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Opportunities and challenges
When it comes to human rights, Stora Enso’s operations extend to challenging markets such as China, Pakistan, Laos, and Brazil. Many of the human rights challenges the group faces are deeply rooted in local society, and can only be effectively addressed through long-term commitment and close cooperation with global and local stakeholders.
The UN Guiding Principles on Business and Human Rights emphasise that companies have an ongoing responsibility to respect human rights, even where government actions and regulatory frameworks are deficient. They encourage companies to implement human rights due diligence procedures that identify, assess, and address the human rights risks and impacts of their operations, products, and services.
Stora Enso’s human rights commitment extends from employees and on-site contractors, through external suppliers of materials and services and business partners, to communities living near the group’s operations. In addition to Stora Enso’s commitment to the UN Guiding Principles on Business and Human Rights the group’s Sustainability Agenda is aligned with the ten principles of the UN Global Compact, including its principles on human rights. Stora Enso also respects and follows the legal reporting requirements of the UK Modern Slavery Act.
Relevant Stora Enso policies and statements on human rights include:
- Code of Conduct, which expresses respect for international human and labour rights
- Supplier Code of Conduct, which imposes strict contractual requirements regarding human rights on suppliers
- Human Rights Statement, which expresses respect for international and regional human rights instruments including
- The UN International Bill of Human Rights
- The core labour rights conventions of the International Labour Organisation (ILO)
- ILO Convention no. 169 on the Rights of Indigenous Peoples, including the principle of Free, Prior, and Informed Consent and Participation
- The OECD’s Guidelines for Multinational Enterprises
- The Children’s Rights and Business Principles developed by UNICEF, the UN Global Compact, and Save the Children.
How we work
Human rights risks are taken into account across Stora Enso’s operations from investment decisions onwards, including mergers, acquisitions, and divestments. The group’s investment guidelines stipulate that environmental and social risks and impacts, including those related to human rights, must be duly identified, assessed, and addressed prior to any investments in projects with business critical risks. Business ethics risks and specific investments’ compliance with Stora Enso’s Code of Conduct and Business Practice Policy are also assessed.
Stora Enso’s human rights due diligence procedures include:
- Environmental and social impact assessments (ESIAs)
- Human Rights Assessment conducted in cooperation with the Danish Institute for Human Rights and used to define related human rights action plans
- Appropriate grievance and remediation mechanisms
- Accountability through transparent reporting.
Stora Enso is currently developing a human rights strategy using a best practice methodology. The strategy will be further refined during 2017 and will define a set of prioritised human rights that are the most relevant for Stora Enso.
In 2016 Stora Enso’s focus was on implementing the Human Rights Action Plan that resulted from the group-wide Human Rights Assessment conducted in 2014 and a related report published in 2015.
|Progress on the implementation of preventive and remediation actions as of 31 Dec 2016|
|Completed||On track||Not on track||Closed1||Regular review2|
|Implementation progress, % of all actions||86%||3%||1%||7%||3%|
|1 Issues that were identified in the Human Rights Assessment but closed following reassessment of their validity in specific local contexts.|
|2 Longer-term actions without a targeted end-date that require continuous review.|
By the end of 2016 86% (69% at the end of 2015) of the preventive and remediation actions were completed. Actions were based on the UN Guiding Principles on Business and Human Rights and criteria created in collaboration with the Danish Institute for Human Rights. By the end of the year a small number of actions remained open. These will be progressed to an appropriate conclusion during 2017 and the reporting on Human Rights Action Plan progress will be stopped.
Child labour in supply chains in Pakistan remains a challenge for Stora Enso’s equity-accounted minority investment Bulleh Shah Packaging (BSP). BSP does not employ children in its own operations, and does not accept child labour in its suppliers’ operations. BSP has put processes in place to identify and eliminate child labour in the operations of its direct suppliers. BSP combats child labour through a rigorous supplier auditing programme, awareness-raising and sensitising measures, and BSP’s Child Labour Remediation Policy. BSP also works with suppliers through its public-private partnership with the International Labour Organisation (ILO).
During 2016 BSP’s audit team conducted a total of 108 supplier audits (395 during 2015). Out of these audits 56 (82) were audits of suppliers of recycled paper products (old corrugated cardboard). Out of all the audits 12 were follow-up audits. Due to a sufficient stockpile of biomass and less sourcing, suppliers of agricultural by-products were not audited during 2016. Mainly for this reason the audit coverage of the direct suppliers of domestic fibre and agricultural by-products was lower in 2016 compared to the previous year.
In addition to the audits conducted by BSP’s in-house audit team, the external assurance provider SGS realised nine further third-party audits during 2016 (30).