Huhtamaki Australia Australian Packaging Covenant Action Plan 2011 2012 31 March 2011
Company: Huhtamaki Australia Food Service Business Unit Contact: Rebecca Ng, Nat Acct Mgr Huhtamaki About Huhtamaki: Huhtamaki is a global leader in manufacturing specialty food packaging and food service products. Australia Pty Ltd is a subsidiary of the publicly listed Huhtamaki Oyi, which is headquartered in Espoo, Finland. The Australian Subsidiary is segmented into different business units and generates its revenue predominantly from locally manufactured products from the Windsor (Foodservice) and Preston (Moulded Fibre). The action plans covers the Foodservice and Moulded Fibre business units. Huhtamaki and Sustainability: Huhtamaki globally endorses the principles of the International Chamber of Commerce (ICC) Sustainability Charter, which is reflected in our environmental policy. Huhtamaki continuously aim to improve the environmental performance through action programmes focusing on minimising natural resource depletion, optimising process efficiency, applying the best available techniques and practices, and reducing solid waste generation, effluent discharges and emissions to air. For more information: www.huhtamaki.com Page 2
Foodservice Business Unit Action plan Page 3
Food service Product/Packaging: Foodservice Business Unit Huhtamaki Australia is classified as a packaging supplier manufacturing and supplying via third party suppliers a range of food packaging products paper and plastic. Huhtamaki manufactures its packaging productsd from different raw materials and combination of materials, and uses raw materials from both renewable and non-renewable resources. The products service a wide range of customer, under their own brands as well Huhtamaki s brands such as Huhtamaki, Chinet, Bioware and Lily. Huhtamaki s Packaging is grouped via the following criteria: Locally manufactured products Traded Products imported from overseas Huhtamaki sites and 3 rd party manufacturing Local Manufacturing Location: Primarily manufactures paper cups and plastic lids for customer owned brands and retail brands. Huhtamaki is committed to comply with the principles of sustainable development, which is reflected in our raw material procurement policies, and continuous improvement on product manufacturing and supply chain. Traded products Huhtamaki sources a range of food packaging products such as plates and cutlery from other overseas Huhtamaki sites and 3 rd party manufacturing sources. Page 4
Huhtamaki Food Service Business Unit APC Team: Name Position Involvement Brad Kerle General Manager, Food Service Strategy Simon Rowe Plant Manager, Windsor Sustainability Officer Maike Milobara Sales and Marketing Manager Sales and Marketing Jano Crema Production Manager, Windsor Production Racha Dahbar Product Manager Traded and 3 rd Party Representative Rebecca Ng National Account Manager, QSR Project Manager Page 5
Foodservice Business unit KPI 1. Design Optimise packaging to achieve resource efficiency and reduce environmental impact without compromising product quality and safety. A) Foodservice products locally manufactured at Huhtamaki Windsor The Windsor plant predominantly manufactures paper cold and hot cups and plastic lids for customer owned brands and Huhtamaki s brands. In the past few years, Windsor has implemented a range of processes and projects addressing the SPG checklist for all products (existing and new) SKUs in Windsor. New SKUs manufactured at Windsor are usually variations of existing SKU usually new graphic designs. Below are key projects and processes that are currently being implemented at Windsor. Timelines are summarised in the table below. Manufacturing: Huhtamaki has systematically improved the energy efficiency of its operations. From the period of 2008 and 2011, the Windsor plant achieved 11% energy reduction, whilst production grew by 5.5 % in the same period. Energy efficiency reduction target Achieve 11% by end 2013. Huhtamaki Windsor has implemented a hazardous material reduction program. Key initiatives include replacing cleaning material with environmentally friendly products, and minimising the storage of hazardous materials on site. Procurement: Huhtamaki manufacturers packaging from different raw materials and combination of materials both renewable and non renewable resources. When selecting material for packaging, the environmental impacts and benefits of packaging throughout its lifecycle are taken into account. Raw materials are divided into two categories according to their origin: renewable and non-renewable materials. The former comprises paper board, paper and the majority of the biopolymers used, the latter conventional plastics. The choice of packaging is based on the requirement in terms of protection, durability, application and our customers requirements. For procurement of renewable materials such as paper, Huhtamaki places focus on the following aspects: o The origin of the wood used for the production of the fiber based materials. o The environmental and sustainability performance of the raw material producers. For procurement of non renewable materials such as plastic are required for packaging, Huhtamaki has in place internal recycling processes (which will be covered in KPI 2). Page 6
Production and Design of Packaging: Product When manufacturing new and existing product, raw materials and the manufacturing method are chosen on the basis of the lifecycle requirements of the product to be packed or served in the package. Huhtamaki Windsor endeavours to source sustainable paper for manufacturing paper cups. Huhtamaki is currently working towards converting majority of the percentage of paper cups to sustainable paper, and also is investigating options of using recycled paper board. Huhtamaki Windsor has also implemented light weighting project for the hot cups range to minimise the use of raw materials. Secondary packaging In the past year, Huhtamaki has reviewed the cartons and palletisation to achieve efficiency without compromising the occupational health and safety, functionality, supply and customers warehouse requirements. For example in 2010, Huhtamaki reviewed one of our most popular products 425ml double wall cup, and found that the palletisation and transport efficiency could be increased through reducing the carton quantities and changing the carton size. B) Foodservice traded products from Huhtamaki overseas sites and 3 rd party manufacturer Huhtamaki sources a range of packaging from other Huhtamaki plants and 3 rd party suppliers in Asia and other overseas markets. These products (disposable tableware) are sold predominantly to the retail channels and comprise plastic plates, cups and cutlery under Huhtamaki s Chinet and Lily, and private label brand names. Due to the nature of the retail channel industry and yearly range reviews, the product ranges can vary on a yearly basis. Specifications for private labels/customer brands are likely to be predetermined by the respective customer, however Huhtamaki endeavours to apply the aligned principles as much as feasible. Although Huhtamaki has a global environmental policy, local Huhtamaki plants policies may be adapted to guidelines specific to country. The focus of this action plan will be aimed at understanding the environmental initiatives at plant level. Sourcing from 3 rd party manufacturer is new to Huhtamaki, and the focus have been identifying suitable third party manufacturers and establishing relationships with the suppliers. Thus, the aim for Huhtamaki will be to develop a guideline that addresses the SPG template. Page 7
KPI 1: Design Key summary and timelines products locally manufactured at Windsor. KPIs Actions Responsibility Target or Performance Goal 1. Design Optimise packaging to achieve resource efficiency and reduce environmental impact without compromising product quality and safety. 1) Manufacturing Continuous improvement of energy efficiency/ 2) Procurement - Adhere to Huhtamaki s Group procurement policy with special focus on renewable raw materials in packaging. 3) Production and Design a. Evaluate alternative paper source which are sustainable or recycled. b. Evaluate secondary packaging to identify opportunities in palletisation and transportation efficiencies. For example, reduction of total shipper cartons that are used to deliver products to market. Plant Manager Supply Chain Manager Sales & Marketing Plant Manger Supply Chain Improve efficiency by 10% Educate and influence customers to use renewable sustainable materials for their packaging. Identify alternative options of sustainable or recycled paper. Improve utilisation by 10-15% Timeline or Milestones (MM/YY) Q4 2013 100% of food packaging manufactured from paper are from sustainable sources. Q4 2012 Q4 2011 Page 8
KPI 1: Design Key summary and timelines traded goods from overseas Huhtamaki sites and 3 rd party manufacturers KPIs Actions Responsibility Target or Performance Goal 1. Design Optimise packaging to achieve resource efficiency and reduce environmental impact without compromising product quality and safety. Collate overseas Huhtamaki plants environmental guidelines. Develop guidelines for 3 rd party manufacturing suppliers Marketing Supply Chain Marketing QA Communicate environmental plans to APC. Communicate Huhtamaki Global Environmental Policies to 3 rd party manufacturers. Timeline or Milestones (MM/YY) Q4 2012 Q4 2012 Understand their existing guidelines, and look at opportunities for improvement or/and developing processes to meet both Huhtamaki s Global Environmental Policies and APC. Page 9
Foodservice Business unit KPI 2. Recycling The efficient collection and recycling of packaging. A) Products locally manufactured at Huhtamaki Windsor, and manufactured by other Huhtamaki sites. Manufacturing: The waste generated by Huhtamaki s processes consists mainly of paper board packaging cutting waste and plastic packaging by products. Globally, Huhtamaki set its target that the share of production process waste delivered for final disposal at landfill sites may not exceed 15%. Secondary cardboard/carton packaging are being recycled/ The paper board packaging cutting used to manufacture paper cups as a downstream resource for tissue paper manufacturing. Plastic packaging scrap is also recycled for downstream manufacturing. B) Foodservice traded products from Huhtamaki overseas sites and 3 rd party manufacturer The same objectives for KPI 1 will be applied to Recycling. Thus, the aim for Huhtamaki will be to develop a guideline that addresses the SPG template. KPIs Actions Responsibility Target or Performance Goal 2. Recycling 1) Manufacturing a. Reduction of waste into landfill b. Reduction of total process waste Plant manager Production teams Reduction for waste into landfill 50% Reduction of total waste by 1%. Timeline or Milestones (MM/YY) Q4, 2011 Q4,2012 Page 10
KPIs Actions Responsibility Target or Performance Goal 2. Recycling Timeline or Milestones (MM/YY) Collate overseas Huhtamaki plants recycling guidelines. Marketing Communicate recycling plans to APC. Q4 2012 Develop guidelines for 3 rd party manufacturing suppliers. Supply Chain Marketing QA Communicate Huhtamaki Global Environmental Policies to 3 rd party manufacturers. Q4 2012 Understand their existing guidelines, and look at opportunities for improvement or/and developing processes to meet both Huhtamaki s Global Environmental Policies and APC. Page 11
Foodservice Business unit KPI 3. Product stewardship a demonstrated commitment to product stewardship by the supply chain and other signatories Huhtamaki manufactures a range of environmentally friendly of products under the brand name Chinet Bioware, which are made from recycled paper and PLA plastics. Huhtamaki is taking a strategic approach beyond offering a range of food packaging products with the focus on the following initiatives: Develop and work with key customers on Life Cycle analysis of food packaging, and identify green opportunities and make improvements from raw material procurement, transportation, production and manufacturing processes, and packaging (primary and secondary) Identify and develop networks with stakeholders such as Waste Companies and relevant Industry Bodies with the aim to find understand how packaging such as Bioware fits into the Life Cycle analysis. The aim is to work in partnership with relevant stakeholders to provide cradle to grave food packaging solutions. This KPI is relevant to both Huhtamaki manufacturing plants and products sourced from a third party manufacturer. KPIs Actions Responsibility Target or Performance Goal 2. Product stewardship A demonstrated commitment to product stewardship by the supply chain and other signatories. Life Cycle analysis on current packaging. Huhtamaki Global Environmental Manager. Sales and Marketing Manager Sales and Marketing team Key customer purchasing team. Complete life cycle analysis for key customer. Application of life cycle analysis across Huhtamaki Food Business unit. Timeline or Milestones (MM/YY) Q4 2011 Q2 2012 Identify and develop networks with relevant stakeholders. Identification and relationship development with relevant stakeholders Q4 2011 Page 12
Moulded Fibre Business Unit Action plan Page 13
Huhtamaki Moulded Fibre objectives: Delivering products on-time Providing consistency of product performance Ensuring employees are skilled and competent Providing a healthy and safe work environment Providing timely maintenance of plant, machinery and equipment Reducing waste in the production process Located in Preston, Melbourne, the Huhtamaki Moulded Fibre division manufactures packaging for the egg, fruit and wine industries. All products are made from 100% recycled paper waste and are fully recyclable and biodegradable. Huhtamaki Moulded Fibre is fully AS/NZS ISO 9001:2008 accredited for Management of design in collaboration with the Huhtamaki Moulded Fibre Technology Centre (Holland). Manufacture and stockholding of pulp moulded fibre packaging products. Huhtamaki Moulded Fibre is committed to delivering: Products and services that meet specifications which have wide international acceptance in our industry Products, activities and services that are all consistently produced and done using the same processes across all Huhtamaki plants Processes and activities which are fully documented, allowing for traceability Innovation and development the process can be accelerated by adopting the same terminology, compatibility and safety Assurance about our quality, safety and reliability Product/Packaging Huhtamaki Moulded Fibre has established a strong performance record in waste prevention and waste to landfill minimisation. In Australia, Huhtamaki uses in excess of 12,000 tonnes of kerbside recycled paper per annum, producing in excess of 195 million units. Products produced at Huhtamaki Preston have a prevalent presence in supermarkets, markets and other retail outlets and customers are proud of the Australian status associated with these products. Page 14
Huhtamaki Moulded Fibre Business Unit APC Team Name Position Involvement David Adolph Oceania General Manager Strategy Bruce Pollard Sales and Marketing Manager Oceania Sales and Marketing Miroslav Krmpotic Quality Manager Environment Peter Dijkstra Manager Global Efficiency Improvement Project Manager Frank Attard Plant Manager Production Stefan Manolidis Supply Chain Manager Supply and Procurement Page 15
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