Business Model

 

UPM consists of six separate business areas. Our business areas are competitive, with strong market positions and a leading financial and sustainability performance. Five of these business areas operate in healthily growing markets.

 The business model change has yielded benefits: 

  • Transparency and accountability – commercial strategies, benchmarking, target setting, incentives
  • Cost competitiveness – agility, improved efficiency, optimised sourcing
  • Growth – focused investments with attractive returns and clear competitive advantage

Capturing corporate benefits

UPM group aims to add value to its businesses and stakeholders with:

  • Competitive and sustainable wood sourcing, forestry and plantation operations
  • Value adding, efficient and responsible global functions
  • Continuous improvement (Smart) programmes
  • Technology and intellectual property rights
  • A global platform to build on
  • Disciplined and effective capital allocation
  • Compliance with applicable laws and regulations and corporate policies

Decision making on the right level

Each business area is responsible for executing its own strategy and achieving targets. Group direction and support from global functions enable the businesses to capture benefits from UPM’s brand, scale and integration, while navigating the complex operating environment. Capital allocation decisions are made at group level.

 

Disciplined capital allocation

  • UPM aims to pay an attractive dividend
  • UPM aims to maintain a strong balance sheet to mitigate risks and enable strategic opportunities to be captured
  • UPM invests in projects with attractive and sustainable returns, supported by clear competitive advantage
  • In UPM Communication Papers, UPM aims for strong cash flow and releasing capital