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Water risk management

Using water as a resource comes with inherent risks. We work to minimize the impact of our processes while also preparing for external risks that could affect operations in certain areas.

Our operating environment exposes us to various water-related risks, many of which stem from local conditions, political and economic factors, and global megatrends such as climate change and extreme weather events. Floods, droughts, and poor raw water quality pose risks to our operations, personnel, environment, and local communities.

The first step in managing these risks is carefully assessing the locations where we operate. Our production sites are situated in areas with sufficient water availability. This helps mitigate the risk of water shortages affecting our processes, the environment, and surrounding communities.

Almost all our production and hydropower sites operate under a verified environmental management system. We regularly monitor water quality to safeguard local ecosystems and employ the best available techniques to reduce harmful emissions, enhance water and soil quality, and support local biodiversity.

Water risk management across operations

Our pulp and paper mills have plans to achieve water use and effluent load reduction targets by 2030, using e.g. advanced process controls and predictive models to optimize wastewater treatment.
In addition to local regulations, we adhere the EU’s Water Framework Directive (WFD), which aims to ensure both the qualitative and quantitative health of water, reduce pollution, and guarantee enough water to support wildlife alongside human needs.
We collaborate internally and externally with environmental experts, researchers, and local authorities. One key area of cooperation is flood protection, where we work alongside authorities and regulators to mitigate the severe impacts of flooding.
We pre-evaluate all chemicals to ensure full compliance with local regulations and adherence to the UPM Internal Safety Standard for Chemical Management. This helps minimize spills into the aquatic environment.

Read more about our 2030 sustainability targets here.

Learn more about our environmental performance

We disclose a comprehensive amount of information about our environmental, social, and governance performance in our Annual Report 2024. The report complies with the EU Corporate Sustainability Reporting Directive (CSRD) and the European Sustainability Reporting Standards (ESRS).

Read more in our Sustainability Statement

Explore our water risk assessment studies

Climate changes such as extreme droughts and floods have the potential to seriously affect water and all systems depending on it.

UPM has been mapping all its pulp and paper mills on the Water Stress Index (WSI) and similar maps since 2011. In 2019 the analysis was based on the WWF’s Water Risk Filter, a tool which addresses:

a company’s geographical location, which informs a site’s basin-related risks;
characteristics of its operating nature (e.g. its reliance upon water, its water use performance given the nature of the business/site), which informs a site’s operational-related risks.

At the end of 2020, WWF introduced an upgrade of the Water Risk Filter tool (Water Risk Filter 5.0) with new features including a 2030 – 2050 simulation based on +1.5°C (optimistic), +2°C (current trend) and +3.5°C (pessimistic) climate scenarios that are aligned with the Task Force on Climate-related Financial Disclosure (TCFD) recommendations. UPM used this tool to update its 2019 Water Risk analysis for its pulp & paper mills with 2020 operational data and assessed the Basin risk level in 2021, 2030 and 2050. In addition to its pulp and paper mills, the analysis also covered UPM Biochemicals, UPM Biofuels, UPM Raflatac (now UPM Adhesive Materials) and UPM Plywood.

In 2024, WWF introduced yet a new version of the Risk Filter Suite (2.0) with many updated and new indicators. This version UPM used in 2025 to update the risk scenarios with 2024 production data. Analysis of these findings is ongoing.

Focusing on water related risks

UPM’s main production sites are well located

In conclusion, UPM’s main production sites are located in areas of low to medium basin risk for all climate scenarios 2030 – 2050, with only one exception. The UPM Changshu paper mill in China falls into a high-risk category by 2030 in both the +3.5°C scenario and the +2.0°C scenario but remains in the medium-risk category in the + 1.5°C scenario. This is due to increasing risk scores in water scarcity, water flooding, water quality and biodiversity.

While the Changshu paper mill near Shanghai is expected to face the greatest rise in water risk by 2050, the mill has made substantial improvements in water efficiency in recent years (Read more on UPM Changshu’s EMAS statement). The mill was also recognized as the State Level Water Efficiency Front Runner by the Chinese government.

2021 – UPM Pulp & paper mills overall basin risk

Current trend 2030 Scenario – UPM Pulp & paper mills overall basin risk

Current trend 2050 Scenario – UPM Pulp & paper mills overall basin risk