Signatory Name: Visy Industries Australia Pty Ltd

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1 Signatory Name: Visy Industries Australia Pty Ltd The question numbers in this report refer to the numbers in the report template. t all questions are displayed in this report. Status: Complete The content in this APC Annual Report is hereby endorsed by the Chief Executive Officer, or equivalent officer of the organisation Industry sector (please select 1 only): Brand Owner / Wholesaler / Retailer Packaging Manufacturer Waste Management Other - Commercial Organisation Community Group Industry Association Government Raw Material Supplier Other: Please indicate your organisation's reporting period: Financial Year: 1 July June 2016 Calendar Year: 1 January December 2016

2 Goal 1: Design KPI 1: % of signatories with documented policies and procedures for evaluating and procuring packaging using the SPGs or equivalent. 9. Does your company have documented policies and procedures for evaluating and procuring packaging using the SPGs or equivalent? 10. Of the types of packaging existing at the beginning of the reporting period, what percentage had been reviewed using the Sustainable Packaging Guidelines (SPG) by the end of the reporting period? 1 Have any new types of packaging been introduced during the reporting period? 1 Provide details of policies and procedures Visy Pulp & Paper Fibre Procurement Statement Visy Environmental Policy 100 % If yes, of the new types of packaging introduced during the reporting period, what percentage have been reviewed using the Sustainable Packaging Guidelines (SPG) by the end of the reporting 100 % 13. Please indicate your progress this year towards achieving your annual targets and milestones for KPI 1 Action: Educate all staff involved in the design & development of new packaging of the associated environmental and social impacts. Target: Relevant staff able to identify associated impacts Action: Develop formal process for working with customers to address environmental performance of new products Target: Formal process developed Ongoing. Visy packaging is designed in accordance with specifications requested by or agreed with the customer. Being both a resource recovery company and packaging manufacturer, Visy's packaging formats are designed to maximise the recovery potential of the kerbside recycling system and we work with our customers to produce packaging which avoids material incompatibility issues. Understanding these environmental and social impacts is part of the on the job training of design & development staff. Market category forums and new product development teams regularly meet to discuss & review packaging formats with a view to limit environmental & social impacts. Ongoing. Through the Visy Insights & Innovation team, Visy is working across a number of projects with customers to investigate new technologies or materials to improve the environmental performance of packaging. A formal process for these partnerships is yet to be developed and is usually considered on a case by case basis.

3 3. Action: Use internal forums (both digital & face-to-face) to allow designers to share sustainability information Target: Designers sharing knowledge across divisions Ongoing. Internal newsletters covering ideas, product updates, R&D developments etc aid in the development of knowledge transfer. Google+ Category Groups have aided cross-divisional interaction which has allowed open discussion on a market category level. This has allowed designers, sales reps, account managers, R&D specialists etc an open forum both interactively via online discussion and face-to-face. 14. Describe any constraints or opportunities that affected performance under this KPI Visy packaging is designed in accordance with specifications requested by or agreed with the customer. Being a resource recovery company as well as a packaging manufacturer, Visy's packaging formats are designed to maximise the recovery potential through commercial and kerbside recycling systems and we work with our customers to produce packaging that avoids incompatibility issues. Understanding these environmental and social impacts is part of the on the job training of design and development staff. Goal 2: Recycling KPI 3: % signatories applying on-site recovery systems for used packaging. 15. Do you have on-site recovery systems for recycling used packaging? at all facilities/ sites at some, but not all facilities/ sites 16. Please indicate your progress this year towards achieving your annual targets and milestones for KPI 3 Action: Continue to improve on-site recovery systems for recycling at Visy of used packaging and office products Target: Minimum standard met at all sites Action: Continue to improve on-site recovery systems for recycling production wastes Target: Recycling of key material wastes at Visy All of Visy's packaging operations have on-site recovery systems for the collection of waste packaging materials such as trimmings and rejects during manufacture. Visy continues to implement a number of projects and initiatives that reduce waste to landfill and recycling existing production waste. Stormwater management and litter control is included in the company HSE induction completed by all staff every two years and all contractors annually. All shifts at all sites must complete one tool box talk on this topic each year as one of 20 mandatory toolbox topics under the HSE system.

4 3. Action: Improve consumer and customer recycling knowledge Target: Defined education strategy revised to account for key packaging customers Visy works closely with schools and community groups to help educate them on the importance of recycling, waste diversion and general household recycling either through specific council requirements through our education centres or indirectly through specific funding. In the reporting period Visy Recycling completed 91 sessions in Victoria and reached 2,732 people. Visy remains committed to targeted Education and Marketing Programs. We believe developments in e- media and social networks can provide better coverage than traditional methods such as on-site tours, viewing platforms etc identified in current arrangements. 4. Action: Work with key customers to improve away from home recycling Target: Defined strategy to progress public place and other away from home recycling strategies Ongoing discussions with local councils and key customers for strategies to improve public place recycling. 17. Describe any constraints or opportunities that affected performance under this KPI All of Visy's packaging operations have on-site recovery systems for the collection of waste packaging materials such as trimmings and rejects during manufacture. For example: - PET and Plastics rejects and trimmings are collected for regrind and are reused - Paper and cardboard trimmings and waste are recovered and sent to our recycled paper mills for fibre feedstock - Waste aluminium is collected and sent to aluminium processors for recycling as are steel offcuts and trimmings from our food can operations Visy recycled board grades are made of Visy recycled paper lines. Visy's recycled paper mills are FSC Recycled certified. As a result, Visy's corrugated cardboard products offer an excellent environmental impact solution. Visy established Australia's first 100% recycled plastics plant which uses FDA approved recycling processes for the manufacture of recycled food grade PET and the manufacture of recycled HDPE.

5 KPI 4: Signatories implement formal policy of buying products made from recycled packaging. 18. Does your company have a formal policy of buying products made from recycled packaging? Please explain why not Managing the impact of our supply chain is identified in Visy's Corporate Environmental Policy. Visy does not have a prescribed policy for Buy Recycled, however through the supplier quantification review process and through formal supplier reviews, Visy reviews its critical suppliers on it's sustainability focus and regularly receives sustainability updates. As a resource recovery company, Visy has processed over 2 million tonnes of resources from Australian and New Zealand kerbside and commercial recycling in 2015/16. This includes 5 million tonnes of waste paper and cardboard used as a major feedstock for our six recycled paper mills. 19. Is this policy actively used? 20. Please indicate your progress this year towards achieving your annual targets and milestones for KPI 4 targets in Action Plan. N/A 2 Describe any constraints or opportunities that affected performance under this KPI Visy's programs aims to maximise packaging recyclability and increase the recycled content of our products. At the time of writing this annual report, no formal Buy Recycled policy is planned for implementation. Visy supports the APC's target for brand owners to continually review their packaging (both new and current) and supplies information & data that supports the reporting of recycled content in brand owners packaging. Visy collects PET beverage containers through our national recycling network. In we recycled approximately 22,000 tonnes back into bottle production through our PET recycling and PET preform production facilities. Approximately 1,769,486 tonnes of paper & cardboard were also collected via the national recycling network. This paper & cardboard waste then forms part of our recycled paper manufacturing process of which 805,405 tonnes of recycled paper was manufactured in the reporting period. Visy plays a major role in making recycled purchases available to the wider industry - this is our core strength and forms the basis of our closed loop system.

6 Goal 3: Product Stewardship KPI 6: % signatories with formal processes to work collaboratively on packaging design and / or recycling. 2 Does your company have formal processes in place for collaborating with other companies or organisations on improved packaging designs and/or recycling which aims to reduce or eliminate waste? Provide details of policies and procedures (including names of policies/ procedures) Visy has an embedded innovation process with its customers. The Insights & Innovation group is charged with developing new products & processes with internal business units and customers. A good example of this supplier/customer innovation collaboration is the increased use of recycled PET in PET bottles. Visy is also developing applications for rhdpe packaging products for a variety of applications including milk, cream, vinegar & juice up to 50% recycled content. rplastics branding & marketing gives brand owners a competitive advantage - the opportunity to tell a much better packaging sustainability story to their customers. 23. Please indicate your progress this year towards achieving your annual targets and milestones for KPI 6 Action: Continue to identify product certification opportunities Target: All opportunities evaluated Action: Educate staff on key strategies to minimise waste Target: Develop and run "Waste t" program Completed. The appropriate certification opportunities were identified and pursued. All of Visy's recycled paper mills are chain of custody certified to FSC (FSC-C008345) Visy Pulp and Paper Tumut which produces Kraft paper is PEFC Certified and FSC (FSC-C116532). Further certification opportunities will be investigated as they arise. Completed. Educational programs are ongoing. Stormwater management and litter control is included in the company HSE induction completed by all staff every two years and all contractors annually. All shifts at all sites must complete one tool box talk on this topic each year as one of 20 mandatory toolbox topics under the HSE system. 24. Describe any constraints or opportunities that affected performance under this KPI Within our packaging divisions, Visy regularly works with customers to improve the design and/or recyclability of our packaging products. While no formal process is in place, it is an inherent part of our customer relationships and is approached in most contracts and supply agreements. Visy's Recycling division relies on appropriated material collection or sorting. Contamination of non-recyclable materials decreases the efficiency of our Materials Recycling Facilities (MRF's). As such, Visy's packaging formats are designed to maximise the recovery potential of the commercial and kerbside recycling system and we work with our customers to produce packaging which avoids material incompatibility issues. Understanding these environmental and social impacts is part of the on the job training of design and product development staff. Visy also works closely with major customers in providing innovative product designs that utilise emerging technologies in materials, design and sustainabie packaging. The feasibility of such products always considers the recyclability and recoverability of a material and design through our existing recycling infrastructure. Visy are ensuring that our customers are at the forefront of the latest packaging technology and innovations by holding a range of trade shows around Australia. The Visy Advantage Innovation Trade shows have been attended by over 350+ customers and are an invaluable way of showcasing Visy's broader capability.

7 KPI 7: % signatories showing other Product Stewardship outcomes. 25. Please indicate your progress this year towards achieving your annual targets and milestones for KPI 7 Action: Use internal forums (digital) to inform customer facing staff of product stewardship issues Target: Increase usage and access to forums Action: Explore opportunities for resource efficiency across the Visy Group Target: Resource efficiency procedures implemented Ongoing & evolving. This program has successfully developed into open market category discussions using a mixture of Google+ communities as well as formal market category forums where product stewardship issues are amongst standard discussion items. Cross divisional in nature, the forums provide an opportunity to enhance specific learnings in this area and to apply such learnings to business oriented outcomes. Projects formed out of these groups are aligned to Visy and specific customer goals. Resource efficiency is the backbone of Visy operations. The Visy Environment Policy contains a commitment to use natural resources responsibly. Visy is committed to reducing the energy used and the carbon footprint of its manufacturing operations. Visy continues to monitor and review energy consumption across its sites. Visy has consistently increased the amount of energy from renewable sources (including wood waste, black liquor from kraft paper production, biomass-paper waste, and bio-gas and bio-fuels derived from production processes) over the past five years. In Visy produced approx. 50% of its energy needs from renewable sources. Since Visy has reduced its greenhouse gas emissions per energy consumed by 23.5%. In Visy generated 982,780 GJ of electricity within its operations (a 3.5% increase on FY15) and through this reduced our use of electricity from the national grid.

8 26. Since the beginning of the reporting period, has your company had any other outcomes related to product stewardship? If yes, please give examples of other product stewardship outcomes 27. Describe any constraints or opportunities that affected performance under this KPI Visy's Environment Policy contains a commitment to use natural resources responsibly. Visy's major water use is from its eight paper mills operating in three states. Visy continues to monitor and review water consumption across its sites. Visy uses a number of alternative water source's (i.e desalination and also recycled water) These alternative water sources have increased from KL (3.7% of total water consumption) in FY09 to 164,721 KL (16.5% of total water consumption) in FY16. This has reduced our impact on fresh water sources/ Visy is committed to reducing the energy used and the carbon footprint of its manufacturing operations. Visy continues to monitor and review energy consumption across its sites. Visy has consistently increased the amount of energy from renewable sources (including wood waste, black liquor from kraft paper production, biomass-paper waste, and bio-gas and bio-fuels derived from production processes) over the past 7 years. In Visy produced approx. 50% of its energy needs from renewable sources. Since Visy has reduced its greenhouse gas emissions per energy consumed by 23.5%. In Visy generated 982,780 GJ of electricity within its operations (a 3.5% increase onfy15) and through this reduced our use of electricity from the national grid. KPI 8: Reductions in packaging items in the litter stream. 28. Please indicate your progress this year towards achieving your annual targets and milestones for KPI 8 Action: Improve broader staff awareness of the strategies to reduce the incidence of Visy's packaging becoming litter Target: Run internal litter educational program Action: Ensure litter management is adequately addressed in housekeeping checklists Target: Adequate litter management on site Ongoing. Visy-wide Toolbox Talks on Litter and Stormwater management mandated across all sites. Stormwater management and litter control is included in the company HSE induction completed by all staff every two years and all contractors annually. All shifts at all sites must complete one tool box took on this topic each year as one of 20 mandatory toolbox topics under the HSE system. Ongoing. Visy-wide Toolbox Talks on Litter and Stormwater management mandated across all sites. Stormwater management and litter control is included in the company HSE induction completed by all staff every two years and all contractors annually. All shifts at all sites must complete one tool box took on this topic each year as one of 20 mandatory toolbox topics under the HSE system. 29. Describe any constraints or opportunities that affected performance under this KPI Visy works with customers to design packaging formats which minimise littering by avoiding unnecessary removable items. However the nature of away from home consumption requires packaging systems to often contain removable pieces such as foldable forks or spoons, and ultimately littering is a personal decision. Effective away from home recycling systems and community education have been shown to reduce littering and Visy has supported the promotion of these goals through our involvement with local councils.

9 Your Experiences This section lets you share with us any achievements, good news stories and areas of difficulties in making progress against your plan and the Covenant goals and KPIs. 30. Key achievements or good news stories In Visy has processed over two million tonnes of resources from Australian and New Zealand kerbside and commercial recycling. This includes 7 million tonnes of waste paper and cardboard used as a major feedstock for our six recycled paper mills. Visy's programs aim to maximise packaging recyclability and increase the recycled content of our products. Visy's Council and Commercial co-mingled collection services recover mainly PET, HDPE, Aluminium, Steel, Glass and Fibre. Recyclable waste materials from Fibre and PET businesses are put back through the recycling/manufacture process and eventually reused in new packaging products. 3 Areas of difficulties in making progress against your plan, Covenant goals or KPIs We firmly believe that Visy's core business principles strongly support the goals of the Covenant however we realise that many of the Actions in our Plan required the implementation of separate business processes above these already effective systems. Visy's approach to the goals of the Covenant should instead be through the delivery of mainstream strategies that build on our existing culture of lowest cost that continue to drive sustainability through commercial initiatives. Visy has strongly supported the Australian Packaging Covenant and supports a broad whole of lifecycle approach to sustainable packaging, not solely recovery focused policy. We also continue to support great domestic remanufacturing of products from recyclates, to deliver national benefits including manufacturing jobs and investment as well as emissions reduction. A cultivation of innovation and our unique service model through the life-cycle of packaging has made Visy a leader in its field. We can help our customers design innovative new packaging, create it, assist with manufacture, transport product to customers or end consumers, provide expert branding and promotions, then...collect it all back again to be recycled into new packaging. Our APC Action Plan and thus this Annual Report only apply to Visy's Packaging operations in Australia only, Visy Pulp and Paper, Visy Recycling, Visy Logistics and our offshore operations fall outside the scope of the APC. However Visy Recycling is core to Visy's approach to resource recovery and is included within the Plan to Recycling Key Performance Indicators. Visy realises that our APC Action Plan as it currently stands is what we intended to do at the time that it was submitted - the majority of KPIs have already been achieved. However the reality is that Visy works very closely with our customers to help them meet their APC KPI's. It is planned that our Action Plan will be reviewed once the APCO reconfirms its Agenda going forward. Visy is driving sustainable packaging and is a clear leader in the field but we also recognise that the agenda is set by our customers.