E5 – Resource use and circular economy
METSÄ BOARD Annual review 2024
Impact metrics related to changes in biodiversity and ecosystems
Reporting principles for metrics The calculation of high biodiversity stumps left on harvesting sites covers the direct standing sales carried out by Metsä Group’s Wood Supply and Forest Services. The harvesting sites include intermediate and regeneration felling sites. The calculation of retention trees left on regeneration felling sites covers the direct standing sales carried out. Forest certification criteria set minimum requirements for the number of retention trees. The calculation is based on the number of regeneration felling sites. Stands containing only spruce after young stand management include the young stand management work carried out. The calculation takes spruce-dominated sites into account where spruce amounts to more than 50% of the remaining trees. Spruce is considered to be the only tree species if other species account for less than 10% on the site. The number of measures promoting biodiversity is calculated based on the measures carried out in owner-members’ forests. The measures that are currently monitored include nature management measures in herb-rich forests, burned retention trees, Metsä Group’s nature site service and the number of Metsä Group Plus agreements. Metsä Group develops metrics for the state of forest nature, their reliability and a harmonised monitoring system. The development of metrics is described in more detail under Actions . The metrics have not been validated by an external party.
Material impacts, risks and opportunities related to resource use and the circular economy
The 2030 targets providing a measure of the actions are described in the table Metsä Group’s 2030 sustainability targets for wood supply . Emissions to air and water discharges are discussed under E2 – Pollution . Metrics of the state of forest nature, their reliability and a harmonised monitoring sys- tem are developed as a collaborative industry effort and to achieve Metsä Group’s own targets. Further information can be found under Actions . Financial effects The risks related to biodiversity and ecosystems are presented in the table on pages 58–59. As Metsä Group does not own forest important for its wood supply, the risks related to biodiversity and ecosystems do not affect its assets. If the risks were to be realised, they would affect Metsä Board in the long term through the availability and cost of wood raw material.
Business operations and value creation 2 This is Metsä Board 4 CEO’s review 6
Impacts
Risks and opportunities for Metsä Board
Management
Resource inflows, including resource use
Opportunity: Legislation that recognises the climate and other benefits of fossil-free raw materials in the production of materials and sets requirements for replacing primary fossil-based raw materials with more sustainable alternatives. Opportunity: The full use of the main raw material, renewable wood. Innovations and the development of the production process can increase the added value of wood raw material and diversify the product portfolio. Risk: Legislation that requires the use of recycled material in bio-based products and does not recog- nise the circular economy benefits offered by fresh fibres and other bio-based raw materials. Because the current business strategy focuses on fresh fibre products, this would probably have a negative impact on business. Adapting to a changed operating environment would require new investments, among other things. The impacts, risks and opportunities related to wood-based energy are described under E1 – Climate change . Opportunity: Legislation that favours recyclable products made from renewable resources by the forest industry instead of packaging made from materials such as fossil-based plastic offers growth opportunities. Risk: Legislation that favours reusable packaging instead of recyclable, disposable packaging can reduce the demand for Metsä Board’s products. If the chemical recycling of plastics is implemented at industrial scale, the use of plastics may become more acceptable, and there will be less need to replace plastics. Opportunity: The utilisation of side streams offers economic benefit. Making full use of the forest industry’s side streams strengthens the industry’s acceptability and secures future operations. Risk: If a purpose is not found for all side streams, the appreciation of forest industry operations will weaken, and no economic benefit will be obtained from side streams. Risk: Legislation that leads to a decline in the use of forest industry side streams for bioenergy generation erodes the appreciation of forest industry operations.
Thanks to regenerative forestry, the primary renewable resources used by Metsä Board can be obtained in accordance with circular economy principles. They are a more sus- tainable alternative to fossil-based primary raw materials, which cannot be obtained in compliance with the circular economy. The impact of wood raw material on the carbon balance of forests and forest biodiversity, as well as the related risks and opportunities, are presented under E1 – Climate change and E4 – Biodiversity and ecosystems . The impacts, risks and opportu- nities of water and energy consumption are described under E1 – Climate change and E3 – Water and marine resources .
• Wood raw material is utilised entirely. • As part of Metsä Group, Metsä Board develops industrial symbi- oses with other business areas creating resource use synergies. • R&D for using side streams to develop fossil-free alternatives and make products more lightweight. • The continuous improvement of production processes and new mill investments further improve resource efficiency. • Commitment to regenerative forestry principles, the continuous development of forest management services and other active cooperation with the cooperative’s owner-members. The actions are described in greater detail under E1 – Climate change and E4 – Biodiversity and ecosystems . • Attention is also paid to the resource efficiency of other materials and their energy use. Actions to reduce water use are described in greater detail under E3 – Water and marine resourc- es , and actions to improve energy efficiency are described under E1 – Climate change .
Strategy and financial targets
8
Value creation
Financial development 10 Key figures 12
Report of the Board of Directors
20 20 37 70 89 96
• Sustainability statement
General information
E – Environment
The impacts, risks and opportunities related to wood-based energy are described under E1 – Climate change .
• The management of impacts, risks and opportunities related to wood-based energy are discussed under E1 – Climate change .
S – Social responsibility
G – Governance
Resource outflows related to products and services Metsä Board’s products offer customers and consumers the opportunity to use recyclable
Annexes to the Sustainability statement
• R&D and services increase the recyclability of products and reduce their environmental footprint. • Cooperation with customers and other value-chain operators is active. • Active engagement in social dialogue. Metsä Board’s influencing and lobbying are discussed under G1 – Business conduct .
products and an alternative to products made from fossil-based raw materials.
98 Consolidated financial statements 102 Notes to the consolidated financial statements 150 Parent company financial statements 153 Notes to the parent company financial statements 166 The Board’s proposal to the Annual General Meeting for the distribution of funds 167 Auditor’s Report 171 Sustainability statement assurance report 173 Shares and shareholders 177 Ten years in figures 178 Taxes 179 Production capacities 181 Calculation of key ratios and comparable performance measures Corporate governance 183 Corporate governance statement 190 • Board of Directors of Metsä Board 194 • Corporate Management Team of Metsä Board
Impacts
Metsä Board’s production side streams are converted into new products
• In cooperation with Metsä Group’s other business areas, Metsä Board aims to make full use of wood raw material. • New applications are jointly sought for production side streams with partners. New wood construction solutions are developed jointly with customers. • As part of Metsä Group, Metsä Board develops industrial symbi- oses with other business areas creating resource use synergies. • Metsä Board invests in cleaner process technology. • Metsä Group optimises the use of wood-based side streams as material and energy. The long-term goal is to increase the use of side streams as material, and one of the five strategic R&D programmes aims to develop new commercialised products from industrial side streams. • Metsä Group has also invested in four growth companies that develop new products from side streams currently utilised as energy. Currently, the utilisation of wood-based side streams as energy plays an important role in long-term plans and in securing the availability of bioenergy.
Metsä Board’s production currently gener- ates small amounts of landfill waste, causing emissions to air, water and soil. Nearly all production side streams are utilised as materials or energy. Landfill waste in the reporting year is presented in the table on Waste use and disposal. The 2030 target is 0 tonnes of process waste delivered to landfills
Positive impact on the environment and society or on Metsä Board’s business Negative impact on the environment and society or on Metsä Board’s business
Metsä Board’s 2030 sustainability target
2030 target
2024
2023
2022
Process waste delivered to landfills, t
0
267
1,164
130
196 Remuneration report 201 Investor relations and investor information
64
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Report of the Board of Directors | METSÄ BOARD ANNUAL REVIEW 2024
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