Last week International Paper (IP), a $26 billion company with over 60,000 employees worldwide, issued its 2011 sustainability report. The 47-page report is chock full of details about the pulp and paper giant’s goals for 2020, and more of a forward-looking sustainability statement instead of a listing of accomplishments from the previous year. The company’s discussion of its direction is also typical of what a publicly-held company experiences as it becomes more of a sustainable business. “Going green” on a dime is not so simple when a firm must answer to a gaggle of stakeholders and, of course, stockholders.
IP has established a realistic set of initiatives for the coming decade. Considering how important paper is to just about every company’s supply chain and packaging needs, many of the goals, from water stewardship to solid waste management, could be a challenge to meet in the coming years. But IP’s sustainability agenda could raise the bar for other companies within its industry. After all the paper is one of the first industries that will be directly hit by deforestation, resource constraints and climate change should global temperatures continue to rise in the coming years.
Some of IP’s more compelling achievements and goals include:
Fiber certification: IP has pledged a 15 percent global increase in its third party certified paper volume by 2020. Before the catcalls begin, shouting that such an increase is too modest, it is important to remember that companies like IP are often locked into long term contracts with vendors from which they source raw materials. The demand for certified, sustainably grown fiber for paper products exceeds supply, too. What could raise the hackles of the industry’s critics, however, is the company’s work with the Sustainable Forestry Initiative, an organization often criticized for having too cozy of a relationship with the industry. But IP works with just about every certification program available, a task that is certainly commendable.
Water stewardship: One common complaint of the pulp and paper industry is the pollution dumped into local streams and watersheds. IP has pledged a 15 percent reduction in wastewater discharges of oxygen depleting substances into receiving streams. The company has also pledged to map its water usage throughout its entire operations by 2013 and develop plans to reduce the company’s total consumption by 2020.
Emission reductions: IP promises to lower its total pollutant emissions 10 percent by the end of the decade, and based on the company’s current and past performance, that should be a goal not only met, but exceeded.
Safety: “An accident free workplace.” But that should be a goal of every company, right?
Biomass: IP’s partnership with the National Council for Air and Stream Improvement (NCASI) has led to the early formation of the Forest Biomass Cooperative. This organization will lead scientific research that will support sustainable production and distribution of biomass grown in managed forest settings. Considering the energy potential that can result from pulp and paper processing, the conversion of what was once waste to fuel should be a no-brainer for the entire industry.
Tree farming in India: Last year IP acquired Andhra Paper, a massive manufacturer of pulp and paper products that has an annual capacity of 240,000 metric tons. Since Indian law does not allow companies to own forest land, IP now sources from over 44,000 individual farmers who cull trees on small lots. Andhra’s farm forestry program, which dates back to 1989, provides seedlings and technical support who often farm on the most marginal land. With the one billionth seedling on target for planting this year, IP has an opportunity to extend Andhra’s legacy to other countries in which it operates.
IP’s sustainability program is a lesson in how stakeholder engagement directs a company’s corporate responsibility agenda. While customers and local community groups were vocal about an increased focus on sustainability, investors and suppliers “have not raised any significant concerns” about the issue. IP’s challenges are similar to companies across all industries: the difficulty in nudging suppliers to be more socially and environmentally responsible, as well as convincing cranky investors that sustainability is not a luxury, but a long term business necessity.
Photo courtesy International Paper.