface water sources (i.e. streams and rivers), ground-water sources (i.e. aquifers) and

Manufacturing Operations: Water-quality Management Tasman Mill – Sources of Water, 2014 Effluent Colour-reduction Programme Kinleith and Tasman Mills discharge treated process water into local rivers. The company recognises that effluent The discharges are subject to resource colour discharges are an amenity concern 1% consent requirements. They are monitored for the local community. Colour reduction Municipal supply regularly and reported for a range of continues to be a priority at Tasman Mill. parameters including total suspended solids, In 2014, the 30-day average colour load biochemical oxygen demand and colour. was 15.1 tonnes per day (Pt-Co Equivalent), Penrose Mill manages its waste water to more than 38% lower than it was in 2007, meet the standards required for discharge and well below the regulatory limits of into the council-provided trade waste 31 tonnes per day. Carter Holt Harvey Pulp system. & Paper Group is committed to further reductions with ambitious targets over the long term for the Tasman Mill. We are currently ahead of the 2018 targets and aim to reduce colour by more than two- thirds of 2010 levels by 2035.

21% Ground water 78% Surface water 6 | PROCESS Striving for operational excellence | Waste 25

Diverting waste from landfill.

Carter Holt Harvey Pulp & Paper Group is a major user and recycler of both its own waste and waste from customers and others. In 2014, 42.1% of solid wastes produced from our manufacturing operations were diverted from landfill. Most of the diverted material (32.8%) was recovered fibre and was recycled within our processing plants. A further 9.2% of our wastes was composted or vermicomposted to form soil-conditioning products. A contractor has been using worms to vermicompost all primary solids from the Manufacturing Operations: Waste Destinations, 2014 Kinleith Mill effluent treatment system since 2010 and similar composting operations have been developed to receive residual wastes from landfill at the Tasman and Penrose Mills in recent years. In 2014, vermicompost and compost 0.1% operations enabled us to divert Hazardous waste 4,795 (dry) tonnes of mixed solids from the Kinleith Mill, 1,043 (dry) tonnes of solids 9.2% from the Tasman Mill and 1,465 (dry) tonnes To compost/ of solids from the Penrose Mill. vermicompost

32.8% To recycle

42.1% 57.8% OF WASTE To landfill DIVERTED FROM LANDFILL 26

PARTNERSHIP COLLABORATION WITH OUR STAKEHOLDERS 7 | PARTNERSHIP Collaboration with our stakeholders | Innovation for success 27

Innovation is key Our packaging teams are always We have a New Product, Service and to everything we do at looking for ways to improve the Development (NPSD) team, which operates consumer appeal of our packaging as an independent functional group, Carter Holt Harvey Pulp supporting all packaging operations in & Paper Group. We are to ensure the success of our New Zealand. Its aim is to generate working continually customers’ brands. innovative ideas from within our business in innovative ways to and provide smart solutions to meet our raise the standard of our customers’ requirements. A key focus of service and products. NPSD is substituting traditional forms of packaging with fibre-based solutions.

Innovation proves itself to be a winner.

The Paper Cups team worked The cup has a coupon ‘tear-off disc’ on the This unique promotional tool was used closely with two external print outer wrap. This enables customers to run recently in two promotions and more are houses to develop a new special promotions or competitions with the planned. We were pleased to see it used for relevant information contained on the inside a competition at the recent Racing Spring promotional cup for its customers of the disc. The final customer tears off the Carnival across Australia – the major prize in 2014. disc to access the info/entry information. was a trip to Italy for the winner. The disc is part of the outer wrap and this eliminates the previously used ‘Peel & Reveal’ labels which are both costly and difficult to process. 7 | PARTNERSHIP Collaboration with our stakeholders | Partnering for success 28

Packaging New Zealand wins gold.

Packaging New Zealand was The awards showcase and recognise the Packaging New Zealand worked closely with recognised with a Gold Medal very best in print across all mediums and Freshmax to convert an art concept into a are the pinnacle of achievement in the in the 2014 New Zealand pack that stands out in the supermarket. printing industry. The packs were printed at Case Northern Pride In Print Awards. Judging was based on technical excellence on GRAPHIX™ white top kraft linerboard, in all facets of the production process sourced from Kinleith Mill. including equipment capability, design, materials and innovation. This award was made possible as a result A gold medal was awarded to the Mahana of significant investment made in print and Red open-top apple pack that was made drying capability at Case Northern, and was for New Zealand fruit marketer Freshmax supported strongly by our pre-press partner and used to promote and sell Mahana Red Gravitas Media through their digital files apples in New Zealand supermarkets. management and new plate technology.

Packaging New Zealand wins prestigious customer satisfaction award.

At the Fonterra Packaging Awards Each Fonterra site goes through a rigorous This award was particularly significant as held in Hamilton in September process where it is asked to rank its top it recognised the contribution made by the 2014, Packaging New Zealand was three suppliers, based on a comprehensive packaging teams in New Zealand who work survey questionnaire. All packaging hard to ensure that service and product awarded the New Zealand Milk suppliers were rated on six key criteria: delivery to Fonterra is never compromised. Products (NZMP) Packaging Site •• Ease and speed of contact Fonterra is an extremely important Buyer Satisfaction Award in •• Consistent delivery above and customer and we are proud to be recognition for services provided beyond expectations recognised in this way. to Fonterra sites around •• Quality New Zealand. •• Accuracy and timeliness of information •• Flexibility and responsiveness •• Professionalism around complaint and resolution management 7 | PARTNERSHIP Collaboration with our stakeholders | Working together with local communities 29

Collaboration offers work opportunities and environmental benefits.

Altus Enterprises employees Heather Parker (left) and Narelle Pemberton (right) with Paul Stoneman, GM Altus Enterprises (centre)

Fullcircle Recycling has partnered Between Fullcircle Recycling and Altus As part of the arrangement, Fullcircle with Altus Enterprises to provide Enterprises, we are diverting waste from Recycling supplied and installed a conveyor multiwall bag recycling services. landfill for reuse. Recovered materials are system and baler at Altus Enterprises’ reused at Carter Holt Harvey Pulp & Paper premises. The stripped bags are placed on Altus Enterprises employs people Group manufacturing processes or sold. the conveyor after the plastic liners have been with disabilities who will recover the This partnership supports the ongoing removed and this transfers the bags from the plastic linings from multiwall bags employment of 30 people who live with manual workstations into storage bins which allowing both the fibre portions and disabilities. are later collected. the plastic portions of the bags to be The repetitive nature of the work requires a Over the course of a year, it is anticipated the recycled readily. great deal of perseverance and, according throughput of the new facility will be around to Paul Stoneman, General Manager of Altus 1,400 tonnes of fibre for recycling in the Enterprises, is an ideal task for the majority of Kinleith and Penrose Mills. his employees.

Altus Enterprises staff remove the plastic liners of multiwall bags at their new facility in Henderson, Auckland. The bags will be baled up and transported to Kinleith Mill for recycling.

The new conveyor system installed by Fullcircle Recycling at Altus Enterprises’ Henderson facility is being utilised by Altus Enterprises staff. 7 | PARTNERSHIP Collaboration with our stakeholders | Working together with local communities 30

Working together with local communities.

Way to Run! The Kinleith Fun Run and Walk

The Kinleith Fun Run and Walk, held in The Kinleith Wellness Committee was November 2014, was a fantastic event for established in 2011 to encourage our all employees, friends and families of Carter employees to start taking a proactive Holt Harvey Pulp & Paper Group. The event approach to their health and well-being. had 5km and 10km races, and 1km and 2km The committee is employee led; it consists races for children, with 280 participants of employees and site-based contractors. enjoying the day. The Kinleith Wellness Committee has run seminars and other initiatives to educate employees on nutrition, sleep issues, building resilience, and cancer awareness and prevention.

Participation in Industrial Symbiosis Kawerau Bay of Connections Forestry and Wood Action Group community-led initiatives. A group of businesses and local authority leaders located in Kawerau is working to This is a group focused on developing adopt practices leading to smarter, economic growth for the forestry and cleaner businesses. wood processing sector in the wider Bay of Plenty region.

Healthy Rivers: Plan for Change Wai Ora: He Rautaki Whakapaipai

A Waikato and Waipa River iwi and Waikato Regional Council project that is working with stakeholders to develop changes to the Waikato Regional Plan to help restore and protect the health of the Waikato and Waipa Rivers. 7 | PARTNERSHIP Collaboration with our stakeholders | Passionate people 31

It is important to attract In 2014, we were actively involved in young students and our local communities, profiling the graduates into our careers we offer. business, particularly those with passions for jobs in technology, engineering and science.

Kawerau Careers Expo Carter Holt Harvey Pulp & Paper – Appita New Speakers Contest Engineering Design Show Employees from the Tasman Mill attended The Australasian Pulp and Paper Industry the Kawerau Careers Expo. Sharing a stand The Carter Holt Harvey Pulp & Paper – Technical Association (Appita) New Speakers with the Australasian Pulp and Paper Industry Engineering Design Show is a two-day Competition was held at the Appita Fibre Technical Association (Appita), the team event during which second, third and Value Chain Conference & Expo in Rotorua in highlighted the Tasman Mill’s product range fourth-year engineering students from October 2014. and the diversity of careers available. Process the University of Waikato showcase Christy Tan from Kinleith Mill spoke on Engineer Nyssa Brewer gave an interesting their research and design projects in the the ‘No.1 Pulp mill heat exchanger scaling presentation on her role to a group of senior forms of posters, displays and seminars. reduction project’, and Kelly Holden, science students. Topics included Chemical and Biological Tasman Mill spoke on ‘Optimising power Engineering, Electronic Engineering, generation at Tasman Mill’. The standard Materials and Process Engineering, of both presentations was very high and Mechanical Engineering and they were excellent representatives for their Software Engineering. mills. Christy Tan won the competition and The event provided a great opportunity received a prize of A$4,000 for professional for both high school students and development. industry representatives to meet talented engineering students.

Steven Woollacott, Nyssa Brewer, Winner Technical Manager, Process Engineer, Christy Tan, Tasman Mill, and Tasman Mill Process Desirae Kirby, Research Engineer, Programme Manager, Kinleith Mill Tasman Mill, at the shared Appita – Carter Holt Harvey Pulp & Paper Group stand 7 | PARTNERSHIP Collaboration with our stakeholders | Collaboration with the wider industry 32

Carter Holt Harvey Pulp & Paper Group actively participates in public discourse, including engagement with industry bodies.

We also make submissions to the Australian and New Zealand governments at both central and state or regional levels, where it is relevant to the business and in the interests of our customers.

Wood Processors & Manufacturers Appita – Australasian Pulp and Paper Association (WPMA) of New Zealand Industry Technical Association

The Wood Processors & Manufacturers Appita facilitates the network of Association brings together all parts of stakeholders to advance the technical New Zealand’s wood supply chain in one capability and expertise of the Australian industry organisation to give strength and and New Zealand pulp and paper industry. unity to the challenges facing the industry.

Other memberships include: New Zealand Paper Forum Australian Packaging Covenant •• New Zealand Forest Owners Association The New Zealand Paper Forum was The Australian Packaging Covenant (APC) •• Packaging Council of New Zealand established with a mandate to represent the has been in effect since 1 July 2010. •• Major Electricity Users’ Group interests of all parts of the paper supply The covenant focuses on improved •• New Zealand Manufactures and Exporters chain from manufacturers and importers to packaging design, ‘away from home’ Association (NZMEA). printers, publishers and recyclers. recycling, litter reduction and increased engagement across the supply chain through product stewardship. 33

PERFORMANCE DATA & TRENDS FROM 2014 8 | PERFORMANCE Data & trends from 2014 | Pulp and paper manufacturing operations 34

KINLEITH MILL TASMAN MILL PENROSE MILL Principal Products Bl, UB SW kraft pulps, packaging papers; Bl, UB SW and HW kraft pulps; pulping Recycled fibre pulping byproduct and chlor-alkali chemicals byproduct and chlor-alkali chemicals corrugating medium ` UNIT ANNUAL TOTALS Outputs1 Pulp and paper products tonne 579,744 273,247 85,010 Chemicals and byproducts tonne 18,973 16,907 N/A Total output tonne 598,717 290,154 85,010 Group output net of inter-mill transfers tonne 967,697 Raw Materials Fibrous inputs Wood, new pulp/paper/cores tonne 2,228,257 1,320,552 223 Recovered fibre tonne 108,518 N/A 105,236 Total fibre tonne 2,336,775 1,320,552 105,459 Other inputs (approximate) tonne 63,600 38,200 716 Other significant inputs include: Alum, Bale wire, Burnt lime, Caustic Bale wire, Burnt lime, Caustic soda, Starch soda, Calcium carbonate, Clay, Hydrogen peroxide, Lime rock, Hydrogen peroxide, Oxygen, Paper Magnesium sulphate, Oxygen, Salt, size, Salt, Starch, Sulphuric acid Saltcake, Sulphuric acid Energy Consumption Direct sources Biomass: kraft black liquor, wood residues GJ 14,395,807 7,100,437 N/A Fossil fuels2: natural gas, waste oil fuel, fuel oil, coal, diesel, petrol, LPG GJ 2,753,037 722,126 17,107 Indirect sources (purchased) Electricity GJ 1,077,485 409,252 158,494 Steam GJ N/A N/A 388,034 Geothermal steam GJ N/A 1,871,399 N/A Total energy consumption GJ 18,226,329 10,103,214 563,635 Total energy consumption per tonne of total output GJ/t 30.44 34.82 6.63 Energy from renewable sources3 % 79.0% 88.8% 0% Electricity generation GJ 960,035 384,045 N/A Electricity generation vs total electricity consumption % 47.1% 48.4% N/A Water Take Municipal supply M 0 42 291 l Surface water M 19,836 22,672 0 l Ground water M 10,852 0 382 l Total water take M 30,688 22,714 673 l Emissions to Air 4 Scope 1 (direct) emissions (CO2-e) tonne 164,419 48,085 1,114

Scope 2 (indirect) emissions (CO2-e) tonne 38,825 34,666 25,572 4 Total Scope 1 and 2 emissions (CO2-e) tonne 203,244 82,751 26,686 4 Scope 1 and 2 emissions (CO2-e) per tonne of total output t/t 0.339 0.285 0.314 5 Biomass CO2 emissions tonne 1,331,065 667,804 0 Particulates tonne 474 342 N/A

Total Reduced Sulphur (TRS) (as H2S) tonne 89 42 N/A Waste6 To landfill dry tonne 25,158 11,037 8,738 To recycle dry tonne 1,068 99 0 To compost/vermicompost dry tonne 4,795 1,043 1,465 Hazardous waste (removal by licensed contractors) tonne 3 63.227 0 Discharge to Water 8,9 Volume M 31,395 23,247 570 l Treatment 1° and 2° 1° and 2° N/A Receiving water Waikato River Tarawera River Municipal sewer Total Suspended Solids (TSS) tonne 911 1,334 65610 Biochemical Oxygen Demand (BOD) tonne 533 1,325 1,37210

A zero (0) in the table signifies that such inputs, discharges, 4 CH4 and N2O emissions from combustion of biomass are included. 9 Volume estimated for Tasman Mill and excludes contributions emissions or wastes do not occur (or may occur only below detection 5 Biomass-derived CO2 is reported separately for information in from Norske Skog Tasman newsprint mill and stormwater. limits). ‘N/A’ signifies that the parameter is considered not relevant accordance with the GHG Protocol. 10 Measurements taken prior to municipal water treatment process for that site. 6 Waste to landfill is reported on a ‘dry solids’ basis; and deposited at Penrose Mill only. 1 Outputs are listed by mill; group output is net of transfers in facilities owned by Carter Holt Harvey Pulp & Paper Limited or Market pulp tonnages are expressed on an ‘air dry’ or 90/10 basis, between the mills. licensed third parties. under which pulp weights are derived by normalisation to 90% dry 2 Direct sources from on-site stationary and mobile (vehicular) 7 Demolition waste. pulp solids, 10% moisture content, which is standard for the industry. combustion of fossil fuels. 8 Discharges listed for Tasman Mill (except for volume) include Global Warming Potentials for this report are sourced from 3 Energy from biomass and geothermal steam. Renewable energy those from the neighbouring newsprint mill owned and operated the Intergovernmental Panel on Climate Change (IPCC) Fourth contribution from purchased electricity is not included. by Norske Skog Tasman due to shared waste-water treatment Assessment Report (2007), in line with New Zealand GHG Reporting infrastructure. Standards in force from January 2013. 8 | PERFORMANCE Data & trends from 2014 | Pulp and paper manufacturing operations 35

Selected key indicators (indexed to output) for 2014 relative to 2007 (base year).

Kinleith Mill

20 Total energy consumption

10 Scope 1 and 2 emissions (CO2-e)

2007 BASE 0 Water take –10 Waste to landfill –20 Renewable energy % Change –30 Electricity generation –40

–50

–60 2008 2009 2010 2011 2012 2013 2014

Tasman Mill

20 Total energy consumption

10 Scope 1 and 2 emissions (CO2-e) 2007 BASE 0 Water take –10 Waste to landfill* –20 Renewable energy –30 % Change Electricity generation –40

–50 * 2007–2012 waste to landfill data based on estimates for Tasman Mill –60 2008 2009 2010 2011 2012 2013 2014

Penrose Mill

30 Total energy consumption

20 Scope 1 and 2 emissions (CO2-e)

10 Water take

2007 BASE 0 Waste to landfill

–10

–20 % Change

–30

–40 2008 2009 2010 2011 2012 2013 2014 8 | PERFORMANCE 8 | PERFORMANCE ContentsData & trends from 2014 | Packaging manufacturing operations 36 Data & trends from 2014 | Packaging manufacturing operations 37

PACKAGING AUSTRALIA PACKAGING NEW ZEALAND Selected key indicators (indexed to output) for 2014 Principal Products Corrugated shipping cases, Shipping cases, pasted board, corner board, paper cups bulk bins, multiwall bags relative to 2007 (base year). UNIT ANNUAL TOTALS Group Outputs1 tonne 58,401 107,519 Raw Materials Packaging Australia Fibre – paper, paperboard tonne 64,579 124,325 40 Recovered fibre (% of input fibre) % 59% 47% Total energy consumption

Other inputs (approximate) tonne 4,134 9,220 30 1 2 3 Scope 1 and 2 emissions (CO2-e) Other significant inputs include: Starch, Adhesives, Coatings, Inks Starch, Adhesives, Plastic film, Inks CHIEFEnergy Consumption EXECUTIVE’S 2014 PURPOSE 20 Water take Direct sources MESSAGE HIGHLIGHTS OUR BUSINESS & APPROACH 10 Waste to landfill (estimated) Fossil fuels2: natural gas, fuel oil, coal, diesel,P1 petrol, LPG GJ P2 75,356 P3103,872 Indirect sources (purchased) 2007 BASE 0 Recovered fibre in feedstock Electricity GJ 26,177 45,384 –10 Total energy consumption GJ 101,533 149,256

Total energy consumption per tonne output GJ/t 1.74 1.39 –20 % Change Water Take Municipal supply m3 20,194 59,240 –30 2008 2009 2010 2011 2012 2013 2014 Surface water m3 0 0 Ground water m3 0 0 4Total water take 5 m3 620,194 59,240 Packaging New Zealand Emissions to Air Scope 1 (direct) emissions (CO -e) tonne 3,916 6,766 PRODUCTS 2 PLANET PROCESS 30 Total energy consumption

UNLOCKINGScope 2 (indirect) THE emissions VALUE (CO2-e) RESPONSIBLEtonne SOURCING STRIVING7,057 FOR OPERATIONAL 1,635 20 Scope 1 and 2 emissions (CO2-e) OFTotal FIBRE Scope 1 and 2 emissions (CO2-e) OF FIBRE tonne EXCELLENCE10,973 8,401 10 Scope 1 and 2 emissions (CO -e) per tonne of outputP8 t/t P13 0.19 P19 0.08 2 2007 BASE 0 Water take Waste –10 To landfill (approximate) tonne 218 581 –20 Waste to landfill (estimated) To recycle tonne 7,389 17,405 –30 Recovered fibre in feedstock To compost/vermicompost tonne N/A N/A –40

Hazardous waste and Prescribed Waste (EPA, Victoria) % Change tonne 10 0 –50 (removal by licensed contractors) –60

A zero (0) in the table signifies that such inputs, discharges, –70 emissions or wastes do not occur (or may occur only below detection limits). ‘N/A’ signifies that the parameter is considered not relevant –80 8 2008 2009 2010 2011 2012 2013 2014 7for that site. 1 Outputs are listed net of internal transfers within the respective group. PARTNERSHIP2 Direct sources from on-site stationary and mobile (vehicular) PERFORMANCE combustion of fossil fuels. COLLABORATION WITH DATA & TRENDS OUR STAKEHOLDERS FROM 2014 P26 P33

About this Report Scope Reporting Standards

Selected key indicators (indexed to output) for 2014 relative to 2007 (base year).

Packaging Australia

40 Total energy consumption

30 1 2 3 Scope 1 and 2 emissions (CO2-e) CHIEF EXECUTIVE’S 2014 PURPOSE 20 Water take

MESSAGE HIGHLIGHTS OUR BUSINESS & APPROACH 10 Waste to landfill (estimated) P1 P2 P3 2007 BASE 0 Recovered fibre in feedstock

–10

–20 % Change

–30 2008 2009 2010 2011 2012 2013 2014 4 5 6 Packaging New Zealand

% Change –50 –60

–70 –80 7 8 2008 2009 2010 2011 2012 2013 2014 PARTNERSHIP PERFORMANCE COLLABORATION WITH DATA & TRENDS OUR STAKEHOLDERS FROM 2014 P26 P33

About this Report Scope Reporting Standards

Disclaimer Environmental This report has been compiled Sustainability Report by Carter Holt Harvey Pulp & Paper Limited (‘CHH PP’) from for the 2014 calendar year › make no representation or internal records and publicly warranty, nor provide any available information for general undertaking, expressed or information purposes and not as implied, as to the timeliness, specifi c advice to any particular accuracy, adequacy, › are under no duty of recipient or person. reliability, reasonableness disclosure or fi duciary Contact Due care has been exercised in or completeness of the duty or any obligation to compiling the report and CHH information or any opinion update any information For more information PP believes the information or statement contained in contained in this report or or feedback: contained herein to be correct this report any other written or oral but has not subjected it to [email protected] › shall have no liability communication transmitted independent review or audit. (including for negligence) for or made available to a Carter Holt Harvey To the maximum extent any statements, opinions, recipient, or to notify any Pulp & Paper Limited permitted by law, CHH PP, information or matters person should any such Private Bag 92004 its related companies and (express or implied) arising information cease to be Victoria Street West affi liates and/or any of their out of, contained in or derived correct after it is provided Auckland 1142 respective directors, offi cers, from (directly or indirectly), and each recipient, by New Zealand employees, agents, offi cials, nor for any errors or omissions accepting delivery of this www.chhpulpandpaper.com advisors or representatives, as from, or failure to correct, any report, waives all rights in www.chhpackaging.com the case may be: information in this report such regard.