Letter to stakeholders Communication on Progress (CoP) 2010 Methodological note
4 5 6
SOFIDEL GROUP: IDENTITY 1 SOFIDEL: AN ITALIAN GROUP WITH AN INTERNATIONAL VOCATION 1.1 In the tissue sector The tissue production process 1.2 History and evolution of the Sofidel Group 1.3 The Sofidel Group today 2 GIVING VALUE TO THE STRATEGY 3 GOVERNANCE AND RELATIONS WITH STAKEHOLDERS 3.1 Institutional structure of the Group 3.2 The new organisational model Projects relating to management of the new organization 3.3 Corporate responsibility governance model The Global Compact Recognition and awards 3.4 Sofidel Group stakeholders Initiatives to promote communication and dialogue with stakeholders
12 12 15 20 22 30 32 32 38 38 39 41 42 43 43
ECONOMIC DIMENSION OF SUSTAINABILITY 1 ECONOMIC SUSTAINABILITY POLICY 2 SIGNIFICANT OPERATIONAL DATA 2.1 Investments 3 PRODUCTION AND DISTRIBUTION OF VALUE ADDED
48 48 50 50
ENVIRONMENTAL DIMENSION OF SUSTAINABILITY 1 STRATEGY AND ORGANIZATION FOR ENVIRONMENTAL SUSTAINABILITY 2 SUSTAINABLE USE OF RESOURCES 2.1 Responsible purchasing of fibrous raw material 2.2 The rational use of energy resources 2.3 Water saving and conservation 3 THE QUALITY OF THE ENVIRONMENT 3.1 Struggle against the greenhouse effect Reduction in emissions of CO2 and Climate Savers The Emission Trading mechanism 2
54 54 54 57 60 62 62 62 64
3.2 Other impacts Emissions into water Waste management Other emissions into the atmosphere Transport Environmental Emergencies 4 ECOLOGY IN GROUP PRODUCTS 5 THE FIGURES ON ENVIRONMENTAL PLANT MANAGEMENT
65 65 68 69 69 70 70 72
SOCIAL DIMENSION OF SUSTAINABILITY 1 SOFIDEL AND HUMAN RESOURCES 1.1 Staffing make up 1.2 Industrial relations 1.3 Equal opportunities, diversity and non discrimination 1.4 Systems of pay and incentives 1.5 Training and staff development 1.6 Workplace health and safety 1.7 Communication and participation 2 SOFIDEL AND ITS CUSTOMERS 2.1 Sales channels and market trends 2.2 Sofidel Group products quality and safety 2.3 Customer satisfaction 2.4 Dialogue and communication with customers 3 SOFIDEL AND ITS SUPPLIERS 3.1 Supplier qualification and analysis 4 SOFIDEL AND THE COMMUNITY 4.1 Direct social contributions in the various areas of intervention The Giuseppe Lazzareschi Foundation 4.2 Activities aimed at the world of education and research 4.3 Relationships with local, national and international government institutions 4.4 Relationships with industrial associations, chamber of commerce, regulatory bodies
76 76 78 79 82 83 87 91 94 95 100 102 106 107 108 110 110 112 114 116 117
120 125 126
GRI table of contents Glossary
Letter to Stakeholders
â€œ2010 has once again been a year of growth and development for the Sofidel Group. â€? 2010 has once again been a year of growth and development for the Sofidel Group. The acquisition and start up of new companies abroad, the acquisition of important brand names and significant steps forward in the technical and organizational arena have served to create the conditions for a strengthening of our industrial and commercial muscle which today makes the Group the second biggest player in the European tissue sector. However, this growth in scale and international presence is only a part of the work which we are taking forward. Our investment in the future is increasingly driven by a precise idea of sustainable development, one which takes on board the social and environmental impact of our activities. Sofidel is working to integrate sustainability in our value creation process; to develop a lasting competitive advantage and to ensure positive fallout, in financial terms and in terms of social and environmental wellbeing, for the community within which we work; and to make our own contribution towards the development of a responsible economy and a better society and environment. During 2010 we have taken important steps forward on this route: in terms of sustainability governance, now organized and monitored in a similar way to every other strategically important sector of the Group; through the updating of the Ethical Code; the production of the sustainability Charter; membership of the Fondazione Sodalitas, the first organization in Italy to be involved in promoting corporate social responsibility; joining the Global Compact, the United Nations network which brings together institutions, enterprises and civil organizations from more than 130 countries, committed to promoting a culture of corporate citizenship and a sustainable and inclusive economy. This report bears witness to our work and aims to present it in a transparent and rigorous manner to our stakeholders. We are in fact convinced that companies should play a central role in encouraging sustainable growth. But we are also convinced that this objective may be credibly pursued only through a collective and global undertaking in which each part - enterprises together with institutions, organizations and citizens - makes its own contribution. Growth means taking on new responsibilities. It means taking account of the new opportunities available, but also of the associated responsibilities. In this spirit, and in the certainty that a significant and growing number of others share and support the same values and commitment, we present this report showing what we have done and what we are currently working on. Luigi Lazzareschi
Communication on Progress (CoP) 2010 In December 2010, the Sofidel Group, which considers a commitment to sustainable development and the promotion of dialogue with its stakeholders to be essential elements of responsible corporate management, joined the United Nations â€œGlobal Compactâ€? project. Membership of the Global Compact was engaged in by the Group as being consistent with the sentiments expressed in the Mission, the Ethical Code and the Sustainability Charter, formally approved under corporate governance arrangements, pursued through partnerships and cooperation agreements and implemented as a part of daily working life. The undertaking to promote and observe the Ten Principles set out in the Global Compact has now been confirmed with the drawing up of the first Communication on Progress (CoP) through which Sofidel intends to communicate the main actions taken and results obtained in terms of safeguarding human rights, protecting the environment and work, and the fight against corruption. Porcari, March 11, 2011 CEO Luigi Lazzareschi
This, the Sofidel Groupâ€™s third Sustainability Report (the second was issued in May 2010), gives further confirmation of our desire for a tool which enables us to report annually on our performance and the results obtained by companies within the Group in the financial, environmental and social field over the last three years. The Sustainability Report enables us to communicate in a far-reaching and transparent manner based on the principle of â€œaccountabilityâ€?. Since 2010 the Sofidel has been a member of the Global Compact. The Sustainability Report constitutes the Communication on Progress, that is, it describes the work undertaken by Sofidel to comply with the Ten Principles set out in the Global Compact in relation to human rights, working conditions, the environment and the fight against corruption. The guidelines used The contents of the Report have been drawn up on the basis of the Sustainability Reporting Guidelines (G3) made available under the Global Reporting Initiative (GRI) and in compliance with the reporting principles expressed therein, including that of prudence (Article 15 of the Rio Principles). In addition, reference has been made for methodological purposes to the guidelines for compiling the Social Report produced by the Social Reporting Study Group (G.B.S.) and AccountAbility 1000, the standard process produced by the ISEA (Institute of Social and Ethical Accountability). Within the different application levels identified and required by the GRI guidelines (shown in the figure) this Report has achieved application level A+ which corresponds to complete application of the guideline requirements and an independent external check (see page 6). The reporting process To produce the Sustainability Report the Sofidel Group set up an appropriate Reporting Team composed of various representatives from the main areas of the organization. The information was extracted from internal documents, the general accounts and financial statements for the year and from external sources: the most significant impacts have been taken into account and a specific system for identifying the required information developed to enable more systematic development of the process in future years and 6
to make it easier to verify and reconstruct the process for collecting and reporting data and information in accordance with the methodologies suggested by the standard. Further details and information on the activities of the Group are available on the website www.sofidel.it or by consulting other accountability documents such as the Environmental Statement, the financial statements for the year and the Consolidated Financial Statements. Report boundaries The reporting boundary for this Sustainability Report includes all the companies controlled by the lead company, Sofidel S.p.A. Where not otherwise specified, the reporting boundary does not include companies in the LPC group or the Romanian company Comceh, acquired during 2010, the report for which will be included in the next financial year; they are however included in the financial section to make comparison with financial statements easier. The reporting methodology is comparable with that used in the last financial year, except for the enlarged boundary as referred to above.
Third Party Checked
Report Externally Assured
Report Externally Assured
Report Application Levels
SGS Letter of Attestation
ASSURANCE STATEMENT CERTIFICATE FOR SOFIDEL GROUP SUSTAINABILITY REPORT 2010 SGS Italia S.p.A. has carried out an independent audit on the Sofidel Group Sustainability Report 2010. The information contained in the document is the sole responsibility of the Sofidel Group. SGS Italia S.p.A. has not been involved in any way in the preparation of the Report or in the process for collecting and processing the data contained therein. It is the responsibility of SGS Italia S.p.A. to assess the reliability and accuracy of the text, information, graphs and statements contained in the Report as part of the audit, the results of which are reported below, with the aim of informing all the Interested Parties. SGS ITALIA S.p.A. confirms that it is fully independent from the Sofidel Group and that there is no conflict of interest with the organization, its subsidiaries or the Interested Parties. Scope of the certificate The Report in question has been assessed in line with the Global Reporting Initiative Guidelines (GRI-G3) for Level A+. Methodology Our audit was conducted based on preliminary research, review of records and documents, interviews with staff and management and analysis of policies, procedures and practices adopted within the organization. The text, graphs and tables contained in the Report were audited by sample checking of qualitative and/or quantitative information in order to confirm their accuracy and track the process for collecting and summarizing the data. The audit team was chosen on the basis of the technical skills, experience and qualifications of each member, in relation to the different elements reviewed. The audit was carried out at the Headquarters of the Group and at some of the main Italian bases. The economic and financial data included in the Report correspond fully to the data contained in the Sofidel Group Financial Statements 2010, which have already been certified by the Financial Auditors. Conclusions On the basis of the audit work carried out, we hereby confirm the reliability and accuracy of the information contained in the Sustainability Report 2010, which represents a significant summary of the activities carried out by the Sofidel Group, as well as an essential instrument for communication with the Stakeholders.
GP5008 Issue 1
The principles of report definition and guaranteed quality of the information communicated have been complied with. We can therefore confirm that the applicable level A+ of GRI G3 has been achieved, with the following observations and improvement opportunities: PRINCIPLES We consider that the Sofidel Group Sustainability Report 2010 deals in a complete and transparent manner with the subjects considered to be â€œmaterialâ€? for the Organization and its Stakeholders. Involvement of Stakeholders has been further developed through the creation of new tools for communicating performance and the development of an internal communication campaign devoted to themes relating to sustainability. We would also underline the importance of the project for mapping and monitoring of suppliers, started in 2010, with the production of specific guidelines on sustainable management of the supply chain. INDICATORS: The audit team recommends that the Sofidel Group should continue to pursue the qualitative revision of the performance indicators and the extension of the reporting perimeter based on the new company structure.
Milan, 11 April 2011
SGS Italia S.p.A.
Stefano Bertoncini Systems & Services Certification Business Manager
Laura Verlicchi Systems & Services Certification Project Leader
SOFIDEL GROUP: IDENTITY
1 SOFIDEL: AN ITALIAN GROUP WITH AN INTERNATIONAL VOCATION
Germany Sweden Poland Spain France United Kingdom Rest of CEPI
20,1% 1.1 In the Tissue sector The companies in the Sofidel Group operate within a single reference context, the tissue paper sector (paper used to produce finished products for the kitchen, bathroom and for personal hygiene).
Italian tissue paper production (thousands of tons) source: ASSOCORTA 2009
1.451 1.370 1.319
5,1 6,9 20,7 10,6
Share of Tissue paper production in Europe (%)
Source CEPI 2010
11,1 20,1 11,2
6,6 MILLION TONNES
European production of paper for hygienic/ sanitary purposes (tissue) totalled in 2009
The tissue production process The production process for the products made by the Sofidel Group is based on working of raw materials, that is, pulp and recycled paper paste. To ensure that the timber used for paper production comes from sustainable sources, Sofidel has an evaluation and selection process for its suppliers which requires them to document the source of the timber used. The purchasing of raw materials involves a chain of companies which produce pulp mainly from scrap timber from sawmills or other industries or from logs from plantations and forests managed in a sustainable manner in accordance with the standards of the main certification schemes (see paragraph on â€œResponsible purchasing of fibrous raw materialâ€?). The first part of the primary production process takes part in the Groupâ€™s paper mills where the pulp paste purchased, or the paper mache, is melted in hot water, refined and then used in the machines for producing big reels of tissue paper (jumbo rolls or parent reels). The second part of the production process takes place downstream from the first part, in the paper converting plants, that is, the plants in which the parent reels are transformed into finished products and subsequently packaged and sold to the final customer through the various distribution channels. The paper industry has, in recent years, adopted environmental excellence initiatives to reduce water and energy use, atmospheric emissions and noise. Two important elements have contributed to this trend: the adoption by the paper sector of advanced and recognized environmental management tools such as ISO 14001 or EMAS and the birth of a complex legislative apparatus. It is in fact important to remember that the paper industry falls under the scope of EC directive 96/61/EC, better known as the IPPC (Integrated Pollution Prevention and Control) and 2003/87/EC which establishes the trading system for CO2 quotas known as Emission Trading. The coming together of these events has produced growth for the industry not only in terms of production but also in terms of knowledge and skills in the sustainability field.
Risks and opportunities in the Tissue sector under the three dimensions of sustainability
Environmental dimension • • • • • •
Source of and checks on raw materials Water supply Direct and indirect environmental impacts Climate change Logistics and transport Sustainable packaging(1)
(1) Sustainable packaging implies a quantitative and qualitative evaluation of packaging in order to reduce its environmental impact. (2) Sustainable purchasing means that particular care must be taken in choosing suppliers (qualification) to guarantee consumer safety. (3) Consumer safety, in addition to quality and hygiene, also requires accurate information and good communication. 16
Social dimension • • • • • • • •
Sustainable purchasing (source, quality etc.) (2) Integration with host territory Dialogue with institutions and trade unions Staff motivation and skills Managing diversity Workplace safety Good communication Consumer safety(3)
Economic dimension • • • • •
Availability of raw materials Transaction costs(4) Consumer satisfaction Production efficiency and cost saving (transport, work etc.) Financial risk management(5)
The new acquisitions, in particular those relating to the LPC group, require, as a result of their size and ethnic split, significant input to standardize the parameters of the new companies to the environmental, social and financial standards set by the Sofidel Group. (4) Transaction costs are those costs, whether quantifiable or not, which arise from trade, and reflect the effort made by the contracting parties to arrive at an agreement. The greater the trust between the parties, the lesser the transaction costs which must be borne. (5) The “financial risks” can be subdivided into credit risk, liquidity risk, risk of variation in financial flows and market risk, with the last being subdivided into exchange rate risk, interest rate risk and price risk.
1.2 History and evolution of the Sofidel Group The story of the Sofidel Group starts half way through the 60’s due to the determination of the two founders, Emi Stefani and Giuseppe Lazzareschi; over the years of subsequent growth, the Group has continued to pay constant attention to the sustainability of its actions.
2000 1999 Delicarta obtains the first ISO 9001 certification for the Group
Delitissue, the first Polish company in the group, is founded. The Fibrocellulosa (ITA) paper mill becomes part of the Group. Soffass obtains ISO 9001 certification The Delicarta paper mill obtains the first ISO 14001 certification for the Group
Production capacity reaches 140 thousand tonnes
1991 The first cogeneration plant, producing electricity and steam using natural gas, is installed in Delicarta
1993 The second cogeneration plant is installed in Delicarta.
1997 The Papernet converting plant is established and starts production of products for the service/industrial sector (Away from Home). The Sofidel Group enters the French market with Delipapier. A cogeneration plant is installed in Soffass. The performance bonus is instituted in the Delicarta paper mill and Fine Paper and in the Delicarta and Soffass converting plants in 1998
Sofidel is founded to coordinate the various companies and to provide services Delicarta substitutes natural gas for the fuels used previously (fuel oil and LPG)
1982 - 1987 Start up of the first continuous paper machines in the new Delicarta paper mill Soffass starts advertising the Regina Brand
The Delicarta converting plant is established and begins export of finished products.
The fourteenth monthly payment, though not obligatory under the work contract is gradually introduced in Fine Paper and subsequently in Soffass and Delicarta
1973-74 The first union meetings are held in Fine Paper and Soffass and an internal commission is established
1969 Founding of Fine Paper (production of double ply folded paper) The Fine Paper and Stefani & Lazzareschi are equipped with floaters, for the recovery of wood fibre (cellulose)
Founding of Stefani & Lazzareschi (production of single ply folded paper)
The Soffass converting plant is established. Fine Paper installs gas dried hoods instead of using steam (which is produced using fuel oil)
1970 The companies within the Group are among the founding members of a Consortium which brings together companies and municipalities to construct a biological cleaner for industrial and domestic waste from the municipalities of Capannori, Porcari and Lucca Delicarta joins the “Grune Punkt” (Green Point) consortium
2009 2008 The Sofidel Group acquires the Softis brand, the leading paper tissue brand in the German market. Intertissue Ireland (UK) completes its own liquidation Thuringerlogistik and Werra Hygiene (GER) complete a corporate merger. Delipapier GmbH (GER), Intertissue Paper Mill (UK) and Delipapier Buxeuil (FRA), obtain ISO 9001 certification Delicarta paper mill and Delipapier Nancy, (FRA) obtain OHSAS 18001 certification Monfalcone paper mill obtains ISO 14001 certification
2007 The acquisition of the Werra Group (GER) enables production capacity of 683 thousand tonnes to be reached. The Imbalpaper cogeneration plant is entirely rebuilt with a more efficient gas motor Papernet obtains BRC certification Intertissue (UK) obtains FSC certification The Sofidel Group produces its Ethical Code Ibertissue (SPA) obtains ISO 9001 certification Delipapier GmbH (GER) obtains the NSL License
The acquisition of Papyros (GRE) gives access to a strategically important area for the development of the Group’s business In December 2009 the Sofidel Group acquires the Le Trèfle and Sopalin brands. The Le Trèfle brand, around for more than 100 years, is one of the most historic brands on the tissue product scene. A range of toilet papers found in the majority of French retailers are now marketed under the Le Trèfle brand name. In Delicarta 4600 sq m of photovoltaic panels are installed. In Soffass 7500 sq m of photovoltaic panels are installed and the MCA covering removed. Sofidel obtains the PEFC chain of custody, multi-site certification for Sofidel, Delicarta paper mill and Delicarta converting plant, Delipapier (FRA) and Delipapier GmbH (GER) Soffass converting plant and Ibertissue obtain BRC certification Papernet, Soffass converting plant and Intertissue (UK) obtain OHSAS 18001 certification Intertissue (UK) obtains ISO 14001 certification As part of the renewal of the employment contracts for Papernet, Soffass converting plant and Imbalpaper the Observatory on “Safe Conduct” is inserted in order to highlight behaviour which is out of line with safety principles and rules by identifying non conformities and at the same time highlighting and praising virtuous conduct which is continued over time
2006 With the acquisition of the Delipapier Buxeuil (FRA) converting plant and a series of production start ups the Group increases its production capacity to 583 thousand tonnes. Monfalcone paper mill and Delitissue (POL) obtain ISO 9001 certification Delicarta paper mill obtains EMAS registration Delicarta converting plant obtains SA 8000 certification Imbalpaper obtains ISO 14001 certification
2001 Soffass paper mill and converting plant is formed from the merger of Soffass and Fine Paper Sofidel becomes the Group holding company Papernet obtains ISO 9001 certification
2002 The Monfalcone paper mill (ITA) becomes part of the Group Delicarta obtains the ECOLABEL mark for its products. Delicarta and Soffass obtain FSC certification
2004 The Sofidel Group enters the important German market with Delipapier GmbH and Delisoft (GER). The Sofidel Group enters the Spanish market with Ibertissue (SPA). Sofidel Kagit is established following acquisition of the tissue division of Dentas Kagit in Turkey Soffass paper mill obtains ISO 14001 certification
2010 The first few months of 2010 saw the birth in Croatia of Sofidel Papir (HR), a new company based in Zagreb formed with the purpose of coordinating and standardizing sales polices in the Balkan area (Croatia, Slovenia, Serbia, Montenegro, Macedonia and Albania) In May 2010, through its Polish subsidiary, Delitissue, the Group acquired 29.93% of the capital in Comceh (RO), one of the leading Romanian companies in the paper industry. Situated between Bucharest and Constanta, close to the Bulgarian border, it is in an ideal position to supply the countries of South Eastern Europe. In June 2010 Sofidel acquired LPC Group, based in Leicester (GB) and with working factories in four European countries (in addition to GB, Sweden, Belgium and France). LPC has a production capacity of 190,000 tonnes. Thanks to this acquisition the Sofidel Group has become the second biggest European player. In November the Group, through its Polish subsidiary, took control of Comceh by acquiring 70% of the authorized capital. This was the culmination of the operation started in the Spring. In February Sofidel joined the Fondazione Sodalitas, the first organization in Italy involved in promoting corporate social responsibility and dialogue between enterprises and not for profit organizations. In February the Fibrocellulosa plant was certified OHSAS 18001 In March 2010 the Group adopted the “Charter for equal opportunities and treatment at the workplace”. This is a voluntary statement of intent, signed by enterprises of all sizes, on the rolling out of an inclusive corporate culture and human resources policies which are free of discrimination and prejudice and reward and value talent in all its diverse forms. The Charter is promoted by the Fondazione Sodalitas In Fibrocellulosa the 300 KW hydroelectric plant powered by a water turbine was completed with the start up phase timed for the end of the year In Delitissue a cogeneration plant with a new generation gas turbine was constructed which is able to cover almost the entire energy requirement and contribute to the remote heating of the town, thus allowing a reduction in emissions of 15,900 tonnes/year Sofidel Italia took part in “Earth Hour”, the global event whereby the WWF each year invites millions of people, companies, organizations and administrations in the world to turn off the lights for an hour as a symbolic gesture to remind the Earth’s leaders to reach a global, effective and true climate agreement following the disappointing outcome of the Copenhagen summit. Sofidel took part by promoting the Earth Hour messages through its website and turning off the luminous signs in its Italian plants In December the Sofidel Group became a member of the United Nations Global Compact, a multi-stakeholder network which brings together governments, enterprises, United Nations agencies, trade unions and civil bodies with the aim of promoting on global scale the culture of corporate citizenship In December Sofidel drew up its Sustainability Charter detailing its guiding principles, main partners and fundamental commitments in terms of corporate social responsibility Sofidel revised and updated its Ethical Code based on current regulations and standards.
2005 Imbalpaper and Intertissue converting plant (UK) obtain ISO 9001 certification Delipapier Nancy (FRA) obtains ISO 14001 and FSC certification
Imbalpaper (ITA) becomes part of the Group, enriching the Service/Industrial (Away from Home or AFH) Sector Intertissue (UK), the first English company in the group, is established Delipapier Nancy (FRA) obtains ISO 9001 certification
1.3 The Sofidel Group today The Sofidel Group, founded with Italian capital, is one of the main European producers of tissue paper for sanitary and household use.
With over 40 years of experience, 27 production sites and 22 company organizations spread over 12 countries - Italy, Spain, Sweden, the United Kingdom, Belgium, France, Croatia, Germany, Poland, Romania, Greece and Turkey - and more than 4500 employees, the Sofidel Group occupies second place in Europe in terms of production capacity within the tissue sector (954,000 tonnes a year, data from EU Consulting, July 2010). Close attention to people and to the wider community, a commitment to innovation, quality production and processes, transparency and the adoption of socially and environmentally responsible behaviour are key features of the value creation process within the Group. 2010 was marked by a significant expansion which saw the Group move forward on two important fronts: development in South East Europe and consolidation in North Europe. The acquisition of Comceh in Romania, the coming on line of the first converting line in the Papyros plant in Greece and the opening of the trading company SOFIDEL Papir in Croatia have strengthened the presidium â€“ also taking into account Delitissue in Poland, the Monfalcone paper mill in North-East Italy and Sofidel Kagit in Turkey â€“ at the service of a vast area of considerable interest, which runs from Croatia to Turkey and from Slovakia to Greece. The acquisition of Lpc France, Lpc Belgium, Lpc UK and Swedish Tissue instead served to strengthen production and sales capacity in Northern Europe, within or immediately adjacent to important markets such as the French, English and German ones. This reflects a strategy based on three fundamental principles: an exclusive commitment to the tissue sector, use of modern high performance plant and distribution of our production sites on a European basis, close to the markets, to contain logistic costs and increase service quality. Thanks to these acquisitions the Sofidel Group is now the second biggest European player in terms of productivity within the tissue sector. The Group is now managing the delicate phase of integrating the new production sites, which differ in terms of history, size, culture, ethnic make-up and technological and organizational development. The changeover is particularly demanding in relation to the companies previously owned by LPC. The LPC Group, at the time it became part of the group, had 7 plants in four European nations (France, the United Kingdom, Belgium and Sweden), a production capacity of about 190,000 tonnes a year of paper for household use and about 1,120 employees. It is the leader in the private label business in Great Britain, a country in which the vast majority of employees are of Indian origin. The Romanian company Comceh, based in Calarasi, in the South of Romania, produces and sells tissue products. At the time of its acquisition by Sofidel it owned an integrated plant (paper mill and converting plant) with a production capacity of about 35,000 tonnes a year. It has 260 employees. Its main brand names include: Volare and Onda. Among the big organized retail distribution networks (private label) Comceh has relationships with, among others, with Metro, Kaufland and Carrefour. Comceh is located in a strategic position, between Bucharest and Constanta, close to the Bulgarian border, perfect for serving the countries of South East Europe.
European Tissue Market
Sofidel Papir, based in Zagreb, is a trading company, a commercial company founded with the purpose of bringing the Sofidel Group even closer to the Balkan markets. Sofidel Papir currently manages customers and sales for the Regina brand only in the following countries: Croatia, Slovenia, Albania, Bosnia, Montenegro, Macedonia and Serbia. In addition to aspects linked to expansion, the Sofidel Group has pursued its working commitment to organizational adaptation and optimization and growth
WEPA Group METSĂ„ Tissue
M. C Tissue SHP Group
Fonte: Sofidel EU consulting - 20/01/2011- Migliaia di tonnellate
within the framework of corporate social responsibility, two levers considered fundamental for generating a lasting competitive advantage and benefits for the community.
COUNTRIES IN EUROPE
YEARS OF HISTORY
Today the Sofidel Group, which through its holding company Sofidel S.p.A. owns, directly or indirectly, all the controlled companies, is present in numerous European countries with: PAPER MILLS (production of reels) CONVERTING PLANTS (transformation of finished products) INTEGRATED PLANTS (a development of the traditional paper industry, that is, paper mill and converting plant together). In addition the Group owns SERVICE COMPANIES, that is, companies which provide services both in support of other companies and for third parties and TRADING COMPANIES, that is, companies which market both finished products and parent reels within domestic markets.
PL DE BE FR RO HR
The Sofidel Group is constantly growing in size, both in terms of turnover, number of plants and employees. In 2010, with the acquisition of the LPC group, the Romanian company Comceh and the start up of the trading company Sofidel Papir in Croatia, the Group further consolidated and developed its presence throughout the whole of Europe.
Sofidel Consolidated Turnover
Estimation Sofidel + Comceh S.A. + LPC Group Source: Sofidel - Consolidated Turnover - Million â‚Ź
664 608 3.136 3.008
Source: Sofidel 31/12/2010
1.464 1.266 1.076
* The 2010 figures include figures for the companies within the LPC group and the Romanian company Comceh.
The Sofidel Group, through its integrated cycle which goes from production of jumbo rolls of tissue paper to their transformation into finished products, feeds the following four lines of business: BRAND i.e. products for household use such as toilet paper, kitchen roll, napkins and facial tissues. • Regina, the reference brand in the Italian and Polish markets, now also being developed in other markets such as France, Switzerland, England, Germany and various countries in Eastern Europe; • Softis, the leading brand in terms of facial tissue/handkerchiefs in the German market and of primary importance in the Austrian market; • Soft & Easy and Yumy, other brands on offer in Poland and Turkey; • Le Trèfle, one of the most historic toilet paper brands in the French market; • Sopalin, long lived French brand of paper for household use (kitchen paper); • Volare and Onda, two brands whose recent acquisition has also allowed the Group to assume a leadership position in the Romanian market. PRIVATE LABEL i.e. products destined for families, but marketed for third parties under the labels of the large scale retail distribution chains or other Group brands (Nicky, Valenty, Florex, Daily, Temis, Tyril, It’s magic). AWAY FROM HOME which covers industrial/service sectors involving use of the product outside the house, for example by hotels, restaurants, environmental and community cleaning, service stations, public bodies, which use finished products such as large size kitchen roll, medical bed sheets, folded hand towels, jumbo rolls of toilet paper, interleaved toilet paper, facial tissues and other, mainly brand and to a lesser extent third party labels. PARENT REELS (Jumbo rolls), that is, sale of semi-finished products when not used for internal manufacturing.
2 GIVING VALUE TO THE STRATEGY
For the Sofidel Group, lasting economic growth is impossible without taking into account the need to integrate development and improvement of the quality of life of employees and of the community within which the enterprise operates, as well as safeguarding and promotion of the environment. A corporate strategy which finds in sustainability a lever for growth, development and innovation, fundamental for the creation of lasting added value. These, in summary, are the main strategies pursued by the Sofidel Group:
1. Expansion and internationalization of the business 2. Innovation oriented towards social and environmental sustainability 3. Valuing and developing staff 4. Consumer protection and building consumer loyalty and trust 5. Integration with the territory In accordance with all this the Group has the following mission: “To make daily life tidier, cleaner,
safer and more pleasant, through valuing people, innovation and conduct inspired by the principles of sustainability, commercial transparency and respect for rules with the aim of creating value for customers, employees, partners, shareholders and the wider community”. All of which is in line with the values and principles established by the Sofidel Group in its “Ethical Code”. This contains the guidelines concerning the rights and duties of everyone who, in whatever guise, takes part in the life of the organization. The values which underlie the ethical conduct of the Group: responsibility, professionalism, transparency, sobriety, honesty, correctness, confidentiality, impartiality, humility, loyalty, mutual respect and sharing. The Group has updated and revised this fundamental tool. Sofidel has also formalized these principles and values by signing the “Charter for Equal Opportunities and Treatment at the Workplace” (see relevant paragraph “Equal opportunities, diversity and non discrimination”). Today it is not sufficient to produce quality products. A company is also valued by the market, the institutions and public opinion based on how it produces. Within this context, Sofidel has made sustainable development one of the strategic and qualifying levers of its growth and for this purpose drew up during 2010 its own “Sustainability Charter”, which details the underlying principles and identifies the main actors and fundamental commitments in terms of corporate social responsibility. The Charter has been rolled out within all the companies in the Group and may be downloaded from the site www.sofidel.it. 30
OUR IDENTITY CARD
On a more strictly operational level the Group is working on a Sustainable Development Plan which will describe the strategic priorities in terms of sustainability and the pathway to be followed in terms of pursuing economic, social and environmental growth, with the aim of fully integrating corporate social responsibility within the Companyâ€™s value creation process. Making sustainability a part of our way of working and incorporating it in our relationships with our partners, suppliers and customers is the path which Sofidel has chosen to follow, in synthesis with the history of the Group, which has always paid close attention to the social and environmental impact of its operations. 31
3 GOVERNANCE AND RELATIONS WITH STAKEHOLDERS 3.1 Institutional structure of the Group
Thüringer Logistik GER
The holding company Sofidel S.p.A., owned by the founding families Stefani and Lazzareschi, directly and indirectly controls all the companies in the Sofidel Group.
100% Werra Papier GER
Werra Holding GER
Thüringer Papier GER
Omega Papier GER
THE CURRENT BOARD OF DIRECTORS OF SOFIDEL S.p.A Luigi Lazzareschi Emi Stefani Edilio Stefani Lorenza Magazzini Cristina Lazzareschi Paola Stefani
CEO Chairman Board member Board member Board member Board member
Sofidel is governed by a Board of Directors (BoD) elected by the General Shareholders’ Meeting and composed of members of the controlling families, which: • defines the general guidelines and assigns the objectives to be achieved by each individual controlled company; • evaluates and approves the strategies proposed by the controlled companies; • monitors implementation of the strategy approved by each controlled company and the results achieved; • provides for central management of the functions of individual controlled companies where significant synergies exist between them. The members of the Board of Directors reflect the shareholders, are all executive and non independent, and have the required skills for the responsible management of the business in line with sustainable development objectives. The directors assume full responsibility for the financial, social and environmental 32
Cartiera di Monfalcone ITA Delicarta ITA
Sofidel Kagit Turkey
30% Own Shares
1% Swedish Tissue AB
Sofidel 99,96 % Delicarta 0,01% Soffass 0,01% Papernet 0,01% Imbalpaper 0,01%
Delitissue 99,7636 % Others 0,2364%
Delipapier Gmbh GER
Sofidel Kagit TUR
100% Papyros GRE
Kamns Paper Mill LTD UK
LPC UK LTD UK
LPC Produits Papier FRA
100% Sofidel Papir CRO
99,7% LPC Group PLC UK
Source: Sofidel November 25, 2010
Styx Back Office LTD INDIA Swedish Tissue AB SWE
LPC Properties FRA
LPC Holding FRA
3 years 23 Remit of the current Board of Directors
Board meetings during 2010
performance of the Group, which is subject to approval by the Shareholders’ General Meeting on an annual basis. The CEO also assigns management roles, taking into account the qualifications and skills needed to implement sustainable strategies. The current Board of Directors has been in post since 27/02/2009 and has a three year mandate. During 2010 the Board of Directors met 23 times. At the moment there are no formal channels through which employees can send recommendations to the Board of Directors, but the constant presence of the Chairman and the CEO within the companies of the Group nevertheless allows for good interaction with the personnel. The Board of Directors of Sofidel S.p.A is supported by the Board of Auditors, composed of professionals and university academics, to whom control of the administration of the company is delegated as well as all the other duties provided for by the Civil Code. The Consolidated Financial Statements, approved by the General Meeting, are certified by the Reconta Ernst & Young firm of auditors. Business control The Sofidel Group, also taking into account the EC regulations relating to “administrative liability of legal persons (converted into law in Italy by D.L no. 231/2001 and subsequent amendments and additions) has set up, under the economic-financial part, a suitable corporate organizational unit known as “Business Control” which has developed an appropriate risk management methodology. This unit, by analysing the various processes involved, is responsible for identifying problem areas and defining rules of conduct, with a view to integration with other relevant corporate functions and prevention of the crimes considered in the aforementioned regulations. This preventive control is also useful in terms of defining the responsibility framework. In terms of work hygiene and safety, compliance with the principles and precepts in the aforementioned international standard is subject to the adoption of a special and suitable organizational model, deriving from the implementation, in the various Group plants, of OHSAS 18001 certification. This international standard constitutes a valid management and control tool for ensuring compliance with the regulations aimed at protecting the health and safety of employees, while checking of the implementation of the required preventive controls is entrusted both to internal control bodies using appropriate audit techniques and to external auditors from the Certification Bodies through regular inspections. In detail, the Business Control function: • has carried out, in cooperation with Supply Chain – R&D Management, the mapping within the Sofidel Group companies of the “transport” process in order to identify existing problems and control points. • has continued, in cooperation with the Vice Chief Operating Officer, the mapping within Sofidel Group 34
companies of the process for “Management of purchases and storage of spare parts” • has analysed and monitored, with the help of the Chief Marketing & Sales Officer, the “Marketing” flow for parent reels, in order to identify any existing problems and to implement appropriate action plans to resolve these (including the implementation of standard triangulation for the paper mill). In addition, a study has been started of the “Marketing” flow for finished products and “Promotions” for Sofidel Group companies. • has begun analysis of the “Management of credit cards and prepaid cards”, “Management of fuel cards” and “Management of company machinery” and has supported the various Managers in the compilation of action plans for the management of projects such as: - implementation on SAP of recently acquired companies - closure of inter year financial accounts - implementation of the management procedures for SAP R3 users - development of the Inter company Reconciliation procedure - management of various process problems • carries out monthly checks on the inter company reconciliation and regularly calculates indicators for the monitoring of promotional costs, insurance cover for the warehouses, delays in recording on SAP of goods received and delays in recording on SAP of tax documents • has supported, in relation to process checks, the various Management Units in identifying and calculating indicators for checking “Management of purchase and storage of spare parts” and “Management of tax documents”. The Sofidel Group guarantees that in its management of the business it does not resort to illegal or corrupt practices and does not offer, directly or indirectly, sums of money or other favours in order to procure or secure any improper advantage. Violations by Sofidel Group employees of these basic principles of the Group’s Ethical Code are not tolerated and may be subject to disciplinary action of various types and scale, in proportion to the seriousness of the infraction committed. It is worth highlighting that in 2010 330 hours of training were given on the principles and values set out in the Ethical Code. Up until the end of the 2010 financial year no cases of corruption were identified.
3.2 The new organisational model In July 2009, the Sofidel Group completed its restructuring of the corporate macro structure. The new organization is the result of a complex project started in 2008 which has involved the main corporate management of the Group, both in Italy and abroad. The need for change was born from the need to adapt the organization of the Group to its rapid evolution and to the altered needs of its customers. The organizational design is characterized by the following four groupings: 1. Production and Technical Area 2. Marketing and Sales 3. Global Function: area of linkage between the two areas above 4. Service Centre: staff functions In the course of 2010 we have continued with the implementation of the new organization structure, that is: • analysis of the posts available in the company • rationalization and harmonization of posts • publication of the corporate structure • alignment of the Job Descriptions to the rationalized posts • distribution of the Job Descriptions • study of the corporate macro-processes and compilation of new procedures Projects relating to management of the new organization With the approval of the new organizational macro-structure of the Group, an “Organizational Structures and Processes” organizational unit has been created within the Human Resources, Organization and Safety Department with the task of ensuring efficient and effective management of the organization for the whole Group. In 2010, progress was made on a number of significant projects aimed at creating a solid basis for the development of the organizational unit. Mapping of jobs, alignment of definitions at Group level In strict connection with the other activities linked to the organizational model, a project has been developed to map existing posts within Group companies The jobs identified have been analysed and rationalized so as to create a definitive list, common to and shared by the whole Group. In parallel the definition of the various jobs has been aligned with the objective of ensuring real homogeneity throughout the whole structure. Organizational structure Given the new jobs map, it has proved necessary to draw up and publicize the new organizational structure of the Group. The official document was made public in August 2010 in two versions, with different aims. The first version highlights the organizational units needed for company operation. The second version instead covers all the (white collar) employees of the Group. These documents are now public documents and available to all employees on the company network.
The organizational manual The organizational manual is set up as a tool which provides a description of every single job in the company organization. During 2010, the document was aligned with the jobs resulting from the study referred to above. The first version of the organizational manual, containing the job descriptions for the different posts, was distributed in the course of 2010. The first revision is currently being produced and will be distributed in the course of 2011. Organizational analysis Following the aforementioned projects, it has been possible to undertake a detailed organizational analysis for the entire Group. The results of this analysis will be discussed and implemented during 2011 with the aim of optimizing the structures throughout the Group as well as the main processes. During 2011 a detailed analysis will also be made of new and future acquisitions. New procedures Based on the current organizational changes, it has become necessary to implement the “operating models” outlined in the new model which has been adopted. Review and optimization of the main corporate processes, in accordance with the new “roles” and “responsibilities” of the new functions will be an important lever for organizational change and strategy implementation.
3.3 Corporate Responsibility Governance Model The Sofidel Group has taken on Corporate Social Responsibility (CSR) as the strategic direction for its own sustainable development and has equipped itself with a specific system of governance, aimed at transversally integrating strategic levels with operating ones in all areas and companies of the Group. Within this framework CSR is now organized and monitored in a similar manner to every other sector of strategic importance to the Group. The Board of Directors of Sofidel exercises its function of directing and controlling CSR through the CEO who, in turn, refers to the Corporate Social Responsibility Director, coordinator of the Corporate Social Responsibility Committee (CSR Committee) which all those reporting directly to the CEO take part in. The CSR Committee, working in line with the policies defined by the Board of Directors, has the following aims: • to produce plans and operating programmes for work designed to adapt internal systems and corporate policies to meet the international CSR standards; • to ensure ever greater coordination of the various corporate areas to enable CSR to permeate the entire organizational culture; • to define the Sustainable Development Plan for the Group and an annual plan containing CSR improvement targets; • to activate and develop a structured system for engagement and dialogue with stakeholders. Since 2010, the CSR Committee has been flanked by the CSR Reporting Team which, in addition to the annual compilation and publication of the Sustainability Report, has the task of putting the policies and 39
CSR Team Reporting CSR Local Committe
CSR Local Committe
Comitato CSR CSR Director
choices adopted by the CSR Committee into operation. The Reporting Team is coordinated by the CSR Manager who also liaises with the CSR Committee and those outside the Group. During 2010, a CSR Local Committee was formed in each foreign company within the Group with the task of keeping partners and stakeholders informed, monitoring and ensuring application of the values and principles shared by the Group, ensuring a more timely and comprehensive flow of information to the corporate centre for the reporting process, promoting training activities and supporting the verification activities of the certification bodies in the company units across the various countries. Each CSR Local Committee is composed of: the Country Operation Manager, Human Resource Manager, Environmental Manager, Quality Manager, Purchasing Manager, Administration Manager and Country Sales Managers. The HR Manager acts as the coordinator for each committee, in his/her capacity as the local CSR contact. He/she liaises constantly on operational aspects with the CSR Reporting Team, while for aspects of a strategic nature, he/she works through the Country Operation Manager, reporting directly to the CSR Manager. In the course of 2010 the CSR Reporting Team has held 5 sessions. The CSR Committee has met twice. In February 2010 Sofidel joined the Fondazione Sodalitas, the first organization in Italy to be involved in promoting corporate social responsibility and dialogue between enterprises and not for profit organizations. Founded as an association in 1995, on the initiative of Assolombarda, today the Fondazione Sodalitas, which officially represents CSR Europe in Italy, brings together 75 enterprises (including UniCredit, Monte dei Paschi di Siena, Pirelli, Siemens, Telecom, Vodafone, Eni, Enelâ€Ś) which work on strengthening social cohesion, taking action in three main areas: the world of enterprise, no profit organizations and youth.
Number of companies in the Fondazione Sodalitas
THE GLOBAL COMPACT At the end of the year the Sofidel Group joined the United Nations Global Compact, a multistakeholder network which brings together governments, enterprises, United Nations agencies, trade unions and civil bodies with the aim of promoting the culture of corporate citizenship on a global scale. The basic idea of the “global pact” is that enterprises with a long-term strategic vision directed towards social responsibility can contribute to a new phase of globalization characterized by sustainability, international cooperation and partnership within a multi-stakeholder context. Sofidel’s membership and support for this international partnership goes side by side with the Group’s everyday commitment to giving concrete application to the 10 principles of the Global Compact within its corporate activities.
GLOBAL COMPACT PRINCIPLES Framework
To promote and respect universally recognized human rights within the framework of the respective spheres of influence. Ensure that there is no, even indirect, complicity in human rights abuses
Ethical Code Charter for Equal Opportunities Guidelines for sustainable management of the supply chain Sustainability Charter
Support freedom of association for workers and recognize the right to collective bargaining Support the elimination of all forms of forced or compulsory labour Support the effective elimination of child labour Support the elimination of every form of employment and professional discrimination
Ethical Code Personnel policies Charter for Equal Opportunities Guidelines for sustainable management of the supply chain
A preventative approach to environmental challenges Undertake initiatives which encourage increased environmental responsibility Encourage the development and diffusion of technologies which respect the environment
Joining the international WWF CLIMATE SAVERS programme to reduce emissions of CO2 Application of the best environmental techniques Application of the environmental standards Careful choice of suppliers Ethical Code Sustainability Charter
To combat corruption in all its forms, including extortion and bribery
Ethical Code Relevant corporate structure: “Business control”
Recognition and awards The numerous forms of recognition and awards which the Sofidel Group has received in 2010 thanks to its commitment to responsible management provide encouragement for the pursuit of our chosen path:
Target Zero Safety Project: The Sofidel Group in Italy takes part in the Target Zero project promoted by the Fondazione Giuseppe Lazzareschi (see paragraph on “The Giuseppe Lazzareschi Foundation”). Also during 2010 various forms of recognition, both for the achievement of Target Zero objectives by Fibrocellulosa and for the reduction in accidents and accident indices, have been awarded to various Sofidel Group companies in Italy. The “More for Zero” competition was won by the Sofidel Group with the “Safe Idea” initiative, described below.
Safe Idea Award: In November 2009, for the Italian companies in the Group, an innovation competition was introduced whereby employees are invited to draw up proposals to improve Health and Safety at the workplace : “Safe Idea”. The jury, composed of institutional bodies (INAIL, ISPESL and provincial supervisory bodies) has awarded a prize for the most innovative idea and the one closest to the principles of safeguarding Health and Safety during the ceremony which was held in the Sofidel headquarters on 20 May 2010 in the presence of the CEO. The prize was a trip to Venice. 80 employees took part in 2009/2010. In line with the guiding principles and values of the Sofidel Group in relation to Health and Safety and based on the success of the first year, the prize was advertised again in 2010/2011 using the same method as the previous year, but with a more capillary roll out and communication of the initiative. Tuscany Ecoefficiency Award: The “Toscana Ecoefficiente” (Ecoefficient Tuscany) award is based on an invitation to report good environmental practices and actions which the Tuscan Regional Government sends to all entities which have carried out real innovation in terms of processes, systems, technology and products from the viewpoint of ecological efficiency, sustainable development, sharing of good environmental practice, respect for ethical-social aspects, quality and sustainability of community life. For 2010 the Award for Excellence (the most prestigious awarded on this occasion) went to Sofidel, for its work on reducing greenhouse gas emissions, with particular reference to the photovoltaic plant installed at the Delicarta paper mill plant, Papernet, Soffass converting plant and Delicarta converting plant. Report Oscar 2010: the Sofidel Group has been selected among the finalists for the award promoted and managed by FERPI - Federazione Relazioni Pubbliche Italiana (Italian Public Relations Federation) – aimed at those organizations which “have demonstrated with their report that they desire and know how to communicate not only financial results, but also the social and environmental performance of their organizations”. Sofidel distinguished itself in the category “Reports for Large Unquoted Companies” together with Cpl Concordia Società Cooperativa and the pharmaceutical company Roche Spa – which was awarded the prize - for “reports which succeed in giving an account of the mission and profile of the company and illustrating specific angles such as research activities”. 42
3.4 Sofidel Group Stakeholders A corporate group like Sofidel has to consider the needs and expectations of a multiplicity of stakeholders, who sometimes have a diverse range of interests. Responsible management, which this report reflects, means careful attention, within corporate decision making, to all the legitimate expectations of the various categories of stakeholders, balanced and integrated within corporate strategies. The Sofidel Group has thus carried out a preliminary mapping of its main stakeholders. The main stakeholders of the Group are: the consumers who each day choose and appreciate our products; the customers, who offer us their loyalty; the environment, which provides us with essential resources; our personnel, who, with their professionalism and dedication are the engine house of the company; the suppliers, with their contribution to the high level of quality and innovation; the community, with its cultural, social and economic heritage; the shareholders and financial partners who invest in the company; the public institutions, essential partners in the regulation and development of the company and the market; the workers representatives who together with company representatives, in respect for their mutual independence and in a spirit of cooperation, promote the fruitful involvement of workers and contribute to an effective social dialogue and relationship of trust within the company; the media, who play a fundamental role in the transmission of information, the spreading of news and the delicate process of forming public opinion; the research centres and universities which, as well as being privileged places for the development and diffusion of science and culture, are potential accelerators of business transformation; the world of the associations and not for profit organizations, rich in ideas and valuebased stimuli; and our competitors, who are a constant stimulus for our growth. All our current and future stakeholders, and the complex network of relationships which link them to us, constitute an added value: an integrated and transversal system which can help us to be what we want to be. Initiatives to promote communication and dialogue with stakeholders Being aware of the importance of communication with stakeholders, the Group has continued, through the various initiatives reported below, to implement this process of integration and sharing. The sending to our external stakeholders of our Sustainability Report, produced in Italian and English.
The Report has been made available on line on our web site www.sofidel.it so that it can be consulted and downloaded by all. Publication of the Summary Sustainability Report in all the languages of the Group and its distribution to all Group employees. This has proved a useful tool in terms of supporting relations with the outside world - almost a visiting card - and helping our stakeholders to become more familiar with the world of Sofidel. This document has also been made available on line on our web site www.sofidel.it. Realization of an institutional communication campaign devoted to the partnership with the WWF as part of the international Climate Savers programme aimed at voluntary and certified reductions in emissions of Co2. The campaign was rolled out both internally, in all the Groupâ€™s bases, using e-mail and posters and externally, though advertising and trade fairs. 2010 saw the first issue of â€œSoft & Greenâ€?, the Sofidel Group newsletter devoted to sustainability. A simple publication produced in two languages (Italian and English) and in digital and paper format, which aims to summarize and make known to our many external stakeholders some of the main news in relation to the life of the Group, with particular attention to the social and environmental aspects of our business. A sign of our attention to our stakeholders (customers, suppliers, public institutions, associations, the community, financial partners) with whom we are constantly working to construct and maintain long lasting and cooperative relationships. 44
There has been a restyling di People & Paper, the periodic publication of the Group, translated into 11 languages and distributed to all employees. A more attractive graphical vest and easier reading style has been introduced to help with the communication of information and news. There has been a restyling of Working Safely Together (WST), the periodic publication of the Group devoted to the subject and culture of health and safety. Also involving renewal of the graphical vest and increased harmonization with other communication tools of the Group (see paragraph on “Workplace health and safety”). Sofidel Informa / Sofidel News This involves simple internal communications of an informative nature via e-mail, in Italian and English, used to spread individual pieces of news or information about specific events in “real time” to all the companies in the Group. A specific internet forum devoted to safety has been set up. This tool has been created in order to roll out through the Sofidel Group Health and Safety initiatives, good practice, accident statistics and other relevant publications. The new Sofidel web site has been developed. The project pursued the following objectives: simplification and rationalization of the architecture and contents; improved legibility; strengthening of corporate identity through increased harmonization, integration and uniformity with respect to other communication tools already in use; giving more prominence to Corporate Social Responsibility with the change in position of the “Sustainability” heading to the main menu and the creation of a single page in this menu highlighting membership of the Climate Savers programme; creating the possibility for users to download all our publications (People & Paper, Working Safely Together, Sustainability Report, Charter for Equal Opportunities); design of an accessible site (W3CA) which allows the site to be viewed more easily by the vision impaired and allows easier reading for the screen-readers used by the blind.
ine of Sofidel Group
The in-house magaz
DELITISSUE POLAND CUTTING CO2
LA CARTA DELLA
RADICI E OBIETTIVI
Integrare la sostenibilità nel nostro modo di lavorare e nelle relazioni con la storia del nostro con tutti i nostri interlocutori, Gruppo, da sempre attento all’impatto patrimonio di valori è il percorso che abbiamo sociale e ambientale espresso e vissuto dalle deciso di compiere, del suo operare. Noi nostre aziende, una in sintonia processo di apprendiment crediamo, infatti, che, visione etica e una o e miglioramento coerentemente con gestione responsabile continuo capace di sviluppo e quello delle il grande dell’impresa rendere sempre più comunità in cui siamo economicamente, socialmente consentano l’attivazione di un virtuoso presenti. e ambientalmente sostenibile il nostro LA NOSTRA MISSION
Forti di questa storia e di queste convinzioni la nostra Mission, forza “Rendere più ordinata, motrice del nostro quotidiano agire, ci pulita, pratica, sicura chiama a: e piacevole la vita ispirati alla sostenibilità, quotidiana, attraverso alla la valorizzazione del gli azionisti e la comunità.” trasparenza commerciale ed al rispetto personale, l’innovazione delle regole, con lo , i comportamenti scopo di creare valore per i clienti, i dipendenti, i partner,
I NOSTRI PRINCIPI
Nel concreto operare quotidiano ciò significa guardare a tutti gli aspetti dei nostri stakeholder, della nostra attività interni ed esterni; con rinnovata tensione farsi carico degli effetti sulla società; promuovere, etica; avere consapevolezz che le nostre scelte, all’interno, come all’esterno i nostri comportament a delle aspettative responsabilità sociale della nostra realtà, i e le nostre azioni d’impresa un nostro la diffusione di una producono sull’ambiente patrimonio condiviso, matura cultura della adottati, dalla strategia. e vissuto a tutti i livelli, sostenibilità. Ciò vuol Una scelta compiuta a partire da quelli dire fare della nella convinzione che ci permetta di innalzare dirigenziali più alti, assumere la responsabilità nel medio-lungo periodo dai sistemi organizzativi sociale e la sostenibilità miglioramento della la competitività del come orientamento qualità di vita di tutti nostro Gruppo – ovvero strategico di fondo, i nostri interlocutori di generare crescita e delle comunità in economica durevole cui operiamo. – e di contribuire al I NOSTRI PRINCIPALI
In coerenza con i valori di sostenibilità, di responsabilità, sociale di impresa onestà, trasparenza, è una dimensione strutturale integrità morale e affidabilità del contributo offerto dai contenuti nel nostro nostri principali stakeholder: nostro essere e del nostro agire che ci Codice Etico, la responsabilità aiuta a rispettare e l’ambiente, che ci fornisce i consumatori, che valorizzare, in un dialogo ogni giorno scelgono risorse essenziali; le continuo, il prezioso e apprezzano i nostri nostre persone, che loro apporti ad alto prodotti; i clienti, che con la loro professionalità tasso di qualità e di ci offrono la loro fiducia; innovazione; le comunità, e la loro dedizione investono nell’impresa; sono il motore dell’azienda; con la loro ricchezza le istituzioni pubbliche, culturale, sociale ed i fornitori, con i partner essenziali per unitamente ai rappresentanti economica; gli azionisti la regolazione e lo sviluppo aziendali, nel rispetto e i partner finanziari, della società e alimentano un efficace della reciproca autonomia che dialogo sociale e relazioni ed in spirito di collaborazione e del mercato; le rappresentanze dei lavoratori, dell’informazione, nella di fiducia nell’ambito che , promuovono il proficuo diffusione delle notizie dell’impresa; i media, coinvolgimento dei e nel delicato processo che svolgono una funzione lavoratori luoghi privilegiati di di costruzione dell’opinione crescita e diffusione fondamentale nella della scienza e della trasmissione pubblica; i centri di del no profit ricco di cultura, sono potenziali ricerca e le università fermenti e di stimoli acceleratori di trasformazione che, oltre a costituire valoriali; i concorrenti, la complessa rete di che sono un costante del business; il mondo relazioni che a loro stimolo delle associazioni e ci lega costituiscono per la nostra crescita. siamo e vogliamo essere. un valore aggiunto: Tutti i nostri stakeholder, un sistema integrato attuali e futuri, e e trasversale in grado di favorire la realizzazione di ciò che GLI IMPEGNI FONDAMEN
Assumere responsabilità sociale e sostenibilità come orientamento orientamento e, in strategico di fondo particolare: significa GOVERNO D’IMPRESA
integrare la Sostenibilità nella strategia e nei piani di sviluppo comparto
perseguire gli obiettivi
di mercato in modo
coerente con questo
aziendali avendo riguardo dei migliori standard perseguire la riduzione internazionali di degli impatti ambientali diretti e indiretti impegnandoci e delle foreste in modo distintivo favorire la cultura della nella tutela del clima, responsabilità, il gioco dell’acqua di squadra, la trasparenza valorizzare l’intelligenza, e il merito la creatività, l’iniziativa RISORSE UMANE includere nella valutazione personale e favorire lo sviluppo di competenze PRODUzIONE e nella valorizzazione specialistiche guidare lo sviluppo del personale gli aspetti della produzione affinché della sostenibilità PARTNER (economici, sociali processi tecnologici, promuovere e sviluppare e ambientali) qualità e sicurezza collaborazioni trasparenti FORNITORI siano permeati dai contribuire ad una e credibili principi della sostenibilità per iniziative di sviluppo gestione sempre più sostenibile responsabile della a valle, verso i clienti catena del valore: sia FIDUCIA NELLA MARCA a monte della catena creare un nostro distintivo del valore, verso i fornitori, punto di vista sulla che sostenibilità che sia fidelizzazione di tutti rilevante per la marca i nostri clienti e consumatori. e i nostri interlocutori e per rafforzare la AMBIENTE
L’Amministratore Delegato Luigi Lazzareschi
SOFIDEL SIGNS UP UN GLOBAL COMPACTO T pag. 3
Sofidel has signed up to the UN’s Global initiative, one of Compact the most important programmes in the world focusing on sustainability…
ECONOMIC DIMENSION OF SUSTAINABILITY
1 ECONOMIC SUSTAINABILITY POLICY The economic sustainability policy in the Sofidel Group is founded on continuous innovation through constant productive investment which allows us to exploit economies of scale, diminish the cost of transport and distribute our products in a more capillary manner. In confirmation of which, the Sofidel Group in 2010, within the framework of a precise strategy of reinforcement and internationalization, acquired total control of the LPC group which owns various production plants complete with paper mills and converting plants in the UK, Sweden, Belgium and France. This choice represents an industrial investment which is consistent with the development and growth path followed for more than a decade. During 2010 control was also acquired of the Romanian company Comceh, located in the South of Romania, with a view to reinforcing and developing our presence in the Balkans, a strategically important area for the overall development of the business. These acquisitions have allowed the Group to become the 2nd biggest European tissue producer. In 2010 the Sofidel Group has continued with its business strategy of strengthening its market position and sales margins although in the context of a significant increase in the price of the main raw material, cellulose pulp, which reached prices 60% above the annual average for 2009. The results for the financial year were very good for a period in which margins were generally squeezed, thanks to the selection of customers and products. We also maintained our policy of investing in our own brands (Regina and Softis in particular) through advertising campaigns and point of sale promotions. The Group has also, for some time, chosen to position itself in the upper segment of the market, putting itself forward for the production of private labels in the â€œPremiumâ€? segment of the large scale retail distribution market. In 2010, finally, Sofidel continued its implementation of the new organizational structure approved in 2009, the main objective of which is to better identify the roles and responsibilities of each member of staff. Every year targets are set for each area and progress is checked in a precise and continuous manner.
2 SIGNIFICANT OPERATIONAL DATA The last three financial years show the following summary picture:
CONSOLIDATED PROFIT AND LOSS ACCOUNT (thousands of Euro)
Value of production Costs of production Difference Financial income and charges Extraordinary income and charges Result before taxation Income taxes
1.080.013 (993.939) 86.074 (37.515) 259 48.818 (18.629)
1.031.832 (882.099) 149.733 (20.041) 1.455 131.147 (40.612)
1.483.254 (1.365.885) 117.369 (17.414) (28) 99.927 (32.790)
Total profit (loss) for the year
At the overall level the following variations were recorded compared to the previous year:
Brand Products Sofidel Group
+15,7% +3,4% +10,6%
The increased values for 2010 are due to the fact that the acquisitions made during 2010 had an effect from 1.01.2010 resulting in increased absolute values from the start of the 2010 financial year. TREND IN ECONOMIC-FINANCIAL INDICES EBIT EBITDA ROE ROS EBITDA/Sales Debt/Net Equity Debt/EBITDA
86.074 157.087 12.87% 8,21% 15,00% 2,73 4,03
149.733 225.467 27.62% 14,67% 22,10% 1,71 2,48
117.369 212.273 16,95% 8,08% 14,61% 1,94 3,63
The ROE was calculated from the ratio between the profit for the year (of the Group and third parties1) and the net assets (of the Group and of third parties) while the ROS was calculated from the ratio between EBIT and sales proceeds. The EBITDA was calculated by adding to EBIT provisions and depreciation/ amortization. 1
This relates to minority shares in the Companies in the Werra group which belong to the same shareholders as Sofidel S.p.A.
2.1 Investments TREND IN INVESTIMENT (thousands of Euro) Plant and expansion Costs of research and development and advertising Industrial patent rights and use of intellectual property Concessions, licenses and trademarks and similar rights Fixed assets in progress and payments on account Other intangible assets Land and buildings Plant and machinery Industrial and commercial equipment Other assets Fixed assets in progress and payments on account Total
70 7 14 832 2.109 61 7.214 30.396 479 6.997 28.441
589 0 0 3.558 757 534 56.329 38.308 621 5.896 22.638
The totals for 2010 take into account the investments made during 2010 by all the companies in the Sofidel Group in the new post acquisitions consolidation area. Obviously they do not include the starting values from 1 January 2010 of the companies acquired during the course of the year.
3 PRODUCTION AND DISTRIBUTION OF VALUE ADDED Value added measures the wealth produced by the company in the financial year, with reference to the stakeholders who participate in its distribution. The production and distribution of value added represents the principal through the relationship with the financial accounts. The calculation shows the Groupâ€™s ability to generate wealth for the various stakeholders, in accordance with the principles of good economic management and stakeholder expectations. CALCULATION OF VALUE ADDED (Thousands of Euro) Production revenues Intermediate costs of production Gross characteristic value added Balance from accessory management Balance of extraordinary components Global gross value added Distributed to Human Resources Distributed to the Company Distributed to Loan Capital Distributed to the Government Distributed to the Industrial/Service Sector
2008 1.074.714 781.471 293.243 6.705 259 300.207 137.064 99.336 44.220 19.391 196
2009 1.026.586 658.608 367.978 3.226 1.455 372.659 144.876 163.622 23.267 40.645 249
2010 1.478.071 1.059.005 419.066 4.195 (28) 423.233 205.444 159.787 21.609 36.114 279
The characteristic revenues have increased due to the growth in the number of companies belonging to the Group by 2009 and also due to the arrival of revenues from the new companies acquired in the course of the financial year. The distribution of value added has been directed increasingly to human resources rather than the Company due to the fact that net margins have diminished as a result of the increase in raw material costs. This factor has eroded the share borne by the Company while that of human resources has not been touched. 50
129.230 INVESTMENTS (Thousands of Euro)
ENVIRONMENTAL DIMENSION OF SUSTAINABILITY
1 STRATEGY AND ORGANIZATION FOR ENVIRONMENTAL SUSTAINABILITY In a year of exceptional expansion, which has seen the addition of seven production plants and more than 1300 employees, Sofidel has focused its attention, in addition to the consolidated sustainability targets, on the new acquisitions with the aim of standardizing environmental practices, spreading its culture of sustainability and evaluating the impact of the environmental performance of the plants acquired on the overall performance of the Group. This last aspect must be evaluated carefully in order to define the new environmental challenges and operating priorities. The environmental sustainability policies continue to give priority to global aspects such as the battle against climate change and the commitment to safeguarding forestry assets.
The environmental sustainability targets, at a corporate level, are: 2.
1. 1. Battle
against the greenhouse effect: Sofidel has confirmed its commitment to a reduction in carbon dioxide emissions following its entrance into the worldwide WWF Climate Savers programme. Analysis of climate altering emissions will include all the activities of Sofidel within its supply chain, from raw material to the delivery of finished product, with the aim of reducing the total in the future.
2. Integrating the environmental performance of the new plants with respect to Sofidel standards, with particular reference to water and energy consumption.
3. 3. Extension of the certified environmental management system for the ISO 14001 standard or EMAS at production sites because Sofidel considers that this activity, evaluated by independent third parties, is a guarantee of good management and continuous improvement.
2 SUSTAINABLE USE OF RESOURCES 2.1 Responsible purchasing of fibrous raw material The role of the Sofidel Group within the array of tissue paper producers in Europe has become one of key importance and with this comes responsibility for managing the more sensitive themes affecting the paper industry, such as environmental sustainability. The overwhelming use of raw materials from forestry sources (cellulose pulp) by Sofidel for its products makes forest management one of the most important environmental aspects for the Group. The evaluation and selection of pulp suppliers, which the Sofidel Group implemented some time ago in order to reduce the risk of making purchases from illegal or controversial sources, has proved to be a useful and effective tool in terms of encouraging pulp producers to adopt sustainable management measures for their forestry resources. In October 2010 the European Community adopted a regulation which establishes the method for evaluating the legality of the timber and derived products imported by countries within the EC. Sofidel, as an importer of cellulose pulp, comes under the scope of this regulation and is therefore evaluating the obligations involved, which appear however already to have been met in large part following the voluntary activities of adhesion to forestry certification schemes and supplier evaluation. 54
Virgin fibre raw material (tons)
Recycled fibrous raw material (tons)
Division of virgin raw material acquired by the Sofidel Group by producer (%) 10,4 25,5
FSC certified producers PEFC certified producers Controlled and assessed producers (FSC-CW standard) Other forestry certification schemes
PEFC: (Programme for the Endorsement of Forest Certification) is an international organization which aims to promote Sustainable Forest Management through independent third party certification FSC: (Forest Stewardship Council A.C.) is an organization which aims to promote appropriate and socially and economically sustainable management of forests via independent third party certification FSC Controlled Wood (FSC-CW): is a standard which aims to help companies to implement a responsible purchasing policy, avoiding trade in illegally felled timber and timber felled in violation of traditional and civil rights, in forests of high conservation value, forests converted into plantations or for non forestry use and OGM forests. 55
As evidence of its commitment to forest sustainability, Sofidel has implemented a programme for certification of the chain of forest custody for its many plants, with the aim of meeting market demand and demonstrating its commitment in this area. Sofidel (ITA) Delicarta (ITA) Soffass (ITA) Cartiera di Monfalcone (ITA) Delipapier (FRA) Delipapier (GER) Intertissue (UK) THP (GER) Omega (GER) Certification PEFC Certification FSC
In this way, about 82% of the production capacity of the paper mills is in plants equipped with the PEFC or FSC chain of custody certification. 2011 was proclaimed the International Year of the Forest by the United Nations. This event is aimed at sensitizing public opinion and increasing awareness of sustainable management and development of forests and their conservation. There are areas of the world where primeval forests are endangered by deforestation driven by the desire to develop intensive agriculture. One of the areas causing most concern is the Indonesian forest. According to the World Resource Institute, the forested areas of Indonesia and Sumatra have suffered a reduction of 40% in cover over the last 50 years, with a percentage of illegal felling as high as 70%. For this reason the Sofidel Group does not use raw materials derived from Asian timber.
Geographical distribution by source of timber used to produce pulp purchased by the Sofidel Group (%)
Europe North America South America Other 0,1
In addition to checking on respect for the principles of good forestry management and in compliance with its Purchasing Policy for fibrous raw material, the Sofidel Group checks that in the areas from which the timber used for pulp production comes there are no social conflicts or violations of civil rights, with particular reference to child labour. This is covered in a complex questionnaire on social aspects.
Its predominant use of raw material composed of virgin wood fibre and knowledge of the role that the forests play in the protection of the global environment and in enriching biodiversity have encouraged the Sofidel Group to adopt a precise policy for purchasing of fibrous raw materials, which is set out as follows: The Sofidel Group condemns the practice of illegal felling, the conversion of natural forests into plantations and takes measures to ensure that its suppliers can prove the source of the timber used to produce pulp.
The Sofidel Group’s purchasing policy 1. 2.
Sofidel is committed to checking, as far as possible, for the existence of social conflicts in the locations from which the wood originates, avoiding purchases from areas subject to conflict, from protected zones or from genetically modified organisms.
3. Sofidel believes in the use of sustainable forest management systems, certified in accordance with recognized, credible schemes and based on verification by independent third parties.
4. Sofidel encourages its suppliers to certify the source of their forestry resources and gives precedence
to suppliers who can produce certificates of good forestry management.
Sofidel Group plants are mainly situated in industrial areas, not characterized by a wealth of animal or vegetable species; nevertheless Sofidel contributes to the maintenance of biodiversity in the forested areas of the world through its own practices of sustainable purchasing of raw materials. The use of wood fibre with certification of its forestry origin is in fact a valid support for biodiversity in sensitive areas.
2.2 The rational use of energy resources The safety and sustainability of the world energy system represents one of the main challenges for those who must determine the rules for future development. On the one side the next few years are expected to see a dramatic increase in energy consumption, while on the other the issue of climate change imposes solutions involving low carbon emissions. From this point of view energy saving and increased efficiency appear increasingly necessary as solutions for organizations like Sofidel which have to manage “energy intensive” processes. It is right, therefore, to focus on alternative and renewable energy but, nevertheless, the opportunities for optimization of energy consumption appear ever more important and the prospects for improvement are attracting ever greater interest. The European Community has accordingly identified increased efficiency as the number one priority for its 2020 energy strategy, as communicated in the document: “Energy 2020, a strategy for competitive, sustainable and secure energy”. Sofidel continues to invest in research for solutions to increase its level of energy efficiency. An example of the numerous optimization activities which take place inside production plants is provided by the partnership with Ruud Lightening Europe for the installation of LED lighting systems. 57
LED LAMPS TO REPLACE OLD NEON OR OTHER TYPES OF LIGHTING
A YEAR ENERGY SAVING
During 2010 Sofidel installed more than 350 LED lamps to replace old neon or other types of lighting, enabling an energy saving of 250 MWh per annum. Other energy saving initiatives have been implemented in the various plants, both in relation to a reduction in consumption of thermal energy (for example insulation of the steam and condensation piping, boiler efficiency, insulation of the dry part of the paper machine) and in relation to a reduction in electricity consumption (see the replacement of old motors with new high efficiency ones and installation of inverters where possible). The specific results obtained in terms of a reduction in electricity and heat consumption are shown in: The main sources of energy consumption in the Group are: • natural gas, used in the production process and for the production of electricity and steam • electricity, for the various industrial facilities and offices • other fuels such as diesel or LPG to feed the equipment used internally to move the goods. This is a minor source compared to the two above
Division of energy resources consumed by the Sofidel Group (%) 0,5
Total (TJ): 7.328
Total (TJ): 7.640
Natural gas Electricity Other fossil fuels
Total (TJ): 7.530
The high incidence of natural gas is due to the fact that this, in addition to being used as the sole fuel in paper production machines, is also used to fuel modern cogeneration plants; this involves a consumption of 14% more than the standard profile. The reduction in use of natural gas and the consequent increase in consumption of electricity for the combined production of heat and power is due to the reduced hours of operation of the Imbalpaper cogeneration plant during 2010. Electricity is essentially purchased on the free market: Sofidel, like other firms in the industry, uses traders who buy energy shares with variable composition over time so that it is not possible to give an account of primary energy use. As regards self produced energy, Sofidel uses photovoltaic, hydroelectric and mainly cogeneration plants. methods of self production of electricity in the sofidel group electricity by source (GJ) - % of total electricity consumed From photovoltaic plant
2242 - 0,1%
From hydroelectric plant
8052 - 0,3% 361652 - 13,7%
Division of use of natural gas in the Sofidel Group plants (%) 13,7
Combined generation of electricity and heat Production processes and central heating
In terms of energy efficiency the solutions adopted to date have enabled a reduction in total consumption of fuel and electricity of about 7% in only three years. This unexpected and prestigious result bears witness to the effectiveness of a systematic approach to the optimization of industrial plant and shows the potential for further improvements especially in the plants recently acquired by Sofidel. The results achieved are in line with the targets that Sofidel has set itself since 2008.
Average detailed energy consumption of Sofidel Group plants
Natural Gas (mj/tonne of paper)
Electricity (mj/tonne of paper)
LITRES OF WATER USED ON AVERAGE PER KG OF PAPER PRODUCED
2.3 water saving and conservation Water is an irreplaceable component for paper production: it is used for various applications in the production process and in particular represents the fluid through which the fibres are moved. Unfortunately, one of the results of climate change is the occurrence of increasingly frequent and long lasting episodes of draught in a growing number of European localities. Research by the European Community shows that in a 30 year period (1976-2006) the number of places and populations hit by a shortage of water in Europe has increased by 20%. The Sofidel Group has always invested in technology and management methodologies to reduce water consumption, exporting throughout Europe its culture of water saving born in the plains of Lucca
The specific average consumption of Sofidel activities is less than 8 litres of water per kg of paper produced (l/kg), but on some production sites performance with water consumption of below 6 litres/kg of paper produced is achieved. To date the best technologies applicable in the paper sector and described in the BREF* provide for consumption of between 10 and 25 l/kg for the tissue paper sector, 3 times more than the Sofidel average. A notable achievement during 2010 is the improvement in the Monfalcone (ITA) paper mill plant, which by making changes to the intake water pumping and storage system has succeeded in reducing its consumption by 41% in a year. In the same way the THP (GER) paper mill has passed from specific water consumption of 11 l/kg in 2008 to 8 l/kg in 2010. The new production activities acquired in the course of 2010 must be carefully analysed to understand the level of water consumption which they feature. The aim will be to bring performance of these paper mills up to the level of the average currently achieved in the Sofidel Group, within a time period long enough to allow for possibly radical intervention.
average specific water use in sofidel group plants 8,06 7,43
mc/ton of paper
*Reference Document on BAT for pulp and paper industry
Water Supply Sources (%)
68,6 Water bearing stratum Surface water Waterworks (mains water)
29,2 29,9 42,0
Another effort being made is to protect the most precious water resource, that from underground sources, encouraging use, where possible, of water from surface sources such as rivers. In 2010 no significant progress was made to a breakdown in the system for supplying surface water, in particular in the plains around Lucca. The slight increase in consumption of water from the water bearing stratum in 2010 was mainly caused by the acquisition of the Greek company Papyros, which uses this resource for its production cycles.
Recycling of water in production plants
In the paper industry there are numerous systems for clearing process water (removing fibre) to enable reuse: these generally involve filter systems of various degrees of complexity, or chemical-physical cleaning systems (decanters, floaters and liquefied air) and in general the quantity of water reused is enormous. In addition, where possible, we try to reuse process water as it is, avoiding cleaning stages which may reduce the capacity for water recycling. Water is used in paper mills mainly as a vector fluid for the fibre, allowing it to be transported from the paste preparation section to the continuous paper machine where the fibre arrives diluted to a percentage of approx.0.3%. This means that a paper mill production plant needs more than 330 cubed metres of water per tonne of paper produced. A Sofidel plant instead uses on average 7 cubed metres/ tonne of paper. Part of the water consumed cannot however be reused because it is dispersed into the atmosphere by the paper drying plants: this involves an average quantity of about 2.5 mc/tonne of paper. In general, the data on water treated by the cleaning plants located downstream of some production plants by itself shows that the percentage of water recycled is above 80%. Another example of the virtuous cycle of water recycling is the Werra (GER) paper mill, which uses as an input the waste water from the nearby THP (GER).
Carbon Intensity (kg CO2/ton)
3 THE QUALITY OF THE ENVIRONMENT 3.1 Struggle against the greenhouse effect Following the Party Conference held in Copenhagen in December 2009, the amount of attention paid to climate change seemed to drop suddenly, with only minor commitments by governments and economic operators to pursuing the objective of reducing emissions. In reality, by the Spring of 2010, the European Climate Commissioner, Connie Hedegaard, had called together some of the leading companies in Europe in the struggle against climate change, including the CEO of Sofidel, Luigi Lazzareschi, to sample European industrial opinion. Following this call, the General Climate Management Body communicated its intention to raise the target for carbon dioxide reduction in the European Community to 30%, having estimated the consequences in terms of costs and confirmed industry’s willingness to make Europe the lead continent in the struggle against global warming. The Party Conference of Cancun (Mexico) in December 2010 has subsequently confirmed the urgency of measures to reduce emissions and contain the consequences of climate change, strengthening the climate of trust in relation to international agreements. The approach of the end of the second allocation period for the Emission Trading mechanism implies a need for operators in the sectors involved in this mechanism to draw up strategies to reduce the financial risk connected to future allocations. Against this background the choice made by Sofidel to join the international Climate Savers programme has been shown to be consistent and far-sighted. The initiatives taken to achieve the agreements undersigned fit perfectly within the broader corporate strategy of environmental and financial sustainability, reinforcing Sofidel’s leadership within its own sector.
Reduction in emissions of CO2 and Climate Savers In December 2008 Sofidel joined the WWF international project known as Climate Savers, which brings together big companies which are leaders in their sectors to implement ambitious programmes to reduce carbon dioxide emissions. Sofidel’s target is to reduce its direct emissions of carbon dioxide by 11% by 2012 and by 26% by 2020 compared to levels in 2007. These targets will be revised based on a careful analysis which Sofidel will carry out with the WWF of the new activities acquired by the Group in the course of 2010.
26% CO2 emissions reduction target by 2020
* Excludes the Papyros (GRE) plant in 2007, 2008 and 2009. The emission coefficients used are given in the Glossary.
While in 2009 activities focused mainly on containing consumption of electricity and heat, in 2010 Sofidel invested considerable amounts both in solar plant and cogeneration (combined heat and power) plants. In fact, during 2010, two important photovoltaic installations were brought on line in the Soffass and Delicarta converting plants, with a total installed peak capacity of 1300 kW for a total investment of around 4.6 million Euro. These plants, covering a total surface area of about 13,000 m2, will be able to produce 1500 MW h of electricity per year, avoiding more than 670 tonnes of CO2 emissions. With this work the total electrical power installed using photovoltaic technology at Sofidel plants now totals 1800 KW, which also includes the Delicarta paper plant, in operation since 2008. Finally the start up of the hydroelectric plant at the Fibrocellulosa plant will allow around 800 MW h of energy to be produced, equivalent to over 350 tonnes of CO2 avoided in 2011. Investment since 2009 totals 1.5 million Euro. Another field of activity in which Sofidel has invested a great deal in the past is cogeneration of electricity and power at its production plants. At the end of December 2010 a further cogeneration plant was added to the existing plants, at the Polish Delitissue plant. The plant consists of a new generation gas turbine (producer Solar Turbines, model Mercury 50, electrical power 4.5 MW) which can cover the entire electricity and steam requirement of the plant, with the possibility of contributing during winter months to the supply of hot water to the heating system of the town of Ciechanow. In total this investment amounts to about 7 million Euro. The plant allows for recovery of the heat discharged from the combustion fumes of the turbine, allowing total system efficiency of above 80% and a substantial reduction in pollutants (NOx, CO). With regard to emissions of CO2 a reduction of 15900 tonnes per year has been obtained.
7,0 =15.900 Million Euro invested in cogeneration plants in Poland
of CO2 avoided
Electric energy cons. 4 GWh/y
Natural gas cons. 128 GWh/y
before 2011 AFTER 2011
Electric energy cons. 41 GWh/y Natural gas cons. 62 GWh/y
Paper, 30.000 t/year Paper, 30.000 t/year
Hot Water 12 GWh/y
After two years of intense activity on optimization and investment in reducing emissions of carbon dioxide (the so-called Purpose 1 and Purpose 2), Sofidel has started reporting indirect emissions, that is, those coming from processes which are not directly under the control of the organization itself (Purpose 3). This involves an overall task for which the rules are continuously evolving and where there are few examples available. In spite of this the quantification of emissions from activities linked to production of raw materials, transport or other services will allow us to identify the overall impact of our activities and involve all the players in the supply and distribution chain in reduction projects. The Emission Trading mechanism 2012 saw the completion in Europe of the second phase of application of the Emission Trading regulations, aimed at enabling a reduction in carbon dioxide emissions, in accordance with the 1997 Kyoto protocol. The aim of this legislation is to give an economic value to carbon dioxide emissions, transforming them into a corporate asset so that reduction of emissions is linked not only to environmental improvement, but also to financial motivations. The Sofidel Group has managed the quotas assigned to its plants without undertaking speculative activity, but aiming to reach self sufficiency at a Group level. From 2012 the allocation mechanism will change radically and the quotas, until now allocated free of charge, will no longer be so for the most part. The paper sector in any case, being heavily exposed to the risk of delocalization due to the costs associated with CO2 emissions (so-called carbon leakage), will benefit from a free quota share of its own total emissions.
3.2 Other impacts Emissions into water The Sofidel Group has always invested in the optimization of treatment plants for waste water, to such an extent that today, 98% of the production capacity of the Groupâ€™s paper mills uses directly or indirectly biological aerobic purification to treat its waste water. This has been achieved against a background of overwhelming use of virgin fibre as a raw material, which guarantees a higher quality of waste water.
Average specific emissions in water of the Sofidel Group (Kg/tonne of paper)
COD BOD5 Suspended solids 0,89
Total quantity and destination of waste water (%) 7,3
Total (mc): Sea (biologically purified) River (biologically purified) River (chemical-physical purification) Public sewers
The quality of waste water, in addition to complying with the limits imposed under the regulations, is such that it does not undermine the chemical and biological quality of the water courses into which it is released. This has been demonstrated for example by the regular biological monitoring now carried out for some years on the river which receives the waste water from the Imbalpaper (ITA) plant. These investigations in fact show that the quality of river micro fauna has not suffered any appreciable alteration downstream of the discharge pipe, maintaining the same class as those upstream of it. In any case there is no shortage of improvement actions linked to waste water treatment processes. At the Soffass paper mill (ITA) a project is underway to rationalize the entire cleaning plant and to change the system for collection and treating the sludge, which will lead to a substantial improvement in the quality of discharges. The total investment approved amounts to about 400.000 Euro.
Waste management European waste management policy gives priority to the reduction, reuse and recycling of waste. Sofidel, by producing paper mainly from virgin cellulose, produces a limited quantity of waste, much of which is recycled. Moreover pulp based manufacturing off cuts are reused directly within the production plants, contributing to a reduction in waste produced (31765 tonnes in 2010). The main residue produced by the plants is sludge from the treatment of recycled fibre and from the cleaning plants located downstream of the production plants; this waste is recovered mainly in the production of articles for the building industry, for agriculture or treated in heat using energy production plants, while a small part is sent to landfill. Another part of the waste is composed of materials which are reused in other production cycles such as paper, wood, metals and polythene. The paper making process involves only a negligible production of hazardous waste, which in any case is not a feature of paper making, but associated with the use of industrial equipment such as, for example, waste oils, neon and lead batteries. The Sofidel Group does not ship waste to countries where disposal methods are not so safe or rigorous; each plant in fact arranges the disposal of its waste in local structures in the immediate vicinity of the plants.
Average specific production of waste (kg/ton of paper) of plants in the Sofidel Group
kg waste/tonnes of paper produced
of which non hazardous of which hazardous
kg waste/tonnes of paper produced
kg waste/tonnes of paper produced
Percentage distribution of non hazardous waste produced by the Sofidel Group by type (%)
*4.1% of which contains ink 68
Sludge (used for production of building materials, compost, agricultural use, waste) Pulp waste (used for heat production of energy) Directly recoverable materials (metal, plastic, wood, paper) Other waste (various uses)
Average specific emissions of nitrogen oxides (nox) from Sofidel Group plants (mg/mj)
NOx 68,2 60,7 57,6
Other emissions into the atmosphere The emission of nitrogen oxides (NOx) is the main indicator of quality of emissions into the atmosphere by fuel burning plants in Sofidel, given that the only fuel used by the paper process is natural gas. This indicator therefore depends on the quality of fuel used, and is therefore expressed per unit of energy deriving from the use of the fuel (mg/MJ). From an environmental point of view, the emission into the atmosphere of nitrogen oxides are responsible for so-called photo smog: these substances in fact, once linked to non combustible hydrocarbons, deriving for example from the use of combustible fuels for means of transport, can generate ozone, a gas which is irritating for the respiratory airways; the use of natural gas in Sofidel plants however ensures a reduced level of emissions. Other gases which are potentially harmful to the environment, such as CFC (chlorofluorocarbon) which is partly responsible for the reduction in the stratospheric ozone layer, or other greenhouse gases, are emitted in very low quantities as they are not produced as a result of the typical activities of the Group. Sulphur emissions are not considered for the same reason (Sofidel only uses natural gas to fuel its plants). Transport The European transport sector is responsible for about 20% of total emissions of carbon dioxide, and therefore holds second place among the sectors with a higher intensity of emissions. On the contrary however to what has happened in the energy and industrial sector, transport has seen an increase in emissions of about 24% in the last 15 years, evidence of its critical importance. The Sofidel Group pursues its own initiatives aimed at reducing emissions of carbon dioxide in the logistics sector. With the rationalization of transport Sofidel promotes, in fact, a reduction in the environmental impact resulting from the distribution of its products by giving incentives for the use of less polluting vehicles and systems, in particular rail transport and inter-modal transport (road + rail). Up till now Sofidel has set itself an annual target for the volume of goods transported on less polluting vehicles compared to the total. In 2010 the target of 3.06 % was achieved with a result of 3.19%. In addition, also with a view to reducing emissions of CO2, the German company THP replaced 10 lorries with the same number of more modern vehicles, thus bringing its company fleet to 50 vehicles, all registered EURO 5.
Environmental Emergencies Environmental emergencies are dealt with by applying good environmental management systems which involve: â€˘ analysis of all the potential risks associated with the activities and the products; â€˘ theoretical and practical exercises for personnel involved in production activities; â€˘ training and updates for the sector managers and production personnel (827 hours in 2010 devoted to environmental training including emergencies). Thanks to the adoption of such policies there have been no environmental emergencies in 2010. In the course of the year no significant administrative sanctions have been applied by the authorities in charge of environmental inspections. It should be noted however that, following an inspection for the purposes of the IPPC regulations at the Delicarta paper mill plant, some irregularities in the management of waste by ARPAT were raised. The Company is checking the consistency of these findings. In 2009, at the Fibrocellulosa paper mill, failure to comply with a countryside restriction was confirmed and led to the sequestration of a building site. The site has now been almost completely released from sequestration.
4 ECOLOGY IN GROUP PRODUCTS The European Community is broadly committed to seeing that the environmental sustainability policies put in place are practically implemented in the consumer market. In this sense the Eco-design directive, which applies to products which consume energy during their operation, is changing the framework for the design and production of numerous articles. In the tissue arena, in 2009 the European Commission published the new criteria for obtaining the European ecological quality mark (Ecolabel); following which Delipapier (FRA) obtained the Ecolabel ecological quality mark for some articles and similarly Delicarta (ITA) renewed its range of items in accordance with the new criteria. In 2011 the Delipapier Buxeuil production site will also obtain the Ecolabel quality mark. It is precisely these ecological quality marks which are of interest to those working in the so-called Away from Home (AFH) sector, the sector which covers paper for the industrial/service sector, public places and professional use. In fact public procurement policies in many European states give preference to purchases of more sustainable items: this translates in the paper sector into preferring, for example, products with the Ecolabel mark. In 2010 Sofidel significantly widened its own range of articles (over 70 just in the Delicarta and Delipapier sites) with the Ecolabel mark and has extended the number of sites capable of producing this type of paper. In the Private Label sector, the market in 2010 was characterized by the requirement of some important distributors for ever increasing quantities of paper from guaranteed forestry sources. Sofidel has been able to meet this demand thanks to its purchasing policy, which has allowed it to have the quantities of certified raw materials required, and thanks to the capillary spread of chain of custody certification in the various plants.
In the brand sector, Regina, in agreement with the WWF, has launched two campaigns to raise awareness in Italy. The first, launched at the end of 2009, aimed to launch, in partnership with the WWF, the year of biodiversity (2010) using various gadgets. The second campaign, launched in mid 2010, again in collaboration with the WWF, aimed once more to raise awareness of climate change issues, promoting the â€œClimate Generationâ€?, a WWF Italia initiative, with a series of useful information on the daily actions which may be taken to reduce individual CO2 emissions
http://generazioneclima.wwf.it With regard to initiatives to reduce packaging, a project has been started, in cooperation with certain suppliers, to reduce the quantity of polythene used for packaging; within a few years this work plan could lead to a substantial reduction in the quantity of packaging used.
Water consumption l/kg) TOTAL fossil fuels consumed (MJ/t) of which for cogeneration (MJ/t) Total electricity consumed (kwh/t) of which self produced for cogeneration (MJ/t) of which self produced from renewable sources (kwh/t) of which purchased from the national network (kwh/t) COD (kg/t)* BOD5 (kg/t)* MST (kg/t)* N (kg/t)* P (kg/t)* AOX (kg/t) NOx (kg/t) CO2 (kg/t) Total waste (kg/t) Non hazardous waste (kg/t) Hazardous waste (kg/t)
Car t ITAL iera di Y Mo nfa lcon e
Imb ITAL alpape Y r
Del ip FR apier
Sof f ITAL ass Tra Y sf.
Sof f ITAL ass Ca Y rt.
Del ic ITAL arta C Y onv .
Del ic ITAL arta C Y art.
5 THE FIGURES ON ENVIRONMENTAL PLANT MANAGEMENT
Del ip FR apier Bux eil Pap GR yros
Om e DE ga
We r DE ra
Pap ITAL ernet Y
Sofi TR del Ka git
Del ip DE apier
Inte r UK tissue
Ibe r E tissue
Fib ro ITAL cellul osa Y
Del it PL issue
(I) Integrated plant The data shown refer to the production: • of parent reels for the paper mills • of finished products for the converting plants • of parent reels for the integrated plants - parameter not applicable to the plant The three Werra, Omega and THP plants have a common water discharge *Values calculated from the results of internal analyses and analyses by qualified laboratories
SOCIAL DIMENSION OF SUSTAINABILITY
1 SOFIDEL AND HUMAN RESOURCES Sofidel personnel contribute significantly to the achievement of the objectives set for the Group. Taking note of the expectations and personal needs of employees, equal opportunities and equality at work, protection and safeguarding of health, commitment to professional development and recognition of results are the fundamental principles on which the Sofidel Group bases its relationship with those working for it.
1.1 Staffing make up As at 31.12.2010 the Sofidel Group is able to count on the professionalism of 4526 staff, 1390 units more than in 2009 (about 10% more net of acquisitions). These data also include the companies in the LPC group and the Romanian company Comceh; given that they were acquired during 2010, the reports which follow regarding Group personnel, unless specifically indicated, will not take these companies into account.
tot. 4.526 Subdivision of Sofidel personnel by category* tot. 3.136
tot. 3.115 2.220
Manager White collar Blue collar
721 301 220
More than 95% of employees are taken on with permanent contracts and nearly all personnel are taken on with full time contracts.
OF EMPLOYEES TAKEN ON WITH A FULLTIME CONTRACT
* In 2008 the white collar category included the upper management and middle management bands. Since 2009, in order to standardize the definition of manager at a corporate level, within Group companies employees with management functions as well as directors have been considered managers. The 2010 data also include the companies in the LPC group and the Romanian company Comceh. 76
Percentage division of the employees of companies in the Sofidel Group by geographical area (%)
ITALY 34,69% GERMANY 21,92% FRANCE 16,66% UK 8,82% POLAND 9,34% SPAIN 4,26% TURKEY 2,42%
Subdivision by percentage of personnel of the Sofidel Group by category and age band (%) 2008
GREECE 1,77% CROATIA 0,12%
Blue Collar 26,28
30 - 50
By geographical area Italian Companies Foreign Companies
Staff turnover in the Sofidel Group
By gender Men Women
By age band
<30 30-50 >50
The rate of turnover for the Group shows low values again for the 2010 year, consistent with the positive trend of the previous two years: an indicator of the Company’s ability to retain staff. In 2010, the rate of absenteeism in Group companies, that is, the ratio between days of absence from the work post and working days is as follows: sickness 3.77% and accidents 0.40% (this excludes Delisoft and Sofidel Papir).
1.2 Industrial relations Sofidel shares with the various trade union organizations a complex industrial relations system based on constant constructive debate and fully in line with the fundamental principles in the CCNL (National Collective Work Contracts) in operation. Constructive exchange of ideas and dialogue between the Parties represents an indispensable opportunity to ensure a systematic relationship with the trade unions, aimed at achieving positive solutions for the Company and for workers and preventing the emergence of individual and collective conflicts. It is worth noting that there is a very low level of internal conflict. Also in terms of work disputes no significant sanctions have been recorded. The most significant events during 2010:
• thanks to the agreement signed on the 4 June 2010 it has been agreed to extend, including to blue collar workers, from 2010 and up to the expected general review at the end of 2012 and in accordance with criteria and methods defined by the Company, a bonus linked to the trend in company economic-financial indicators • two meetings have been held with the trade unions to monitor progress in the technical-production and economic analysis aimed at verifying the possibility of carrying out, on the Valdottavo (Lucca) site, new production activities. • following the introduction of the so-called Psd E.U. Directive, a change in the monthly terms for salary payments has been agreed • various agreements have been signed for the installation of video surveillance systems in order to guarantee the safety of and protect company assets • there have been discussions on the method for applying the regulations on the subtraction and exemption from contributions of sums and allowances paid by the Company for the pursuit of productivity increases and improved organizational efficiency
• renewal of contract in relation to production bonuses and new agreement on annual increments
• renewal of the company agreement containing an improvement in both salary elements and norms relating to working conditions
• in Delipapier GmbH a new company agreement has been drawn up and agreed in relation to holiday planning • in Werra new company agreements have been concluded in relation to management of overtime and lunch breaks.
In the companies located in Italy all employees come under the relevant National Collective Work Contract. In Group companies abroad the work contracts for about 56% of employees are governed by national collective contracts, while the remainder are subject to individual and company collective contracts in accordance with the laws of each individual country. Communication of organizational changes takes place using corporate tools made available in accordance with the time limits and methods set by law and normal industrial relations practice. In Italy the relevant rules are set out and detailed in the relevant National Collective Work Contract. In the foreign companies, if there are operational changes, communication to the employees involved must take place beforehand in compliance with the times and methods set out in the applicable contracts, or, where these do not apply, sufficiently in advance of the implementation of these changes. In 2010 in France it proved necessary to temporarily relocate certain production workers to the Italian Papernet company to undergo a course of training; the French personnel were given reasonable notice of this three weeks beforehand.
1.3 Equal opportunities, diversity and non discrimination The Sofidel Group manages human resources at an international level with homogeneous instruments, but in compliance with different legislation and local cultures, giving encouragement to the cultural peculiarities, traditions and customs of the various countries. For Sofidel, diversity is a form of wealth to be cultivated and made the most of, making for a favourable comparison with best practice on innovation and development. Sofidel has also formalized these principles and values by signing the “Charter for Equal Opportunities and Treatment at the Workplace”. (FOTO DELLA CARTA) This is a voluntary statement of intent, signed by enterprises of all sizes, on the rolling out of an inclusive corporate culture and human resources policies which are free of discrimination and prejudice and reward and value talent in all its diverse forms. The Charter provides a framework of reference values, providing not detailed prescriptions but programmed commitments. As set out in the Ethical Code, in the Sofidel Group any form of discriminatory conduct based on race, sex or gender, religious or political opinion, state of health and, in general any intimate and personal characteristic of the individual is prohibited. In Italy, as in the UK, France, Turkey, Germany, Spain and Poland there are special reporting tools, or boxes distributed within firms, where employees may deposit anonymous reports of suspect episodes. In accordance with international conventions, the Universal Declaration of Human Rights, national employment regulations and the principles of Global Compact, the Sofidel Group rejects any form of under age labour, in particular child labour, and forced labour. Finally, in all the companies of the Group employees are free to exercise their rights to form and join trade unions or other organizations for collective bargaining or to form new ones, or to abstain from membership of such organizations. In Italian companies the examination and monitoring of all aspects are entrusted at a corporate level to the CSR Committee; in Europe special CSR Local Committees monitor to see that there are no breaches of the rules or discrimination. It is worth noting that in 2010 there were no reports of such problems. The above criteria are also applied at the supplier evaluation stage as described in the paragraph “Sofidel and its suppliers”. 79
As at 31 December 2010, 12.80% of the Groupâ€™s workforce was composed of women. In particular, the professional role in which women are most represented is white collar employees. The Group meets the obligations set out in regulations relating to the recruitment of staff belonging to protected categories in force in the countries in which it operates. In 2010 there were 81 staff belonging to these categories, 4 more than in 2009. Companies in the Sofidel Group adopt recruitment procedures which give preference to people from the local community in order to foster economic development and better meet the needs of the community in question. This also applies to managerial levels; in fact 95% of these belong to the local community, the remaining percentage refers to a restricted number of Italian managers on temporary secondment to foreign companies in the Group.
1.4 Systems of pay and incentives Sofidel, in line with its own principles, determines salaries in accordance with legal standards and ensures compliance with criteria of equity, transparency and equality in terms of category, male/female and conditions/requirements in general.
Percentage relationship between mensâ€™ and womensâ€™ salaries subdivided by category*
0,60 0,77 0,74
In line with what has been recorded in relation to the job market at an international level, the above data show that, although there are Group policies and pay policies based on equity and equality of treatment between men and women, women, in general, occupy posts of lesser responsibility. This is due, mainly, to the increased difficulty which women have in balancing family care with work demands (including demands on their time) linked to the taking on of increased responsibility. With a view to improving this situation, the Sofidel Group has equipped itself with rules containing flexible timetables for coming to and leaving work, adhered to the Charter for Equal Opportunities promoted by the Sodalitas Foundation and is active in projects aimed at improving work life balance (e.g. the nursery project in Italy). In recent years the percentage of women undertaking management roles (white collar supervisors, managers and directors) has increased, most recently with the recruitment of the corporate director of the legal organizational unit. Based on an analysis of the legal minimums, both in countries where national collective bargaining applies, and in countries where other forms of contracting exist, and comparison with the minimum salaries paid by the Group, it has emerged that Sofidel guarantees, as a minimum, payment of significantly higher basic salaries and often significantly higher starting salaries, as in the case of Spain and the UK. *Delisoft is excluded from the reporting 82
In order to make the most of and develop its human resources, some companies in the Group have implemented reward systems, naturally adapted to the culture, traditions and legislative framework of the various countries. This system is based on the definition of specific, measurable and achievable targets, shared in such a way that employees are able, by their conduct, to have an impact on these; with regard instead to monitoring of their achievement, responsibility is assigned to the managers of the various areas. Some of the targets relate to specific elements of performance on sustainability such as: reduction in CO2 emissions and containment of energy consumption. In all Group companies there are performance evaluation programmes for employees which form part of the reward system and consist of a feedback interview based on a questionnaire containing questions which take into consideration strategic aspects of performance. In 2010 more than 10% of employees of companies in the Group obtained financial bonuses, while more than 21% obtained pay increases. The benefits granted to employees are paid without any distinction between full-time and part-time employees.
• With the coming into force of the law reforming the complementary welfare system, each employee may voluntarily choose how to use his Severance Pay (TFR). For employees of Italian companies there is an option to pass on to the Complementary Pension Fund for the BYBLOS category both the TFR and a regular sum paid at their own expense of a minimum of 1% of annual salary, to which the company contributes, paying a further 1%
• There is a form of provision for managers in addition to the pension package paid by the organization and equal to 0.6%
• There is a fund called the “Company pension scheme” which offers employees the opportunity to pay in a share of up to 6% of annual salary; the company contributes a similar share to that paid in by the employee
• At the Delipapier GmbH plant, the company adds on 10% to the contribution that the employee decides to pay into the fund as its own contribution, while in the Werra Group the company contributes 20%.
1.5 Training and staff development Staff development is a key factor for the Sofidel Group, which bases its corporate strategy on intellectual capital, developing and implementing individual growth plans to keep track with technological innovation and the continual changes induced by changes in background conditions. Based on a staggered process for identifying training needs and evaluating individual professional competences, Personnel Management, in particular the organizational unit responsible for Group training, 83
has drawn up a wide ranging Training Plan, aimed both at the development of professional and technical skills and the development of managerial and operational skills which extends to all staff. In continuation of the project put together in 2009 together with SDA Bocconi, which benefited all those who took part in it, a more in-depth version of the “Leadership at a time of change” course has been produced. ìDevelopment of active listening, motivation and leadership skills has been rolled out across the various levels of the organization, for all those who have responsibility over other people. At the end of the course the managers who have so requested are offered the chance of a personal interview with the professional holding the course, to analyse the individual problems involved in managing their own staff. At the same time a project has been developed which has involved various company staff on management of work groups, the importance of team work and problem solving ability within teams. A new project dedicated to self improvement pathways has been rolled out in almost all the Italian companies of our Group: the “Notebooks for growth” series. These publications are the fruit of a series of meetings which have involved, in individual plants, managers at all levels (COM Italy, plant managers, production managers, production engineers, maintenance managers, heads of shift, heads of department, shop foremen etc.). Through meetings and interviews, reflection has taken place on the values and behaviour which characterize the Group and the individual company units, in order to understand and put in context the specific experience gained and to identify problem nodes and possible areas of improvement. Some specific themes have been focused on, for which development targets have been set and precise commitments and action plans for achieving them shared. In 2010 in the Sofidel Group 48,298 total hours of training were delivered. Including incentives and contributions, in 2010 investment in training, delivered by bodies outside Per capita training hours* the company organization, amounted to 402.409 Euro. 8,10 71 hours of training were devoted to legislative Manager updates on employee rights and duties. White collar In addition, the first meetings were organized at Blue collar a European level in the Marketing and Sales area with the intention of developing joint approaches and tools capable of characterizing the entire range 40,12 offered by Sofidel in a market situation in which 27,90 the relationship between customers and other stakeholders is increasingly important. As part of these events, which have included a series of meetings, debates and discussions organized to reflect on results and objectives, training days have been held on the subject of corporate social and environmental responsibility. In particular, 330 hours were devoted to the importance of the rules, principles and values set out in the Group’s Ethical Code.
*These data do not include the companies Papyros and Sofidel Papir 86
With regard to the creation of programmes for the management of competences and to promote the training and updating of Group employees, it is worth noting that in 2010 the first version of the organizational manual was completed and distributed (see paragraph on “Projects relating to management of the new organization” within the Group. Following a subsequent rationalization of the posts available throughout the Group, and following the publication of the new organizational structure, the first revision of the document has been compiled, which will be distributed in the course of 2011. The analysis of the organizational manual has made it possible to identify gaps in skills, thereby allowing the Company to intervene with ad hoc training courses. Since 2007 Sofidel has taken part in the “Stars at Work” campaign. Awarded by the President of the Republic based on proposals from the Ministry of Labour, this is one of the oldest decorations which can be obtained in the field (for 25 years of uninterrupted work) and is aimed at recognizing hard work and dedication to the job. The decoration entitles the holder to use the title “Master of Work”. In 2010 one of the Group’s employees was awarded the honour by the jury and 4 candidates have been put forward for 2011.
1.6 Workplace health and safety IThe Sofidel Group looks after the Health and Safety of its employees, contractors and visitors in order to reduce accidents and occupational sickness. The lead coordination and development of policies and targets relating to workplace Health and Safety is delegated to a corporate unit, formed of qualified personnel who also make use of primary consultancy studies. In compliance with the regulations, employee health is protected by constant monitoring of the work environment, implementing safety standards relating to plant and machinery, implementing training programmes and carrying out information activities. Moreover, following the risk assessment, regular health surveillance is carried out and specific health risk protocols developed. Careful attention is paid to the choice of personal protection equipment in order to constantly check its efficiency and continually improve its effectiveness to ensure ever better levels of protection and comfort. During the course of 2010, on the corporate structure side, intensified audit work was also carried out at foreign plants in order to spread the safety culture from a technical viewpoint and to roll out management systems. In all the Italian plants, Ibertissue (SPA), Intertissue (UK) and Delipapier GmbH (GER) a form of tender has been stipulated with the firms bidding for the contract which requests a series of information such as:
• technical-organizational requirements and degree of autonomy required to carry out the work • • • •
subject to tender; technical-professional and psycho-physical requirements for all personnel who may have access to the plant which has called for tenders; documentation confirming that the correct contributions, salary and insurance premiums are paid for all workers who may access the client company’s premises; specific risk assessment document for the contractor and any subcontractors, relating to their own work at the client company site; list of names of people who may have access to the areas where work is being carried out.
In addition the plants arrange to inform the tendering firms about the risks to which their personnel may be exposed and the rules of conduct to be followed in an emergency. In Delipapier (FRA) the sole document which is issued is the “prevention plan” as required by the French national regulations applying to tenders for work in excess of 400 hours/year. 87
Time line showing the spread over time of the OHSAS 18001 safety management system Fibrocellulosa (ITA) Papernet (ITA) Soffass converting (ITA) Intertissue (UK) Delipapier Frouard (FRA) Delicarta cartiera (ITA)
The Sofidel Group carries out monitoring of the trend in accidents and injuries in the various plants using a series of indices, the most significant of which are as follows: • frequency index • seriousness index In 2010 a new methodology was created for the collection of data to calculate accident indices. The new methodology, developed by the corporate Health and Safety division, was made official in all the plants of the Group during April 2010.
Sofidel Group accident indices* Frequency Index number of accidents / hours worked*1,000,000
Seriousness Index days of absence due to accidents / hours worked*1,000
34,07 29,08 23,85
Number of deaths: 0
*The value of the accident indices reported do not take account of accidents “en route” or of those causing less than 3 days of absence for the employee 88
In detail: Frequency Index
Cartiera di Monfalcone Delicarta cartiera Delicarta trasformazione Delipapier (Nancy e Buxeuil) Delipapier GmbH Delitissue Fibrocellulosa Ibertissue Imbalpaper Intertissue Papernet Papyros* Soffass cartiera Soffass trasformazione Sofidel Kagit Werra Papier (Werra, Omega, THP, THP Logistick)
14,02 48,80 16,29 19,88 41,57 28,99 0 13,18 22,41 11,26 38,46 21,88 11,90 15,09 0 35,88
1,08 1,87 0,36 0,41 0,36 0,46 0 0,54 0,74 0,29 1,47 0,14 0,11 0,39 0 0,49
Total Sofidel Group
As shown in the graph, in the last three years, both the frequency index and the seriousness index have undergone a significant improvement. Once again in 2010 the Italian companies in the Sofidel Group obtained, for the 2009 year, a reduction in the average INAIL tax rate, by demonstrating that they have made improvements to workplace safety and hygiene conditions in addition to those required by the relevant legislation; this reduction was equal to 137.298,44 Euro. In all the Sofidel Group companies in Italy, in Intertissue (UK), in Ibertissue (SPA), in Sofidel Kagit (TK), in Delitissue (PL), in Delipapier GmbH (DE) and in Delipapier (FRA) training programmes on health and safety are produced: each category of employee is trained on the risks and prevention and protection measures put into effect and, for each specific job, given on the job training. Other plants in the Group are organizing the production of a more systematic training plan. In 2010 12,616 hours of Health and Safety training were delivered within the Sofidel Group, involving 57.7% of employees. (These data do not include the Papyros company). The main themes can be summarized as follows: • course on the use of fork lift trucks • course for new recruits • courses for supervisors and managers • courses for those working for the company first aid service • course on the use of lifting equipment • course on the use of aerial platforms * Indices calculated on the basis of 11 months 89
• course for fire fighters and emergency workers • course on use of III category PPE • update seminars for RSPP and H&S managers • course on working at height • course on risks of an ergonomic nature, noise and vibration • course on electrical risk. The Group, being sensitive to the health and safety of its employees, has also undertaken significant prevent campaigns as described below: • in Delipapier GmbH prevention campaigns have been carried out on the use of fork lift trucks and ear protectors by affixing posters; • in Delitissue a campaign was held on the prevention of accidents during winter months including those due to ice on the streets; • in the Werra group in order to further increase awareness an agreement was signed between the company and the workers council on a ban on the use of alcohol and drugs in all places of work; • in (Delipapier, FRA) a campaign was used to promote the idea of giving blood. In almost all the companies in the Italian Group formal agreements are in place with the unions representing all the workers on the subject of Health and Safety at Work in order to develop and spread, to all staff, the Safety culture. These agreements are obviously signed at a local level; even at plant level, located in the same region, the requirement shared in the agreements may be different. In the 2009 agreements, signed at local level for the Soffass Converting Plant, Papernet and Imbalpaper, a specific appendix entitled “Observatory on Safe Conduct” was inserted. The aim of this observatory is to address behaviour which is out of line with safety principles and standards and at the same time give value to virtuous behaviour continued over time. In the first phase, 2009-2012, all reports will be counted and the results achieved will be used to determine the objectives for further years. From 2013, the second phase of the agreement, the parties will assess the possibility of transforming the observatory into a parameter to be inserted into the employment contract of the firms involved. In Delipapier (FRA) formal agreements have been signed with the unions, also at a local level, concerning personal protection equipment, training and participation in safety audits. There are currently no other agreements in the Sofidel Group plants. In Sofidel Group companies, excluding the Papyros (GR) and Delitissue (PL) plants, regular meetings are held on Health and Safety. The percentage of employees represented in these meetings is 100% in Italy, Germany, France, Spain and the UK, with trade union representatives also attending. In Sofidel Kagit (TK) meetings are held on health and safety, but the trade union representatives do not attend as this is not required at a national level and the percentage of employers represented is about 10%. Participation by trade union representatives at the periodic meetings on health and safety, together with the plant management, the H&S (Health & Safety) managers and the people in charge of H&S is fundamentally important since, as well as representing all employees, they can analyse and share solutions aimed at improving workplace health and safety. In July 2010 the third International Safety Committee was held in Germany at Delipapier GmbH and the fourth in October at Sofidel Kagit in Turkey. 90
The first and second Committees were held in 2009 in Italy and Spain respectively. The International Safety Committee involves the central Corporate Safety unit and the Health & Safety managers of all the plants within the Group. The main aims of the Committee include harmonization of safety policies, research on new operating methods, methodologies and solutions for reducing risk and therefore accidents in the workplace. Sofidel communicates its Safety culture through the periodic publication of “Working Safely Together” which is distributed to all Group employees. In this, information is published on the various European plants, their targets and the point reached as well as accident statistics.(FOTO) Suitable communication is also present in Intertissue where the newsletter “Keep it Safe - Keep it Green” is published, containing information on how to reduce risks for health and safety and the environment. The newsletter is distributed in all rest rooms and eating places to make it available to all employees; in 2010 6 editions were produced.(FOTO) In July 2010 Sofidel created a new communication channel for Health and Safety for the whole Group with the publication on the firm Intranet of the Safety Forum. This tool has been created in order to roll out across the Sofidel Group Health and Safety initiatives, good practice, accident statistics and any other publications. Lastly, as an example rather than a reflection of its importance, it is worth noting the framework cooperation agreement signed between the Gruppo Sofidel Italia and INAIL on 16 March 2010, aimed at identifying and developing improvement actions relating to health and safety at the workplace. A type of partnership which INAIL has not applied many times in Italy and the first in Tuscany. During 2010 various meetings were held between experts and technicians from the Institute and the Group followed by visits to the pilot sites (Soffass paper mill and Papernet) to define and implement the first area of intervention: mechanical handling/movement of goods, with particular regard to analysis of the operations carried out with forklift trucks to identify the risks and define any model behaviours to be adopted and set up the relevant guidelines.
1.7 Communication and participation For Sofidel the communication process is a tool for transforming the quality of work of staff, allowing for organizational improvement and company development, and contributing to the growth of social wellbeing. Accuracy, clarity, transparency, sobriety and seeking to establish shared values, targets and results; these are our guiding principles. Given the increasingly international composition of the Group and the importance of this tool for growth and development it has been decided to extend the corporate climate survey to all the companies abroad. Accordingly a specific collaboration project has been set up with the Department of Psychology at the University of Florence to produce a suitable survey questionnaire which is scientifically certified and “culture free” (that is, not conditioned by particular cultural backgrounds) to give to all the Italian and foreign companies in the Group. The survey will be taken every two years, because the processing time will inevitably be longer (information on the initiative, translation of the questionnaire, data collection and analysis, presentation of the results and planning of improvement actions) and to allow the operating responses made to the proposals advanced or problems revealed sufficient time to take effect and to be properly perceived. In Soffass, both for the paper mill and converting plant, we have started the “Notebooks for growth” series, 91
The final consumer, for the products on offer, appreciates the characteristics of constancy, quality, convenience and reliability and demonstrates its faith by repeat buying, which is reflected in a rising trend in market share.
devoted to self improvement courses undertaken in the Italian companies of our Group (see paragraph on “Training and staff development”) (FOTO) In 2010 Sofidel created the “Fondo di Solidarietà dipendenti CRAL Sofidel Italia” (CRAL Sofidel Italy Relief fund for employees) This fund was founded as a result of an agreement between Gruppo Sofidel Italia and CRAL Sofidel, in order to guarantee financial support to employees of the Italian companies in the Group (and their immediate family) who, while being properly registered with CRAL and having paid the correct contributions to the Fund, find themselves in a serious and exceptional situation. The Fund, which aims to provide relief and is therefore consistent with Sofidel’s organizational culture and values, is financed, on a voluntary basis, by employees of Gruppo Sofidel Italia and managed by the Relief Fund Management Committee of CRAL Sofidel. The help provided is of an extraordinary nature and not continuous, and is granted on the basis of situations of serious and documented need, resulting from serious events or conditions which impact profoundly on the life of the immediate family. The contributions paid, excluding cases of death or injury after work, are to be understood as loans which the applicant and/or their family can repay in monthly instalments, without interest, through payroll deductions and regular payments to the current account of the Relief Fund. In addition, for Italian employees of the Sofidel Group the activities of the CRAL company social club, a completely apolitical, non party and non profit making association, continue to take place. Detailed information of CRAL Sofidel is available on the site www.cralsofidel.it. Being aware of the importance of communication, the Sofidel Group has completed other important projects, details of which can be found under the paragraph “Initiatives to promote communication and dialogue with stakeholders”.
2 SOFIDEL AND ITS CUSTOMERS The key assets of Sofidel lie in its customers, consumers and distributors. Sofidel intends to build on the loyalty built up over time as a result of its correct and serious relationship with it customers. To distributors and large scale retailers the companies in the Group put themselves forward as product innovators, careful to contain costs and satisfy requirements, ethically correct and respectful of the environment, careful not to offer products with characteristics that compete directly with the company’s brand products; for all these reasons we are known in Europe as ideal partners for the production of private label products. The trust placed in us due to our correctness and seriousness has allowed the Group in recent years to begin presenting the brand even in those countries where we were previously seen only as a producer for third parties/private label. Regina® is now present in Italy, Germany, Poland, France, England, and Turkey and to a lesser extent in some countries in the Balkan area. In recent years we have explored the option of flanking Regina® with other historic brands acquired and present in the various markets, to develop them and earn with their popularity new market share in the Brand channel. We refer to the “Softis” brand for the German and Austrian markets, the “Le Trèfle” and “Sopalin” marks for the French and Belgian market and the “Onda” and “Volare” marks for the Romanian market. The final consumer, for the products on offer, appreciates the characteristics of constancy, quality, convenience and reliability and demonstrates its faith by repeat buying, which is reflected in a rising trend in market share. 94
2.1 Sales channels and market trends To guarantee excellent service and clear lines of contact the Sofidel Group has divided its commercial activities into four channels (Lines of Business): sale of its own brand (Brand channel) sale of private labels for supermarkets etc. and other third party brands (Private Label Channel), sale of products used outside the home (Away from Home channel) and sale of semi-finished goods represented by reels of tissue paper for the converting/transformation market. At the head of each Line of Business there is a European Director (LOB Director) who coordinates the sales and marketing organizations in each area for the relevant channel. The LOB Directors are coordinated by a European Marketing and Sales Director (Chief Marketing & Sales Officer), who reports directly to the Chief Executive Officer). In Italy the companies are also specialized by channel: Soffass markets its own Regina® brand, Delicarta is specialized in the sale of the same products but with the retailer’s label, Papernet markets products for the Away from Home market and Fibrocellulosa and the Monfalcone paper mill sells parent reels to the converting market. This diversification strategy will shortly be repeated in France and Germany, where there are more production plants and where division by sales channel becomes a significant element. During 2010 strengthening of the sales structure has continued, with the addition of new people to the various lines of business, so as to develop and manage in an appropriate manner the growth predicted and achieve the targets set. The fundamental events in 2010 were certainly the acquisition of the LPC group and Comceh, which served to strengthen the production and sales capacity of the Sofidel Group within and immediately adjacent to important markets such as the French, German, English, Scandinavian and Balkan ones. This is the continuation of a well established Group strategy based on three fundamental principles: an exclusive commitment to the tissue sector, use of modern high performance plant and distribution of our production sites on a European basis, close to the markets, in order to contain logistic costs and increase the level of service.
The Sofidel Group has now been present for years in various European markets (Italy, Poland, Germany, France, Belgium, UK, Eire and the Eastern European countries) with the Regina® brand, whose strength is based on a full assortment of toilet papers, kitchen towel, napkins, handkerchiefs and facial tissues. In all these categories, Regina® is characterized by the search for distinctive factors which can better satisfy the real needs of the customer. For toilet paper Regina® offers leading products in terms of the length of the roll, the high level of resistance and softness (Retooling, Carta Camomilla, and Softis). For kitchen towel, Regina® offers products with embossing designed to give greater absorbency, together with prints designed to increase their attractiveness (Asciugoni, Regina di cuori), as well as products which use specific raw materials to avoid the release of fibres when used for cleaning shiny surfaces (Blitz). For the napkin category, Regina® has always tried to improve the image of its own range by working in particular on two or three ply products and improving the quality with embossing and sophisticated decorations to improve the look of the table. Finally, Regina handkerchiefs and facial tissues were the first to be decorated with specific prints for children and presented in attractive and innovative packaging. In some countries, the Regina® brand is flanked with other brands acquired in the course of the last few years, such as, for example, Soft&Easy® in Poland, Yumy® in Turkey, Softis® in Germany and Austria, Le Trèfle® and Sopalin® in France. 95
It is worth noting the activities carried out to relaunch these last 3 brands. As regards the first, we should mention the introduction of the Regina-Softis toilet paper on the main European markets (Germany, UK, France and as a tester in countries like Italy). This revolutionary product, using patented technology which is the fruit of years of research, represents a key strength on which to base future development; to this end, some machinery dedicated to this product has been installed in the English and German plants. For the two brands Le Trèfle® and Sopalin®, acquired at the end of 2009, a relaunch and restructuring of the range was started in 2010 and completed in the last three months of the year. With the acquisition of Comceh in Romania the Onda® and Volare® brands, which are positioned immediately behind the brand leader on the Romanian market, came into the Sofidel fold. In the near future these two product ranges will undergo some “cosmetic surgery” to strengthen their brand image.
The private labels of the big retailers are the real market leaders within the sales point: they are often presented with fantasy names and in some cases with the retailer’s name. The big retail distribution groups entrust the production of their Private Label products to suppliers who can put together quality of product and process (e.g. reliable traceability systems) at a reasonable price. In smaller retailers choice of supplier is instead often determined solely on the basis of price. As part of Sofidel’s sales and marketing organization, it has been decided to include in the Private Label channel, in addition to the retailer’s label, other marks such as Nicky, Valenty, Florex, Daily, Temis, Tyril and Talent. These marks have historically been used as “support marks” for the big retailers, supplied while they are putting the finishing touches to their own brand, and therefore with a relatively short sales life. Among these a development worthy of note is that shown by Nicky, which from 2006 to date has produced a high quality range of products at an average price, becoming the second mark in the Group in terms of quantity sold (the only Group mark sold in the Spanish, Portuguese and Greek markets and complementary to Regina® in all the other markets.
Away From Home
This channel includes products consumed outside the house, such as toilet paper, napkins, industrial rolls, paper towels in various shapes and sizes and the relevant holders for the product. Often articles produced by us are sold together with other marketed products such as hand soap, paper table covers and place mats (this is to provide a full range to the customer, a key success factor in this channel). From the last three months of 2009 and for all of 2010 the marketing has taken place in Italy of a line of coordinated table covers, napkins and place mats which, after a test phase, has been produced as a full range in order to take advantage of the best operating opportunity and to guarantee customers an adequate assortment. There are three AFH marks currently dealt with by the various Group companies: Papernet, sold mainly in Italy, Werra for recycled products and present mainly in Germany and Imbalpaper distributed in various European countries. In 2010 a rationalization study was carried out on the marks in order to identify a single brand to use in all the European countries in which the Group is present.
This channel is represented by the sale of parent reels, mainly to companies involved in transformation both in Italy and abroad, which do not produce paper and which acquire semi-finished products from the Sofidel Group paper mill to convert them into finished products.
2008 3,75 8,57
Composition of turnover by geographic area* (%)
1,31 0,28 1,12 1,82
7,4 13,57 10,05
0,09 0,02 1,53
2010 Area 1: Germany, Austria, Sweden, Czech Republic, Slovak Republic, Netherlands Area 2: UK, Eire, Iceland Area 3: Italy, Malta Area 4: France, Belgium, Luxembourg Area 5: Spain, Portugal, Morocco, Andorra Area 6: Sweden, Denmark, Norway, Finland Area 7: Poland, Estonia, Lithuania, Lithuania, Russia, Belarus, Ukraine Area 8: Romania, Bulgaria, Moldavia, Hungary Area 9: Greece, Albania, Macedonia, Croatia, Bosnia, Serbia, Montenegro, Slovenia, Kosovo Area 10: Turkey, Cyprus, Turkmenistan, Kazakhstan, Kyrgyzstan, Tajikistan, Armenia, Georgia, Azerbaijan, Uzbekistan, Afghanistan, Iran Area 11: Saudi Arabia, Bahrain, Arab Emirates, Kuwait, Iraq, Oman, Qatar, Yemen, Israel, Lebanon, Syria, Jordan , Egypt Rest of the world
*This also includes the companies in the LPC Group and Comceh. The acquisition of LPC and Comceh have considerably increased the weight of areas 2 and 9. Net of these acquisitions the relative weight of the areas would have remained stable compared to the preceding two years. 98
Division of customers by geographical area* (%) 0,3 5,2 5,3
0,2 0,1 Composition of turnover by line of business* (%)
Away From Home Private Label Brand
57,6 0,5 3,5
9,01 1,6 1,1 0,3
0,54 0,37 0,32
7,47 1,43 1,17 0,4 9,07
*This includes companies in the LPC group and Comceh
*This includes companies in the LPC group and Comceh 99
2.2 Sofidel Group products quality and safety Product quality is monitored constantly using an index which takes account of all the non conformities identified during the production process, weighted according to their seriousness.
Index of compliant products (%)*
99,00 98,51 98,99
97,27 97,23 97,27
99,48 96,80 96,96
Delipapier Nancy (FRA)
97,61 95,16 97,78
Delipapier Buxeuil (FRA)
98,54 99,83 99,89
84,65 98,58 99,72
98,45 99,35 98,88
99,39 97,24 98,79 72,53
Delipapier GmbH (GER)
99,32 98,90 91,46 95,74 96,49
* The reporting boundary does not include Papyros and Sofidel Kagit as they do not use this monitoring system. 100
The three-year trend reported above is consistently above 90% and the monitoring therefore confirms our excellent results in terms of product compliance. Both for products made of pure cellulose (the raw material for which is virgin wood fibre) and for products made from recycled paper (the raw material for which is paper mache of various qualities), quality and protection of consumer health and safety are fundamental for the Sofidel Group. In recent years consumers (and consequently distributors) have given noticeably increased attention to the safety aspects of products. This sensitivity, rooted in worries about agriculture and food, has rapidly spread to apply to all products which come into contact with food and persons. The Sofidel Group, which has always included product safety among the values in its quality policy, was quick to take up the opportunity presented to the industrial world by this cultural development. Right from the research and development stage for a new product, the Sofidel Group assesses all the variables which may undermine the safety of the product and thereby the health of the consumer, at every stage of the product life cycle. In this sense great importance is given to the gradual spread within Group plants of the principles established within the BRC-Consumer Products standard, certification which is currently present in 4 plants (which produce 35.81% of Sofidel products). This standard is mainly based on the performance of a risk assessment (using the analytical methodology known as HACCP) on the various production cycles within a plant, so as to remove or reduce the risk of chemical, physical or microbiological contamination. The outcome of this process is the formalization of a system of hygiene-sanitary self checking which checks the safety, legality and quality of products produced, so as to guarantee that the raw materials used, the buildings and the operating methods adopted to produce and store the products are sufficient to prevent them from being contaminated. The traceability system in the Groupâ€™s converting plants then enables us to guarantee the quality and safety of products at the distribution stage, ensuring that they can be recalled if necessary. In order to ensure product safety and give external support to the tests carried out internally within Group laboratories, systematic analyses are carried out at accredited external laboratories on all the products made by the Sofidel Group. These analyses are of a physical/mechanical and a chemical/microbiological nature (in particular tests of suitability for use with food, bacteria count, presence of mould and yeasts, heavy metals, colour transfer, formaldehyde and pentachlorophenol). To demonstrate the attention that the Group pays to consumer care there is a total absence of cases of non compliance with the legislation and standards regarding the impact of products on consumer health and safety.
The Sofidel products covered by the national and international standards relating to contact with food (for example EC regulation 1935/2004) are kitchen towel and napkins. In these products the inks used, with reference to directive IEN 646, do not migrate towards the products with which they come into contact, or modify their organic properties; moreover they do not contain heavy metals such as mercury, lead, cadmium or chromium, considered harmful based on standard EN 12497-12498. In products where they are used, the perfume essences are free of added allergens and can therefore be used in contact with the skin in accordance with Chapter V11 (amended) of directive 76/78/CEE. To carry out tests at accredited outside laboratories, companies in the Sofidel Group spent 94.000 Euro in 2009 and 116.144 Euro in 2010.
2.3 Customer satisfaction Customer satisfaction is one of the main targets of the Sofidel Group. In the course of the year we surveyed the level of satisfaction with the product and the service using a unified questionnaire which all the companies in the Group sent to their most representative customers. The parts subject to evaluation relate to communication, the product and sales match. In 2010 of 732 questionnaires sent, 203 were returned, a percentage of 27.7%. The forms returned represented 35.3% of the turnover of the Sofidel Group. In the future the target will be to bring these two percentages to at least 50% for both indicators so as to obtain more representative data than that currently available. The weighted average for the Group from the replies received from customers by type of demand is expressed as follows: Customer satisfaction
Is it easy to communicate with our offices? Is the behaviour of our staff (courtesy and attitude) satisfactory? Do our staff have sufficient skills to respond to your requests? Is the response time for your requests satisfactory? Are orders fulfilled satisfactority (errors or missing products)? Is the delivery time satisfactory? Is the level of our products satisfactory? Is the quality level of our products consistent across different types of supply? Is the information on the packaging satisfactory (only for SOFIDEL brands)?
The importance of this survey tool is given by the fact that the analysis of the replies will allow us to see the customer evaluation of how far we match their requirements and the importance that the customer attaches to each requirement. The results obtained are positive compared to the data for 2009 (3.9) given that the global average of the evaluation is 4.04 points out of a maximum of 5. From 2012 a new tool for CRM (Customer Relationship Management) will be used. The surveying of Customer Satisfaction using the questionnaire is the result of a special project coordinated by expert tutors from SDA Bocconi which has involved many Group managers from the various European countries. The target to be achieved is to successfully monitor, for each area, a number of customers which represents at least 50% of turnover. Monitoring of customer satisfaction is also continuing using other tools such as: â€˘ Collection of customer complaints Reports and complaints from retail customers and consumers are received by the Quality division or the Marketing & Sales area of the Group. The latter, in particular, since 2010, analyses and manages the 102
6,95 7,33 48,06 8,68
Group complaints by type (%)*
Detail of calls to the free number (%) Reward not received Information Other
Element Problem Packaging Problem Neck problem Pallet problem Other Legend: Element Problem: for example folds too stuck down, holed paper, dirty paper Packaging Problem: for example packaging not welded properly, package weight incorrect Neck problem: for example broken neck, bad smell, box closed in the wrong manner Pallet problem: for example non compliant pallet, wrapping of pallet non compliant, dirty pallet Other: generic complaint relating to poor quality or interruptions in quality
collection of complaints with the cooperation of the various company functions involved, in order to identify the cause of the dissatisfaction and the critical factors. To improve the management of the collection and analysis of customer complaints, during 2010 a new SAP function was developed which will allow this to be managed more flexibly and efficiently. During 2010 a total of 1625 complaints were received. â€˘ Collection of complaints from consumers through the free number The collection of reports from consumers is part of the channel of dialogue implemented by the Company to establish a direct link with customers for the ReginaÂŽ product; such reports are reviewed by the Marketing unit, at the moment only in Italy, in order to better understand the needs of the final consumer. A direct line to the consumer is ensured, therefore, by the existence of the ReginaÂŽ free number. In 2010 4431 telephone calls were made to the free number, 1249 less than in 2009, of which 28.2% related to non receipt of rewards, 69.6% to product information and 2.2% for all other types of query.
*This report excludes Sofidel Kagit
2.4 Dialogue and communication with customers The presence of the brand in several European countries requires promotional activities and communication of a different scale and impact; over time Regina® has carried out intense marketing activity not only in Italy where historically advertising and promotional pressure has been very high but also in other countries where the brand is showing itself to be a strong player such as Germany and Poland. In other countries, where our presence is just starting and distribution is not fully covered, activities are directed at building loyalty and familiarity with the product using competitions, on pack gadgets, highlighting the product on the shelves, point of sale activities and co-marketing, attractive decorations on packaging and products and advertising pages in sector magazines. In the course of 2010 it was decided to extend advertising to other countries such as Croatia, Slovenia and France. In the latter country communication was targeted at supporting the relaunch of the Le Trèfle® brand acquired at the end of 2009 by the Sofidel Group. The accuracy of the communication carried out by the Sofidel Group, which uses as a reference the advertising ethics set out in the Self Disciplinary Code for Commercial Communication, is reflected in advertising campaigns which always highlight an advantage easily identifiable by the consumer. In fact, right from the time of the first Regina® advertising campaign in the 80s, the messages have always emphasized the qualifying characteristics of the various products, highlighting concepts such as length, resistance, softness, absorbency and hygiene. From the viewpoint of a transparent relationship with the consumer, communication on packaging also needs to be looked at. The regulations require that the product label contains information on the amount of content in the package and the address of the producing company. Exceeding these requirements, in 2009 a specific programme was started to unify the information on product packaging for the Regina® and Nicky® brands which has continued in 2010, reaching the point where 73% of products now comply with the new rules. In particular 79.8% Regina® products and 59.3% of Nicky® products comply with the rules. The information included on our products is as follows: • number of rolls per pack; • composition of the raw material used; • product category; • recycling instructions and abbreviation for the packaging material; • product website; • note on ownership of the brand giving the name and address of the company, Sofidel, which distributes the product; • SOFIDEL logo and site. This uniformity will be extended to the full range of brand products as packaging is modified, replaced or renewed over time. We expect to achieve this objective at the end of 2011. For Private Label products, the Sofidel Group cooperates with the customer distributor on the overall 106
labelling of the products however the final choice of what to include on the product is made by the customer. As regards Away from Home products, this work has not yet started as it is planned to completely revise the packaging during 2011. In addition, another important channel for dialogue with customers is provided by the collection of reports and complaints (see paragraph on “Customer satisfaction”). With reference to product responsibility, in particular to product labelling, marketing communication, privacy and compliance, it is worth highlighting that in 2010 the Sofidel Group did not record: • any breaches in relation to failure to place on products the information required by current legislation; • complaints concerning breaches of advertising standards • sanctions for violation of the rules on customer privacy; • sanctions for failure to abide by product standards. Also in relation to competition law there have been no definitive judgements to date, although there are some cases pending.
3 SOFIDEL AND ITS SUPPLIERS SUSTAINABLE MANAGEMENT OF THE SUPPLY CHAIN Given the large number of suppliers and the volume of materials and services purchased, close attention to the relevant sustainability profile is not only a social responsibility for the Sofidel Group but also represents a significant opportunity in terms of improving operational performance. In the current economic context, ethical checks on the supply chain form a critical element of the company’s way of doing business. Accordingly during 2010 Sofidel adopted a new policy for management of the supply chain in accordance with sustainability criteria. The sustainable supply chain management policy has its roots in the Group’s Ethical Code, the principles and values of which formed the basis for the “Supplier Guidelines”. Using this document Sofidel gets suppliers involved in helping the Group to meet its objectives, while evaluating their social and environmental performance. The “Guidelines” have been translated into all the languages of the Group and distributed to suppliers. In addition, the policy is available on the company web site www.sofidel.it. In order to check compliance with the Ethical Code within its supply chain, Sofidel has drawn up, based on the “Supplier Guidelines”, relevant self assessment questionnaires including relevant aspects such as: - health and safety - environmental aspects - respect for human rights and employee rights - governance. These parameters have been taken from the standards and principles widely recognized at an 107
international level (the Global Reporting Initiative, the UN Global Compact and standard SA8000). The monitoring systems used in Group companies are supplemented or replaced by these questionnaires, the aim of which is ultimately to provide standard tools to the various purchasing management units to help them to standardize, increase the efficiency of and apply ethical checks to the supply chain. To support suppliers in understanding and filling in the questionnaire an appropriate “Suppliers Team” was set up in Sofidel. This Team was required to: - oversee and coordinate the project; - analyse and report on the data collected; - intervene in the case of non compliance with Group policies with corrective actions, or if this is not possible, termination. The questionnaire is now available in 5 different languages (Italian, English, French, Spanish and German) and was distributed in January 2011 to the main suppliers of pulp, services and technological equipment. The first results of this stakeholder engagement may be ready from September 2011. With particular reference to the protection of human rights, the questionnaires incorporate respect for fundamental standards such as those set by the ILO international convention, the UN Declaration of Human Rights and OCSE Guidelines. In addition, the detail deals with specific legislative requirements relating to: freedom of association, ban on child labour and forced and compulsory labour, the absence of discrimination, satisfactory working conditions and training and development. Particular attention is also devoted to Health and Safety at the workplace with reference to the OHSAS 18001 management system and risk assessment systems.
3.1 Supplier qualification and analysis The main suppliers of the Sofidel Group can be subdivided into: • suppliers of raw materials and other consumables • suppliers of services (transport, energy and consultancy) • suppliers of technological plant and other fixed assets. The management of relationships with suppliers is kept at a central level by the relevant purchasing management units, which deal with the contracts; subsequently the order will be managed by the purchasing managers present in the various departments. Supplier evaluation is carried out in a preventive manner, in the case of new suppliers, and then in a continuous manner for those already in use, both through the use of performance indicators and through monitoring in the form of inspection visits. The Sofidel Group has subdivided its qualified suppliers on the basis of the criticality of products/services supplied; companies in the Group monitor the efficiency of their critical suppliers taking into account any non conformities identified (and their seriousness) on products acquired in relation to the quantity purchased. In fact, the selection criteria used by Sofidel, in addition to economy, are based on evaluation and performance monitoring and the supplier’s ability to meet Group requirements in terms of products and services supplied. 108
From 2005 to 2010, 34 checks were carried out on qualified suppliers, 14 of which took place in the last year; these checks also covered areas related to social responsibility and hygiene/sanitary aspects. The cost impact of pulp purchase means that suppliers of raw material represent 58.54% of purchasing costs; for this reason the Sofidel Group relies on the major international producers (see paragraph on “Responsible purchasing of fibrous raw material”) The other types of supply are mainly of a “historical” type, that is, are long term and, where possible, the suppliers are located in the country or countries where the Group has its plants. The concentration of expenditure on local suppliers was, in fact, 46.42% overall in 2010.
Raw materials and other goods Services Plant and other fixed assets
Sofidel Group expenditure on suppliers 2010 (%)
Concentration of expenditure on local suppliers 2010 (%)
Concentration of expendition on local suppliers by type (%)
Raw materials and other goods Services Earnings
* “Local” means suppliers located in the same country as the Sofidel Group plant 109
Recourse to a Group purchasing strategy does not mean that Sofidel does not use domestic suppliers; in fact, often, because the negotiations are carried out by the corporate purchasing office, preference is given to local firms in the choice of supplier. That is, while on one side this involves optimization of the service and a consistent financial saving (due for example to reduced transport costs) on the other hand it has allowed us to create positive economic and social fallout in the host countries. It is sufficient to think of all the suppliers in the vast area of maintenance (electrical, mechanical and building) where the choice, in the vast majority of cases, falls on small or very small local firms. The high concentration of expenditure on local suppliers is even more evident in the new countries into which the Sofidel Group has extended its activities: while exploiting the obvious synergies made possible by a Group purchasing policy, where it is possible to use domestic suppliers they are used, allowing us to have a significant positive social and economic impact in these new areas.
4 SOFIDEL AND THE COMMUNITY The Sofidel Group promotes continuous dialogue with the community, recognizing and valuing its rich cultural, social and environmental heritage and diversity. In line with the values of responsibility and transparency and the commitment to sustainability, work is undertaken to raise the overall quality of people’s lives through actions to support development in the social, cultural and environmental arena in the areas where we work. This objective is also pursued through the relationship with the Fondazione Giuseppe Lazzareschi (see paragraph on “La Fondazione Giuseppe Lazzareschi”) and other not for profit organizations.
4.1 Direct social contributions in the various areas of intervention Each new investment made by the Sofidel Group is based on a feasibility study, carried out by an appropriate project committee composed of the top managers of the Group. Together with local authorities and the relevant bodies, the availability of the resources required to complete the project is checked and local regulations analysed. Following the acquisition of the LPC group, to address and manage in a satisfactory way, both on the internal front (employees) and on the external front (institutions, unions, customers and suppliers) the delicate period of transition, specific Group teams were set up in the countries where the company was present (Great Britain, France, Belgium and Sweden). Following the due diligence work, each step in the acquisition was carefully evaluated in advance. Specifically, the change in ownership, before being communicated externally, was communicated to the unions and to the work force of the new companies (including via a specific communication signed by the Group CEO) and following this all the members of the Executive Committee of the Company went to the plants for direct contact with the local units, evaluating their needs, listening to their requirements and offering, based on a logic of transparency and collaboration, all the information necessary to become familiar with the world of Sofidel. The Group then sent the local authorities and new customers acquired two specific letters providing information on the acquisition and demonstrating the Group’s desire for the broadest cooperation. As regards “social investments”, the Group does not pursue only the company’s immediate interest, but also works to provide benefits for the wider community. From a long term viewpoint work is carried out in the areas of social assistance, educational infrastructure, production infrastructure, improving railway and road mobility and improving discharge and cleaning systems for water. 110
In the course of 2010 the start up of the cogeneration plant at the Delitissue plant in Ciechanow (about 40,000 inhabitants) in Poland was particularly important. The plant consists of a new generation gas turbine (producer Solar Turbines, model Mercury 50, electrical power 4.5 MW) which can cover the entire electricity and steam requirement of the plant and contribute during winter months to the supply of hot water to the heating system of the town of Ciechanow. Accordingly Delitissue has signed a specific supply contract with Przedsiebiorstwo Energetyki Cieplnej Spolka, the company which manages the service. Sofidel is waiting for RFI (Reti Ferroviarie Italiane), the contracting party for the works, to construct the rail connection to the Delicarta converting plant at Capannori (Lucca), thanks to which the railway will come right up to the plant warehouse, allowing easier use of rail for the transport of goods, with obvious positive fallout in terms of financial and environmental impact. The project forms part of a wider project started in 2008 by numerous public entities to produce an intermodal station to serve the industrial district of the Plain of Lucca. The Sofidel Group is directly bearing the costs of construction of the rail branch with an expenditure of 3 million 900 thousand Euro. The activation of the infrastructure as covered by the relevant programme agreement depends on RFI. In 2010 a contribution was made to the Arciconfraternita Misericordia di Montecarlo (Lu) to construct a multifunctional reception centre. The project has received the approval of the Area Branch of the Mayorâ€™s Conference USL 2 Lucca and is financed by, among others, the Region of Tuscany. The structure is intended to respond to the needs identified from an analysis of the inhabitants of the municipalities in the Lucca Plain, with particular regard to rehabilitation services and integration of persons with a physical handicap (whether permanent or not), young people and the elderly. In the sporting arena the Sofidel Group has supported the Lucca football team Libertas (playing in the First Division), which is the team for the capital city of the province where the company has its base (Porcari), by purchasing advertising space inside the stadium. The Sofidel Group has, moreover, with the Regina brand, become part of the pool of sponsors of the Montepaschi Mens Sana Siena, the basketball team which currently tops the Italian Championship League and the holder of the Coppa Italia and Supercoppa Italia and Pallacanestro CantĂš, Lega Basket Serie A, one of the great teams in the tradition of Italian basketball (three Scudetti, two Champions cups and four Korac cups). The partnership between the companies in the Group, the wider community and the home country constitutes a real coalition of interests between parties who have voluntarily formed mutually advantageous and innovative relationships, pursuing a common social objective: to improve the quality of life of the members of the society in which the partnership is set, through integration of resources and skills. Social interventions by the Sofidel Group (euro)* Free payment of which payments for the Fondazione Giuseppe Lazzareschi of which support for WWF ITALY Sponsoring
195.709 50.000 218.999
249.174 50.000 125.000 117.913
278.534,36 50.000 70.000 198.647,20
*Includes companies within the LPC group and the Romanian company Comceh 111
Also to be considered as part of social work is the compulsory Social Solidarity Contribution applied currently by the State to firms based in France, Germany and Belgium. This contribution is calculated as a percentage of turnover and set aside for state solidarity funds which are then used by national bodies which carry out public service missions. During 2010 this Contribution totalled 431.793,92 Euro. The companies in the Sofidel Group take part in sporting and cultural initiatives proposed by local committees and organizations by making available people and equipment to carry out the initiatives, by donating products to distribute to the participants and, in a small way, by giving money. In addition, the Sofidel Group takes part in charity initiatives, financially supporting organizations giving assistance, such as the Croce Verde (Green Cross) in Porcari and giving contributions for the Lucca Hospital, donations for family homes and help with other worthwhile initiatives. It is worth highlighting that particular attention is paid to the protection of human rights as part of investment practices and supplier selection. During 2010, checks were carried out on the main supply contracts using specific questionnaires. In particular, the subject of respect and protection of human rights was given more emphasis (see paragraph on “Sofidel and its suppliers”). In addition, as regards supply of our main raw material (pulp) the percentage of agreements signed which contain a clause on respect form human rights is 31.55% .
The Giuseppe Lazzareschi Foundation The Giuseppe Lazzareschi Foundation was inaugurated at Porcari (Lucca) in November 2003, 10 years after the death of Giuseppe Lazzareschi, founder, together with Emi Stefani, of the Sofidel Group. The Foundation is active in particular in two sectors: the socio-cultural arena and enterprise finance. As regards the first, during 2010, the Foundation presented the personal work of the sculptor Stefano Graziano, “Lacerations”; an exhibition of paintings by Pietro Soriani, “Interior journeys”; and an exhibition by the Japanese artist Hiroaki Asahara, “Capturing light and air”. The exhibition “Etruscans, the charm of a civilization” was of particular importance. The socio-entrepreneurial sector instead saw the consolidation of the “Objective Zero” and “Start Up” initiatives and the successful repeat, for the fifth year running, of the competition linked to technological innovation “Technology and Passion. Prize for innovation 2010”. It was the first anniversary, instead, for the Technology and Passion Club, which collects the examples of excellence awarded by the initiative of the same name.
CULTURAL SECTOR “Etruscans, the charm of a civilization” The exhibition, the only one of its type in the country, illustrated for scientific and educational purposes various aspects of Etruscan civilization: the family, everyday life, luxury, but also trade, arms and religion. On show were objects from the Archaeological Museum in Florence and archaeological sites in and around Lucca, in many cases never before seen by the public.
“Lacerations” works by Stefano Graziano An exhibition of “structure-sculpture” made of paper mache and marble dust, inserted in sheets of Plexiglas and fixed on a red travertine base. A reflection on space in perfect harmony, given the materials used by the artist, with the Palazzo di Vetro (Glass Palace) which forms the headquarters of the Foundation. “Interior journeys” by Pietro Soriani Forty works, including oil paintings and watercolours, as well as sculptures in stamped paper, with vivid chromatic combinations. A fantasy voyage through the emotions and “feelings” of the artist, through the intense yellows and reds, the vigorous, dynamic and luminous marks which create the essential elements of the landscape of Soriani where the subjects, whether animal or human, move as if suspended from invisible threads. “Capturing light and air” by Hiroaki Asahara Promoted by the Cartasia association, with the contribution and cooperation of the Fondazione Lazzareschi, Capturing Light and Air presented some of the works created by Asahara using washi paper, the traditional handmade Japanese paper of ancient times. The exhibition was organized as part of Cartasia, an artistic biennial devoted to paper, which is held in the Town Hall of Lucca and in other municipalities in the Lucca plain including Porcari. SOCIOECONOMIC SECTOR As part of its work to promote financial and enterprise culture, the “Start Up”, “Target Zero” and “Technology and Passion” projects were consolidated. With Start Up the Foundation intends to promote the spread of entrepreneurial culture and encourage the birth of new enterprises on national soil, supporting the formation of neo-entrepreneurs and offering support of a financial nature. The “Target Zero” project to raise awareness of and promote safety, now in its sixth year, has now been consolidated at a national level to such an extent that its social value has been recognized with a medal from the President of the Republic. Participation by the Italian company’s paper mills and converting plants in the initiative, which aims to raise public awareness of the problem of workplace safety and to spread a culture of health and safety, has been high as ever. As usual, in May, a well attended ceremony was held to award the companies and employees who, during 2009, recorded a reduction in the number of accidents or reached the target result of “zero accidents”. It was the fifth year of “Technology and Passion award for innovation”, the event which brings together excellence in the technological and industrial field, won this year by the company Omet (Lecco, Italia). “Technology and Passion” is an award for companies and entrepreneurs who have not settled for the status quo but have been able to seek out, with intelligence and determination, new solutions. Also in 2010, during the demonstration which took place in October, coinciding with the last day of the Miac 113
(Mostra Internazionale dell’Industria Cartaria - International Exhibition of the Paper Industry) awards and prizes were awarded to those who, thanks to their everyday work and their passion, have distinguished themselves in the sector of technological innovation, resulting in success for the sponsoring firm. Club Tecnologia e Passione (Technology and Passion Club) Founded in 2009, it brings together the examples of excellence in the technological field which have received the award of the same name, together with the companies who, over the years, have supported and asked for them. In June 2010 the Club celebrated its first year of life and for the occasion proposed, to members and non members, an exciting and well appreciated “outdoor” day devoted to the discovery of new and old technologies which have contributed to the history of the car. It was taken part in, among others, by the Lamborghini Museum in Ferrara and the Museo del Patrimonio Industriale in Bologna.
4.2 Activities aimed at the world of education and research The Sofidel Group, in line with the principles of the Italian Constitution (art. 9, comma 1) and the international conventions, starting from the Universal Declaration of Human Rights, art. 26, recognizes and promotes the high value of education, culture, and scientific and technical research aimed at improving the economic, social and environmental performance of its companies. Schools, universities and research centres represent privileged places for training and growth and pursue a function of fundamental public interest by spreading knowledge and research to raise the civil and economic standards of the society. The corporate strategy of the Group aimed at the world of education and research is based on two fundamental elements, that of increasing resources and skills and encouraging innovation and competitive advantage. In this framework the Group tends to form partnerships which include: • Agreements on work experience for graduates/new graduates NIn 2010 within the Sofidel Group 38 work experience placements were granted involving both university and secondary school students. Moreover, various corporate areas made themselves available to help with information and data for students who had requested documentation and material as part of preparation for exams or degree thesis. It is worth notice that over the years many periods of work experience, once reaching their end, have been transformed into definitive stays within the companies in the Group.
AGREEMENTS WITH UNIVERSITIES • UNIVERSITY OF PISA (I) - Faculty of Engineering, Chemical Engineering, Industry Chemistry, Economics, Sciences, Mathematics, Physics and Natural and Material Sciences; Political Science • Faculty of Letters and Philosophy; Masters in Business Administration (new course in English) • Luigi Bocconi COMMERCIAL UNIVERSITY – Milan (I) • FLORENCE UNIVERSITY (I) • UNIVERSITA’ LA SAPIENZA DI ROMA (I) – Faculty of Psychology • LIBERA UNIVERSITA’ INTERNAZIONALE DEGLI STUDI SOCIALI (LUISS Carlo Guidi) – Rome (I) • NANCY UNIVERSITY 2 (FRA) - INSTITUTE FOR CORPORATE ADMINISTRATION AND MANAGEMENT • Bergamo University (I) • Universidad Publica de Navarra (E)
• Joint research projects and technology transfer A particularly important role is played by the European project known as “CHAT” (Control of Heterogeneous Automation Systems) in which Sofidel is a partner thanks to the contribution of its technical experts, presented in the month of October 2008 at the Faculty of Engineering in Pisa. The Project involves important European firms including SIEMENS, ELSAG DATAMAT and now SELEX (Finmeccanica Group) and is coordinated by the Centro E. Piaggio in Pisa. The academic part involves the most prestigious European universities ranging from the Universities of Pisa, Lecce, Trento to the University of Lund in Sweden and finally UCL in London. The project, of three year duration, is to develop technologies to network together the various components of an industrial plant and so enable them to interact intelligently and independently using new software and algorithms. The conviction of the creators of the project is that the automation of industrial systems may represent a decisive element for an increase in safety in the sector, without undermining productivity. The plants of our Group are the testing bench for the new system of automation talked about by CHAT. To date, after two years of activity, the research project has had significant recognition at an international level due to the documents produced for the attention of the scientific community (further information is available on the site www.ict-chat.eu, in the papers section). Since April 2010 Sofidel has taken part, together with other companies in the sector, such as Fibria, Sodra, Mesto, Billerud and Rexcell, in a research project coordinated by INNVENTIA (ex STFI-Packforsk – Stockholm) called the “Tissue Research Cluster”. The project has a three year duration and involves in depth research into various subjects linked to the tissue area. Of particular interest is the study of the characteristics of the various types of commercial pulp with the aim of optimizing the dehydration process during the paper production phase and consequently reducing energy consumption. An important focus of the project relates to evaluation of new methods for structural characterization of paper with the aim of improving the functional properties (such as for example absorption and softness) of the paper product. • Specialized consultancy on development and innovation initiatives In the course of 2010 Sofidel and Inail (the National Institute for Insurance against Accidents at Work) signed a framework partnership agreement aimed at identifying and developing actions to improve workplace Health and Safety. The development of the partnership will be monitored by a special Equality Commission (composed of experts and technician from the Institute and the Group) with the involvement of and periodic information on the progress of works from the Worker Safety Representative (RLS) and the unified union representative (RSU). The agreement also provides that the final results can be used for scientific ends and that Inail may use the data and results to carry out its own institutional activities of assistance, training and information. (See paragraph “Relationships with Industrial Associations, Chamber of Commerce, Regulatory Bodies”) • Participation in other high profile university projects The Sofidel Group is often contacted to contribute to university degree and/or masters courses, in particular at the University of Pisa and the University Bocconi in Milan, with which Sofidel has most contact.
4.3 Relationships with local, national and international government institutions The Sofidel Group believes in partnership and cooperation with government institutions which it sees as essential partners for the development and regulation of a competitive and socially correct environment, in which is able to protect enterprises and customers from unlawful conduct or conduct which is harmful to the collective good. Accordingly it has a policy of local integration which is applied in its companies through dialogue and willingness to cooperate with the various institutions present, respect for local culture and human rights, pursuit of its function as an engine of development in the area in question and preferential recruitment of people from the local community. Companies in the Group do not make any direct or indirect contributions to parties, movements, committees or organizations of a political or trade union nature, or to their representatives. As regards public funding received by the Group in 2010, emphasis should be given to decree law number 78 2009 which introduced the Tremonti-Ter, providing for incentives to companies in the form of tax relief on structural investment in the purchase of machinery and equipment. Delicarta, Soffass and Papernet are the three Group companies which have benefited in a significant way from these subsidies. As already described in the 2009 Sustainability Report, the Italian companies in the Group benefited in 2010 from a lower rate of INAIL contributions, having invested in safety to an extent exceeding that required by law. This relief has produced a significant saving in contributions for Soffass, Delicarta and the Monfalcone paper mill. Also of note for 2010 is the contribution that the Delicarta company received from the G.S.E. (Gestore Servizi Elettrici - Electrical Services Operator) following the activation of the photovoltaic plants. The company has also benefited, from the region of Tuscany, from tax relief on IRAP due to its having obtained EMAS certification. A reduction in IRAP was also obtained by Imbalpaper for the achievement of ISO14000 certification. In Poland, Delitissue took advantage of tax relief from duties on property wealth.
The French company Delipapier, finally, received contributions from government bodies for the employment of apprentices/disabled persons.
Loans/subsidies received (thousands of euro)
IBERTISSUE (E) DELIPAPIER GmbH (DE) INTERTISSUE (UK) DELITISSUE (PL) DELICARTA (ITA) DELIPAPIER (FR) IMBALPAPER (ITA) SOFIDEL (ITA) CARTIERA MONFALCONE (ITA) WERRA (DE) FIBROCELLULOSA (ITA) PAPERNET (ITA) SOFFASS (ITA)
207 20 2.054 434 40 13 78 -
6 457 250 164 748 64 16 -
157 757 76 37 6 78 31 536 687
4.4 Relationships with industrial associations, chamber of commerce, regulatory bodies The Italian companies in the Sofidel Group are associated on a voluntary basis to the Industrial Association and the Confindustriale System and in particular to the Assocarta association. Confindustria, based on its statute, aims to contribute, together with political institutions and national and international financial, social and cultural organizations, to the economic growth and social progress of the country. To this end Confindustria represents the needs and proposals of the Italian economic system in its relationship with the principal political and administrative institutions, including the Parliament, the Government, the trade unions and the other social forces. The Sofidel Group is also a member of the ETS (European Tissue Symposium) and the CEPI (Confederation of European Paper Industries). The Sofidel Group took part in the â€œAssociative project on work safety management systemsâ€? proposed by Assocarta, the paper industry association which represents the companies which produce paper, cardboard and paper paste in Italy. The project was established with the aim of producing a methodological and operational project pathway which would make available to the paper sector a series of tools, solutions and opportunities to encourage the spread of safety management systems, to reduce their cost and simplify their implementation. For the project a Steering Committee was established by some companies in the sector, both for the production of the guidelines and for the models and procedures. The Sofidel Group has participated in the initiative by offering its experience in the health and safety field, best practice and OHSAS 18001 certification. The Steering Committee has met 8 times at the Assocarta headquarters. In June 2010 the Steering Committee approved the final version of the guidelines, models and procedures. The project was presented as part of the Miac during a seminar on safety organized by Assocarta. Of key importance was the signing, on 16 March 2010, of the framework agreement on cooperation between 117
the Gruppo Sofidel Italia and INAIL with the aim of identifying and developing improvement actions relating to health and safety at the workplace. (See paragraph on “Workplace Health and Safety”) The Group also has good relations with the Chamber of Commerce, Industry, Crafts and Agriculture, a public body with a strong historical tradition, which offers a true system of services for company development and employment, including useful organizational tools. Sofidel Group staff take part in committees and work groups of the aforementioned associations, founded with the purpose of study and improvement to bring benefits in terms of knowledge, training and improvements in the financial situation and image of the paper industry and of the companies that make it up, encouraging sustainable behaviour by all the parties involved, in particular the institutions. On 17 May 2010 the CEO of Sofidel Luigi Lazzareschi was invited by Connie Hedgaard, European Climate Commissioner, to take part in Brussels, together with other leaders of enterprises distinguished in the environmental field, in a round table dedicated to the transition to a green economy. The meeting, significantly entitled “Leading by Example” touched on themes relating to the new horizons in terms of development of low carbon emissions and the problems which threaten to limit the European lead in this field, with reference, in particular, to the public policies which need to be developed. questo campo, con riferimento, in particolare, alle necessarie politiche pubbliche da sviluppare.
Company responsibilities of Sofidel Group personnel Luigi Lazzareschi (Sofidel, ITA) Member of the Presiding Committee of Assocarta Member of the Lead Group of the Industrial Association in Lucca Member of the CEPI Board (Confederation of European Paper Industries) Member of the Advisory Board of the European Tissue Symposium Frederic Andrè (Delipapier, FR) Member of the Environmental Commission of the Hygiene Group Member of the Energy Commission for the paper mills of Eastern France Damien Bresson (Delipapier, FR) Member of the Human Resources Commission for the paper mills of Eastern France. Chairman of the National Association of Directors of Human Resources Loraine Centre Jean Paul Cussenot (Delipapier, FR) Chairman of the Eastern France paper mills Group Vice Chairman of the Hygiene Group Vice Chairman of the Industrial Association of the Val de Loraine Entrepreneurs 118
Riccardo Balducci (Sofidel, ITA) Member of the Technical Commission of the European Tissue Symposium Member of the Safety and Environment Technical Committee of the Industrial Association of Lucca Member of the Board of Directors of the public water cleaning company Aquapur SpA Pier Luigi Bartolini (Sofidel, ITA) Member of Indicod-Ecr Italia, the Italian association which brings together all the industrial and retail companies in the broad consumer goods sector Enrico Belmonte (Sofidel, ITA ) Member of the Technical Scientific Committee of the Industrial Association in Lucca for the tissue sector Giuseppe Gianotti (Sofidel, ITA) Member of the study group of the European Tissue Symposium Gildo Giorgi (Sofidel, ITA) Company representative at the Italian brand promotion association Centromarca Fausto Martinelli (Soffass, ITA) Provincial chairman of the Lucca Confindustria Sports Association Alfredo Scipioni (Sofidel, ITA) Member of the Safety Committee of Assocarta Member of the Technical Scientific Committee of the Industrial Association - Lucca Barbara Pieroni (Sofidel, ITA) Member of the Safety Committee of Assocarta Tommaso Valente (Sofidel, ITA) Member of the National Management Committee of Assocarta Member of the Local Committee for the Masters in â€œPaper productionâ€? at the University of Pisa
IMPROVEMENT TARGETS Human Resources What we said we would do in 2010
What we did in 2010
Completion and roll out, by 2011, of
Completion of the process of revising
the Group reorganization project for
the macro and micro organization of
the definition of roles, integration
between functions and minimization of
efficiency and well-being at work
What we will do in 2011
Company climate: partnership with Completion of the Organizational
the university of Florence for a
single climate survey model to be
and measurement of the results
extended to all the companies in
Production of communication plan -
Planning and implementation of
structural and organizational part
work to improve the circulation of
information within the Group
Formalizzazione della Carta della
Completion of the charter
Publication of the charter
â€œBuona Leadershipâ€? Group Training Plan: definition and mapping of the process which will lead to the drawing up of the Group Training Plan Installation and activation of a system for identifying training costs for all the Italian companies
Obtain OHSAS 18001 safety at work
OHSAS 18001 certification of the
certification for the other plants in
Fibrocellulosa (ITA) February 2010
the Group (at last three by 2011) Started integrated implementation
OHSAS 18001 implementation in
of the OHSAS 18001-ISO 14001
at least one further production
certification at the Ibertissue plant
(Spain) Created an international forum on Health and Safety: a new communication tool within the Sofidel Group 120
On 16 March 2010 a cooperation
Further visits aimed at defining the
relevant guidelines for reducing
INAIL and the Sofidel Group
risks arising from the mechanical
(ITA). During 2010 various meetings
handling of goods
were held followed by visits to the pilot sites (Soffass paper mill and Papernet) to define and implement the
mechanical movement of goods
Created a new method for data
Maintenance and implementation
collection, for statistical purposes,
in other plants
for calculating accident indices
Obtained reduction in the rate of tax
A similar procedure to obtain such
INAIL OT24 - MAT for all the Italian
reductions will also be applied in
plants compared to 2009
What we said we would do in 2010
What we did in 2010
What we will do in 2011
Update and develop the sustainable
Bring on line the “Soft & Green”
development strategy in the light
newsletter devoted to sustainability
of the process of “stakeholder
and aimed in particular at the external
stakeholders of the Group
Develop CSR governance to improve
Establishment of a CSR Corporate
the efficiency of the management
process for sustainable development
Establishment of a Reporting Team to
draw up the Sustainability Report and to apply the guidelines produced by the CSR Committee Establishment of local CSR Committees
for the foreign companies in the
to and coordination of the local
CSR Committees in the foreign
Start of the Group’s Sustainability Plan
Adoption and roll out of the Charter for Equal Opportunities at the Workplace Approval and roll out of the
Start of materiality analysis Development
communication campaign devoted to sustainability Launch
communication campaign on the subject of sustainability Revision and updating of the Ethical
New Ethical Code for the Group
Roll out of the new edition of the Ethical Code and implementation of the check on this
Distribution of the Sustainability
engagementâ€? through a structural
campaign carried out internally
Report extract with USB pen and
analysis of all the communication
and externally, including through
offering the possibility of download
activities and dialogue carried out
from the Group site
by the Group
partnership with WWF
All Group publications (included
Production in all the languages
those devoted to sustainability)
used in the Group of the Summary
can be downloaded from our web
of the Sustainability Report and
international Year of the Forest
Adhesion to the Fondazione Sodalitas
and the Year of Volunteering
and the United Nations Global Compact Sustainability inserted in the main menu of the Group website as part of the redefinition of the new site As part of the partnership with the WWF the introduction of product packaging, brand segment, ecoadvice and the Climate Generation information campaign Compilation
Roll out and implementation
management of the supply chain
Relief Fund and Nursery Project
for equal opportunities and work
Nursery project: first draft of
Agreement between the Sofidel Group and the Municipality of Porcari drawn up 122
Implementation of the nursery project
Environment What we said we would do in 2010
What we did in 2010
What we will do in 2011
In 2010, while dealing with an
Increase in the percentage of
certification to other plants in the
increase in productivity of about
certified paper mills or integrated
Group (certification of all the paper
30%, Sofidel has kept constant the
mills by 2012)
percentage of certified plants
Reduction in CO2 emissions as
Construction of a thermal energy
Assessment del Carbon Footprint
required by the Climate Savers
station using turbogas at Delitissue
of the paper produced by (Sofidel
(PL): reduction in climate altering
emissions estimated at 15900 tons/ year Consolidation of the performance
Maintenance of performance
on water consumption and giving
Check the performance of the new plants and create new targets
priority to less valuable sources of supply Optimize the transport of goods on
Transport of 3.19% of the volume
vehicle with lower environmental
of goods on less polluting vehicles
compared to a target of 3.02%
Maintenance of current standards
Customers What we said we would do in 2010
What we did in 2010
What we will do in 2011
Obtain BRC certification in at least
BRC was obtained at the Intertissue
Obtaining certification in the 4
two plants by 2010 and start on
(UK) site and the first steps towards
plants which have started work on
the route to certification in other
certification have been taken in
plants to bring us even closer to
Delitissue (PL), Delipapier GmbH,
fully meeting customer and market
THP and Omega (GER)
management has been completed in
companies and in Sofidel Kagit of
all the Group companies
the active model of the Group
Improve procedures for managing
The European conferences will be repeated (second round) and the theme of sustainability will once again play a central role 123
Develop consultation and debate on
European conferences were held for
In addition, a European focus
sustainability for the key accounts
each channel during which all the
(at least 5% per year)
arguments relating to sustainability
analyse in greater detail subjects
were dealt with in depth, both
addressed during the conference
through training carried out by
and considered to be strategically
important: sustainability, category
corporate CSR, and through direct
management and the supply chain
comparison of the experiences of the sales force Details inserted for each mark/ country based on the state of progress of the project to unify the packaging of our own brand products
Suppliers What we will do in 2011
What we said we would do in 2010
What we did in 2010
Strengthen the qualification of
suppliers of virgin fibre by inserting
questionnaire of aspects relating to
an appropriate evaluation of the
human rights, working conditions,
economic, social and environmental
health and safety, CSR and anti-
dimensions of the services or goods
supplied Drawing up of â€?Specific guidelines
Implementation of the check on
for suppliersâ€? to communicate the
compliance with the Guidelines by
selection process used by Sofidel in
the Groupâ€™s suppliers.
relation to the undertakings, results
Analysis of the data derived from
and improvements expected from its
Id. • • • • •
º • • º • – º • •
Modalità di gestione
ENVIRONMENTAL PERFORMANCE INDICATORS
Modalità di gestione
FINANCIAL PERFORMANCE INDICATORS
GRI TABLE OF CONTENTS
• • • •
EN19-core EN20-core EN21-core EN22-core
• • º
EN27-core EN28-core EN29-add EN30-add
Modalità di gestione
SOCIAL PERFORMANCE INDICATORS
• • • • • •
SO7-add SO8-core PR1-core PR2-add PR3-core PR4-add
Indicator not applicable to Group activities
Glossary AOX (Absorbable Organic Halogens) Shows the concentration of organic chloride compounds in a water sample Biodiversity Variety of living forms in an environment, as a result of the evolution process, guarantee of stability and index of the ecological value of an environment BOD (Biological Oxygen Demand) Shows the quantity of oxygen consumed by biological degradation of the organic composts in the water BRC (British Retail Consortium) The BRC standard is based on an assessment of risk for the consumer, based on the HACCP (Hazard Analysis Critical Control Point) methodology which is used to evaluate the risks connected to the various activities and to set up a self checking system which removes or reduces them to acceptable values Cogeneration Combined production of energy and steam using thermal engines (turbines or others) EMAS (EcoManagement and Audit Scheme) Voluntary tool for assessing and improving the environmental performance of an organization, revised in accordance with EC Regulation no. 761/2001 in effect in the European Community. EMISSION FACTORS and OXIDATION FACTORS The coefficients used to correlate CO2 emissions with fuel consumption or electricity consumption using the ratio: CO2 emissions (tCO2) = fuel or electricity consumption (in t or TJ or MWh) x emission factor (in CO2/t or TJ or MWh) x oxidation factor. For fuels, Sofidel has used the following emission factors: natural gas: 55.91 tonnes CO2/TJ Diesel : 3,173 ton CO2/t LPG: 3.024 tonnes CO2/t and the following oxidation factors: natural gas: 0.995 diesel: 0.99 LPG: 0.99 These factors correspond to the coefficients for the inventory of CO2 emissions in the national UNFCCC inventory (average values for the years 2005-2007). For electricity the specific emission factors defined for each country were used (Source: IEA). ISO 9001 International standard which contains the requirements for developing a quality management system. ISO 14001 International standard which describes the requirements for an environmental management system to be applied in an organization 126
MST (Total Suspended Solids) Expresses the level of transparency of the water, altered by the presence of suspended material of various types released during the various stages of manufacturing, as well as following the waste water treatment process NOx (Nitrogen Oxide) Gaseous compounds of oxygen and nitrogen in various stages of oxidation, derived from the combustion process Together with volatile organic substances this is responsible for the formation of ozone at low heights OHSAS 18001 â€“ Occupational Health & Safety Assessment Series Reference standard, recognized at an international level, for the certification of a workplace health and safety management system SA8000 International certification standards which relates to: respect for human rights, respect for employee rights, protection of minors from exploitation, guarantees of safety and healthiness of the workplace
The SOFIDEL Group Sustainability Report is available on the internet site www.sofidel.it
To make a comment or request further information about the report it is possible to contact the project manager at the address email@example.com
Our thanks to the Reporting Team for collecting the data: Lorenzo Azzi (Identity Group & Communication Manager), Silvio Campanile (Corporate environmental coordination officer), Irene Caponi (Safety management system manager), Filippo Fontanini (Quality technical specialist), Stefano Frediani (Marketing & sales controller), Michela Giuntoli (Assistant Quality System Director), Riccardo Lena (Purchasing manager), Stefano Lippi ( Controlling department manager), Barbara Pieroni (Technical, organizational health & safety manager), Cristian Quartaroli (Customer services coordination manager), Giacomo Tambellini (Corporate finance controller assistant), Arianna Vita (Corporate social responsibility manager)
Graphical Project: BACHI FASCETTI ASSOCIATI Print: San Marco Litotipo - Lucca
Printing of this document was completed in may 2011 Printed on Fedrigoni Freelife certified FSC and Ecolabel Sofidel S.p.A. via di Lucia - Porcari (Lucca) Italy - tel. +39 0583 2681 This document is the property of Sofidel Group which reserves all rights over it. Reproduction, including partial reproduction, is not permitted without prior written authorization. 128