Fibria social case. NGP Summit, Cape Town. June 18, 2014

Transcription

1 Fibria social case NGP Summit, Cape Town June 18, 2014

2 Is there a Fibria social case? Fibria achieved some important results in the relationship with communities in the last 5 years, which became known by some as Fibria Social Case But, there is only a sucessful social case if anchored on broad sustainability fundamentals broad sustainability fundamentals can only be in place if linked to a sound business strategy there is not a finnished case all sustainability cases are cases in progress 2

3 Fibria sustainability case, a case in progress... NGP Summit, Cape Town June 18, 2014

4 Main sustainability achievements in the last 5 years Strengthening of governance Board Sustainability Committee Commitment to long term goals (2025) Sets directions for the future Improvement of the relationship with communities in general Reduction of some historical conflicts in Espírito Santo and Bahia Improvement of the relationship with civil society in general Sharp decline of campaigns against Fibria All Fibria s units became FSC and PEFC certified 4

5 WHO WE ARE WHERE WE ARE Fibria was created in 2009 as a result of the merger between VCP and Aracruz We are a Brazilian company with a strong presence in the global forest products market. Três Lagoas Belmonte Veracel Caravelas Portocel Aracruz Our main product is market pulp. But we also produce timber, and are seeking to diversify to biofuels and biomaterials Port Terminal Pulp Unit Jacareí Santos

6 OUR BELIEFS MISSION VISION VALUES To develop the renewable forest business as a sustainable source of life. To consolidate planted forests as a producer of economic value. To generate admired profit, together with environmental conservation, social inclusion and improvement in the quality of life. Strength Ethics Respect Entrepreneurship Harmony

7 GLOBAL PULP MARKET LEADER Production capacity of the world s largest pulp producers

8 Land use in Fibria s areas Forests in seven states and over 250 municipalities ,5 3, All forests certified both by FSC and PEFC (CERFLOR) Base Date: December, Doesn t includes 50% Veracel ownership. Does not include forest incentive areas. Numbers rounded off. 8

9 MILLS Três Lagoas/MS 1,3 million tonnes/year Total installed capacity: 5.25 million tonnes/year Jacareí/SP 1,1 million tonnes/year Aracruz/ES 2,3 million tonnes/year Veracel Eunápolis/BA million tonnes/year (50%)

10 CONSOLIDATED GLOBAL PRESENCE Results 2013 (by region) 28% North America 39% Europe 24 % Asia 9% Latin America v Source: Fibria Distribution of sales

11 Sustainability Governance Sustainability Committee Board of Directors Executive Officers Sustainability and Corporate Relations Executive Officer Sustainability Internal Commission Corporate Level Local Stakeholders Relations Group Operational Units 11

12 Long-term Targets 2025 Reduce by one third the amount of land required for the production of pulp 2011: 10 t pulp/ ha/ year 2025: 15 t pulp/ha/year Double the carbon absorption from the atmosphere 2011 : 5.5 million tco2eq /year 2025 : 11.1 million tco2eq /year Promote the environmental restoration in 40 thousand hectares of own land, between 2012 and 2025 Total rehabilitation in the period

13 Long-term Targets 2025 Reduce by 91% the amount of industrial solid waste disposed at landfill 2011: 60 kg/adt 2025: 5 kg/adt Achieve 80% of approval rate in opinion polls among neighboring communities % % Provide support for local development projects in neighboring communities in a way that 70% of them become self-sustainable % of self-sustainable projects % of self-sustainable projects

14 Time of conflict with the Indians ( )

15 Time of conflict with the Indians ( ) Land invasion May 2005

16 Time of conflict with the Indians ( ) Mill invasion Oct 2005

17 Time of conflict - with the Indians ( ) Agreement in 2007 put an end to the conflict Indian lands till 2007 = 7,000 ha Demarcated expansion area in 2007 =11,000 ha Total area after 2007 =18,000 ha Fonte: Aracruz Celulose

18 Time of conflict with the Landless Workers Movement (MST) Land invasions

19 Time of conflict with the Landless Workers Movement (MST) Destruction of tree nursery and labs

20 Time of conflict with Quilombola communities

21 Time of conflict with illegal charcoal producers 320,000 m3 stolen in 2010

22 Time of conflict with illegal charcoal producers

23 Time of conflict the business case Main impacts on Fibria License to operate 11,000 ha of company s lands demarcated as Indians lands in ,000 m3 of wood stolen in 2010 Road blocks, which affected transportation of wood and workers to the mill Market share Unability to get certification Some customers were targeted by NGOs campaigns Access to capital Some investors were increasingly concerned about risks Institutional investors were in special targeted by NGOs campaigns Workers motivation Despite strong support to the company s positions, low motivation due to continuous stress Image and reputation Brand associated to excellent technical performance but poor sustainability record 23

24 Time of cooperation, with mutual benefits In 2009 Fibria launched a comprehensive strategy to reduce the conflicts Main results (2014) Agreement with MST for the settlement of 1,000 families; Support program for indigenous communities; Social projects with dozens of rural communities, benefetting 5,000 families Benefits started to appear, Well being for the communities Licence to operate for Fibria (wood theft reduced nearly to zero) FSC certification in Espirito Santo and Bahia Conflicts replaced by cooperation NGOs campaigns significantly reduced Company s reputation markedly improved No free lunch Investments in social programs between amount to US$52 million Not all issues solved some very complex (such as for Quilombolas), but we are doing our best to help to solve them. 24

25 Better understanding of the communities Specialized partners with recognized experience Priority matrix Engagement Operational Dialogue Presence Agenda High and low priority communities (risk assessement) High priority communities All communities where operations are taking place Low priority communities Outcomes of engagement processes Quilombolas and rural communities Landless Workers Indigenous communities Traditional fisheries PDRT Territorial Rural Development Program/ Apiculture Sustainable Settlements Sustainable Territories Small community enteprises

26 Better understanding of the regional and local reality Community Type Total Indigenous 14 Quilombolas 141 Small fishermen 28 Smallholders 161 Rural/ Urban 37 Urban 20 Collectors 2 Others 8 Total 411 Smallholders Quilombola Immigrants Metropolitan

27 Strong and clear relationship and engagement tools Stakeholder relationship model Priority matrix Engagement Operational dialogue Personal presence agenda Define community investment priority and social and environmental investment scale and intensity as well the relationship tool to be applied. Identify local stakeholders demands and build integrated and shared solutions. Action plans with community involvement. High priority communities Define how company s operations will affect the community and establish local agreements. Planned contacts with communities according the operational planning. Define how stakeholders routinely communicate with the company. Regular, planned contacts with low priority communities at longer intervals. Fibria 2013 Relationship plan Engagement 53 communities in 08 municipalities. Operational dialogue 109 communities in 35 municipalities. Personal presence agenda 248 communities in 30 municipalities.

28 Number of participating families State PDRT (Rural Communities) Sustainable Settlements (Landless Workers) Sustainable Territories (Indians) Apiculture Bahia 835 1, Espirito Santo Mato Grosso do Sul São Paulo Total , ,771 families in the main processes > 5,000 famílias in all the processes

29 Evolution in community income Declared income 2012 Bahia Declared income 2013 Bahia 4% 23% 73% Até 1 salário mínimo Up to 1 minimum wage Acima From 1 to de 4 minimum 1 a 4 salários wages mínimos Não informou Not answered 42% 1% 5% 52% Até 1 salário minimo Up to 1 minimum wage Acima From 1 to de 4 minimum 1 a 4 salários wages mínimos Acima de 4 salários Above 4 minimum wages Não informou Not answered Declared income Espírito Santo Declared income Espírito Santo 9% 8% Até 1 salário mínimo Up Up to 1 to minimum 1 minimum wage wage 1% 5% Até 1 salário mínimo Up to 1 minimum wage 83% Acima From 1 to de 4 minimum 1 a 4 salários wages mínimos From 1 to 4 minimum wages Não Not informou answered Not answered 47% 47% Acima From 1 to de 4 minimum 1 a 4 salários mínimos wages Acima de 4 salários Above 4 minimum mínimos wages Não informou Not answered

30 Sustainable Land Settlements (MST) Symbolic start of the Technical Training and Research Center for Agro Forestry a partnership between Fibria, MST (Landless Workers Movement), State and Federal Government and São Paulo University

31 Sustainable Territories (Indians)

32 PDRT Territorial Rural Development Program Voluntary destruction of illegal ovens

33 PDRT Territorial Rural Development Program

34 Favorability Index Total 72.56% BA ES MS SP Economic Legitimacy Interpersonal Trust Sociopolitical Legitimacy Interorganizational Trust Total Range Over 80% Favorability High 61-80% Good 41-60% Medium Up to 40% Low

35 Engagement and partnerships

36 Thank you!