Sappi North America: Sustainability Report (2019)
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2019 Sustainability Report Sappi North America 02 04 06 08 A letter from Summary of Overview of World-class Mike Haws Sappi Limited Sappi North America assets 10 13 21 31 SNA sustainability Sustainability Prosperity People leadership goals 41 49 57 Planet Key performance A letter from indicators Sandy Taft About this report Sappi North America (SNA) has been publicly reporting progress Looking for even more on sustainability? on sustainability initiatives since 2008 as part of a global Scan the cover of this report. sustainability report, issued annually by Sappi Limited. This is the ninth consecutive year that SNA has issued its own sustainability report, with consolidated global sustainability performance included in the annual report to shareholders. Sappi Limited will continue to publish a separate online report in conformance with the Global Reporting Initiative’s G4 framework and disclosing compliance with the United Nations Global Compact (UNGC), to which we are a signatory. Covering the fiscal year 2019 (FY19) from October 1, 2018, to September 29, 2019, this year’s report focuses on performance against goals and an update on key performance indicators. Step 1 Step 3 The report includes environmental performance data for SNA’s Download the Sappi XP and Tap the Scan button and North American manufacturing operations in Skowhegan, Maine; Paper Calculator app on the scan the cover of the Westbrook, Maine; and Cloquet, Minnesota. Metrics for the App Store or Google Play 2019 Sustainability Report recently acquired Matane, Quebec, mill will be included in next Step 2 Step 4 year’s report. Social responsibility and prosperity metrics are Launch the app on your Watch our video on reported for the full region, including our corporate facilities, sales mobile device and tap sustainability and start offices, and sheeting facility in Allentown, Pennsylvania. Copies the Live Print button at making a difference today of reports produced by Sappi Limited can be accessed at the bottom sappi.com/investors. Online access to sustainability reports from Sappi’s regional divisions in Europe and South Africa can be found at sappi.com/sustainability-sappi-group. A letter from Steve Binnie This past year saw significant In 2019, a debottlenecking project at Cloquet Mill was completed that will boost dissolving wood pulp progress at Sappi North America production. Another significant highlight was the acquisition and integration of the Matane high-yield (SNA). For the second year running, pulp mill in Quebec, Canada, to bolster further expansion we produced an excellent safety in the group and the region’s packaging and speciality paper capacity. Sales volumes and contributions performance—again lowering the increased from packaging grades produced on the converted Paper Machine 1 (PM1) at the Somerset Mill, injury frequency and severity ratings delivering on our strategy to increase capacity in higher-growth and higher-margin product segments. to record-low levels. I would like to As a renewable resource company, we are focused thank each and every staff member on maintaining the health of the forests, insisting that our timber suppliers apply responsible forestry management for their personal commitment to practices and encouraging the use of third-party certification programs. This past year, we worked with this journey. our print customers to secure the benefits that print- based communication delivers and supported the local economies where we operate through ongoing investment in our facilities. We also continued to provide customers with sustainable, responsible, and renewable product choices in a carbon-constrained world. SNA is well-placed to deliver value across all of our sustainability goals during 2020. Steve Binnie Chief Executive Officer Sappi Limited 2019 Sustainability Report 1 A letter from Mike Haws As we look ahead to the next five years of growth and innovation, we couldn’t be more optimistic about our prospects here at Sappi North America (SNA). We have the strongest team in the industry, a team that has tackled issues head-on, transforming our company into a well-diversified and resilient organization. Our commitment to sustainability provides us with a competitive advantage in a market demanding renewable resource solutions, and delivers enhanced value to all stakeholders. Our approach establishes a path for future investment and growth for the benefit of all of our employees and the local communities where they live and work. We have a bold vision for Sappi North America and complementary values, which we see as providing the foundation of our future collective success. Safety Investment in our employees Our commitment to the safety and well-being of our and in our communities employees is a bedrock value shared by all of us at SNA. No company can achieve sustained success without Without a demonstrated track record of continuous engaged, empowered, and inspired employees. safety improvement, we simply would not be a successful In 2017, we established sustained engagement as a company. We finished our fiscal year 2019 with a lost global five-year goal to foster collaboration with our time injury frequency rate (LTIFR) of 0.25—the second employees; in 2019, we earned a score of 78%, in line consecutive year where we achieved our lowest full-year with other global manufacturing companies, and we result ever. In addition, our severity rate has declined strive to do more. We have rolled out an employee significantly from a high of 1,673 lost workdays in 2011 recognition program, TOUTS, which celebrated more to 588 lost workdays in 2019—a 65% decrease. This than 2,700 acts of excellence from SNA employees impressive safety performance reflects the engagement in 2019. Additionally, this past year alone, we provided and focus of all of our employees and the personal 105 hours of training per employee (more than 2 ½ accountability they bring to the job every day. weeks) on average. We recognize our responsibility extends to advancing the vibrancy and health of our communities where we work and live. We invest in our local communities, providing educational and training resources as well as leveraging the energy and passion of our employees through our Employee Ideas that Matter grants. We support local college and university programs not only through financial support but through company mentorship programs. We are active members of the community, participating in educational, charitable, and civic events throughout the year. We know that giving back to our communities makes us stronger. 2 Sappi North America Reflecting the values Looking ahead of our customers As the newly appointed President and CEO of Sappi North America, and on behalf of the organization, Our long-term success depends on our customers. I would like to thank my predecessor Mark Gardner We must strive every day to deliver products and for providing us with the foundation of a strong, well- services that anticipate their needs and satisfy their invested company. I look forward to working with the requirements for consistency, reliability, and advantaged full SNA team—including all the talented Matane performance. The far bigger challenge now is to employees who just joined us in November—to build understand our customers’ needs beyond product our future. While the common benchmark of success attributes and service. Our customers want to know is improved profitability and stronger financial returns, it the environmental footprint of our products and services. is only through the continued support of our employees, They want to understand our strategies and success suppliers, and communities that we will achieve our in reducing waste throughout our manufacturing process ultimate goal of providing the best solutions to meet and logistics networks. They demand that we design the needs of our customers. products with end of life in mind—with a renewed focus on recyclability and compostability. They also expect greater transparency in the full supply chain they are part of, asking us to assess and mitigate risk in our supplier base. We are working hard on all of these fronts. We Mike Haws have re-engaged our Sustainability Customer Council, President and Chief Executive Officer, with representatives across our businesses, to hear Sappi North America their candid feedback on our sustainability progress and emerging priorities. We have issued at the group level a Supplier Code of Conduct, which asks our suppliers to step up their commitments to us and our customers. We relaunched our eQ Calculator to provide our customers with the ability to assess the carbon footprint impact of their purchase decisions, and we’re committed to increasing transparency of our footprint reporting going forward. Natural resource stewardship and advocacy Sappi recognizes its responsibility to act as a steward of natural resources, so we promote sustainably managed forests, energy, soil, and water conservation, and clean air. We are in the process of setting new forward-looking five-year goals that will be tied to our capital and business plans. We are committed to reporting our sustainability progress publicly. These goals capture the key elements of our stewardship commitments to minimize waste, improve energy efficiency, and ensure we only source from low-risk forests. Many more measures are captured in our Key Performance Indicators section, also reported publicly. Lastly, we recognize that our advocacy in the global business community counts. Sappi was an early supporter of