274 granted patents and patent validations in 2020 306 patent filings and validations in 2020
start-up companies. Collaboration speeds up the development and launch of new solu- tions, particularly for new businesses. The partnership with the European Joint Undertaking on Bio-Based Indus- tries (BBI) focuses on strengthening the competitiveness of bio-based products in Europe. As a shareholder in the Finnish company CLIC Innovation Ltd, we aim for breakthrough solutions in the bioeconomy, circular economy and cleantech. We are also a member of FinnCERES Ecosystem to collaborate on research into lignocellu- lose-based materials. In 2020, UPM joined the Renewable Carbon Initiative (RCI), which promotes the goal of making chemicals more sus- tainable and more climate-smart. UPM Specialty Papers and UPMRaflatac collabo- rated with 4evergreen Alliance, a initiative by CEPI to further accelerate the fibre- based packaging in the circular economy. UPMRaflatac and UPM Specialty Papers joined a new global industry-wide consor- tium CELAB to boost liner recycling in the labelling industry. UPMBiofuels joined the BIKE project promoting sustainable bio- mass value chains for biofuels in Europe. Towards a future beyond fossils on page 16 From forests to sustainable products on page 18 Responsible product lifecycle on page 82
A solid patent portfolio boosts our com- petitive edge. Licensing of innovations and technologies provides an excellent basis for value creation with customers and technol- ogy partners. More value from digital opportunities We aim to significantly increase the speed and quality of decision-making, culture of data utilisation and innovation by lever- aging high-quality, compliant and modern common data services. Much of what we focus on relates to building the data founda- tion, including common platforms, digital customer experience, digital supply chain and intelligent operations. After having created a rich portfolio of digital projects and initiatives, we created a solid operating model in 2020. As part of the model, data governance management oversees the strategic focus areas, data prin- ciples and related initiatives. Also in 2020, we created the Data Management Office (DMO) and started to work on UPM’s Digi and Data strategy to achieve more impact and business value from the digital and data-driven opportunities. Extensive partner network Our close-knit global partner network is comprised of customers, universities, research organisations, suppliers and
to climate change mitigation is renewable hydrogen. Potential commercial applica- tions using various technologies are evalu- ated with the aim to lower CO 2 emissions. We also became a member of the European Clean Hydrogen Alliance. Sustainable product development Our R&D activities are guided by our 2030 responsibility targets and integrate contri- bution to the UN Sustainable Development Goals (SDGs) into product development. In 2020, we renewed our sustainable product design concept. We carried out a pilot case in the development of sustaina- ble lignin products. In 2021, the work will continue with sustainable packaging and other business areas. Special focus on sus- tainable product development will be put on circularity. We are also examining new ways to utilise sustainable fibre-based materi- als that are being developed for textiles, nonwovens, hygiene products and flexible packaging, for example. New solutions are developed in collaboration with our busi- nesses, technology partners and customers by using revised ecodesign approach as part of sustainable product development con- cept. We see the residues and side streams as valuable raw materials and thus real business opportunities. Solid patent portfolio The significance of the patents, trademarks and intellectual property rights protecting our innovations is more pronounced in our new businesses, supporting the journey from innovation to business. We have nearly 3,000 patents and patent applica- tions, and nearly 1,400 trademarks globally.
INNOVATING FOR THE FUTURE
Research and development, bioeconomy innovations and new technologies support our transformation and expand our business portfolio.
We are developing innovative, high-quality products fromwood-based biomass. Wood fibres, biomolecules, residues and side streams are becoming increasingly important rawmaterials of the future. Innovation and R&D programmes are essential in the development of new products and technologies. Research and development funding is primarily being used on studying new technologies and developing businesses and processes. A global network of research centres provides support for UPM’s activities in R&D, both in new and existing businesses. In 2020, UPM spent EUR 189 (121) mil- lion on research and development, making up 18.8% (6.6%) of UPM’s operating cash flow. In addition to direct R&D expenditure of EUR 41 (53) million, the figure includes negative operating cash flow and capital expenditure in developing businesses, transformative growth projects and digitali- sation projects.
experience and expertise in the new and existing businesses. Strategic research further accelerates the commercialisation of bio-based solutions into viable industrial processes in a cost-efficient way. In 2020, special focus was on new value chains in our growth businesses: biochemicals, biofuels and specialty packaging. Innovating climate-positive products Our products offer solutions to mitigating climate change as they replace fossil raw materials with bio-based renewable alter- natives. The products store carbon for the entire duration of their lifecycle, especially when recycled multiple times. We are committed to a climate-positive product portfolio. Many of our products are already proven to be climate positive. In the future, we aim to scientifically verify the climate impacts of all our products. One example of our research related
Accelerating the development and scale-up of new molecular businesses Molecular bioproducts form one of UPM’s three strategic focus areas for growth. Our biorefinery investment in Leuna, Germany, will enable a switch from fossil rawmateri- als to wood-based sustainable alternatives in textiles, plastics, PET bottles, packaging and pharma or cosmetics products. We have also successfully entered the biofuels business and built a profitable and sustainable business platform. Develop- ment is currently ongoing, with the aim of expanding the biofuels business with new types of technology concepts and bio- mass-based rawmaterials. In January 2021, we started the basic engineering phase of a potential next generation biorefinery. Our new state-of-the-art R&D Biofore Base in Lappeenranta, Finland, combines research, piloting and analytics, and unites our technologies, globally accumulated
SIGNIFICANCE • The increasing demand for renewable and recyclable materials as we search for alternatives to fossil-based raw materials • The growing consumption in emerging markets, requiring responsibly produced solutions • Bioeconomy offers sustainable solutions to the challenges of global megatrends TARGETS • Developing products and innovations that replace fossil-based solutions and create added value and growth • Creating new business OUR WAY • Strong expertise in forest biomass processing • Responsibility and circular economy • Resource efficiency, product stewardship and ecodesign across the entire value chain • Technological development and intellectual property rights • Innovation culture, current and future competences • Extensive partner network