Climate Change Data

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Environmental and Energy Policy

Governance Achievements

• Applied the Swedish Code of Corporate Governance without deviations in 2015.
• Established a Nominating Committee with representation from major shareholders.
• Held Annual General Meeting and Extraordinary General Meeting to address shareholder matters.
• Implemented a system for internal control and risk management based on the COSO model.

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Swedish Companies Act, Annual Accounts Act, Rules of the Stock Exchange, Swedish Code of Corporate Governance

Environmental Metrics

ESG Focus Areas

• Safety
• Sustainability
• Packaging

Environmental Achievements

• Reduced electricity consumption by 14% per tonne of pulp at Rottneros Mill since 2010.
• 99% of fuel used at Vallvik Mill is biofuel.
• 97% of all chemicals used in the production process at Vallvik Mill are recycled.
• 70% of the electricity at Vallvik Mill is produced in the mill.
• Reduced consumption of bleaching chemicals on the CTMP line by 20 percent.

Social Achievements

• Continued work with skills development within the Group.
• High marks in employee survey, ranking better than industry average in commitment, leadership, efficiency and NPS.
• Launched Rottneros Academy, an internal education concept.
• Collaboration with educational institutions to design better preparatory courses for operator positions.

Governance Achievements

• Applied the Swedish Code of Corporate Governance without deviations.
• Systematic evaluation of Board's work annually.
• Audit Committee and Compensation Committee work.

Climate Goals & Targets

Environmental Challenges

• Lower pulp prices than the previous year.
• Unexpected disruptions in production at Vallvik Mill.
• Higher electricity prices (33% higher than previous year).
• Optimising complex processes to increase production volumes.
• Maintaining sufficient pulp wood supply.

Mitigation Strategies

• Focus on selected niche products with higher added value.
• Long-term supply agreements with pulp wood suppliers.
• Investments in capacity expansion and efficiency improvements (Agenda 500).
• Financial hedging activities (currency and electricity).
• Strengthened wood procurement organization at Vallvik Mill.

Supply Chain Management

Responsible Procurement

• Traceability certification for pulp wood (FSC and PEFC).

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Completely bio-based packaging trays

Environmental Metrics

ESG Focus Areas

• Safety and health
• Long-term profitability
• Customer satisfaction
• Gender equality
• Environment

Environmental Achievements

• Rottneros Mill invested 18 MSEK in a methane gas burner, achieving an essentially fossil-free production process.
• Vallvik Mill's emissions parameters reached their lowest ever levels in 2020.
• Reduced annual oil consumption by roughly 7,000 cubic meters at Rottneros Mill while sharply increasing production volume.

Social Achievements

• 97% of employees completed the web-based training in the Code of Conduct.
• Launched a support hotline for employees worried about the pandemic.
• Offered employees with healthcare training paid leave to assist the healthcare system.

Governance Achievements

• Company complied with the applicable remuneration guidelines adopted by the general meeting. No deviations from the guidelines were decided.

Climate Goals & Targets

Environmental Challenges

• Coronavirus pandemic impacted operations.
• Weak global economy put pressure on earnings.
• High electricity prices in certain periods due to inadequate transmission capacity.
• Low market prices for pulp.
• Weak European pulp market.
• Workplace accidents.

Mitigation Strategies

• Implemented early and extensive measures to keep the coronavirus away from facilities.
• Focused on constant improvements and fine-tuning for increased production and efficiency.
• Hedged future electricity prices.
• Broadened business base (fibre trays, Nykvist Skogs acquisition).
• Implemented preventive safety efforts and a zero vision approach to workplace accidents.
• Cost control measures.

Supply Chain Management

Responsible Procurement

• Traceability-certified wood (FSC® and PEFC™)

Climate-Related Risks & Opportunities

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 12: Responsible Consumption and Production
• Goal 13: Climate Action
• Goal 14: Life Below Water
• Goal 15: Life On Land

Initiatives contribute to these goals through sustainable production, reduced emissions, responsible resource management, and sustainable forestry practices.

Sustainable Products & Innovation

• Fibre trays for ready-made meals

Environmental Metrics

ESG Focus Areas

• Safety and health
• Long-term profitability
• Customer satisfaction
• Gender equality
• Environment

Environmental Achievements

• Invested 33 MSEK in Vallvik Mill to minimize water emissions.
• Invested 40 MSEK in Rottneros Mill's biomass boiler to increase availability and reduce fossil fuel use.
• Reduced CO2 emissions in production by 3%.

Social Achievements

• Increased the frequency of employee surveys to every two months.
• Implemented a new and more restrictive drug and alcohol policy.
• Conducted training on discrimination and sexual harassment for all managers.

Governance Achievements

• Intensified work on screening customers and partners for compliance with corruption and competition law.

Climate Goals & Targets

Environmental Challenges

• Unplanned production stops at both mills.
• High electricity prices impacting Rottneros Mill production.
• Global logistics challenges causing increased transport costs.
• Russia's attack on Ukraine causing indirect impacts through higher energy and freight prices.

Mitigation Strategies

• Highly effective electricity price hedges offsetting the negative effects of high prices.
• Analysis initiated for a more long-term approach to reduce electricity price exposure.
• Focus on continuous improvement of internal efficiency.
• Long and close customer relationships and agile organization helped manage logistics challenges.
• Exploration of options to reduce structural exposure to electricity prices.

Supply Chain Management

Supplier Audits: All suppliers certified to FSC's Controlled Wood standard in 2021.

Responsible Procurement

• Focus on suppliers close to mills to minimize transport emissions.
• Long-term supply agreements with major pulpwood suppliers.

Climate-Related Risks & Opportunities

Opportunities

• Development of sustainable products to replace fossil-based alternatives.

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 12: Responsible Consumption and Production
• Goal 13: Climate Action
• Goal 14: Life Below Water
• Goal 15: Life On Land

Rottneros' operations contribute to these goals through sustainable forestry, renewable products, and efforts to reduce environmental impact.

Sustainable Products & Innovation

• Moulded fibre trays

Awards & Recognition

• EcoVadis Silver rating (2020 and 2021)

Environmental Metrics

ESG Focus Areas

• Safety
• Long-term profitability
• Diversity
• Customer satisfaction
• Fossil-free production
• Environmental impact

Environmental Achievements

• Reduced fossil CO2 emissions by 26 percent compared with 2021.
• Vallvik Mill achieved the lowest ever emissions in several parameters in 2022.
• Rottneros Mill achieved a new annual record for CTMP production, increasing by about 5 percent over 2021.

Social Achievements

• Number of accidents with sick leave decreased to 7.4 LTIFR from 13.0 compared to the previous year.
• Increased the proportion of women in recruitment.

Governance Achievements

• Applied the Swedish Code of Corporate Governance without deviations in 2022.
• The Board of Directors carried out an annual systematic evaluation of its work.

Climate Goals & Targets

Environmental Challenges

• Volatile electricity prices, especially impacting Rottneros Mill's electricity-intensive groundwood line.
• Increased competition for pulp wood due to reduced supply from Russia and increased demand from the energy sector.
• Increased cost inflation towards the end of the year.
• Structurally shrinking demand for printing paper.

Mitigation Strategies

• Electricity price hedges more or less fully offset exceptionally high electricity prices.
• Long-term relationships with pulp wood suppliers secured fibre supply.
• Intensified focus on efficiency improvements to offset higher costs.
• Phased out groundwood pulp production at Rottneros Mill due to negative outlook for printing paper and electricity market conditions.
• Preparing for investment in additional CTMP capacity.

Supply Chain Management

Supplier Audits: All suppliers were certified to the FSC® Control Wood Standard in 2022.

Responsible Procurement

• Careful selection of suppliers and raw materials.
• Long-term supplier agreements for pulp wood.

Climate-Related Risks & Opportunities

Transition Risks

• Changes in environmental legislation
• Increased energy prices

Opportunities

• Development of energy-efficient products
• Growing demand for fibre-based packaging

UN Sustainable Development Goals

• Goal 5
• Goal 8
• Goal 12
• Goal 14
• Goal 15

Rottneros' focus areas are linked to these UN Sustainable Development Goals.

Sustainable Products & Innovation

• Moulded fibre trays (Rottneros Packaging)

Awards & Recognition

• EcoVadis Gold rating (Rottneros Mill), Silver rating (Vallvik Mill)

Environmental Metrics

ESG Focus Areas

• Health and safety
• Sustainable profitability
• Gender equality and diversity
• Customer satisfaction
• Fossil-free production and environment

Environmental Achievements

• Reduced fossil fuel emissions by 71% at Rottneros Mill due to the closure of the grinding line and increased use of biofuels.
• Vallvik Mill achieved lowest ever emissions for many parameters in 2023.
• Rottneros Mill reduced COD emissions from the treatment plant by 34% compared with the previous year.

Social Achievements

• Increased proactive risk observations at Rottneros Mill, a vital component of preventive work aimed at mitigating accident risks.
• Launched a new product concept, Nature by Rottneros, emphasizing sustainable raw materials and climate-friendliness.

Governance Achievements

• Refinanced long-term credit facilities with a sustainability link, whereby interest terms are linked to environmental and work environment criteria.

Climate Goals & Targets

Environmental Challenges

• Lower sales prices and higher raw material costs.
• Weak pulp market in the first half of the year.
• Long delivery times impacting the schedule for the Poland project.
• Increased competition for raw materials due to growing demand in the energy sector.
• Higher number of accidents with sick leave compared to the previous year.

Mitigation Strategies

• Implemented efficiency measures to offset cost inflation.
• Focus on specific niches ensured robust demand and full production.
• Entered into a long-term agreement to secure access to renewable energy with German EnBW.
• Strengthened ties with sawmills to improve woodchip supply.
• Continued investments in staff training and facilities to improve safety.

Supply Chain Management

Supplier Audits: 68% of suppliers met the criteria for FSC® or PEFC certification in 2023.

Responsible Procurement

• Traceability-certified pulp wood ensuring responsible forestry.
• Selection of suppliers close to units to minimize emissions.

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products
• Growing demand for sustainable packaging solutions.

UN Sustainable Development Goals

• Goal 5
• Goal 8
• Goal 12
• Goal 14
• Goal 15

Rottneros' initiatives contribute to these goals through sustainable forest management, safe working environments, responsible resource use, reduction of marine pollution, and conservation of ecosystems.

Sustainable Products & Innovation

• Molded fiber trays
• Fiber-based closures (through investment in Blue Ocean Closures)

Awards & Recognition

• EcoVadis Gold rating for Rottneros Mill (2023)
• EcoVadis Silver rating for Vallvik Mill (2022)