CDP 2015 Forests 2015 Information Request - Sappi · 2016-09-08 · CDP CDP 2015 Forests 2015...

CDPCDP 2015 Forests 2015 Information RequestSappi

Module: Introduction

Page: F0. Introduction

F0.1

Please give a general description and introduction to your organization

Sappi is a global pulp and paper company operating in a number of countries. The company is split into three regions: South Africa, Europe and North America. Thenature of the operations differs substantially in each region with respect to the management of GHG emissions. Globally Sappi works closely with customers, bothdirect and indirect, in over 100 countries to provide them with paper, paper-pulp, speciality- and packaging paper, as well as dissolving wood pulp products andrelated services and innovations. All of these are based on woodfibre, a renewable natural resource grown in sustainably managed forests and plantations. Sappi'smarket-leading range of paper products includes: coated fine papers used by printers, publishers and corporate end-users in the production of books, brochures,magazines, catalogues, direct mail and many other print applications; casting release papers used by suppliers to the fashion, textiles, automobile and householdindustries; and in the Southern African region the paper grades include newsprint, uncoated graphic- and business papers, premium quality packaging papers,security papers and paper grade pulp. The paper pulp needed for the group's products is either produced within Sappi or bought from accredited suppliers.Dissolving wood pulp is produced by Sappi Southern Africa and Sappi North America and is used worldwide by converters to create viscose fibre, acetate,pharmaceutical products as well as a wide range of consumer products. Across the group, Sappi is close to “pulp neutral”, meaning that the group sells almost asmuch pulp as it buys. The Sappi group has:• 13 064 employees in 20 countries• Sales in over 100 countries• Manufacturing operations on 3 continents• Paper production capacity of 5. 6 million tons per annum• Paper pulp production capacity of 3.7 million tons per annum• Dissolving wood pulp production capacity of 1.3 million tons

In FY2014:• Sappi North America accounted for 25% of sales• Sappi Europe accounted for 51% of sales• Sappi Southern Africa accounted for 24% of sales

F0.2

Please select the stages of the value chain which best represent your organization’s area of operation pertaining to forest risk commodities. If yourorganization is diversified or vertically integrated, please select all that apply

ProductionProcessingTradingManufacturing

F0.3

Are there any parts of your direct operations that are excluded from this disclosure?

No

F0.3a

Please identify the parts of your direct operations that are excluded from your disclosure

Exclusion Description of exclusion Potential for deforestation risk Please explain

F0.4

Are there any parts of your supply chain that are excluded from this disclosure?

No

F0.4a

Please identify the parts of your supply chain that are excluded from your disclosure

Exclusion Description of exclusion Potential for deforestation risk Please explain

F0.5

Do you produce or use materials that contain any of the forest risk commodities? Please complete the table

Forest risk commodity Produce/use forest risk commodity Explanation if not disclosing butproduce/use the commodity

Timber YesPalm OilSoyCattle ProductsOther No

F0.6

Please confirm which commodities you will be disclosing on

Timber

F0.7

Please state the start and end date of the year for which you are reporting data

Reporting year

Mon 30 Sep 2013 - Wed01 Oct 2014

Further Information

Module: Current State

Page: F1. Context

F1.1

How does your organization use your selected commodities? Please provide details on the form and source of the commodities you use or produce

Forest riskcommodity Activity Form of

commodity Source Source location% of

procurementspend

Comment

Timber

Growing/productionof rawmaterials

HardwoodlogsSawn timber,veneer, chipsFiberPulpPaperBoards,plywood,engineeredwoodPrimarypackagingBioenergy

OwnconcessionsSmallholdersMultiplecontractedproducers

AustraliaBrazilCanadaFranceRussian FederationUnited States of AmericaOther: Austria, Belarus, Belgium,Bosnia & Herzegovina, Croatia, CzechRepublic,Estonia, Germany, Finland,Denmark, Ireland, UK, Netherlands,Norway, Latvia, Lithuania, Poland,Ukraine, Romania, Hungary, Slovakia,Slovenia, Switzerland, Swaziland,South Africa, New Zealand, Germany,Finland, Sweden, Spain, Portugal,Chile.

21-30%

Sappi is vertically integrated into forestproducts, pulp and energy. In terms ofbio-energy, 54% of Sappi’s energy in itsmanufacturing operations is derived fromrenewable energy – sludges, biomassand black liquor. Black liquor, which isclassified as a biofuel, is the spentcooking liquor from the pulping processwhich arises when pulpwood is cooked ina digester thereby removing lignin,hemicellulose and other extractives fromthe wood to free the cellulose fibres. Theresulting black liquor is an aqueoussolution of lignin residues, hemicellulose,and the inorganic chemicals used in thepulping process. Black liquor containsslightly more than half of the energycontent of the wood fed into the digester.Globally, black liquor accounts for 68% ofthe renewable energy used in Sappi’soperations. (See page 93, 2014 GroupSustainability Report, available onwww.sappi.com)

F1.2

Please indicate the percentage of your organization’s revenue dependent on each of your selected forest risk commodities

Forest riskcommodity

% ofrevenue

dependenton

commodity

Comment

Timber 91-99%

Together with water and energy, woodfibre is one of Sappi’s key inputs. A constrained or reduced woodfibre source would havedramatic consequences for Sappi’s business. Sappi has identified investment in low-cost wood as both a growth driver and astrategic resource in order to supply its operations and to secure its margins in competitive commodity markets, such as dissolvingwood pulp. Another key area of investigation is nanocellulose; a new forest products material which we believe will play a role inSappi’s future suite of products, both as a product in itself and in its applications. Extracted from wood fibres, nanocellulose has anumber of unique optical, barrier and strength properties. Unlike other lightweight, high-strength materials based on fossil fuels, it iscompletely renewable, making it desirable as a new material for various industrial applications. Sappi has successfully developed alow cost, patented cellulose nanofibril (CNF) process in cooperation with a leading research institution. Grades produced will beoptimally suitable for application in lighter and stronger fibre-reinforced composites and plastics, food and pharmaceuticalapplications, and as rheology modifiers, as well as in barrier and other paper and coating applications. Sappi is planning theconstruction of a pilot production plant towards the end of 2015.

F1.3

Has your organization experienced impacts related to forest risk commodities that have generated a substantive change in your business operations,revenue or expenditure in the past five years?

Yes

F1.3a

Please identify the impacts related to forest risk commodities that have generated a substantive change in your business operations, revenue orexpenditure in the past five years


Impactdriver Impact Description of impact Financial

impactResponsestrategy Description of response strategy

TimberPhysical:Climatechange

Higheroperatingcosts

Climate change is impacting on theproductivity of forests and plantationsaround the world, while concerns aboutcarbon footprint are driving a movetowards increased use of woodfibre as afuel and building material. The SouthernAfrican landscape is prone to, andecologically adapted to, frequent fires.There is a high risk of uncontrolled firesentering and burning down significantareas of plantation.

Medium

Alignment ofpublic policypositions withsustainable forestmanagementgoalsStrengtheninglinks with localcommunityIncreasedinvestment in newtechnologyNew productdevelopmentand/or marketexpansionSustainable forestmanagementincentives

Drought and pest infestations arepotentially exacerbated by climate changeas well as changing the speciesdistribution. Sappi’s exposure to climatechange related risk in South Africa which isexpected to be more severely impacted byclimate change than any of the otherregions in which we operate, is moderatedby the diversity of commercial species andhybrids deployed across a wide range ofclimatic conditions. Sappi continuallymonitors and reviews forest best practicesin the light of changing environmentalfactors, thus helping to mitigate anyincreased threat from water shortages ordrought. The company’s mitigationactivities in this area include: •Maintainingwide genetic variability in planting material.This enables Sappi to breed trees for awide range of conditions and the rate ofchange in conditions is probably slowenough for the company to respond in thebreeding programme. In other words wewill produce better trees as conditionschange. •Measuring permanent sampleplots measured annually (eucalypts) or bi-annually (pines) to determine the effect ofdrought on current annual increment as aninput to long-term planning. •Implementingextensive planting of more drought-toleranteucalypt hybrids. •Engaging in researchand collaboration with industry and tertiaryinstitutions to develop bio control measuresand breed genetically more resistantplanting stock. Sappi has implementedextensive fire protection strategy throughwhich risks are now managed via anintegrated Fire Risk Management System.


Impactdriver Impact Description of impact Financial

impactResponsestrategy Description of response strategy

Sappi has increased communityparticipation in fire prevention to reduce theincidents of fires through regional anddistrict Fire Protection Associations. Inaddition, significant investment hasimproved fire detection, while fire crewtraining and improved equipment hassignificantly improved response times tofires.

F1.4

Please describe why you do not know if your organization experienced any impacts related to forest risk commodities that have generated a substantivechange in your business operations, revenue or expenditure in the past five years

Primary reason for being unaware of impacts Comment

Further Information

Module: Risk Assessment

Page: F2. Risk assessment

F2.1

Please select the option that best describes your procedures with regard to assessing deforestation risks and opportunities


Deforestation riskassessment procedure

Operationalcoverage Comment

Timber

Integrated into acomprehensive, company-wide risk assessmentprocess

DirectoperationsSupply chain

At a company (group) level, the Regional Risk Management Councils meet bi-annually to identify,assess and discuss risks. The top risks are then identified and plotted on a graph in terms oflikelihood and severity. Risks, including forest risks, are monitored and publicly reported onannually. We currently have a general process for determining materiality and priorities of allSappi’s risks. Forest risks considered include regulatory, reputational, weather related (fire andpests), forest management, operational resource management (water, energy), licence to operateand customer behavioural change. At asset (regional and operating unit e.g. mills) level, riskspertaining to that specific asset are assessed and mitigation actions are managed by themanagement team of that specific asset. The risks to assets are reviewed on a six-monthly basis bythe management team responsible for the asset and all major assets are covered by insurance. Onan annual basis, the risks associated with Sappi’s non-forestry assets are reviewed by externalconsultants. The results of these reviews are converted to mitigation action plans, if required. Theresults of these reviews are used together with the internal survey results of the company’s forestryassets, to buy insurance to mitigate risk as required.

F2.1a

Please provide further details on your risk assessment procedures with regard to deforestation risks and opportunities


Frequency ofmonitoring

To whom areresults reported?

Scale of riskassessment

How far intothe future are

risksconsidered?

Please explain

TimberSix-monthly ormorefrequently

Board or individual/sub-set of the Boardor committeeappointed by theBoard

Wholecompany 3-6 years

The Social, Ethics, Transformation and Sustainability (SETS) Committee,a statutory board committee, has final responsibility for climate change.The SETS committee has an independent role with accountability to theBoard. The role of the SETS Committee is to assist the Board with theoversight of sustainability issues within the company and to provideguidance to management’s work in respect of its duties in the fields ofsocial, ethics, sustainability and transformation. In each region whereSappi operates, climate change-related responsibilities form part of thefunction of the Regional Sustainability Councils (RSC) in North America,


Frequency ofmonitoring

To whom areresults reported?

Scale of riskassessment

How far intothe future are

risksconsidered?

Please explain

Europe and South Africa. These RSCs feed into the Global SustainabilityCouncil which in turn reports to the SETS Committee.

F2.1b

Please identify which of the following criteria are factored into your organization’s deforestation risk assessments

Criteria Timeframe Relevance Please explain

Changes in availabilityand quality of forest riskcommodities

Current Relevant,included

Fire: The winter of 2014 was the most difficult fire season in South Africa Iin recent years, with dry andabnormally warm weather prevalent in Sappi’s main forestry regions. A total of 2,575 hectares ofplantation were lost to fire in 2014, compared to an average of 626 hectares during the past five years.Sappi continues to invest in using modern identification, alarm and response technology, as well ascontinued engagement with the communities in and around our plantations. In addition, Sappi staff playkey roles in the provincial and local fire protection associations Pests and diseases: The plantationindustry in South Africa faces an increasing threat from pests and diseases. Sappi Forests is a leader inR&D, continuing to mitigate these risks through improved site species matching, the deployment ofimproved genetic planting stock and the introduction of specific hybrids from our conventional breedingprogrammes. The construction of the state-of- the-art Clan Nursery, with a capacity of 17 million cuttings(vegetatively propagated plants), was completed in September 2014, and provides Sappi Forests with therequired facilities to rapidly deploy the improved genetic planting stock to mitigate these threats.

Impact of activity on thestatus of ecosystemsand habitats


Neither Sappi's own plantations in South Africa nor the managed natural forests in Europe and NorthAmerica from which the group sources woodfibre would be productive without biotic processes takingplace. These processes play a vital role in ensuring the health and vitality of trees in terms ofdecomposition, soil rejuvenation and pest control. Both Sappi's own plantations and the third-party forestswhich provide the group with woodfibre are actively managed to enhance these beneficial bioticprocesses and restrict harmful processes like pests and disease. Sappi measures its ecosytem andbiodiversity management standards against the internationally accredited forest certification systems ituses (FSC®, PEFC™ and SFI) These certification systems incorporate detailed criteria for biodiversityand ecosystem management including: • Water and soil • Wildlife and game management • Use of

Criteria Timeframe Relevance Please explain

pesticides and chemicals; • Forest conversion • Protection of valuable habitats and threatened species.In South Africa, one third of our landholdings are managed for biodiversity conservation.

RegulationTariffs or priceincreasesLoss of marketsStakeholder conflictsconcerning forest riskcommodities

Brand damage relatedto forest riskcommodities


Many consumers erroneously equate deforestation with pulp and paper companies like Sappi. This ismitigated by responsible sourcing activities: The percentage of certified fibre procured for Sappi’s mills ineach region is as follows: South Africa: 82%, Europe: 74.1%, North America: 66%. The balance isprocured from known and controlled sources. In South Africa and North America, Sappi works withlandowners to increase certification. In South Africa, 100% of Sappi’s owned and leased plantations areFSC-certified.

Other

F2.1c

Please provide any additional information about your approach to assessing deforestation risks here

F2.1d

If you have conducted a partial risk assessment, please identify any exclusions in the following table

Forest risk commodity Exclusion Please explain

F2.2

Please explain why you do not have a process in place for assessing and managing deforestation risks, and whether you plan to introduce such aprocess in the future

Forest risk commodity Primary reason for nothaving a process

Do you plan to introducea process? Timeframe Comment

Further Information

Module: Implications

Page: F3. Risks

F3.1

Have you identified any inherent risks related to producing, marketing or sourcing forest risk commodities that have the potential to generate asubstantive change in your business operations, revenue or expenditure? Please select all that apply

Forest riskcommodity Risk

Timber

Operational risks driven bychanges in physicalparametersRisks driven by changes inregulationReputational risks

F3.1a

For your selected forest risk commodities, please describe any inherent operational risks in your direct operations or supply chain driven by changes inphysical parameters that have the potential to generate a substantive change in business operations, revenue or expenditure


Riskdriver

Geographicalscale Description of risk Potential

impact TimeframeDirect

operations/supplychain

Likelihood Magnitudeof impact Management methods

TimberLoss ofecosystemservices

Global

There is a risk thatclimate change couldimpact thebiodiversity andecosystems servicesof the foresst andplantations fromwhich Sappi sourceswoodfibre.Biodiversity isparticularly importantfor Sappi. NeitherSappi's ownplantations in SouthAfrica nor themanaged naturalforests in Europe andNorth America fromwhich the groupsource woodfibrewould be productivewithout bioticprocesses takingplace

Inabilityto dobusiness

Up to 1year

Directoperationsand supplychain

More likelythan not

Medium-high

Both Sappi’s ownplantations and thethird-party forests fromwhich the groupsources woodfibre areactively managed toenhance beneficialbiotic processes andrestrict harmfulprocesseslike pestsand disease. Forestmanagement can oftenaccelerate the growthof timber, resulting intrees becomingavailable for harvestingat shorter intervals, ieallowing more frequentharvesting. Whenforests are leftunmanaged, crowncanopies closee standsbecome denser,creating competitionamongst the trees forresources like sunlight,water, and nutrients.Unmanaged forestscan lead to greater riskof pest infestation andforest fire. Whenpreviously unmanagedstands undergo forest


Riskdriver





management, room iscreated for theremaining trees to growdue to reducedcompetition forresources, resulting inthe remaining treesincreasing their girthuntil the crown canopygrows closed again.Climate change canpotentially impact thehealth and vitality offorests and plantations.Drought and pestinfestations arepotentially exacerbatedby climate change aswell as changing thespecies distribution.Sappi’s exposure toclimate change relatedrisk in South Africawhich is expected to bemore severelyimpacted by climatechange than any of theother regions in whichthe group operates, ismoderated by thediversity of commercialspecies and hybridsdeployed across a widerange of climaticconditions. Sappicontinually monitors


Riskdriver





and reviews forest bestpractices in the light ofchangingenvironmental factors,thus helping to mitigateany increased threatfrom water shortages ordrought. Thecompany’s mitigationactivities in this areainclude: •Maintainingwide genetic variabilityin planting material.This enables Sappi tobreed trees for a widerange of conditions andthe rate of change inconditions is probablyslow enough for thecompany to respond inthe breedingprogramme. In otherwords Sappi willproduce better trees asconditions change.•Measuring permanentsample plots measuredannually (eucalypts) orbi-annually (pines) todetermine the effect ofdrought on currentannual increment as aninput to long-termplanning.•Implementingextensive planting of


Riskdriver





more drought-toleranteucalypt hybrids.•Engaging in researchand collaboration withindustry and tertiaryinstitutions to developbio control measuresand breed geneticallymore resistant plantingstock.

F3.1b

For your selected forest risk commodities, please describe any inherent risks in your direct operations or supply chain driven by changes in regulationthat have the potential to generate a substantive change in business operations, revenue or expenditure


Riskdriver




Likelihood Magnitudeof impact

Managementmethods

Timber Nationallegislation Region

In North America andEurope, the politicalpreference to usetimber for energyrather than materialuse poses a risk toSappi's raw materialavailability. In NorthAmerica, theregulations with

IncreasedoperationalcostReduction/disruptioninproductioncapacityReduction/disruption

Up to 1year


Likely Medium-high

Sappi is lobbyingthrough the industrybodies in eachregion.IN terms ofburning biomass, astudy shows that thewealth creation in thepulp and paperindustry value chain ismainly market driven


Riskdriver





Managementmethods

which Sappi is havingto contend includestate and federalRenewable ElectricityStandards, climatepolicies, and theRenewable FuelStandard. In Europe,the RenewableEnergy Directive setsbinding targets forEU Member States.To reach thesebinding renewableenergy targets,member states haveput in place financialincentives (e.g. greencertificates or feed-intariffs). The supportfor the direct burningof wood to createrenewable energyincreases pressureon wood markets. InSouth Africa,governmentrestrictions onafforestation .

of supplyInability todobusiness

and five times that ofthe energy alternative(and provides seventimes more jobs. InSouth Africa Sappiworks with localgovernment andcommunities toaccelerateafforestation in thenorthern region of theEastern Cape. Thisallows Sappi to securevaluable hardwoodtimber resources closeto Saiccor Mill inKwaZulu-Natal. Inaddition to Sappi’sown plantation area,the companycontinues to identifyways to ensure accessto pulpwood in thewood baskets close tokey operations, bymeans of land ortimber delivery swaps.

F3.1c

For your selected forest risk commodities, please describe any inherent reputational risks in your direct operations or supply chain that have thepotential to generate a substantive change in business operations, revenue or expenditure

Forest riskcommodity Risk driver Geographical

scale Description of risk Potentialimpact Timeframe

Directoperations/

supplychain


Managementmethods

TimberUncertaintyin marketsignals

Global

Trends inadvertising,electronic datatransmission and –storage, as well asthe internet, couldhave adverseeffects ontraditional printmedia and otherpaper applications,including Sappi’sproducts and thoseof its customers.Advertisingexpenditure hasgradually shiftedaway from themore traditionalforms of advertising(newspapers,magazines, radioand television)which tend to bemore expensive,toward a greateruse of electronicand digital forms ofadvertising (theinternet, mobilephones and otherelectronic devices),

Reduceddemand forgoods/service

Up to 1year


Likely High

Sappi’s strategyincludes seekinggrowth opportunitiesby producinginnovativeperformancematerials fromrenewableresources.Accordingly, thegroup’s treeimprovementresearch focuses onimprovingsustainable supply ofwood fibre. Sappi’sannouncement in2015 that it would bebuilding a pilot-scaleplant for low-costCellulose NanoFibrils(nanocellulose orCNF). Productsproduced usingSappi’s CNF will beoptimally suitable forconversion in lighterand stronger fibre-reinforcedcomposites andplastics, in food andpharmaceuticalapplications, and in

Forest riskcommodity Risk driver Geographical

scale Description of risk Potentialimpact Timeframe

Directoperations/

supplychain


Managementmethods

which tend to beless expensive.

rheology modifiers aswell as in barrier andother paper andcoating applications.Lightweight productsare important in viewof the impact onclimate oftransporting heavierproducts. Inaddition, Sappibelieves that climateand food securityrisks will affect cottonavailability in thefuture. As dissolvingwood pulp (DWP) isa raw material usedin the manufacture ofviscose, a directcompetitor to cotton,the group hasidentified dissolvingwood pulp (DWP) asa high growth, highmargin business ofthe future. In 2013,the groupsuccessfullycommissioned twoprojects to expandDWP capacity from800 000tpa to 1,34mtpa.

F3.2

If you indicated in question F3.1 that you do not consider your organization to be exposed to operational risks related to producing, marketing orsourcing any of your selected commodities, please explain why in the table below

Forest risk commodity Primary reason for not identifying risks Comment

F3.3

If you indicated in question F3.1 that you do not consider your organization to be exposed to risks related to producing, marketing or sourcing any ofyour selected commodities driven by changes in regulation, please explain why in the table below


F3.4

If you indicated in question F3.1 that you do not consider your organization to be exposed to reputational risks related to producing, marketing orsourcing any of your selected commodities, please explain why in the table below


Further Information

Page: F4. Opportunities

F4.1

Have you identified any opportunities related to producing, marketing or sourcing these commodities sustainably that have the potential to benefit yourorganization?

Forest risk commodity Opportunities?

Timber Yes

F4.1a

Please describe the opportunities related to producing, marketing or sourcing these commodities sustainably, and your organization’s strategy tocapitalize on them

Forest riskcommodity Opportunity Scale of opportunity Strategy to realize

opportunity Timeframe Comment

TimberIncreasedshareholdervalue

Sappi has identified dissolving wood pulp(DWP) as a high growth, high marginbusiness of the future. Sappi’s DWP issold globally for use in textiles, including: •Viscose staple fibres (VSF) or rayon — mostof Sappi’s DWP is sold into this segment •Solvent spun fibres (lyocell). Based onglobal GDP and population growthexpectations and increasing affluence,particularly in Asia, Sappi is remainconfident in this market segment and itscontinued growth. Cellulosic-based fibreshave the following advantages: Breathabilityproperties Unlike petroleum-based fabrics,fabrics made from cellulosic fibres breatheand are comfortable to wear. Substitution ofcompeting fibres Derived from woodfibregrown in sustainably managed forests and

In 2013, the groupsuccessfullycommissioned twoprojects to expandDWP capacity from800 000tpa to 1,34mtpa.

Last 3-6years

Combined, Sappi's three DWP mills, on twocontinents, can produce 1.34 million tonsper annum (tpa) — approximately 18% ofthe world’s total demand. South AfricaSaiccor Mill: 800,000tpa sulphite DWPcapacity. Acquired by Sappi in 1989, thismill has been manufacturing DWP since1955. Ngodwana Mill: 210,000tpa kraftDWP capacity since 2013. North AmericaCloquet Mill: 330,000tpa Kraft DWPcapacity since 2013; can switch betweenDWP and paper.

Forest riskcommodity Opportunity Scale of opportunity Strategy to realize

opportunity Timeframe Comment

plantations, VSF has a sustainable futurecompared to fibres produced from finiteresources, like fossil fuels. In manyapplications VSF is also a substitute forcotton which is highly dependent on theavailability of arable land and susceptible tocapricious weather conditions.Environmental considerations Unlike manyother crops, the sustainably managedplantations and forests from which Sappisources woodfibre are not irrigated andSappi’s minimal use of pesticides is strictlycontrolled by the forest certification systemsto which the group conforms. In addition,woodfibre yields 2-3 times more cellulosethan cotton per hectare.

F4.2

Please explain why you do not consider there to be any opportunities for your organization associated with producing, marketing or sourcing thesecommodities sustainably

Forest risk commodity Primary reason for not identifying opportunities Comment

F4.3

Please explain why you don’t know if there are any opportunities for your organization associated with producing, marketing or sourcing thesecommodities sustainably

Forest risk commodity Primary reason for not knowing if there are opportunities Comment

Further Information

Module: Measure & Monitor

Page: F5. Measurement

F5.1

Do you own or manage land used for the production of any of your selected commodities? Please complete the table


Ownand/or

manageland?

Size(Hectares)

Type ofcontrol

System inplace tomonitor

deforestation?

Recentinfractions? Comment

TimberOwn andmanageland

450,000-500,000 Operational Yes No

Sappi owns and manages 495 000ha of land in South Africa, whereabout 0,5% of the total land area is covered by natural forests.[http://www.gov.za/about-sa/forestry] Plantations cover approximately1% of South Africa’s land area and plantation forestry is a priority areafor the government, as it drives development in rural areas. Historically,plantation forests have replaced grassland, rather than natural forests.In the other areas where Sappi has manufacturing operations, ie Europeand North America, forests are growing. Europe’s net forest area iscurrently increasing at a rate of approximately 1.6 million hectares perannum. [Source: Confederation of European Paper Industries] In theUnited States, more trees are grown than harvested. The countrycontinues to benefit from a large and diverse forest inventory distributedacross about one-third of total land area. Over the last six decades, thetotal net United States forest area has increased by over 3%.[http://www.za.twosides.info/US/Thirty-Leading-North-American-Companies-Remove-Go-Paperless--Save-Trees-Claims]

F5.2

Does your organization collect production and/or consumption data for your selected commodities?

Forest risk commodity Production and/or consumption data available?

Timber Data available, but not disclosing

F5.2a

Please disclose your production and/or consumption data using the table below


Production/consumption data Volume Metric Full/Partial data? If partial data, please

explain

F5.3

Please explain why your organization is not disclosing production and/or consumption data for your selected commodities

Forest risk commodity Primary reason for not disclosing production/consumption data Comment

Timber Data considered confidential

F5.4

Please explain why production and/or consumption data is not available for your selected commodities

Forest risk commodity Primary reason for not having production/consumption data Comment

Further Information

Sales volumes pages 76 – 77 2014 IAR

Attachments

https://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F5.Measurement/sappi 2014 iar.pdf

Page: F6. Traceability

F6.1

Do you have a system in place to track and monitor the origin of raw materials for your selected commodities?

Forest risk commodity System to track and monitor origin of raw materials?

Timber Yes

F6.1a

Please describe the system you have in place to track and monitor the origin of raw materials for your selected commodities

Forest riskcommodity System System

coverageIf partial, % of total

production/consumptiontracked/monitored

Please explain

TimberControlSystem

Full

For NA operations, the origin of the fibre is recorded at the time of receipt. A portion ofthis supply is subsequently inspected at the source, as selected by sampling designprocedures, for compliance with rules, regulations and accepted good forestry practices.In SA and EU, Sappi uses a system called Timber Control System which identifiesaspects such as location of origin, age and species etc and operates according to(FSC®), SFI®, PEFC chain of custody requirements which stipulate reporting on speciesand countries forest origin

F6.2

Please explain why you do not have a system in place to track and monitor the origin of raw materials for your selected commodities

Forest risk commodity Primary reason for not having a system in place Comment

F6.3

Please provide details on the level of traceability your organization has for your selected commodities


% of totalproduction/

consumptiontraceable

Traceability systemPoint towhich

traceableExclusions

Exclusiondescription,if applicable

Comment

Timber 100%

For NA operations, the origin of the fibre is recorded atthe time of receipt. A portion of this supply issubsequently inspected at the source, as selected bysampling design procedures, for compliance with rules,

CountryNotapplicable

All Sappi’s products aresold with a Chain ofCustody claim, whichpasses along an assurance



consumptiontraceable

Traceability systemPoint towhich

traceableExclusions

Exclusiondescription,if applicable

Comment

regulations and accepted good forestry practices. In SASappi uses FSC chain of custody certification –traceability managed through the company’s TimberControl System and bar code labels on the timber. EU:Depends on the type of wood source. For round woodsourced directly Sappi can identify the stand from whichthe material originates. If sourced via traders or woodchips from saw mills the regions from which the materialoriginates are also known.

of sourcing from well-managed forests and/orplantations.

F6.3a

Please describe your organization’s approach to establishing traceability

Sappi works through forest certification systems such as FSC, PEFC and SFI.

Further Information

Module: Response

Page: F7. Governance and strategy

F7.1

Please indicate where the highest level of direct responsibility for deforestation risk lies within your organization and detail the frequency and nature ofengagement on the issue

Highest level ofresponsibility

Name/position ofindividual or name of

committeeFrequencyof briefing Nature of engagement

Board or individual/sub-setof the Board or committeeappointed by the Board

Social EthicsTransformation andSustainabilityCommittee

Bi-annually

The Social, Ethics, Transformation and Sustainability (SETS) Committee, a statutory boardcommittee, has final responsibility for climate change. The SETS committee has anindependent role with accountability to the Board. The role of the SETS Committee is toassist the Board with the oversight of sustainability issues within the company and toprovide guidance to management’s work in respect of its duties in the fields of social,ethics, sustainability and transformation. In each region where Sappi operates, climatechange-related responsibilities form part of the function of the Regional SustainabilityCouncils (RSC) in North America, Europe and South Africa. These RSCs feed into theGlobal Sustainability Council which in turn reports to the SETS Committee.

F7.2

Have you evaluated how the availability or quality of forest risk commodities could affect your organization’s growth strategy?

Yes, evaluated over the next 5 years

F7.2a

Please explain how you evaluated the effects of the availability or quality of forest risk commodities on the success (viability, constraints) of yourorganization’s growth strategy

Sappi’s strategy encompasses three broad themes:

Growing Sappi’s existing high margin businesses by increasing its customer base and product portfolios inSappi’s three key business areas:

- Specialised cellulose- Packaging- Speciality paper• Optimising and improving the profitability of the mature graphic paper business.• Developing complementary industrial products and processes.

Sappi’s plantation assets are a growth pillar of the company’s strategy. Forest research is being conducted into species improvement in order to maximise yieldunder different climate change scenarios. Trees use water and sunlight to convert CO2 into carbohydrates, through the process of photosynthesis to provide energy

and the building blocks for growth. Carbon removed from the atmosphere is effectively stored in plant material and wood, i.e. trees act as carbon sinks. Consumerconcerns about global warming have given us the opportunity to develop and market ‘green’ products.

F7.3

Please explain why you have not evaluated how the availability or quality of forest risk commodities could affect the success (viability, constraints) ofyour organization’s growth strategy

Primary reason for not evaluating potential impact on growth strategy Comment

Further Information

Page: F8. Policies

F8.1

Do you have a company policy that recognizes the role of deforestation in climate change mitigation?

Policy Comment

Yes, a publiclyavailablecompany-widepolicy

Sappi’s Group Climate Change Policy states: “As reducing deforestation of the world’s endangered and tropical forests can help to reduceglobal warming, we commit to: • Utilising wood fibre from 100% sustainably managed forests and plantations in accordance with our GroupWood Procurement Policy – healthy productive forests absorb carbon dioxide, thereby helping to mitigate global warming • Collaborating inresearch and development programmes to address the challenges of climate change • Improving our forestry operations through tree breedingthat allows for greater yields per hectare, reduces the risks from pests and diseases, and improves drought tolerance • Promoting the recyclingof paper and paper packaging products.” The policy is available at:http://www.sappi.com/group/Sustainability/Sappi%20Climate%20Change%20Policy_Web.pdf

F8.2

Has your organization made a commitment to reduce or remove deforestation and forest degradation from your direct operations and/or supply chain?

Yes

F8.2a

Please identify which of the following criteria are specifically stated in your organization’s commitment to reduce or remove deforestation and forestdegradation from your direct operations and/or supply chain

Criteria Commoditycoverage

Operationalcoverage


consumptioncovered by

commitment

Commitmenttimeframe Please explain

Zerodeforestationand forestdegradationHighConservationValue (HCV)managementCertificationAvoidance ofCITES listedspeciesAvoidance ofIUCN Red Listof ThreatenedSpecies

TimberDirectoperationsand supplychain

100% No timeframe

The Group Wood Procurement Policy states •As stakeholders in managedforests, we have a responsibility to ensure the sustainability of the world’sforest resources through our procurement practices We will only sourcewoodfibre that: •Comes from forests where the customary, traditional or civilrights of any people are upheld •Is not sourced from any indigenous forest orwoodland or any other area that has high conservation values which arethreatened by forestry activities •Does not come from plantations which havebeen converted from natural forestshttp://www.sappi.com/group/Sustainability/Policies/Sappi-Group-Wood-and-Fibre-Procurement-Policy.pdf The Group Sustainability Charter sets Sappi’scommitment to “promoting sustainable forestry through internationallyaccredited independent environmental management and forest certificationsystems”. http://www.sappi.com/group/Sustainability/Policies/Sappi-Group-Sustainability-Charter.pdf

F8.3

Please explain why your organization has not made a commitment to reduce or remove deforestation and forest degradation from your direct operationsand/or supply chain, and whether you plan to do this in the future

Primary reason for not having made a commitment Do you plan to introduce a commitment? Comment

F8.4

Do you have commodity specific sustainability policies?


Commodityspecific

sustainabilitypolicies?

CriteriaCut-offdate, if

applicablePlease explain

Timber Yes

Zerodeforestation andforestdegradationHighConservationValue (HCV)managementAvoidance ofland area underconservationLegalityCertificationAvoidance ofCITES listedspeciesAvoidance ofIUCN Red List ofThreatenedSpecies

Notapplicable

The Sappi Group Wood Procurement Policy states •As stakeholders in managed forests, wehave a responsibility to ensure the sustainability of the world’s forest resources through ourprocurement practices We will only source woodfibre that: •Comes from forests where thecustomary, traditional or civil rights of any people are upheld •Is not sourced from anyindigenous forest or woodland or any other area that has high conservation valueswhich are threatened by forestry activities • Does not come from plantationswhich have been converted from natural forestshttp://www.sappi.com/group/Sustainability/Policies/Sappi-Group-Wood-and-Fibre-Procurement-Policy.pdf

Further Information

Attachments

https://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F8.Policies/Sappi-Group-Supplier-Policy.pdfhttps://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F8.Policies/Sappi-Group-Climate-Change-Policy.pdfhttps://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F8.Policies/Sappi-Group-Sustainability-Charter.pdf

Page: F9. Standards and targets

F9.1

Do you have any environmental standards for the production of raw materials for your selected commodities, other than third party certificationschemes?


Productionstandardsin place?

Please describeyour production

standardsComment

Timber Yes

Uncertified fibre(wood and pulp) issourced from knownand trusted suppliersclose to each mill,regularly visited bySappi's buyers.FSC®-controlledwood and PEFC™Due DiligenceSystems (DDS)requirements areincorporated intoSappi’s purchasingspecifications andcontracts which align

The Group Wood Procurement Policy stipulates that Sappi monitors the origin of wood fibre and pulp. isavailable under the sustainability tab at www.sappi.comhttp://www.sappi.com/regions/sa/Sustainability/Documents/Sappi%20Group% The Group Supplier Policyhighlights the fact that Sappi prefers to work with suppliers who share the group’s commitment to sustainabledevelopmenthttp://www.sappi.com/regions/sa/Sustainability/Documents/Sappi%20Group%20Supplier%20Policy.pdf


Productionstandardsin place?

Please describeyour production

standardsComment

with the group’spurchasing policy. InNorth America whena supplier providesnon-certified butControlled Wood,internal proceduresare used to verify thestatus of the wood.This process isreviewed annually bythird party auditorswho provide thenecessaryverification

F9.2

Does your organization enforce any procurement standards that impact your sourcing of forest risk commodities?


Procurementstandards in

place?Monitor

compliance?Impact onsourcingactivities

Comment

Timber Yes Yes

Factored intosupplier selectionprocessImpact onsupplierengagementstrategy

In addition to Sappi’s internal woodfibre certification efforts, the group promotes certificationamongst its suppliers and outside its own operations. SNA's ongoing forest managementservices and supplier outreach programmes help to increase certified lands in areas thatsupply fibre to its mills. SNA was the first pulp and paper company In NA to be granted agroup forest management certificate by the FSC®. Small landowners who agree to becomea member of SNA's forest management group have their land certified in accordance to theFSC® standard under this certificate. SNA's Sustainable Forestry Programme assists


Procurementstandards in

place?Monitor

compliance?Impact onsourcingactivities

Comment

woodlot owners in the State of Maine to develop plans for managing and harvestingwoodlands.

F9.3

Are you involved in any multi-partnership or stakeholder initiatives relating to the sustainability of these commodities? Please describe your role


Involved ininitiatives? Initiatives Please explain

Timber Yes

FSCSustainable ForestryInitiative (SFI)Other: EUCAGEN,CAMCORE, ForestProducts WorkingGroup

SSA has established a group scheme for small and medium growers. There are currently more than 60members in the scheme with plantations ranging from a few hundred hectares to well over 10,000ha insize. FSC® certification is not yet available to micro growers; largely because of administrative andfinancial constraints. Under the auspices of Forestry South Africa, SSA is evaluating ways of overcomingthese barriers; it may take another two years to be established. Presently, timber from micro growers isrecognised as Controlled Wood and can thus be used to produce FSC®- certified products labelled as‘mixed sources’. To promote and incentivise certification throughout South Africa, SSA currently pays apremium for FSC®-certified timber. Sappi has been a signatory to the UN Global Compact since 2008.Our commitment to Principle 7: Support a precautionary approach to environmental challenges andPrinciple 8: Undertake initiatives to promote greater environmental responsibility are detailed in Sappi’s2014 Group Sustainability Report, pages 119 - 120 Sappi is a member of CAMCORE, an international,non-profit organisation dedicated to the conservation and utilisation of subtropical and tropical treespecies. Several of these conservation parks are conserving species/populations (ex situ) that arethreatened or severely endangered within their native habitat. Sappi is a member of EUCAGEN whichaims to facilitate the development of genomic resources for Eucalyptus tree species.The sequencing ofthe genome was completed at the end of 2009 and the first assembly (alignment of the genome) andannotation (attaching biological information to the sequences) of all the genes for the Eucalyptus grandisgenome has been completed and released. SNA is a founding member of the Forest Products WorkingGroup (FPWG). The Group’s inaugural project designed a set of guidelines to aid the responsibleprocurement, use and recovery, of paper products. Project work is underway to identify and address someof the barriers to expanding the growth of certified forests.

F9.4

Do you specify any third party certification schemes for your selected commodities? Please indicate the percentage of total production and/orconsumption currently certified

Forest RiskCommodity

Specifycertificationschemes?


consumptioncertified

Certification breakdown Please explain

Timber

FSCPEFCSFI 100%

FSC ForestManagementcertificationFSC Chain ofCustodyFSC ControlledWoodFSC GroupcertificationPEFC SustainableForest ManagementcertificationPEFC Chain ofCustodySFI ForestManagementcertificationSFI Chain ofCustodySFI Fiber Sourcingcertification

In North America, 100% of wood and pulp is purchased in accordance with both theFSC® Controlled Wood standard and the SFI® Certified Sourcing standard. Thesestandards are a critical element of Sappi’s due diligence for Lacey Act compliance. InNorth America, Sappi includes fibre sourced from Certified Logging Professional and theMaine Master Logger programmes. SNA was the first pulp and paper company in NorthAmerica to be granted a group forest management certificate by the Forest StewardshipCouncil®. Through this certificate, small landowners who agree to enter as a member ofSappi’s forest management group have their land certified in accordance to the FSC®standard. In Europe, all mills in Europe FSC and PEFC certified. In South Africa,100% of Sappi’s owned and managed plantations are FSC-CoC certified, while Enstra,Ngodwana, Saiccor, Stanger, Tugela and Lomati Sawmill are FSC CoC certified.

F9.5

Do you have any quantified targets for third party certified materials in your direct operations and/or supply chains?


Quantifiedtargets for third

partycertification?

Certificationscheme

breakdownBaseline

yearTargetyear Coverage

% ofmaterialsthird partycertifiedin target

year

Comment

Timber

FSCPEFCSFIAmerican ForestFoundation TreeFarm System

FSC ForestManagementcertificationFSC Chain ofCustodyFSC ControlledWoodFSC GroupcertificationFSC SMLIF(small or low-intensitymanaged forest)PEFCSustainableForestManagementcertificationPEFC Chain ofCustodyPEFC GroupcertificationSFI ForestManagementcertificationSFI Chain ofCustody

Directoperations 61-70%

SEU target: Maintain a high level of certified fibredelivered to our mills (FSC® or PEFC™ certified, orequivalent). SEU’s 2014 target was >70%, the regionachieved 74.1% in 2014. 2015 target is >70%. SNA’starget is to increase the level of certified fibre across alloperations to 65% by 2016. This meant that the 2014target was 62%, 66% was achieved. The region's targetfor 2015 is 65%. SNA’s performance against the annualtarget is measured as a percentage of certified fibre (fromboth the pulp produced and bought pulp) in all itsproducts across all three manufacturing sites and all threebusiness units.. These targets are reported on publicly onan annual basis – see page 10 Sappi 2014 SDR SSAdoes not have certification targets as 100% of owned andmanaged land is FSC- certified. However, SSA hasrecently introduced a sustainable cut target in terms whichsets out an annual growth of greater than 4 million tonsper annum. SSA will publicly report against this target inFY2015. 82% of the fibre procured by SSA is FSC-certified, the rest is procured from known and controlledsources.

F9.6

Do you have any quantified targets for sustainable production and/or procurement, other than third party certification?


Quantifiedtargets for

sustainableproduction/

procurement?

Type oftarget

Baselineyear

Targetyear Coverage

% of materialsto meet

requirementsin target year

Comment

Timber Yes Sustainableproduction

Directoperations

SEU: Reduction of specific direct fossil CO2 emissions,including purchased power emissions (calculated at400g/KWh) by 5% by 2017 (base year 2012, saleableproduction) Reduction of specific water use (m³/tonmanufactured pulp and saleable paper) by 5% by 2017(base year is 2012, saleable production) SNA: Reduce theamount of total energy expended in making each ton ofproduct by 10% by 2016. Reduce paper mill raw materialwaste by 10% by 2016 Reduce pulp mill raw materialwaste by 10% by 2016 SSA: Achieve 15% reduction inspecific purchased fossil energy with 2000 as a base yearReduce total specific fresh water usage by 10% with 2007as a base year

Further Information

In questions 9.5 and 9.6 it is not possible to give numeric data for baseline and target years, as these vary according to region. Targets are detailed on page 10 ofthe 2014 Sustainability Report (attached)

Attachments

https://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F9.Standardsandtargets/sappi 2014 sdr.pdf

Page: F10. Engagement

F10.1

Have you identified sufficient sources of sustainable materials to meet your operational needs? Please explain what you are doing to ensuresecurity/continuity of supply


Currentdemand

Futuredemand

Actions to ensuresecurity/ continuity

of supplyPlease explain

Timber Yes Yes

Supplier improvementplans to increasecapacity of supply

South Africa: Encouraging entry into the industry and helping to develop tree farmers consolidatesthe industry and aligns with the South African government’s focus on rural development. In 1983,SSA launched Project Grow, a tree-farming scheme that gives subsistence farmers theopportunity to participate in the forestry industry, creating sustainable livelihoods in rural areas,fostering economic growth and entrepreneurship Project Grow currently involves more than 5,065growers, farming just over 22,300 hectares. These growers range from small individual growers tolarger community projects. Sappi recently expanded Project Grow beyond the borders ofKwaZulu-Natal province to the Eastern Cape. In 2014, Project Grow farmers supplied Sappi with11% of its hardwood fibre intake, valued at ZAR169 million. In addition, Sappi is working withcommunities in the Eastern Cape to help them obtain water-use licences for the establishment ofnew plantations. To date, Sappi has assisted several communities in the Eastern Cape in obtaininga total of 7,654ha of water-use licences, including 3,108ha of new licences awarded duringFY2014. Sappi is active in the land reform area and is assisting several land reform beneficiaries(communities) the management of their plantations, and has signed supply agreements with 34land reform/restitution projects totalling 4,710ha planted. In 2014, SSA continued with its world-leading tree improvement programmes to breed for specific pulping characteristics and enhancedyields. Fire management in SA Is also an ongoing focus area. Europe and North America: In bothnorthern hemisphere regions, Sappi mitigates fibre supply risk through a combination ofapproaches which include both short– and long-term wood supply agreements and shareholdingsin wood sourcing cooperatives. In 2013, SEU established a joint venture with SCA HygieneProducts called proNARO. The joint venture focuses on the wood sourcing process of pulpoperations in Alfeld, Stockstadt, Mannheim and Ehingen. This move has secured wood supply on along-term basis for pulp production in a cost efficient, sustainable manner.

F10.2

Are you working with smallholders to encourage and support sustainable forest management practices?


Working withsmallholders? Please explain

Timber Working withsmallholders

SSA employs 20 qualified extension officers and two managers who assist participants in Project Grow in in selecting themost appropriate areas for planting trees, avoiding environmentally sensitive areas. The extension officers also offer adviceand assist in preparing, fertilising and planting. They visit the growers frequently after the trees have been established toprovide assistance with weed control and the preparation of fire breaks. If requested, Sappi participates in growers’negotiations with contractors (especially harvesting and long-haul transport contractors) to ensure that growers are treatedfairly

F10.3

Are you working with your direct suppliers to support and improve their capacity to supply sustainable materials?


Working with directsuppliers?

Supplier engagementstrategy Comment

Timber Yes

Encouraging certificationEncouraging work withmulti-stakeholder groups

In North America Sappi’s ongoing forest management services and supplier outreachprogrammes to help increase certified lands in the areas that supply fibre to thecompany’s mills

F10.4

Are you working beyond the first tier of your supply chain to manage and mitigate risk?


Workbeyond

firsttier ofsupplychain?

Please explain

Timber Yes

In the case of secondary purchases through brokers or suppliers, the point of origin of the fibre (landowner) is generally, but not always,identified. A process to substantiate these claims is in place. In terms of non-certified fibre, wood/pulp is sourced from known andtrusted suppliers close to each mill, regularly risk assessed by competent experts. FSC®-controlled wood and PEFC Due DiligenceSystems (DDS) requirements are incorporated into our purchasing specifications and contracts. Environmental- and forestry-relatedinformation (including wood sources) is obtained from every pulp supplier on a regular basis and this data is then evaluated by a team ofexperts. In North America, in cases where a supplier is providing non-certified but Controlled Wood, internal procedures are used toverify the status of the wood. This process is annually reviewed by third party auditors who provide the necessary verification. In SouthAfrica, Sappi does not have sub suppliers. In South Africa, under the auspices of Forestry South Africa, Sappi is working with FSC totest a number of approaches to certification to see if micro growers can be assessed in a different way to the current approach used bythe FSC®. The project is scheduled to take three years to be completed. Sappi is currently in the 2nd year of research. In SouthAfrica, Sappi has established an FSC® group scheme for small and medium growers. In North America, Sappi is a founding member ofthe Forest Products Working Group. For its inaugural project, the group designed a set of guidelines to aid the respon-sibleprocurement, use and recovery of paper products. Co-chaired by Sappi’s Director of Sustainability, project work is under way with theFPWG to identify and address some of the barriers to expanding the growth of certified forests. Sappi North America was the first pulpand paper company in North America to be granted a group forest management certificate by the FSC®. Through this certificate, smalllandowners who agree to enter as a member of Sappi’s forest management group have their land certified in accordance to the FSC®standard.

F10.5

Do you engage in activities that could either directly or indirectly influence the market for sustainable forest risk commodities?

Activity Please explain

Increasing demand for sustainable materialsIncreasing awareness of sustainable materialsRaising awareness of the issue of deforestationEngaging with policy makers or governmentsOther: In the case of secondary purchases through brokers or suppliers, the

In all regions, Sappi participates in initiatives such as TwoSides which highlightthe message that Sappi’s products are reusable, recyclable, and come fromtrees that are sustainably harvested. Sappi raises awareness of sustainablematerials through marketing material and through brochures and a series ofFAQs published on www.sappi.com Through the industry groups to which we

Activity Please explain

point of origin of the fibre (landowner) is generally, but not always, identified. Aprocess to substantiate these claims is in place. In terms of non-certified fibre,wood/pulp is sourced from known and trusted suppliers close to each mill,regularly risk assessed by competent experts. FSC®-controlled wood andPEFC Due Diligence Systems (DDS) requirements are incorporated into ourpurchasing specifications and contracts. Environmental- and forestry-relatedinformation (including wood sources) is obtained from every pulp supplier on aregular basis and this data is then evaluated by a team of experts. In NorthAmerica, in cases where a supplier is providing non-certified but ControlledWood, internal procedures are used to verify the status of the wood. Thisprocess is annually reviewed by third party auditors who provide the necessaryverification. In South Africa, Sappi does not have sub suppliers. In SouthAfrica, under the auspices of Forestry South Africa, Sappi is working with FSCto test a number of approaches to certification to see if micro growers can beassessed in a different way to the current approach used by the FSC®. Theproject is scheduled to take three years to be completed. Sappi is currently inthe 2nd year of research. In South Africa, Sappi has established an FSC®group scheme for small and medium growers. In North America, Sappi is afounding member of the Forest Products Working Group. For its inauguralproject, the group designed a set of guidelines to aid the respon-sibleprocurement, use and recovery of paper products. Co-chaired by Sappi’sDirector of Sustainability, project work is under way with the FPWG to identifyand address some of the barriers to expanding the growth of certified forests.Sappi North America was the first pulp and paper company in North America tobe granted a group forest management certificate by the FSC®. Through thiscertificate, small landowners who agree to enter as a member of Sappi’s forestmanagement group have their land certified in accordance to the FSC®standard.

belong, CEPI, AF & PA and PAMSA, Sappi lobbies on various issues – forexample, in Europe the removal of co-firing of wood in coal plants which onlyproduce electricity. SNA’s Sustainability Customer Council is composed ofSappi customers who represent key segments from the coated and releasepapers business units. As part of Sappi’s com¬mitment to engaging with andunderstanding a variety of environmental and business perspectives, theCouncil meets semi-annually to discuss emerging industry issues and customerneeds that impact Sappi North America’s sustainability strategy. GreenBlue®is a non-profit organization whose goal is to empower business leadership tobuild a thriving, resilient material economy. As a founding member ofGreenBlue’s Forest Products Working Group, Sappi is heavily involved in anIndustry Leadership Committee working on forest certi¬fication issues. Utilizinga unique Value Innovation Process, the group is exploring the key elements ofcertification that provide value to various stakeholders. Efforts are under way toexplore efficient and cost-effective models (including but not limited tocertification) that would enable small private landowners in the US to providebrand owners the level of assurance they need that they are sourcing fibrefrom responsibly managed forest land. in March 2014 the United StatesDepartment of Agriculture approved a “commodity check-off” programme forthe paper and paper-based packaging industries. Under this programme paperand packaging man¬ufacturers and importers will fund a broad basedconsumer campaign to spur demand.. Sappi is an investor in the campaign andthe EVP: Coated Business serves as a member of the Paper and PackagingBoard for the Northeast region.

Further Information

Attachments

https://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F10.Engagement/Sappi-FAQs-Project-Grow.pdfhttps://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F10.Engagement/Sappi-FAQs-Forest-certification.pdf

https://www.cdp.net/sites/2015/90/16290/Forests 2015/Shared Documents/Attachments/Forests2015/F10.Engagement/Sappi-FAQs-Biofuels.pdf

Module: Challenges

Page: F11. Barriers and challenges

F11.1

Please describe any key barriers or challenges to achieving deforestation free direct operations and supply chains

Sappi's own internal controls, together with the externally verified, internationally recognised certification systems used by the group gives Sappi a high level ofconfidence that the group has a 100% deforestation free sourcing practice in place.

F11.2

Please describe any measures that would improve your organization’s ability to manage deforestation risk

GMOs might help Sappi to manage deforestation risk. Sappi has taken the decision to understand the challenges and risks of GMO tree crops as the group'scompetitors in the wood fibre space have started utilising the technology. While Sappi sees potential environmental, social and reputational risks with GM’s, thegroup also sees GMOs as a potential method to adapt its plantations to a potentially rapidly changing climate and as a renewable source of chemicals, energy andfibre.

Further Information

Module: Sign Off

Page: F12. Sign off

F12.1

Please provide the following information for the person that has signed off (approved) your CDP forests response

Name Job title Corresponding job category

Graeme Wild Group Head, Investor Relations and Sustainability Other:

Further Information

Mr Wild is a member of the Executive Management CommitteeCDP 2015 Forests 2015 Information Request

CDP 2015 Forests 2015 Information Request - Sappi · 2016-09-08 · CDP CDP 2015 Forests 2015...

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