Paper sourcing – Judging a book by its paper

While the paperless office remains a distant mirage, there are a number of paper sourcing policies pursued by progressive companies that are more or less finding a path through the certification jungle

Paper sourcing policy is an undeniably complex business. A company looking to green up its paper consumption is confronted with myriad types of paper: certified, pre-consumer waste recycled, post-consumer waste recycled, totally chlorine free, elemental chlorine free, and certified mixtures of all these.

After sifting through the options, HSBC made a bold announcement at the start of the year. The banking behemoth has switched all of its marketing material in the UK – including direct mail – to paper from Forest Stewardship Council certified forests and recycled sources, affecting the 4,000 tonnes of paper destined for customers’ letterboxes.

More impressively, the company has committed to switching to FSC-certified and FSC-recycled sources across 95% of its entire global holdings by a provisional deadline of 2009.

Francis Sullivan, HSBC’s adviser on the environment, describes the problem simply: “Banks are very, very paper-rich.” HSBC UK munches 96 million sheets a year in its head office alone, so this has been hailed as a progressive move and one capable of launching the bank as a real competitor to the Co-operative Bank in the sphere of eco-reputation.

While one HSBC spokesperson has remarked almost resentfully that the Co-op “has managed to corner this space for a long time”, Sullivan remains complimentary of the Co-op’s track record.

So just how does HSBC’s policy compare to the Co-op, supposed benchmark of ethical banking? Liz Thompson is an adviser on climate change at the Co-operative Group, and has worked on the company’s paper sourcing. The Co-operative Bank switched to 100% post-consumer waste recycled photocopier paper back in 1999, and has been looking at ecological impacts across the board ever since.

Thompson recalls the initial resistance to recycled paper: “There were all these myths flying around: it will jam the photocopiers and it won’t go through your desktop printer.” She now believes the main barriers faced by the financial services sector are outdated industry standards.

Standards set for cheque paper and paying-in slips by APACS, the trade association for payment-services companies, stipulate that the paper used has to be elemental chlorine free and use virgin fibres (ie, no recycled content).

Thompson suggests these standards are ready to be challenged. The Co-op itself has a policy of using totally chlorine free paper, which “raises the environmental bar” by ruling out use of chlorine compounds in the processing phase. It also rules out a host of potential suppliers. The group makes use of a closed loop system of recycling, through which paper used in its banking offices is turned into kitchen roll and toilet paper for its stores. It prefers to source locally, wary of the transport miles incurred by importing certified paper from abroad.

But recycling is not a totally conscience-salving option. Although paper can be recycled about half a dozen times before the fibres become too short for further use, successful manufacture depends on the introduction of virgin fibres further up the chain before the recycling plant stage.

Thompson is unsure about the origins of the paper used by the recycling plants. “I don’t think there is anything in the recycled grade that you would ever be able to get completely to the bottom of,” he says.

George White, purchasing co-ordinator at the WWF’s global forest trade network, accepts that while it is presently unthinkable in commercial terms, it is conceivable that recycling plants could start to require that their paper inputs come from certified sources. But for the time being the picture remains muddy at best.

“It is an irony that any piece of recycled paper certified by FSC could contain some of the worst sources of pulp,” says White. He says that sources could easily include Asia Pulp and Paper – perceived by non-governmental organisations and industry peers alike as one of the gravest perpetrators of wanton deforestation.

But for companies like HSBC hoping to take the first step in this tricky area, the benefits are clear. Sullivan has found the revamp to be positive in both reputation and commercial terms. In early 2006, HSBC undertook an e-auction for companies hoping to supply the bank with photocopier paper with the requisite environmental credentials. This open tender process proved cost-effective, saving money and greening up the paper supply at the same time.

“If you put in a minimum requirement, then you can get competition,” Sullivan beams. A few years ago these sorts of savings were unthinkable, but certified paper is not a scarce commodity now. Beck Woodrow, construction adviser at FSC, reckons that supply is keeping up with demand.

Certifying marketing materials is an obviously seductive priority for a company to set. Letter-headed paper, business cards and direct mail “talk about the kind of company you are” says Sullivan. But the cynic would perhaps suggest that the certification of paper at the customer interface is an exercise in greenwash, rather than tackling some of the bigger, core areas such as internal consumption, statement papers and chequebooks in the case of banks.

Katie Stafford, sustainability manager at Marks & Spencer, says her company has “tried to prioritise the biggest areas first” by tackling the 20,000 tonnes of board used in its food packaging. But she also sees the sense in HSBC’s approach. Prioritising the customer-facing paper usage “raises the profile of FSC and provides a business case for other people to get involved,” Stafford says.

Anna Jenkins, consultant at Ethical Change and a former director of FSC, agrees, saying: “You’ve got to put it in context and give companies a couple of years grace, but if a few years down the line all they are doing is a CSR report on recycled or FSC paper, I’d be very cynical about it.”

Certainly, HSBC’s longer-term commitments deserve to be given the benefit of the doubt and Stafford is happy to encourage her corporate peers. “Pull off the low-hanging fruit to begin with … but don’t just stop there,” she says.

Paper or people?

The higher-hanging fruit is not so easy to pluck and can require a potentially tough reappraisal of suppliers. When B&Q moved towards certification in the late 1990s, some suppliers did not take the company seriously and many were left scrambling to meet the DIY store’s certification requirements.

Often the demands of corporate customers will force paper suppliers to explore what had previously been a labyrinthine supply chain, with wood coming from an array of unknown or murky sources.

Anna Jenkins recalls working at FSC: “In the last year coming up to B&Q’s deadline we used to joke that we should have applied for funding from the Samaritans, because we had become like counsellors … we had desperately worried people, because they had left it so late and they were going to lose massive amounts of business”.

Jenkins stresses the importance of working with existing suppliers where possible, and devising policies with a long lead time that enable suppliers to progress towards certification and spread change across an industry.

“I think it’s better to work that little bit more slowly, but there is a balance. How slow is too slow?” says Jenkins. “You need realistic timescales, but you’ve got to believe what your customer tells you.” With many mills and suppliers still refusing to change their operations, success according to Jenkins is dependent on companies “making the demands and having some supremely stubborn people on their staff”.

Leadership essential

So how exactly can a company navigate the minefield of paper sourcing without alienating suppliers and keep on top of the developments on the sliding scale towards sustainability? Jenkins is adamant that leadership at board level is crucial. Without support from the top and status afforded to the personnel effecting the change, any project will always risk losing momentum, she says.

In her role as consultant for Ethical Change Jenkins has witnessed the power of a single shareholder (“a very large pension fund”) to change the attitudes of a corporate boardroom seeking to drop work in this area. This sort of pressure is encouraging boardrooms to appoint the right people with the right mixture of gravitas, stubbornness and optimism. “It takes a very special person to cut through the crap, to put it bluntly,” says Jenkins.

And from good leadership springs many other policies that can run in conjunction with paper certification. HSBC’s Sullivan describes a practice at one of the bank’s offices in the US where a swipe-in swipe-out system monitors employee print accounts. And while he wryly noted the “big brother” implications, Sullivan is sure that the “biggest way of achieving reduced consumption is through IT” and a “dematerialisation of mail”.

Marks & Spencer is hoping to instil a “culture across the business”. Eco-conscious screensavers, stickers on computers and machinery and scrolling screens at the entrance to the office are planned, with the aim of encouraging people to switch off their computers and not print things out unnecessarily. An internal memo posted in late January reminded employees that the company had switched from virgin paper to recycled, saving 1,600 cubic metres of annual landfill, and urged staff to print on double-sided paper and reuse where possible.

Marks & Spencer is openly sharing its knowledge in this area, telling other competitors how it has sourced its sustainable sandwich packaging. Jenkins believes this knowledge sharing is a growing trend in the field of corporate responsibility generally.

Preps – the Publishers database for Responsible Environmental Paper Sourcing – was set up last year by Acona, bringing together a group of businesses in the publishing industry that have agreed to share supplier information in a database.

The book-publishing sector sources a substantial proportion of its paper and manufacturing from China where forest management is often poor. And the “fiddly bits” of children’s books (such as pop-ups parts) are often manufactured by the cheap labour of children with small hands in south Asian countries where labour laws are poorly enforced.

Preps is an effort to empower publishers to take control of the darker side of their supply chains. Members provide the names of suppliers and paper types, which are then researched by Acona, which grades the sources according to a system devised by children’s book publisher Egmont (based on WWF’s Global Forest and Trade Network reporting categories). The information is then collated and made available for view to all the members.

Traceability concerns

Neil Everett, one of Acona’s consultants on the project, appreciates how difficult this is for publishers that have until now had very little understanding of the paper supply chain. He says: “At the time they didn’t even know which papers they were using. Suppliers were using merchant brand names that weren’t actually the mill brand names, so it was very hard to get traceability.”

The project is being hailed by campaigners in the area as a practical tool on the long path to sustainable and ethical paper sourcing. “It’s a move enabling them to make decisions and in a format that is easily understandable by the procurement people,” says Everett.

Membership of Preps is presently closed. It hopes to open up to other book publishers once the operation is up and running, although the flat-rate membership fee is unlikely to be an option for smaller publishing houses.

Other big paper consumers are keeping quiet on the subject. The UK’s largest newspaper publisher, Trinity Mirror, has failed to comment on the details of its paper sourcing policy, which makes open-ended commitments to work with suppliers, certify and maximise recycled paper usage. Bloomberg – which boasts a seemingly paperless digitised office in London – also refused to divulge its position on paper sourcing.

But for businesses looking to progress in this area, co-operative, knowledge-sharing schemes can be a way to make headway in what is a core environmental impact area for many businesses. Jenkins at Ethical Change is hopeful, saying: “In the last six months I’ve noticed a trend … it seems like more and more, there are businesses and research groups saying ‘right, we are going to give our information away’.”



It’s all about the trees

Paper comes from trees. And while forests still cover about 30% of the Earth’s land surface, their stewardship is in the hands of a few – only ten countries account for two-thirds of the total.

Worryingly, deforestation is highest in those tropical areas where biodiversity value is also the highest. Forests are also movers and shakers with regard to the global climate. Deforestation has been responsible for about one-fifth of global CO2 emissions – more than the volume spewed out every year by the global transport sector.

Meanwhile, forests conserve landscapes, soil and water resources and are essential to the livelihoods of the 735 million rural people who live in or near closed tropical forest areas.

Source: OECD