Biofore strategy leads our way

UPM's responsibility focus areas, targets and performance indicators cover all three areas of responsibility: economic, social, and environmental responsibility.

​Responsibility focus areas and targets steer business

Based on a materiality analysis, UPM has established a set of responsibility focus areas to guide its responsibility activities, and determined targets and performance indicators.

The responsibility focus areas, targets and performance indicators were updated in 2015. Some of the targets are continuous and some have been extended to 2030. For environmental targets, the reference year 2008 was maintained to ensure that the new targets remain comparable with previous targets.

In addition to being influenced by the materiality analysis, UPM’s new long term responsibility targets were also influenced by the UN’s Sustainable Development Goals (SDG) published in September 2015.

UPM's responsibility targets to 2030:

UPM RESPONSIBILITY FOCUS AREA​2030 TARGET​2030 FOLLOW-UP / 2015 RESULTS

​ECONOMIC

PROFIT - Creating value to shareholders
  • ​Operating profit margin > 10%
  • Return on equity at least 5 percentage points above the yield of a 10-year risk-free investment    
  • Gearing ratio to be kept below 90%
  • ​Operating profit excluding special items was 11.5% of sales.
  • Return on equity excluding special items was 12.1%.
  • Gearing ratio as of 31 December 2015 was 26%.
GOVERNANCE - Ensuring accountability and compliance
  • ​100% coverage of participation to UPM Code of Conduct training (continuous)
  • ​More than 90% of employees have completed the previous Code of Conduct training.
RESPONSIBLE SOURCING - Adding value through responsible business practices
  • 80% of UPM spend qualified against UPM Supplier Code (continuous)
  • 100% of UPM raw material spend qualified against UPM Supplier Code by 2030 1)
  • Continuous supplier auditing based on systematic risk assessment practices
  • ​79% of supplier spend qualified against UPM Supplier Code (+12pp compared with 2014).
  • 92% of raw material spend qualified against UPM Supplier Code.
  • Since 2013, the number of risk assessment-based supplier audits has been doubled, with a much wider geographical area than earlier

​SOCIAL

DIVERSITY AND INCLUSION - Developing organisational culture and local conditions to ensure inclusive and diverse working environment for business success 
  • ​All UPM employees are treated as individuals regardless of gender, age, race, nationality, etc. 100% favourable responses in Employee Engagement Survey by 2030
  • Diversity initiative to be started in 2016
  • ​Responses to Employee Engagement Survey's diversity question were 77% favourable.
  • Initiative will be  started in 2016.
CONTINUOS LEARNING AND DEVELOPMENT - Ensuring high performance for business success and continuous professional development for future employability
  • ​Target setting and development plan for all employees, completion rate 100% by 2030
  • Employees experience the opportunity for learning and development, 80% favourable in Employee Engagement Survey by 2030
  • 86% of all permanent employees had a personal performance review with their managers.
  • ​Responses to Employee Engagement Survey's question regarding learning and development were 61% favourable.
RESPONSIBLE LEADERSHIP - Emphasising value-based and inspiring leadership and integrity. Continuous development of working environment
  • ​Employee engagement index overall favourable score in global top quarter by 2030
  • ​Employee engagement index overall favourable score increased to 66%. This is 10% below global top quarter.
​WORKING CONDITIONS - Ensuring safe and healthy working environment and wellbeing of employees
  • ​No fatalities or serious accidents in UPM operations
  • Continuous improvement in safety: Lost time accident frequency (LTAF) <1 and Total recordable injury frequency (TRIF) <2 levels permanently reached including contractors
  • All operations have certified OHS system by 2030
  • Health Promotion Programme is in use at all UPM sites and businesses by 2030
  • Absenteeism rate < 2 % in all organisations by 2030
  • ​One fatal contractor accident in 2015.
  • LTAF was 3.9 for own employees and 5.5 for contractors. TRIF was 10.6 for own employees. Follow-up of TRIF for contractors will be evaluated in 2016.
  • All production sites have an OHS management system in place. 45% of the sites got external certification of their OHS system.
  • A majority of the sites have started their programme.
  • The absenteeism rate was 3.7% in 2015.
COMMUNITY INVOLVEMENT - Ensuring local commitment
  • ​Continuous development of strategic sustainability initiatives with leading NGOs
  • Continuous sharing of best practices of stakeholder initiatives
  • UPM sponsorship and donations programme to be started
  • ​Co-operation with BirdLife and Vida Silvestre continued.
  • Sharing of best practices ensured through well-established operational stakeholder forums, for example.
  • Programme will be started in 2016.

​ENVIRONMENTAL 2)

PRODUCT STEWARDSHIP - Taking care of the entire lifecycle
  • ​Environmental Management Systems in 100% use (continuous)
  • Environmental Product Declarations for all products (continuous) 3)
  • All applicable products ecolabelled by 2030
  • ​All production sites have a certified environmental management system in place, except the new biorefinery.
  • Environmental declarations are available for all relevant UPM products.
  • The share of ecolabelled products was 77% (76% in 2014).
WASTE - Promoting material efficiency and circular economy - reduce, reuse and recycle
  • ​No process waste to landfills or to incineration without energy recovery by 2030
  • ​Over 90% of UPM's total process waste was recycled or recovered.
​CLIMATE - Creating climate solutions and working towards carbon neutrality
  • ​Fossil CO2 emissions from own combustion and purchased electricity (Scope 1 and 2) reduced 30% by 2030
  • Maximise the business benefits of greenhouse gas claims (continuous)
  • Acidifying flue gases (NOx/SO2) reduced 20% by 2030 4)
  • ​Despite improvements in fuel mix and energy efficiency, actions have not compensated for the increased level caused by the Myllykoski acquisition in 2011 and increased CO2 factors for purchased power.
  • UPM sold greenhouse gas claims worth of 0.5m CO2 tonnes. Without sales UPM's reported emissions (Scope 1 and 2) would have been over 7% lower.
  • 20% reduction achieved since 2008 for the UPM average product.
​WATER - Using water responsibly
  • ​Effluent load (COD) reduced 40% by 2030 4)
  • Wastewater volume reduced 30% by 2030 4)
  • 100% nutrients used at effluent treatment from recycled resources by 2030
  • ​29% reduction achieved since 2008 for the UPM average product
  • 11% reduction in wastewater achieved since 2008 for the UPM average product.
  • Project will be started in 2016.
FORESTS AND BIODIVERSITY - Ensuring sustainable land use and keeping forests full of life
  • ​100% coverage of chains of custody (continuous)
  • All fibre certified by 2030
  • Coverage is 100%.
  • The certified fibre share increased to 84%.
1) Covers all UPM raw material spend including wood and wood-based biomass sourcing and excluding energy
2) Environmental targets: from 2008 levels;
3) Includes paper, timber, plywood, pulp and label;
4) Numerical targets relevant for pulp and paper production

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