UPM Annual Report 2019

SUMMARY OF OUR SOCIETAL IMPACTS

Our activities and products have impacts on society. Understanding these impacts is a prerequisite to develop our operations. The evaluation covers our value creation from economic, social and environmental perspective. Indirect inputs and outputs provide a more comprehensive picture of the value chain. Together with the direct inputs and outputs they form the basis for impact evaluation.

UPM

INDIRECT UPSTREAM

DIRECT UPSTREAM

DIRECT DOWNSTREAM

INDIRECT DOWNSTREAM

RAW MATERIALS

PRODUCTS

EMISSIONS TO AIR

Number of b-to-b suppliers

24,000

12,500

Number of customers

8.2m t

8,500 t

Paper

Nitrogen oxides

27.5m m 3

Wood

3.7m t

1,100 t

Chemical pulp

Sulphur dioxide

Forest owners in Finland supplying wood to UPM

over 220 million

People using UPM products

2.3m t

18,000

Recovered paper

0.6m t

710 t

Converting materials

Particulates

54 production sites in 12 countries

660 t

0.8mm 3

VOC t

Plywood and veneer

2.1m t

Minerals

Value of products eligible for ecolabelling

Supplier and Third Party Code qualified supplier spend

EUR 8.4 billion

Fossil CO 2 (scope 1)

emissions

84%

3.0m t

1.7mm 3

Sawn timber

1.7m t

Market pulp

11,000 GWh

Electricity and heat

Virgin materials replaced

82%

Purchased paper for converting Plastics, adhesives, resins, films

Certified wood

3.3m t

0.5m t

1.0m t

By-products

EMISSIONS TO WATER

EUR 10,238m

Sales

Percentage of wood origin known

0.2m t

100%

Carbon stored in UPM products

18m t

991,000 ha forests and plantations

210m m 3

Process wastewater

EUR 1,404m

Comparable EBIT

Co-mingled domestic waste

0.2m t

11.2%

Comparable ROE

190m m 3

Cooling water

50 million

Seedlings planted

Fossil CO 2 emissions (scope 3 downstream)

3.2m t

EUR 4.5 billion

EUR 693m

Dividend distribution

Costs, raw materials

Biological oxygen demand (7days) t

7,300 t

UPM forests available for free recreation use

Employee wages and benefits

EUR 1,214m

Biofore Share and Care donations and sponsorships

586,000 ha

EUR 2.1m distributed to 285 groups

WATER UPTAKE

60,300 t

Chemical oxygen demand

Corporate income taxes paid and property taxes

EUR 211m

416m m 3

Surface water

Adsorbable organic halogens

280 t

18,700 employees Approx. 100,700 shareholders

Ecosystem services

EUR 440m

Payments to providers of loans Granted patents and patents validations

EUR 49m

19m m 3

Ground water

emissions

Fossil CO 2 (scope 2 & 3 upstream)

337

6.4m t

4m m 3

Communal water

PEOPLE

SOLID PROCESS WASTE

Water intensive production sites located in water abundant areas Restricted chemical substances in UPM screening

99,800 dry t

71% favourable

Employee engagement index

ENERGY

100%

To landfills

27,000 GWh

Renewable fuels

Training hours per employee

12

13,300 dry t

To temporary storage

Capital employed EUR 11,474m Net debt EUR –453m Market cap EUR 16,485m

6,000

To incineration without energy recovery Hazardous waste for special treatment

11,600 GWh

Fossil fuels

Total recordable injury frequency incl. contractors Lost-time accident frequency incl.contractors

6.8

1,500 dry t

Purchased electricity and heat

2,300

New hires

13,000 GWh

3.3

5,100 t

OUTCOME & IMPACTS

Impact valuation of landfilled waste EUR –14m*

Purchase power of workforce and share- holders EUR 1.9b

Impact valuation of ash used as raw material EUR 18m*

Vitality and prosperity for

Biodiversity enhanced

Impact valuation of recreational use of UPM forests EUR 80m

Enhanced business practices in the value chain

Impact valuation of GHG emissions EUR –190m*

Increasing knowledge and quality of life through our products

Impact valuation of net carbon binding of UPM forests EUR 13m*

Multiplicative effects of value added EUR 3.0b

Health impact on employees and contractors

Employee skills enhanced

Climate change mitigation through UPM’s climate actions

sphere of influence

Impact evaluation is a continuous process for UPM. In 2017, UPM initiated a pilot study to assess the monetary value of certain impacts.

This study provided us with examples shown on the right ( * ) . In 2018, UPM piloted a new approach for net impact analysis.

98

99

OUR WAY

OUR WAY

UPM ANNUAL REPORT 2019

UPM ANNUAL REPORT 2019

CONTENTS