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APP China 2009 Sustainability Report

APP China 2009 Sustainability Report

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Published by Asia Pulp and Paper
APP-China turns the lights off for “Earth Hour” 2011 on March 26
Major factories and operations going beyond Earth Hour across mainland China, Hong Kong, and Taiwan
Shanghai – March 25, 2011 – APP-China will turn off its lights tomorrow, March 26, from 20:30 to 21:30 and will once again become a participant in the amazing global environmental initiative, Earth Hour, of WWF. This year, APP-China will expand its participation from the company’s headquarters and major mainland China factories to its operations across Hong Kong and Taiwan in order to continue its commitment to environmental protection.

2011 is the third consecutive year for APP-China to participate in Earth Hour. To echo the theme of this year’s Earth Hour: “Go Beyond the Hour,” APP-China has not only increased the scope of its participation from major mainland China factories (including Gold East Paper Co., Gold Huasheng Paper Co., Ningbo Zhonghua Paper Co., Ningbo Asia Pulp & Paper Co., Gold Hong Ye Paper Co., Hainan Jinhai Pulp & Paper Co., and Guangxi Jingui Pulp & Paper Co.) and the headquarters of both Taiwan and Hong Kong operations, but the company has also further boosted its commitments to environmental protection through its newest campaign to educate the public about proper paper usage and to lead the paper industry’s efforts to plant more trees under the concept of plantation-pulp-paper integration in order to further improve the sustainability of the paper industry and to make sustainable lifestyles a reality.

“Turning off the lights for an hour may look like a small thing; however, the meaning of such action is significant,” Sophy Huang, PR director of APP-China said. “By participating in Earth Hour across APP-China’s operations in mainland China, Taiwan, and Hong Kong this year, we are hoping to raise environmental awareness on both sides of the Taiwan Strait. This is one big step going beyond our day-to-day efforts of reducing carbon emissions.”

Over the years, APP-China has carried out various activities for environmental protection around China, with initiatives in such areas as energy saving and carbon emission reduction. So far, APP-China has invested 740 million dollars (or 5 billion RMB) in environmental protection altogether. This sizeable investment, additional technology innovation, and advanced management processes helped APP-China become a green pioneer of the Chinese paper industry. The company has also received a great number of awards, like the Low Carbon China Contributing Enterprise (International) award and the 2010 Outstanding China CSR Enterprise award.

“APP is committed to environmental protection and we believe that it is a core part of our business operations,” PR director of APP-China added. “Going forward, we will continue to lead the industry through our ‘Paper Contract with China’ (PCwC) commitment that enters its fourth year in 2011. In the complex socio-economic environment of China, we are committed to development and sustainability, minimizing the environmental impact of our operations and ensuring that the social and economic impact of paper industry in China is resoundingly positive.”


# # #

About APP-China
Registered in Singapore in October 1994, Asia Pulp and Paper (APP) is one of the world’s leading pulp and paper companies and is ranked one of the largest vertically integrated pulp and paper producers in Asia. Since APP started investing in China in the early 1990s, it has over 20 pulp and paper mills in the form of subsidiaries or joint ventures, as well as forest plantations with a total area over 320,000 hectares. With over 37,000 employees, APP-China had a total production capability 7.6 million ton per year in 2009.
In June 2008, APP-China launched the Paper Contract with China, to showcase the company’s sustainable development strategy and its long-term commitments to China. By the end of 2009, APP-China had spent RMB 5 billion in environmental protection facilities and RMB
APP-China turns the lights off for “Earth Hour” 2011 on March 26
Major factories and operations going beyond Earth Hour across mainland China, Hong Kong, and Taiwan
Shanghai – March 25, 2011 – APP-China will turn off its lights tomorrow, March 26, from 20:30 to 21:30 and will once again become a participant in the amazing global environmental initiative, Earth Hour, of WWF. This year, APP-China will expand its participation from the company’s headquarters and major mainland China factories to its operations across Hong Kong and Taiwan in order to continue its commitment to environmental protection.

2011 is the third consecutive year for APP-China to participate in Earth Hour. To echo the theme of this year’s Earth Hour: “Go Beyond the Hour,” APP-China has not only increased the scope of its participation from major mainland China factories (including Gold East Paper Co., Gold Huasheng Paper Co., Ningbo Zhonghua Paper Co., Ningbo Asia Pulp & Paper Co., Gold Hong Ye Paper Co., Hainan Jinhai Pulp & Paper Co., and Guangxi Jingui Pulp & Paper Co.) and the headquarters of both Taiwan and Hong Kong operations, but the company has also further boosted its commitments to environmental protection through its newest campaign to educate the public about proper paper usage and to lead the paper industry’s efforts to plant more trees under the concept of plantation-pulp-paper integration in order to further improve the sustainability of the paper industry and to make sustainable lifestyles a reality.

“Turning off the lights for an hour may look like a small thing; however, the meaning of such action is significant,” Sophy Huang, PR director of APP-China said. “By participating in Earth Hour across APP-China’s operations in mainland China, Taiwan, and Hong Kong this year, we are hoping to raise environmental awareness on both sides of the Taiwan Strait. This is one big step going beyond our day-to-day efforts of reducing carbon emissions.”

Over the years, APP-China has carried out various activities for environmental protection around China, with initiatives in such areas as energy saving and carbon emission reduction. So far, APP-China has invested 740 million dollars (or 5 billion RMB) in environmental protection altogether. This sizeable investment, additional technology innovation, and advanced management processes helped APP-China become a green pioneer of the Chinese paper industry. The company has also received a great number of awards, like the Low Carbon China Contributing Enterprise (International) award and the 2010 Outstanding China CSR Enterprise award.

“APP is committed to environmental protection and we believe that it is a core part of our business operations,” PR director of APP-China added. “Going forward, we will continue to lead the industry through our ‘Paper Contract with China’ (PCwC) commitment that enters its fourth year in 2011. In the complex socio-economic environment of China, we are committed to development and sustainability, minimizing the environmental impact of our operations and ensuring that the social and economic impact of paper industry in China is resoundingly positive.”


# # #

About APP-China
Registered in Singapore in October 1994, Asia Pulp and Paper (APP) is one of the world’s leading pulp and paper companies and is ranked one of the largest vertically integrated pulp and paper producers in Asia. Since APP started investing in China in the early 1990s, it has over 20 pulp and paper mills in the form of subsidiaries or joint ventures, as well as forest plantations with a total area over 320,000 hectares. With over 37,000 employees, APP-China had a total production capability 7.6 million ton per year in 2009.
In June 2008, APP-China launched the Paper Contract with China, to showcase the company’s sustainable development strategy and its long-term commitments to China. By the end of 2009, APP-China had spent RMB 5 billion in environmental protection facilities and RMB

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Published by: Asia Pulp and Paper on Mar 25, 2011
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02
2009 was an extraordinary year. The global economies suffered a periodof stagnation, following the global financial crisis. Industries spanning allmarket areas were greatly hurt by the challenging global economy and hadhuge financial hurdles to overcome. The paper industry in China was notimmune. However, thanks to APP-China’s six corporate strengths
:
cutting-edge technologies, integrated supply chain, in-house R&D focused onhigh-tech product development, a global sales network, an environment-oriented management philosophy, and a unique management system. APP-
China managed to overcome the nancial obstacles and thrive on the harsh
economic climate and grow even stronger. APP-China’s ability to mitigaterisks and grow stronger in challenging times was evident in its performanceduring 2009. As a result, APP-China became the top choice for customers andmarkets based on its quality products and services.Since it was founded, APP-China has gone through three major developmentstages to become bigger, stronger and more sustainable. The first stagewas the strategic expansion of plantations and manufacturing facilities.Since entering China in the early 1990s, APP-China has established forestplantations in the Guangdong Province, Guangxi Zhuang AutonomousRegion, Hainan Province, Henan Province, Yunnan Province, and other provinces. APP-China has also established four major pulp and paper mills,including Gold East Paper (Jiangsu), Ningbo Zhonghua Paper, Gold HongyePaper (Suzhou Industrial Park), and Gold Huasheng Paper (Suzhou IndustrialPark). Total production capacity for these mills amounted to 2.4 million tonsand total asset value of 20 billion RMB. The second stage was to build arobust, vertically integrated business. APP-China completed a "Plantation-Pulp-Paper" integration with the establishment of Hainan Jinhai Pulp & Paper.The completion of Gold East Paper Phase III and Ningbo Phase II expansionprojects further expanded the company’s portfolio and brought APP-China’s total production capacity to 5 million tons and raised total asset value to 50billion RMB. The third stage was to create product-and-service mix to meetmarket demands with long-term sustainable development. Hainan JinhaiPulp & Paper invested in world-class, state-of-the-art technologies to further upgrade its pulp production capacity and increase its product offerings.Meanwhile, APP-China continues to widen its spectrum of products andservices. APP-China’s total production capacity is expected to reach 8 milliontons (comprises of 6 million tons of paper and 2 million tons of pulp mills), andtotal asset value is predicted to reach 80 billion RMB.During its development, APP-China faced the challenges of both the 1997
Asian nancial crisis and the 2008 global nancial crisis. In 1997, APP-China
was deeply affected by the economic downturn and its recovery was slowand painful. However, as management learned greatly from that previousexperience, APP-China was able to mitigate and control its exposure and the
problems that arose from the 2008 global nancial crisis quickly. In 2009, APP-
China focused on increasing revenues, reducing expenditures, and enhancingexecution. As for management strategy, APP-China reduced production costsand increased productivity with performance-driven initiatives. Furthermore,where possible, APP-China strived to adjust, stabilize, enhance, and developits overall operations to deliver the best paper and pulp quality and services.
Message fromthe Chairman
In 2009, APP-China had more than 37,000 employees, achieved more than34.5 billion RMB in sales revenues and contributed approximately 1.6 billionRMB in total taxes paid. Having weathered the storms of 2009, APP-Chinawill continue to optimize human capital by attracting, developing, and retainingtalent, and prepare for its medium and long-term growth and development.In June 2008, APP-China achieved a corporate milestone to accelerate
sustainable development, by publishing its rst “Paper Contract with China
(PCwC) 2008.” The manifesto declared the company’s commitment tobecome a dedicated advocate for and partner in China's green paper industry.One year later, the PCwC 2009 manifesto was updated with modifiedsustainable objectives and targets. We did this to further demonstrate APP-
China’s unwavering determination and continuous effort in time of difculty,
to foster sustainable plantation development, promote clean production, andbolster corporate social responsibility.
Moving forward, APP-China will seize opportunities in three key areas. The rst
area will be in Industry Development. Through this report, we hope to providethe general public with a clearer understanding of China’s paper industry in anattempt to neutralize the outdated stereotypes and perceptions of the paper-making industry. We would like to relay to stakeholders and the public that thepaper-making business can be transformed into a green industry and promotea stable economy with responsible management and sustainable practices.APP-China will aim to become the industry role model in low-carbon emissionsand clean paper and pulp production. Ultimately we will lead the Chinesepaper industry on a journey towards sustainability. The second area will be inMarket Demand. The demand for paper will grow in pace with living standards.Based on China’s development trends, we anticipate a large growth potentialfor industrial and household products. APP-China plans to develop more high-quality product offerings to anticipate market demand, and at the same time,continue to contribute to economic development through increased job creationand tax contribution. The third area will be in Global Leadership. With less thantwo decades of business development, APP-China still has a long way to goto be the world’s No. 1 paper and pulp company. Nevertheless, APP-Chinawill strive to become the industry leader in scale, quality, management and
protability. As a Chinese company, APP-China takes pride in its achievements
in the global paper industry and in its endeavors in promoting one of the four great ancient Chinese inventions.
APP-China’s steady growth over the past 17 years has reected the company’s
realization of its sustainable development strategies. APP-China believes thatsustainable plantation development, clean production, and corporate socialresponsibility are the driving forces to further the development of the paper industry. We look forward to building a green economy and a clean paper industry and, above all, upholding our green commitment with the full supportof our management, employees and stakeholders.
Teguh Ganda WijayaChairman & CEOSinar Mas and APP-China

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