A Letter From Sappi North America's CEO and President Mike Haws

As we look ahead to the next five years of growth and innovation, we couldn’t be more optimistic about our prospects here at Sappi North America (SNA).

We have the strongest team in the industry, a team that has tackled issues head-on, transforming our company into a well-diversified and resilient organization. Our commitment to sustainability provides us with a competitive advantage in a market demanding renewable resource solutions, and delivers enhanced value to all stakeholders. Our approach establishes a path for future investment and growth for the benefit of all of our employees and the local communities where they live and work.

We have a bold vision for Sappi North America and complementary values, which we see as providing the foundation of our future collective success.

Safety

Our commitment to the safety and well-being of our employees is a bedrock value shared by all of us at SNA. Without a demonstrated track record of continuous safety improvement, we simply would not be a successful company. We finished our fiscal year 2019 with a lost time injury frequency rate (LTIFR) of 0.25—the second consecutive year where we achieved our lowest full-year result ever. In addition, our severity rate has declined significantly from a high of 1,673 lost workdays in 2011 to 588 lost workdays in 2019—a 65% decrease. This impressive safety performance reflects the engagement and focus of all of our employees and the personal accountability they bring to the job every day.  

Investment in our employees and in our communities

No company can achieve sustained success without engaged, empowered, and inspired employees. In 2017, we established sustained engagement as a global five-year goal to foster collaboration with our employees; in 2019, we earned a score of 78%, in line with other global manufacturing companies, and we strive to do more. We have rolled out an employee recognition program, TOUTS, which celebrated more than 2,700 acts of excellence from SNA employees in 2019. Additionally, this past year alone, we provided 105 hours of training per employee (more than 2½ weeks) on average.

We recognize our responsibility extends to advancing the vibrancy and health of our communities where we work and live. We invest in our local communities, providing educational and training resources as well as leveraging the energy and passion of our employees through our Employee Ideas that Matter grants. We support local college and university programs not only through financial support but through company mentorship programs. We are active members of the community, participating in educational, charitable, and civic events throughout the year. We know that giving back to our communities makes us stronger. 

Reflecting the values of our customers

Our long-term success depends on our customers. We must strive every day to deliver products and services that anticipate their needs and satisfy their requirements for consistency, reliability, and advantaged performance. The far bigger challenge now is to understand our customers’ needs beyond product attributes and service. Our customers want to know the environmental footprint of our products and services. They want to understand our strategies and success in reducing waste throughout our manufacturing process and logistics networks. They demand that we design products with end of life in mind—with a renewed focus on recyclability and compostability. They also expect greater transparency in the full supply chain they are part of, asking us to assess and mitigate risk in our supplier base.

We are working hard on all of these fronts. We have re-engaged our Sustainability Customer Council, with representatives across our businesses, to hear their candid feedback on our sustainability progress and emerging priorities. We have issued at the group level a Supplier Code of Conduct, which asks our suppliers to step up their commitments to us and our customers. We relaunched our eQ Calculator to provide our customers with the ability to assess the carbon footprint impact of their purchase decisions, and we’re committed to increasing transparency of our footprint reporting going forward.

Natural resource stewardship and advocacy

Sappi recognizes its responsibility to act as a steward of natural resources, so we promote sustainably managed forests, energy, soil, and water conservation, and clean air. We are in the process of setting new forward-looking five-year goals that will be tied to our capital and business plans. We are committed to reporting our sustainability progress publicly. These goals capture the key elements of our stewardship commitments to minimize waste, improve energy efficiency, and ensure we only source from low-risk forests. Many more measures are captured in our Key Performance Indicators section, also reported publicly.

Lastly, we recognize that our advocacy in the global business community counts. Sappi was an early supporter of the commitments reflected in the Paris Agreement on climate change, signing the pledge in 2015. Just this past year, we joined the Sustainable Apparel Coalition as well as supported the American Forest Foundation and GreenBlue’s Forests in Focus project, to add our voice to these critical initiatives measuring and influencing industry sustainability commitments.

Looking ahead

As the newly appointed President and CEO of Sappi North America, and on behalf of the organization, I would like to thank my predecessor Mark Gardner for providing us with the foundation of a strong, wellinvested company. I look forward to working with the full SNA team—including all the talented Matane employees who just joined us in November—to build our future. While the common benchmark of success is improved profitability and stronger financial returns, it is only through the continued support of our employees, suppliers, and communities that we will achieve our ultimate goal of providing the best solutions to meet the needs of our customers.

_{Mike Haws
President and Chief Executive Officer,
Sappi North America}

Read more from Sappi North America's 2019 Sustainability Report here.