Stora Enso Driving Sustainable Forestry in Russia

Helsinki, Finland, 14 December 2006 -- A coalition of two Russian logging companies, four of the world's largest users of paper products, and one of the most important paper producers today released a project report "From Russia . with Transparency" documenting the key success factors in enhancing business practices, labor safety, and sustainable forestry in the Russian forest sector. The report is the outcome of a three-year joint effort to improve environmental and social performance in the Russian wood supply chain.

Together with the Russian partners work was done to improve safety training for forestry workers, introduce new logging technology, apply for Forest Stewardship Council (FSC) forest certification, and implement new guidelines and reporting practices. The work was observed and the findings were reviewed by Transparency International and the Russian Karelian Research Center.

The project partners span the entire supply chain, from the Russian forests to international paper and board markets. The Tikhvin-Chalna Project received its name from the communities where the Russian logging companies, Russkiy Les (Tikhvin) and Shuyales (Chalna), are located. The paper producer is Stora Enso and the three publisher partners are Axel Springer, The Random House Group UK, and Time Inc. Tetra Pak represents liquid food and beverage carton manufacturing in the project team.

Positive feedback from external observers

"The project team should be congratulated for addressing the issue of legality and business ethics in the forest sector," said Kenneth Rosenbaum of Transparency International's Forest Integrity Network. The project's objective for legal matters, including business ethics, was to create guidelines and implement them. "In the future, the partners will need to give some thought to how they will measure the success of their programmes of business ethics."

Galina Kozyreva, senior researcher of the Karelian Research Center of the Russian Academy of Sciences concurs. "The results are reviewed in the context of current legislation, corporate guidelines and international standards of sustainable forestry. The project partners' progressive third-party verifications increase the credibility and transparency of the supply chain."

Ensuring legal origin of wood and sound business practices

The legal origin of wood and integrity of business practices are addressed through improved business guidelines and a third-party verified wood traceability system to monitor the legal origin of wood. Stora Enso's traceability system in Russia includes annually more than 200 field audits of logging sites, where legal documentation, environmental and labor safety aspects are checked.

Achieving improvements in labor safety

The project demonstrates important results in labour safety thanks to the adoption of new logging technology, training, and safety equipment. A major occupational safety programme at Stora Enso's newly acquired subsidiaries in Russia works to bring the number of all work-related accidents to a target level of zero.

Accomplishing sustainable forestry

Victor Pladov, chairman of the board of Shuyales states, "We started the work in Shuyales by organising a workshop for our employees, contractors and the local forest management authority. We discussed labor safety, business practices and sustainable forestry, and agreed upon a roadmap for enhancing sustainable forestry."

"A major achievement was that Russkiy Les and four other Stora Enso's Russian subsidiaries prepared more than 400,000 hectares of forest lease areas for FSC forest management and chain-of-custody certification. The auditing process was started in March 2006," said Kauko Parviainen, senior vice president, Stora Enso Wood Supply Russia.

Project benchmarks

Over the course of the project, the partners have been actively engaged in various sustainability initiatives.

"The main contribution of The Random House Group UK was achieving FSC chain-of-custody certification, the first consumer book publisher worldwide to do so. We therefore particularly welcome Stora Enso's FSC forest management certification process of its forest lease areas in Russia," said Katherine Hockley, production manager of Random House.

Florian Nehm, sustainability officer at Axel Springer AG, said, "For us, sustainability is a matter of credibility. Development of transparent sustainability reporting was one goal of the collaboration. The Axel Springer Sustainability Report 2005 is the first benchmark of verified social reporting in the publishing sector, and in compliance with the GRI (Global Reporting Initiative) indicators."

David Refkin, director of sustainable development at Time Inc., added, "We joined the project for many reasons. One key result was Stora Enso's implementation of FSC group forest certification in Russia, which helps us reach our certified sustainable forestry targets for our paper suppliers."

"We want consumers to feel that the packaging that protects their drinks also protects their environment. This project demonstrates industry leadership in improving every aspect of sustainability. And, to prove that through forest certification and full traceability of the origin of wood," said Mario Abreu, forestry director of Tetra Pak.

Dissemination of results continues

The focus now is on sharing the project results and best practices with other wood suppliers in Russia. This will be implemented through Stora Enso's supplier audits and trainings. In June 2006, the seven project partners and the two critical reviewers jointly launched this process at Stora Enso's supplier seminar in the Russian Karelia. The results of the Tikhvin-Chalna Project are also shared through a project report, a newsletter, and a Web site (www.tikhvinproject.ru). The Web site includes a film from a workshop in Russian Karelia in summer 2006.

The project partners will continue to, individually, support Stora Enso in this work when appropriate.