UPM Annual Report 2017

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Stakeholders

In brief

Strategy

Businesses si s s

Governance

Accounts

UPM businesses actively engage with stakeholders

In addition to the group-wide focus areas, UPM’s businesses had their additional focus areas in stakeholder dialogue in 2017. Customer collaboration is presented on pages 56–57, employee activities on pages 44–49.

INDUSTRY LEADER Our consistent efforts regarding responsibility issues have received recognition from several third parties and have made us one of the industry leaders in several fields.

Global Compact LEAD

UN Global Compact LEAD: UPM is the only forest-industry company and Finnish company participating in the UN Global Compact LEAD. Dow Jones Sustainability Index: UPM has been listed as the industry leader in the forest and paper sector in the Dow Jones Sustainability World and Europe Indices (DJSI) for 2017–2018. CDP Programs: UPM has been recognised with a global leadership position in the 2017 Forest A List and Water A List. UPM received an A- leadership position in the CDP Climate programme. UPM Biofuels won the Industry Leadership category in Bioenergy at the 2017 Platts Global Energy Awards — often described as the Oscars of the energy industry.

GOVERNMENT AND REGULATORS Discussions with the Govern ment of Uruguay regarding the development of logistics infrastructure as a prereq uisite for a pulp mill invest ment resulted in an invest- ment agreement. In Finland, discussions on logistics and transport. Discussions with Finnish and EU politicians and authorities on future biofuel policies. Active co-operation with local authorities on logistics, traffic and permits. Sawmill visits. Discussions with Finnish and EU politicians and authorities on energy policy development. Active co-operation with local authorities regarding environmental investment in Changshu, China. High Tech status of the UPM Changshu mill. Active participation in industry associations’ programmes, contribution to industry standards. Discussions on the operating environment and competi tiveness of the Finnish forest industry. Discussions with local authorities in Germany, Austria and the US on the divestment of hydropower assets. Contribution to indus try and government expert groups on energy, RCP and wood sourcing in Central Europe. Active participation in the industry associations’ work. Hosting policy maker visits to the various mills. Discussions with EU and Finnish politicians and authorities on forest and biomass policies. Discussion with Finnish authorities on sustainable forestry, voluntary forest protection and active forest ownership promotion. Discussions with Finnish and EU authorities on standards, directives and regulation.

BUSINESS

COMMUNITIES

SUPPLIERS

NGOs

MEDIA

Finland: forest trips, tree planting events and an arts and crafts competition for kids. “Local Waters” project at schools. Recruitment events and excursions for students. Uruguay: regional technical university and other training pro- grammes. UPM Foundation activities. Distribution of UPM Fray Bentos tenth anniversary issue of Espacio magazine. Co-operation with universities and research institutes (VTT, LUT), associations (Association for Finnish Work) and certification bodies and auditors (ISCC, RSB). Participation in seminars and conferences. Active participation in local events and projects, e.g. DuuniExpo recruitment event and building an unobstructed nature trail in Pietarsaari. Forest owner visits the sawmills. Participation in Nordic Energy Forum 2017 congress. Innovation event Industryhack and student workshops. Local sponsorships, e.g. Icehearts in Finland, river clean-up in North Carolina, USA and Water Cellar for Mothers initiative in China. Collaboration with local communities and responsibility programmes: “Green Future” in China, “Local Waters” school project in Finland. Tree planting days in Finland and China. “Mini Library Project” and “Little Scientist Labs” continued. Partnership with Stiftung Lesen. Community engagement at mill locations through micro-sponsorships, donations and volunteering, as well as recruitment activities focused on school and university students. Zero Solid Waste programme in Finland.

Safety training with contractors. Co-operation on technical development with machine suppliers.

Uruguay: Aves Uruguay, BioUruguay, DESEM, Vida Silvestre.

Communications on growth plans in Uruguay and related topics. Mill events and visits.

UPM PULP

SKILLS FOR WORK

Safety training with contractors. Continuous dialogue and supplier audits.

Co-operation with the Roundtable on Sustainable Biomaterials, Below50 coalition and Zero Emission Resource Organisation (Norway).

Visits to biorefinery, interviews and communications on mill events.

UPM BIOFUELS

The third one-day Slush Youth event welcomed high-school students from around the Nordic countries to learn practical working and entrepreneurship skills. A total of 300 secondary-school students participated in UPM’s workshop on sustainability in business. UPM also reached out to students through the Bio Era event tour. The main attraction on the tour was the Bio Era truck – a science centre on wheels. The tour around Finland included school visits and public events across Finland. The Words Matter project – supported by UPM and organised by the Finnish Reading Centre – was completed at the end of 2017. Around 3,000 students from technical vocational schools participated in the literacy workshops during the project. The workshops took a practical approach to reading skills, acknowledging the students’ own interests. During autumn 2017, UPM took pupils from sixth grade to learn about forest management at UPM mill locations in Finland. Around 1,400 students took part in the forest trips. The "Local Waters” school project also continued throughout the year at UPM’s paper mill locations in Finland. As part of the project, primary school students carry out assignments related to water and then use smart phones to send study results to their teachers. UPM has donated equipment required for studying water to schools. Together with Helsinki Think Company, UPM challenged university students to find solutions to improve dialogue with stakeholders at UPM’s mill locations. The Mini Challenge competition involved discussions on responsi bility in business operations and stakeholder engagement. The projects are part of UPM’s Biofore Share and Care programme. The focus areas are reading and learning, engaging with communities, responsible water use and boosting bioinnovations.

CLIMATE

Induction and training for maintenance and logistics companies.

Interviews.

UPM TIMBER

The Nordic Bioeconomy Panel included UPM BioVerno renewable diesel and GrowDex ® 3D cell hydrogel in the Nordic Bioeconomy 25 Cases for Sustainable Change catalogue. UPM’s Zero Solid Waste to Landfill initiative received the Gold Award in the Midwest Region Sustainability competition. Water Efficiency Frontrunner: UPM has been recognised as a Water Efficiency Frontrunner in China, in one of the key initiatives launched by the government to reduce industrial emissions.

Collaboration related to hydropower maintenance and Harjavalta investment. Label Life Awards for suppliers, supplier audits, joint projects and workshops. Training on compliance, the Code of Conduct, responsibility and safety. Supplier Day in Changshu, China. Safety training with contractors. Continuous dialogue and development of co-operation based on annual supplier survey and audits. Supplier audits. Joint UPM Safety Team. Management training programme for contractors. Nature management training. Griffin e-learning environment. Continuous dialogue and development of co-operation with key suppliers and service providers. Supplier mapping and categorisation. Supplier qualifications and audits. Continu- ous dialogue with main suppliers. Briefings on supplier compliance.

Promotion of UPM Energy expertise and service offering.

UPM ENERGY

Sustainability partner ships with WWF Poland and WWF South Africa. Project for the reforesta tion of the Jaguari River in Brazil. Joint programmes on sustainable forest management and sustainable paper with the China Sustainable Paper Alliance (CSPA)

Factory visits, press conferences on main events.

UPM RAFLATAC

Regular media coverage, Chinese media trip to Finland, media roundtable, mill visits and social media development.

UPM SPECIALTY PAPERS

and China Green Foundation (CGF).

Chairmanship of the board of Biodiversity in Good Company.

Mill visits and background

UPM PAPER ENA

meetings, active dialogue around various topics incl. restructuring. Responsible Fibre concept.

Open door events at several mills. Apprenticeship programmes at the mills.

Background meetings and briefings, e.g. on new plywood technologies. Press conferences and background discussions on new products and services and the wood market. Several interviews and coverage on trade press. Press release on biorefinery basic engineering. Campaign celebrat ing ten years of UPM ProFi recycling materials to create the Design Deck range.

UPM PLYWOOD

Local events to demonstrate modern forestry methods and to discuss sustain able forestry topics. Dialogue with communities on logging plans. Forest trips for 1,400 Finnish 6th grade students. Forest Fair in Finland. Bio Era tour in Finland. Co-operation with universities and research institutes in Finland, Central Europe and the UK. Development co- operation with start-ups and SMEs. The third scientific “Visions for 3D cell culture” seminar. Technology development co-operation with universities. Participation in housing fairs and exhibitions. Closed material circulation in production.

Stakeholder event at Verla. Joint projects with BirdLife and Osprey Foundation. Meetings and forest visits. Continuous dialogue.

WOOD SOURCING AND FORESTRY

UPM BIOCHEMICALS

Active participation in national and Europe-wide wood plastic composite standardisation development.