Most of the targets and measures of good governance (ESG) are the responsibility of the Metsä Group’s management and logistics professionals. Their efforts help ensure that suppliers meet the sustainability requirements.
“Alongside general sustainability requirements for suppliers, mills also play an important role in monitoring supplier requirements. For example, suppliers of chemicals to pulp mills must meet requirements concerning product safety, and the mills make sure that they do. This ensures that our own production meets the required standards,” says Marko Ruottinen, Metsä Fibre’s Sustainability Manager.
Sustainable business encompasses the entire value chain. To verify the sustainability of raw material sources, their origin must be determined.
“It’s important for us to know where our raw materials come from and the kind of operators we are working with. In our procurement, we use suppliers with established sustainability practices and thus support a societal shift to more sustainable operating methods,” says Kaija Pehu-Lehtonen, SVP, Business Development, who is in charge of strategic sustainability targets at Metsä Fibre.
In 2022, the traceability of all Metsä Fibre’s raw materials was 96 per cent. Our goal is that 100 per cent of our raw materials will be traceable and certified wood will account for more than 90 per cent of our wood raw material.
“The main goal of the certification system is to ensure the chain of custody. Alongside traceability, forest certification includes criteria related to forest sustainability management, which are related to the management of forest use, biodiversity, the protection of waterbodies, the safety of employees, and safeguarding the rights of local residents,” Ruottinen says.
The origin of other raw materials used in the production process, including chemicals, is determined using product safety surveys and supplier surveys. Traceability data helps to target assessments and audits on potential risk suppliers.
The Code of Conduct also applies to suppliers
Metsä Group wants to ensure that all its suppliers comply with environmental, social and economic requirements. Suppliers have to commit to the Code of Conduct.
“We monitor our supply chain with supplier surveys and audits, just as our customers monitor us and audit our Code of Conduct,” says Ruottinen.
Metsä Group’s common procurement and logistics unit is largely responsible for cooperation with suppliers. The goal is to assess 100 per cent of the company’s key suppliers.
However, it’s also possible for us to track how many of Metsä Fibre’s own suppliers have been audited and how many of them have committed to the Code.
After assessment and auditing, suppliers can be required to develop their ethical operations, risk management, environmental management, safety at work or other such matters.
Ideally, sustainability means cooperation with partners. Sharing sustainability targets with our partner suppliers is a new element. The goal is to influence matters outside our own production units as well.
Practical examples of the partner programme include the agreement concluded with the Finnish railway company VR on reducing the carbon dioxide emissions of logistics in the supply chain, as well as the agreement with Kemira on the development of new fossil free products.
Customers demand sustainability
For most of Metsä Fibre’s customer companies, ESG reporting is part ofdaily operations. A major share of customer inquiries concerning sustainability is related to forests and their use.
“Using similar reporting categories facilitates their operations. We often get questions about the origin of wood, tree species, the supply chain and forest management,” says Ruottinen.
In recent years, climate change has become an increasing concern globally, and more and more operators want to determine the carbon footprint of their products.
“When we reduce our carbon emissions, our customers’ figures also improve. Everything we do strengthens the supply chain,” says Ruottinen.