SUSTAINABILITY REPORT 2008 grupo orsa REPORT SUSTAINABILITY 2008 SUSTAINABILITY REPORT 2008 MAJOR INDICATORS 4 OPENING MESSAGE 6 ABOUT THIS REPORT 8

1 THE GRUPO ORSA 10 Company profile, operating market 12 Principle 12 Corporate philosophy 13 Vision of future 13 Companies 15

2 STRUCTURE AND OPERATION 26 Corporate governance 28

3 PERFORMANCE INDICATORS 34 Economic performance 36 People management performance 38 Environmental performance 51 Social performance 63

4 APPENDICES 70 Summary of GRI contents 72 Profit People Planet Corporate information 76 Acknowledgements 76 TABLE TABLE OF CONTENTS PHYSICAL DATA NET SHIPMENT ADMT SHIPMENT SHIPMENT TONS OF BOXES + BOARDS M³ OF BLEACHED Pulp M³ OF SAWN TIMBER 2007 2008 + 4.4 % + 7.8 % + 38.5 % Net shipment (t) of boxes + boards Orsa 217,992 227,597 4.4% ADMT shipment (m³) of bleached pulp Jari 356,928 384,628 7.8% Shipment (m³) of sawn timbers Orsa Florestal 13,040 18,057 38.5% 2008 REPORT SUSTAINABILITY 18,057 227,597 217,992 384,628 356,928 13,040 orsa jari orsa f lorestal 2007 2008 2007 2008 2007 2008

ORSA GRUPO RESULTS (R$ MILLION) FINANCIAL AND ACCOUNTING DATA

GROSS SALES GROSS SALES GROSS SALES Gross Sales 2007 2008 Total Assets 2007 2008

MAJOR INDICATORS Orsa 823,712 948,974 15.2% Orsa 1,140,183 1,178,224 3.3% + 15.2 % + 21.6 % + 32.3 % Jarí 471,693 573,521 21.6% Jari 1,395,358 1,387,587 -0.6% Orsa Florestal 20,648 27,309 32.3% Orsa Florestal 14,736 39,820 170.2%

EBITDA 2007 2008 Financial Indebtedness 2007 2008 948,974 27,309 573,521 823,712 20,648 471,693 Orsa 85,593 121,668 42.1% Orsa 171,741 312,877 82.2% orsa jari orsa f lorestal 2007 2008 2007 2008 2007 2008 Jarí 111,236 91,840 -17.4% Jarí 335,136 525,236 56.7%  Orsa Florestal (497) 1,015 Orsa Florestal 2,735 8,921 226.2% 

ebitda ebitda ebitda * THESE AMOUNTS CORRESPOND TO THE EFFECTIVE DEBTS % Operating Margin 2007 2008 + 42.1 % - 17.4 % Orsa 4.6% 9.5%

1,015 Jarí 2.6% -8.1% Orsa Florestal -3.1% 2.3% 111,236 121,668 91,840 85,593 (497) orsa jari orsa f lorestal 2007 2008 2007 2008 2007 2008

Sérgio Amoroso Acquisition of the Acquisition of one Acquisition of a box, board starts the enterprise first Orsa Celulose, pulp and kraft paper and recycled paper factory in Vila Zelina, suburb Papel e Embalagens facility in in Paulínia (SP), one of the largest 1981 1992 1986 of São Paulo city plant in Suzano (SP) 1990 Nova Campina (SP) mill specialized in recycling in Latin America The challenge to keep on growing which closed 2008 with good results and the production of pine pulp and kraft turned into the search for sustainability in a sustainable way enabled a good planning for 2009. paper, ensuring a very expressive growth by means of generation of income, just Since its foundation, the Grupo Orsa has for the Group in the future. Another victory as in the development programs – one of adopted sustainability as its business Internal consumption was the enlargement of the space in the the business strategies of the Group. The strategy, once it believes that sustainable This way, the forecasts of the areas where packaging area, which enabled the Group intention is to build a joint solution with development is the result of the balance the companies of Grupo Orsa operate for future growth. the families benefited to improve quality 2008 REPORT SUSTAINABILITY between profit, people and the planet. remain positive. The expectation is that the One of the great highlights of Grupo of life of the process participants. With the Because of that, even at uncertainty sector benefits with a probable increase Orsa is the production of sawn timbers by development, it is also possible to preserve

ORSA GRUPO times in the world economy, as those in internal consumption, in detriment of means of certified management of native the environment and consolidate the occurred in the end of 2008 and foreseen exports, which should decrease. In the forest, which enables the responsible and small producers production, by creating a

OPENING MESSAGE to 2009, the Group remains steadily wooden sector, the external market should conscious consumption of resources in continuous and sustainable income system. supported by actions that reinforce recede a little, but the domestic market the environment - a product that starts to Ensuring business growth, improving the sustainability. That is the way we choose should absorb part of the production, attract the internal market, allowing the areas in which we operate in social aspects to go all over back in 1981 and that we especially the certified wooden products. company to enlarge its portfolio and not to and applying the sustainability principles will always keep on following. In the pulp sector, 2009 may be a more be a hostage of oscillations in currencies – that is the way we expect to face the crisis The turbulence that reached the market difficult year because of the retraction and foreign markets. Attentive to this in a sound way and help Brazil to become a in 2008 did not leave us unhurt. However, of the international market. Jari Celulose new generation of consumers, in 2009 better country. We know there is a long way  thanks to a prompt adaptation, the results should not have problems of sales volume, the Group is going to invest even more in to be run and with countless challenges to  of the companies that form the Group however it is expected that the prices certifications. The units of Orsa Celulose, be faced, but we have are sure this is the remained positive. With an integrated undergo a backlash. Papel e Embalagens located in Franco right way to follow. team and always attentive to the economy da Rocha, Paulínia and Suzano are being movements in Brazil and in the world, Achievements and certification prepared to receive the Forest Stewardship Sergio Amoroso we try to act in advance to guarantee In 2008, an achievement was the Council – FSC stamp as well. Shareholder and president of Grupo Orsa the financial health of the Group, increment in the potential of the pulp area, besides taking measures – some not so thanks to the investment in planting and Improved business strategy Jorge Henriques pleasant. The decisions appeared to be an development programs. Thus, within six or After 14 years, Fundação Orsa redirected its Shareholder and president of Orsa Celulose, important trick to invigorate the Group, seven years, we will be able to duplicate performance portfolio. In 2008, the focus Papel e Embalagens

Year of creation of Acquisition of forest reserve, Inauguration of The Group takes shareholding control over Jari Fundação Orsa, in charge comprised by 35 thousand ha of a brand-new unit Celulose and the management of Jari project. of the social programs pinus located in the southeast of Orsa Celulose, In a couple of years, the company turns such a 1995 1999 1994

developed by the Group area of São Paulo. It is the Papel e Embalagens 2000 bankrupt experience into a worldwide reference beginning of Grupo Orsa’s in Manaus for sustainable development forest development program eople, the planet and profit - these are the three pillars that P govern the actions of Grupo Orsa. The Group believes that the development both of the company and the society is only possible with the performance constantly 2008 REPORT SUSTAINABILITY attentive to sustainability in all dimensions - social, environmental and economic – and

ORSA GRUPO with the transparent disclosure of data and facts. To publicly disclose such actions developed by the company in 2008, we have

ABOUT THIS REPORT opted for a report model that aggregated greater highlight to the information regarding the environmental and social areas and the financial data. This is the second year the Group is using The information contained herein company PricewaterhouseCoopers, just the G3 guidelines of the Global Reporting refers to the period comprised by January as the report performed in 2007, to  Initiative (GRI) as model for report, which 2008 to December 2008. Grupo Orsa assure consistency and accuracy in the  is based on sustainability principles. In reports are produced annually. In 2008, data published, which is available in the 2008, with the purpose of increasing the data included in this document was website www.grupoorsa.com.br. transparency of its actions, the company gathered in all companies of Grupo With the purpose of improving the tried to aggregate more information Orsa, including the new business unit next report and increase the involvement to the document, however, with the of Franco da Rocha, which was not of different people that are connected understanding that the disclosure of results present in the report of 2007. The with the organization, the readers and its operations is a constant process of information regarding the present are invited to place their comments, evolution. The indicators of GRI G3 permeate financial statements in this report was criticisms and suggestions by the e-mail the report and are listed in the index. submitted to appraisal of the consultancy [email protected].

converting facility to the unit of Creation of Orsa Florestal, Inauguration of the plant in the packaging and boards plant company in charge of the Franco da Rocha, the most eco of Rio Verde, one of the most forest management program efficient facility of the Group 2001 2003 modern plants of the sector in the region of Vale do Jari 2008 2008 REPORT SUSTAINABILITY The Grupo Orsa ORSA GRUPO

10 11 Profile of the company, of sustainability, which surpasses the above all, quality, efficiency, ethics and operating market commitment to the businesses and the transparency as corporate governance With 28 years of performance in the sector communities where they are inserted. pillars, besides investing in the of wood, pulp, paper and packaging, The Group aims the improvement of life improvement of quality of people’s lives, Grupo Orsa is an organization constituted in the country, through the corporate so they have a fundamental role in a by 100% of national capital stock. Its actions, considering its effect in the whole sustainable society structure. 2008 REPORT SUSTAINABILITY four companies – Orsa Celulose, Papel e economical, social and environmental It destines 1% of its income to social Embalagens; Fundação Orsa; Jari Celulose chain, together with its participants. and environmental projects by means

ORSA GRUPO and Orsa Florestal – operate in an integrated Grupo Orsa promotes economical of Fundação Orsa, as a commitment to way, always with their actions ruled by the development maintaining the respect to compliance with its philosophy. sustainability principles. The Grupo Orsa has the global ecological limitations, so as a vertical performance, in other words, it the future generations get the chance Future View develops activities in every productive chain, of existing according to their needs, in a Establishing a sustainable society, which from the cultivation of eucalyptus and pinus, balanced world. promotes everyone’s well being without the certified management of native compromising future generations, seeking forest and wooden products, until the Company’s philosophy balance in the relationship between production of pulp, paper and corrugated The Group searches for economical growth people, environment and businesses, 12 cardboard packaging. jointly with the generation of wealth to never disregarding local and specific 13 Having the sustainability concept as Principles the society, acting in a fair and balanced characteristics of each community. the axis of business strategy and social To Grupo Orsa, the business development way in all its relationships: commercial, A company with an eye in the future, transformation factor, the Grupo Orsa is must be a factor capable of transforming the industrial, social and environmental. which aims multiplying partnerships grounded on the tripod of the 3Ps – people, society, through economically viable, socially The company aims to be a “bigger seed” with the many society agents, according profit and planet – dynamic widely spread and fair and environmentally correct actions. of transformation, supporting social to participative management principles well-known in the whole world to develop its More than sustainable development, environmental activities, which may be that support a social model to guarantee actions, besides using technologies that assure Grupo Orsa practices the concept used as public or private policies. the human being basic principles: quality and competitiveness in harmony with of sustainable society as a business The Group adopts a corporate employment, social security and respect the environment and the society. strategy axis. That is a wider vision philosophy that looks for providing, to cultural diversity. COMPANIES

1) Orsa Celulose, Papel e Embalagens Orsa Celulose, Papel e Embalagens has been operating for 28 years in the Brazilian 2008 REPORT SUSTAINABILITY 6 market, where it works in a vertically integrated way, acting in all business

ORSA GRUPO stages, from the planting of the wood until the production of pulp, paper and packaging. Considered one of the largest integrated companies of the sector, Orsa Celulose, Papel e Embalagens accounts six plants located in the North, Central- West and Southeast Brazilian regions, which allows a fast response to demands Papel e Embalagens is the development of incoming from the whole country. solutions for special packaging, according 14 With the purpose of making the to the requirements of the different sectors 15

orsa florestal 7 production and delivery processes more of domestic and international industries. jari celulose 8 efficient and agile, the company started orsa celulose, papel e embagens: the deployment of the Orsa System of a. franco da rocha Fundação Orsa b. manaus 1. Glicério 5. VAle do jari Production, based on Lean philosophy, in the Employees 2,651 c. nova campina 2. ITAPEVA 6. Manaus facility of Paulínia. That system, which in few Contractor 617 3. RIO verde 7. Campinas d. paulínia months has already reached positive results, Fluting paper production capacity 16,500 t/month e. rio verde 4. Suzano 8. Barueri/Alphaville Kraftliner production capacity 16thousand t/month f. suzano – head office is intended to be installed in the coming Corporate office Alphaville – Barueri Fundação Orsa – national-based operations years in the other companies of the Group. Packaging production capacity 36thousand t/moth Another differential of Orsa Celulose, Gross revenue R$ 948.9 million Suzano Unit (SP) agreement with the strict international packaging facilities of Orsa Celulose, As the first factory inaugurated by Orsa standards of quality and environment. Papel e Embalagens. It also operates Celulose, Papel e Embalagens in 1986, this in sales for customers in domestic e unit is one of largest and most modern international markets. units producing corrugated cardboard Employees 754 cases and boards in Latin America. Contractor 107 2008 REPORT SUSTAINABILITY Certified according to ISO 2001 and ISO Packaging and board Employees 427 14001 standards, the unit operates in production capacity 162 thousand t/year Contractor 192

ORSA GRUPO Kraftliner and white top paper production capacity 180 thousand t/year

Paulínia Unit (SP) Merged in 1992 to Orsa Celulose, Papel e Embalagens, the unit is responsible for the production of recycled paper, corrugated cardboard boxes and boards. 16 Considered one of the largest units 17 specialized in recycling in Latin America, the unit relies on ISO 9000 and ISO 14000 Certifications.

Nova Campina Unit (SP) Employees 668 Acquired in 1990, the plant is responsible Contractor 106 for the production of kraftliner and Recycled paper production capacity 138 thousand t/year white top liner paper that supplies the Packaging production capacity 72 thousand t/year Manaus Unit (AM) It is the most eco efficient unit of Inaugurated in 1999, Manaus facility produces the Group, with several environmental corrugated board cases and boards to supply the advantages, among which a closed circuit market in the north region of Brazil, specially the of water. It is prepared to receive the ISO industrial park of Manaus, one of the largest in 9000 and 14000 Certification, besides the Brazil comprising more than 500 industries. Forest Stewardship Council – FSC stamp. 2008 REPORT SUSTAINABILITY

Employees 119

ORSA GRUPO Employees 198 Contractor 18 Contractor 23 Recycled paper production Packaging production capacity 162 thousand t/year capacity to be used in packaging 48 thousand t/year Rio Verde Unit (GO) Installed in 2001, it is considered one of Marquesa Unit the most modern factories of the sector Reforestation company responsible for all in the country. pinus chain since planting. It provides raw First large-scale manufacturer of packaging material for the industrial process of New 18 and boards in the central region of Brazil, Campina and sells wood to the market as 19 in Rio Verde, Goiás, it has contributed with Franco da Rocha Unit (SP) well. In addition to its own forest basis, the development of the region, enabling In operation since July 2008, the the company’s policy is encouraging the distinguished assistance to the customers of workshop is the newest investment of production of forests by small-sized and this important Brazilian industrial park. Grupo Orsa. With installed production medium-sized producers by means of the capacity of 4 thousand tons per month Forest Development (Fomentation). of high-performance recycled paper, it Employees 338 is responsible for the increment of 15% Employees 1,025 Contractor 94 in the paper production capacity of Orsa Packaging production capacity 120 thousand t/year Celulose, Papel e Embalagens. Contractor 815 2) Jari Celulose In 2008, the world producers sold and velvety touch to sanitary papers, as Located in Munguba District, in Almeirim approximately 12 million tons of bleached the refining of the pulp ensures other (PA), the company is installed in an eucalyptus pulp. Jari accounted for 3% of that advantages, such as better printing quality area covering 1.3 million hectares in the volume, with total sales of 385 thousand tons, and easy porosity control and paper opacity. Amazon Rainforest that produces bleached representing an increment of 8% compared eucalyptus kraft pulp (BEKP). It is the to the previous year. From the total sales, Logistics 2008 REPORT SUSTAINABILITY only factory of pulp in the world with the 95% was directed to the external market and Jari relies on steady performance in certification 100% FSC for the whole chain of 5% to the domestic market. the major specialized pulp terminals,

ORSA GRUPO custody and one out of few companies with Considering all the pulp commercialized by which ensures supply of customers with total plated area with ISO 14001 certification. Jari in 2008, 39% was used to the production efficiency and quality. The company has a The FSC certification embraces forest of tissue papers, 31% to special papers, such distribution point in the Chinese market management (FSC-FM) and chain of custody cigarettes and labels, 17% to printing & writing and four European points: Holland, France, (FSC-COC) for 100% of Jari’s production. papers and 13% to cardboards. Italy and Spain. In 2008, Jari exceeded itself in several sectors, as in the production of 390 thousand tons, breaking the annual, monthly and daily records of the plant, 20 and in the largest history planting, with 21 12 thousand hectares of eucalyptus and conduction of 3 thousand hectares of Product sprouted eucalyptus. The eucalyptus pulp produced by Jari Celulose is made from plantations in the equatorial region of the country, which Employees 824 provides peculiar characteristics when Contractor 1,829 compared to the competitors. The high Pulp production capacity 410 thousand t/year number of fibers per gram provides softness Gross revenue R$ 573.5 million 3) Orsa Florestal by using 18 commercial native species. of work positions and income, having With six years of operations in the Its products supply the Brazilian, North projects in the health, education, market, Orsa Florestal It is located at Vale American, European and Asian markets. culture, art, environment, sports and do Jari (PA) and is responsible for the With differentials such as a private harbor, rights assurance areas as support. The management of 545 thousand hectares which outflows its production, Orsa Foundation seeks disseminating models in the Amazon region, where low impact Florestal reached in 2008 a record in its of social technologies that can be 2008 REPORT SUSTAINABILITY techniques are used, therefore allowing the history: the harvest of 140 thousand cubic multiplied by means of the invigoration conciliation of the utilization of the forest meters of wood. of public policies.

ORSA GRUPO with its preservation, making the company Also in 2008, the company intensified its The projects are accomplished jointly a reference in the whole world due to its sales to domestic market and diversified its with universities, government agencies, sustainable management. products, including in its portfolio decks and NGOs, trade and company associations, It produces 100% FSC-sawn woods rail sleepers, besides green sawn timbers. aiming at creating a net of partnerships and enlarging its performance to the national scope. Employees 374 Contractor 21 Production capacity 24,000 m3 22 Gross revenue R$ 27,309 million 23

4) Fundação Orsa Fundação Orsa works in partnership with the other companies of the Group, developing programs and projects in the communities located next to the industrial units. In 2008, it addressed its performance to local integrated development, based on the generation AWARDS AND ACKNOWLEDGEMENTS Corrugated Cardboard Direct Print Brasileira de Multimídia, in the Finalist of the Planeta Casa 2008 Prize, on the Board – Cross Linked, for the category Best Environment Work in in the category Social Action case Programa Vértice 2008 Unilever packing Tryon Shoe Box. Local Scope – case Vale do Jari. Sustainable Art in Amazon –, awarded by certification as quality certified supplier Casa Cláudia magazine and Abril Press. to Paulínia and Suzano units of Orsa 3rd place in Flexo Quality Prize, awarded th edition of Mogi News Chevrolet Celulose, Papel e Embalagens, awarded in by the Brazilian Technical Association of Award of Corporate Social Entrepreneur of the Year Prize, awarded 2008 REPORT SUSTAINABILITY acknowledgement of the administration Flexography (ABFLEXO), in the category Responsibility of Alto Tietê region, to the president of Grupo Orsa, Sergio and continuous improvement of delivery Corrugated Cardboard Direct Print on in the category Relation with Amoroso, by the 4th edition of “Prêmio

ORSA GRUPO performance indicators. the Board – Line, for the packing of the Community. Madeira”. Amoroso was considered Pampers Diapers. the major contributor in 2008 to Packing and Trademark Prize 2008 for Bassan Harati Trophy in Corporate the organization, the visibility and the “Bag in Box” case, package for Vila Preference spotlight in 2008 in the Quality, awarded by the Commercial penetration of the paper segment in the Velha oil, in partnership with Dupont, categories Corrugated Cardboard and Corporate Association of Suzano, in Brazilian society. responsible for manufacturing the Packaging and Corner Protections by the category Tertiary Sector. plastic container. Pack magazine readers, considered Considered one of the top ten one of the most important and V Spanish-American Prize “en Honor a corporations with best indicators of EMBANEWS Prize Spotlight of the Year distinguished publications of the la Excelencia Educativa 2008”, awarded Organizational Human Development 24 with the package for Pampers Project packaging sector in Brazil. conceded by Consejo Iberoamericano out of a thousand major companies in 25 “Joaninha (Ladybug)”, in the personal en Honor a la Calidad Educativa. Brazil. The research was accomplished hygiene-packaging segment. Acknowledgement of the partnership by Gestão e RH Press according to the 2008 awarded by BSH Continental Honorable mention of the Von criteria of Exame magazine. The highlight EMBANEWS Prize in the category Eletrodomésticos Ltda., one of the most Martius Sustainability Prize, in the of Grupo Orsa was for the category Technology for the packing Display important manufacturers of appliances category Humanity, for the Project Corporate Citizenship and Sustainability. Koleston, elaborated for Procter & Gamble. in the country. Performance of Orsa Foundation at Vale do Jari. The prize is granted by 2nd place in Flexo Quality Prize, 3rd Brazil Environment Prize from Jornal the Commerce and Industry Chamber awarded by ABFLEXO, in the category do Brasil, awarded by Companhia Brazil-Germany. 2008 REPORT SUSTAINABILITY ORSA GRUPO

26 Structure 27 and operation Corporate Governance president of the Group, Sergio Antonio Management transparency is To protect the assets and maximize Grupo Orsa adopts the corporate Garcia Amoroso, by the shareholder increasingly an element that attracts return on investments; governance principle to ensure Jorge Henriques and two independent capital, reinforces relationships with transparency in decision- making members, is in charge making decisions employees, customers, suppliers, the To select and assess the main company processes. The Management Council and planning of actions for the government and the society as a whole, by officers (presidents and directors); of the Group is in charge of strategic companies that make up the Group. The adding value to the organization. 2008 REPORT SUSTAINABILITY decision- making, therefore it ensures implementation of all issues is checked The chart shows how corporate To ensure the companies ethical and transparency in the management and for compliance with the mission and governance is practiced within Grupo legal behavior;

ORSA GRUPO commitment to the best corporate values of the Group, and the Council must Orsa. It is expected that the officers governance practices. The Council also ask for feedback concerning results constantly start actions towards ensuring To monitor the good standing of the that in 2008 was composed of the from officers. good companies performance. However, company regarding technological and initiatives involving important strategic human resources; movements should be approved by the shareholders. The officers care for the To work as agents of change. OFFICERS SHAREHOLDERS adoption, providing elements to allow shareholders to monitor its progress. Such Additionally to the Management Council, monitoring includes not only technical- Fundação Orsa has an Advisory Committee 28 START DECIDE economic aspects, but also compatibility comprising multiple segments of the society, 29 APPROVE with the Group principles and values. which rigorously follows the Foundation Trustee rules. The Committee deals with the Tertiary Management council responsibilities Sector standards, with approval of budgets and projects related to strategic issues. To care for the company principles and IMPLEMENT CONTROL values maintenance; OPERATE MONITOR To be involved in defining and approving companies’ decisions and strategic actions; sergio amoroso Council President Management Council Composition Member of WWF – Brazil; counselor Organization chart at Fund Itaú Social Excellence (FIES);

Sergio Antonio Garcia Amoroso Governance Advisor of Group of Institutes, jorge President of Grupo Orsa. He is the Foundations and Enterprises (GIFE), henriques founder, main shareholder, controller and member of the Advisory Board of the Fund President president of Grupo Orsa’s Management Ecomudança Itaú; member of the board 2008 REPORT SUSTAINABILITY Council. He created Fundação Orsa in of the Institute Ronald Mcdonald (IRM), 1994 and became major shareholder a founding partner of Commitment “All joão dino ricardo

ORSA GRUPO and president of Jari Celulose in 2000. for Education”, counselor of the Board of eduardo ranzani galan He is also president of the Group for the Social Responsibility CONSOCIAL – FIESP/IR; daniel peres lari Pulp and Packaging Support of Cancer-Afflicted Teenagers counselor at Sidarta Institute, counselor of de chiaro Controllership papaleo Paper Industrial Director Director Director and Children – GRAAC; Founder the Center for Social Entrepreneurship and Holding Information management of the Third Sector – CEATS, Planning Technology Manager Manager advisor of Telefonica Foundation. patrick joão marliete nogueira prestes Shareholder: Jorge Henriques martins Commercial Forest Director Business He is a shareholder of Grupo Orsa, civil teresinha valdir Legal Director 30 and industrial Engineer who worked for mauro maioli Manager 31 Rodhia S/A in the Group’s investment Fundação Accounting Orsa Manager Manager technical consulting Area. He joined sandra carla Grupo Orsa 16 years ago, first in Paulínia lima pontes denilson and Nova Campina units in the areas of Finance International ferreira strategy planning for new markets and Manager Logistics Forest Business Manager production sector control and planning. Manager He is also a counselor at Fundação Orsa and member of Grupo Orsa’s luiz bezerra Management Council. Human Resources josé mário Key and Infrastructure rossi President Manager Environment and Director Quality Manager

Manager luiz cláudio ribeiro Supplies Manager Ethics and respect to institutions and the environment All companies and employees that compose Grupo Orsa are compelled to comply with international and domestic laws, always acting according to strict 2008 REPORT SUSTAINABILITY principles of respect for race, religion and minority groups, besides seeking to

ORSA GRUPO decrease environmental impacts. The Corporate Communication Management is responsible for ensuring transparency of actions and factors that are relevant for the Group, by communicating

to all stakeholders its principles, values and value-adding activities in both economic and 32 social fields. Hence, integrated and proactive 33 involvement of the whole top management structure of the Group organizations is vital.

External and internal audits Grupo Orsa counts on an internal audit area linked to the Management Council. All companies of the Group are externally audited by the consultancy agency PricewaterhouseCooper. 2008 REPORT SUSTAINABILITY

ORSA GRUPO Performance indicators

34 35 ECONOMIC PERFORMANCE a number of investments in the industrial machine started operations in October and In 2008, the world scenery, which had been park. The major benefit was the production increased the site production capacity to in a constant pace of expansion, was suddenly stabilization in the plants. 6 thousand tons of boards, enabling the changed by the economic crisis that started In the packaging area, the most conversion of all boards produced by the to show its face in the second semester. expressive investment occurred at Paulínia factory into packaging. At Rio Verde mill, The turbulence in the international unit: the deployment of the fourth shift, the installation of a four-color printer die 2008 REPORT SUSTAINABILITY market partially affected the environment allowing the unit to work with 100% of its cutter and folder provided for an increment until then positive of the paper, pulp, capacity, and the installation of a four- of 20% in the production of containers.

ORSA GRUPO wood and packaging industry, directly color printer die cutter and folder. The In the paper area, the highlight was the reaching Grupo Orsa. installation of Franco of the Rocha plant, However, thanks to an emergency with production capacity of 4 thousand readjustment – which included reduction tons of high-performance recycled of payroll expenses, slowdown in the paper per month, whose investment was production of some facilities and the approximately 40 million reais. suspension of plans – the corporation e Embalagens, the operational generation In the wood area, Orsa Florestal reached excellent results. reached R$ 121.6 million, with an increment of installed two new production lines: one in In the same year, Grupo Orsa recorded 42.1%. As for Orsa Florestal, it had an EBITDA January and another in October 2008. The 36 gross revenue of R$ 1.5 billion, an increase of of R$ 1 million. investment increased the capacity installed 37 17.8% when compared to the previous year. Further information may be obtained on of production by 150%, which helped the One of the companies we particularly page 4, which brings the main indicators company to beat records of production and highlight is Orsa Florestal, which had of the Group, or in the virtual address sales volumes, making the year 2008 the revenues amounting to R$ 27.3 million, http://www.grupoorsa.com.br/resultados/ best year ever for Orsa Florestal. increase of 32.3% in comparison to 2007. dem_financeiras.html. With perspective of accomplishment The operational cash generation (EBITDA) in medium term, Orsa Florestal started in 2008 at Jari reached R$ 91.8 million, Investments and perspectives negotiations with the Government of the recording a decrease of 17.4% when compared In search of evolution in its productive State of Amapá for the installation of a to the previous year. At Orsa Celulose, Papel processes, in 2008 Grupo Orsa carried out new forest management project similar Profile Employees by gender and position By the end of 2008, the Group had 5,699 Women 9.7% direct employees and 3,307 indirect Men 90.3% employees, totalizing 9,006 employees, a decrease of 5.3% in comparison to the People with disabilities previous year. During the same period, 124 people with 2008 REPORT SUSTAINABILITY disabilities worked in the companies that Unit/region Employees Contractor compose Grupo Orsa, an increase of 11% in

ORSA GRUPO Orsa Florestal 438 21 the number of employees at such conditions Nova Campina 444 192 when compared to the previous year. Suzano 794 107

Paulínia 695 106 Employees with disabilities Rio Verde 409 94 Alphaville 3 Manaus 210 23 Fundação Orsa 1 Franco da Rocha 121 18 Manaus 4 Corporate 136 81 Marquesa 10 to that currently held by the company in People management Jari 943 1,826 Nova Campina 22 38 Pará. The project sets forth the current performance Marquesa 1,354 815 Paulínia 29 39 management area comprised by 545 Responsibility before the employee is Fundação Orsa 155 24 Rio Verde 18 thousand hectares in Pará is expanded in considered vital for the success of the Total 5,699 3,307 Suzano 35 300 thousand hectares in Amapá. In short business; therefore, it is one of the priorities Franco da Rocha 2 term, the company foresees increasing the of Grupo Orsa. Besides caring for the Gender Total 124 current capacity of the sawmill, besides the welfare, health and safety of employees, By the end of 2008, the Group counted investment in operational improvements the people management policy main focus on 553 women in its payroll, and 5,146 in the three production lines of the factory, is the development of the professionals men, equivalent to 90.3% from the total, in order to make production even more potential by means of courses, lectures and direct reflex of the activity developed by efficient and safe to the employee. training in several areas. its companies. Age range Length of service With a staff essentially young, Grupo Orsa has With an internal policy that valorizes the 2,742 workers ranging from 19 and 30 years employee, the companies accounted for old, or 48.11% from the total of employees, 1,005 people with more than ten years in plus 26.56% from 31 to 40 years. the Group in 2008, the equivalent to 17.6% from the total of employees. Reflex of the 2008 REPORT SUSTAINABILITY Total employees by age range recent growth of the Group, the number Age Total % of employees with less than one year

ORSA GRUPO Up to 50 years old 39 0.68 represented 13.3%. 41 to 50 years old 1,049 18.4

31 to 40 years old 1,457 25.57 Total employees by length of service 25 to 30 years old 1,730 30.36 Years Total 19 to 24 years old 1,012 17.76 Less than 1 758 as specialization, Master’s degree or Ph.D. Remuneration and benefits 16 to 18 years old 412 7.23 1 1,643 At remote units, there are still a number Ensuring remuneration and benefits in line Total 5,699 100 2 to 5 1,605 of Contractor with low levels of education: with the market practices is a constant 6 to 10 688 5% have only finished elementary school concern of Grupo Orsa to attract and 11 to 20 765 and 4% are illiterate. keep employees motivated and increase 40 21 to 30 209 the company competitiveness. For that, 41 Over 30 31 Employees by education level in 2008, directed R$ 106.5 million to the Total 5,699 Illiterate 4% payment of salaries and, at the same Incomplete elementary school 18.4% period, approximately R$ 11.5 million Education Complete elementary school 5% allocated to profit sharing programs. Among the employees, those professionals Incomplete high school 7% Besides the remuneration, the companies that had already finished high school Complete high school 32% of the Group granted approximately R$ prevail, composing 32% of workers of the Complete technical education 13% 57.4 million in packages of benefits that Group. The graduated ones are 16%, and Complete graduation 16% contribute for life quality of employees 1% have some postgraduation course, such Complete postgraduation 5% and their families. of employees of the Group by means of 2008 and intended to finish in 2009, 18 coaching, process that leads managers employees are being benefited. to adopt efficient procedures in their The specialization in corrugated roles and career planning and customized cardboard provided at Suzano and Paulínia development plans. sites, the first group, initiated in 2008, has The result is the utilization of internal 24 students. With duration of 18 months and 2008 REPORT SUSTAINABILITY talents and the cohesive performance in 1,200 hours, the specialization is facilitated line with the organizational values and by the employees to their colleagues, which

ORSA GRUPO objectives. From April 2007 to April 2008, learn basic subjects, such as math and 214 professionals passed by the program. Portuguese, and techniques that involve all Nowadays, 23 employees take part the production process stages and delivery of the process, among them the Lean of products to the customer. coordinator at Paulínia workshop, As for the technical training course in Rogério Domingues. “I started asking mechanical maintenance, the students myself about details that were previously learn to work on the repair of industrial deemed ordinary, and at each session I machinery at Jari, where the specialization realize the opportunity the program is is provided. The first group of the course, 42 offering me”, says the employee, which which will have 1,660 hours and is scheduled 43 states feeling the improvement in his to finish in 2009, counts on 20 students. working process. Development and training the company’s processes, increase Another highlight in 2008 was the During 2008, the companies of the Group the working model efficiency and the continuation of specialization courses in I started asking myself about offered 160,378 hours in courses, training satisfaction of employees and customers. pulp and paper and corrugated cardboard. details that were previously deemed and lectures, which had the attendance of One of the highlights was the Leadership In the unit of Nova Campina, 27 employees ordinary, and at each session I realize employees from all hierarchical levels. With Potential Mapping Program sponsored by had graduated in the first specialization the opportunity the program is a total investment of more than R$ 480 Grupo Orsa. The Program starts in 2007 group in pulp and paper. In the second offering me thousand, these actions aim at improving and aims at developing the competences group of the course, initiated still in Rogério Moura – employee Now I can say I don’t want to stop based on Lean Manufacturing philosophy, here. As soon as I finish the course, I developed by Toyota, whose objective is will enroll in the university to promote a dramatic cultural change, Cristiano Rodrigues - Beneficiary focusing the reduction of the seven wastes: transportation of materials; turnover; waiting time; defects; production 2008 REPORT SUSTAINABILITY Just promoted from production assistant surplus; processing excess; and stocks. I to storekeeper I, Cristiano Rodrigues, 29 Orsa System of Production follows the

ORSA GRUPO years old, attributes to the specialization principle that the resolution of problem the fact of being contemplated with the promotion. Employee at Suzano plant and member of the first group in the corrugated cardboard course, Cristiano tells that, thanks to the opportunity of come back to “school”, he glimpsed a world of knowledge that he had to explore and that was still undeveloped. “Now I can say I 44 don’t want to stop here. As soon as I finish 45 the course, I will enroll in the university.”, he plans. The intention is that, in 2009, this specialization is certified by Senai; therefore, ensuring the confirmation of its excellence degree.

Innovation in customers management In 2008, the Group invested in the deployment of Orsa System of Production, is to be achieved by means of teamwork the customer with deliveries in the amount Besides the commercial issue, valorization, better utilization of and within the schedules requested. The Orsa deals with International Paper resources, costs reduction, productivity system deployment has pleased a number differently, from the provision of and flexibility increase. The result is the of customers, such as International Paper. services until the problems solution. refinement in assistance to customers. “Besides the commercial issue, Orsa What accredits Orsa as a long- The pilot project contemplated a paper deals with International Paper differently, term supplier is that, besides the 2008 REPORT SUSTAINABILITY mill and part of the packaging facility at from the provision of services until the products quality and price issues, it Paulínia unit. Excellent results have been problems solution. What accredits Orsa is preoccupation in bringing solutions

ORSA GRUPO reached, such as the reduction of setup as a long-term supplier is that, besides for the business time, improvement in productivity and the products quality and price issues, it Marcelo de Lima Bueno – International Paper information flow, enhancing services to is preoccupation in bringing solutions for the business”, states the person in charge of the purchase and import department at International Paper, comply with the requirements shown by Marcelo de Lima Bueno. the indicator on a daily basis. The Group foresees for 2009, the With the purpose of improving services expansion of Orsa System of Production to and relations with internal and external 46 the whole unit located in Paulínia, besides customers, the campaign “Cliente a gente 47 the preparation of Suzano, Nova Campina conquista todo dia” was accomplished, and and Franco da Rocha units for deployment counted on the participation of almost all of the Lean as from 2010. The company employees in all units of the Group. noticed, by means of that project, the need The action made, by means of for deploying the On Team In Full – OTIF lectures, each employee feel responsible indicator, which monitors deliveries in for the customer satisfaction, besides the time and amounts requested by the emphasizing the importance of all process customers. That enables focusing efforts stages for producing the final product with on the problems related to the failure in perfection and efficiency. plants that have complained of pain can preventive actions, in 2008, Grupo Orsa get to the emergency room existing at the invested R$ 5.41 million in initiatives units and obtain the treatment prescribed related with safety and labor medicine in by the physiotherapist. all companies of the Group. Moreover, most of the treatment can be made in-house, thanks to 2008 REPORT SUSTAINABILITY the rooms bearing equipment for acupuncture sessions, pilates, Global Labor accidents

ORSA GRUPO Posture Reeducation (GPR) and several 209 physiotherapy techniques. 176 187 The Group also develops projects for 112 improving its industrial parks, with focus on the processes automation, in order to

Organization Environment organizational human development decrease employees’ physical stress. with leave without leave 2007 2008 2007 2008 In 2008, Grupo Orsa developed the Profile indicator. The national research, During 2008, the companies of the Research, with the purpose of tracing the performed by Gestão e RH Press, elected Group registered 385 accidents involving social-economic profile of the companies’ the Group according to the criteria of their employees, which represent an Investment in safety 48 employees. In order to survey information, Exame magazine, after evaluating the increase of 28.7% in the number of and labor medicine 49 researchers interviewed 4,607 employees of largest and best corporations in Brazil. accidents in relation to 2007. At the R$ million all units. The analysis of such data will allow same period, there was the installation 5.61 5.41 creating internal projects focused on the Safety and health of Franco da Rocha unit of Orsa Celulose, real needs of employees and their families, As integral part of the concerns of Grupo Papel e Embalagens, besides two so as to help improve the work environment Orsa in keeping health and safety of production lines of Orsa Florestal. inside the companies even more. its employees, a program that makes a To consolidate and strengthen the This and other actions made Grupo physiotherapy professional available at employee’s understanding regarding 2007 2008 Orsa to be considered in 2008 a top Suzano, Paulínia and Nova Campina units the compulsory rules for utilization ten Brazilian corporation with the best was created. Today, all employees at those of equipment, safety practices and Environmental residues, enabling the Group to keep the performance productive chain sustainable. To ensure the preservation of forests, Introduction the Group has recently achieved the All companies that make up Grupo FSC stamp, awarded by the Forest Orsa are committed to the reduction of Management Council, non-governmental 2008 REPORT SUSTAINABILITY environmental impacts, the preservation of organization that spreads and facilitates the nature and maintenance of efficiency good management of the Brazilian

ORSA GRUPO in operations with minimum rates of forests according to sustainable damages to the environment. Because principles and criteria that conciliate of that, ongoing investments are made environmental preservation, social in the rational use of resources, control welfare and economic feasibility. of atmospheric emissions and hydric Nowadays, Jari Celulose already has effluents, and reduction and recycling of that stamp, being the sole pulp production with 100% FSC certification for all of its chain of custody in the world, and Orsa Florestal, which has been certified from 50 the management until the production of 51 sawn timbers. In 2008, the main achievement was the preparation of Franco da Rocha, Suzano and Paulínia sites to receive the certification along 2009. All Orsa Celulose, Papel e Embalagens and Jari Celulose units are certified with ISO 9001/2000, in quality management. The facilities located in Indicators of consumption volume - paper business Paulínia, Manaus and Suzano, as well as At Rio Verde unit, there was the the forest operation at Jari Celulose are installation of oil separator in the boiler, NOVA CAMPINA PAULÍNIA FRANCO DA ROCHA certified by ISO 14001 standards, which an investment of R$ 35 thousand, besides 2006 2007 2008 2006 2007 2008 2008 define parameters for the structuring of the acquisition of five kits for leaks RAW MATERIAL (T) the environment management system of containment. At Manaus facility, the leaks Pinus wood used in the production of brown pulp 362,287 405,703 463,052 - - - - the companies. prevention was also focus of investments, 2008 REPORT SUSTAINABILITY Intercompany wastepaper 2,401 3,186 1,276 32,848 34,033 37,156 5,962 In 2008, Grupo Orsa allocated with the construction of containment walls Third parties’ wastepaper 52,793 61,555 56,538 120,000 116,023 111,392 19,265 8.18 million to initiatives relating to and supports for storage of residues. ELECTRIC POWER (MWH) 118,591 123,412 125,298 65,080 63,588 61,956 12,324

ORSA GRUPO the environment preservation and At Jari Celulose, refurbishments and Power internally generated 95,363 116,540 121,242 - - - - improvement of environmental quality enlargement in the area used for provisory Power purchased from utilities concessionaires 23,228 6,873 3,874 65,0801 63,588 61,956 12,324 of its operations. The construction of disposal of residues were carried out. In CHEMICALS (T) 20,254 21,868 22,986 818 773 718 195 Franco da Rocha plant was the biggest Paulínia, economizers were installed in the Quicklime 14,238 17,547 19,191 - - - - investment. Besides the installation of a unit boilers, in addition to the optimization Caustic soda 4,321 2,804 2,760 117 76 101 3 water treatment station, dikes and leaks of the storage area of chemical products Starch 1,696 1,517 1,035 701 697 617 192 containment systems in several sectors and residues. ENERGY MATRIX onsite, the factory located in Franco da In the coming years, the goal of the In tons 249,322 239,709 245,915 19,101 17,816 17,884 3,113 Rocha relies on a closed circuit of water, Group is to put in practice the mechanism Woods for biomass 246,039 237,925 243,661 - - - - 52 which makes possible to reuse the whole of clean development of the factories that Bunker c oil 3,283 1,784 2,254 129 108 66 - 53 water used there; therefore, preventing emit greenhouse gases. The project, which Natural gas - - - 18,973 17,708 17,818 3,113 taking water from the environment. is under analysis, should be implemented Gcal 441,824 414,184 428,184 153,618 143,262 143,751 25,007 At Suzano worksite, the main investment as from 2010. Wood for biomass 410,968 397,414 406,996 - - - - was the installation of the forklifts washer. The certifications procurement and the Bunker c oil 30,856 16,771 21,188 1,212 1,014 617 - Suppliers that make the final destination efforts of the Group in keeping its factories Natural gas - - - 152,406 142,248 143,134 25,007 of residues of the plant have undergone technologically updated and compliant Gcal/ton produced 2.90 2.49 2.49 1.11 1.07 1.10 1.10 environmental audits, and punctual works with the sustainability rules are reflexes Wood for biomass 2.70 2.39 2.37 - - - - of maintenance of leaks containment were of the commitment in seeking a social and Bunker c oil 0.20 0.10 0.12 0.01 0.01 - - accomplished in 2008. environmental responsible performance. Natural gas - - - 1.10 1.06 1.10 1.10 Indicators of consumption volume - packaging businesS Indicators of consumption volume Indicators of consumption volume - pulp business - forest business SUSANO PAULÍNIA RIO VERDE MANAUS JARI CELULOSE ORSA FLORESTAL 2006 2007 2008 2006 2007 2008 2006 2007 2008 2006 2007 2008 2006 2007 2008 2006 2007 2008 RAW MATERIAL Production 358,215 355,700 390,346 Production 12,657 12,312 24,290 Intercompany paper 129,761 125,001 133,965 55,342 54,934 59,508 63,567 58,497 65,797 16,440 12,800 15,755 4.20 4.38 4.15 0.23 0.20 0.24

2008 REPORT SUSTAINABILITY Third parties’ paper 2,330 7,216 9,112 1,410 3,103 2,946 9,266 17,298 11,491 8,064 7,030 8,230 BASIC RAW MATERIAL BASIC RAW MATERIAL ELECTRIC POWER (MWH) 10,682 10,706 11,959 5,309 5,253 5,914 7,109 7,277 7,639 2,238 2,196 2,026 Eucaliptus wood for Native sawnwood 56,188 61,782 100,242 Power purchased from production of bleached ELECTRIC POWER 2,823 4,100 3,937

ORSA GRUPO utilities concessionaires 10,682 10,706 11,959 5,309 5,253 5,914 7,109 7,277 7,639 2,238 2,196 2,026 pulp 1,504,245 1,558,165 1,619,709 Power purchased from CHEMICALS (T) 4,055 4,121 4,484 1,379 1,379 1,679 1,880 2,055 2,140 790 623 877 ELECTRIC POWER 329,982 337,202 348,245 utilities concessionaires 2,823 4,100 3,937 Caustic soda 94 83 99 48 44 55 71 55 84 35 27 32 Internally generated power 329,982 337,202 348,245 Starch 3,686 3,703 4,065 1,180 1,152 1,392 1,672 1,861 1,903 697 543 770 CHEMICALS 31,045 41,788 35,217 Flexographic inks 275 335 320 152 184 232 137 139 153 58 54 75 Quicklime 12,199 15,821 15,461 ENERGY MATRIX Caustic soda 18,846 25,967 19,756 In tons 2,520 2,533 3,608 1,543 957 1,616 2,000 1,741 1,807 736 614 640 ENERGY MATRIX Bunker c oil 108 78 - - - - 2,000 1,714 1,807 736 614 640 In tons 749,621 733,311 742,600 Natural gas 2,412 2,455 3,608 1,543 957 1,616 ------Woods for biomass 713,169 694,648 668,395 54 Gcal 20,395 20,455 28,985 12,396 7,691 12,979 18,803 16,364 16,987 6,916 5,775 6,020 Charcoal - - 41,977 55 Bunker c oil 1,016 730 - - - - 18,803 13,364 16,987 6,916 5,775 6,020 Bunker c oil 36,452 38,663 32,228 Natural gas 19,379 19,725 28,985 12,396 7,691 12,979 ------Gcal 1,533,883 1,523,727 1,670,454 Gcal/ton produced 0.15 0.15 0.20 0.21 0.13 0.20 0.25 0.21 0.21 0.27 0.28 0.24 Woods for biomass 1,191,230 1,160,293 1,116,442 Bunker c oil 0.01 0.01 - - - - 0.25 0.21 0.21 0.27 0.28 0.24 Charcoal - - 251,065 Natural gas 0.14 0.14 0.20 0.21 0.13 0.20 ------Bunker c oil 342,653 363,433 302,947 Gcal/ton produced 4.28 4.28 4.28 Woods for biomass 3.33 3.26 2.86 Charcoal - - 0.64 Bunker c oil 0.96 1.02 0.78 Rocha factory has already been planned and preserved at the same time, with technologies in line with the concept Orsa Florestal, in charge of the forest of sustainability available in the market. management, maintains projects intended for preservation and rebuilding the Used areas ecosystem of the regions directly affected The performance of Grupo Orsa by industrial production, such as the 2008 REPORT SUSTAINABILITY companies involves an area of project for regenerating clearings. approximately 1.3 million hectares, among Moreover, the operations located in the

ORSA GRUPO forest and industrial operations in the surroundings of areas protected by law or Northern and Southeast regions of the identified as areas with high biodiversity country. To keep this area productive levels are rigorously preserved.

Energy and emissions installation of a filter that reduces gases In search of the efficient use of natural emission produced by the three boilers of resources in the whole productive the plant and the installation of a washer 56 chain and reduction of pollutant gases press, which cleans the fiber during 57 emissions, the Group accomplishes production more efficiently, enabling constant investments in the modernization recovering chemical products involved in the of its plants, such as the installation of process, which are not poured in the river. filters in all factories, process initiated Yet, to make productive processes in 2008, and an economizer in the main less pollutant, the substitution of fuels boiler of Paulínia site, which decreased like bunker c oil started in 2008 at the consumption of fossil fuels. Suzano and Paulínia units, by more At Jari Celulose, two expressive sustainable options, such as natural investments were accomplished: the plant. Inaugurated in 2008, Franco da NORTH REGION PROPER AREAS (in hectares) 1. APP 56,554.45 2. Reserve and other uses 1,088,699.41* 3. Operational area 119,905.00 3.1 Operational area planted 60,745.30 3.2 Operational area to be planted 59,159.70

2008 REPORT SUSTAINABILITY (1+2+3) Total area 1,265,128.86

(*) It includes areas of the states of Amapá and Pará, composed by annotated legal reserve, cities, airports etc. ORSA GRUPO SOUTHEAST REGION PROPER AREAS (ha) LEASED AREAS (ha) TOTAL AREAS (ha) 1. APP 4,402.67 3,945.46 8,348.13 2. Reserve and others uses 11,018.94 11,654.72 22,673.66 3. Operational area 14,170.64 10,170.01 24,340.65 3.1 Operational area planted 12,981.11 10,170.01 23,151.12 3.2 Operational area to be planted 1,189.53 - 1,189.53 (1+2+3) Total area 29,592.25 25,770.19 55,362.44 58 59 NORTH AND SOUTHEAST REGIONS PROPER AREAS (ha) 1. APP 60,957.12 2. Reserves and other uses 1,099,688.35 3. Operational area 134,075.64 Water 3.1 Operational area planted 73,726.41 In 2008, the total amount of new water and less expensive, Grupo Orsa invests in 3.2 Operational area to be planted 60,349.23 used by companies of the Group was cutting-edge technology equipment, as (1+2+3) Total area 1,294,721.11 56.069.563 m3, representing an increase that in operation at Franco da Rocha unit. of only 3% in relation to 2007. To make With closed circuit, the whole water of the use of water more and more efficient the unit is recycled. Besides Franco da Rocha, the most them back to nature without any kind of efficient units in the use of water are damage to the environment. Paulínia, reusing 85% of the water and Rio Verde, reusing 100% of the water used in Solid residues industrial processes, helping the Group In 2008, solid residues generated preserve the country’s hydric resources. by companies of the Group totalized 2008 REPORT SUSTAINABILITY 224,463.23 tons: TOTAL OF WATER USED PER PLANT

ORSA GRUPO New water and recycled/reused water TOTAL GENERATION OF SOLID RESIDUES – IN TONS Paulínia 1,421,748 85% Manaus 385 Rio Verde 13,000 100% To minimize impacts generated by the Marquesa 31 Nova Campina 9,500,000 30% capture or disposal of water during the Franco da Rocha 2,660 Jari 44,909,360 25% productive process, Franco da Rocha, Suzano 628 Suzano 6,100 98% Paulínia and Rio Verde units count on a Nova Campina 93,300 Franco da Rocha 120,355 75% circuit totally or partially closed, which Rio Verde 8,000 Manaus 65,000 50% helps the preservation of rivers near their Paulínia 15,300 Marquesa 34,000 0% facilities. Also in order to diminish impacts Jari/Orsa Florestal 104,159 60 to the environment, it was created in 61 Effluents 2008, at Manaus unit of Orsa Celulose, Besides monitoring generation, Grupo Grupo Orsa performs every kind of procedures Papel e Embalagens, a mechanism that Orsa takes specific steps in order to necessary to treat and monitor the liquid allows that part of the effluents – that reduce residues. At the unit of Paulínia, for effluents generated by its facilities, always in used to be discarded in the sewage example, programs are developed for water compliance with the valid laws in the country, collective network – is reused by the plant, recycling and drainage of residues sent to seeking the preservation of nature. Each of making the process more efficient from landfills, while Nova Campina counted on the productive units of the Group adopts the environmental point of view. the implementation of a laboratory that a management and monitoring planning The sites that do not reuse the effluents allowed the reduction of scraps generated according to the specificities of its operations. rely on treatment stations that allow giving at the wastepaper central. Concerns on biodiversity Social performance of work positions and revenue, as well as Preserving the areas in which it operates Aiming at reaching operations fully the formation of such audiences. and keeping the biodiversity of species is committed with sustainability, in a In November 2008, due to a partnership one of the commitments of Grupo Orsa. socially fair way, economically feasible with Joanna de Ângelis Association (AJA), For that, the companies develop actions and environmentally correct, Grupo the foundation increased its operations intended to monitoring the fauna and Orsa contributes for the sustainable launching in Rio Verde (GO) the first 2008 REPORT SUSTAINABILITY flora of forests, besides the improvement development of communities, especially project of the city: the Confection School of forest management, always jointly with those near the facilities of its companies, “SER-PRO”, which offers courses for young

ORSA GRUPO institutions internationally known. by adopting several social programs. people between 16 and 22 years old and Responsible for the preparation and sewing and patternmaking courses for EMBRAPA – Brazilian Agriculture and implementation of several projects, professional qualification of people over 18. Livestock Research Corporation many of them in partnership with other In partnership with more than 200 IBAMA – Brazilian Environment and companies of the organization, Fundação institutions, among NGOs, universities Natural Resources Institute Orsa is the main intermediary between the and different governmental spheres and, university of East Anglia (England) members of such communities and Grupo with Orsa Celulose, Papel e Embalagens, university of Toronto (Canada) Orsa. Based on a process to encourage Orsa Florestal and Jari Celulose, the university of Freiburg (Holland) the participation and collaboration of Group develops about 36 projects aiming 62 university of Wageningen (Holland) communities and, according to their real 63 State University of São Paulo needs, a survey is carried out to conceive State University of Pará projects that comply with the demands Federal University of Rio de Janeiro placed by childhood and adolescence, Federal Rural University of Amazon the family and community, always aiming fell upon a supplier that, due to the non- at the production and promotion of Environmental Occurrences compliance with the rules for destination knowledge, formation and qualification. In 2008, an occurrence of fine was of goods, was fined for three infractions. The main objective of such initiatives is to identified in relation to the transportation Grupo Orsa was exempted from any create conditions for the development and of hazardous products. The occurrence responsibility on the fact. implementation of projects for generation at the welfare and development of the Amarte All integrants involved have regions in which it operates and the Project started in 2005, the Association exceeded in the production of jewelry. society as a whole. Above, there are of Craftswomen of Jari Valley (Amarte) The support from Fundação Orsa to our some highlights of 2008: gathers enterprising women from Vale do enhancement made the production of Jari, region between Pará and Amapá, in 300 pieces possible within 5 days. To Graacc the north of the country, which, through join gold and silver to the work, which 2008 REPORT SUSTAINABILITY

Since 1992, Grupo Orsa holds a partnership k the production and sale of craft items, add was a dream, now is a reality with the Support Group for Teenagers and value to seeds, fibers and natural resources Aldenora Duarte dos Reis – Associated Member olitrenic ORSA GRUPO Children with Cancer - GRAACC, currently S from Amazon. In 2008, the Foundation

presided by Sergio Amoroso, with four projects ellie promoted technical enablement with renowned designers to improve the work among necklaces, earrings and bracelets, GRAACC/N

If every children’s hospital had a o of these women. Among these initiatives, which were marketed in Brazil and in ward like this, children would surely feel çã the Palmae Collection came up, bio-jewelry several countries. ivulga

much better, because in spite of being a D made of bacaba seeds, a tree that is the Thanks to the quality and beauty of place where no parent would like to take symbol of Amapá, with leather and silver Palmae Collection, Amarte was invited to his/her kid, it is where everything is done 950. Three hundred items were produced, take part of Expo Brazil Amazônia, event to relief suffering Fundação Orsa Libraries, a space at GRAACC that takes places between April and June 64 Valdir Francisco de Souza, Beatriz’s Hospital fully humanized, where children and 2008, in New York, besides Exposustentat, 65 father, 6 years old. teenagers undergo chemotherapy treatment International Fair of Sustainable Business, in a playful atmosphere. held at Transamérica Expo Center, in São developed in aggregate during such period “If every children’s hospital had a ward Paulo. The collection was a finalist for the – construction of GRAACC Hospital, laboratory like this, children would surely feel much Prize Casa Claudia. of genetics, chemotherapy, computerized better, because in spite of being a place “All integrants involved have exceeded accounting and HR system. Besides a number where no parent would like to take his/her in the production of jewelry. The support of partners that were presented by Grupo kid, it is where everything is done to relief from Fundação Orsa to our enhancement Orsa – the institution counts on the support suffering”, reveals Valdir Francisco de made the production of 300 pieces possible of the Foundation in several actions, including Souza, Beatriz’s father, 6 years old. within 5 days. To join gold and silver to the work, which was a dream, now is a reality”, “The TIC is a dream in the words of formation of citizenship, besides ensuring celebrates the entity’s president, Aldenora beneficiaries. Now we are able to interact rights, the project guarantees monthly Duarte dos Reis. with the whole world, have professional income to the women of the local community. information and access to information The whole cooperative production is Digital Interaction and, the best, we don’t need to pay for it. purchased by service providers to Grupo In partnership with the Government of the The Digital Interaction project came as Orsa and companies located in the area, with 2008 REPORT SUSTAINABILITY State of São Paulo, Fundação Orsa started fertilizer applied to the root of the growing annual demand of 10 thousand uniforms. up in 2008 the Digital Interaction Project, plant, which is going to make the young One of the 41 workers of the

ORSA GRUPO with the purpose of digitally including the people established in the countryside grow, cooperative, Deuzanira Fontenelle from inhabitants of settlings in the areas of Itapeva grow...”, explains the information technology Maranhão State, never had worked and did for those small producers, the Foundation and Itaberá, in the Southwest São Paulo. instructor of the village, Eliton Isac. not believed that would be possible. Mother intermediated in 2008 the sale contracts The initiative stimulates the interaction and of eight children and husband unemployed with Sodexo, company that supplies food participation of the settlers in the discussion Versatile Needles for five years, she thought she would never for the employees at Grupo Orsa, and that and search for solutions for the community’s With the purpose of inserting the women have a place in the society, until she heard purchased the horticulture production of needs, such as access to digital media, established at Vale do Jari in the local market about the Versatile Needles Project. “Today these farmers established at Vale do Jari, education and generation of job opportunities of industrial textile confections, whose annual I can tell I am proud of what I do. I found therefore encouraging local development. and income, among other benefits. demand belongs to 10 thousand uniforms, out sewing is a gift, my strength”. 66 In 2008, two Technology Interactive the Versatile Needles Project provides Corporate voluntary work 67 Centers (TICs) were inaugurated, where technical and enterprising training to 41 Family Agriculture Project With the social concern permeating the information technology and technical women. Idealized in 2003, besides offering In 2008, Fundação Orsa intensified a family companies of Grupo Orsa, several employees courses are offered, besides free access the opportunity for professionalization and agriculture project with small-sized farmers join forces every year and make part of to the internet to 530 inhabitants of the at Vale do Jari, which encompasses the the corporate voluntary work. Encouraged community. Among other achievements, plantation of vegetables, fruit, greens, by the Human Resources department. in 300 young people were qualified, in addition Today I can tell I am proud of “curauá” (kind of plant) and beekeeping. There 2008, 395 people, equivalent to 9% of the to the structuring of a common council for what I do. I found out sewing is a gift, were 303 family producers, involving 1,909 employees of the Group, engaged in social the project, with the purpose of promoting my strength people from 28 communities of the region. actions that helped transform the reality in political involvement of these communities. Deuzanira Fontenelle – Cooperative Member To guarantee the income generation the communities the companies operate. Development Program assured after some years, without alienation Curauá Project Launched in 2001, the Forest Development of the property and with payments since the Among the development program Program created by Grupo Orsa arose beginning of the contract. initiatives taken by Fundação Orsa at to meet the needs of the company for The Group also supplies seedling Vale do Jari, there is the Curauá Project, enlarging its forest base in a sustainable and all technical support for planting a typical plant of the Amazon Region way, benefiting the communities of the and managing the forests. The program whose cultivation has been changing the 2008 REPORT SUSTAINABILITY areas operated. Accomplished at Vale do provides purchase warranty to the reality of the family agriculture. With the Jari and Southwest of São Paulo state, development and future supply of wood guidance of professionals of Grupo Orsa,

ORSA GRUPO in 2008, the initiative reached 14,486 for the company. plantations have been getting scale and thousand hectares, with 486 contracts. Results are already visible. All farmers becoming another economic development In synergy with small and medium owners that took part of the two first years of the model. Its high-resistance fiber is used by of the region, the companies of Grupo Development Program had their agricultural automobile companies. In 2008, R$ 10.35 million were invested Orsa encourage the eucalyptus and pinus productivity increased, accordingly their In progress since 2006, the project in programs and projects, by means of cultivation, directed to small producers, by quality of life improved. Moreover, most supports 49 farmers in the region of Vale donations received, enabling direct and purchasing in advance part of the production farmers stayed in their areas, reducing the do Jari, developing family agriculture in indirect support to 333,225 people. in exchange of having the delivery of product rural exodus and decreasing the speculation 15 communities and ensuring an annual Donations come from the companies of pressure on land and the purchase and income of R$ 4,800 for each family. The the Group (81.12 %), from other donators 68 illegal sale of wood. perspective is that the project involves (8.75 %) and from government subventions 69 As part of the Forest Development 100 farmers up to 2010, organized for (10.13 %), modality for transferring public Program, Fundação Orsa encourages the business management and fiber resources to private and public institutions, the planting for safety feed and income commercialization. with supportive nature and without generation during the growth of eucalyptus profitable purposes, which develop projects and pínus trees. With the support from the Private Social Investment in partnership with government agencies. Foundation, the companies of the Group With an investment of more than Most value directed to Fundação Orsa analyze vocations and potentialities of each R$ 145 million up to 2008, the Foundation regards to the transfer of 1% of gross fomented member and suggest the best has reached approximately 6,65 million revenue earner by Grupo Orsa, which is productive options. beneficiaries in its 15 years of history. dedicated to social actions. 2008 REPORT SUSTAINABILITY ORSA GRUPO

Appendices 70 71 Vision and strategy Page 3.11 Changes in scope, limits or Performance Indicators Page EN12 Significant impacts on biodiversity 1.1 President statement 6 measurement method 8 - 9 Economic performance from activities, products and services 62 Corporate Profile Page 3.12 Summary of GRI contents 72 - 75 EC1 Direct economic value generated EN13 Protected or restored habitats 57 2.1 Organization name 12 3.13 External data check 33 and distributed 36 EN14 Strategy to manage impacts 2.2 Products and services, including brands 15-23 Governance, Commitments and Promise Page EC7 Local hiring Not informed on biodiversity 51 - 62 4.1 Organization’s governance structure 28-33 Environmental Performance EN16 Total of greenhouse gas direct 2.3 Operational structure 15-23 2008 REPORT SUSTAINABILITY 4.2 Governance group chairmanship 30 EN1 Materials used according and indirect emissions Not informed 2.4 Organization home office location 14 4.3 Percentage of council members to weight or volume 53 - 55 EN18 Actions to decrease greenhouse 2.5 Countries and region where who are independent non-officers None EN2 Percentage of materials used gas emissions and obtained reductions 56 - 57 the organization works 14 ORSA GRUPO 4.4 Mechanisms for shareholders that come from recycling Not informed EN20 NOx, SOx and other significant 2.8 Organization size 15-23 to make recommendations EN3 Discreet direct power atmospheric emissions Not informed 2.9 Changes during report time span None to the Management Council 28-29 consumption according to EN21 Total disposal of water according 2.10 Awards granted during the period 24 - 25 4.5 Ratio between remuneration primary power source 53 - 55 to quality and destinations Not informed Report Profile Page and organization performance 41 EN4 Direct power consumption according EN22 Total waste weight according 3.1 Report time span 8 - 9 4.6 Processes to avoid interest to primary power source 53 - 55 to disposal type and method Not informed 3.2 Former report date 8 - 9 conflicts in force at the EN5 Power saved due to conservation EN23 Number and total volume

O F GRI CONTENT SUMMARY 3.3 Report issuance cycle 8 - 9 highest governance body 28-33 and efficacy improvements Not informed of significant spills Not informed 3.4 Contact data in case there are 4.7 Qualification of members from EN6 Actions to provide products and EN24 Weight of transported wastes that questions relating to the report 72 the highest governance body 30 services with low power consumption 56 - 57 are considered as hazardous Not informed 73 and its contents 9 4.8 Statements of mission and values, 12 - 13 EN7 Actions to decrease EN25 Protection description and Report Scope Page conduct codes and internal principles consumption of indirect power rate of biodiversity of water 3.5 Contents-definition process 8 - 9 4.9 Responsibility for implementing and obtained reductions Not informed resources and habitats Not informed 3.6 Report limits 8 - 9 economic, environmental EN8 Total of removed water EN26 Actions to mitigate 3.7 Possible scope limitations or limit 8 - 9 and social policies 29 according to source 59 - 60 environmental impacts 51 - 62 3.8 Basis for considering joint ventures Commitments to External Enterprises Page EN10 Percentage and total volume EN28 Amount of fines and total and subsidiaries 8 - 9 4.12 Principles and/or other externally of recycled and reused water 59 - 60 number of sanctions from 3.9 Data measurement techniques 8 - 9 developed actions 62 - 69 EN11 Location and size of owned area 58 nonconformity to laws Not informed 3.10 Review of published information 8 - 9 EN30 Total of investments and expenditures makeup and proportion according Society Page PR4 Non-conformities There are no in environmental protection 52 to groups and kinds 30-31 SO1 Programs and practices to assess related to product and records of cases Social Performance Page LA14 Ratio of basic salary and manage impacts of operations service labeling of that kind Labor Practices between men and women, on communities 63 - 69 PR5 Practices related to client LA1 Total of laborers according per functional category Not informed SO2 Units submitted to risk assessment satisfaction, including survey results 44 - 47 to type of employment, labor Human Rights Page related to corruption None PR7 Instances of non-conformity There are no

2008 REPORT SUSTAINABILITY contract and region 39 HR1 Description of policies and directives to SO3 Percentage of employees There is no related to communication records of cases LA2 Total number of jobs and manage all aspects of human rights Not informed trained in anti-corruption anti-corruption of products and services that kind turnover according to age range, HR2 Contracted companies submitted No supplier policies and procedures training PR8 Proven claims relating There are no records ORSA GRUPO gender and region 39-40 to assessments relating with SO4 Measures taken in Opening to client privacy violation of cases of that kind LA3 Comparison between full-time and to human rights such profile response to cases of an internal PR9 Fines for non-conformity There are no part-time employee benefits Not informed HR4 Total number of cases of discrimina- of corruption investigation related to the supply and use records of cases LA4 Percentage of employees tion and measures adopted Not records SO5 Standing about public policies Not informed of products and services of that kind covered by collective HR5 Association freedom Employees are SO6 Policies for financial The Group bargaining agreements Not informed policy and its free to associate donations to political parties does no LA6 Percentage of employees application level to unions or institutions contribute to represented in formal health HR6 Measures taken to help The Group does political parties and safety committees Not informed abolish child labor not perform any with cash 74 LA7 Rate of injuries, occupational activity or use any SO7 Number of legal There are no 75 diseases, and days missed Not informed product of child labor proceedings due to occurrences in LA8 Programs for education, prevention 48-49 HR7 Measures taken to help There is no unfair competition that sense and risk control Not informed eradicate forced labor operation with SO8 Description of significant fines LA10 Average of hours per training per year 42 possibility of and total number of LA11 Programs for managing forced labor non-monetary sanctions Not informed competences and continuous learning 42-47 HR9 Total number of cases There are Responsibility for the product Page LA12 Percentage of employees that of violation of native no cases of PR2 Non-conformities related There are no get performance analyses Not informed peoples’ rights and violation of native to impacts caused by records of cases LA13 Top management and council measures taken peoples’ rights products and services of that kind GRUPO ORSA SUSTAINABILITY REPORT 2008 Alameda Mamoré,989 –25 GRUPO ORSA–CORPORATE OFFICE CORPORATE INFORMATION All Tasks Traduções Técnicas translation stockimage/AgênciaGurpo Orsa L Pictures Graphic designandgraphicproduction C ACKNOWLEDGEMENTS Phone: (11)4689-8700 Barueri –SPCEP06454 oordination -040 th floor–Alphaville uz relatório de sustentabilidade 2008 grupo orsa relatório de sustentabilidade 2008